Ms How Weng Fan (third from left) arriving at the Supreme Court with her lawyer, Leslie Netto, and his legal team on Oct 16, 2018. (Photo: Gaya Chandramohan)
SINGAPORE: The managing agent embroiled in the long-running Aljunied Hougang Town Council (AHTC) case and its director are suing their insurer for failing to indemnify them or make any payments over the lawsuits.
The parties suing Allied World Assurance Company are: Former AHTC managing agent FM Solutions & Services (FMSS) and its director Ms How Weng Fan, who is also suing in the capacity of her late husband Mr Danny Loh.
According to court documents obtained by CNA, the three plaintiffs are suing Allied World Assurance Company for failing or refusing to indemnify them or make payment to them as provided for under their insurance contract after the plaintiffs were sued by AHTC and Pasir Ris-Punggol Town Council (PRPTC).
FMSS, Ms How and Mr Loh signed an insurance contract with Allied World Assurance Company in August 2016, according to court papers.
According to the three plaintiffs, the insurer agreed to indemnify them against liability at law for money to be paid under judgment, award or settlement arising from legal proceedings brought by third parties against them, resulting from any civil liability incurred in connection to the property management or project management services they provided.
The insurance company was also supposed to pay all other costs and expenses incurred by the plaintiffs in such legal proceedings, such as the legal costs of defending themselves, said the plaintiffs.
The indemnity was effective for the period from Aug 16, 2016 to Aug 15, 2017, and AHTC filed its lawsuit against the plaintiffs on Jul 21, 2017, with PRPTC following suit on Aug 3, 2017.
However, the plaintiffs alleged that Allied World Assurance Company breached the insurance contract by failing or refusing to indemnify them or make payment to them as provided for under the contract.
The plaintiffs alleged that they have suffered "loss and damage", including the legal fees they incurred in defending both civil suits.
They are suing for declarations that the insurer breached its obligations under the insurance contract, damages, interest, costs and other reliefs.
They filed a writ of summons to avoid potential time bars under the Limitation Act and were last granted an extension for the writ to be renewed for another six months from Jul 3, 2023.
The insurance company is represented by Mr Joshua Ho, Mr Joseph Lee and Ms Pak Waltan from LVM Law Chambers.
Parties last came to court for a pre-trial conference on Dec 15, according to public court records.
BACKGROUND OF THE AHTC SUIT
FMSS, Ms How and Mr Loh are all defendants in the civil suits brought by AHTC and Pasir Ris-Punggol Town Council (later handed over to Sengkang Town Council) against Workers' Party leaders and former AHTC town councillors for the alleged misuse of millions in town council funds.
The eight defendants are: WP leaders Ms Sylvia Lim, Mr Low Thia Khiang, Mr Pritam Singh, FMSS, Ms How, Mr Loh and then-town councillors Mr Chua Zhi Hon and Mr Kenneth Foo Seck Guan.
AHTC and PRPTC had sued the eight of them after an independent panel was appointed to look into alleged improper payments made by AHTC under the charge of the WP leaders.
PRPTC was involved to recover its share of losses incurred when Punggol East constituency was managed by AHTC from 2013 to 2015. After WP claimed back the area by winning Sengkang GRC in the 2020 election, PRPTC handed its suit to SKTC.
Wielding a report by auditor KPMG flagging concerns in how AHTC was run, the town councils charged that the WP leaders and town councillors had allowed a system to persist where money was handled by parties with conflicts of interest - Ms How and her late husband held roles in both AHTC and FMSS, which was being paid by AHTC to manage property and manage projects.
The cases, which were heard together and went to trial in October 2018, have been racking up thousands in legal costs, with the WP town councillors involved raising more than S$1 million for legal fees in end-October 2018.
At the end of the tranche to determine liability, a High Court judge found the defendants liable for various serious breaches.
However, when the defendants appealed against the finding, the Court of Appeal overturned several of the findings by the High Court while holding that the defendants were still liable for various types of negligence in how there was a lack of proper controls in their payments processes.
The latest development came last month, when the Court of Appeal ordered AHTC and PRPTC to pay costs and disbursements of about S$388,800 in total for the appeals, which the WP leaders and town councillors had largely succeeded in.
The next step for the case is for damages to be assessed for these negligent breaches - parties are still at the pre-trial conference stage.
According to an affidavit dated Dec 12, 2022, by Mr Nicholas Leow Zhi Wei of Netto & Magin - the lawyer for FMSS, Ms How and Mr Loh - the trio would take the position for the damages part of the AHTC case that damages due "ought to be nominal or nothing at all".
https://www.channelnewsasia.com/sin...eng-fan-suing-insurer-pay-legal-costs-3996096
