Chip Hup Hup Kee v Ssangyong: Security of Payment Act Dispute over Progress Claim Validity and Adjudicator's Jurisdiction
Chip Hup Hup Kee Construction Pte Ltd ("Chip Hup") and Ssangyong Engineering & Construction Co Ltd ("Ssangyong") were in dispute over Progress Claim No 5. Chip Hup applied for adjudication under the Building and Construction Industry Security of Payment Act (SOP Act). Ssangyong challenged the adjudicator's jurisdiction and the validity of the progress claim. The High Court of Singapore dismissed Ssangyong's appeal, upholding the adjudicator's jurisdiction and finding that Ssangyong had waived its right to challenge the validity of Progress Claim 5. The court agreed with the Assistant Registrar's interpretation of sections 15(c) and 16(7) of the SOP Act.
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 an adjudication determination under the SOP Act. The court upheld the adjudicator's jurisdiction and found the respondent waived its right to challenge the progress claim's validity.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Chip Hup Hup Kee Construction Pte Ltd | Claimant, Appellant | Corporation | Appeal Dismissed | Won | Melvin Chan, Debby Lim |
| Ssangyong Engineering & Construction Co Ltd | Respondent | Corporation | Appeal Dismissed | Lost | Soh Lip San, Sim Chee Siong |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Judith Prakash | Judge | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Melvin Chan | TSMP Law Corporation |
| Debby Lim | TSMP Law Corporation |
| Soh Lip San | Rajah & Tann LLP |
| Sim Chee Siong | Rajah & Tann LLP |
4. Facts
- Ssangyong appointed Chip Hup as its subcontractor for reinforced concrete structural works.
- Chip Hup served Progress Claim No 5 for $1,616,207.149 on Ssangyong.
- Ssangyong did not pay the claim or provide a payment response by the deadline.
- Chip Hup served a Notice of Intention to Apply for Adjudication.
- Chip Hup submitted its Adjudication Application to the Singapore Mediation Centre.
- Ssangyong provided its payment response after the deadline.
- The Adjudicator determined that $1,103,101.49 was due to Chip Hup under Progress Claim 5.
5. Formal Citations
- Chip Hup Hup Kee Construction Pte Ltd v Ssangyong Engineering & Construction Co Ltd, OS 894/2008, RA 409/2008, [2009] SGHC 237
6. Timeline
| Date | Event |
|---|---|
| Claimant appointed as subcontractor. | |
| Claimant served Progress Claim No 5 on the respondent. | |
| Deadline for respondent to provide payment response. | |
| Claimant reminded the respondent to provide its payment response. | |
| End of dispute settlement period. | |
| Claimant served Notice of Intention to Apply for Adjudication and submitted Adjudication Application. | |
| SMC served a copy of the Adjudication Application on the respondent; respondent provided its payment response. | |
| SMC appointed Mr Goh Phai Cheng as the Adjudicator. | |
| Respondent’s Adjudication Response was filed. | |
| Adjudication conference held. | |
| Adjudicator issued his adjudication determination. | |
| Adjudication amount was due and payable. | |
| Claimant filed originating summons to enforce the adjudication determination. | |
| Respondent filed summons to set aside the Determination and paid the unpaid portion of the adjudicated amount into court. | |
| Assistant Registrar's judgment issued. | |
| Respondent's engineering team manager, Kim Jin Soo, filed an affidavit. | |
| High Court decision date. |
7. Legal Issues
- Adjudicator's Jurisdiction
- Outcome: The court held that the adjudicator had jurisdiction based on appointment by the SMC, not on the validity of the payment claim.
- Category: Jurisdictional
- Sub-Issues:
- Validity of payment claim
- Compliance with SOP Act requirements
- Related Cases:
- [2006] 2 SLR 830
- [2007] 1 WLR 2982
- [2003] NSWSC 365
- [2003] BLR 241
- [2007] BLR 499
- [1925] SSLR 4
- [2003] NSWSC 869
- Validity of Progress Claim
- Outcome: The court did not rule on the validity of Progress Claim 5, finding that the respondent had waived its right to challenge it.
- Category: Substantive
- Sub-Issues:
- Compliance with s 10(2)(a) of the SOP Act
- Compliance with reg 7(2)(d) of the Building and Construction Industry Security of Payment Regulations (Cap 30B, RGI 2006 Rev Ed)
- Interpretation of s 15(3) of the SOP Act
- Outcome: The court agreed with the AR and Adjudicator's interpretation that s 15(3) precludes consideration of reasons for withholding payment not included in a valid payment response.
- Category: Statutory Interpretation
- Sub-Issues:
- Exclusion of reasons for withholding payment not included in a valid payment response
- Interpretation of s 16(7) of the SOP Act
- Outcome: The court agreed with the AR's interpretation that s 16(7) is permissive and does not compel the adjudicator to give consideration to any matter not contained in s 17(3) of the SOP Act.
- Category: Statutory Interpretation
- Sub-Issues:
- Adjudicator's power to determine application despite failure to provide payment response
- Waiver of Right to Challenge Jurisdiction
- Outcome: The court found that the respondent had waived its right to challenge the validity of Progress Claim 5 by participating in the proceedings without raising the issue earlier.
- Category: Procedural
- Sub-Issues:
- Estoppel
- Submission to jurisdiction
- Related Cases:
- [2006] 2 SLR 830
- [2003] NSWSC 365
- [2003] BLR 241
- [2007] BLR 499
8. Remedies Sought
- Enforcement of Adjudication Determination
- 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 Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Koh Zhan Quan Tony v PP | Court of Appeal | Yes | [2006] 2 SLR 830 | Singapore | Cited regarding the principle that objections to jurisdiction can be raised at the appeal stage, but distinguished based on the specific facts of the case. |
| Contour Homes Ltd v Rowen | N/A | Yes | [2007] 1 WLR 2982 | England and Wales | Cited for the principle that statutory jurisdiction cannot be increased or reduced by parties' consent. |
| Macob Civil Engineering Ltd v Morrison Construction Ltd | N/A | Yes | [1999] CLC 739 | England and Wales | Cited to support the view that the adjudication process is an intervening provisional stage in the dispute resolution process. |
| Parist Holdings Pty Ltd v Wt Partnership Australia Pty Ltd | New South Wales Supreme Court | Yes | [2003] NSWSC 365 | Australia | Cited as a decision on the Building Construction Industry Security of Payment Act 1999 (NSW Act), which is the basis for the SOP Act. It supports the view that an adjudicator's jurisdiction stems from appointment, not from a properly completed payment claim. |
| Cowlin Construction Limited v CFW Architects | High Court of England | Yes | [2003] BLR 241 | England and Wales | Cited for the principle that a party can waive their rights to object to jurisdiction by participating in the adjudication process. |
| AC Yule & Son Limited v Speedwell Roofing & Cladding Limited | N/A | Yes | [2007] BLR 499 | England and Wales | Cited with approval of Cowlin, for the principle that a party cannot go behind the acceptance of the jurisdictional role of the adjudicator at an early stage. |
| Sea Calm Shipping Co SA v Chantiers Navals de L’Esterel SA | N/A | Yes | [1986] 2 Lloyd’s Rep 294 | N/A | Cited in Cowlin Construction Limited v CFW Architects for the principle of waiver where a party submits to the jurisdiction of an arbitrator. |
| Then Kang Chu v Tan Kim Hoe | N/A | Yes | [1925] SSLR 4 | Singapore | Cited for the distinction between competence to hear and the exercise of jurisdiction, and that only the latter can be waived. |
| Paynter Dixon Constructions Pty Limited v Jf and Cg Tilston Pty Limited | New South Wales Supreme Court | Yes | [2003] NSWSC 869 | Australia | Cited with approval of Parist Holdings Pty Ltd v Wt Partnership Australia Pty Ltd for the principle that the adjudicator's jurisdiction is not founded on the payment claim. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Building and Construction Industry Security of Payment Act (Cap 30B, 2006 Rev Ed) | Singapore |
| s 10 of the SOP Act | Singapore |
| s 10(1) of the SOP Act | Singapore |
| s 10(2)(a) of the SOP Act | Singapore |
| s 11 of the SOP Act | Singapore |
| s 11(1) of the SOP Act | Singapore |
| s 12 of the SOP Act | Singapore |
| s 12(2) of the SOP Act | Singapore |
| s 13 of the SOP Act | Singapore |
| s 13(1) of the SOP Act | Singapore |
| s 13(3) of the SOP Act | Singapore |
| s 13(3)(c) of the SOP Act | Singapore |
| s 14(1) of the SOP Act | Singapore |
| s 14(3) of the SOP Act | Singapore |
| s 15(3) of the SOP Act | Singapore |
| s 16 of the SOP Act | Singapore |
| s 16(1) of the SOP Act | Singapore |
| s 16(2) of the SOP Act | Singapore |
| s 16(3) of the SOP Act | Singapore |
| s 16(4) of the SOP Act | Singapore |
| s 16(7) of the SOP Act | Singapore |
| s 2 of the SOP Act | Singapore |
| s 5 of the SOP Act | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Adjudication
- Adjudication Application
- Adjudication Response
- Adjudicator
- Building and Construction Industry Security of Payment Act
- Payment Claim
- Payment Response
- Progress Claim
- Jurisdiction
- Waiver
15.2 Keywords
- SOP Act
- Adjudication
- Construction
- Payment Claim
- Jurisdiction
- Waiver
16. Subjects
- Construction Dispute
- Adjudication
- Security of Payment
- Jurisdiction
- Waiver
17. Areas of Law
- Building and Construction Law
- Dispute Resolution
- Alternative Dispute Resolution Procedures
- Construction Adjudication
- Security of Payment