Friday, January 12, 2007

Durai's cave-in hurts trio's case

Evidence Act means NKF can use ex-CEO's admission against former colleagues
Ansley Ng ansley@mediacorp.com.sg

NOW that he has conceded the civil suit against him, former National Kidney Foundation (NKF) chief T T Durai may be out of the limelight, at least until he is called to the stand.

Today, the NKF's lawyers will be turning their attention to Mr Durai's ex-colleagues turned co-defendants — former chairman Richard Yong, ex-treasurer Loo Say San and former Board member Matilda Chua. Together with Mr Durai, the trio are accused of breaching their duties as directors and fiduciaries, causing the NKF to suffer loss and damages.

NKF lawyers, led by Senior Counsel K Shanmugam, now have to convince Judicial Commissioner Sundaresh Menon that the trio are liable as well.

The suit, which started on Monday, took a surprise turn when Mr Durai thew in the towel and admitted to the many charges that the NKF levelled against him.

In doing so, he was admitting to many allegations, including those of abusing his power for improper purposes and using NKF funds for lavish travels. It also means leaving his three co-defendants to carry on fighting the suit themselves. But a little-known section of the Evidence Act might make the trio's task more difficult.

Mr Yong, Mr Loo and Ms Chua will now have to overcome Mr Durai's confession because the Evidence Act allows the NKF to use his admission against them.

Should JC Menon rule against the defendants, there is also the issue of assessing damages.

In its statement of claims, the NKF is claiming about $12 million from Mr Durai and his co-defendants that was allegedly wasted on salary increments, failed contracts and loss of donations. The NKF believes it may have lost $4 million in donations following a public outcry against Singapore's biggest charity scandal, that happened mid-2005.

The figure could rise or fall, depending on JC Menon's findings.

Lawyers told Today it would be difficult for the NKF to determine how much donation money it had lost.

"Firstly, (NKF) would have to show a clear link that the acts the NKF has complained against him — and which he has conceded — resulted in the lost future donations," said lawyer Vijai Parwani. "Next, it would be not be easy to prove this exact amount as calculating the loss of future donations is not an exact science ..."

At the assessment hearing, likely to take place within 12 months, the court will decide the amount of damages the defendants will have to pay.

But it is up to the NKF to decide who pays what.

Under a "joint and several liabilities" rule, a plaintiff who receives a favourable judgment from a court will decide which of the defendants it wants to claim the money from.

This means the NKF — if it wins — can divide the sum among all the parties, or claim the entire sum from one party, understandably the one with the deepest pockets.

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