New Civilbuild v Guobena: Res Judicata, Performance Bonds & Building Sub-Contracts
In a dispute before the High Court of Singapore on 29 February 2000, New Civilbuild Pte Ltd sued Guobena Sdn Bhd for damages, retention moneys, and outstanding progress claims related to a building sub-contract for the Tanglin Regency project. Guobena counterclaimed for expenses and liquidated damages. Tai Ping Insurance Co Ltd was also involved due to a performance bond. The court partly allowed New Civilbuild's claim and Guobena's counterclaim for expenses, dismissing Guobena's claim for liquidated damages. The court also ruled that Guobena's call on the performance bond was neither fraudulent nor unconscionable.
1. Case Overview
1.1 Court
High Court1.2 Outcome
New Civilbuild's claim against Guobena is partly allowed, Guobena's counterclaim against New Civilbuild is allowed in respect of expenses incurred on behalf of New Civilbuild, and Guobena's counterclaim for liquidated damages is dismissed.
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Singapore High Court judgment on res judicata, performance bonds, and building sub-contracts in a dispute between New Civilbuild and Guobena.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Guobena Sdn Bhd | Defendant | Corporation | Counterclaim Partly Allowed | Partial | |
| New Civilbuild Pte Ltd | Plaintiff | Corporation | Claim Partly Allowed | Partial | |
| The Tai Ping Insurance Co Ltd | Defendant | Corporation | Judgment in Favour | Won |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Lai Siu Chiu | Judge | Yes |
4. Counsels
4. Facts
- Guobena was the main contractor for a condominium project called Tanglin Regency.
- New Civilbuild was subcontracted by Guobena to carry out part of the works.
- The sub-contract was valued at $16,413,047.88, excluding Goods and Services Tax.
- The sub-contract was stated to be in the standard form of the Singapore Institute of Architects.
- Tai Ping issued a performance bond for $1,642,045 in favor of Guobena at the request of New Civilbuild.
- New Civilbuild commenced construction on or about 21 September 1995.
- Guobena called on the performance bond due to delays in the completion of the works.
- New Civilbuild claimed the delay was due to Guobena's default.
- Guobena denied New Civilbuild's claims and counterclaimed for expenses and liquidated damages.
- New Civilbuild sought a declaration that Guobena's call on the bond was fraudulent and/or unconscionable.
5. Formal Citations
- New Civilbuild Pte Ltd v Guobena Sdn Bhd and Another, Suit 46/1998, [2000] SGHC 30
6. Timeline
| Date | Event |
|---|---|
| Main contract awarded to Guobena | |
| Sub-contract dated | |
| New Civilbuild commenced construction | |
| Letter of Award dated | |
| Original scheduled completion date | |
| Guobena issued letter of demand to Tai Ping | |
| Guobena's solicitors issued a letter of demand to Tai Ping | |
| Injunction discharged by Judicial Commissioner Lee Seiu Kin | |
| Judgment Date |
7. Legal Issues
- Res Judicata
- Outcome: The court held that the doctrine of issue estoppel and/or res judicata did not apply in this case.
- Category: Procedural
- Fraudulent and/or Unconscionable Call on Performance Bond
- Outcome: The court found that Guobena had not been fraudulent or unconscionable in calling on the bond.
- Category: Substantive
- Entitlement to Liquidated Damages
- Outcome: The court dismissed Guobena's counterclaim for liquidated damages because no delay certificate was issued.
- Category: Substantive
- Liability for Delay in Completion of Project
- Outcome: The court found that a large portion of the delays was due to default and omissions on the part of New Civilbuild.
- Category: Substantive
8. Remedies Sought
- Monetary Damages
- Declaratory Order
- Repayment of Sums Received Under Bond
9. Cause of Actions
- Breach of Contract
- Claim for Expenses
- Claim for Liquidated Damages
- Declaratory Relief
10. Practice Areas
- Construction Law
- Commercial Litigation
11. Industries
- Construction
- Insurance
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Fidelitas Shipping Co Ltd v V/O Exportchleb | Queen's Bench | Yes | [1966] 1 QB 630 | England and Wales | Cited for the explanation of issue estoppel (res judicata in the wide sense). |
| Florence Bailes v Dr Ng Jit Leong | Unknown | Yes | [1983] 2 MLJ 175 | Malaysia | Cited for the principle that the defence of issue estoppel and/or res judicata must be pleaded. |
| American Cyanamid Co v Ethicon Ltd | House of Lords | Yes | [1975] AC 396 | United Kingdom | Cited regarding the limitation of the use of affidavits in interlocutory hearings. |
| Cheng Hang Guan & Ors v Perumahan Farlim (Penang) Sdn Bhd & Ors | High Court | Yes | [1988] 3 MLJ 90 | Malaysia | Cited for the principle that an order refusing the extension of an interlocutory injunction lacks the essential element of finality. |
| Bocotra Construction Pte Ltd & Ors v A-G | Court of Appeal | Yes | [1995] 2 SLR 523 | Singapore | Cited for the test of whether an order or judgment is final or interlocutory in nature. |
| Bozson v Altrincham Urban District Council | Kings Bench | Yes | [1903] 1 KB 547 | England and Wales | Cited for the principle that a final order must be one which finally disposes of the rights of the parties. |
| Rank Xerox (Singapore) Pte Ltd v Ultra Marketing Pte Ltd | Court of Appeal | Yes | [1992] 1 SLR 73 | Singapore | Cited for the definition of 'the rights of the parties' as referring to the substantive rights in dispute in the particular action. |
| Tropicon Contractors Pte Ltd v Lojan Properties Pte Ltd | High Court | Yes | [1989] SLR 610 | Singapore | Cited for the principle that if the sub-contract contemplates a delay certificate and none is issued by the claimant, then no liquidated damages can be claimed. |
| Banner Investments Pte Ltd v Hoe Seng Metal Fabrication & Engineers (S) Pte Ltd | High Court | Yes | [1997] 1 SLR 461 | Singapore | Cited for the principle that the question whether a clause is a penalty or a claim for liquidated damages is one of both law and fact and must be pleaded if the party relying on the point wishes to raise it at trial. |
| Salijah bte Ab Latef v Mohd Irwan Abdullah | High Court | Yes | [1996] 1 SLR 63 | Singapore | Cited for the law governing the granting of declaratory relief by the court. |
| Salijah bte Ab Latef v Mohd Irwan Abdullah | Court of Appeal | Yes | [1996] 2 SLR 201 | Singapore | Cited for the law governing the granting of declaratory relief by the court. |
| Sum Kum v Devaki Nair & Anor | Unknown | Yes | [1964] MLJ 74 | Malaysia | Cited for the principle that in an action for damages, the plaintiff must prove his damages. |
| Bonham-Carter v Hyde Park Hotel Ltd | Unknown | Yes | [1948] 64 TLR 177 | Unknown | Cited for the principle that in an action for damages, the plaintiff must prove his damages. |
| GHL Pte Ltd v Unitrack Building Construction Pte Ltd & Anor | Court of Appeal | Yes | [1999] 4 SLR 604 | Singapore | Cited for the principle that there exists a separate ground of `unconscionability` (apart from fraud) for restraining a beneficiary of a performance bond from enforcing it. |
| Bocotra Construction Pte Ltd v A-G (No 2) | Court of Appeal | Yes | [1995] 2 SLR 733 | Singapore | Cited for the principle that there exists a separate ground of `unconscionability` (apart from fraud) for restraining a beneficiary of a performance bond from enforcing it. |
13. Applicable Rules
| Rule Name |
|---|
| Rules of Court |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Supreme Court Judicature Act (Cap 322) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Performance Bond
- Sub-contract
- Liquidated Damages
- Res Judicata
- Issue Estoppel
- Delay Certificate
- Variation Works
- Retention Moneys
- Progress Payments
- Unconscionability
15.2 Keywords
- construction
- contract
- performance bond
- res judicata
- issue estoppel
- Singapore
- litigation
17. Areas of Law
16. Subjects
- Construction Dispute
- Contract Law
- Civil Procedure
- Performance Bonds
- Res Judicata
- Issue Estoppel