Hyflux’s pre-emptive lawsuit against Olivia Lum is on hold

HYFLUX’S pre-emptive lawsuit against its founder Olivia Lum Ooi Lin has been put on hold upon the plaintiffs’ application as Hyflux’s liquidators are still investigating if there are sufficient grounds to pursue the claims. 

A pre-trial conference was held on Monday (May 23) for what the plaintiffs termed a “protective writ” against Lum. 

Senior Counsel Davinder Singh and lawyer Jaikanth Shankar, who act for Lum, told The Business Times on Monday that the High Court granted the plaintiffs a temporary stay of the proceedings until Sep 27, 2022. The plaintiffs said they need more time for their investigations and to take legal advice. 

“It is the plaintiffs’ own position that there are no substantive proceedings between the plaintiffs and Ms Lum,” Shankar said in his response to BT. “Our client’s position is that there was no basis both to file the writ in the first place and for any claims against her.”

Eddee Ng of Tan Kok Quan Partnership, representing the plaintiffs, said he has no instructions from his clients to speak, a position they have taken since BT first approached Ng in April regarding them taking pre-emptive legal action against Lum and their former auditor KPMG.

Mainboard-listed water treatment company Hyflux, together with its subsidiaries and their 2 liquidators from Borrelli Walsh, filed a writ against Lum on Mar 28. A lawsuit was also lodged against KPMG, the former auditor for the listed entity and several units in the group. 

Neither Lum nor KPMG has been served the writ. These are “protective” writs lodged to avoid a time limit that would prevent any future claim, while the liquidators conduct investigations to ascertain if the plaintiffs have sufficient legal basis to pursue the claims.

Hyflux was ordered by the court to be placed under judicial management in November 2020 and be wound up in July 2021, after the company failed to secure a white knight despite numerous attempts while it was under a debt moratorium for almost 2 years.

Its troubles emerged in 2014, following its venture into the energy business through the Tuaspring desalination plant. The plant chalked up losses amid low electricity prices and a challenging macro environment, while Hyflux continued to borrow heavily from banks and investors through the issuance of perpetual securities.