Pro-Active Engineering v Prime Structures: Building Contract Dispute over Delay & Back Charges

Pro-Active Engineering Pte Ltd sued Prime Structures Engineering Pte Ltd in the General Division of the High Court of Singapore for $558,559.97, arising from engineering works on a building project. Prime Structures had engaged Pro-Active to supply, fabricate, and install steel works. Pro-Active claimed for contracted works and variation works, while Prime Structures alleged delays and back charges. The court found that Pro-Active had delayed the project, entitling Prime Structures to levy back charges, and awarded Pro-Active $179,151.04.

1. Case Overview

1.1 Court

High Court of the Republic of Singapore

1.2 Outcome

Judgment for Plaintiff in part.

1.3 Case Type

Civil

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

Pro-Active Engineering sues Prime Structures for payment. Court finds Pro-Active delayed project, allowing Prime to back charge, reducing Pro-Active's award.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Pro-Active Engineering Pte LtdPlaintiffCorporationJudgment for Plaintiff in partPartial
Prime Structures Engineering Pte LtdDefendantCorporationCounterclaim DiscontinuedWithdrawn

3. Judges

Judge NameTitleDelivered Judgment
Lai Siu ChiuSenior JudgeYes

4. Counsels

Counsel NameOrganization
Yong Zhee HoeRajwin & Yong LLP
Remya PisharathRajwin & Yong LLP
Lee Wei FanAnthony Law Corporation

4. Facts

  1. Pro-Active was contracted to supply, fabricate, and install steel works for the project.
  2. The original completion date was 30 June 2019.
  3. Pro-Active sourced materials from China.
  4. Prime established a letter of credit to pay Pro-Active's supplier.
  5. Shimizu removed the roof crown works from Pro-Active's scope due to delays.
  6. Prime engaged another subcontractor to complete the roof crown works.
  7. Pro-Active claimed for contracted works and variation works.
  8. Prime alleged delays and back charges.

5. Formal Citations

  1. Pro-Active Engineering Pte Ltd v Prime Structures Engineering Pte Ltd, Suit No 907 of 2021, [2023] SGHC 205

6. Timeline

DateEvent
Prime appointed Pro-Active via letter of appointment.
Letter of appointment countersigned by both parties.
Original completion date for contracted works.
Pro-Active informed Prime it would source materials from China.
Prime emailed Pro-Active regarding quality concerns about steel from China.
Prime sent Pro-Active instructions regarding roof crown works.
Andrew sent Pro-Active instructions on works to be done.
Prime instructed Pro-Active to carry out works for roof crown beams.
Kuon went to China to supervise fabrication of materials.
Prime issued catch-up schedule to Pro-Active.
Prime informed Pro-Active it would invoice for costs Shimizu charged.
Shimizu rejected Prime’s program to finish installation by February 2020.
Parties entered into a Variation Order.
Temporary Occupation Permit issued for the project.
Pro-Active filed writ of summons.
Trial began.
Judgment reserved.

7. Legal Issues

  1. Breach of Contract
    • Outcome: The court found that Pro-Active breached the contract by delaying the project.
    • Category: Substantive
    • Sub-Issues:
      • Failure to complete works
      • Delay in completion
  2. Back Charges
    • Outcome: The court found that Prime was entitled to levy back charges on Pro-Active, except for certain disallowed items.
    • Category: Substantive
    • Sub-Issues:
      • Validity of back charges
      • Reasonableness of expenses
  3. Liquidated Damages
    • Outcome: Prime discontinued its counterclaim for liquidated damages.
    • Category: Substantive
    • Sub-Issues:
      • Entitlement to liquidated damages
      • Extension of time
  4. Termination
    • Outcome: The court found that Prime served a valid notice of termination on Pro-Active for the roof crown works.
    • Category: Substantive
    • Sub-Issues:
      • Validity of termination notice
      • Reasonable notice

8. Remedies Sought

  1. Monetary Damages

9. Cause of Actions

  • Breach of Contract

10. Practice Areas

  • Construction Contracts
  • Commercial Litigation

11. Industries

  • Construction

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Peak Construction (Liverpool) Ltd v McKinney Foundations LtdN/AYes[1970] 1 BLR 111N/ACited regarding the principle that a party should not take advantage of its own wrongdoing in causing delays.
Vim Engineering Pte Ltd v Deluge Fire Protection (S.E.A.) Pte LtdHigh CourtYes[2023] SGHC(A) 2SingaporeCited regarding the need for reasonable notice prior to de-scoping works and proving back charges.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
No applicable statutes

15. Key Terms and Keywords

15.1 Key Terms

  • Contract sum
  • Variation works
  • Back charges
  • Liquidated damages
  • Letter of credit
  • Roof crown works
  • Re-measurement contract
  • Delay
  • Termination
  • Scope of works

15.2 Keywords

  • construction
  • contract
  • delay
  • back charges
  • engineering
  • steel works

17. Areas of Law

Area NameRelevance Score
Construction Law95
Building and Construction Contracts90
Contract Law80
Extension of time and liquidated damages70
Contractors’ duties70
Breach of Contract60
Delay in completion60
Failure to complete60
Back charges60
Scope of work50
Damages50
Civil Procedure50
Variations50
Discontinuance30

16. Subjects

  • Building and Construction Law
  • Contract Law
  • Construction Contracts
  • Commercial Disputes