Crescendas Bionics v Jurong Primewide: Construction Contract Dispute over Preliminaries, Performance Bond, Shared Savings & Project Delays
In Crescendas Bionics Pte Ltd v Jurong Primewide Pte Ltd, the High Court of Singapore addressed a dispute arising from a Letter of Intent (LOI) for a construction project. Crescendas Bionics (Plaintiff), a property developer, engaged Jurong Primewide (Defendant), a building contractor, for a seven-storey business park development. The dispute concerned the agreed preliminaries sum, a performance bond, shared savings, and project delays. The court found that the preliminaries sum was fixed, the defendant was not entitled to costs for a conditional performance bond, the defendant did not waive its share of the first $5 million in shared savings, and both parties contributed to project delays. The court allowed the defendant's counterclaim for its share of the shared savings and allowed the plaintiff's claim for delays, holding the defendant liable for general damages for 133 days of delay and ordering a refund of a portion of additional preliminaries paid.
1. Case Overview
1.1 Court
High Court of Singapore1.2 Outcome
Partial Judgment for Plaintiff; Partial Judgment for Defendant
1.3 Case Type
Civil
1.4 Judgment Type
Oral Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Singapore court case between Crescendas Bionics and Jurong Primewide concerning a construction contract dispute, focusing on preliminaries, performance bond, shared savings, and project delays.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Crescendas Bionics Pte Ltd | Plaintiff, Defendant in counterclaim | Corporation | Partial Judgment | Partial | |
| Jurong Primewide Pte Ltd | Defendant, Plaintiff in counterclaim | Corporation | Partial Judgment | Partial |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Tan Siong Thye | Judge | Yes |
4. Counsels
4. Facts
- Crescendas Bionics and Jurong Primewide entered into a Letter of Intent for a construction project.
- The LOI stipulated a Guaranteed Maximum Price contract with a contract sum of $95,870,000.
- Disputes arose regarding the preliminaries sum, a performance bond, shared savings, and project delays.
- The project was completed on 12 January 2011, exceeding the stipulated 18-month period.
- The plaintiff terminated the Resident Engineer without an immediate replacement, causing delays.
- The plaintiff interfered in the tender process for the RC works trade contract.
- The plaintiff delayed approval of the Aluminium and Glazing works trade contract.
5. Formal Citations
- Crescendas Bionics Pte Ltd v Jurong Primewide Pte Ltd, Suit No 477 of 2015, [2019] SGHC 04
6. Timeline
| Date | Event |
|---|---|
| Letter of Intent signed | |
| Letter of Intent executed | |
| Contract commencement date | |
| Draft WT Contract circulated | |
| Revised Preliminaries Breakdown sent | |
| Another revised version of the preliminaries breakdown provided | |
| Plaintiff directed defendant not to award any trade contract without its approval | |
| Resident Engineer terminated | |
| Defendant informed plaintiff and JCPL that termination of Resident Engineer without immediate replacement would cause delays | |
| Plaintiff reminded defendant that it was PW2’s instruction that the replies from the tenderers remained sealed until his return | |
| Plaintiff introduced Chang Hua as a tenderer for RC works | |
| Meeting held between parties | |
| Meeting held between parties | |
| Defendant issued final recommendation and tender report of the RC works for the plaintiff’s approval | |
| Plaintiff replied to the defendant that it had concerns about some of the defendant’s staff | |
| Superintending Officer drafted a new procurement flowchart | |
| Plaintiff wrote to the defendant and made reference to a meeting held between the parties on 1 April 2009 | |
| Defendant reverted back to the plaintiff regarding its proposed changes to the signed LOI | |
| Plaintiff made reference to a meeting between the parties on 7 April 2009 | |
| Defendant reminded the plaintiff that the 6 April Letter was purely on a goodwill basis | |
| Defendant stated that the points raised in the plaintiff’s letter dated 13 April 2009 simply stated the plaintiff’s preferred outcomes on certain issues raised at the meeting on 7 April 2009 | |
| Plaintiff acknowledged that the defendant had not agreed to waive its share in the first $5 million of the shared savings | |
| Tenderers re-submitted their revised tender bids based on a shorter project duration | |
| Defendant wrote to the plaintiff where it referred to a meeting between the parties on 20 April 2009 | |
| Plaintiff put in writing the various positions of the parties in the ongoing dispute between them | |
| Plaintiff sent letter to defendant | |
| Defendant informed the plaintiff that the parties had not come to any agreement | |
| Defendant wrote to plaintiff as a follow up on their meeting earlier the same day | |
| Plaintiff asked for confirmation that the GMP reduce by $5 million as you had offered from the onset | |
| Defendant replied that the GMP saving will not be counted in the first 5 millions, not the GMP | |
| Defendant issued its tender recommendation and the plaintiff accepted this recommendation | |
| Defendant provided the plaintiff with the OCBC Bond | |
| Tender report and recommendation for the award of the Aluminium and Glazing works trade contract was issued for the plaintiff’s approval | |
| Plaintiff gave its approval for the award of the Aluminium and Glazing works trade contract | |
| Plaintiff returned the OCBC Bond to the defendant | |
| Registered Inspector conducted a combined mechanical and electrical, and architectural inspection of the Project site | |
| Superintending Officer informed the defendant that there were certain follow-up works which had to be done | |
| Building and Construction Authority conducted a pre-Temporary Occupation Permit inspection of the Project | |
| Project was ready for Temporary Occupation Permit application | |
| Project certified as completed by the Superintending Officer | |
| Affidavit of Evidence in Chief of Lawrence Leow Chin Hin dated | |
| Affidavit of Evidence in Chief of Tang Tat Kwong dated | |
| Affidavit of Evidence in Chief of Onn Soon Lee dated | |
| Trial began | |
| Trial concluded | |
| Judgment reserved |
7. Legal Issues
- Breach of Contract
- Outcome: The court found that both parties had breached the contract in different aspects. The defendant was liable for delays, and the plaintiff was liable for not paying the defendant its share of the shared savings.
- Category: Substantive
- Sub-Issues:
- Delay in completion
- Disputes over contractual terms
- Disputes over preliminaries sum
- Failure to provide performance bond
- Disputes over shared savings
- Contractual Interpretation
- Outcome: The court interpreted the Letter of Intent (LOI) to determine the parties' obligations regarding the preliminaries sum, performance bond, shared savings, and project completion.
- Category: Substantive
- Sub-Issues:
- Rules of construction
- Offer
- Acceptance
- Consideration
- Waiver
8. Remedies Sought
- Monetary Damages
- Refund of additional preliminaries paid
9. Cause of Actions
- Breach of Contract
10. Practice Areas
- Commercial Litigation
- Construction Law
11. Industries
- Construction
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| CIFG Special Assets Capital I Ltd (formerly known as Diamond Kendall Ltd) v Ong Puay Koon and others and another appeal | Court of Appeal | Yes | [2018] 1 SLR 170 | Singapore | Cited for the principles to be applied in the construction of contracts. |
| Lucky Realty Co Pte Ltd v HSBC Trustee (Singapore) Ltd | unknown | Yes | [2016] 1 SLR 1069 | Singapore | Cited for the principle that the starting point in construing a contract is to look at the text that the parties have used. |
| Zurich Insurance (Singapore) Pte Ltd v B-Gold Interior Design & Construction Pte Ltd | unknown | Yes | [2008] 3 SLR(R) 1029 | Singapore | Cited for the principle that it is permissible to have regard to the relevant context as long as the relevant contextual points are clear, obvious and known to both parties. |
| Sembcorp Marine Ltd v PPL Holdings Pte Ltd | Court of Appeal | Yes | [2013] 4 SLR 193 | Singapore | Cited for the principle that the court has regard to the relevant context because it places the court in the best possible position to ascertain the parties’ objective intentions by interpreting the expressions used by them in their proper context. |
| Yap Son On v Ding Pei Zhen | unknown | Yes | [2017] 1 SLR 219 | Singapore | Cited for the principle that the meaning ascribed to the terms of the contract must be one which the expressions used by the parties can reasonably bear. |
| Sembcorp Marine Ltd v PPL Holdings Pte Ltd and another and another appeal | Court of Appeal | Yes | [2013] 4 SLR 193 | Singapore | Cited for the requirements in relation to pleadings of extrinsic facts for the purpose of contractual interpretation. |
| Legis Point LLC v Tay Choon Ai | unknown | Yes | [2018] 3 SLR 1269 | Singapore | Cited for the principle that under the contra proferentum principle, a viable interpretation that is against the interests of the draftsman is to be preferred. |
| O’Hare v Coutts | English High Court | Yes | [2016] EWHC 2224 | England and Wales | Cited for the principle that whether an offer is a “goodwill” offer which does not give rise to a legal obligation or a legally binding offer will depend on the circumstances and the intention of the parties at the material time when the “goodwill” offer is made. |
| Yap Boon Keng Sonny v Pacific Prince International Pte Ltd and another | unknown | Yes | [2009] 1 SLR(R) 385 | Singapore | Cited for the principle that an “act of prevention” is committed when the plaintiff prevents, impedes or otherwise makes it more difficult for the defendant to complete the works by the date stipulated in the contract. |
| Adyard Abu Dhabi v SD Marine Services | English High Court | Yes | [2011] EWHC 848 | England and Wales | Cited for the principle that to constitute an act of prevention, the plaintiff’s action had to cause delay to the actual progress of the works involved in the Project such that it impeded the Project and delayed its completion date. |
| Jeram Falkus Construction Limited v Fence Investments Inc | English High Court | Yes | [2011] EWHC 1935 (TCC) | England and Wales | Cited for the principle that to constitute an act of prevention, the plaintiff’s action had to cause delay to the actual progress of the works involved in the Project such that it impeded the Project and delayed its completion date. |
| Fongsoon Engineering (S) Pte Ltd v Kensteel Engineering Pte Ltd | High Court | Yes | [2011] SGHC 82 | Singapore | Cited for the principle that where there is no extension of time clause, and the employer commits an act of prevention, the contractor is no longer bound by the original contractual completion date, and the time for the completion of the project will be set at large. |
| Pantland Hick v Raymond & Reid | unknown | Yes | [1893] AC 22 | England | Cited for the propositions on reasonable time to complete. |
| Astea (UK) Ltd v Time Group | unknown | Yes | [2003] All ER (D) 212 | England | Cited for the propositions on reasonable time to complete. |
| Lian Soon Construction Pte Ltd v Guan Qian Realty Pte Ltd | unknown | Yes | [1999] 3 SLR(R) 518 | Singapore | Cited for the principle that a contractor is entitled to plan and perform the work as he pleases, provided that he completes the project by the time fixed in the contract. |
| Greater London Council v Cleveland Bridge and Engineering Co | Queen’s Bench Division | Yes | 34 BLR 50 | England | Cited for the principle that in the absence of any indication to the contrary, a contractor is entitled to plan and perform the works as he pleases, provided always that he finishes it by the time fixed in the contract. |
| Kwang In Tong Chinese Temple v Fong Choon Hung Construction Pte Ltd | unknown | Yes | [1997] 1 SLR(R) 907 | Singapore | Cited for the principle that where there is no extension of time clause, and the employer commits an act of prevention, the contractor is no longer bound by the original contractual completion date, and the time for the completion of the project will be set at large. |
| Liza bte Ismail v Public Prosecutor | unknown | Yes | [1997] 1 SLR(R) 555 | Singapore | Cited for the principle that the court is still entitled to reject testimony even if it is not subjected to contradiction in cross-examination. |
| Auto Clean ‘N’ Shine Services (a firm) v Eastern Publishing Associates Pte Ltd | Court of Appeal | Yes | [1997] 2 SLR(R) 427 | Singapore | Cited for the principle that courts are sufficiently perceptive and robust to deal with and sift out attempts by litigants to reshape their evidence. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Building Control Act (Cap 29, 1999 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Letter of Intent
- Guaranteed Maximum Price
- Preliminaries Sum
- Performance Bond
- Shared Savings
- Liquidated Damages
- Temporary Occupation Permit
- Resident Engineer
- Trade Contract
- Act of Prevention
15.2 Keywords
- construction contract
- preliminaries
- performance bond
- shared savings
- project delays
- letter of intent
- guaranteed maximum price
- Singapore
- construction law
- contract law
17. Areas of Law
16. Subjects
- Contract Law
- Construction Law
- Building and Construction Law
- Contractual Disputes
- Construction Disputes