Fairview v Ong & Ong: Architectural Services Dispute & Wrongful Termination
In Civil Appeals Nos 51 and 52 of 2013, the Court of Appeal of Singapore heard appeals by Fairview Developments Pte Ltd and Ong & Ong Pte Ltd (OOPL) concerning a dispute over architectural services provided by OOPL and its predecessor, Ong & Ong Architects (OOA), for the development of Lot 248. The court dismissed Fairview's appeal and allowed OOPL's appeal, finding that Fairview had wrongfully terminated the 1983 Agreement and that OOPL was entitled to fees for the Later Abortive Works calculated on a percentage basis.
1. Case Overview
1.1 Court
Court of Appeal1.2 Outcome
Fairview's appeal dismissed; Ong & Ong's appeal allowed.
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Fairview Developments' appeal dismissed, Ong & Ong's appeal allowed. The case concerns a dispute over architectural services and wrongful termination.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Fairview Developments Pte Ltd | Appellant, Respondent | Corporation | Appeal Dismissed | Lost | Hri Kumar Nair, Shivani Retnam, Harsharan Kaur Bhullar, Yap Neng Boo Jimmy |
| Ong & Ong Pte Ltd | Respondent, Appellant | Corporation | Appeal Allowed | Won | Mohan Reviendran Pillay, Joanna Seetoh Wai Lin, Ang Wee Jian |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Chao Hick Tin | Justice of the Court of Appeal | Yes |
| Andrew Phang Boon Leong | Justice of the Court of Appeal | Yes |
| V K Rajah | Justice of the Court of Appeal | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Hri Kumar Nair | Drew & Napier LLC |
| Shivani Retnam | Drew & Napier LLC |
| Harsharan Kaur Bhullar | Drew & Napier LLC |
| Yap Neng Boo Jimmy | Jimmy Yap & Co |
| Mohan Reviendran Pillay | MPillay |
| Joanna Seetoh Wai Lin | MPillay |
| Ang Wee Jian | MPillay |
4. Facts
- Fairview engaged OOA in 1972 to develop Lot 248 as a condominium.
- In-principle approval was obtained in 1980.
- Fairview decided to develop Lot 248 in phases due to high development charges in 1981.
- OOPL claimed for loss of profits due to wrongful termination and fees for abortive works.
- Fairview terminated OOPL's services on 1 October 2009.
- OOA sent a letter to Fairview regarding OOPL’s succession of OOA.
5. Formal Citations
- Fairview Developments Pte Ltd v Ong & Ong Pte Ltd, Civil Appeals Nos 51 and 52 of 2013, [2014] SGCA 5
6. Timeline
| Date | Event |
|---|---|
| Fairview engaged OOA to apply for planning approval to develop Lot 248. | |
| In-principle approval for the development was obtained. | |
| Fairview confirmed change of plans to OOA to develop Lot 248 in phases. | |
| Fairview sent a letter to OOA regarding the reduction of fees. | |
| OOA replied to Fairview regarding fees. | |
| Phase 1 of the development was completed. | |
| OSM wrote to Fairview regarding the agreement reached on fees for the site. | |
| Mr. Ong Tze Boon joined OOA. | |
| Phase 2 of the development was completed. | |
| OOA wrote to Fairview regarding professional fees for the entire development site. | |
| Fairview confirmed acceptance of the terms outlined in OOA's letter. | |
| OTC and OTB sent a letter to Fairview regarding OOPL’s succession of OOA. | |
| TTL and YLH replied on behalf of Fairview that it had no objection to OOA’s plan to let OOPL succeed OOA. | |
| The main Phase 3 was completed. | |
| Phase 3a was completed. | |
| Phase 3b was completed. | |
| Fairview wrote to OOPL to terminate its services. | |
| Fairview replied declining to meet OOPL and reiterated its request for the LR. | |
| Fairview repeated its requests for OOPL’s invoice as well as the LR. | |
| Fairview repeated its requests for OOPL’s invoice as well as the LR. | |
| Fairview sent a Letter of Demand to OOPL copied to the Board of Architects. | |
| OOPL gave its commitment to submit its claims by end April 2010. | |
| Fairview stated that it did not know that there were still outstanding fees. | |
| OOPL estimated that Fairview owed it $6,512,158.80 in loss of profits and $9.888 million in professional fees. | |
| Fairview denied that OOPL was entitled to claim for loss of profits. | |
| The BOA wrote to the parties fixing the security at $3.3 million. | |
| The BOA confirmed receipt of a banker’s guarantee for this sum. | |
| OOPL issued the LR. | |
| Suit No 369 of 2011 was filed. | |
| Civil Appeal No 51 of 2013 and Civil Appeal No 52 of 2013 were brought. | |
| The Court of Appeal dismissed Fairview’s appeal in CA 51 and allowed OOPL’s cross-appeal in CA 52. |
7. Legal Issues
- Wrongful Termination
- Outcome: The court found that Fairview wrongfully terminated the 1983 Agreement.
- Category: Substantive
- Sub-Issues:
- Breach of contract
- Failure to provide reasonable notice
- Novation
- Outcome: The court found that the 1983 Agreement had been novated to OOPL.
- Category: Substantive
- Quantum Meruit
- Outcome: The court rejected the quantum meruit basis for calculating fees for the Later Abortive Works, instead opting for a percentage basis.
- Category: Substantive
- Limitation of Actions
- Outcome: The court found that the claim had not been time-barred.
- Category: Procedural
- Sub-Issues:
- Acknowledgment of debt
- Accrual of cause of action
8. Remedies Sought
- Loss of Profits
- Professional Fees
9. Cause of Actions
- Breach of Contract
- Wrongful Termination
10. Practice Areas
- Commercial Litigation
- Construction Law
11. Industries
- Construction
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| PT Bakrie Investindo v Global Distressed Alpha Fund 1 Limited Partnership | Court of Appeal | Yes | [2013] 4 SLR 1116 | Singapore | Cited to contrast the clarity of the contract's text and context in this case with a case where they were unclear. |
| Chwee Kin Keong and others v Digilandmall.com Pte Ltd | High Court | Yes | [2004] 2 SLR(R) 594 | Singapore | Cited for the principle that very little is required to find sufficient consideration in law. |
| Chwee Kin Keong and others v Digilandmall.com Pte Ltd | Court of Appeal | Yes | [2005] 1 SLR(R) 502 | Singapore | Affirmed the High Court's decision regarding consideration, though without specific discussion of that point. |
| Sunny Metal & Engineering Pte Ltd v Ng Khim Ming Eric (practising under the name and style of WP Architects) | High Court | Yes | [2007] 1 SLR(R) 853 | Singapore | Cited for the principle that very little is required to find sufficient consideration in law. |
| Sunny Metal & Engineering Pte Ltd v Ng Khim Ming Eric | Court of Appeal | Yes | [2007] 3 SLR(R) 782 | Singapore | Reversed the High Court's decision, but without discussion of the point regarding consideration. |
| Gay Choon Ing v Loh Sze Ti Terence Peter and another appeal | Court of Appeal | Yes | [2009] 2 SLR(R) 332 | Singapore | Cited for the principle that very little is required to find sufficient consideration in law. |
| Rainforest Trading Ltd and another v State Bank of India Singapore | Court of Appeal | Yes | [2012] 2 SLR 713 | Singapore | Cited for the principle that courts are reluctant to invalidate commercial transactions on technical bases like consideration. |
| Benjamin Scarf v Alfred George Jardine | House of Lords | Yes | (1882) 7 App Cas 345 | United Kingdom | Cited for the definition of novation and the nature of consideration in a novation agreement. |
| Chung Meng Soon and Others v Lee Kai Investment (Pte) Ltd | High Court | Yes | [1993] SGHC 26 | Singapore | Cited by Fairview for the proposition that the standard conditions of the Singapore Institute of Architects apply to an employer's engagement of an architect. |
| Chuan & Company Pte Ltd v Ong Soon Huat | Court of Appeal | Yes | [2003] 2 SLR(R) 205 | Singapore | Cited for the requirements to constitute a valid acknowledgment of debt under the Limitation Act. |
| Kim Eng Securities Pte Ltd v Tan Suan Khee | High Court | Yes | [2007] 3 SLR(R) 195 | Singapore | Cited for a summary of the legal principles governing what constitutes a valid acknowledgment within the meaning of s 26(2) of the Limitation Act. |
| Dwr Cymru (Welsh Water) v Carmarthenshire County Council | English High Court | Yes | [2004] EWHC 2991 | United Kingdom | Cited by Fairview for the proposition that the restarting of the limitation clock was intended to apply only when the acknowledgment was made before the expiry of the limitation period. |
| In re Gee & Co (Woolwich) Ltd | English Court | Yes | [1975] 1 Ch 52 | United Kingdom | English decision that interpreted s 23(4) of the UK Limitation Act 1939 as permitting acknowledgments made both before and after the expiry of the limitation period to restart the limitation clock. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Limitation Act | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Abortive Works
- Novation
- Letter of Release
- 1983 Agreement
- Quantum Meruit
- Limitation Act
- Architectural Services
- Succession Letter
15.2 Keywords
- Contract
- Construction
- Architecture
- Termination
- Limitation
- Singapore
16. Subjects
- Contract Law
- Construction Law
- Architectural Services
- Limitation of Actions
17. Areas of Law
- Contract Law
- Architectural Services
- Limitation of Actions
- Building and Construction Law