23/07/2008 The Star By Priscilla Dielenberg

GEORGE TOWN: A proposed RM500mil high-rise project in the heart of the heritage city here may be in jeopardy now that a High Court has stopped the sale of a 6,654 square metre piece of land smack in the centre of the project.

Justice John Louis O’Hara yesterday ordered that the trustees of landowner Elceetee Trust D be restrained from selling or dealing with the property on Beach Street and that developer Asian Global Business Sdn Bhd be restrained from proceeding with the purchase.

The judge granted the inter-partes interlocutory injunction with costs to four beneficiaries of the trust, sisters Lim Beow Hong and Lim Poh Hong and their brothers Lim Poh Leng and Lim Sin Leng who are all residing in Singapore, and intervener plaintiff Jennifer H. Garner as the executrix of the estate of their cousin Peggy Lim Beow Suan, pending the hearing of the suit proper.

The plaintiffs are among 15 beneficiaries of Elceetee Trust D created by their late grandfather, Penang’s first millionaire industrialist Lim Cheng Teik, by way of a deed dated May 2, 1950.

The plaintiffs had filed a summons in chambers for the injunction on grounds that the trustees were in breach of trust in signing a sale and purchase (S&P) agreement dated Nov 20, 2007 with the developer for the sale of the property at RM17.85mil,that the trustees were obliged to transfer the property to the respective beneficiaries pursuant to a High Court order dated March 2, 1999, and that the transaction in the S&P agreement was not an arm’s length transaction.

They had named as defendants the trustees Lim Kean Giap, William Ng Jit Thye, Goon Heeng Siak and Lim Tong Choon, and Asian Global Business in their suit for conspiracy and fraud.

The plaintiffs are claiming that the defendants had unlawfully conspired to defraud and deprive them of their rightful entitlement.

They are seeking a permanent injunction, and declarations that the trustees were in breach of trust in the discharge of their duties, that the sale of the property was not an arm’s length transaction, and that it was null and void.

They are also seeking damages for conspiracy and fraud, and damages for breach of trust from the trustees, the disqualification of any of the trustees who have been held to be in breach of their duties, costs and further relief.

In its defence, the trustees averred that they had absolute power to sell the property, and the sale was pending completion.

They said they were selling the property at a very good price and that the surrounding land had been sold at a lower price. They said four valuations had been carried out over the past 10 years and the last valuation in 2007 placed the property at a value of RM17mil with vacant possession.

The developer refuted the plaintiffs’ claim and put them to proof of the allegations.

Counsel Daphne Choy represented the four plaintiffs and Wong Yee Chue appeared for the intervener. The trustees were represented by Lee Khai and S.S. Tham, while L.A. Gomes appeared for the developer. The matter will now proceed for case management in preparation for trial.