Ho See Jui (trading as Xuanhua Art Gallery) v Liquid Advertising Pte Ltd and another

• Jurisdiction: Singapore
• Judge: Lai Siu Chiu J
• Judgment Date: 29 April 2011
• Neutral Citation: [2011] SGHC 108
• Court: High Court (Singapore)
• Docket Number: Suit No 959 of 2009/P
• Published date: 10 May 2011
• Year: 2011
• Hearing Date: 19 January 2011,17 January 2011,18 January 2011,21 January 2011
• Plaintiff Counsel: Kelvin Poon Kin Mun and Melissa Kue (Rajah & Tann LLP)
• Defendant Counsel: Audrey Chiang Ju Hua and Lim Yew Kuan Calvin (Rodyk & Davidson LLP),A Shahiran Anis bin Mohamed Ibrahim (Asia Law Corporation)
• Subject Matter: Tort,Commercial Transactions,Contract
• Citation: [2011] SGHC 108

Lai Siu Chiu J: Introduction

This action arose out of the rupture of a water inlet hose which carried water to a water dispensing unit (“the WDU”) installed at the office of Liquid Advertising Pte Ltd (“the first defendant”). The WDU was installed and maintained by Goh Sin Huat Electrical Pte Ltd (“the second defendant”). The water which leaked from the ruptured water inlet hose seeped into an art gallery called Xuanhua Art Gallery (“the Art Gallery”) located below the first defendant’s office. The art gallery was owned and operated by Ho See Jui (“the plaintiff”). The water seepage resulted in damage to the plaintiff’s paintings which were painted on rice paper.

Background The parties

The plaintiff is in the business of exhibiting and selling contemporary Chinese ink paintings which are traditionally painted on rice paper. He is the tenant of the ground floor of a two-storey shophouse located at 70 Bussorah Street, Singapore 199483. He displayed his paintings at the Art Gallery and also stored some paintings in a cabinet located at the back of the Art Gallery.

The first defendant was at all material times the tenant of 70A Bussorah Street (“the Second Floor Unit”) which is located directly above the Art Gallery.

The second defendant is the sole local distributor of the “Frigeria” brand of WDUs. Additionally, the second defendant also repairs and maintains the same brand of water dispensing units. The second defendant sold the first defendant the “Frigeria” brand WDU that is the subject of this claim, on or about 2 April 2001.

The installation of the WDU at the Second Floor Unit

The second defendant had initially installed (in April 2001) the WDU at the first defendant’s previous office located at 770A North Bridge Road, Singapore 198738. When the first defendant moved to the Second Floor Unit, it entered into an agreement with the second defendant for the latter to reinstall the WDU at the Second Floor Unit (“the Reinstallation Agreement”). A quotation issued for the installation (“the Quotation”) contained the following clause (“the Quotation Warning”):

** PLS [sic] NOTE: THE PLACE WHERE THE WATER DISPENSER IS INSTALLED SHOULD HAVE A FLOOR TRAP, SO THAT WHEN THERE IS A LEAK IT WILL NOT FLOOD THE AREA. WE WILL NOT BE HELD RESPONSIBLE FOR ANY DAMAGES [sic] RESULTING FROM THE LEAKING [sic] OR FLOODING FROM THE FILER [sic] OR WATER DISPENSER.

The second defendant reinstalled the WDU at the Second Floor Unit on 2 September 2004. (Hereinafter, the area where the WDU was installed will be referred to as the “WDU Area”). It was not disputed that the WDU Area had timber flooring which could allow water to pass through its cracks.

The maintenance of the WDU

The first defendant entered into service and maintenance contracts with the second defendant in August 2001 (“the First Maintenance Contract”), on 11 December 2003 (“the Second Maintenance Contract”) and on 22 June 2005 (“the Third Maintenance Contract”) (collectively, “the Maintenance Contracts”). The second defendant’s service director, however, asserted during cross-examination that the parties only had one maintenance contract which was renewed.

The Third Maintenance Contract (which duration was from 22 June 2005 to 21 June 2007) stated that the WDU was to be serviced a total of eight times.

The Second Maintenance Contract and the Third Maintenance Contract though not the First Maintenance Contract, contained the following clause (“the Disclaimer”):

DEAR CUSTOMER,

PLEASE BE INFORMED THAT THE INSTALLATION OF THE WATER COOLER AND/OR WATER DISPENSER SHOULD BE AT A WET PANTRY AREA. GOH SIN HUAT ELECTRICAL PTE LTD WILL NOT BE HELD RESPONSIBLE FOR ANY DAMAGES [sic] RESULTING FROM FLOODING OR LEAKING FROM THE WATER FILTER AND/OR WATER COOLER AND/OR WATER DISPENSER OR ANY DAMAGES [sic] FROM THE INSTALLATION OR REPAIR OR FAULT OF THE WATER COOLER AND/OR WATER DISPENSER.

The Disclaimer was also inserted in the second defendant’s service orders which were issued for services carried out under the Maintenance Contracts, and in the service order issued for the reinstallation of the WDU at the Second Floor Unit.

The rupturing of the Water Inlet Hose

It was common ground that the water inlet hose (“the Water Inlet Hose”) carrying water to the WDU ruptured sometime in the evening of 24 September 2008 and the early morning of 25 September 2008. The water that leaked from the Water Inlet Hose seeped through the flooring of the Second Floor Unit into the Art Gallery. The plaintiff alleged that the water that seeped into the Art Gallery damaged his paintings and the cabinet storing his paintings – this damage formed the basis of his action against the defendants.

The pleadings

The plaintiff raised three causes of action against the first defendant in his claim for general and special damages. First, that the first defendant was negligent in: (a) installing the WDU at the WDU Area; (b) failing to relocate the WDU to a wet pantry area or a place with drainage; and (c) failing to ensure that the WDU and/or the Water Inlet Hose were properly maintained. Second, that the first defendant created a nuisance by installing the WDU in an inappropriate location. Third, that the installation of the WDU at the WDU Area was a non-natural or special use that increased the danger to the plaintiff and/or the Art Gallery; the plaintiff’s claim in this regard was based on the rule in John Rylands and Jehu Horrocks v Thomas Fletcher (1868) LR 3 HL 330 (“Rylands v Fletcher”).

As against the second defendant, the plaintiff pleaded two causes of action. First, that the second defendant was negligent for broadly the same reasons raised vis-à-vis the first defendant. In addition, the plaintiff alleged that the second defendant was negligent in: (a) installing the Water Inlet Hose which was inherently unsuitable for the carriage of potable water and/or for use with the WDU and (b) providing and/or installing the Water Inlet Hose without ascertaining whether the Water Inlet Hose was suitable for use with the WDU. Second, as with his claim against the first defendant, the plaintiff alleged that the second defendant created a nuisance by installing the WDU at an inappropriate location.

The first defendant’s defence was as follows: The first defendant did not know and could not have been expected to know that: (i) it was dangerous to the Art Gallery to install and ordinarily use the WDU; and (ii) the installation of the WDU at the WDU Area was inappropriate. The first defendant provided extensive particulars why it could not have known these two facts – it explained that it had appointed the second defendant, a competent independent contractor, to install and maintain the WDU and its piping and it also took reasonable steps to ensure that the WDU would be properly installed and maintained. (It appeared from the first defendant’s opening statement and closing submissions that its averments on its knowledge related to the plaintiff’s claim in nuisance). The first defendant asserted that an employer would only be responsible for the nuisance created by an independent contractor if it could reasonably foresee that the work it instructed the independent contractor to do was likely to result in a nuisance. The first defendant did not admit that it owed the plaintiff a duty of care. In the alternative, the first defendant claimed that it discharged its duty of care by appointing a competent independent contractor. As for the plaintiff’s claim based on the rule in Rylands v Fletcher, the first defendant averred that the use, installation and maintenance of the WDU at the WDU Area were natural uses of the Second Floor Unit. The first defendant also averred that any non-natural use was due to an independent act of a third party.

The second defendant denied that it owed a duty of care to the plaintiff or that it breached that duty for the following reasons: The second defendant did not know that the carpeted flooring at the WDU Area was made of timber and that the WDU Area was located directly above the plaintiff’s cabinet containing some of the plaintiff’s paintings. The second defendant was not responsible for the location where the WDU was installed. The second defendant did not install the Water Inlet Hose. The second defendant also averred that the Water Inlet Hose appeared to be deliberately cut.

The second defendant denied the plaintiff’s nuisance claim for broadly the same reasons.

The first defendant served a notice of contribution or indemnity against the second defendant for the plaintiff‘s claim. The first defendant claimed that it was entitled to an indemnity or contribution because the second defendant had breached various implied terms of the Reinstallation Agreement and the Maintenance Contracts in two respects. First, it provided the Water Inlet Hose which was of an unsatisfactory quality and/or was not reasonably fit for its intended purpose. Second, the second defendant did not perform its obligations under the Reinstallation Agreement and the Maintenance Contracts with reasonable care and skill, or at all.

The main points that the second defendant raised in response to the first defendant’s claim for an indemnity or contribution were as follows. First, the Maintenance Contracts expired before 24 September 2008. Second, under the terms of the Third Maintenance Agreement, the second defendant did not take responsibility for the location of the WDU. Further, the second defendant’s duties only concerned the WDU itself and not the Water Inlet Hose. Third, the terms that the first defendant claimed were implied into the Reinstallation Agreement and the Third Maintenance Agreement were not so implied because the Water Inlet Hose was not installed by the second defendant. Fourth, in the alternative, the second defendant was entitled to rely on the Quotation Warning and the Disclaimer.

The trial before this...