Resource Piling v Geospecs: Negligence in Soil Investigation & Economic Loss

Resource Piling Pte Ltd sued Geospecs Pte Ltd in the High Court of Singapore on 5 November 2013, alleging negligence in carrying out soil investigation works for a construction project. Resource Piling claimed that Geospecs' inaccurate borehole logs led to increased costs during the piling contract. The court, presided over by Quentin Loh J, dismissed Resource Piling's claim, holding that Geospecs did not owe a duty of care to Resource Piling.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Claim dismissed.

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Resource Piling sued Geospecs for negligent soil investigation leading to inaccurate borehole logs. The court dismissed the claim, finding no duty of care owed by Geospecs.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Resource Piling Pte LtdPlaintiffCorporationClaim DismissedLost
Geospecs Pte LtdDefendantCorporationClaim DismissedWon

3. Judges

Judge NameTitleDelivered Judgment
Quentin LohJudgeYes

4. Counsels

Counsel NameOrganization
Leo Cheng SuanInfinitus Law Corporation
Teh Ee-VonInfinitus Law Corporation
Thomas TanHaridass Ho & Partners
Lai Kwan WeiHaridass Ho & Partners

4. Facts

  1. Resource Piling contracted with a developer for piling work based on Geospecs' soil investigation report.
  2. Geospecs' borehole logs indicated rock was only present in two boreholes.
  3. Resource Piling encountered rock in 77% of piles where no rock was expected.
  4. Resource Piling sought extra payment from the developer, which was rejected.
  5. Resource Piling claimed Geospecs negligently prepared inaccurate borehole logs.
  6. The piling contract placed the risk of unexpected ground conditions on Resource Piling.
  7. The soil investigation contract was for $20,500, while the piling contract was for $3,608,488.41.

5. Formal Citations

  1. Resource Piling Pte Ltd v Geospecs Pte Ltd, Suit No 343 of 2011, [2013] SGHC 231

6. Timeline

DateEvent
Geospecs submitted a tender for soil investigation works.
Soil Investigation Contract awarded to Geospecs.
Geospecs conducted field exploration program.
Geospecs conducted field exploration program.
Geospecs submitted site investigation report.
Resource Piling received invitation to tender for piling work.
Resource Piling submitted tender for piling work.
Piling Contract awarded to Resource Piling.
Resource Piling drilled and constructed an ultimate test pile.
Soil & Foundation Pte Ltd prepared soil investigation report.
Resource Piling requested extra payment for socketing into rock.
Developer reported Resource Piling's encounter with rock to Geospecs.
Developer rejected Resource Piling’s claim.
Resource Piling reiterated its contractual right to extra payment.
Longrove rejected Resource Piling’s variation claim.
Geospecs drilled two boreholes adjacent to BH-1 and BH-11.
Resource Piling requested explanation from Geospecs for difference in soil profile.
Geospecs responded to issues raised in Resource Piling’s letter.
Developer stated that Geospecs Logs were accurate.
Resource Piling reiterated that Geospecs Logs were inaccurate.
Resource Piling issued writ of summons against Geospecs.
Judgment reserved.

7. Legal Issues

  1. Duty of Care
    • Outcome: The court held that Geospecs did not owe a duty of care to Resource Piling.
    • Category: Substantive
    • Sub-Issues:
      • Assumption of responsibility
      • Reasonable reliance
      • Proximity
      • Foreseeability
  2. Negligence
    • Outcome: The court found that Geospecs' soil investigation was negligently carried out and the Geospecs Logs were negligently logged and inaccurate.
    • Category: Substantive
    • Sub-Issues:
      • Breach of duty
      • Causation
      • Inaccurate soil investigation
      • Inaccurate borehole logs
  3. Economic Loss
    • Outcome: The court acknowledged that Resource Piling suffered economic losses but found that Geospecs was not liable for these losses.
    • Category: Substantive
    • Sub-Issues:
      • Miscalculation of tender price
      • Increased construction costs
      • Loss of anticipated profit

8. Remedies Sought

  1. Monetary Damages

9. Cause of Actions

  • Negligence

10. Practice Areas

  • Commercial Litigation
  • Construction Litigation

11. Industries

  • Construction

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Spandeck Engineering (S) Pte Ltd v Defence Science & Technology AgencyCourt of AppealYes[2007] 4 SLR(R) 100SingaporeCited as setting out the Spandeck Test for determining the imposition of a duty of care in negligence claims.
Ngiam Kong Seng and another v Lim Chiew HockCourt of AppealYes[2008] 3 SLR(R) 674SingaporeCited for the principle that factual foreseeability is a threshold condition that is readily satisfied in most cases.
Hedley Byrne & Co Ltd v Heller & Partners LtdHouse of LordsYes[1964] AC 465England and WalesCited as the starting point for claims involving negligent misstatements and the principle of assumption of responsibility.
Animal Concerns Research & Education Society v Tan Boon KweeUnknownYes[2011] 2 SLR 146SingaporeCited for the principle that the existence of a statutory duty does not automatically give rise to a common law duty of care.
Caparo Industries plc v DickmanHouse of LordsYes[1990] 2 AC 605England and WalesCited for the principle that a statutory duty does not extend to losses arising from a transaction outside the purpose for which a statement was made.
Tan Juay Pah v Kimly Construction Pte LtdUnknownYes[2012] 2 SLR 549SingaporeCited for the principle that the imposition of a common law duty of care may support or undermine the legislative intention behind the statutory regime.
M Miller Co v Dames & MooreCourt of Appeal of CaliforniaYes(1961) 198 Cal. App. 2d 305United StatesCited as a factual parallel where negligent soil tests were carried out by the defendant soil engineering firm under contract with the employer.
Edgeworth Construction Ltd v ND Lea & Associates LtdSupreme Court of CanadaYes(1993) 107 DLR (4th) 169CanadaCited as a similar conclusion and reasoning was adopted in Edgeworth, a decision of the Supreme Court of Canada.
R M Turton & Co (in liquidation) v Kerslake & PartnersNew Zealand Court of AppealYes[2000] 3 NZLR 406New ZealandCited as the New Zealand Court of Appeal came to a different conclusion in R M Turton & Co (in liquidation) v Kerslake & Partners [2000] 3 NZLR 406 (“R M Turton”).
J Jarvis and Sons Ltd v Castle Wharf Developments and othersCourt of AppealYes[2001] EWCA Civ 19England and WalesCited as a decision of the Court of Appeal in J Jarvis and Sons Ltd v Castle Wharf Developments and others [2001] EWCA Civ 19 (“J Jarvis”).
Galliford Try Infrastructure Ltd and another v Mott MacDonald LtdHigh CourtYes[2008] EWHC 1570England and WalesCited as a more recent High Court decision in Galliford Try Infrastructure Ltd and another v Mott MacDonald Ltd [2008] EWHC 1570 (“Galliford Try”).
Williams v Natural Life Health Foods LtdUnknownYes[1998] 1 WLR 830England and WalesCited for the principle that the basis of liability for negligent misstatements is that one party may owe a duty of care to another not to provide information negligently.
Henderson v Merrett Syndicates LtdUnknownYes[1995] 2 AC 145England and WalesCited for the principle that the assumption of responsibility principle is not confined to statements but may apply to any assumption of responsibility for the provision of services.
Sunny Metal & Engineering Pte Ltd v Ng Khim Ming Eric (practising under the name and style of W P Architects)UnknownYes[2007] 1 SLR(R) 853SingaporeCited for the principle that assumption of responsibility is to be understood in a legal rather than factual sense.
Sutherland Shire Council v HeymanHigh Court of AustraliaYes(1985) 60 ALR 1AustraliaCited for the principle that the requirement of proximity embraced the notions of physical proximity, circumstantial proximity and causal proximity.
McLoughlin v O’BrianUnknownYes[1983] 1 AC 410England and WalesCited for the three factors in McLoughlin v O’Brian [1983] 1 AC 410 within the context of the first proximity stage in the Spandeck Test for a claim involving a duty of care not to cause psychiatric harm.
Biakanja v IrvingUnknownYes(1959) 49 Cal. 2d 467United StatesCited for the principle that damages for negligent performance could be recovered if the transaction was intended to affect the plaintiff and injury to the plaintiff was foreseeable.
Pacific Associates Inc v BaxterUnknownYes[1990] 1 QB 993England and WalesCited for the principle that a certifier of work done under a contract did not owe a duty of care to the contractor to exercise professional skill and judgment in certifying payment for work done.
Simaan General Contracting Co v Pilkington Glass Ltd (No 2)UnknownYes[1988] QB 758England and WalesCited for the principle that when separate and independent contracts are involved, absent special circumstances, an assumption of responsibility in relation to economic loss is not readily found between parties who are brought into a relationship only because they are interposed by a mutual third party.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
Building Control ActSingapore
Building Control Regulations 2003Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • Soil investigation
  • Borehole logs
  • Piling contract
  • Duty of care
  • Negligence
  • Economic loss
  • Assumption of responsibility
  • Reasonable reliance
  • Proximity
  • Factual foreseeability
  • Spandeck Test
  • Rock socketing
  • Site investigation report

15.2 Keywords

  • Soil investigation
  • Negligence
  • Duty of care
  • Construction
  • Economic loss
  • Singapore
  • Building Control Act
  • Borehole logs
  • Piling contract

17. Areas of Law

Area NameRelevance Score
Soil Investigation80
Negligence75
Construction Law60
Building and Construction Contracts55
Contract Law50
Professional Negligence45
Economic Loss35
Property Law30

16. Subjects

  • Construction Dispute
  • Negligence
  • Duty of Care
  • Economic Loss