Lee files petition to declare
Tang a bankrupt
Straits Times. Jan 7, 1998
BY Walter Fernandez
THE courtroom battle between Workers' Party member Tang Liang Hong and 11 People's Action Party leaders, which has lasted nearly a year already, resumed this week with Senior Minister Lee Kuan Yew initiating legal action to declare the opposition man a bankrupt.
Lawyers representing SM Lee have filed a bankruptcy petition in the high court against Mr Tang to recover some $740,000 in damages and interest, which he owes the PAP leader for defaming him several times in the run-up to and after last year's general election.
Mr Tang, who fled Singapore soon after the January polls and is now based in Melbourne, has remained defiant and has refused to pay the PAP leaders "even a single cent". Instead, he said he plans to start "fresh action" to strike out the judgments against him.
As Mr Tang is abroad, SM Lee's lawyers have obtained a court order allowing them to serve the bankruptcy papers on him by posting them at his house and advertising in newspapers here. The advertisements are expected to appear in the next few days.
Last year, Mr Tang was ordered by the high court to pay the PAP leaders, including Prime Minister Goh Chok Tong, both Deputy Prime Ministers Lee Hsien Loong and Tony Tan, and several ministers and MPs, about $4 million in damages and legal costs for defaming them.
If Mr Tang does not fork out the money which he owes SM Lee by Feb 6, the day this latest legal action is scheduled to be heard, he will be declared a bankrupt and all his material and financial assets will be turned over to the state's official assignee.
According to a PAP lawyer, the next step would be for the other PAP leaders to lodge proof with the official assignee that Mr Tang also owes them money. The official assignee will then value Mr Tang's assets and apportion them to his creditors.
The major asset up for grabs is the Tang family home -- a single-storey bungalow at 75, Hua Guan Avenue, valued at $4.5 million.
But the 30-year-old property, with an area of almost 8000 square feet, is the subject of yet another legal tussle.
Madam Teo Siew Har, Mr Tang's wife, claims the property belongs to her, since it is registered in her name, and should not be sold to pay off her husband's debts. The PAP lawyers, however, maintain that she is simply holding the property in trust for Mr Tang.
Even if the PAP lawyers prove that the property belongs to Mr Tang, the bungalow may no longer be worth $4.5 million. It is mortgaged to OCBC Bank for an overdraft of $3.2 million, leaving its unencumbered value in the middle of last year at about $1.3 million.
According to Madam Teo's lawyer, Mr Daniel John, even this value is depreciating steadily by $20,000 to $30,000 each month, because of the interest payments due on the overdraft. The high court is expected to rule on the bungalow's ownership by June.
Madam Teo had attempted -- with the approval of the receiver appointed by the high court to manage the couple's assets -- to sell the bungalow by tender last month. Despite nine tender notice advertisements in the Straits Times, no bids were received.
Mr John said no one was interested in buying the house because of the "poor property market outlook", but other lawyers and property agents contacted suggested that the cold response was possibly due to the "stigma attached to the property".
According to the initial receiver's report in March last year, Mr Tang's other assets include four life insurance policies worth about $180,000, his law practice valued at about $178,000, bank accounts with about $81,000 and another $24,000 in two office accounts.
Mr Tang also has three country club memberships, two cars and shares, but these are of no material value, said the receiver. The receiver, Mr Nicky Tan, is expected to file a fresh affidavit by Feb 26, listing any new assets which he has uncovered.
Mr Tang could not be reached for comment in Melbourne yesterday.