L & M Concrete Specialists v United Eng: Arbitration Clause Incorporation & Waiver Dispute
L & M Concrete Specialists Pte Ltd appealed to the High Court of Singapore against the dismissal of their application for a stay of United Eng Contractors Pte Ltd's counterclaim. The primary legal issue was whether an arbitration clause in L & M's standard form contract was incorporated into their contract with United Eng, and if so, whether L & M had waived their rights under that clause by commencing an action in court. Choo Han Teck JC dismissed the appeal, holding that the arbitration clause was not properly incorporated and that L & M had waived their right to arbitration.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Appeal dismissed.
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Appeal regarding stay of counterclaim. Court held arbitration clause not incorporated into contract and L & M waived rights by commencing court action.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| L & M Concrete Specialists Pte Ltd | Appellant, Plaintiff | Corporation | Appeal dismissed | Lost | S Bhaskaran |
| United Eng Contractors Pte Ltd | Respondent, Defendant | Corporation | Counterclaim not stayed | Won | Ramalingam Kasi |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Choo Han Teck | Judicial Commissioner | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| S Bhaskaran | J Koh & Co |
| Ramalingam Kasi | Raj Kumar & Rama |
4. Facts
- L & M were the main contractors and United Eng were the subcontractors for the Hilltop and Sinsov Projects.
- The Letter of Award (LOA) for the Sinsov Project was dated 23 September 1996.
- United Eng accepted the LOA with minor amendments and signed it.
- The LOA referred to the `Standard Conditions of Subcontract`, but this document was never given to United Eng.
- The arbitration clause relied upon by L & M was found in cl 17 of the `Standard Sub-Contract (Domestic) For Labour and Materials`.
- L & M commenced an action in court (OS 478/98) seeking delivery of documents pertaining to the Sinsov Project.
- United Eng is facing a winding up order.
5. Formal Citations
- L & M Concrete Specialists Pte Ltd v United Eng Contractors Pte Ltd, Suit 600131/2000, [2000] SGHC 166
6. Timeline
| Date | Event |
|---|---|
| Letter of Award (LOA) issued for the Sinsov Project. | |
| Letter of Award issued for the Hilltop Project. | |
| L & M took out an application by way of OS 478/98 seeking delivery of documents pertaining to the Sinsov Project. | |
| United Eng filed a claim against L & M (Suit 1523/98) for the unpaid balance sum in respect of the Hilltop Project. | |
| Judgment entered in favour of United Eng in Suit 1523/98. L & M's counterclaim was struck out. | |
| Chew’s affidavit filed. | |
| Appeal dismissed. |
7. Legal Issues
- Incorporation of Arbitration Clause
- Outcome: The court held that the arbitration clause in L & M's standard form contract had not been properly and adequately incorporated into the contract with United Eng.
- Category: Substantive
- Sub-Issues:
- Reference to standard terms
- Requirement of specific wording
- Related Cases:
- [1895] 2 QB 539
- [1965] P 223
- [1984] QB 599
- [1912] AC 1
- [1996] CLC 1747
- [1971] P 168
- 57 BLR 1
- [1978] 1 All ER 18
- [1971] 2 QB 163
- Waiver of Right to Arbitration
- Outcome: The court ruled that L & M had waived their right to arbitration by commencing an action in court (OS 478/98) seeking delivery of documents pertaining to the Sinsov Project.
- Category: Procedural
- Sub-Issues:
- Commencement of court action
- Taking steps in proceedings
8. Remedies Sought
- Stay of Proceedings
- Monetary damages
9. Cause of Actions
- Breach of Contract
10. Practice Areas
- Arbitration
- Commercial Litigation
- Construction Law
11. Industries
- Construction
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| United Eng Contractors Pte Ltd v L & M Concrete Specialists Pte Ltd | High Court | Yes | [2000] 2 SLR 196 | Singapore | Cited to show that the contract between parties made no reference to the arbitration clause which L & M were seeking to rely on. |
| Manchaster Trust v Furness | N/A | Yes | [1895] 2 QB 539 | England and Wales | Cited for the proposition that there must be incorporation of the arbitration clause specifically in the LOA, rather than the mere reference of the existence of another document. |
| The Merak | N/A | Yes | [1965] P 223 | England and Wales | Cited as an example of specific words to be incorporated, such as `including the arbitration clause`. |
| The Varenna ; Skips A/S Nordheim & Ors v Syrian Petroleum Co Ltd & Anor | Court of Appeal | Yes | [1984] QB 599 | England and Wales | Cited to support the argument that an arbitration clause being a collateral agreement cannot be incorporated by general words of inclusion. |
| TW Thomas v Portsea SS Co Ltd | N/A | Yes | [1912] AC 1 | England and Wales | Cited as one of the cases in a long line of admiralty cases. |
| Extrudakerb (Maltby Engineering) Ltd v White Mountain Quarries Ltd | High Court of Northern Ireland | Yes | [1996] CLC 1747 | Northern Ireland | Cited for the argument that the court must be fully satisfied that it was indeed the intention of the parties to incorporate the arbitration clause into the contract, and it would require very clear language to evince that intention. |
| The Annefield | N/A | Yes | [1971] P 168 | England and Wales | Cited for the principle that it is not necessary, in order to effect incorporation, that the incorporating clause should refer expressly to the arbitration clause. |
| Aughton Ltd v MF Kent Services | N/A | Yes | 57 BLR 1 | N/A | Cited in relation to the passage from The Annefield [1971] P 168 at p 173. |
| Smith & Anor v South Wales Switchgear Co Ltd | House of Lords | Yes | [1978] 1 All ER 18 | England and Wales | Cited for the argument that as United Eng have signed the LOA, they were deemed to have accepted the terms contained therein including the `Standard Conditions of Subcontract`. |
| Thornton v Shoe Lane Parking Ltd | N/A | Yes | [1971] 2 QB 163 | England and Wales | Cited for the principle that arbitration clauses must be expressly brought to the attention of the other contracting party. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Arbitration Act (Cap 10) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Arbitration clause
- Incorporation
- Waiver
- Letter of Award
- Standard Conditions of Subcontract
- Standard Sub-Contract (Domestic) For Labour and Materials
- Stay of proceedings
15.2 Keywords
- arbitration
- contract
- waiver
- construction
- singapore
16. Subjects
- Arbitration
- Contract Law
- Civil Procedure
17. Areas of Law
- Arbitration Law
- Contract Law
- Civil Procedure