Minority shareholder being sued for defamation says comments against Stamford Land were justified and ‘fair’

SINGAPORE — Mr Mano Sabnani, minority shareholder of hotel developer and owner Stamford Land Corporation, maintained that his statements made about the group and its directors were justified. His defence submissions were made to the High Court on Sunday (Sept 30).

Mr Sabnani is being sued for defamation by the company and five of its directors after he made statements at two annual general meetings (AGMs), in a Facebook post and a letter to The Business Times.

Mr Sabnani’s lawyers said their client, who has owned 60,000 shares in the listed Singapore company since November 2012, had “qualified privilege” to question its management at its AGMs in 2016 and 2018 regarding its low dividend payout and high remuneration for senior office-bearers.

The rare lawsuit has caused concern among shareholders. At the AGM of the Singapore Exchange last month, Singapore Exchange Regulation chief executive Tan Boon Gin said it encourages parties “not to take an overly legalistic approach”.

“Generally, we encourage a free and frank discussion between the board and shareholders at AGMs ... We encourage all parties to focus on the issues and not personalities,” Mr Tan had said.

Mr Sabnani’s remarks were “fair comment”, argued lawyers Abraham Vergis and Zhuo Jiaxiang of Providence Law Asia.

Their client is a full-time investor in the Singapore equity markets, a writer and regular Facebook commentator on current affairs and financial issues.

In 2016, Mr Sabnani “had a legitimate duty and/or interest to communicate” his views on Stamford Land’s announcement of a drastic cut in the dividends to be paid, from three cents per share in the 2015 financial year, to 0.5 cents per share in the 2016 financial year.

That was why the veteran investor cast doubts on the signals it would send to the market, and compared it to beleaguered offshore and marine group Swiber Holdings, said his lawyers.

Mr Sabnani was making “a reasonable inference based on fact”, Mr Vergis and Mr Zhuo wrote.

Swiber Holdings had stopped paying dividends after 2012 and had later gone downwards financially before going into liquidation, they said.

“The defendant’s comment was that a sudden and drastic dividend cut would send a negative signal to the market and be interpreted as such by an ordinary and fair-minded person,” they added.

The lawyers similarly argued that Mr Sabnani had a “legitimate duty” in the 2018 AGM, which was held on July 27, to ask why Stamford Land executive chairman Ow Chio Kiat was paid S$5 million, which is three times the combined total of what the company’s five top executives were earning.

They added that his comments were framed as questions, which “cannot be construed as assertions of fact”.

As for Mr Sabnani’s comment that there was “real suppression” of a minority shareholder, the lawyers said it is a fair comment “based on the fact that the plaintiffs kept attempting to switch off the defendant’s microphone and telling him to ‘sit down’”.

Mr Ow had also interrupted Mr Sabnani, accusing the shareholders present of trying to “create a riot”, labelling Mr Sabnani's questions as “complaints”, telling him to stop “rambling on and on” and calling him a “disruption” to the meeting, the lawyers cited these examples as background information.

Mr Sabnani wrote a Facebook post titled, “Abhorrent board behaviour at Stamford Land AGM”, on the same day. It was his way of expressing how he “was made to feel unworthy, unwelcome and strong-armed by the cavalier and condescending attitude of (Mr Ow) — just for asking a few questions”, which were neither corrected or countermanded by other members of the board, they said.

“They were fair comments on a matter of public interest, namely, the corporate governance of a public-listed Singapore company,” said the lawyers.

Mr Sabnani then had a letter published in the Business Times expressing his dismay on July 31. “The (Business Times) article was a fair and accurate report of the proceedings at a general meeting by a public-listed company in Singapore,” the lawyers noted.

They rejected Stamford Land’s claims that Mr Sabnani’s actions harboured malice or ill will. He took down his Facebook post as a “gesture of goodwill” at the demand of Stamford Land’s lawyer, even though he was “legally entitled” to retain it, they said.

Stamford Land is represented by Mr Nandakumar Renganathan and Ms Luo Ling Ling of RHTLaw Taylor Wessing. In papers served on Sept 7, they stated that Mr Sabnani had, in the 2016 AGM, said that Mr Ow and lead independent director Vaile Mark Anthony James — formerly Australia’s deputy prime minister — “ran (the company) to (the) ground”.

The lawyers also alleged that Mr Sabnani called Mr Ow out for being corrupt and dishonest, saying he was “deliberately depressing” the share price of Stamford Land through a low dividend payout in order to privatise it.

They claimed that Mr Sabnani had accused Stamford Land of acting improperly by exploiting shareholders and deliberately declaring lower dividends for its shareholders, while enriching its directors by paying them undeserved remuneration at the expense of shareholders.

Mr Sabnani had implied “by way of innuendo” that Mr Ow oppressed the firm’s minority shareholders, and that the directors have not acted with reasonable diligence, among other comments, Stamford Land’s lawyers said.