Case Note: EFFECT OF THE AMENDMENT TO ORDER 14 RULE 1 ON CLAIMANTS RELYING ON ARCHITECT’S CERTIFICATES

• Citation: (2004) 16 SAcLJ 256
• Date: 01 December 2004
• Author: CHAN Hock Keng LLB (Bristol); Advocate and Solicitor (Singapore).
• Published date: 01 December 2004

Samsung Corp v Chinese Chamber Realty Pte Ltd [2004] 1 SLR 382

In cases where architects’ certificates are disputed and there is an agreement to arbitrate such disputes, the plaintiff and the defendant are likely to apply for summary judgment and stay of proceedings respectively. This case highlights how the 2002 amendments to the O 14 rules of the Rules of Court have resulted in the discontinuance of the Registry’s practice of fixing the stay and O 14 applications to be heard together. With the pronouncement of the Court of Appeal as to the proper procedure to be adopted in such cases under the amended O 14, it is clear that a defendant, who wishes to stay legal proceedings in favour of arbitration, is entitled to insist that the stay application be finally resolved first, before the plaintiff can (where appropriate) proceed to apply for summary judgment.

I. Introduction

1 Prior to the amendment of O 14 r 1 of the Rules of Court (Cap 322, R 5, 1997 Rev Ed) in late 2002, a plaintiff could apply for summary judgment once the defendant had “entered an appearance in the action”. If the plaintiff applied for summary judgment, the defendant was not required to file his defence until the summary judgment application was finally determined1 and leave to defend was granted.

2 In late 2002, O 14 r 1 was amended and a plaintiff can now only apply for summary judgment after the defendant has “served a defence to the statement of claim”.2

3 Authorities on the O 14 r 1 (pre-amendment) suggest that, generally, litigants should apply for summary judgment promptly and where possible before any defence is delivered.3 Thus, while a plaintiff was entitled to wait for a defendant to file his defence before deciding whether or not to apply for summary judgment, he would have to provide a good explanation if there was any undue delay in taking out the application.4

4 In the field of construction law, a party who sues on an architect’s certificate (especially one issued under the Singapore Institute of Architects (“SIA”) standard conditions) would usually apply for summary judgment shortly after the defendant enters an appearance. This is because the SIA standard conditions contemplate that “in the absence of fraud or improper pressure or interference by either party, full effect by way of Summary Judgment or Interim Award or otherwise shall … be given to all decisions and certificates of the Architect”,5 otherwise known as the temporary finality of such certificates.

5 In situations where the other party disputes the claims or architect’s certificate, he is likely to also rely on the arbitration clause in the SIA standard conditions6 to apply for a stay of proceedings.

6 In the pre-amendment situation, where there were both summary judgment and stay applications pending, the practice in the Registry was to allow the two applications to be fixed to be heard at the same time7 as there would usually be considerable overlap in the arguments.

7 However due to the amendment to O 14 r 1 (where a plaintiff can only apply for summary judgment after a defence has been filed), the pre-amendment practice of fixing both applications together would no longer be possible as s 6 of the Arbitration Act (Cap 10, 2002 Rev Ed) provides that a stay application has to be filed before the defendant delivers any pleading (which would include a defence) or takes any other steps in the proceedings.8

8 Therefore, in the post-amendment situation, prima facie, the defendant would be at liberty to apply for a stay of proceedings once he has entered an appearance but the plaintiff would not be able to apply for summary judgment until the stay issue is finally resolved since the defendant will not file a defence when his stay application is pending.

9 The effect of the amendment of O 14 r 1 to the practice of fixing both the summary judgment and stay applications to be heard together arose in the case of Samsung Corp v Chinese Chamber Realty Pte Ltd.

II. Background

10 The present case was a typical construction dispute. Briefly, the plaintiff/respondent was the developer of a building and the defendant/appellant, the main contractor. Due to delays to the project, the architect issued a delay certificate in favour of the plaintiff and the plaintiff relied on the delay certificate to claim against the defendant for liquidated damages. The defendant refused to honour the delay certificate and the plaintiff instituted the court action to compel payment. The defendant entered appearance and applied for a stay on the ground that there was an arbitration clause. As a result of the amendment to O 14 r 1, the plaintiff was unable to apply for summary judgment when the stay...