Patsystems Pte Ltd v PT Bursa: Breach of Contract & Software License Dispute
In Patsystems Pte Ltd v PT Bursa Komoditi Dan Derivatif Indonesia, the High Court of Singapore ruled in favor of Patsystems, a Singaporean company, against PT Bursa, an Indonesian commodities exchange, for breach of a Software Licence & Support Agreement and Addendum. Patsystems sued for US$604,340.68 in unpaid invoices, while PT Bursa counterclaimed for breaches of contract and sought a refund of the license fee or damages. The court allowed Patsystems' claim and dismissed PT Bursa's counterclaim, finding no valid contractual variations or breaches by Patsystems.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Judgment for Plaintiff; Defendant's counterclaim dismissed.
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Singapore court case involving Patsystems and PT Bursa over a software license agreement, focusing on breach of contract and remedies.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Patsystems Pte Ltd | Plaintiff | Corporation | Judgment for Plaintiff | Won | |
| PT Bursa Komoditi Dan Derivatif Indonesia | Defendant | Corporation | Counterclaim Dismissed | Lost |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Mavis Chionh | Judicial Commissioner | Yes |
4. Counsels
4. Facts
- Patsystems and PT Bursa entered into a Software Licence & Support Agreement on 9 September 2009.
- PT Bursa paid a one-time license fee of US$1.5 million for a perpetual license to use Patsystems' software.
- The agreement included annual fees for System Support and Maintenance (S&M fees).
- PT Bursa began withholding S&M payments, claiming multiple problems with the software.
- Patsystems offered to replace the existing software with a new system called Global Trading Administration (GTA).
- PT Bursa claimed the parties agreed to contractual variations via email correspondence.
- Patsystems claimed the email correspondence represented ongoing discussions, not legally binding agreements.
5. Formal Citations
- Patsystems Pte Ltd v PT Bursa Komoditi Dan Derivatif Indonesia, Suit No 804 of 2016, [2019] SGHC 131
6. Timeline
| Date | Event |
|---|---|
| Software Licence & Support Agreement signed | |
| User Acceptance Testing signed off | |
| Soft launch of trading platform | |
| Official launch of trading platform | |
| Addendum to Licence Agreement signed | |
| Defendant paid first instalment of System Support and Maintenance payment | |
| Defendant issued Notice of Non-Compliance | |
| Plaintiff sent email regarding S&M payments and GTA system | |
| Plaintiff sent email regarding compromise on S&M payments | |
| Plaintiff's Regional Director sent email to CEO regarding S&M reduction | |
| Defendant sent email regarding S&M payments and GTA system | |
| Plaintiff met with Defendant in Jakarta to discuss outstanding S&M payments | |
| Plaintiff sent Defendant Powerpoint slides regarding contractual parameters and invoices | |
| Defendant invited Plaintiff to Jakarta to discuss outstanding issues | |
| Plaintiff notified Defendant of potential service suspension | |
| Defendant responded to Plaintiff's suspension notice | |
| Plaintiff notified Defendant of service suspension | |
| Defendant asserted agreement to pay only US$75,000 for S&M fees | |
| Defendant sent Plaintiff emails as proof of agreement | |
| Defendant made a single payment of US$75,000 | |
| Parties had tele-conversation regarding software issues | |
| Defendant sent Plaintiff a list of software issues | |
| Plaintiff issued Notice of Termination | |
| Plaintiff ceased providing support services | |
| Suit filed | |
| Trial began | |
| Court allowed Plaintiff's claim and dismissed Defendant's counterclaim | |
| Court granted Defendant's application to file notice of appeal out of time | |
| Defendant filed notice of appeal | |
| Reasons for decision set out |
7. Legal Issues
- Breach of Contract
- Outcome: The court found that the Defendant breached the contract by failing to pay the invoices.
- Category: Substantive
- Sub-Issues:
- Failure to pay invoices
- Failure to provide reasonably workable software system
- Contractual Variation
- Outcome: The court found that the alleged 'Arrangement' and 'Revised Arrangement' did not constitute valid contractual variations.
- Category: Substantive
- Sub-Issues:
- Validity of arrangement
- Validity of revised arrangement
- Consideration
- Promissory Estoppel
- Outcome: The court found that the Plaintiff did not make an unequivocal representation to forbear on insisting upon any legal entitlement it had to future System Support and Maintenance payments.
- Category: Substantive
- Sub-Issues:
- Unequivocal representation
- Reliance
- Inequity
- Failure of Consideration
- Outcome: The court found that the Defendant received benefit under the Licence Agreement and therefore there was no total failure of consideration.
- Category: Substantive
- Sub-Issues:
- Total failure of consideration
- Divisible contract
8. Remedies Sought
- Monetary Damages
- Refund of Licence Fee
9. Cause of Actions
- Breach of Contract
10. Practice Areas
- Commercial Litigation
- Contract Disputes
11. Industries
- Financial Technology
- Commodities Exchange
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Combe v Combe | English Court of Appeal | Yes | [1951] 2 KB 215 | England and Wales | Endorsed by Singapore Court of Appeal in Gay Choon Ing v Loh Sze Ti Terence Peter and another appeal. Cited for the principle that the element of request is necessary to establish a link between the parties concerned for consideration. |
| Gay Choon Ing v Loh Sze Ti Terence Peter and another appeal | Singapore Court of Appeal | Yes | [2009] 2 SLR(R) 332 | Singapore | Cited for the principle that the element of request is necessary to establish a link between the parties concerned for consideration. |
| Grossner Jens v Raffles Holdings Ltd | High Court | Yes | [2004] 1 SLR(R) 202 | Singapore | Cited for the principle that negotiating parties may enter into a binding contract even when a few issues remain to be agreed, but there would be no binding obligation unless all the material terms of the contract were agreed on. |
| G. Scammell & Nephew, Ltd v HC & JG Ouston | House of Lords | Yes | [1941] AC 251 | United Kingdom | Cited for the principle that if the language used was so obscure and so incapable of any definite or precise meaning that the court is unable to attribute to the parties any particular contractual intention, there was never a contract. |
| May & Butcher v The King | House of Lords | Yes | [1934] 2 KB 17 | United Kingdom | Cited for the principle that as a matter of the general law of contract all the essentials have to be settled. |
| Foley v Classique Coaches Ltd | English Court of Appeal | No | [1934] KB 1 | England and Wales | Distinguished from May & Butcher. Cited for the principle that a term must be implied in the agreement that the petrol supplied by the plaintiff should be of reasonable quality and sold at a reasonable price, and that if any dispute arose as to what was a reasonable price, it was to be determined by arbitration. |
| Bumi Geo Engineering Pte Ltd v Civil Tech Pte Ltd | Singapore High Court | Yes | [2015] 5 SLR 1322 | Singapore | Cited for the principle that parties are strictly bound by their pleadings and the court may not decide on issues not raised therein. |
| Benzline Auto Pte Ltd v Supercars Lorinser Pte Ltd and another | Singapore Court of Appeal | Yes | [2018] 1 SLR 239 | Singapore | Cited for the principle that laymen unassisted by persons with a legal training are not always accustomed to use words or phrases with a precise or definite meaning. |
| Audi Construction Pte Ltd v Kian Hiap Construction Pte Ltd | Singapore Court of Appeal | Yes | [2018] 1 SLR 317 | Singapore | Cited for the elements required to establish promissory estoppel. |
| Cupid Jewels Pte Ltd v Orchard Central Pte Ltd and another appeal | Singapore Court of Appeal | Yes | [2014] 2 SLR 156 | Singapore | Cited for the degree of certainty and clarity required in the representation alleged to form the basis of a promissory estoppel. |
| Sembcorp Marine Ltd v PPL Holdings Pte Ltd & anor | Singapore Court of Appeal | Yes | [2013] 4 SLR 193 | Singapore | Cited for the requirements of civil procedure for parties proposing a contextual approach to the construction of a contract or the implication of contractual terms. |
| Yap Son On v Ding Pei Zhen | Singapore Court of Appeal | Yes | [2017] 1 SLR 219 | Singapore | Cited for the importance of the pleading requirements established in Sembcorp Marine. |
| Zurich Insurance (Singapore) Pte Ltd v B-Gold Interior Design & Construction Pte Ltd | Singapore High Court | Yes | [2008] 3 SLR(R) 1029 | Singapore | Cited for the contextual approach to contractual construction which permitted recourse to extrinsic evidence of the external context of a contract in aid of its construction. |
| Lee Chee Wei v Tan Hor Peow Victor | Singapore Court of Appeal | Yes | [2007] 3 SLR(R) 537 | Singapore | Cited for the effect of entire agreement clauses. |
| The Wellness Group Pte Ltd and another v OSIM International Ltd and others and another suit | Singapore High Court | Yes | [2016] 3 SLR 729 | Singapore | Cited for the principle that the failure to plead the facts relied on to support the alleged implied term must lead to the failure of the claim on this implied term. |
| Ng Giap Hon v Westcomb Securities Pte Ltd and others | Singapore Court of Appeal | Yes | [2009] 3 SLR(R) 518 | Singapore | Cited for the principle that a contractual term cannot be implied if it is inconsistent with an express term of the contract concerned. |
| Ooi Ching Ling v Just Gems Inc | Singapore Court of Appeal | Yes | [2003] 1 SLR(R) 14 | Singapore | Cited for the principle that if the plaintiff gets something out of the contractual agreement, this remedy in total failure of consideration would not be available to him. |
| Anglia Television Ltd v Reed | English Court of Appeal | Yes | [1972] 1 QB 60 | England and Wales | Cited for the principle that in claiming compensation for the defendant’s breach of contract the plaintiff can claim for loss of profit; but if he has not suffered any loss of profits or if he cannot prove what his profits would have been, he can claim in the alternative the expenditure which has been thrown away – that is, wasted expenditure. |
| CCC Films (London) Ltd v Impact Quadrant Films Ltd | Queen's Bench Division | Yes | [1985] QB 16 | England and Wales | Cited for the principle that wasted expenditure could include the contract sum paid by a plaintiff. |
| PT Panosonic Gobel Indonesia v Stratech Systems Ltd | Singapore High Court | Yes | [2010] 3 SLR 1017 | Singapore | Cited for the principle that a claim for the contract sum as “wasted expenditure” following from a defendant’s contractual breach may look “superficially similar” to a claim for the same sum on the ground of total failure of consideration, but there were “material differences” between the two. |
| PT Panasonic Gobel Indonesia v Stratech Systems Ltd | Singapore High Court | Yes | [2009] 1 SLR(R) 470 | Singapore | Cited for the principle that the plaintiff had failed to plead a claim for refund of payments on the basis of total failure of consideration. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| No applicable statutes | |
15. Key Terms and Keywords
15.1 Key Terms
- Software Licence Agreement
- System Support and Maintenance Fees
- Global Trading Administration
- User Acceptance Testing
- Notice of Non-Compliance
- Matching Engine System
- E-Broker Core System
- Retail Lot Charges
- Entire Agreement Clause
- Promissory Estoppel
- Total Failure of Consideration
15.2 Keywords
- software license
- breach of contract
- system support
- maintenance fees
- trading platform
- financial software
- Singapore High Court
17. Areas of Law
16. Subjects
- Contract Law
- Software Licensing
- Commercial Dispute