Koh Guan Keng and Another v Fortune Development Pte Ltd
| Judge | Thian Yee Sze |
| Judgment Date | 12 January 2009 |
| Neutral Citation | [2009] SGDC 11 |
| Citation | [2009] SGDC 11 |
| Published date | 28 May 2009 |
| Court | District Court (Singapore) |
| Plaintiff Counsel | Patrick Ong Kok Seng (David Ong & Co) |
| Defendant Counsel | Raymond Lye and Cheryl Yeo (Pacific Law Corporation) |
| 12 January 2009 |
Judgment reserved. |
District Judge Thian Yee Sze:
1 This was a claim by the purchasers (“the plaintiffs”) against the developer vendors (“the defendants”) for alleged defects in an apartment, No 28 Shanghai Road, #19-02, Singapore 248196 (“the apartment), which the former purchased from the latter. The defendants counterclaimed for the sum of $39,450.00, being 5% of the purchase price which was due to them under the sale and purchase agreement (“the agreement”) dated 31 January 2003. The plaintiffs denied that the defendants were entitled to that sum by virtue of the costs incurred by the plaintiffs to rectify the alleged defects, and for which they said they were entitled to set off against the said outstanding sum due to the defendants.
2 In order to determine the merits of the respective parties’ cases in relation to the above disputes, the starting point in the court’s inquiry would be the contractual provisions in the agreement itself. It would be necessary to set out the pertinent clauses in this regard.
3 The defendants did not deny that the apartment had to be built in a “good and workmanlike manner according to the Specifications and the plans approved by the Building Authority and other relevant authorities” in accordance to Clause 9.1 of the agreement. The Notice of Vacant Possession in respect of the apartment was given by the defendants’ solicitors, Wong Partnership, in their letter dated 12 May 2005 to the plaintiffs’ solicitors, Tan Andrea Seah & Partners[note: 1]. The plaintiffs took actual possession of the apartment on or around 30 May 2005. Clause 17 of the agreement stipulated the defendants’ obligations in respect of defects during the defects liability period. As the bone of contention between the parties rested on the fulfillment of the defendants’ obligations under Clause 17, the text of the pertinent sections of that clause would be highlighted:
17. DEFECTS LIABILITY PERIOD
17.1 The Vendor must make good at his own cost and expense any defect in the Unit, the Housing Project or the common property which becomes apparent within the defects liability period, namely the period of 12 months from the date the Purchaser receives the Notice of Vacant Possession in respect of the Unit.
17.2 The Vendor must make good any such defect within one month of his receiving a notice from the Purchaser requiring the Vendor to make good such defect, failing which the Purchaser may do the following:
(a) notify the Vendor of his intention to cause rectification works to be done and the estimated cost of carrying out those works; and
(b) give the Vendor an opportunity to carry out the proposed rectification works within 14 days after the date of the notice in paragraph (a), failing which he may proceed to rectify the defect by his own employees or workmen.
17.3 If the Vendor, after having been duly notified under clause 17.2, fails to carry out the rectification works to make good the defect within the specified time, the Purchaser has the right to cause the rectification works to be carried out and to recover from the Vendor the cost of those rectification works. The Purchaser may deduct the cost of those rectification works from any sum held by the Singapore Academy of Law as stakeholder for the Vendor.
(at BD-12; emphasis added)
4 The term, “defect” was defined in Clause 1.1.1 as:
… any fault in the Unit, the Housing Project or the common property which is due either to defective workmanship or materials or to the Unit, the Housing Project or the common property, as the case may be, not having been constructed according to the Specifications;
The issue of the scope of the defendants’ pleaded case
5 Before the court delved into the factual disputes between the parties, I had to address a more fundamental issue – that of the variance between the defendants’ pleaded case and the areas of disputes they aired during the trial in relation to the notice or notices of defects submitted by the plaintiffs to the defendants. A comparison between the pleadings and the course taken at the trial would make this apparent.
6 On this aspect, in their statement of claim, the plaintiffs averred in paragraph 8 that:
8. Further, the Defendants are also in breach of their obligations contained in Clauses 17.1 and 17.2 of the Agreement in that the Defendants had willfully and lawfully failed to carry out the necessary rectification works in the Unit within the contractual time-frames after receiving the requisite notice of defects from the Plaintiffs.
PARTICULARS
(a) On the 27th day of June 2005, the Plaintiffs submitted a Notice of Defects (“1st Notice of Defects”) to the Defendants and/or their representatives, servants or agents. Pursuant to Clause 17.2 of the Agreement, the Defendants had one (1) month to make good the defects therein; ie by the 26th day of July 2005.
…
(d) By way of a letter dated 2 August 2005 from the Plaintiffs to the Defendants, the Plaintiffs highlighted the major defects in the Unit and also the estimated costs of rectification works for major defects only. At the same time, the Plaintiffs also gave notice to the Defendants under Clause 17.2(a) & (b) of the Agreement to rectify all defects in the 1st Notice of Defects within 14 days, failing which the Plaintiffs would be entitled to carry out the rectification works on his own.
(e) By way of a letter dated 23 August 2005 from the Plaintiffs to the Defendants, the Plaintiffs wrote to complain that no rectification works had yet been carried out by the Defendants to-date.
(f) By way of a letter dated 26 August 2005 from the Plaintiffs to the Defendants, the Plaintiffs enclosed a signed quotation from the Plaintiffs’ contractors for the costs of rectification works to rectify all defects as stated in the 1st Notice of Defects.
(at BP-7 and 8; emphasis added)
7 It was pertinent to note that in their Defence and Counterclaim, the defendants admitted to all the facts set out in the above paragraphs of the statement of claim[note: 2].
8 At the trial, however, the defendants raised the issue of the number of notices of defects, as well as the time period within which the defects were to be rectified, for the first time. Right up to the first day of trial, the defendants did not dispute that the defects were to be rectified within a month of the plaintiffs’ service of the notice of defects (“the 1st Notice). Neither did they allege that the plaintiffs’ letter of 2 August 2005 was in effect a new notice pursuant to Clause 17.2. As a matter of fact, in the affidavit of evidence-in-chief filed by the defendants’ quantity surveyor, Ng Wan Lan (“Ng”), it was implicitly admitted that the defects were to be rectified “within 30 day of 27 June 2005”:
11. The Main Contractors were not able to rectify all the defects in the Defect List within 30 days of 27 June 2005 because their previous supervisor Frank Lim worked for them for only a few months and left their employment on or about July 2005.
12. However the main contractors did everything that was reasonably possible to rectify the defects soon thereafter. In fact the Main Contractors’ representative Tay Tian Seng attended at an inspection on 21 July 2005 and stated at the last page of the Notice that he would rectify the defects alleged in the List. The rectifications done by the Main contractors are set out in Tay’s Affidavit. …
(at NWL-4 and 5; emphasis added)
9 During the cross-examination of the 1st plaintiff, defendants’ counsel questioned him on the two new points which had previously not been raised. In respect of the number of notices of defects raised by the plaintiffs, the defendants’ contention was that there were altogether three such notices (the second being in the form of the plaintiffs’ letter of 2 August 2005 and the third being what the plaintiffs pleaded in their reply was their 2nd notice of defects dated 26 September 2005[note: 3]. The defendants contended that the defects set out in the letter of 2 August 2005 were new defects which were not raised in the 1st Notice. An extract of the Notes of Evidence would reveal this:
Ct: The document entitled “comparison between 1st defects list and 2nd defects list and 3rd defects list” admitted and marked BD-305 to 309 in running order.
Q: Just to make this clear to you what this list is. First column on the left is the five-page defects list. The column in the middle is what you have stated in the letter of 2 Aug 05, the four major areas of concern. The 3rd column is what you say is your second defects list dated 26 Sep 05. In this list we have done, we the Defendants have called it according to (reads the row across from “s/no”). We will explain to you why. If you just compare the first and second columns. If you compare the two, it is the Defendant’s case that what you have stated in your 2 Aug 05 letter are actually new complaints of defects not stated in your 27 Jun 05 five-page defects list. Just look at the “Living Room”. In the original five-page defects list, comparing with the list of 2 Aug 05, if you look at first item on the list of 2 Aug 05, “marble had scratches”, is it stated anywhere in the first column that the marble has scratches?
A: No.
(at NE-68C to 69A; emphasis added)
…
Q: Put: almost all the defects stated in your letter of 2 Aug 05 is not stated in your defects list of 27 Jun 05.
A: Disagree.
Q: Put: because the defects stated in the 2 Aug 05 letter is almost completely different from that stated in the defects list dated 27 Jun 05 that a fresh 30-day notice under Clause 17.2 would have been required in the event that there is no dispute whether these new defects are indeed defects.
A: Disagree.
(at NE-74B to D; emphasis added)
10 The defence also revealed during the said cross-examination their argument that the 30-day time period should be “suspended” if there was a dispute between parties over whether an item was indeed a defect or otherwise:
Q: Clause 17.2 talks about...
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