WP’s Sylvia Lim used ‘fictional verbal agreement’ to justify waiver of EMSU contract, says lawyer
On Oct 23, 2018, Ms Sylvia Lim from the Workers' Party had to answer questions in court related to a verbal agreement made between Aljunied-Hougang Town Council and a service provider, as well as specifications for a contract awarded to a managing agent.
SINGAPORE — Workers’ Party (WP) chairman Sylvia Lim had created a “fictional verbal agreement” to avoid calling a tender and to secure FM Solutions and Services (FMSS) as the service provider for the constituency’s Essential Maintenance Services Unit (EMSU). Senior Counsel Davinder Singh made this charge in court on Tuesday (Oct 23) when cross-examining Ms Lim.
The lawyer also pointed out that there was no written agreement to spell out specifications of the EMSU contract awarded to FMSS. The specifications were left “uncertain” in an internal email from Ms Lim.
FMSS was then the managing agent for Aljunied-Hougang Town Council (AHTC), and EMSU is a 24-hour service provided by town councils to attend to residents’ urgent and maintenance requests such as breakdown in power supply or lift failures.
Ms Lim, an opposition Member of Parliament, is one of eight defendants being sued by Pasir Ris-Punggol Town Council (PRPTC) and an independent panel acting on behalf of AHTC, for alleged improper payments made to FMSS and third-party service providers. Mr Singh is representing PRPTC.
The court heard that the “verbal agreement” between AHTC and one of its two existing EMSU service providers, CPG Facilities Management, was mentioned in Ms Lim’s email on Sept 18 in 2011, sent to elected MPs at the time and members of the tenders and contracts committee.
This agreement was said to have stated that CPG was “willing to extend” its contract for six months till March 2012.
However, in the same email, Ms Lim said CPG sprung a “surprise” on Sept 14, 2011, which went against their “verbal agreement” by stating that they would not be extending their services. She requested that the council approve a waiver for a tender for the EMSU contract, which was expiring at the end of Sept 30, 2011, stating that there was no time to call for a tender for a new contract.
WAS THERE A VERBAL AGREEMENT?
Pressed for details of the “verbal agreement”, Ms Lim — who was on the stand for the fourth day — said it arose from discussions between CPG's managing director Jeffrey Chua and FMSS' co-owner How Weng Fan, who was AHTC’s general manager and deputy secretary. Ms Lim said she was not involved in negotiations.
She could not confirm the date of the “verbal agreement”, and when Ms How had reported it to her.
Mr Singh then highlighted that Ms How’s affidavit did not have any mention of a “verbal agreement” with Mr Chua. “That’s so strange, isn’t it, that the person herself doesn’t claim that there is such a verbal agreement,” Mr Singh asked.
Ms Lim replied that she found "strange as well”.
Mr Singh went on to say that there was no record of any correspondence to confirm the agreement, and that it was not raised in a Sept 8, 2011 meeting with the town council.
“Ms Lim, you had decided once again to create a fiction to justify not calling a new tender," the lawyer said. "You created that urgency on the basis of a fictional verbal agreement, blamed CPG, and then used that to ask for a waiver of the tender." Ms Lim disagreed.
Mr Singh also pressed Ms Lim on why she did not take any steps to prepare a tender to award the EMSU contract, since she had four months between June and September to do so.
Ms Lim did not have an answer, but said she and her fellow town councillors “could have taken those steps”. She agreed that there would have been enough time to call for a tender if she had begun the process from June 2011.
Mr Singh noted that she had treated FMSS as a contingency plan for the managing agent contract in case CPG bailed out, but that there was no such plan in place for the EMSU contract. He then put it to her that she had treated FMSS as the “backstop” to provide EMSU services, which she denied.
NO WRITTEN AGREEMENT
Mr Singh also charged that Ms Lim had breached the Town Councils Financial Rules as there was no written agreement for the EMSU services with FMSS. Section 76(4) of the rules states that “specifications” must be approved by a town council committee for a waiver to be valid.
The lawyer singled out an ambiguity in Ms Lim’s email discussing specifications for FMSS’s services, where she stated that the fees to FMSS should be “about the same” as the monthly combined fees of S$70,110 charged by CPG and EM Services (the other existing EMSU service provider). Mr Singh said that Ms Lim was “contented to leave things uncertain”.
He then questioned how the town council could be “protected” if there was no written contract containing the specifications.
Ms Lim replied: “FMSS accepted the terms we wanted, but it was not written out in a document signed by both parties.”
To that, Mr Singh raised the point that the rules are there to ensure the contract would protect the interest of the town council.
FMSS’ CONTRACT LEFT OUT KEY TERMS
Earlier in the day, Mr Singh said Ms Lim had not protected the interests of the town council as she did not incorporate the entire content of the CPG contract into that of FMSS.
He referred the court to the report Ms Lim prepared for the Aug 4, 2011 meeting to officially appoint FMSS as AHTC’s new managing agent after CPG’s dismissal.
She had stated then that FMSS’ scope of work would follow “specifications” stipulated under CPG’s contract.
Mr Singh said that meant incorporating only one out of seven parts of the full CPG contract, and that key terms such as clauses covering circumstances for the termination of FMSS were left out.
However, Ms Lim said that she and her fellow town councillors understood “specifications” to mean the entire CPG contract would apply “as far as possible”. This was because it was known that FMSS was “stepping into the shoes of CPG” to carry out a year of managing agent services under a waiver, she added.
Mr Singh then said that her evidence was “again concocted”: “You realised that it was an irresponsible thing to do, and so have now come out with this notion that everything was adopted.”
The lawyer also noted that the town council’s decision-makers, including fellow Member of Parliament Low Thia Khiang, were not given the CPG contract, and that they did not refer to it when they signed off on the “specifications” for FMSS.
Thus, no one was aware that the contract had various parts, and did not ask whether “specifications” meant a specific section or the entire contract.
“You completely compromised the interest of the residents by entering into an arrangement with FMSS, which did not, in its face, incorporate the entire contract,” he said.
Mr Singh is expected to end his cross-examination of Ms Lim on Wednesday.
