Ong & Ong v Fairview Developments: Offer to Settle & Contract Law

In Ong & Ong Pte Ltd v Fairview Developments Private Limited, the High Court of Singapore addressed the validity of the defendant's acceptance of the plaintiff's offer to settle. The plaintiff, Ong & Ong, sued Fairview Developments for $10,138,128.28, comprising loss of prospective fees and fees for architectural work. Fairview Developments counterclaimed for $23,410,000. The plaintiff offered to settle for $2,588,666 on 28 July 2011. The defendant purported to accept this offer on 24 September 2013, after the Court of Appeal heard appeals on the liability issue. Justice Lee Seiu Kin held that the offer to settle had not expired and was validly accepted, granting the defendant's application for a declaration to that effect.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Declaration granted that the defendant's acceptance of the plaintiff's offer to settle was valid.

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

High Court case regarding the validity of an offer to settle. The court held that the offer was validly accepted by the defendant.

1.7 Decision Date

17 March 2014

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
Ong & Ong Pte Ltd	Plaintiff	Corporation	Application granted	Won	Ang Wee Jian of MPillay Mohan Pillay of MPillay
Fairview Developments Private Limited	Defendant	Corporation	Application granted	Won	Jimmy Yap of Jimmy Yap & Co Hri Kumar Nair of Drew & Napier LLC

3. Judges

Judge Name	Title	Delivered Judgment
Lee Seiu Kin	Judge	Yes

4. Counsels

Counsel Name	Organization
Ang Wee Jian	MPillay
Mohan Pillay	MPillay
Jimmy Yap	Jimmy Yap & Co
Hri Kumar Nair	Drew & Napier LLC

4. Facts

Plaintiff claimed $10,138,128.28 from the defendant for loss of prospective fees and fees for architectural work.
Defendant counterclaimed for $23,410,000 for losses due to the plaintiff's delay in providing a letter of release.
Plaintiff offered to settle for $2,588,666 on 28 July 2011.
The offer to settle did not specify a time for acceptance.
The defendant purported to accept the offer on 24 September 2013, after appeals on the liability issue.
The defendant did not appeal the dismissal of its counterclaim.
The plaintiff argued the offer was no longer capable of acceptance as the counterclaim had been dismissed.

5. Formal Citations

Ong & Ong Pte Ltd v Fairview Developments Private Limited, Suit No 369 of 2011 (Summons No 5235 of 2013), [2014] SGHC 48

6. Timeline

Date	Event
2011-05-20	Action commenced by the plaintiff
2011-07-28	Plaintiff's solicitors sent an offer to settle to the defendant's solicitors
2012-03-07	Court granted application for bifurcation of the suit
2012-10-01	Trial on liability was heard
2013-03-26	Decision issued, allowing part of the plaintiff’s claim and dismissing the rest, and dismissing the defendant’s counterclaim
2013-04-22	Defendant's solicitors wrote to plaintiff's solicitors to ask if the plaintiff was prepared to accept the outcome of the matter without taking the matter further to the Court of Appeal
2013-04-23	Plaintiff's solicitors replied that the offer to settle remained open for acceptance
2013-04-25	Both parties filed notices of appeal
2013-09-24	Court of Appeal heard the appeals; defendant sent notice of acceptance of plaintiff's offer to settle
2013-11-05	Order made in terms of the application and granted costs to the defendants
2013-12-02	Plaintiff filed the appeal
2014-03-18	Grounds of decision given

7. Legal Issues

Validity of Acceptance of Offer to Settle
- Outcome: The court held that the offer to settle had not expired and was validly accepted by the defendant.
- Category: Substantive
- Sub-Issues:
  - Mirror image rule
  - Contra proferentem rule
- Related Cases:
  - [1996] SGHC 300
  - [2011] SGDC 15
  - 53 OR (2d) 732; 1986 CanLII 2663

8. Remedies Sought

Monetary Damages
Declaration

9. Cause of Actions

Breach of Contract

10. Practice Areas

Commercial Litigation

11. Industries

Construction

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
Fuyawa Enterprise Pte Ltd v Lim Han Tee trading as Wifu Marketing	High Court	Yes	[1996] SGHC 300	Singapore	Cited for the proposition that an offeree’s acceptance must mirror the terms of the offer to settle.
Ip Yun Ha v Dennis Wee Realty Pte Ltd	District Court	Yes	[2011] SGDC 15	Singapore	Cited for the proposition that an acceptance must be done without any amendment or variation and must be unqualified and unconditional.
Re Desanto et al v Cretzman et al	District Court of Ontario	Yes	53 OR (2d) 732; 1986 CanLII 2663	Canada	Cited for the proposition that an acceptance must be done without any amendment or variation and must be unqualified and unconditional.
The “Endurance 1”	Singapore Court of Appeal	Yes	[1998] 3 SLR(R) 970	Singapore	Cited for the proposition that the purpose of the offer to settle regime was to encourage the termination of litigation by agreement of the parties.
Data General (Canada) Ltd v Molnar Systems Group Inc and Corporation of the Town of Lindsay	Ontario Court of Appeal	Yes	(1991) 85 DLR (4th) 392	Canada	Cited for the proposition that the purpose of the offer to settle regime was to encourage the termination of litigation by agreement of the parties.
Singapore Airlines Ltd v Tan Shwu Leng	Singapore Court of Appeal	Yes	[2001] 3 SLR(R) 439	Singapore	Cited for the object of the offer to settle regime was to spur the parties to bring litigation to an expeditious end without judgment, and thus to save costs and judicial time.
Calderbank v Calderbank	English Court of Appeal	Yes	[1976] Fam 93 (CA)	England and Wales	Concerns divorce proceedings in England in which the wife sought a declaration that she was the sole beneficial owner of the matrimonial home which she had paid for but was held in the husband’s name.
Cutts v Head and another	English Court of Appeal	Yes	[1984] 1 Ch 290	England and Wales	Considered the authorities and held that the Calderbank offer was not restricted to matrimonial proceedings.
Shi Fang v Koh Pee Huat	High Court	Yes	[1996] 1 SLR(R) 906	Singapore	If the outcome was less favourable than a Calderbank offer, the letter would be shown to the court and taken into consideration on the question of costs.
SBS Transit Ltd (formerly known as Singapore Bus Services Limited) v Koh Swee Ann	Singapore Court of Appeal	Yes	[2004] 3 SLR(R) 365	Singapore	A Calderbank offer, unlike the statutory regime under O 22 and O 22A of the ROC, does not bind the court to award costs in any particular manner but is one factor that the court will take into consideration in the exercise of its discretion to award costs.
Lie Djioe Boei alias Lee Yew Wee Executor of the Estate of Lioe Soei Tjin alias Liu Swee Chin (or Lie Soei Tjin also known as Liu Swee Chin, deceased) v Huang Han Jiang (alias Huang Han Jiang)	High Court	Yes	[2000] SGHC 107	Singapore	The defendant made a Calderbank offer near the end of the trial. It was rejected by the plaintiff. The judgment resulted in an outcome that was substantially similar to the offer and much lower than the plaintiff’s claim.
Colgate Palmolive Ltd and another v Markwell Finance and another	England and Wales High Court	Yes	[1990] RPC 197	England and Wales	The circumstances of the defendants’ Calderbank offer was such that it would be inappropriate to deprive the plaintiffs of any part of their costs of the action.
Butcher v Wolfe and another	Family Court of Australia	Yes	[1999] 2 FCR 165	Australia	The plaintiff was ordered to pay all the costs of the action. The defendant made a Calderbank offer to buy out the plaintiff’s interest in the land on a tenanted basis.
Jet Holding Ltd and Others v Cooper Cameron (Singapore) Pte Ltd and Another	High Court	Yes	[2006] SGHC 20	Singapore	The “Calderbank letter is only available to a party who could not have protected his position by payment into court”
Man B&W Diesel S E Asia Pte Ltd and another v PT Bumi International Tankers and another appeal	Singapore Court of Appeal	Yes	[2004] 3 SLR(R) 267	Singapore	In which the Court of Appeal held that the appellants were not entitled to indemnity costs because their offer to settle (which was valid only for 14 days) had expired before the disposal of the claim.
Maitland Hospital v Fisher (No 2)	New South Wales Court of Appeal	Yes	(1992) 27 NSWLR 721	Australia	Held that the obvious purpose of legislating cost consequences (with respect to the failure to accept a reasonable offer to settle) was to facilitate the proper compromise of litigation by equal measures of a “carrot” and “stick”.
FSM v Clarke et al	British Columbia Supreme Court	Yes	FSM v Clarke et al [2000] BCSC 96	Canada	The policy articulated in r 57 was to “[reward] parties who offer to settle”
Jacuzzi Canada Ltd v A Mantella & Sons Ltd et al	Ontario High Court of Justice	Yes	Jacuzzi Canada Ltd v A Mantella & Sons Ltd et al (1988) 31 CPC (2d) 195	Canada	Recognised that the intent of the r 49.10 was to induce settlement and avoid trials, it took the view that tinkering with its prima facie operation would destroy the predictability necessary for r 49.10 to accomplish its purpose.
Niagara Structural Steel (St Catharines) Ltd v WD LaFlamme Ltd	Ontario Court of Appeal	Yes	Niagara Structural Steel (St Catharines) Ltd v WD LaFlamme Ltd (1987) 19 CPC (2d) 163	Canada	The general, or basic, rule contained in r. 49.10(1) is intended to be an incentive to the settlement of litigation.
Mutual Community Ltd v Lorden Holdings Pty Ltd and others	Supreme Court of Victoria	Yes	Mutual Community Ltd v Lorden Holdings Pty Ltd and others (unreported, SC (Vic), No 10561/90, 28 April 1993, BC9303878)	Australia	Identified the Court’s policy “to encourage litigating parties to undertake genuine settlement negotiations and, for the purpose, to face up to serious offers of settlement”
Chrulew and others v Borm-Reid & Co	England and Wales High Court	Yes	Chrulew and others v Borm-Reid & Co [1992] 1 WLR 176	England and Wales	Generally, the court’s consideration will bear on reasonableness or otherwise of an offeree’s refusal to accept the Calderbank offer

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute Name	Jurisdiction
Rules of Court (Cap 322, R5, 2006 Rev Ed)	Singapore

15. Key Terms and Keywords

15.1 Key Terms

Offer to Settle
Acceptance
Counterclaim
Indemnity Costs
Contra Proferentem
Mirror Image Rule

15.2 Keywords

offer to settle
contract law
settlement
civil procedure
Singapore
High Court

17. Areas of Law

Area Name	Relevance Score
Costs	80
Civil Procedure	70
Contract Law	60

16. Subjects

Contract Law
Civil Procedure
Settlement Agreements