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Tycoon Oei Hong Leong, Raffles Edu chairman Chew Hua Seng in courtroom showdown
TYCOON Oei Hong Leong is facing off against the chairman of Raffles Education Chew Hua Seng in the High Court, over an alleged promise by Mr Chew to procure a buyer for Mr Oei's shares in the mainboard-listed education provider.
The sale did not go through ultimately. Mr Oei and his namesake company Oei Hong Leong Art Museum are seeking - through senior counsel Davinder Singh - damages of at least S$15 million or as much as S$26.5 million in the three-day trial that started on Monday.
On Oct 16, 2017, Mr Oei and Mr Chew at the house of Mr Oei's sister had a discussion that culminated in two identically worded handwritten notes made by Mr Chew, which is the subject of this lawsuit. According to the plaintiffs, Mr Chew had agreed to procure a buyer to buy all of the plaintiffs' 12.88 per cent stake in Raffles Education at S$0.44 per share within a month from the date of the note.
The plaintiffs would withdraw their notice of requisition for an extraordinary general meeting (EGM) at Raffles Education in return for Mr Chew's procurement. The EGM aimed to remove Mr Chew as chairman and chief executive.
In the opening statement, Mr Singh said: "A man's word is his bond. A gentleman's handshake is worth infinitely more than any signature. But not for the defendant, Mr Chew Hua Seng. For him, promises which he penned in his own words and signed, and then rewrote word for word (so that the plaintiffs can have one copy) and signed again, and which were both witnessed and then sealed with a handshake, count for nothing."
The damages of S$15 million that Mr Oei is claiming are the difference between the sale price of S$0.44 and the S$0.33 when trading closed on Nov 15, 2017, the deadline in the alleged deal. The higher amount of damages of S$26.5 million were assessed by the plaintiff's expert witness.
Mr Singh in describing Mr Chew's conduct from the beginning right up to this trial, said it "has been nothing short of disgraceful". "Having shamelessly disclaimed his written commitments, he tried, in these proceedings, to hide highly relevant documents from the court to prevent it from having the facts."
Mr Chew, who is represented by another senior counsel Alvin Yeo, disputes there were legally binding intentions when he made the handwritten notes. Instead, it was agreed that the notes were a "friendly agreement" and "would not be used in court", he alleges.
The 65-year-old also claimed that he did introduce an investor to buy Mr Oei out of Raffles Education, but the latter suddenly imposed a new term at the eleventh hour just before the transaction. This irked the investor and the transaction did not go through as a result, the defence said.
Mr Oei and Mr Chew had been "quite good friends" for about 10 years before the handwritten notes were made, Mr Oei testified in court on Monday under cross-examination. But when the notes were made, he said, "in my mind, I was not treating him as a friend".
Mr Oei and his company still owned about 12.9 per cent of Raffles Education as of Feb 22 this year, according to the defence.
Mr Oei is the only factual witness from the plaintiffs, while Mr Chew and his wife will testify for the defence. Both parties will each call an expert witness on their calculation of damages - if any.
Raffles Education posted a net profit of S$40.2 million for the year ended June 30, nearly quadruple from S$10.6 million the year before. The commercial school operator was trading flat at 7.2 Singapore cents on Monday morning.