WP leaders, AHTC members principally acted in good religion however negligent in some areas: Court docket of Enchantment

SINGAPORE: The Court docket of Enchantment on Wednesday (Nov 9) allowed a part of the appeals brought about by the Workers’ Party (WP) leaders and associated events within the Aljunied-Hougang City Council (AHTC) case. 

In a reversal of the Excessive Court docket’s judgment, the apex court docket discovered that the members and senior staff of AHTC don’t owe the city council fiduciary or equitable duties.

The majority of the accusations levelled on the WP Members of Parliament and AHTC councillors had rested on this purported breach of fiduciary or equitable duties.

Nevertheless, the court docket discovered that the members and senior staff are liable to AHTC for “gross negligence” in sure respects regarding the funds course of. 

WP chief Pritam Singh, Aljunied GRC MP Sylvia Lim and former WP secretary-general Low Thia Khiang had been discovered liable in October 2019 for breaching various kinds of duties within the dealing with of about S$33 million on the town council funds.

Different appellants within the fits are then-AHTC councillors Chua Zhi Hon and Kenneth Foo Seck Guan, together with managing agent FMSS and its director Ms How, who additionally acts within the capability of her late husband Danny Loh.

An impartial panel appointed by AHTC launched the go well with in opposition to the WP leaders and AHTC councillors, who had been tried in 2018 for breaching duties owed to AHTC and Pasir Ris-Punggol City Council (PRPTC) between 2011 and 2015.

All eight events appealed in opposition to the excessive court docket’s discovering that they had been responsible for numerous breaches.

The appeals had been heard by a five-judge panel comprising the Chief Justice and Justices Andrew Phang, Judith Prakah, Tay Yong Kwang and Woo Bih Li.

The WP Members of Parliament and AHTC councillors had been accused of breaching their fiduciary duties within the appointment of city council managing agent FM Options & Providers (FMSS). FMSS was led by Ms How, WP stalwart Low Thia Khiang’s long-time colleague from Hougang City Council.

On account of this appointment, they allegedly allowed “improper” funds of greater than S$33 million to FMSS, its service supplier FM Options & Built-in Providers (FMSI) and third events.

THE FIDUCIARY ISSUE

A fiduciary is an individual who acts for or on behalf of one other, in a authorized or sensible relationship of belief, equivalent to one between a trustee or beneficiary.

In its choice launched on Wednesday, the court docket discovered that there have been a lot of explanation why fiduciary duties shouldn’t be imposed in town councillors and staff.

These embrace the truth that the connection between a city council and its members and staff doesn’t bear the traits of a fiduciary relationship.

“The important thing reality militating in opposition to the imposition of fiduciary duties on this case is the truth that the city councillors and the workers had been executing statutory duties below public regulation,” mentioned the Chief Justice.

He mentioned it was “each unprincipled and inappropriate to ‘convert’ these statutory duties present below public regulation into fiduciary duties present below non-public regulation”.

The court docket disagreed with the plaintiffs that it was essential to impose fiduciary duties in town councillors and staff as there can be no mechanisms to implement the duties of a city council.

The court docket pointed to a key provision within the City Councils Act, which mandates {that a} city council should adjust to all obligations below the act.