Restitution

• Author: YEO TIONG MIN LLB (National University of Singapore), BCL, DPhil (Oxford), Advocate and Solicitor (Singapore) Associate Professor, Faculty of Law, National University of Singapore
• Published date: 01 December 2003
• Citation: (2003) 4 SAL Ann Rev 376
• Date: 01 December 2003

Introduction

19.1 In contrast to 2002, which was an exceptionally bountiful year for the law of restitution in Singapore, 2003 has seen far fewer cases in this subject area. One important case, Parkway Properties Pte Ltd v United Artists Singapore Theatres Pte Ltd[2003] 2 SLR 103, was decided in early 2003 and has been noted in (2002) 3 SAL Ann Rev at paras 19.67 to 19.79 in view of its significance in relation to other cases noted for the year 2002, including the judgment from which the appeal was heard ([2003] 1 SLR 791). Apart from this case, the law reports and LawNet database reveal only three Supreme Court decisions decided in 2003 which contained any notable discussion on the law of restitution. One dealt with statutory contribution, and in two others, restitutionary claims, which were pleaded in the alternative to contractual claims, failed. The latter two cases provide interesting studies on the relationship between the law of contract and the law of restitution.

Quantum meruit

19.2 A restitutionary claim was rejected in Grossner Jens v Raffles Holdings Ltd[2004] 1 SLR 202. The plaintiff, G, had offered to broker a deal for the sale of Swissotel Holding AG (‘Swissotel’) to the defendants, R. G”s proposal for one per cent of the transaction price as broker”s commission, due upon the acquisition of Swissotel by R, was not accepted by R. Pursuant to R”s request for more information on the scope of brokerage services to be provided and the indicative price for Swissotel, G sent R some publicly available information on Swissotel and its subsidiary. G also arranged one meeting between representatives of R and those of the owners of Swissotel. Subsequently, Swissotel was put up for sale by its owners under competitive tender, and R managed to acquire Swissotel in that way. G then demanded his commission from R. R disputed G”s entitlement, and offered instead an ex gratia‘introduction fee’. G refused to accept it, and instituted legal proceedings.

Contractual and restitutionary quantum meruit

19.3 It appeared from the judgment that G”s arguments were two-fold. First, G had argued that he was entitled to a one per cent commission as a matter of contract. Secondly, and in the alternative, G had argued that he was entitled to claim a reasonable sum for services rendered (quantum meruit) in restitution. Both claims were dismissed by Tan Lee Meng J. The judge found that, on the facts, no brokerage contract had been formed, and that, in any event, even if there had been a binding contract, the commission was only payable if G had succeeded in brokering a private sale of Swissotel to R, but the sale was in fact concluded through the competitive bidding process. There was a dispute as to what had transpired at the initial meeting arranged by G, but the court found as a fact that there was no discussion of the sale of Swissotel.

19.4 What is of greater interest for the purpose of this chapter of the annual review is the judge”s dismissal of the claim for quantum meruit. Taking the cue from the Court of Appeal in Lee Siong Kee v Beng Tiong Trading, Import and Export (1988) Pte Ltd[2000] 4 SLR 559, the judge approached the claim on two hypotheses: first, that it was contractual, and second,, that it was restitutionary. The earlier Court of Appeal decision had identified that a claim for quantum meruit can be based on two legal theories. Firstly, there may be a contractual agreement to provide services for remuneration which failed to provide for details of the rate of payment or even for the work to be done. In such a case, the analysis follows contractual doctrines. Secondly, a quantum meruit claim may not be founded on a contract, but may be based on restitutionary principles.

19.5 On the contractual quantum meruit claim, Tan J held that even if there had been a contract, the terms provided that the commission was due only if G had succeeded in brokering the sale of Swissotel to R, and this had not been proven to be the case. The court will not imply a promise to pay reasonable remuneration otherwise, in the face of express terms in the contract.

19.6 Tan J then dismissed the restitutionary quantum meruit claim, made on the basis that there was no contractual basis for the claim, for two reasons. Firstly, the services rendered were not of a kind that merited remuneration. The judge found that the information G had sent to R was in the public domain, that the sale was not discussed at...