Granddaughter of Hin Leong founder O.K. Lim fails to keep 3 insurance policies from creditors’ reach

The daughter of bankrupt former Hin Leong Trading director Lim Chee Meng failed in a bid to shield three AIA Singapore insurance policies worth over half a million dollars from being part of Mr Lim’s bankruptcy estate.

Ms Michelle Lim Yan Yi, the granddaughter of Hin Leong founder Lim Oon Kuin, sought a High Court declaration that the three policies, worth over $521,000, should be ring-fenced from creditors’ reach because they were held on trust for her benefit by her father, who was declared bankrupt in December 2024.

The three policies are part of a set of eight insurance policies with AIA that Mr Lim Chee Meng had taken out when Ms Lim was a minor, under which he was the policy owner and she was the named insured.

But High Court Judicial Commissioner Mohamed Faizal found there was a lack of evidence of an intention on Mr Lim’s part, prior to his bankruptcy, to create a trust over the three policies for the sole benefit of his daughter.

He found that the documentary evidence relied on by Ms Lim was “either self-interested representations” or “mere assertions”.

One document she relied on was an October 2021 letter from Mr Lim to ring-fence the eight policies from other assets that were subjected to a freezing order in a US$3.5 billion (S$4.45 billion) civil suit.

Another document adduced was an AIA letter dated October 2021 signed by a purported personal wealth manager, who asserted that “the eight policies belong to (Ms Lim), and are being held by Mr Lim Chee Meng on trust for (Ms Lim)”.

Ms Lim contended that the AIA letter would not have been issued unless her father had clearly conveyed his intention to create a trust.

But the judicial commissioner found “the letter was bare and bereft of details and merely asserted, without more, that the eight policies were held on trust”.

Other documents Ms Lim relied on included an e-mail dated March 10, 2025, from Mr Lim to the trustees and part of his affidavit filed in 2024 for his bankruptcy proceedings, in which he asserted that he held the eight policies on trust for Ms Lim.

But the judicial commissioner pointed out that most of the documents she relied on as evidence were written by or on behalf of her father after his bankruptcy proceedings started.

“By that time, it would have been apparent that Hin Leong’s collapse could have extremely far-reaching financial consequences for all concerned, not least Mr Lim who was a director.”

The judicial commissioner noted: “It was at this point that Mr Lim started to insist that the eight policies were in fact not owned by him and should be deemed to be held on trust.”

He pointed out: “The courts should be wary of such belated attempts by bankrupts to shield assets from creditors by retrospectively asserting the existence of trust arrangements without contemporaneous evidence.”

Mr Lim, along with his father and sister Lim Huey Ching, was declared bankrupt in December 2024, following a settlement of two lawsuits brought by Hin Leong’s liquidators and HSBC against the Lim family.

Their bankruptcy estates are being managed by trustees Leow Quek Shiong and Seah Roh Lin of BDO Singapore, who have taken the position that the three insurance policies vest in Mr Lim’s bankruptcy estate.

The trustees had asked Mr Lim and Ms Michelle Lim whether a third party would pay the bankruptcy estate the surrender value of the three policies, which was worth over $521,000 as at Jan 16.

If no third party would pay for them, the trustees would then terminate the policies and use the proceeds to pay his creditors. But Mr Lim and his daughter did not agree to this arrangement.

Ms Lim claimed that her father intended to hold these policies on trust for her until she turned 21 years old, after which he would transfer the policies to her name.

But the trustees contend that while the policy documents do identify Ms Lim as the insured, they do not name her as a beneficiary.

The trustees also pointed out that Mr Lim’s actions were “inconsistent with any intention to create a trust for Ms Lim since he did not take the necessary steps to vest the three policies in her name when she turned 21”, despite having the opportunity to do so.

The trustees noted that AIA had written to Mr Lim on June 13, 2024, to indicate that its records showed he wished to remain the policies’ owner when Ms Lim turned 21, but they were writing to him just in case he wished to change the state of affairs.

The judicial commissioner noted that Mr Lim “chose to ignore the (AIA) letters altogether”.

Further, he also did not file any affidavit to support his daughter’s case.

“While I accept that the absence of direct evidence from Mr Lim is not determinative, such absence necessarily raises obvious and legitimate questions about the credibility and completeness of (Ms Lim’s) claim,” the judicial commissioner noted.

Source: The Straits Times © SPH Media Limited. Permission required for reproduction.

Lim Yan Yi Michelle v Leow Quek Siong and another [2025] SGHC 118

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