Comfort Management v OGSP Engineering: Building Contract Dispute over Lump Sum Contract and Sub-contractor Claims

In a suit before the High Court of Singapore, Comfort Management Pte Ltd (Plaintiff) sued OGSP Engineering Pte Ltd (First Defendant) and Pintu Kumar Sarker (Second Defendant) over a lump sum construction contract for a project in Jurong. The Plaintiff claimed overpayment, liquidated damages, and back charges against the First Defendant, and breach of duty against the Second Defendant. The First Defendant counterclaimed for outstanding payments. The court found that the First Defendant had completed 95.29% of the works, entitling it to additional payment, but also liable for liquidated damages. The Plaintiff's claims for defects and against the Second Defendant were dismissed. The First Defendant was awarded part of its counterclaim for variation order VO1 and a quantum meruit for VO2. The First Defendant owes the Plaintiff $363,030.51.

1. Case Overview

1.1 Court

High Court of the Republic of Singapore

1.2 Outcome

Judgment for Plaintiff in part and Judgment for First Defendant in part; Plaintiff's claim against Second Defendant dismissed.

1.3 Case Type

Civil

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

Building and construction law case involving a lump sum contract dispute. The court addressed sub-contractor claims, scope of works, variations, and breach of duty.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
COMFORT MANAGEMENT PTE LTDPlaintiff, Defendant in CounterclaimCorporationClaim dismissed in partPartial
OGSP ENGINEERING PTE LTDDefendant, Plaintiff in CounterclaimCorporationCounterclaim allowed in partPartial
PINTU KUMAR SARKERDefendantIndividualClaim DismissedDismissed

3. Judges

Judge NameTitleDelivered Judgment
Vinodh CoomaraswamyJudgeYes

4. Counsels

Counsel NameOrganization
Zhulkarnain Abdul RahimDentons Rodyk & Davidson LLP
Paul WongDentons Rodyk & Davidson LLP
Andrea GanDentons Rodyk & Davidson LLP
Francis WuDentons Rodyk & Davidson LLP
Nicholas LazarusJusticius Law Corporation
Anil LalwaniDL Law Corporation
Adrian TeoDL Law Corporation

4. Facts

  1. Comfort Management entered into a lump sum construction contract with OGSP Engineering for a project in Jurong.
  2. OGSP Engineering commenced work under the Comfort Contract in October 2013.
  3. OGSP Engineering demobilised its team and withdrew from the site on 9 October 2014.
  4. Lead certified that 95.29% of the Works had been completed as at 15 September 2014.
  5. The Temporary Occupation Permit for the Project was issued on 24 December 2014.
  6. Comfort Management claimed overpayment, liquidated damages, and back charges against OGSP Engineering.
  7. OGSP Engineering counterclaimed for outstanding payments for completed works and materials.

5. Formal Citations

  1. Comfort Management Pte Ltd v OGSP Engineering Pte Ltd and another, Suit No 509 of 2017, [2020] SGHC 165

6. Timeline

DateEvent
Comfort Management entered into a lump sum construction contract with OGSP Engineering for a project in Jurong.
OGSP Engineering commenced work under the Comfort Contract.
Stipulated completion date for the Works under the Comfort Contract.
Comfort Management awarded VO1 to OGSP Engineering for additional works.
Lead Management Engineering & Construction Pte Ltd certified that 95.29% of the Works had been completed.
Lead issued Certificate of Payment No 13 to Comfort Management.
Lead emailed Comfort Management listing outstanding items under the Lead Contract.
OGSP Engineering demobilised its team and withdrew from the site.
Temporary Occupation Permit for the Project was issued.
Lead issued Certificate of Payment No 14R1.
Lead emailed Comfort Management enclosing the Statement of Final Account.
OGSP Engineering issued a tax invoice to Comfort Management for work carried out at the Commercial Block.
Adjudication Determination was issued.
Comfort Management commenced action against OGSP Engineering and Pintu Kumar Sarker.

7. Legal Issues

  1. Breach of Contract
    • Outcome: The court found that the first defendant had completed 95.29% of the works and was liable for liquidated damages.
    • Category: Substantive
    • Sub-Issues:
      • Failure to complete works
      • Overpayment
      • Liquidated damages
  2. Negligence
    • Outcome: The court dismissed the plaintiff's claim against the second defendant for breach of duty.
    • Category: Substantive
    • Sub-Issues:
      • Breach of duty
      • Causation
      • Over-certification
  3. Variation Orders
    • Outcome: The court allowed the first defendant's counterclaim for variation order VO1 and a quantum meruit for VO2.
    • Category: Substantive
    • Sub-Issues:
      • Validity of variation orders
      • Quantum meruit
  4. Liquidated Damages
    • Outcome: The court found the liquidated damages clause to be enforceable and awarded liquidated damages to the plaintiff.
    • Category: Substantive
    • Sub-Issues:
      • Enforceability of liquidated damages clause
      • Causation of delay

8. Remedies Sought

  1. Monetary Damages
  2. Declaration

9. Cause of Actions

  • Breach of Contract
  • Negligence
  • Quantum Meruit

10. Practice Areas

  • Building and Construction Contracts
  • Sub-contracts
  • Variations
  • Breach of Contract
  • Negligence

11. Industries

  • Construction

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Mansource Interior Pte Ltd v CSG Group Pte LtdHigh CourtYes[2017] 5 SLR 203SingaporeCited to support the principle that a contractor is entitled to recover an overpayment from a subcontractor under a lump sum contract.
GIB Automation Pte Ltd v Deluge Fire Protection (SEA) Pte LtdHigh CourtYes[2007] 2 SLR(R) 918SingaporeCited to define the term 'back-to-back' in the context of construction sub-contracts.
Saeng-Un Udom v Public ProsecutorHigh CourtYes[2001] 2 SLR(R) 1SingaporeCited for the principle that expert evidence is not discounted simply because the expert is selected, engaged and paid by a party.
Comfort Management Pte Ltd v OGSP Engineering Pte LtdCourt of AppealYes[2018] 1 SLR 979SingaporeCited for the interpretation of s 17(3) of the Building and Construction Industry Security of Payment Act and the grounds on which an adjudication determination could be set aside.
Audi Construction Pte Ltd v Kian Hiap Construction Pte LtdCourt of AppealYes[2018] 1 SLR 317SingaporeCited for the principle that a waiver by election requires a party to a contract making a clear and unequivocal choice between two inconsistent rights.
Eng Chiet Shoong and others v Cheong Soh Chin and others and another appealCourt of AppealYes[2016] 4 SLR 728SingaporeCited for the alternative approaches towards the award of a reasonable sum for work done by a claimant.
Sembcorp Marine Ltd v PPL Holdings Pte Ltd and another and another appealCourt of AppealYes[2013] 4 SLR 193SingaporeCited for the traditional 'business efficacy' and 'officious bystander' tests.
Sunny Metal & Engineering Pte Ltd v Ng Khim Ming EricCourt of AppealYes[2007] 3 SLR(R) 782SingaporeCited for the principle that the 'but for' test in tort can also be used in contract cases to determine the issue of causation in fact.
Chong Yeo and Partners and another v Guan Ming Hardware and Engineering Pte LtdHigh CourtYes[1997] 2 SLR(R) 30SingaporeCited for the principle that the burden of proof lies on the plaintiff to show that the defendant’s breach is the effective cause of its loss.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
Building and Construction Industry Security of Payment Act (Cap 30B, 2006 Rev Ed)Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • Lump Sum Contract
  • Sub-contract
  • Variation Order
  • Liquidated Damages
  • Overpayment
  • Back Charges
  • Quantum Meruit
  • Certification
  • Defective Work

15.2 Keywords

  • construction contract
  • lump sum
  • subcontractor
  • variation
  • liquidated damages
  • negligence
  • Singapore
  • building law

17. Areas of Law

Area NameRelevance Score
Building and Construction Contracts90
Construction Law85
Lump sum contract80
Sub-contracts75
Breach of Contract70
Scope of Works70
Variations65
Negligence65
Contract Law60
Causation55
Torts50
Breach of Duty50
Damages40

16. Subjects

  • Construction Dispute
  • Contract Law
  • Building and Construction Law
  • Civil Procedure