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A Sobering Lesson for Companies with Errant Employees – OUE Lippo Healthcare Ltd v Crest Capital Asia Pte Ltd [2020] SGHC 142

Veltrice Tan

[2021] SAL Prac 4

Abstract:
In OUE Lippo Healthcare Ltd v Crest Capital Asia Pte Ltd [2020] SGHC 142 (“OUE”), the Singapore High Court examined whether a corporate lender can be liable to a corporate borrower when the loan is misused by the latter’s officers. In OUE, a lender was found liable in conspiracy, in part due to the mental state of the lender’s errant employee which was attributed to the lender. This article seeks to analyse the practical implications of the High Court’s decision, and to provide suggestions for corporate lenders to avoid being liable for dishonestly assisting a corporate borrower’s fraudulent officers.