AHTC lawsuits: Town councils' lawyers slam bid to discredit accountants

Lawyers for Aljunied-Hougang Town Council argued that, contrary to the defence's claim, the defendants are fiduciaries, not just mere custodians of public funds.
Lawyers for Aljunied-Hougang Town Council argued that, contrary to the defence's claim, the defendants are fiduciaries, not just mere custodians of public funds.LIANHE ZAOBAO FILE PHOTO

They say WP town councillors' allegations are 'mere afterthoughts'

The Workers' Party town councillors "continue to avoid taking responsibility for using the residents' monies to reward their supporters", lawyers have argued.

"Instead, they focus on a catalogue of technical points which do nothing but draw even more attention to the fact that they abused their office," the lawyers alleged.

Among the arguments they put forth - in a multimillion-dollar lawsuit over alleged improper payments by the town council - were that the defence's attempt to discredit two senior accountants who had audited Aljunied-Hougang Town Council's (AHTC) books was "entirely without merit".

These were in the two closing replies, each more than 50 pages long, submitted to the High Court last Friday by lawyers representing AHTC and Pasir Ris-Punggol Town Council (PRPTC).

They were responding to closing arguments the defence made in January, which in turn followed a 17-day trial in October last year. The defence also submitted its closing replies last Friday.

AHTC and PRPTC are suing five WP town councillors - including WP chairman Sylvia Lim, its secretary-general Pritam Singh and former chief Low Thia Khiang - over $33.7 million in alleged improper payments made to a former managing agent and other contractors when the councillors ran AHTC.

PRPTC is suing to recover its share of losses incurred when Punggol East constituency was run by AHTC from 2013 to 2015.

 
 
 

Among other things, defence lawyers argued that KPMG executive director Owen Hawkes and PwC partner Goh Thien Phong were not independent experts.

But AHTC's lawyers from Shook Lin & Bok said KPMG had been appointed by AHTC - on the instructions of Ms Lim, Mr Low and/or Mr Singh - after the Court of Appeal had directed them to get an accountant to look through their books in March 2016.

"This exposes the present allegations of partisanship on (Mr Hawkes') part as mere afterthoughts, raised as an unjustifiable attempt to taint the credibility of his evidence and the KPMG report," they said.

PRPTC, which is represented by Davinder Singh Chambers, said there was no evidence that it interfered with Mr Goh's work. Neither was such a suggestion made.

AHTC's lawyers also argued that, contrary to the defence's claim, the defendants are fiduciaries, not just mere custodians of public funds.

Also, AHTC could have compelled the managing agent for the town council while it was run by the People's Action Party, CPG Facilities Management, to take over Hougang ward at the same rates, as stated in the contract, lawyers said.

In addition, they disputed the defendants' claim that they had been acting in good faith.

Referring to Ms Lim and Mr Low, they said: "AHTC's case is they acted with ulterior motive and/or recklessly and/or were wilfully blind to the consequences... A town councillor who does not breach their fiduciary duties to AHTC as SL and LTK did should not have anything to fear."

PRPTC lawyers also said most things argued by the defendants were, in fact, matters of evidence - like how Mr Low did not make attempts to retain CPG as the managing agent to fulfil his plans for FM Solutions & Services to take over the management of the town council.

Oral submissions will be on April 9 and 10, after which Justice Kannan Ramesh will deliver his judgment.

 
A version of this article appeared in the print edition of The Straits Times on March 04, 2019, with the headline 'Town councils' lawyers slam bid to discredit accountants'. Print Edition | Subscribe