High Court rules Park Hotel director breached fiduciary duty

Ruling said he transferred assets for his gain, manipulated books to hide subterfuge.

A businessman and hotelier was found to have breached his fiduciary duties to his company, Park Hotel Management (PHMPL).

According to a Singapore High Court judgment released on 6 Augus, the hotelier sold assets to himself at “gross undervalue” and diverted more than $32.5m in cash and receivables for his benefit.

As the sole shareholder and director of PHMPL, he was also found to have “manipulated the books of the company to eliminate receivables owed by him and his entities, leaving the creditors with nothing,” the ruling said.

The hotelier and three other companies were sued by PHMPL and its liquidators over matters relating to assets sold to companies under his control before the PHMPL was placed in liquidation in July 2021 in the wake of the Covid-19 pandemic.

“Far from demonstrating selflessness, [he] showed contempt for his fiduciary obligations – his breaches are beyond peradventure. While PHMPL may have failed because of events beyond his control, his response was entirely regrettable. He appropriated PHMPL’s assets for himself and manipulated PHMPL’s books to hide his subterfuge,” High Court Judge Hri Kumar Nair said in the ruling.

“His conduct, both in relation to the “restructuring” and his defence of these proceedings, was dishonest and dishonourable. His first and only thought was to benefit himself,” the High Court judge added.