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Jason Holdings seeking legal advice on court's decision to strike out third-party claims
JASON Holdings announced after trading hours on Tuesday that it will appeal the court’s decision to strike out third-party claims against the company by EQ Insurance.
The company said that it will defend such a claim “vigorously” and that it is currently in the midst of seeking legal advice on the appropriate steps to do so, and will update shareholders on any developments.
In 2016, Hyundai-GS Joint Venture engaged Jason Holdings’ wholly owned subsidiary, Jason Parquet Specialist (Singapore), for the supply, installation and maintenance of timbre flooring and decking works for a project stipulated in a sub-contract agreement dated Feb 15, 2016.
On March 28, 2016, EQ Insurance issued a performance bond in favour of Hyundai-GS for the sum of S$395,183.50, representing 10 per cent of the sub-contract sum. According to papers filed in the High Court Suit, Hyundai-GS wrote to EQ Insurance on Jan 25, 2017, demanding payment of the sum. EQ Insurance took the position that the performance bond had not taken effect at all as it was cancelled before it could be delivered to Hyundai-GS, and that the performance bond was cancelled because Jason Parquet Specialist (Singapore) had no intention to commit to the agreement with Hyundai-GS.
EQ Insurance had, through the third-party proceedings, brought in Jason Holdings as the third party on the basis that the company is liable to indemnify EQ Insurance against Hyundai-GS's claim and the costs of such action as the court may deem fit on the grounds that the company had agreed under a deed of indemnity dated Feb 5, 2016 to indemnify EQ Insurance against all demands, actions, losses and expenses arising out of the performance bond.
Amendment note: The company clarified that it is still seeking legal advice and has not made a decision yet.