Possible civil suit against former NKF board in the works: NKF

By Rita Zahara, Channel NewsAsia
Time is GMT + 8 hours
Posted: 11 April 2006 2136 hrs

A possible civil suit against the board of directors of the former National Kidney Foundation appears to be in the works, now that Allen & Gledhill, one of Singapore's leading law firms, has been appointed to act for the NKF.

The NKF says that it is serious in taking its former board of directors to task, if there has been any legal wrongdoing.

NKF Chairman Gerard Ee said: "We have asked (Allen & Gledhill) to look into matters and to advise the board as to what's doable and what's not doable. If there is something that they advise that is doable, then of course we will weigh against possible cost and the potential outcome and then to decide whether or not to act on their advice."

NKF may have to write off S$6.3 million, about half of which was paid to Forte Systems.

Another accounting inconsistency is the Protonweb Solutions deal, worth S$4.5 million.

The old NKF paid both firms, even though both had failed to deliver their services.

Lawyers Channel NewsAsia spoke to outlined some of the likely scenarios for a civil suit.

Lawyer David Rasif said: "Just based on the report, there appears to be three distinct claims. The first, of course, would be against Forte Systems by NKF. The second (is) a claim by NKF against possibly Protonweb. And the third, of course, is a claim against the CEO and the board of directors ... if they find, for example, that they have not exercised and discharged their duties according to the standard that the law requires, that it is actionable against them personally."

Channel NewsAsia understands Allen & Gledhill was chosen out of four other law firms.

Its team of lawyers, led by Senior Counsel K Shanmugam, has already begun looking at contracts entered into by the old NKF board.

At present, investigators looking into the case, such as the Commercial Affairs Department and Corrupt Practices Investigation Bureau, remain tight-lipped.

Therefore, lawyers Channel NewsAsia spoke to say it is too soon to say if former CEO TT Durai and his former colleagues will face any criminal sanctions. - CNA/ir/ct