Olivine Capital v Chia Chin Yan: Contract Interpretation & Mistake in Sewer Damage Claim

Olivine Capital Pte Ltd and Ong Puay Guan @ Steven Ong appealed against the High Court's decision regarding a dispute with Chia Chin Yan over liability for damage to a sewer during a redevelopment project. The Court of Appeal allowed the appeal, setting aside the lower court's decision and remitting the case for trial, finding that the interpretation of a compromise letter and the issue of mistake were not suitable for summary determination.

1. Case Overview

1.1 Court

Court of Appeal

1.2 Outcome

Appeal Allowed

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Appeal regarding a contract's interpretation and a mistake claim concerning liability for sewer damage. The court allowed the appeal, remitting the case for trial.

1.7 Decision Date

8 April 2014

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
Olivine Capital Pte Ltd	Appellant	Corporation	Appeal Allowed	Won	James Leslie Ponniah of Malkin & Maxwell LLP Vincent Yeoh of Malkin & Maxwell LLP
Ong Puay Guan @ Steven Ong	Appellant	Individual	Appeal Allowed	Won	James Leslie Ponniah of Malkin & Maxwell LLP Vincent Yeoh of Malkin & Maxwell LLP
Chia Chin Yan	Respondent	Individual	Appeal Dismissed	Lost	Daniel Chia of Stamford Law Corporation Loh Jien Li of Stamford Law Corporation

3. Judges

Judge Name	Title	Delivered Judgment
Chao Hick Tin	Justice of the Court of Appeal	No
Andrew Phang Boon Leong	Justice of the Court of Appeal	Yes
Quentin Loh	Judge	No

4. Counsels

Counsel Name	Organization
James Leslie Ponniah	Malkin & Maxwell LLP
Vincent Yeoh	Malkin & Maxwell LLP
Daniel Chia	Stamford Law Corporation
Loh Jien Li	Stamford Law Corporation

4. Facts

Olivine Capital was the leaseholder of land at 180–188 Rangoon Road.
Ong Puay Guan @ Steven Ong is the CEO and a director of Olivine Capital.
Chia Chin Yan was hired as the professional engineer in May 2006.
An underground sewer pipe was damaged during piling work in September 2007.
The Public Utilities Board invoiced the First Appellant $512,939.18 for repair costs.
The Respondent resigned and gave the Second Appellant a letter on 15 October 2009.
The Appellants filed Suit No 762 of 2012 against the Respondent and Lee.

5. Formal Citations

Olivine Capital Pte Ltd and another v Chia Chin Yan and another matter, Civil Appeal No 86 of 2013 and Summons No 6101 of 2013, [2014] SGCA 19
Olivine Capital Pte Ltd and another v Lee Chiew Leong and another, , [2013] SGHC 168

6. Timeline

Date	Event
2006-05-01	Chia Chin Yan hired as professional engineer for redevelopment project.
2007-09-01	Underground sewer pipe damaged during piling work.
2007-12-24	Public Utilities Board gave notice to repair damaged sewer.
2007-12-31	Appellants agreed to bear the cost of PUB repairing the sewer.
2008-01-16	PUB informed Appellants that estimated repair cost would be $600,000.
2008-01-17	Appellants informed Respondent, Lee, and piling contractor that they were holding them liable for repair costs.
2008-04-28	PUB invoiced First Appellant $512,939.18.
2009-06-01	First Appellant appointed HPC Builders Pte Ltd as second builder; Respondent took on additional roles of architect and project coordinator.
2009-07-16	Respondent charged with an offence under s 14(1) of the Sewerage and Drainage Act.
2009-10-15	Respondent resigned and gave the Second Appellant the Compromise Letter.
2012-03-09	PUB charged the Second Appellant and Lee with offences under ss 14 and 20 of the Act; Respondent also charged with an additional offence under s 20.
2012-09-11	Appellants filed Suit No 762 of 2012 against the Respondent and Lee.
2013-02-01	Respondent filed SUM 608/2013 seeking a determination under O 14 r 12 of the Rules of Court.
2014-04-09	Court of Appeal allowed the appeal.

7. Legal Issues

Interpretation of Contract
- Outcome: The court found the compromise letter to be latently ambiguous and that its interpretation was not suitable for summary determination.
- Category: Substantive
- Sub-Issues:
  - Ambiguity in contract language
  - Conjunctive vs. disjunctive interpretation
- Related Cases:
  - [2008] 3 SLR(R) 1029
  - [2013] 4 SLR 193
Mistake
- Outcome: The court held that the issue of whether the Compromise Letter was void or voidable on the ground of mistake was not suitable for an O 14 r 12 determination.
- Category: Substantive
- Sub-Issues:
  - Common mistake
  - Unilateral mistake
- Related Cases:
  - [1989] 1 WLR 255
  - [2003] QB 679
  - [1950] 1 KB 671
  - [2005] 1 SLR(R) 502
Summary Judgment
- Outcome: The court determined that the matter was not suitable for summary determination under Order 14 rule 12.
- Category: Procedural
- Sub-Issues:
  - Suitability of Order 14 rule 12 determination
  - Binding effect of pleadings
- Related Cases:
  - [1989] 1 MLJ 321
  - [2010] 1 SLR 1129
  - [2008] 2 SLR(R) 786
  - [2008] 2 SLR(R) 981
  - [2011] 3 SLR 756

8. Remedies Sought

Indemnity for compensation payable to the PUB

9. Cause of Actions

Negligence
Breach of Contract

10. Practice Areas

Commercial Litigation
Construction Law

11. Industries

Construction

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
Olivine Capital Pte Ltd and another v Lee Chiew Leong and another	High Court	Yes	[2013] SGHC 168	Singapore	The judgment under appeal was the decision of the High Court which dismissed the Registrar's Appeal. The Court of Appeal overturned this decision.
Lin Securities (Pte) v Noone & Co Sdn Bhd (Klang Jaya Bahru Development Bhd, Third Party)	Malaysian High Court	Yes	[1989] 1 MLJ 321	Malaysia	Cited for the principle that a defendant is not bound by pleadings in Order 14 proceedings, but this principle was re-evaluated in light of amendments to the Singapore Rules of Court.
Poh Soon Kiat v Desert Palace Inc (trading as Caesars Palace)	Court of Appeal	Yes	[2010] 1 SLR 1129	Singapore	Cited as endorsing the principle in Lin Securities that a defendant is not bound by pleadings in summary judgment proceedings, but this was reconsidered in the present judgment.
Lim Leong Huat v Chip Hup Hup Kee Construction Pte Ltd	High Court	Yes	[2008] 2 SLR(R) 786	Singapore	Cited for the view that a defendant should be bound by pleadings during an Order 14 determination, challenging the principle in Lin Securities.
HSBC Institutional Trust Services (Singapore) Ltd v Elchemi Assets Pte Ltd and another	High Court	Yes	[2010] SGHC 67	Singapore	Cited as reaffirming the views expressed in Lim Leong Huat that a defendant is not entitled to raise fresh allegations not found in the defence without amending the defence.
United States Trading Co Pte Ltd v Ting Boon Aun and another	High Court	Yes	[2008] 2 SLR(R) 981	Singapore	Cited for expressing a similar view to Lim Leong Huat, that a defendant should set out all defenses in the defense so the plaintiff can properly assess the chances of a summary judgment application being successful.
Rankine Bernadette Adeline v Chenet Finance Ltd	High Court	Yes	[2011] 3 SLR 756	Singapore	Cited for considering all the decisions related to whether a defendant is bound by pleadings during an Order 14 determination.
Payna Chettiar v Maimoon bte Ismail and others	Singapore High Court	Yes	[1997] 1 SLR(R) 738	Singapore	Cited for the principles governing an Order 14 rule 12 application.
Barang Barang Pte Ltd v Boey Ng San and others	Singapore High Court	Yes	[2002] 1 SLR(R) 949	Singapore	Cited for the principle that the construction of law or document must be achievable without a full trial and must fully determine the entire cause or matter.
Re CEP Instruments Pte Ltd (in liquidation)	Singapore High Court	Yes	[2004] SGHC 206	Singapore	Cited for the caveat that invoking Order 14 rule 12 is not appropriate where factual disputes would affect the point of construction.
ANB v ANF	Singapore High Court	Yes	[2011] 2 SLR 1	Singapore	Cited for the caveat that invoking Order 14 rule 12 is not appropriate where factual disputes would affect the point of construction.
Zurich Insurance (Singapore) Pte Ltd v B-Gold Interior Design & Construction Pte Ltd	Court of Appeal	Yes	[2008] 3 SLR(R) 1029	Singapore	Cited for the principle that courts must ensure extrinsic evidence is only employed to illuminate contractual language and not to contradict or vary it.
Sembcorp Marine Ltd v PPL Holdings Pte Ltd and another and another appeal	Court of Appeal	Yes	[2013] 4 SLR 193	Singapore	Cited for the principle that courts must ensure extrinsic evidence is only employed to illuminate contractual language and not to contradict or vary it.
Ketteman and others v Hansel Properties Ltd and others	House of Lords	Yes	[1987] 1 AC 189	England	Cited for the principle that allowing an amendment before trial is different from allowing it at the end of trial to give an unsuccessful defendant an opportunity to renew the fight based on an entirely different defence.
Review Publishing Co Ltd and another v Lee Hsien Loong and another appeal	Court of Appeal	Yes	[2010] 1 SLR 52	Singapore	Cited for the guiding principle that amendments to pleadings ought to be allowed if they would enable the real question and/or issue in controversy between the parties to be determined.
Associated Japanese Bank (International) Ltd v Credit du Nord SA	English High Court	Yes	[1989] 1 WLR 255	England	Cited for setting out important propositions regarding common mistake at common law.
Great Peace Shipping Ltd v Tsavliris Salvage (International) Ltd	English Court of Appeal	Yes	[2003] QB 679	England	Cited for setting out the elements that must be satisfied before a court will find a common mistake sufficient to avoid a contract at common law.
Solle v Butcher	English Court of Appeal	Yes	[1950] 1 KB 671	England	Cited as the traditional source of the doctrine of common mistake in equity, but noted that this doctrine no longer exists under English law.
Chwee Kin Keong and others v Digilandmall.com Pte Ltd	Court of Appeal	Yes	[2005] 1 SLR(R) 502	Singapore	Cited as the leading decision establishing that there continues to be a doctrine of common mistake in equity in Singapore law.

13. Applicable Rules

Rule Name
Rules of Court (Cap 322, R 5, 2006 Rev Ed) O 14 r 12
Rules of Court O 20 r 5(1)

14. Applicable Statutes

Statute Name	Jurisdiction
Sewerage and Drainage Act (Cap 294, 2001 Rev Ed) s 14(1)	Singapore
Sewerage and Drainage Act (Cap 294, 2001 Rev Ed) ss 14 and 20	Singapore
Sewerage and Drainage Act (Cap 294, 2001 Rev Ed) s 20	Singapore

15. Key Terms and Keywords

15.1 Key Terms

Compromise Letter
Qualified Person
Sewer Damage
Order 14 rule 12
Pleadings
Common Mistake
Unilateral Mistake

15.2 Keywords

contract interpretation
mistake
sewer damage
summary judgment
pleadings
construction
negligence

17. Areas of Law

Area Name	Relevance Score
Contract Law	75
Civil Procedure	60
Commercial Disputes	50
Mistake	40
Estoppel	30
Professional Negligence	25
Construction Law	20

16. Subjects

Contract Law
Civil Procedure
Construction Law
Mistake