Super Continental v Essential Engineering: Breach of Contract & Defective UHT Plant

Super Continental Pte Ltd sued Essential Engineering & Construction Pte Ltd in the High Court of Singapore on 21 December 2010, alleging breach of contract for the supply and installation of a defective UHT plant and AFFS machine. Super Continental claimed the contract was a turnkey project and the UHT plant was not fit for its intended purpose. The court, presided over by Judith Prakash J, found that Essential Engineering had breached the contract by supplying a defective UHT plant, but the AFFS machine was not defective. The court awarded damages to Super Continental, including a refund for the UHT plant and compensation for lost profits, while also allowing Essential Engineering's counterclaim for amounts due under the contract for the AFFS machine.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Judgment for Plaintiff

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Super Continental sues Essential Engineering for breach of contract over a defective UHT plant. The court found in favor of Super Continental.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Super Continental Pte LtdPlaintiffCorporationJudgment for PlaintiffWon
Essential Engineering & Construction Pte LtdDefendantCorporationCounterclaim AllowedPartial

3. Judges

Judge NameTitleDelivered Judgment
Judith PrakashJudgeYes

4. Counsels

Counsel NameOrganization
Hee Theng FongKhattarWong
Lin Ying ClareKhattarWong
Seet Siok Lin NoelleKhattarWong
Esther YeeLee & Lee
Foo Yeung Chern MervynLee & Lee

4. Facts

  1. Plaintiff and defendant entered into a contract for the supply and installation of UHT machinery.
  2. The UHT plant was intended to produce UHT-treated liquid products in portion cups.
  3. The UHT plant was delivered late and had constant problems.
  4. The plaintiff claimed the UHT plant was not fit for its intended purpose.
  5. The defendant claimed its responsibility was simply to supply the UHT plant and AFFS machine.
  6. The UHT plant held the product at 140°C for 28 seconds, exceeding the specified 5 seconds.
  7. The Sterile Cooler did not effectively reduce the product temperature to the specified 30-35°C.

5. Formal Citations

  1. Super Continental Pte Ltd v Essential Engineering & Construction Pte Ltd, Suit No 458 of 2008, [2010] SGHC 365

6. Timeline

DateEvent
Contract signed for supply and installation of UHT machinery.
UHT plant delivered.
AFFS machine delivered.
Plaintiff complained of problems with the system.
Plaintiff stopped attempts at production.
Plaintiff informed defendant of fundamental breach of contract.
Action for rescission and/or damages started.
Judgment reserved.

7. Legal Issues

  1. Breach of Contract
    • Outcome: The court found that the defendant breached the contract by supplying a defective UHT plant.
    • Category: Substantive
    • Sub-Issues:
      • Failure to provide goods of satisfactory quality
      • Failure to provide goods fit for purpose
      • Breach of express terms
      • Breach of implied terms
  2. Fitness for Purpose
    • Outcome: The court found that the UHT plant was not reasonably fit for the purpose of producing products with a six-month shelf life.
    • Category: Substantive
    • Sub-Issues:
      • Inability to produce products with a six-month shelf life
      • Inadequate cleaning system
      • Failure to cool product to specified temperature
  3. Satisfactory Quality
    • Outcome: The court found that the UHT plant was not of satisfactory quality due to frequent breakdowns and lack of durability.
    • Category: Substantive
    • Sub-Issues:
      • Frequent breakdowns
      • Lack of durability
      • Inadequate cleaning system
  4. Damages
    • Outcome: The court awarded damages for loss of a chance to make profits and certain wasted costs, but disallowed the claim for replacement costs.
    • Category: Substantive
    • Sub-Issues:
      • Loss of profits
      • Wasted costs
      • Replacement costs

8. Remedies Sought

  1. Rescission of Contract
  2. Monetary Damages
  3. Refund of Amounts Paid

9. Cause of Actions

  • Breach of Contract
  • Breach of Implied Terms under Sale of Goods Act

10. Practice Areas

  • Commercial Litigation

11. Industries

  • Food and Beverage
  • Manufacturing

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Chaplin v HicksN/AYes[1911] 2 KB 786England and WalesCited regarding damages representing the plaintiff’s loss of a chance to make a profit.
Robertson Quay Investment Pte Ltd v Steen Consultants Pte Ltd and anotherCourt of AppealYes[2008] 2 SLR(R) 623SingaporeCited regarding the proof of damage and the flexible approach the court should adopt.
Asia Hotel Investments Ltd v Starwood Asia Pacific Management Pte Ltd and anotherN/AYes[2005] 1 SLR(R) 661SingaporeCited regarding the plaintiff only needing to show a real or substantial chance to obtain a profit in order for the court to award damages for loss of profits.
Straits Engineering Contracting Pte Ltd v Merteks Pte LtdN/AYes[1996] 1 SLR 227SingaporeCited regarding the plaintiff only needing to show a real or substantial chance to obtain a profit in order for the court to award damages for loss of profits.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
Sale of Goods Act (Cap 393, 1999 Rev Ed)Singapore
Supply of Goods Act (Cap 394, 1999 Rev Ed)Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • UHT Plant
  • AFFS Machine
  • Turnkey Project
  • Holding Time
  • Sterile Cooler
  • Dosing Temperature
  • Gelation
  • CIP System
  • Non-Dairy Creamer
  • Shelf-Life
  • Commissioning
  • Acceptance Form

15.2 Keywords

  • UHT
  • AFFS
  • Contract
  • Breach
  • Singapore
  • Food
  • Machinery
  • Damages
  • Sale of Goods Act

17. Areas of Law

Area NameRelevance Score
Breach of Contract90
Contract Law85
Sale of Goods70
Damages60
Warranty Law50
Commercial Litigation40
Commercial Law30
Performance of Contract30
Turnkey Contract30
Collections20

16. Subjects

  • Contract Dispute
  • Sale of Goods
  • Manufacturing
  • Machinery