Port Klang Authority’s (PKA) bid to claim part of its losses amounting to more than RM2 billion related to the Port Klang Free Zone (PKFZ) debacle have all but disappeared.
Despite the ruling by the High Court in Shah Alam in September 2018 that its former general manager was liable for the losses, she has been declared a bankrupt.
The High Court in Kuala Lumpur declared Phang Oi Choo @ Phang Ai Tu, also known as OC Phang, a bankrupt on Aug 17, 2019, following a petition from 21 former directors of PKA.
This means PKA will not be able to recover the RM2.6 billion and over RM200,000 as costs assessed by the court after Phang was found liable for, among others, breach of fiduciary duties and mismanagement.
According to records from the Insolvency Department, the bankruptcy petition was moved by the group, including two former ministers – Ting Chew Peh and Khor Chee Heung.
It was claimed that she had not paid the RM80,000 costs awarded when she unsuccessfully applied to cite the directors as third parties to the original civil suit filed by the PKA 11 years ago.
The others include former Serdang MP Yap Pian Hon and executive chairperson of Westports, senior government servants and members of political parties.
In the insolvency papers, Phang’s address is listed as in the upmarket area of Bukit Bandaraya in Bangsar, Kuala Lumpur.
On Oct 8, 2009, the Port Klang Authority filed a suit against Phang for breaches in her fiduciary, contractual and common law duties to the organisation.
The PKA chairperson (at that time) Lee Hwa Beng said that Phang was one of the central figures who oversaw the implementation of the PKFZ project. She was PKA’s general manager from 2001 to 2008 and was also PKFZ executive chairperson.
The PKA suit claimed that Phang had failed to exercise due care, diligence and skill in the discharge of her duties as the general manager by, among others, failing to comply with Treasury guidelines and failing to ensure that key agreements entered into by PKA contained adequate terms necessary to safeguard its interests.
On Sept 24, 2018, in finding for PKA, Justice M Gunalan ruled that Phang had committed 11 of the 15 purported breaches listed by PKA.
The judge concurred with PKA’s contention that it being a statutory body, Phang owed her duties to PKA as its general manager, and as such, cannot in law bypass the board of directors and rely solely on sanctions of the Transport Ministry, Finance Ministry and the prime minister to enter into the agreements which were binding on PKA.
Lee and another director, M Rajasingam, had moved a resolution in 2010 to sue all former directors, but it hit a snag when Kong Cho Ha, who took over from Ong Tee Keat, overruled the move. Both were not re-appointed to the board subsequently.
Phang caused a shock in early September 2009 when Parliament’s Public Accounts Committee (PAC) chairperson Azmi Khalid revealed that “she didn’t even know what we mean by cash flow projection”.
The revelation came when Phang testified for over four hours to PAC, which conducted its own inquiry into the PKFZ fiasco.
Azmi had then also said PKA allowed the cost of the project to escalate, as it did not have any business or financial plans to fall back on. – Malaysiakini