Hyundai Engineering v International Elements: Interpretation of s 15(3)(b) of Building and Construction Industry Security of Payment Act
Hyundai Engineering & Construction Co Ltd, the plaintiff, sought to set aside an adjudication determination in favor of International Elements Pte Ltd, the defendant, concerning a payment claim under a supply contract. The High Court of Singapore, presided over by Kannan Ramesh JC, dismissed the originating summons, holding that reasons for non-payment under s 15(3)(b) of the Building and Construction Industry Security of Payment Act must be furnished in relation to a payment claim and that the adjudication application was properly filed. The court also addressed the release of security paid into court pending appeal.
1. Case Overview
1.1 Court
High Court of the Republic of Singapore1.2 Outcome
Originating Summons dismissed.
1.3 Case Type
Construction
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
The High Court held that reasons for non-payment under s 15(3)(b) of the SOP Act must be furnished in relation to a payment claim.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Hyundai Engineering & Construction Co Ltd | Plaintiff | Corporation | Claim Dismissed | Lost | Christopher Wong, Chew Wei Jie |
| International Elements Pte Ltd | Defendant | Corporation | Counterclaim Allowed | Won | Raymond Chan |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Kannan Ramesh | Judicial Commissioner | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Christopher Wong | cLegal LLC |
| Chew Wei Jie | cLegal LLC |
| Raymond Chan | Chan Neo LLP |
4. Facts
- The plaintiff was the main contractor for a construction project.
- The defendant was engaged as a subcontractor for the supply, delivery, and unloading of stone.
- The payment claim in dispute was Progress Claim No 24 (PC24), served on 20 November 2015.
- PC24 claimed $1,188,087.59, representing cumulative unpaid amounts from PC1 to PC23.
- The defendant received no payment or response regarding reasons for non-payment for PC24.
- The defendant served a Notice of Intention to Apply for Adjudication of PC24 on 22 January 2016.
- The adjudicator found in the defendant’s favor, awarding $974,823.95 plus adjudication costs.
5. Formal Citations
- Hyundai Engineering & Construction Co Ltd v International Elements Pte Ltd, Originating Summons No 204 of 2016, [2016] SGHC 132
6. Timeline
| Date | Event |
|---|---|
| Letter of Award dated | |
| Letter of Acceptance dated | |
| Progress Claim No 24 served by the defendant on the plaintiff | |
| Notice of Intention to Apply for Adjudication of PC24 served on the plaintiff | |
| Adjudication Application No 30 of 2015 lodged with the Singapore Mediation Centre | |
| Plaintiff filed its adjudication response | |
| Adjudication Determination dated | |
| Hearing date | |
| Hearing date | |
| Hearing date | |
| Judgment date |
7. Legal Issues
- Interpretation of s 15(3)(b) of the Building and Construction Industry Security of Payment Act
- Outcome: The court held that the reasons referred to in s 15(3)(b) must be furnished in relation to a payment claim before the 'relevant due date' and after the issuance of the payment claim.
- Category: Statutory Interpretation
- Whether AA30 was filed out of time or prematurely
- Outcome: The court held that AA30 was properly filed and not lodged prematurely or out of time.
- Category: Procedural
- Breach of Natural Justice
- Outcome: The court held that there was no breach of natural justice.
- Category: Procedural
- Related Cases:
- [2015] 1 SLR 797
- Interpretation of s 27(5) of the Building and Construction Industry Security of Payment Act
- Outcome: The court ordered that the money paid into court be released to the defendant, notwithstanding that the matter was still pending appeal.
- Category: Statutory Interpretation
8. Remedies Sought
- Setting aside of Adjudication Determination
9. Cause of Actions
- Statutory Adjudication under the Building and Construction Industry Security of Payment Act
10. Practice Areas
- Construction Litigation
- Commercial Litigation
- Arbitration
11. Industries
- Construction
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Citiwall Safety Glass Pte Ltd v Mansource Interior Pte Ltd | High Court | Yes | [2015] 1 SLR 797 | Singapore | Cited for the principle that a breach of s 16(3)(c) is a ground for setting aside an adjudication determination. |
| Eng Seng Precast Pte Ltd v SLF Construction Pte Ltd | High Court | No | [2015] 5 SLR 948 | Singapore | Cited to note that the Building and Construction Industry Security of Payment Act 1999 No 46 (NSW), on which the Act was based, draws no distinction between supply and construction contracts. |
| YTL Construction (S) Pte Ltd v Balanced Engineering & Construction Pte Ltd | High Court | Yes | [2014] SGHC 142 | Singapore | Cited for the principle that an adjudication application filed outside of the timeline would warrant the adjudication determination being set aside. |
| Newcon Builders Pte Ltd v Sino New Steel Pte Ltd | High Court | Yes | [2015] SGHC 226 | Singapore | Cited for the principle that an adjudication application filed prematurely is invalid and entitles the court to set aside an adjudication determination rendered pursuant to that application. |
| Global Distressed Alpha Fund I Ltd Partnership v PT Bakrie Investindo | High Court | No | [2013] 2 SLR 429 | Singapore | Cited regarding the interpretation of 'finally determined' in the context of the Rules of Court. |
| PT Bakrie Investindo v Global Distressed Alpha Fund 1 Ltd Partnership | Court of Appeal | No | [2013] 4 SLR 1116 | Singapore | Cited regarding the interpretation of 'finally determined' in the context of the Rules of Court. |
| Lau Fook Hoong Adam v GTH Engineering & Construction Pte Ltd | High Court | Yes | [2015] 4 SLR 615 | Singapore | Cited to discuss the purpose of s 27(5) of the Act. |
| W Y Steel Construction Pte Ltd v Osko Pte Ltd | Court of Appeal | Yes | [2013] 3 SLR 380 | Singapore | Cited in respect of the crucial role liquidity plays in the construction industry. |
| Choi Peng Kum and another v Tan Poh Eng Construction Pte Ltd | High Court | Yes | [2013] SGHC 272 | Singapore | Cited for interpreting s 27(5) in the same manner. |
| Shell Refining (Australia) Pty Limited v A J Mayr Pty Limited | Supreme Court of New South Wales | Yes | [2006] NSWSC 154 | New South Wales | Cited for the court's discretion to release the adjudicated amount paid into court notwithstanding that an appeal was pending. |
| W Y Steel Construction Pte Ltd v Osko Pte Ltd | High Court | No | [2012] SGHC 194 | Singapore | Cited as an example where the court ordered payment out of the sum paid into court unless the plaintiff appealed within time. |
13. Applicable Rules
| Rule Name |
|---|
| Rules of Court (Cap 322, r 5) |
| Rules of Court (Cap 322, R 5, 2014 Rev Ed) O 67 r 10(2) |
| Order 95, Rule 2 of the Rules of Court (Cap 322, r 5) |
| Order 95 r 3(3) of the Rules of Court |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Building and Construction Industry Security of Payment Act (Cap 30B) | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 2 | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 8 | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 8(3) | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 8(4) | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 10(4) | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 11(2) | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 12 | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 12(3) | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 12(3)(a) | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 12(5) | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 13(3)(a) | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 15(3) | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 15(3)(a) | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 15(3)(b) | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 16(3)(c) | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 17(1)(b) | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 27(5) | Singapore |
| Building and Construction Industry Security of Payment Act (Cap 30B) s 36 | Singapore |
| Reciprocal Enforcement of Foreign Judgments Act (Cap 265, 2001 Rev Ed) s 3(3) | Singapore |
| Reciprocal Enforcement of Foreign Judgments Act (Cap 265, 2001 Rev Ed) s 4(5) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Building and Construction Industry Security of Payment Act
- Supply Contract
- Cumulative Payment Claim
- Adjudication Determination
- Payment Claim
- Payment Response
- Relevant Due Date
- Natural Justice
- Security for Payment
15.2 Keywords
- Building and Construction Industry Security of Payment Act
- Construction Law
- Adjudication
- Payment Claim
- Supply Contract
16. Subjects
- Construction Dispute
- Arbitration
- Contract Law
- Security of Payment
17. Areas of Law
- Building and Construction Law
- Statutes and Regulations
- Construction Law
- Contract Law
- Civil Procedure
- Arbitration Law