Siemens Industry Software Pte Ltd v Lion Global Offshore Pte Ltd

• Jurisdiction: Singapore
• Judge: Chan Seng Onn J
• Judgment Date: 28 November 2014
• Neutral Citation: [2014] SGHC 251
• Court: High Court (Singapore)
• Docket Number: Suit No 785 of 2014 (Registrar’s Appeal No 331 of 2014)
• Year: 2014
• Published date: 02 December 2014
• Hearing Date: 20 October 2014,23 October 2014
• Plaintiff Counsel: Navin Joseph Lobo and Ang Kai Wen (ATMD Bird & Bird LLP)
• Defendant Counsel: Lim Hong Kan (Lim & Bangras)
• Subject Matter: Contract,Formation
• Citation: [2014] SGHC 251

Chan Seng Onn J: Introduction

This is an appeal by the defendant against the decision of the Assistant Registrar (“the AR”) entering summary judgment on a sum of $267,500 in favour of the plaintiff. I dismissed the defendant’s appeal. The defendant has since filed an appeal against my decision.

Background

The plaintiff is a company whose stated business is in the development of software and other programming activities and software consultancy. The defendant is a company whose stated business is in offshore rig vessel design, shipbuilding, ship repair, commissioning and marketing as well as marketing and trading in offshore vessels. Both companies were incorporated in Singapore.¹

At the material time, there was a copyright infringement dispute between the plaintiff and the defendant regarding the installation and use of eight allegedly infringing copies of the plaintiff’s software on the defendant’s computer’s system (“the Copyright Dispute”).²

On 27 June 2014, representatives of the plaintiff and the defendant met at the plaintiff’s office with a view to settle the Copyright Dispute (“the Meeting”).³ Two documents were signed at the Meeting, namely: the Settlement Agreement (“the SA”);⁴ and a document titled “Quotation 419833 Licensed Software Designation Agreement” (“the LSDA”).⁵

The SA is a short, two-page document with eight clauses. In effect, the SA is a full and final settlement of the Copyright Dispute on a no-fault basis, subject to certain conditions. Clause 1 of the SA states that the defendant agrees to buy six sets of the plaintiff’s software called FEMAP, pursuant to the LSDA. Clause 3 of the SA states that the settlement will only come into force and be valid when the defendant has made full payment for all monies owed under invoice” to the plaintiff. It is clear, therefore, that the SA is conditional on the payments owed under the LSDA.

The LSDA is three pages long. The first page sets out the software to be purchased, namely, the six software licenses, as well as the price, being $250,000 (plus taxes). The second page sets out additional terms and conditions, including the means by which the software will be delivered to the customer and the validity of the quotation. The last page is simply the page used for parties to sign. Under the title “Licensed Software Designation Agreement” can be found the words “Valid through: June 30, 2014”.

At the end of the Meeting, the defendant’s director, Mr Ng Khim Kiong (“Mr Ng”), signed the SA, while the defendant’s general manager, Mr Benjamin Oh (“Mr Oh”), signed the LSDA.⁶ The LSDA was countersigned by one of the plaintiff’s representatives.⁷ However, a copy of the SA signed by the plaintiff was never provided to the defendant.⁸

On 30 June 2014, the plaintiff transmitted to the defendant by email a “Proforma Invoice” dated 28 June 2014 (“the Invoice”) for the sum of S$267,500 being the purchase price of S$250,000 and goods and services tax amounting to S$17,500 (7% of S$250,000).⁹ The payment term was stated to be “immediate”. However, the email to which the Invoice was attached stated: “As per agreement and process, USD 100K or USD 150k shall be paid to Siemens within today, and the rest will be arranged in the coming 2 days”.¹⁰ Mr Saurabh Bose (“Mr Bose”), the director of License Compliance (Asia Pacific), Global Sales & Services of the plaintiff, clarified that the payments were actually for the same sums in Singapore dollars.¹¹

Around 2 July 2014, Mr Oh informed the plaintiff that the defendant was not willing to pay on the Invoice.¹² The plaintiff took the view that this amounted to a repudiatory breach of the LSDA.¹³

Notwithstanding the non-payment by the defendant, the plaintiff delivered six software licenses to the defendant by making the software available on a website and providing the necessary passwords and instructions to the defendant to download, activate and use the plaintiff’s software licenses by way of an email dated 15 July 2014.¹⁴ This delivery was in accordance with the LSDA, which states that the delivery of the products will occur when the plaintiff makes the software available to the customer by means of electronic download from a website specified by the plaintiff.¹⁵

The next day, the plaintiff issued a letter of demand through its solicitors notifying the defendant of the plaintiff’s election to perform notwithstanding the defendant’s refusal to pay. The plaintiff demanded payment of the sum of S$267,500 within seven days of the date of the letter.¹⁶

No payment was made by 24 July 2014, and the plaintiff commenced the present action on the same date.¹⁷ According to the Statement of Claim, the plaintiff’s claim is simply a claim in debt as: the defendant acted in breach of its obligations under the LSDA when it informed the plaintiff that it would not be making payment under the Invoice; notwithstanding the defendant’s breach of the LSDA, the plaintiff elected to perform and duly delivered the plaintiff’s software in accordance with the terms of the LSDA; and the defendant is, as a result of the circumstances raised in [12(a)] and [12(b)], indebted to the plaintiff for the sum of S$267,500, which has not been paid.

General principles on which summary judgment is granted

In the recent case of M2B World Asia Pacific Pte Ltd v Matsumura Akihiko [2014] SGHC 225 (“M2B World”), at [17] to [19], Prakash J gave a helpful overview of the legal principles governing an application for summary judgment. The relevant portion of the judgment reads as follows: 17 The legal principles governing an application for summary judgment are well known. To obtain judgment, the plaintiff first has to show that he has a prima facie case for summary judgment. If he fails to do that, his application ought to be dismissed. However, once the plaintiff shows that he has a prima facie case, the burden shifts to the defendant who, in order to obtain leave to defend, must establish that there is a fair or reasonable probability that he has a real or bona fide defence: see, for example, Ritzland Investment Pte Ltd v Grace Management & Consultancy Services Pte Ltd [2014] 2 SLR 1342 (“Ritzland”) at [43]–[47].

18 In Ritzland, it was clarified that it is the tactical burden and not the evidential or legal burden that shifts to the defendant.

19 The defendant need only show that there is a triable issue or question or that for some other reason there ought to be a trial: Singapore Civil Procedure, vol 1 (Sweet & Maxwell, 2013) at para 14/4/5 (“Singapore Civil Procedure”). A court would not grant leave to defend if all the defendant provides is a mere assertion, contained in an affidavit, of a given situation which forms the basis of his defence: Prosperous Credit Pte Ltd v Gen Hwa Franchise International Pte Ltd [1998] 1 SLR(R) 53 at [14]. The following statement from Bank Negara Malaysia v Mohd Ismail & Ors [1992] 1 MLJ 400 is also instructive: Under an O 14 application, the duty of a judge does not end as soon as a fact is asserted by one party, and denied or disputed by the other in an affidavit. Where such assertion, denial or dispute is equivocal, or lacking in precision or is inconsistent with undisputed contemporary documents or other statements by the same deponent, or is inherently improbable in itself, then the judge has a duty to reject such assertion or denial, thereby rendering the issue not triable. In our opinion, unless this principle is adhered to, a judge is in no position to exercise his discretion judicially in an O 14 application. Thus, apart from identifying the issues of fact or law, the court must go one step further and determine whether they are triable. This principle is sometimes expressed by the statement that a complete defence need not be shown. The defence set up need only show that there is a triable issue.

The alleged triable issues

It is clear, from even the brief rendition of the background facts, that the plaintiff has a prima facie case for summary judgment.

In its written submissions before the AR, the defendant had argued that there were six triable issues in the present case, which it argued were as follows:¹⁸ The First Alleged Triable Issue: Whether the plaintiff is precluded from proceeding with its claim against the defendant by simply pleading its claim based solely on the LSDA without pleading the SA when in fact the LSDA is an express term of the SA; and therefore any decision made in this action might have impact on the settlement under the SA. The Second Alleged Triable Issue: If the LSDA is a separate agreement from the SA, whether the LSDA is unenforceable for uncertainty since there are, inter alia, no agreed terms or any term for payment. The Third Alleged Triable Issue: The words “Valid through: June 30, 2014” in the LSDA are vague and uncertain. The triable issue is whether the date refers to the date on which the parties must sign the LSDA, the date the plaintiff must deliver the goods to the defendant, or the date the defendant must make payment to the plaintiff. The Fourth Alleged Triable Issue: Whether the Invoice with a unilaterally imposed term (ie, the requirement that payment be immediate), and whether the email dated 30 June 2014 requesting the defendant to pay US$100,000 or US$150,000 within the same day and the rest to be arranged within the following two days, constituted a variation of the terms of the LSDA, thereby rendering the LSDA invalid. The Fifth Alleged Triable Issue: Whether para 5(d) of the plaintiff’s Reply should be struck out or alternatively be disregarded for the purpose of the plaintiff’s application therein. Paragraph 5(d) of the Reply states:

In order to give business efficacy to the LSDA, it was an implied term of the LSDA that the sum of S$250,000 (and 7% GST thereon) would be paid upon the issuance of the Invoice. In the alternative, in order to give business efficacy of the LSDA,...