Park Hotel Management director Allen Law breached fiduciary duties: High Court

Mr Allen Law, the scion of Hong Kong-based billionaire Law Kar Po, was found to have breached his fiduciary duties and prejudiced the interests of creditors, while navigating his company Park Hotel Management (PHMPL) through financial challenges resulting from the Covid-19 pandemic.

- Grace Leong

According to a 165-page High Court judgment released on Aug 6, Mr Law, the sole director and shareholder of PHMPL, sold assets to himself at "gross undervalue" and diverted more than $32 million in cash and receivables for his benefit.

"When (Mr Law's) company was in financial peril, he transferred its viable assets and businesses (effectively) to himself at a gross undervalue and manipulated the books of the company to eliminate receivables owed by him and his entities, leaving the creditors with nothing," High Court Judge Hri Kumar Nair noted.

"Far from demonstrating selflessness, Mr Law showed contempt for his fiduciary obligations. While PHMPL may have failed because of events beyond his control, his response was entirely regrettable.

"He appropriated PHMPL's assets for himself and manipulated PHMPL's books to hide his subterfuge. His conduct, both in relation to the 'restructuring' and his defence of these proceedings, was dishonest and dishonourable. His first and only thought was to benefit himself," the judge said.

Mr Law and three other companies were sued by PHMPL and its liquidators over matters relating to assets sold to entities related to him before the company was placed in liquidation in July 2021 in the wake of the pandemic, which had devastated the hospitality industry globally.

The three defendant companies are Park Hotel Group Management (PHG), British Virgin Islands-incorporated Good Movement Holdings and Singapore Institute of Hospitality (SIOH).