Sandy Island Pte Ltd v Thio Keng Thay: Damages for Defects in Construction Contract
In Sandy Island Pte Ltd v Thio Keng Thay, the Court of Appeal of Singapore addressed an appeal concerning a sale and purchase agreement for a bungalow in Sentosa Cove. The respondent, Thio Keng Thay, sued the appellant, Sandy Island Pte Ltd, for breach of contract due to defects in the property. The court considered whether the respondent's unreasonable denial of access to the appellant for rectification works extinguished his right to claim damages at common law. The Court of Appeal dismissed the appeal, holding that the respondent's right to claim damages was not extinguished, although it would affect the assessment of the quantum recoverable.
1. Case Overview
1.1 Court
Court of Appeal of the Republic of Singapore1.2 Outcome
Appeal Dismissed
1.3 Case Type
Civil
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
The Court of Appeal held that a purchaser's right to claim damages for defects at common law was not extinguished despite denying the developer access for rectification works.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Thio Keng Thay | Respondent | Individual | Appeal Dismissed | Won | |
| Sandy Island Pte Ltd | Appellant | Corporation | Appeal Dismissed | Lost |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Judith Prakash | Judge of Appeal | No |
| Steven Chong | Judge of Appeal | No |
| Quentin Loh | Judge | Yes |
4. Counsels
4. Facts
- The appellant was the developer of waterfront villas in Sentosa Cove.
- The respondent purchased a four-storey detached bungalow from the appellant for $14.32 million.
- The SPA contained a defects liability clause requiring the appellant to rectify defects within 12 months.
- The respondent complained of numerous defects shortly after taking possession.
- The appellant admitted to 222 defects in full and 85 defects in part.
- The respondent denied the appellant access to the property to carry out rectification works.
- The respondent engaged a new contractor to carry out the rectification works.
5. Formal Citations
- Sandy Island Pte Ltd v Thio Keng Thay, Civil Appeal No 169 of 2019, [2020] SGCA 86
- Thio Keng Thay v Sandy Island Pte Ltd, High Court Suit No 1073 of 2016, [2019] SGHC 175
6. Timeline
| Date | Event |
|---|---|
| Respondent received notice of vacant possession | |
| Respondent took possession of the property | |
| Respondent sent email listing 277 defects | |
| Respondent sent additional email alleging fundamental defects | |
| Parties carried out a joint inspection of the property | |
| Appellant replied regarding the defects | |
| Respondent engaged JTA Construction to carry out rectification works | |
| Respondent instituted High Court Suit No 1073 of 2016 | |
| Civil Appeal No 169 of 2019 | |
| Judgment reserved | |
| Judgment delivered |
7. Legal Issues
- Breach of Contract
- Outcome: The court found that the appellant had breached its obligations under clause 10 of the SPA.
- Category: Substantive
- Sub-Issues:
- Defective workmanship
- Failure to comply with specifications
- Damages for Defects
- Outcome: The court held that the respondent's right to claim damages was not extinguished, although it would affect the assessment of the quantum recoverable.
- Category: Substantive
- Sub-Issues:
- Mitigation of damages
- Assessment of quantum
- Interpretation of Contractual Clauses
- Outcome: The court held that clause 17 of the SPA did not preclude the respondent from commencing any common law claim for damages against the appellant.
- Category: Substantive
- Sub-Issues:
- Defects liability clause
- Condition precedent
8. Remedies Sought
- Damages for costs of rectification
- Damages for costs of investigation
- Damages for loss of use of property
9. Cause of Actions
- Breach of Contract
10. Practice Areas
- Construction Law
- Commercial Litigation
11. Industries
- Construction
- Real Estate
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Thio Keng Thay v Sandy Island Pte Ltd | High Court | No | [2019] SGHC 175 | Singapore | Cited for the comprehensive setting out of the exchanges between the parties in relation to the defects. |
| Pearce and High Ltd v Baxter and Baxter | English Court of Appeal | Yes | [1999] BLR 101 | England and Wales | Cited for the proposition that a plaintiff’s departure from the requirements of a defects liability clause will affect the quantum of damages he is entitled to recover, rather than exclude his right to claim damages altogether. |
| Management Corporation Strata Title Plan No 1993 v Liang Huat Aluminium Ltd | Court of Appeal | Yes | [2001] 2 SLR(R) 91 | Singapore | Cited for the legal proposition that a common law right cannot be abrogated in the absence of clear express wording. |
| Yap Boon Keng Sonny v Pacific Prince International Pte Ltd and another | High Court | No | [2008] 1 SLR(R) 285 | Singapore | Cited by the appellant for the proposition that the respondent would be precluded from claiming for defects that were admitted by the appellant, whether pursuant to clause 17 or under common law. |
| Bitannia Pty Ltd v Parkline Constructions Pty Ltd | New South Wales Supreme Court | No | [2009] NSWSC 1302 | Australia | Cited by the appellant for the proposition that the respondent would be precluded from claiming for defects that were admitted by the appellant, whether pursuant to clause 17 or under common law. |
| Sunny Metal & Engineering Pte Ltd v Ng Khim Ming Eric | Court of Appeal | Yes | [2007] 3 SLR(R) 782 | Singapore | Cited for the test for determining whether an intervening event would amount to a novus actus. |
| Evergreat Construction Co Pte Ltd v Presscrete Engineering Pte Ltd | High Court | Yes | [2006] 1 SLR(R) 634 | Singapore | Cited for the prevention principle. |
| P & M Kaye v Hosier & Dickinson | Unknown | Yes | [1972] 1 All ER 121 | England and Wales | Cited for consequential damages. |
| Gilbert-Ash (Northern) Limited v. Modern Engineering (Bristol) Ltd | Unknown | Yes | [1974] A.C. 689 | England and Wales | Cited for the principle that neither party intends to abandon any remedies for its breach arising by operation of law, and clear and express words must be used in order to rebut this presumption. |
| Hancock v. B.W. Brazier (Anerley) Ltd | Unknown | Yes | [1996] 2 All E.R. 901 | England and Wales | Cited for the principle that a provision is generally to be regarded as providing an additional remedy for the employer, and not as releasing the contractor from his ordinary liability to pay damages for defective works. |
| Turner Corporation Pty Ltd v Austotel Pty Ltd | Unknown | No | (1994) 13 BCL 378 | Australia | Cited for the principle that the contract provides a code which establishes the rights, obligations and liabilities of the parties, and the mechanisms by which completion of the Works is to be achieved. |
| SAS Trustee Corporation v Scott Carver Pty Limited & others | New South Wales Supreme Court | Yes | [2003] NSWSC 1097 | Australia | Cited for the principle that a defects liability clause merely confers an additional right to the purchaser. |
| Sun Building Services Pty Ltd v Minh & another | Queensland Civil and Administration Tribunal | Yes | [2015] QCAT 134 | Australia | Cited for the principle that Bitannia had to be seen in its proper context. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Housing Developers Rules | Singapore |
| Housing Developers (Control & Licensing) Act (Cap 130, 1985 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Defects liability period
- Vacant possession
- Rectification works
- Common law damages
- Novus actus interveniens
- Prevention principle
- Mitigation of loss
15.2 Keywords
- defects
- construction
- contract
- damages
- Singapore
- Sentosa Cove
- breach of contract
- defects liability clause
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Construction Law | 95 |
| Building and Construction Contracts | 90 |
| Contract Law | 80 |
| Breach of Contract | 70 |
| Damages | 60 |
| Arbitration | 30 |
16. Subjects
- Building and Construction Contracts
- Damages
- Dispute Resolution