SM Integrated Transware v Schenker Singapore: Lease Agreement Dispute
SM Integrated Transware Pte Ltd (SMI) sued Schenker Singapore (Pte) Ltd (Schenker) in the High Court of Singapore, Judith Prakash J presiding, on 30 March 2005, for damages resulting from Schenker's failure to lease SMI's warehouse. SMI claimed a concluded lease agreement existed, while Schenker denied it. The court found that a concluded contract existed based on e-mail correspondence and the Logistics Service Agreement, and ruled in favor of SMI, awarding damages and costs.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Judgment for Plaintiff
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
SMI sued Schenker for repudiating a warehouse lease agreement. The court found a concluded contract existed and ruled in favor of SMI.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| SM Integrated Transware Pte Ltd | Plaintiff | Corporation | Judgment for Plaintiff | Won | Kannan Ramesh, Ang Wee Tiong, Dawn Chew |
| Schenker Singapore (Pte) Ltd | Defendant | Corporation | Claim Dismissed | Lost | Boo Moh Cheh, Mohamed Ibrahim |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Judith Prakash | Judge | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Kannan Ramesh | Tan Kok Quan Partnership |
| Ang Wee Tiong | Tan Kok Quan Partnership |
| Dawn Chew | Tan Kok Quan Partnership |
| Boo Moh Cheh | Kurup and Boo |
| Mohamed Ibrahim | Kurup and Boo |
4. Facts
- SMI sued Schenker for damages due to Schenker's failure to lease a warehouse.
- Schenker initially sought the warehouse to service a contract with Merck.
- Negotiations occurred via email and meetings between October 2002 and February 2003.
- Schenker sent an email on 20 December 2002 confirming they would proceed with the lease.
- A draft Logistics Service Agreement (LSA) was created and exchanged.
- Merck withdrew from its agreement with Schenker on 10 February 2003.
- Schenker then informed SMI on 11 February 2003 that it would not proceed with the lease.
5. Formal Citations
- SM Integrated Transware Pte Ltd v Schenker Singapore (Pte) Ltd, Suit 594/2003, [2005] SGHC 58
6. Timeline
| Date | Event |
|---|---|
| SMI's warehouse occupied by Richland Logistics Pte Ltd, lease nearing expiration. | |
| Daniel Heng of SMI met with Roman Claus Luth to discuss warehouse lease. | |
| Emails exchanged regarding warehouse viewing and trucking quotation. | |
| Schenker staff viewed the warehouse. | |
| SMI sent Schenker a letter of intent marked 'Subject to Contract'. | |
| Heng and Luth spoke on the phone about Schenker's decision. | |
| Schenker requested a further extension of time. | |
| Tan and Luth went to SMI’s office for a meeting. | |
| Tan informed SMI that Schenker had a good meeting with Merck. | |
| Merck sent Schenker an amended copy of its logistics service agreement. | |
| Tan informed Heng that Schenker would like to lease the warehouse. | |
| Tan sent Heng an e-mail confirming Schenker's intention to lease the warehouse. | |
| Yong drew up a document entitled “Handling Service Agreement” | |
| Tan sent an e-mail to Heng stating that he wanted the handling agreement amended. | |
| Tan forwarded the draft handling agreement to Schenker’s solicitors. | |
| Meeting held to discuss the date of the handover of the warehouse. | |
| Tan sent an e-mail to Yong accepting the points stated in Yong's email. | |
| Schenker had a meeting with Merck. | |
| Schenker’s contractors installed some bar codes on the racks in the warehouse. | |
| Meeting held to discuss the solicitors’ comments. | |
| Yong sent Tan, Chai and Heng the revised agreement. | |
| Tan sent an e-mail to Yong regarding the contract. | |
| Yong sent the amended draft LSA to Tan. | |
| Handover inspection held at the warehouse. | |
| Merck sent Schenker an e-mail stating that its outsourcing requirements had to be put on hold. | |
| Tan informed SMI that Merck had pulled out of the project. | |
| Tan had a meeting with Heng and Yong. | |
| Intended commencement date of the lease. | |
| Judgment reserved. |
7. Legal Issues
- Breach of Contract
- Outcome: The court found that Schenker breached a concluded lease agreement with SMI.
- Category: Substantive
- Sub-Issues:
- Repudiation of lease
- Failure to fulfill lease obligations
- Formalities of Contract
- Outcome: The court held that the e-mail correspondence satisfied the writing and signature requirements of Section 6(d) of the Civil Law Act.
- Category: Substantive
- Sub-Issues:
- Requirement of written agreement
- Sufficiency of e-mail correspondence as memorandum
- Satisfaction of signature requirement
- Conditions Precedent
- Outcome: The court found that the lease agreement was not subject to any implied conditions precedent that had not been fulfilled.
- Category: Substantive
- Sub-Issues:
- Implied conditions
- Failure of condition to materialize
8. Remedies Sought
- Monetary Damages
9. Cause of Actions
- Breach of Contract
10. Practice Areas
- Commercial Litigation
- Lease Agreements
11. Industries
- Logistics
- Warehousing
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Masa-Katsu Japanese Restaurant Pte Ltd v Amara Hotel Properties Pte Ltd | Unknown | Yes | [1999] 2 SLR 332 | Singapore | Cited for the essential terms of a lease agreement: identification of premises, parties, term commencement and duration, and rent. |
| Hiap Hong & Co Pte Ltd v Hong Huat Development Co (Pte) Ltd | Court of Appeal | Yes | [2001] 2 SLR 458 | Singapore | Cited for the principle that the touchstone for the implication of terms is necessity and not merely reasonableness. |
| Cohen v Nessdale Ltd | English High Court | Yes | [1981] 3 All ER 118 | England and Wales | Cited to argue that the term 'subject to contract' can continue to apply to resumed negotiations, but distinguished by the court. |
| Wilkens v Iowa Insurance Commissioner | Court of Appeals of Iowa | Yes | 457 NW 2d 1 (Iowa App 1990) | United States | Cited to support the argument that a computer record can be considered a 'written record'. |
| Clyburn v Allstate Insurance Company | District Court for South Carolina | Yes | 826 F Supp 955 (DSC 1993) | United States | Cited to support the argument that a computer floppy diskette can constitute 'written notice'. |
| Shattuck v Klotzbach | Superior Court of Massachusetts | Yes | 14 Mass L Rep 360 (2001) | United States | Cited to support the argument that a typed name at the end of an e-mail can satisfy the signature requirement of the statute of frauds. |
| Cloud Corporation v Hasbro, Inc | US Court of Appeals for the Seventh Circuit | Yes | 314 F 3d 289 (2002) | United States | Cited to support the argument that e-mails sent by the defendant’s representative can satisfy the signature requirement of the statute of frauds. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Civil Law Act (Cap 43, 1994 Rev Ed) | Singapore |
| Interpretation Act (Cap 1, 2002 Rev Ed) | Singapore |
| Electronic Transactions Act (Cap 88, 1999 Rev Ed) | Singapore |
| Fire Safety Act (Cap 109A, 2000 Rev Ed) | Singapore |
| Wills Act (Cap 352, 1996 Rev Ed) | Singapore |
| Land Titles (Strata) Act (Cap 158, 1999 Rev Ed) | Singapore |
| Companies Act (Cap 50, 1994 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Lease Agreement
- Warehouse
- Repudiation
- Letter of Intent
- Logistics Service Agreement
- Condition Precedent
- Electronic Transactions Act
- Civil Law Act
- E-mail Correspondence
- Signature Requirement
15.2 Keywords
- lease agreement
- warehouse
- contract law
- electronic transactions
- Schenker
- SM Integrated Transware
16. Subjects
- Contract Law
- Lease Agreements
- Electronic Commerce
17. Areas of Law
- Contract Law
- Landlord and Tenant
- Civil Procedure
- Electronic Transactions Law