The can of worms that is the PGCC controversy

From all the furore over the controversial multi billion Penang Global City Centre (PGCC) project to the disclosure that it was not even approved yet to hints that it may be one of the largest land scams ever and now legal battle in Penang Turf Club because of this project.

Looks like this project is doomed to be dragged through the courts and to also receive the most negative publicity over these two months after its grand launch back in Oct last year!

The latest update on Malaysiakini on this piece of prime land over at Batu Gantong sees a suit by Penang Turf Club ordinary members Tan Sri Tan Kok Ping and Datuk Lee Choon Hoe against the club committee members "over the deal made with developer Abad Naluri Sdn Bhd to develop the controversial PGCC" (read the news here) and the committee members refuting their claims.

I daren't write much more about this whole issue less I too get dragged into the courts for contempt or whatever, so here is the news and chronology of events regarding the whole PGCC debacle from Malaysiakini:

PGCC imbroglio: Turf Club breaks silence, refutes allegations
May 24, 08 5:23pm

Push has finally come to shove for the Penang Turf Club (PTC) when it broke its long silence today over numerous allegations made by several ordinary members.

In a statement today, the club’s assistant general manager and secretary Leow Khin Ming said PTC has decided to refute the allegations made against them by Tan Kok Ping over the proposed relocation of the club to Batu Kawan in order to prevent confusion among club members and the public.

“The decision to relocate the club from its present site to Batu Kawan was made by the majority of club members at a duly convened extraordinary general meeting held in November 2002.

“(Kok Ping) should not attempt to impose his personal views on the majority decision of club members,” he stated.

Yesterday, Kok Ping and fellow ordinary member Lee Choon Hoe in their own capacity and on behalf of all club members sued the PTC committee members and several others over the deal made with developer Abad Naluri Sdn Bhd to develop the controversial Penang Global City Centre (PGCC).

The suit named PTC committee members Ong Eng Khuan, Robert Chan Woot Khoon, Dr Henry Ooi Kwee Lim, Oon Chong Kie, John Alexander Rodgers, Seow Chin, Tan Phaik Guan, Teh Choon Beng, Ch’ng Chin Ghee, club consultant Muhammed Rizal Abdullah, club financial controller Tan Hock Lim and club assistant general manager and secretary Leow Khin Ming as defendants.

Prior to that, Kok Ping and 12 other ordinary members of the turf club lodged a police report on May 8 alleging that the PTC committee had abused its powers in its dealings with Abad Naluri.

In both actions, Kok Ping alluded that some 580 ordinary members of the well-established horse racing club had been kept in the dark over several agreements signed between the PTC and Abad Naluri.

In 2003, PTC and Abad Naluri signed a preliminary agreement for the sale of some 260 acres of the club’s land for RM488 million in order to develop the PGCC.

Abad Naluri was expected to raise that sum and manage the financing for several years before the PGCC project starts contributing back.

From the RM488 million, RM375 million was designated to build a new racecourse in Batu Kawan in the mainland, relocating PTC’s existing racecourse on the island's prime Batu Gantong land while the remaining RM113 million would be paid to PTC in cash.

However, this agreement had allegedly lapsed and Abad has paid only RM10 million in advances to PTC so far.

Subsequently, a formal agreement was signed on May 12, 2004 which restructured several clauses in the preliminary agreement. Another supplementary agreement was inked on April 1 this year that granted Abad Naluri a renewable extension of three years in fulfilling their contractual terms.

He claims that the committee - as trustees of the club - breached its fiduciary duties and abused their power in selling the premier land without considering its members' interest.

Allegations refuted

Despite the numerous allegations made by Kok Ping, Leow specifically refuted the following:

• Kok Ping recently stated that the Batu Gantang racecourse is a well-known landmark in Penang and that it was a real shame to destroy an iconic heritage.

PTC rebutted saying Kok Ping and his friends have attempted to convince members to develop bungalow units for sale at the club’s present site and use the new profits to build a new racecourse in Batu Kawan since April 2008.

“This is contrary to his public stance that the club should be maintained as an iconic heritage,” said Leow.

• Kok Ping said that he voted against the extraordinary general meeting resolution (to relocate the club) when it was mooted in 2002.

PTC noted that there are no records in the minutes of Kok Ping having spoken against the resolutions but there were other minority members who had opposed the move.

• Liew pointed out that one of the resolutions was to pay every ordinary member RM20,000 each for hardship when the racecourse is relocated to Batu Kawan.

“Three cheques amounting to RM20,000 were sent to Kok Ping in his name and according to the club’s bank statements, these cheques were cleared,” said Leow.

• Kok Ping alleged that the PTC president and two of his staff members signed a supplementary agreement which granted a renewable extension of three years till March 2011 for Abad Naluri to complete building the new racecourse in Batu Kawan.

PTC argued that the club committee did not renew the 2004 agreement with Abad Naluri by a supplementary agreement in 2008. Instead, they “merely imposed a definite time frame for the completion of the new race course in Batu Kawan by March 2011".

“If the PGCC project cannot be carried out for any reason by Abad Naluri, then the committee and members of the club can consider any new proposal for the development of the club by open tender,” said Leow.

• Kok Ping expressed he did not have the intention of running for the PTC presidency or for a committee post.

PTC noted that in 1992, Kok Ping tried unsuccessfully to get elected to the club’s committee. Also, in 1993, he was part of the ‘vision’ team that sought election to the club’s committee but he was defeated.

Leow explained that the club did not want to engage in a media war with Kok Ping because many of his accusations are subject matter of a police report which he lodged.

He said the PTC was also advised by its lawyers to respond fully to all the inaccuracies and disinformation once the police had completed the probe.

The RM25 billion PGCC project has been plagued by controversies after it was launched by Prime Minister Abdullah Ahmad Badawi last year.

This include the revelation that the project has not been approved by local government agencies and locals protesting against the massive development in the already-dense island state.