Precise Development v Holcim: Dispute over Concrete Supply Contract due to Indonesian Sand Ban
Precise Development Pte Ltd (plaintiff), a construction company, sued Holcim (Singapore) Pte Ltd (defendant), a concrete supplier, in the High Court of Singapore on 17 November 2009, for breach of contract. The dispute arose from a contract where Holcim was to supply concrete for Precise Development's warehouse project. Following an Indonesian sand ban, Holcim sought to increase prices, which Precise Development rejected. The court found that Holcim breached the contract by failing to supply concrete at the agreed-upon prices and awarded interlocutory judgment to Precise Development, with damages to be assessed by the Registrar.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Interlocutory judgment for the plaintiff.
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Dispute over a concrete supply contract after an Indonesian sand ban. The court found Holcim breached the contract by failing to supply concrete.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Precise Development Pte Ltd | Plaintiff | Corporation | Interlocutory judgment for the plaintiff | Won | |
| Holcim (Singapore) Pte Ltd | Defendant | Corporation | Judgment against the defendant | Lost |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Lai Siu Chiu | Judge | Yes |
4. Counsels
4. Facts
- Precise Development and Holcim entered into a contract for the supply of concrete.
- The contract required Holcim to supply 90,000 cubic meters of concrete.
- An Indonesian sand ban caused a shortage of sand in Singapore.
- Holcim sought to increase the price of concrete due to the sand ban.
- Precise Development refused to pay the increased prices.
- BCA released sand from its stockpile to contractors.
- Holcim rejected Precise Development's offer to supply sand at pre-ban prices.
5. Formal Citations
- Precise Development Pte Ltd v Holcim (Singapore) Pte Ltd, Suit 424/2008, [2009] SGHC 256
6. Timeline
| Date | Event |
|---|---|
| Contract signed for the supply of ready-mixed concrete. | |
| Indonesian Government announced a ban on the export of sand. | |
| Holcim informed Precise Development of the sand ban. | |
| Holcim informed Precise Development it was unable to supply concrete based on the contract prices. | |
| BCA released sand from the national strategic stockpile. | |
| Holcim sent a quotation with increased prices to Precise Development. | |
| Precise Development refused to sign the 1 February quotation. | |
| Holcim informed Precise Development that the supply of aggregates to Singapore had been stopped by the Indonesian navy. | |
| Holcim informed Precise Development that the supply of sand and aggregates from Indonesia had ceased entirely. | |
| BCA imposed a price of $60 per ton for sand and $70 per ton for aggregates. | |
| Holcim sent another quotation with increased prices to Precise Development. | |
| Meeting held between Precise Development and Holcim representatives. | |
| Precise Development informed Holcim that it disagreed with the revised prices but would pay them without prejudice. | |
| Holcim sent another quotation to Precise Development. | |
| Precise Development indicated it would accept the 2 April quotation with additional terms. | |
| Precise Development issued an ultimatum to Holcim. | |
| Holcim rejected Precise Development’s ultimatum. | |
| Precise Development commenced suit against Holcim. | |
| Judgment reserved. |
7. Legal Issues
- Breach of Contract
- Outcome: The court found that the defendant breached the contract by failing to supply concrete at the agreed-upon prices.
- Category: Substantive
- Sub-Issues:
- Failure to supply concrete at agreed prices
- Repudiation of contract
- Force Majeure
- Outcome: The court found that the force majeure clause did not excuse the defendant's failure to supply concrete.
- Category: Substantive
- Sub-Issues:
- Disruption of supply due to shortage of materials
- Circumstances beyond the supplier's control
- Contract Termination
- Outcome: The court found that the defendant did not effectively exercise its right to terminate the contract.
- Category: Substantive
- Sub-Issues:
- Validity of termination notice
- Compliance with termination clause requirements
8. Remedies Sought
- Damages for breach of contract
9. Cause of Actions
- Breach of Contract
10. Practice Areas
- Commercial Litigation
- Construction Disputes
11. Industries
- Construction
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Glahe International Expo AG v ACS Computer Ltd | High Court | Yes | [1999] 2 SLR 620 | Singapore | Cited for the definition of frustration of contract. |
| Davis Contractors Ltd v Fareham Urban District Council | House of Lords | Yes | [1956] A.C. 696 | England | Cited for the definition of frustration of contract. |
| RDC Concrete Pte Ltd v Sato Kogyo (S) Pte Ltd | Court of Appeal | Yes | [2007] 4 SLR 413 | Singapore | Cited for the principles relating to force majeure clauses. |
| Holcim (Singapore) Pte Ltd v Kwan Yong Construction Pte Ltd | High Court | Yes | [2008] SGHC 231 | Singapore | Cited as a case with similar facts where the contract was found to be frustrated due to a shortage of sand. |
| Zurich Insurance (Singapore) Pte Ltd v B-Gold Interior Design & Construction Pte Ltd | Court of Appeal | Yes | [2008] 3 SLR 1029 | Singapore | Cited for the principles of contractual interpretation. |
| Tennants (Lancashire), Limited v. C. S. Wilson and Company, Limited | House of Lords | Yes | [1917] A.C. 495 | England | Cited for the interpretation of the word 'hinder' in a force majeure clause. |
| Peter Dixon & Sons, Limited v. Henderson, Craig & Co., Limited | King's Bench Division | Yes | [1919] 2 K.B. 778 | England | Followed Tennants regarding the interpretation of 'hinder' and the effect of price fluctuations. |
| Westfalische Central - Gennossenschaft v Seabright Chemicals Ltd | English Court of Appeal | Yes | 22 July 1980 | England | Followed Tennants regarding the interpretation of 'hinder' in a force majeure clause. |
| Afovos Shipping Co. S.A. v. Romano Pagnan and Pietro Pagnan | House of Lords | Yes | [1983] 1 W.L.R. 195 | England | Cited regarding the requirements for a valid termination notice. |
| Central Provident Fund Board v Ho Bock Kee | Court of Appeal | Yes | [1981] 1 MLJ 162 | Malaysia | Cited regarding the requirements for a valid termination notice. |
| GYC Financial Planning Pte Ltd and Another v Prudential Assurance Company Singapore (Pte) Ltd | High Court | Yes | [2006] 2 SLR 865 | Singapore | Cited regarding the requirements for a valid termination notice. |
| Goh Kim Hai Edward v Pacific Can Investment Holdings Ltd | High Court | Yes | [1996] 2 SLR 109 | Singapore | Cited regarding the requirements for a valid termination notice. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| No applicable statutes | |
15. Key Terms and Keywords
15.1 Key Terms
- Ready-mixed concrete
- Sand ban
- Force majeure clause
- Disruption of supply
- Termination notice
- Contract prices
- BCA stockpile
15.2 Keywords
- concrete
- contract
- sand ban
- force majeure
- breach of contract
- construction
- supply agreement
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Contract Law | 95 |
| Breach of Contract | 90 |
| Force Majeure | 85 |
| Construction Law | 60 |
| Ready-Mixed Concrete | 50 |
16. Subjects
- Contract Law
- Construction Law
- Supply Agreements
- Force Majeure