SINGAPORE - A 49-year-old man has sued five paternal aunts and uncles in their 70s and 80s, seeking to cash out from an asset-rich but inactive family-owned property development company.
Mr Loke Chan Thai, who inherited his father's shares in Tai Heng Development in 2003, is asking the High Court to order his three aunts and two uncles to buy him out or to wind up the company.
Despite owning a plot of vacant land and unsold houses on Old Yio Chu Kang Road worth close to $60 million, Tai Heng has not developed any property in the past two decades.
Almost every year from 1996 to 2015, the company posted losses of about $400,000 per annum. And apart from rental income, the company has not been generating revenue and draws from an overdraft facility to pay its expenses, including directors' remuneration.
In his suit, Chan Thai, who owns about 14 per cent of the company, argued that his rights as a minority shareholder have been oppressed.
The defendants are Madam Loke Mui Heng, 84, Madam Loke Siew Heng, 81, Mr Loke Weng Yew, who died after the suit was filed, Madam Loke Seut Heng, 87, and Mr Lok Wing Cheong, 78.
Mui Heng and Siew Heng are directors of the company, while Seut Heng resigned as a director in 2013.
Chan Thai, represented by Mr Chia Ho Choon, argued the directors had made no efforts to continue any meaningful business activity, which has caused the company's assets to languish.
He argued the directors are operating the company for their own benefit to the detriment of other shareholders by paying themselves excessive and unjustified remuneration and fees, amounting to at least $3 million in 15 years, despite the losses suffered by the company.
He contended that although dividends were declared between 2003 and 2006, they were not paid to shareholders.
He also pointed out ties between his aunts and uncles have soured, with the siblings split into two camps. The dispute culminated in an application by Seut Heng and Wing Cheong to wind up the company in 2012. The spat was settled but the terms of the settlement agreement have yet to be effected.
The defendants are separately represented by two sets of lawyers, led by Mr Andy Lem and Mr Chan Hock Keng.
They argued that development plans had been put on hold due to poor market conditions and the dispute among the shareholders.
They noted that Chan Thai was an employee of the company from 1992 to 2014. His last drawn salary was $7,893 and he was actively involved in business operations, they said.
The case has been fixed for a 15-day trial.