UOB has lost a long-running legal tussle against developer Lippo Marina Collection (LMC), with the Singapore High Court throwing out the bank's claims that Lippo had inflated mortgages to get higher housing loans.

The bank said it will be appealing the court's decision. It is seeking to recover about S$181 million disbursed to purchase 38 units at Marina Collection, a luxury condo at the wealthy enclave at Sentosa Cove. UOB is represented by lawyers from Tan Kok Quan Partnership.

In a lawsuit first filed in November 2014, UOB alleged that LMC - a subsidiary of Indonesia's Lippo Group - had conspired with two property agents to offer "excessive" furniture rebates provided to buyers, inflating the stated sale prices of units at the Marina Collection.

The bank had claimed it was thus misled into granting housing loans based on the inflated stated sale prices, instead of actual purchase prices of the units.

High court Judge Aedit Abdullah dismissed all claims against LMC, but the bank succeeded in its allegations of misrepresentations against property agents Goh Buck Lim, also known as Rick Goh, and Aurellia Ho, court documents seen by The Business Times showed.

Justice Aedit said that the claim of deceit was made out against the duo, but their liabilities do not make a substantial difference to the outcome.

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The judge also said the bank failed to prove that the three defendants conspired to harm the bank.

"Preventing the plaintiff bank from coming to know of information does not mean that there was a combination or agreement to commit unlawful acts against the bank. There has to be something more, tying the alleged agreement to a plan employing the use of unlawful means," ruled Justice Aedit.

"Suppressing or hiding information about the furniture rebates does not involve such a link since there was no duty to disclose. Rather, it could only be actionable if it was part of a larger web of agreements to employ unlawful means."

Justice Aedit added that he was "doubtful" over the claim of conspiracy that the bank's loan was made on something other than what was defined as the "true price".

"There is no true price for real property; these are not marked to market as are securities, nor is there any market that can indicate the true market price. As the evidence showed that the price expressed on the loans were within what would have been accepted as reasonable valuations, I am unable to conclude that there was any harm occurring to the bank in this manner."

The court heard that in December 2011, LMC's general manager Woo Pui Lim had entered into an agreement with Mr Goh to grant furniture rebates to purchasers.

UOB alleged that the plot to get inflated home loans led the bank to finance S$4.9 million - in excess of the property's actual price. In some cases, the rebates ran up to 34.5 per cent of the stated purchase prices, the bank had claimed.

LMC, which is represented by Drew & Napier, denied the conspiracy. It claimed that furniture rebates were a common marketing tool used by many developers to court potential home buyers.

It said instead that UOB was "the victim of its poor internal system of checks" that allowed itself to be "manipulated by" property agents Goh and Ho, as well as then-UOB salesperson Ann Ong, in extending the inflated loans.

"Unfortunately, the risk of default (which exists in all housing loans) came true in this case at a time when a dampened property market meant that UOB could not recover the amounts owing on the loans by simply enforcing the mortgage and selling the properties," LMC's lawyers had said.

The Marina Collection was launched for sale in late 2007, but sales were hampered after a series of cooling measures - with only 42 of its 124 units sold by March 10, 2011. UOB had also claimed that the conspiracy allowed LMC to dispose of the units.

READ MORE: UOB vs Lippo on inflated mortgages - excessive furniture rebates or poor internal controls?