Conflicts Concerning Delay, Defect, And Warranty Claims In Singapore Projects
📌 1. Overview: Delay, Defects, and Warranty in Singapore Construction Law
In Singapore, construction contracts (often governed by standard forms such as the Singapore Institute of Architects Conditions or bespoke agreements) frequently give rise to disputes about:
1) Delay Claims
• Whether the contractor is liable for damages (often liquidated damages) for late completion.
• Whether an Extension of Time (EOT) clause applies and how it affects “time at large.”
2) Defect Claims
• Whether the contractor delivered works according to contractual specifications.
• Whether the employer can recover the cost of rectification (“cost of cure”) or other damages.
3) Warranty Claims
• Contractual warranties usually cover defects only during a defined warranty period.
• Latent defects discovered after the warranty period may not be covered unless contract terms so provide.
Key legal tools include liquidated damages clauses, defects liability provisions, express warranties, and common law rights for breach of contract.
📌 2. Six Singapore Case Laws (With Legal Analysis)
1️⃣ Crescendas Bionics Pte Ltd v Jurong Primewide Pte Ltd [2019] SGHC 4
Facts
A construction contract contained a liquidated damages clause and a specified completion date but no EOT clause. The employer sought liquidated damages for delay.
Issue
Is the contractor liable for liquidated damages where there is no EOT clause and the employer allegedly contributed to the delay?
Holding
Without an EOT clause, the contractor must complete in a reasonable time; there is no fixed contractual completion date.
The liquidated damages clause becomes inoperative if there is no EOT mechanism.
Where the employer commits an act of prevention, the contractor is not bound by the original date but must still perform within reasonable time.
Principle
“Time at large” applies when no EOT clause exists: delay damages convert to general damages for breach of reasonable deadline.
2️⃣ Sandy Island Pte Ltd v Thio Keng Thay [2020] SGCA 86
Facts
A contract for construction of a residence included a defects liability clause. The employer claimed damages for defects; the contractor argued that remedies should be limited to survival under the defects clause.
Issue
Does a defects liability clause in a building contract extinguish the employer’s common law right to claim damages for defects?
Holding
No. The Singapore Court of Appeal held that absent clear and express wording to exclude common law rights, a defects liability clause does not extinguish the employer’s right to claim damages at common law for defects.
Principle
Parties retain common law rights for breach of contract despite defects liability provisions, unless the contract clearly removes such rights.
3️⃣ Thio Keng Thay v Sandy Island Pte Ltd [2019] SGHC 175
Facts
High Court earlier addressed the same dispute, focusing on defects and the right to damages where the contractor was prevented from rectifying works.
Issue
Whether a plaintiff must first allow the contractor to carry out rectification under the defects liability clause before claiming damages.
Holding
The court allowed a common law claim for damages because the contract did not expressly preclude those damages, even though the plaintiff failed to allow rectification.
Principle
Contractual procedural mechanisms (like access for rectification) do not automatically displace common law damages rights.
4️⃣ Diamond Glass Enterprise Pte Ltd v Zhong Kai Construction Co Pte Ltd [2022] SGHC(A) 44
Facts
A subcontractor failed to complete works by a contractual date, leading to contract termination. The main contractor sought liquidated damages for the delay.
Issue
Can a party claim liquidated damages for delay after termination of the contract?
Holding
Liquidated damages survive termination, but stop accruing at termination because primary obligations cease on termination.
Principle
Delay damages can be recovered up to termination, not beyond, unless parties agree otherwise.
5️⃣ Terrenus Energy SL2 Pte Ltd v Attika Interior + MEP Pte Ltd [2025] SGHC(A) 4
Facts
Terrenus sued for delay liquidated damages, general damages, and damages for defects in a solar facility project. The Appellate Division considered whether a party must have the intention to cure defects to claim cost of rectification.
Issue
Is a claimant’s intention to remedy defects necessary to award “cost of cure” damages?
Holding
No. A claimant may recover the cost of cure even if it does not intend to rectify the defect, provided the cost is reasonable and proportionate to putting the injured party in the contractual position.
Principle
Singapore law allows “cost of cure” damages without an express intention to carry out rectification, focusing on reasonableness.
6️⃣ GTMS Construction Pte Ltd v Ser Kim Koi (Appellate Division) [2022] SGHC(A) 34
Facts
A prolonged dispute over construction of three houses included allegations about improper extensions of time, certification, completion and defects; the owner counterclaimed for delay damages and defects rectification costs.
Issues
• Whether there was delay and its length.
• Whether liquidated damages applied.
• Whether defects and certification errors justified counterclaims.
Holding
The Court addressed delay and certification, holding that liquidated damages claims and some defect claims were valid, though issues existed about the extent and length of delays.
Principle
This case confirms the need to carefully establish critical path delays, compliance with contract procedures and quantification of damages under standard conditions.
📌 3. Key Legal Themes
📍 A. Delay & Liquidated Damages
EOT clauses are critical; their absence may render liquidated damages inoperable.
Liquidated damages can survive termination but stop accruing on the termination date.
Contractors may still be liable under general damages when EOT clauses are absent.
📍 B. Defect Claims
Defects liability provisions do not extinguish common law damages unless expressly and clearly stated.
Employers can recover the cost of rectification even if they do not plan to undertake rectification themselves.
📍 C. Warranty Claims
Warranties usually cover defects during the warranty period. Latent defects discovered afterward may not be covered unless specified.
📌 4. Practical Contracting Tips (From Singapore Case Law)
✅ Draft clear EOT provisions — to avoid “time at large” and ensure entitlement to delay damages.
✅ Spell out defects and warranty obligations — clear wording about what falls inside/outside the warranty period.
✅ Clarify rectification procedures — ensure procedures for defects don’t inadvertently limit common law rights.
✅ Define cost of cure remedies — including whether rectification intention matters, and tie to reasonableness.
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