Corinna Chin v Hewlett-Packard: Incentive Compensation Dispute over NETS Contract

In the Singapore High Court case of Corinna Chin Shu Hwa v Hewlett-Packard Singapore (Sales) Pte Ltd, Corinna Chin, a former sales product specialist, sued Hewlett-Packard for outstanding incentive compensation related to a $5.38 million contract with Network for Electronic Transfers (NETS) and for allegedly underpaid final incentive pay after she was retrenched. The court ruled in favor of Corinna Chin, finding that the NETS contract qualified as new business under the New Business Metric (NBM) and that her final incentive pay should have been calculated on a pro-rated basis.

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

Singapore High Court case involving Corinna Chin and Hewlett-Packard concerning incentive compensation for a NETS contract and pro-rated incentive pay. The court ruled in favor of Corinna Chin.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
HEWLETT-PACKARD SINGAPORE (SALES) PTE LTDDefendantCorporationJudgment against DefendantLost
CORINNA CHIN SHU HWAPlaintiffIndividualJudgment for PlaintiffWon

3. Judges

Judge NameTitleDelivered Judgment
Edmund LeowJudicial CommissionerYes

4. Counsels

Counsel NameOrganization
Pradeep NairRajah & Tann LLP
Gregory VijayendranRajah & Tann LLP
Lester ChuaRajah & Tann LLP
Geraldine SoonKhattarWong LLP
PE AshokanKhattarWong LLP

4. Facts

  1. Corinna Chin was a sales product specialist with Hewlett-Packard from January 2005 until June 2012.
  2. Corinna claimed $627,369.54 from HP, including $584,613.19 for outstanding incentive compensation from a NETS contract.
  3. HP introduced a new performance metric, the New Business Metric (NBM), for the financial year 2012.
  4. NETS had been using HP's Tandem servers but decided in late 2010 to buy IBM servers.
  5. HP refused to extend maintenance services for the existing servers unless NETS signed a new contract with HP.
  6. NETS decided to discontinue the planned migration from the old HP platform to the new IBM platform around December 2011.
  7. HP concluded the NETS contract on 21 March 2012, when NETS issued a purchase order for the new HP servers, worth about $5.38m.
  8. Corinna was retrenched on 18 June 2012, before the end of the financial year.

5. Formal Citations

  1. Corinna Chin Shu Hwa v Hewlett-Packard Singapore (Sales) Pte Ltd, Suit No 918 of 2012, [2015] SGHC 204
  2. Corinna Chin Shu Hwa v Hewlett-Packard Singapore (Sales) Pte Ltd, Civil Appeal No 109 of 2015, [2016] SGCA 19

6. Timeline

DateEvent
Corinna Chin joined Hewlett-Packard
NETS decided to buy IBM servers
NETS took delivery of the IBM servers
Financial year 2012 started
Corinna and colleagues met NETS representatives to discuss migrating to new HP servers
Annual Sales Kick-Off event took place
Maintenance contract for existing HP servers expiring
NETS decided to discontinue planned migration from old HP platform to new IBM platform
Corinna emailed Julie Shaw and Sandeep Kapoor regarding NETS deal as new business
Corinna sent NETS a finalised quotation
HP concluded the NETS contract
Corinna filed her claim under the NBM
Corinna lodged a complaint with HP’s corporate compliance department
Corinna was retrenched
New HP system went live
Court decided in Corinna's favour on both claims
Decision Date

7. Legal Issues

  1. Breach of Contract
    • Outcome: The court found that Hewlett-Packard breached the employment contract by failing to properly calculate and pay Corinna Chin's incentive compensation.
    • Category: Substantive
    • Sub-Issues:
      • Failure to pay incentive compensation
      • Improper calculation of incentive pay
  2. Contractual Interpretation
    • Outcome: The court found that the term 'new end user customer' was ambiguous and applied the contra proferentem rule against Hewlett-Packard, the drafter of the contract.
    • Category: Substantive
    • Sub-Issues:
      • Ambiguity in contract terms
      • Application of contra proferentem rule

8. Remedies Sought

  1. Monetary Damages

9. Cause of Actions

  • Breach of Contract

10. Practice Areas

  • Commercial Litigation
  • Employment Disputes

11. Industries

  • Technology

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Investors Compensation Scheme Ltd v West Bromwich Building SocietyHouse of LordsYes[1998] 1 WLR 896England and WalesCited for the principle of contractual interpretation, stating that the interpretation process involves ascribing to the words that meaning which the parties, using those words against the relevant background, would have reasonably understood them to mean.
Zurich Insurance (Singapore) Pte Ltd v B-Gold Interior Design & Construction Pte LtdCourt of AppealYes[2008] 3 SLR(R) 1029SingaporeApproved the contextual approach to contractual interpretation and the admissibility of extrinsic evidence.
Smile Inc Dental Surgeons Pte Ltd v Lui Andrew StewartCourt of AppealYes[2012] 4 SLR 308SingaporeCited regarding the need for a clear and obvious context when using extrinsic evidence in contractual interpretation.
Sembcorp Marine Ltd v PPL Holdings Pte LtdCourt of AppealYes[2013] 4 SLR 193SingaporeCited for the principle that evidence of the circumstances surrounding the contract enables the court to consider the facts and circumstances which were in the mind of the drafter when he used those words.
Co-operators Life Insurance Co v GibbensSupreme Court of CanadaYes(2009) SCC 59CanadaCited for the principle that whoever holds the pen creates the ambiguity and must live with the consequences.
McGeown v Direct Travel InsuranceCourt of AppealYes[2004] 1 All ER (Comm) 609England and WalesCited for the principle that a court should be wary of starting its analysis by finding an ambiguity by reference to the words in question looked at on their own.
LTT Global Consultants v BMC Academy Pte LtdHigh CourtYes[2011] 3 SLR 903SingaporeCited for the principle that the contra proferentem principle cannot apply to create an ambiguity where one does not exist.
Waltons Stores (Interstate) Ltd v MaherHigh Court of AustraliaYes(1988) 164 CLR 387AustraliaCited regarding promissory estoppel.
J Spurling Ltd v BradshawCourt of AppealYes[1956] 1 WLR 461England and WalesCited for the principle that the more unreasonable a clause is, the greater the notice which must be given of it.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
Civil Law ActSingapore

15. Key Terms and Keywords

15.1 Key Terms

  • Incentive Compensation
  • New Business Metric
  • NETS Contract
  • Pro-rated Incentive Pay
  • Technology Refresh
  • Win Back Account
  • Contra Proferentem

15.2 Keywords

  • Incentive Compensation
  • New Business Metric
  • NETS Contract
  • Pro-rating
  • Employment
  • Hewlett-Packard
  • Corinna Chin

17. Areas of Law

Area NameRelevance Score
Breach of Contract70
Contract Law70
Employment Law60
Incentive Compensation50
Measure of Damages30
Wrongful Termination20

16. Subjects

  • Contract Dispute
  • Employment Dispute
  • Incentive Compensation
  • Contractual Interpretation