Yap Boon Keng Sonny v Pacific Prince International Pte Ltd and Another

• Jurisdiction: Singapore
• Judge: Judith Prakash J
• Judgment Date: 23 September 2008
• Neutral Citation: [2008] SGHC 161
• Docket Number: Suit No 49 of 2007
• Date: 23 September 2008
• Year: 2008
• Published date: 01 November 2008
• Plaintiff Counsel: Winston Quek (B T Tan & Company)
• Citation: [2008] SGHC 161
• Defendant Counsel: Brendon Choa (Acies Law Corporation)
• Court: High Court (Singapore)
• Subject Matter: Defective works,Defective construction not preventing use of rooms as bedrooms,Contract to construct house,Whether cost of rectifying defect/reinstatement or loss of amenity should be recovered,Damages,Homeowner refusing to let contractor enter to conduct rectification works,Whether contractor had to bear full cost of all defective works,Contract,Contract to construct house with bedrooms,Breach,Measure of damages,Completed bedrooms not of specified size

23rd September 2008 Judgment reserved.

Judith Prakash J:

Introduction

1 The plaintiff, Sonny Yap Boon Keng, and his wife, Angela Yeoh (“Mrs Yap”), are the owners of the land and premises known as No 25 Lorong K, Telok Kurau, Singapore (“the property”). The first defendant, Pacific Prince International Pte Ltd (“PPI”), is a company incorporated in Singapore which carries on business as a design and build contractor. At all material times, the shareholders and directors of PPI were the second defendant, William Lau Hui Lay and his wife, Midori Aw (“Ms Aw”). The second defendant, a qualified architect, was an active participant in the business of PPI as he provided, amongst other things, the architectural expertise that PPI required in order to provide the full design and build services that it offered to its clients. At all material times, the second defendant also carried on practice as an architect under the name and style of A. Alliance Architects.

2 In 2004, the plaintiff and his wife were looking for a house. In about June of that year, they were introduced to the second defendant by a mutual friend. Thereafter, the second defendant went with the plaintiff to view prospective purchases and commented on the suitability of the houses viewed in the light of the plaintiff’s needs. Eventually, the plaintiff and his wife decided to purchase the property which then contained a semi-detached single storey house. At the second defendant’s suggestion, the plaintiff decided to demolish the existing house on the property and to build a new house in its place.

3 The second defendant introduced PPI to the plaintiff as a company that would be able to undertake the task of designing and building the new house on the property (“the project”). Some time in mid August 2004, PPI carried out initial “Design and Contract Work” for a lump sum price of $5,000 in connection with the project. The plaintiff was pleased with the proposal and thereafter he and his wife had additional discussions and meetings with the second defendant regarding the project and their requirements for the house. A series of plans and specifications were produced by PPI.

4 On or about 7 December 2004, the plaintiff and PPI signed a memorandum of agreement (“MOA”) for the design and construction of a three-storey semi-detached house on the property. Ms Aw signed the MOA on behalf of PPI. The MOA provided, inter alia, that:

(a) the contract sum for the design and construction of the house up to completion would be $736,400;

(b) the works would commence on 15 December 2004;

(c) the works would be completed on 15 December 2005;

(d) an extension of the contract period of two weeks ie up to 30 December 2005 may be required due to the lack of a sufficient mobilisation period; and

(e) the REDAS Design & Build Conditions of Contract, First edition, August 2001 (“REDAS Conditions”), would be the basis of the construction contract.

5 PPI thereafter implemented the project and carried out the design and construction of the house. The temporary occupation permit (“TOP”) was granted on 12 January 2006 whilst the Certificate of Statutory Completion (“CSC”) was issued by the authorities on 10 July 2006. It should be noted that the actual construction work was carried out by SE Builders Pte Ltd (“SEB”) which was PPI’s main sub-contractor but, of course, as between the plaintiff and PPI, it was PPI that was the builder.

6 These proceedings insofar as they concern PPI relate to the construction of the house. The main complaints relate to delay in completion, defective works and under-sized bedrooms that did not meet the plaintiff’s requirements. Insofar as the second defendant is concerned, the claim is made in tort for misrepresentation and breach of duty.

The plaintiff’s claim

7 The plaintiff has quantified his claim against both defendants as follows:

(a) cost of rectification	$109,000
of the requisite size	$141,080
3 months at $4,800 per month based on rental of an; equivalent house in the vicinity	$14,400
still continuing at $4,800 per month	$48,000
(e) alternatively, damages to be assessed

8 As against PPI, the plaintiff invoked two causes of action. The first was for breach of the express terms of the MOA in that PPI failed to complete the construction of the house by 15 December 2005 as specified in the MOA.

9 The second cause of action against PPI was for breach of implied terms of the MOA to wit:

(a) that PPI would carry out the work in a good and workmanlike manner; and

(b) that the design would be reasonably fit for its intended purpose.

In the alternative, the plaintiff alleged that PPI was in breach of its duty of care to see that the work was done in a workmanlike and professional manner so that the house would be fit for habitation. The plaintiff averred that PPI was liable to him both in contract and in tort in respect of the defective works and design as well as for the failure to build the bedrooms to the sizes required by the plaintiff. I should state here that in respect of the claim against PPI, I will deal with this purely on a contractual basis as all the breaches that the plaintiff alleged can be categorised as breaches of contract. As there was an existing contractual relationship between the parties which was intended to govern the legal relations between them in connection with the project, it would be wrong to consider the plaintiff’s complaints on the basis of a breach of duty in tort. Whatever duties of care PPI owed the plaintiff, these would have arisen from the contract and no other theory of liability should be invoked.

10 As regards the second defendant, the plaintiff elaborated on the bases of his claim as follows:

(a) he asserted that the second defendant made fraudulent or negligent misrepresentations to him which he acted upon and thereby sustained damage;

(b) the second defendant breached his duty of care to the plaintiff in that he:

(i) acted in conflict of interest; and

(ii) failed to explain to the plaintiff the nature and risk of a design and build contract and failed to protect the interest and rights of the plaintiff when the second defendant knew that the plaintiff was completely reliant upon him for proper advice.

The defence and counterclaim

11 In addition to defending the claim, PPI put in a counterclaim for the sum of $57,958.54 which is made up as follows:

(a) original contract sum under MOA	$736,400.00
(b) plus total variation orders	$ 73,287.28
(c) adjusted contract sum	$809,687.28
(d) less payments made by plaintiff	$751,728.74
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It should be noted that, subject to any right of set-off which the plaintiff may have with regard to his main claim, the plaintiff does not dispute that there is at least a sum of $42,572.39 due from the plaintiff to PPI in respect of the counterclaim.

12 Insofar as the second defendant is concerned, he denied that he made any fraudulent or negligent misrepresentations to the plaintiff. He also denied that he owed the plaintiff any duty of care at all. Further, even if there had been a breach of duty on his part, the second defendant denied that the plaintiff had suffered any loss or damage as a result of the alleged breach of duty.

13 PPI’s stand was that it did carry out and complete the design, construction and maintenance of the house and remedy any defects therein in conformity with the MOA. The works under the MOA were practically completed on 11 January 2006 and by a letter and an e-mail dated 28 January 2006, PPI informed the plaintiff of this completion and that the property was ready to be handed over to him. Despite this handover notice, the plaintiff failed, refused or neglected to take possession of the property until 15 March 2006. Any delay in the actual handover of the property was self-induced.

14 PPI agreed that there was an implied term in the MOA that it would exercise reasonable skill and care in the performance of the works, that the works would be done in a workmanlike or a professional manner and that the design would be in accordance with “the Agreed Design and Specifications” of the MOA. PPI did not admit to all the defects asserted by the plaintiff. It also asserted that it had promptly attended to and rectified all defects notified to it by the plaintiff and his wife between 28 January 2006 and 23 May 2006. In addition, the plaintiff and his wife had during this period requested PPI to carry out certain additional works and PPI had done so in accordance with the requests.

15 PPI also asserted that even if there were outstanding defective works, the plaintiff had, in breach of the MOA, in particular Article 3(e), unreasonably refused to allow PPI and its workmen access to the property to carry out follow-up service in maintenance and repairs. This was despite repeated requests for such access made both orally and by way of letter. PPI asserted that it was not liable to the plaintiff for the alleged defects and faults since the plaintiff had prevented it from rectifying these items during the 12-month long defects maintenance period provided for in the MOA.

16 As far as the room sizes were concerned, PPI’s position was that the rooms were constructed in accordance with the MOA and approved building plans.

17 As regards the allegation of delayed completion, the basic assertion made by PPI was that the late completion was due to “acts of prevention” on the part of the plaintiff which prevented PPI from completing on time. Details of these acts of prevention were set out in the defence and related essentially to variation orders issued by the plaintiff and the delayed confirmation of the nominated sub-contractor for the interior decoration of the house.

Claim against PPI

18 As stated earlier, there are three major areas of claim:

(a) delay in completion of the works;

(b) defects in the house; and

(c) failure to carry out the plaintiff’s instructions in that four bedrooms were of a size...