Fire-Stop Marketing Services Pte Ltd v Mae Engineering Ltd

• Jurisdiction: Singapore
• Judge: Lai Kew Chai J
• Judgment Date: 31 May 2004
• Neutral Citation: [2004] SGHC 116
• Court: High Court (Singapore)
• Published date: 08 June 2004
• Year: 2004
• Plaintiff Counsel: John Chung (Kelvin Chia Partnership)
• Defendant Counsel: Karam S Parmar and Dawn Chew (Tan Kok Quan Partnership)
• Subject Matter: Building and Construction Law,Building and construction contracts,Construction of terms of contract for the installation of fire rated board claddings,Whether payment to be based on cladded or uncladded works.
• Citation: [2004] SGHC 116

31 May 2004 Judgment reserved.

Lai Kew Chai J:

1 The plaintiff is a supplier and installer of fire rated board claddings and the defendant was an air conditioning, mechanical and ventilation (“ACMV”) sub-contractor for the project known as The Esplanade, Theatres On The Bay, in Singapore.

2 According to the opening statement of the defendant:

The Sub-Contract price was for a lump sum of S$400,000.00 to clad 5000m² of ACMV ductwork. In respect of ACMV ductwork required to be fire cladded beyond the 5000m² (ie variations) the agreed rates were S$80 per m² and S$165 per m² for 2-hour fire-rated cladding and 4-hour fire-rated cladding respectively, of ACMV ductwork that is cladded.

3 A single issue was agreed on by the parties, namely, whether on the true and proper construction of the sub-contract document and having regard to all the documents, affidavits and evidence before the court, payment to the plaintiff should be based on the area of the cladded ACMV duct or the area of the uncladded ACMV duct. Accordingly, the basis of measurement is left to the court for decision.

4 The following important items relating to the work done and materials supplied and what is payable depending on the court’s findings, were agreed to between the parties. First, it was agreed that the value of the cladded ACMV, for materials supplied and work done, was $1,028,576.22 (excluding 3% goods and services tax (“GST”)). Second, the value of the cladded ACMV duct area was agreed at $529,610.00 (excluding 3% GST).

5 The financial consequences depending on the court’s findings were also agreed on. If the court decides that payment should be based on the area of the cladded ACMV duct, the total amount payable by the defendant to the plaintiff shall be $310,305.61 (excluding 3% GST). On the other hand, if the court rules that payment should be based on the area of the uncladded ACMV duct, the total amount payable by the plaintiff to the defendant shall be $168,664.29 (excluding 3% GST).

6 Parties had also agreed on the following matters. Without any admission of liability, the plaintiff agreed that the defendant is entitled to deduct $5,697.35 under the counterclaim. The defendant further agreed to withdraw its claims for indemnities without prejudice to its rights to raise them in future. The questions of interest and costs are left to the court for decision.

The facts

7 Pursuant to an agreement in writing made between the plaintiff and the defendant on 10 March 2000 (“the sub-contract”), the defendant employed the plaintiff “to supply deliver and install two-hour fire rated board cladding to 5000m² of ACMV ductwork with ‘Cape’ Monolux 40 Board System in the project for an agreed lump sum price of $400,000.00” on the terms and conditions set out in the sub-contract. The sub-contract provides for progress payments to be made to the plaintiff pursuant to the defendant’s certification. The sub-contract, however, is silent as to the mode of measurement of work done by the plaintiff.

Terms of the sub-contract

8 The first paragraph of the sub-contract written by the defendant on the defendant’s stationery[1] provides:

Further to your confirmation ref FS/06/6848/99 dated 30/6/99 agreed Lump Sum price of S$400,000.00 (SINDLRS Four Hundred Thousand Only) we hereby confirm the award for the provision of Supply, Delivery, Installation, Warranty & Endorsement of 2 Hours Fire Rated Board Cladding to 5000M2 of ACMV Ductwork with ‘Cape’ Monolux 40 Board System subject to the following terms and conditions. The price quoted is in Singapore dollars and not subject to any currency fluctuation or fluctuations of any sort or kind whatsoever.

9 Clause 1.1 of the sub-contract provides:

This Sub-Contract Agreement is for the provision of Supply, Delivery, Installation, Warranty & Endorsement of 2 Hours Fire Rated Board Cladding to 5000M2 of ACMV Ductwork with ‘Cape’ Monolux 40 Board System in accordance with the specifications and drawings.

The scope of works is as described in the specifications and drawings of the Main Contract relating to the System. The terms and conditions for the works shall as a minimum reflect all the requirements of the Main Contract in respect of the works to be carried out under this Sub-Contract.

If the contract is as stated remeasurable then final payment shall be subject to final measurements which will be based on the as built drawings.

10 It is common ground that the area of the ductwork or cladding was unknown at the time of the award of the sub-contract. The plaintiff was not given any drawings upon which to base its quotation. The defendant put up the figure of 5,000m² of ACMV duct. As the quantity was not known, the “5000m²” was merely an estimate of the work to be done.

11 In my view, what was agreed was the rate...