Management Corporation Strata Title Plan No 2827 v GBI Realty Pte Ltd and another

• Jurisdiction: Singapore
• Judge: Woo Bih Li J
• Judgment Date: 23 April 2014
• Neutral Citation: [2014] SGHC 86
• Court: High Court (Singapore)
• Docket Number: Suit No 920 of 2009 (Registrar’s Appeal No 406 of 2013)
• Published date: 14 July 2014
• Year: 2014
• Hearing Date: 18 March 2014,13 January 2014
• Plaintiff Counsel: Haridas Vasantha Devi (Sim Law Practice LLC)
• Defendant Counsel: Tan Yee Siong and Priscilla Wee (Rodyk & Davidson LLP),Henry Heng and Gina Tan (Legal Solutions LLC) (on watching brief)
• Subject Matter: Civil Procedure,Limitation,Parties,Joinder
• Citation: [2014] SGHC 86

Woo Bih Li J: Introduction

This is an appeal from the decision of an Assistant Registrar (“the AR”). The AR allowed an application for the appellant’s statement of claim and action against the respondent to be struck out and dismissed respectively. After hearing arguments, I dismissed the appeal. I was in agreement with the AR that the appellant’s claim against the respondent was time-barred. I now state the reasons for my decision.

Background

The striking-out application arose out of Suit No 920 of 2009 (“the Suit”). The appellant, Management Corporation Strata Title Plan No 2827 (“the MCST”), is the plaintiff in the Suit. The MCST is the management corporation of an industrial development at 59 Ubi Avenue 1, Bizlink Centre, Singapore 408938 (“the Development”). The respondent, Boustead Projects Pte Ltd (“Boustead”), is the second defendant in the Suit. Boustead is the main contractor which was engaged to design and construct the Development. GBI Realty Pte Ltd (“GBI Realty”) is the first defendant in the Suit. GBI Realty was the developer of the Development. Boustead was engaged by GBI Realty to design and construct the Development.

The Development consists of a single 7-storey building with access driveways and other amenities that surround the main building. The access driveways and other amenities were defined as “the Peripheral Regions” by Boustead for easy reference. I will adopt that definition as well. In the Suit, the MCST sought damages for negligent construction of the Development. The MCST claimed that GBI Realty and Boustead negligently failed to take appropriate preventive measures to deal with the soft marine clay subsoil which the Development was purportedly built on. The MCST alleged that the negligence led to a continuous sinking of the ground at the Peripheral Regions. This caused damage to the access driveways and other amenities.

The MCST commenced the Suit by issuing a writ of summons against GBI Realty on 27 October 2009. The writ did not include Boustead as a defendant. The writ was only amended to include Boustead as a defendant close to four years later, on 17 July 2013. The amended writ was served on Boustead on 30 July 2013.

Boustead applied to strike out the MCST’s claim and to dismiss its action against Boustead under O 18 r 19 of the Rules of Court (Cap 322, R 5, 2006 Rev Ed) (“ROC”) on the basis that the MCST’s claim against it was time-barred. The AR allowed the application. The MCST appealed. The sole question before me was whether the MCST’s claim against Boustead was time-barred.

The issues

The limitation periods for claims are stipulated by the Limitation Act (Cap 163, 1996 Rev Ed) (“the Act”). There are two dates relevant to the application of these limitation periods. The first is the date the limitation period commences. The second is the date the action is brought. A claim will be time-barred if the time between the date of commencement of the limitation period and the date the action is brought exceeds the limitation period stipulated by the Act.

I will first deal with the date the action was brought against Boustead. It was not disputed that the action was brought against Boustead when it was joined to the proceedings as a party. According to Ketteman and others v Hansel Properties Ltd and others [1987] 1 AC 189 (“Ketteman”) (at 200G and 218F), the date a person is joined to the proceedings as a party is the date the writ, which has been amended to include that person as a defendant, is served on that person. The amended writ was served on Boustead on 30 July 2013. Accordingly, Boustead became a party to the proceedings on that date.

I pause to make an observation on Ketteman. In Ketteman, the House of Lords overruled a previous decision of the English Court of Appeal in Seabridge and others v H Cox & Sons (Plant Hire) Ltd and another [1968] 2 QB 46 (“Seabridge”). The English Court of Appeal in Seabridge held that the date a person is joined to the proceedings is the filing date (and not the date of service) of the writ which has been amended to include that person as a defendant. The House of Lords in Ketteman overruled Seabridge because the decision in Seabridge was inconsistent with the plain wording of the then Rules of the Supreme Court (Revision) 1965 (SI 1965 No 1776) (UK) (“the UK Rules”). In particular, O 15 r 6 of the UK Rules stated that where “a person is to be added as a party ... that person shall not become a party until ... the writ has been amended in relation to him ... and ... has been served on him”.

Under the ROC, Order 15 r 6 is substantially similar to O 15 r 6 of the UK Rules. I agree that the terms are clear and that a person only becomes a party to the proceedings when the writ, which has been amended to include that person as a defendant, is served on him.

In my view, however, there are good reasons why the person to be joined should be deemed to have become a party to the proceedings at the date the amended writ is filed (this was the holding in Seabridge). In cases involving only a single defendant, the limitation period stops running when the writ is issued. The date of service is irrelevant. When a person is subsequently added as a party to the writ, it would be logical to think that the date of service should similarly be irrelevant as to when the limitation period stops running against that person. Also, it is not clear to me why a plaintiff who joins a person as a second defendant to existing proceedings should be in a worse position than a plaintiff who opts to issue a second writ against that person and applies to consolidate proceedings later. In the first scenario, the limitation period stops running only when the amended writ is served on the second defendant under the ROC whereas in the second scenario, the limitation period stops running when the second writ is issued. Unless there are good reasons to the contrary, the ROC should be amended to reflect the decision in Seabridge.

Now that I have dealt with the date the action was brought against Boustead, I turn to the date of commencement of the limitation period. This was the substance of the dispute between the parties at the appeal. There were three issues I had to address: the first was whether the action against Boustead was brought within six years of the accrual of the MCST’s cause of action against Boustead under s 6(1)(a) of the Act; the second was whether the action against Boustead was brought within three years from the date when the MCST had knowledge of its right of action against Boustead in respect of the damage in question under s 24A(3)(b) of the Act; and the third was whether the commencement of either limitation period above was postponed under s 29(1)(b) of the Act due to Boustead’s alleged fraudulent concealment of the MCST’s right of action.

I will give the reasons for my decision in respect of each of these issues after providing a brief sequence of events.

Sequence of events

On 1 March 2000, GBI Realty engaged Boustead to design and construct the Development.¹ On 31 March 2003, a Temporary Occupation Permit (“TOP”) was issued in respect of the Development.² The subsidiary proprietors likely took possession of the Development soon after the TOP was issued.³ On 10 November 2003, the MCST was constituted. On 8 January 2004, a Certificate of Statutory Completion was issued in respect of the Development.⁴

The MCST made a number of complaints about defects in the Development to Boustead between January 2004 and January 2005. On 30 March 2004, the MCST issued a letter of demand to Boustead in respect of defects at the Development. This letter of demand mentioned damage to the Peripheral Regions. It referred to a “[d]riveway sunkened-required [sic] resurfacing”.⁵ On 20 May 2004, the MCST complained about leakage from underground pipes in the Peripheral Regions.

Boustead carried out rectification works on the Development between April and August 2004 in response to the MCST’s various complaints. Nonetheless, the complaints from the MCST persisted. On 6 September 2004, Boustead sent a letter to the MCST stating that “the Defects Liability Period ... has already expired”, and that “[Boustead] cannot be held responsible for the defects”.⁶ Boustead nonetheless offered to conduct a subsequent site inspection out of goodwill.

In 2007, the MCST engaged CC Building Surveyor Pte Ltd (“CC”) to produce a report on the problem of soil settlement and related damage to the Development. The report titled “Inspection Report on Building Damage at Bizlink Centre” was dated 20 July 2007 (“the CC Report”). It was produced by Paul Crispin Casimir-Mrowzynski (“Mr Casimir”), a chartered building surveyor with CC, pursuant to a site inspection on 29 May 2007. The CC Report concluded that there was “severe settlement around the building”. Further, the settlement resulted from the soil not being “compacted adequately at the construction stage” and due to “insufficient support to the driveway and related structures”.⁷

On 21 July 2008, the MCST wrote to Boustead complaining of the “perennial sinking driveway problem”.⁸ The CC Report was appended to the letter. Boustead responded on 25 September 2008 stating that the sinking of the driveway was not due to inadequate compaction of the marine clay. Boustead’s response further stated that they were “no longer liable for any report of defects ... presented ... after such a long time”.⁹

On 8 September 2009, the MCST, through its solicitors, Sim Law Practice LLC (“Sim Law Practice”), wrote to GBI Realty (and not Boustead) requesting that the sinking driveway be rectified and threatening legal proceedings.

Legal proceedings were subsequently commenced with the issuance of a writ against one defendant only, ie, GBI Realty on 27 October 2009. Boustead was served with an amended writ and became a party to the proceedings on 30 July 2013.

Whether the action against...