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SINGAPORE – The long-running civil suits brought by two town councils against the leaders of the Workers’ Party have come to a close, with both sides announcing on July 24 that they had . Aljunied Hougang Town Council (AHTC) and Sengkang Town Council dropped their claims for damages and costs against WP chief Pritam Singh, party chairman Sylvia Lim, and former party leader Low Thia Khiang, as well as town councillors Kenneth Foo and Chua Zhi Hon. Likewise, the three WP leaders and two town councillors dropped their claims for costs against the town councils. The settlement comes seven years after the lawsuits were filed in 2017 over with its former managing agent FM Solutions & Services (FMSS). An independent panel appointed by AHTC had initiated the legal proceedings after an audit by KPMG in 2016 found that some $33.7 million in improper payments had been made to FMSS and its subsidiary. The Straits Times understands that FMSS, which was also sued by the town councils, has also reached a settlement with the town councils. Here is a timeline of how the saga unfolded: The Workers’ Party (WP) wins Aljunied GRC in the general election, as well as retains Hougang, which it has held since 1991. Shortly after, FMSS is formed. At around the same time, AHTC’s existing managing agent, CPG, informs the WP it wishes to terminate its contract early. WP formally takes over the running of AHTC, which appoints FMSS as its managing agent on a one-year contract. WP calls for a tender for managing agent services, and only FMSS submits a bid. WP wins Punggol East in a by-election. AHTC becomes Aljunied-Hougang-Punggol East Town Council (AHPETC). The Government directs the Auditor-General’s Office (AGO) to audit AHPETC’s accounts after the town council’s own auditor raises 13 issues of concern over its financial statements. The AGO releases a special report on major lapses at AHPETC, including the management of sinking funds and governance of related party transactions resulting from the owners of FMSS also being staff members of the town council. The report is debated in Parliament. WP retains Aljunied GRC and Hougang, but loses Punggol East in the general election. Punggol East becomes part of Pasir Ris-Punggol Town Council (PRPTC). AHPETC is reconstituted as AHTC. The Court of Appeal orders AHTC to appoint accountants, subject to the Housing Board’s approval, to look into its books. After AHTC’s nomination for accountants was rejected by the HDB, the Court orders AHTC to nominate an accountant from one of the “Big 4” firms, namely KPMG, Deloitte, Ernst & Young and PricewaterhouseCoopers (PwC). AHTC appoints KPMG. KPMG issues a report after its audit saying there are “serious flaws” in the town council’s governance, and highlights improper payments of $33.7 million to FMSS that were co-signed by conflicted persons or FMSS employees. Following KPMG’s report, AHTC appoints an independent panel chaired by Senior Counsel Philip Jeyaretnam to look into the improper payments. Accounting firm PwC – brought in by PRPTC to review past payments made in relation to Punggol East – releases a report that calls into question the propriety of all payments made under FMSS. AHTC, under the independent panel’s direction, initiates legal action against town councillors, including WP chief Low Thia Khiang and party chairman Sylvia Lim, as well as MP Pritam Singh, saying they have breached their fiduciary duties. The MPs deny the allegations. PRPTC also files a suit against the town councillors. The first part of the AHTC trial begins, to find out if five town councillors as well as FMSS and its co-owners are liable for the alleged improper payments. The High Court finds that the WP MPs and town councillors, as well as FMSS’ owners, have towards AHTC and the residents of the constituency. There will be a second round of hearings to assess and determine the damages suffered by the town council, and how much it can recover from the MPs, town councillors and FMSS. The WP MPs and PRPTC file appeals against the judgment, which had also ruled against some of the claims made by the town councils. AHTC submits clean audited accounts to the Ministry of National Development for the first time since 2011. The Ministry of National Development (MND) asks AHTC why it did not require Mr Low and Ms Lim to recuse themselves from financial decisions at the town council following the judgment. MND orders AHTC to in making certain financial decisions at the town council. AHTC complies with the order. in the general election, and also wins Sengkang GRC. Following changes to the electoral boundaries, Punggol East is now part of Sengkang GRC. Sengkang Town Council takes over the management of the lawsuit from PRPTC. AHTC’s lawyers make a bid to add to its statement of claims against Mr Singh and two others. The court rejects the application, but allows the town council to amend the claims against Mr Low and Ms Lim, as well as the owners of its FMSS. The court of five judges hears the appeals, and reserves judgment. The apex court issues a judgment that largely overturns the High Court judgment. It finds that the WP town councillors do not owe AHTC fiduciary duties and in the hiring of FMSS without an open tender. But it also finds that the town councillors were negligent in allowing conflicts of interest to persist at AHTC. The apex court issues a ruling on liability, which says that in the AHTC payments process as he was not given the chance to defend himself against the claim. Mr Low and Ms Lim are held liable for allowing control failures in the payments process. Following the court ruling, MND says it “will consider whether further regulatory action under the Town Councils Act is required to safeguard public monies entrusted to the town council”. The ministry asks AHTC what action it intends to take, particularly in relation to the duties and powers of Ms Lim and Mr Singh over payment and procurement processes. AHTC replies to MND and says it sees no reason to bar Ms Lim and Mr Singh from discharging their functions and duties as elected town councillors. MND says it will provide an update “in due course”. In a ruling on costs, the apex court finds the WP MPs have succeeded substantially in their appeals, and . In all, $351,965.62 in costs were awarded to Mr Singh, Ms Lim and Mr Low, as well as other town councillors, FMSS and its employees. They were also awarded $36,817.01 in disbursements for out-of-pocket expenses such as photocopying and filing fees. AHTC, STC and the WP town councillors announce that they have reached a settlement in the case. While there is no announcement from FMSS, The Straits Times understands that it has also reached a settlement with the town councils.