Keppel FELS v International Coatings: Liability for Defective Marine Paint & Soluble Salt Contamination

Keppel FELS Limited, a shipbuilder, sued International Coatings Pte Ltd and International Coatings Ltd in the High Court of Singapore, alleging damages due to defective paint supplied for a floating dock built for Hong Kong United Dockyard Ltd (HUD). Keppel FELS claimed the paint blistering was due to soluble salt contamination, which International Coatings failed to address in their specifications. Tay Yong Kwang JC found International Coatings liable for failing to advise on proper surface preparation, awarding damages to Keppel FELS. The claim against International Coatings Ltd and the counterclaim by International Coatings Pte Ltd were dismissed.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Judgment for the Plaintiffs against the First Defendants with costs and interest. Claim against the Second Defendants and the First Defendants’ Counterclaim dismissed.

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Keppel FELS sued International Coatings for damages due to defective paint on a floating dock. The court found International Coatings liable for failing to advise on proper surface preparation.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Keppel FELS LimitedPlaintiffCorporationJudgment for Plaintiff, Legal costs in arbitration awarded to PlaintiffWon, WonGoh Phai Cheng, Goh Kok Leong, Dennis Tan, Mathiew Rajoo
International Coatings Pte Ltd (formerly known as Courtaulds Coatings Singapore Pte Ltd)DefendantCorporationJudgment against Defendant, Legal costs in arbitration awarded against Defendant, Counterclaim DismissedLost, Lost, DismissedMichael Hwang, Christopher Daniel, Sharon Lee
International Coatings LtdDefendantCorporationClaim DismissedDismissedMichael Hwang, Christopher Daniel, Sharon Lee

3. Judges

Judge NameTitleDelivered Judgment
Tay Yong KwangJudicial CommissionerYes

4. Counsels

Counsel NameOrganization
Goh Phai ChengAng & Partners
Goh Kok LeongAng & Partners
Dennis TanAng & Partners
Mathiew RajooAng & Partners
Michael HwangAllen & Gledhill
Christopher DanielAllen & Gledhill
Sharon LeeAllen & Gledhill

4. Facts

  1. Keppel FELS built a floating dock for HUD using marine paints supplied by International Coatings.
  2. Defects, in the form of blisters, appeared in the paint coating of the internal bulkheads of the ballast tanks.
  3. The blisters were determined to be caused by osmotic blistering due to salt contamination.
  4. International Coatings' specifications did not adequately address the risk of soluble salt contamination.
  5. Keppel FELS settled with HUD for US$7,550,000 due to the paint defects.
  6. The original contract between Keppel FELS and International Coatings was worth less than S$1 million.

5. Formal Citations

  1. Keppel FELS Limited v International Coatings Pte Ltd, Suit 1595/1999, [2002] SGHC 115

6. Timeline

DateEvent
Plaintiffs agreed to build a floating dock for HUD.
First Defendants sent a quotation for the supply of paints.
Plaintiffs placed various orders for the supply of marine coatings.
Plaintiffs placed various orders for the supply of marine coatings.
Floating dock delivered to HUD.
HUD informed the Plaintiffs of defects in the coating.
Joint inspection of ballast tanks conducted.
Second joint inspection of the ballast tank coating conducted.
Trial repair carried out in bay 10 of number 7 port wing tank.
Repair contract awarded by HUD to Guangzhou Wenchong Shipyard.
Floating dock towed to Guangzhou Wenchong Shipyard.
Floating dock returned to Hong Kong.
HUD commenced arbitration proceedings against the Plaintiffs in London.
Plaintiffs entered into a settlement agreement with HUD.
Decision Date

7. Legal Issues

  1. Breach of Contract
    • Outcome: The court found that the First Defendants breached their duty to provide a proper paint system, including proper surface preparation.
    • Category: Substantive
    • Sub-Issues:
      • Failure to provide proper specifications
      • Failure to advise on proper surface preparation
  2. Negligence
    • Outcome: The court implicitly found negligence in the First Defendants' failure to advise on the risk of soluble salt contamination and the need for high-pressure freshwater washing.
    • Category: Substantive
    • Sub-Issues:
      • Failure to warn of soluble salt contamination
      • Inadequate specifications

8. Remedies Sought

  1. Damages
  2. Indemnity
  3. Interest
  4. Costs

9. Cause of Actions

  • Breach of Contract
  • Negligence

10. Practice Areas

  • Commercial Litigation
  • Construction Law

11. Industries

  • Construction
  • Shipbuilding

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Banco De Portugal v Waterlow & Sons LtdN/AYes[1932] AC 452N/ACited regarding the measures taken by a sufferer from a breach of contract to extricate himself.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
No applicable statutes

15. Key Terms and Keywords

15.1 Key Terms

  • Osmotic blistering
  • Soluble salts
  • DFT
  • Surface preparation
  • Marine coatings
  • Ballast tanks
  • Cathodic disbondment
  • High pressure freshwater washing

15.2 Keywords

  • marine paint
  • soluble salt contamination
  • osmotic blistering
  • Keppel FELS
  • International Coatings
  • floating dock
  • construction
  • breach of contract
  • negligence

16. Subjects

  • Contract Dispute
  • Construction Dispute
  • Marine Paint
  • Defective Goods

17. Areas of Law

  • Contract Law
  • Building and Construction Law