Taisei Corp v Doo Ree Engineering: Setting Aside Adjudication Determination Under Security of Payment Act

In Taisei Corp v Doo Ree Engineering & Trading Pte Ltd, the High Court of Singapore heard an application by Taisei Corporation to set aside an adjudication determination in favor of Doo Ree Engineering under the Building and Construction Industry Security of Payment Act. The court, presided over by Francis Ng Yong Kiat AR, allowed Taisei's application on 3 July 2009, finding that Doo Ree's adjudication application was premature because Clause 16.3 of the draft sub-contract was binding on the parties. The court held that the adjudicator lacked jurisdiction to make the determination.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Application allowed and adjudication determination set aside.

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Taisei Corp sought to set aside an adjudication determination in favor of Doo Ree Engineering. The court allowed the application, finding the adjudication premature.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Doo Ree Engineering & Trading Pte LtdDefendantCorporationAdjudication determination set asideLost
Taisei CorpPlaintiffCorporationApplication allowedWon

3. Judges

Judge NameTitleDelivered Judgment
Francis Ng Yong KiatAssistant RegistrarYes

4. Counsels

Counsel NameOrganization
Monica NeoTSMP Law Corporation
Thio Ying YingKelvin Chia Partnership
Tan Yeow HiangKelvin Chia Partnership

4. Facts

  1. Taisei was appointed as the main contractor by the Land Transport Authority.
  2. Taisei appointed Doo Ree as its sub-contractor for reinforced concrete works.
  3. A Letter of Award was issued to Doo Ree on 7 November 2006.
  4. Taisei terminated Doo Ree’s appointment on 4 October 2008.
  5. Doo Ree submitted its 25th payment claim on 29 November 2008.
  6. Doo Ree lodged an adjudication application on 19 December 2008.
  7. The adjudicator determined that Doo Ree had succeeded in its claim to the extent of $444,503.18.

5. Formal Citations

  1. Taisei Corp v Doo Ree Engineering & Trading Pte Ltd, OS 388/2009, [2009] SGHC 156

6. Timeline

DateEvent
Letter of Award issued to Doo Ree
Draft of Letter of Award forwarded to Doo Ree
Letter of Award signed by Taisei and Doo Ree
Taisei terminated Doo Ree’s appointment
Doo Ree submitted its 25th payment claim
Doo Ree gave notice of intention to apply for adjudication
Doo Ree lodged an adjudication application with the Singapore Mediation Centre
Taisei responded to Doo Ree’s notice and enclosed a payment response
Adjudication commenced
Adjudication determination made
Adjudication determination amended
Taisei commenced proceedings to set aside the adjudication determination
Court allowed the application to set aside the adjudication determination

7. Legal Issues

  1. Premature Adjudication Application
    • Outcome: The court held that the adjudication application was premature and the adjudicator lacked jurisdiction.
    • Category: Jurisdictional
    • Sub-Issues:
      • Failure to comply with statutory timelines
      • Incorrect interpretation of contract terms
  2. Incorporation of Contractual Terms by Reference
    • Outcome: The court held that Clause 16.3 of the draft sub-contract was incorporated by reference into the sub-contract between the parties.
    • Category: Substantive
    • Sub-Issues:
      • Sufficiency of reference to incorporate
      • Whether document was forwarded to other party

8. Remedies Sought

  1. Setting aside of adjudication determination

9. Cause of Actions

  • Statutory Claim under the Building and Construction Industry Security of Payment Act

10. Practice Areas

  • Construction Law
  • Commercial Litigation
  • Arbitration

11. Industries

  • Construction

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Brodyn Pty Ltd v DavenportNew South Wales Court of AppealYes[2004] NSWCA 394New South WalesCited regarding essential pre-conditions for the existence of an adjudicator’s determination.
C & B Scene Concept Design Ltd v Isobars LtdEnglish Court of AppealYes[2002] BLR 93England and WalesCited regarding whether an error of fact or law on the part of an adjudicator would prevent a determination from being an adjudication determination.
The Minister for Commerce (formerly Public Works and Services) v Contrax Plumbing (NSW) Pty LtdSupreme Court of New South WalesYes[2005] NSWCA 142New South WalesCited regarding whether an error of fact or law on the part of an adjudicator would prevent a determination from being an adjudication determination.
Multipower v S & H ElectricsSupreme Court of New South WalesYes[2006] NSWSC 757New South WalesCited regarding whether an adjudicator's error in finding that an adjudication application complied with statutory timelines is a basis for declaring the adjudication determination void.
JAR Developments Pty Ltd v Castleplex Pty LtdSupreme Court of New South WalesYes[2007] NSWSC 737New South WalesCited regarding whether an adjudicator's error in finding that an adjudication application complied with statutory timelines is a basis for declaring the adjudication determination void.
Firedam Civil Engineering v KJP ConstructionSupreme Court of New South WalesYes[2007] NSWSC 1162New South WalesCited regarding the validity of an adjudication determination when the adjudicator incorrectly determined that the adjudication application was lodged within the statutorily prescribed time limit.
Kell & Rigby Pty Ltd v Guardian International Properties Pty LtdSupreme Court of New South WalesYes[2007] NSWSC 554New South WalesCited regarding the consequences of failing to comply with mandatory conditions for making an adjudication application.
Tiong Seng Contractors (Pte) Ltd v Chuan Lim Construction Pte LtdSingapore Court of AppealYes[2007] 4 SLR 364SingaporeCited for the proposition that Singapore courts rely on decisions from New South Wales courts when interpreting the provisions of the SOP Act.
Chip Hup Hup Kee Construction Pte Ltd v Ssangyong Engineering & Construction Co LtdSingapore High CourtYes[2008] SGHC 159SingaporeCited for the proposition that Singapore courts rely on decisions from New South Wales courts when interpreting the provisions of the SOP Act.
Company BW v Company BXSingapore High CourtYes[2006] SGSOP 15SingaporeCited as an example of an adjudication application being rejected pursuant to section 16(2)(a) of the SOP Act for being made after the prescribed period.
Fifty Property Investments Pty Ltd v Barry J O’MaraSupreme Court of New South WalesYes[2006] NSWSC 428New South WalesCited regarding the court's power to review a decision maker's finding that the necessary facts to found jurisdiction exist.
Smith and another v South Wales Switchgear Co LtdHouse of LordsYes[1978] 1 WLR 165United KingdomCited regarding the sufficiency of a reference in a purchase order to incorporate provisions in general conditions of contract.
L & M Concrete Specialists Pte Ltd v United Eng Contractors Pte LtdSingapore High CourtYes[2000] 4 SLR 441SingaporeCited regarding the requirements for incorporating an arbitration clause into a contract.
Press Automation Technology Pte Ltd v Trans-Link Exhibition Forwarding Pte LtdSingapore High CourtYes[2003] 1 SLR 712SingaporeCited regarding the incorporation of standard trading conditions by reference into a contract.
Shia Kian Eng (trading as Forest Contractors) v Nakano Singapore (Pte) LtdSingapore High CourtYes[2001] SGHC 68SingaporeCited regarding the incorporation of documents by reference into a contract.
Chip Hup Hup KeeSingapore High CourtYes[2006] SGHC 159SingaporeCited regarding the court's discretion to refuse to set aside an adjudication determination.

13. Applicable Rules

Rule Name
Rules of Court Order 95 rule 3(1)
Rules of Court Order 95 rule 3(4)

14. Applicable Statutes

Statute NameJurisdiction
Building and Construction Industry Security of Payment Act (Cap 30B)Singapore
Building and Construction Industry Security of Payment Regulations 2005Singapore
Interpretation Act (Cap 1)Singapore
Unfair Contract Terms Act (Cap 396)Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • Adjudication determination
  • Security of Payment Act
  • Payment claim
  • Payment response
  • Adjudication application
  • Letter of Award
  • Sub-contract
  • Incorporation by reference
  • Jurisdiction
  • Premature
  • Draft sub-contract
  • Clause 16.3

15.2 Keywords

  • adjudication
  • security of payment
  • construction
  • contract
  • Singapore

17. Areas of Law

Area NameRelevance Score
Building and Construction Industry Security of Payment Act90
Construction Law75
Statutory Interpretation50
Administrative Law25

16. Subjects

  • Construction Dispute
  • Adjudication
  • Contract Law
  • Security of Payment