7 Legal disputes

(1) Civil Case of the Civil Court, Pre-trial case No. 6590/2534,
7822-26/2534 Post-trial case No. 17081-4/2542 between:

  Laguna (1) Co., Ltd. and the other 6 people as “Plaintiff”

  Tungkah Harbour Public Co., Ltd. and Seatran Mining Co., Ltd. as
  “Defendants”

  Background

In 1991 six co-plaintiffs who are subsidiary companies sued both
defendants in the offence of wrongful acts, causing injury to the
property. The total capital for the case is Baht 229,446,000. The cause
of the action was because between 1989-1991 the beach at Bangtao Bay
(Sub-District of Cherngtalay, District of Thalang, Province of Phuket),
which is adjacent to Laguna Phuket, was damaged by erosion which
encroached onto the plaintiff’s land. The Asian Institution of
Technology (“AIT”) has researched the matter and found that beach
erosion was caused by tin mine dredging in Bangtao Bay being too close
to the beach. Before the case was brought to court the co-operation of
the defendant had been sought, but without success. Therefore, we have
sued the defendants for the courts to judge the compensation to be paid
to the plaintiff and also to prevent further dredging closer than 2 km
to the beach. The defendants have exercised their right to defend
themselves in the proceeding trial of this case.

The judgement of the Court of First Instance

In December 1999, the Court of First Instance gave the judgement to
dismiss the plaint.

  The present circumstances

    Subsequent to the result of the Court of First Instance the company
    exercised its right of appeal to the Appeal Court.

After reviewing the case, the Appeal Court made an offer to the parties
to compromise on the case in order to reach a mutual agreement and find
a solution. Unfortunately, the negotiations failed and the case returned
to the Appeal Court for its judgement. On 29 March 2002, the Appeal
Court affirmed the judgement of the Court of First Instance. On 26 April
2002, the Plaintiff appealed the judgement to the Supreme Court. We are
now awaiting the judgement from the Supreme Court.

The opinion of the lawyer

After reviewing the documentary evidence submitted to the Court of First
Instance and the Appeal Court, there is a good chance that the Supreme
Court will reverse the judgement of the Court of First Instance and the
Appeal Court in favour of the plaintiff. We are quite confident that we
have sufficient evidence to support the case.

Executive Opinion 

The Company produced good faith evidence with the support of research
from AIT that the dredging by the defendant had caused beach erosion. We
believe there is strong evidence to support a reversal of the decision
by the Court of First Instance and the Appeal Court, and that it is
worthwhile to continue to pursue the case.

  Management are confident that the pursuit of this case has no effect
  on the Company’s ongoing operations, and is optimistic that the
  outcome will include a cessation of all future dredging in Bang Tao
  Bay.

(2) Criminal Case of the Provincial Court of Phuket, Pre trial case no.
    3496/2542 between

  Public Prosecutor “Plaintiff”

  Laguna Grande Ltd. “Co-Plaintiff”

  Mr. Akara Mumin “1^(st) Defendant”

  Mr. Suwit Chidchiew “2^(nd) Defendant”

  Mrs. Somporn Panmanee “3^(rd) Defendant”

  Background

We filed a report to the Cherngtalay subdistrict police station in
January 1999 for the trespassing on the title deed no. 5916 owned by the
co-plaintiff. The police performed an investigation and found the
defendants were trespassing on our land to conduct their business with a
view to taking possession of the land. After the investigation, the
inquiry officer prepared a prosecution order against the defendants. The
file of the case was then passed to the Phuket public prosecutor for
their order. The prosecutor then issued the prosecution order against
the defendants, as they believe that the defendants are guilty. In late
1999 we submitted the documents to be the co-plaintiff to this case to
obtain a judgement that requires the defendants to demolish their
construction from the disputed land.

  The present circumstance

  The case is in the process of taking the evidence in the Court of
  First Instance.

  The opinion of the Lawyer

Before the company became a co-plaintiff with the prosecutor to this
case, we were well prepared with strong evidence. Although it is
expected that it will take at least 2-3 years from now to receive the
judgement, we consider that the company shall prevail in this case.

  The Executive opinion

This case is one of several where we are protecting our land title
rights through the courts. It is routine, and should have no affect on
our ongoing operations.

(3) Central Administrative Court, Pretrail case no Case No. 3049/2544

  Mr. Deaw Chantawong “Plaintiff”

  Phuket Provincial Land Office “Defendant”

  Bangtao Development Co.,Ltd., “Co-Defendant”

  Laguna (3) Co.,Ltd., “Co-Defendant”

  Laguna Resorts and Hotels Public Co.,Ltd “Co-Defendant”

  Laguna Grande Co.,Ltd., “Co-Defendant”

  Laguna (1) Co.,Ltd., “Co-Defendant”

  Background

  On 7 August 2001, the Plaintiff brought the case to the Central
  Administrative Court against the Defendant and requested the Court to
  order the Defendant to revoke some land title deeds owned by Bangtao
  Development Co.,Ltd., Laguna Grande Co.,Ltd., Laguna (3) Co.,Ltd.,
  Laguna (1) Co.,Ltd. and Laguna Resorts and Hotels Public Co.,Ltd. The
  Plaintiff claimed that some title deeds under the ownership of the
  said companies have been issued improperly. Since the said companies
  will be directly bound by the court judgement they are Co-Defendants
  in this case.

The present circumstance

  The case now is under the consideration of the Central Administrative
  Court.

  The opinion of the lawyer

We consider that we have strong evidence to support this case. The land
titles in question were issued well before the Co-Defendants purchased
the land, which were subsequently purchased in good faith. Although it
is expected that it will take at least 1-2 years from now to receive a
judgment we are confident that we have sufficient evidence to support
the case.

  The executive opinion

This case is one of several where we are protecting our land title
rights through the courts. It is routine, and should have no affect on
our ongoing operations.