Laguna club owner Peter Kwee in court to lay claim to five properties held in bankrupt daughter’s name

MOTORING tycoon Peter Kwee took the stand on the first day in a civil trial over the ownership of five properties held in the name of his daughter Karen, claiming that the properties were held in trust in his favour.

The owner of Laguna National Golf Resort Club is saying he is the true beneficial owner of the properties – a claim which would exclude them from being counted as part of Karen’s bankruptcy estate; it would also prevent their sale proceeds from being distributed among her creditors.  

On Tuesday (Feb 4), the lawyers representing Kwee and those acting for his daughter’s estate gave their opening statements. The lawyers acting for the trustee also questioned Kwee.

The five properties in the dispute comprise two landed properties in Bukit Timah, and three overseas properties in Australia and Canada. Three bank accounts, which were opened for handling those assets, will also be subject to examination by the defence’s lawyers. 

In his opening statement, Kwee claimed that the properties were purchased and registered in his daughter’s name for business strategy, wealth planning and investment purposes. The properties were paid through sums from his own funds, bank accounts held in his and his daughter’s names and cheques issued by Kwee’s company, Exklusiv Auto Services.

Tay Yan Xia of Chong Chia & Lim, the law firm acting for the elder Kwee, told the court that Kwee had a “name-placing agreement” with his family members, under which he would purchase a property and place it under a family member’s name. The property would, however, remain for his benefit or his use.

Tay stressed: “He controls the finances of his family members and... he makes the overall decisions within the family.” She added that the elder Kwee was “the ultimate decision-maker for all the properties, including what the properties (were) to be used for”. He decided on their tenancy terms, when he would like them sold and their selling price, she said.

In an opening statement for Lai Seng Kwoon, the private trustee of Karen Kwee’s bankruptcy estate, law firm Shook Lin & Bok noted, however, that the alleged trust agreement was entered into verbally, and that there was “no written record in any form” capturing it. 

The lawyers said: “It only follows that the trust agreement as alleged by (Peter) Kwee can only be valid in respect of the properties, if it exists as either a resulting, implied or constructive trust.” 

Louis Lai, a Shook Lin & Bok lawyer on the case, noted that Karen had conducted herself as the owner of the properties without her father’s “prior approval, instruction or consent”. 

He cited the case of one of the Bukit Timah properties, a three-storey semi-detached house in King’s Drive, which was the subject of a dispute among Karen, her father and one Low Kai Yang.

In that 2023 lawsuit, The Business Times reported that Low claimed that the property was used to secure an S$800,000 loan he agreed to lend to Karen. Karen had issued an option to purchase for the house to Low, who believed he had the right to exercise this option if the loan was not repaid. 

The elder Kwee intervened sometime in 2022, submitting an affidavit to the court claiming that he, not his daughter, was the true owner of the property. 

BT understands that Low has since discontinued his involvement in the case. The court has not made any order to costs. 

In the trustee’s opening statement, Shook Lin & Bok said that, despite the “alleged existence of the trust agreement” between Karen and her father, she “consistently failed to assert the existence” of the document in her meetings with Low when discussing the option to purchase. 

“Even after Kwee found out about the option, he did not mention the trust agreement or that he was allegedly the beneficial owner of the King’s Drive property in his meetings with Low, and (he) did not lodge any caveat to protect his supposed interest in the King’s Drive property despite the threat of (Low) enforcing the option,” the lawyers said.

It was only after a statutory demand had been served on Karen on May 12, 2022, that the elder Kwee lodged caveats for the King’s Drive property and the other landed property in Singapore – a cluster house in The Teneriffe development. This was more than 20 years after the purchase of both the properties, the lawyers said.  

And only after bankruptcy proceedings commenced against Karen in June 2022 did Kwee commence a lawsuit to assert his claim in respect of the trust agreement, the lawyers said.

When cross-examined by Daryl Fong, a partner from Shook Lin & Bok, Kwee said his approach in purchasing properties was to tell his family members that he would put them under their name, but that the properties belonged to him.

According to court documents, Kwee previously said: “I will manage the property, you just do what I say. After I die, it is yours. I will see how to split assets within the family.” 

When Fong noted that Kwee did not put the Teneriffe property in trust, unlike what he did for a separate unit at The Claymore condominium held in trust for his granddaughter, Kwee said that there was a “fundamental difference” between both properties. 

When he purchased the Claymore property around 2016, there were property measures such as Total Debt Servicing Ratio (TDSR) and Additional Buyer’s Stamp Duty (ABSD) in place, Kwee argued. 

“Because of those issues, my mind is, if I want to buy this property what am I going to do? If I hold it, I am facing TDSR, I am facing ABSD. In my heart, ok lah, this one I give to (my granddaughter).” 

Fong then asked him if it would be fair for someone looking at the title deed of the Teneriffe property to assume that Karen was the true and beneficial owner of the property, to which Kwee said he believed it would be fair to assume so. 

Fong said Kwee should have placed the King’s Drive property in trust to protect his alleged beneficial interest, to which the elder Kwee said he “did not think that was necessary” and that his son, wife, secretary and “maybe” his lawyer knew about the arrangement. 

Suggesting to Kwee that he “knew Karen was going to be made bankrupt soon after May 2022, Fong said the caveats filed by Kwee in May 2022 on both Bukit Timah properties were an attempt (by him) to save the properties from Karen’s creditors”.

In response, Kwee reiterated that the properties were his, and that his daughter was not the true and beneficial owner, and filing a caveat was “the appropriate action” to take. 

He said: “Obviously, this is my property, I have to protect (it).”

Both the King’s Drive and Teneriffe properties have, since 2023, been sold by their mortgagee banks, said court documents. But how the proceeds will be distributed depends on the outcome of the lawsuit.

The remaining three properties have not been sold. The trial, which runs over nine days in February, is expected to end on Feb 21.