One of the recent cases I had highlighted in my recent talk on the SIA Conditions of Contract (held on 15 April 2015) was the Singapore Court of Appeal’s (CA) decision in Chin Ivan v H P Construction & Engineering Pte Ltd  SGCA 14.
In this instance, the project owner sought to stay the contractors’ application for summary judgment on the project architects’ payment certificates on the ground that the payment certificates had been obtained fraudulently. The fraud arose because the architect had issued certain Architects’ Instructions based solely on the contractors' representations to him. These representations were found to be questionable.
The contractors succeeded partially in the High Court which decided to only stay the portion of the claim tainted with fraud. The owner appealed to the CA and his appeal was allowed.
In its decision, the CA underlined the importance of the architect’s obligation to exercise his professional judgment and to be fair and impartial in the issuing of certificates under the SIA Conditions in view of the “temporary finality” accorded to such certificates. It was also stressed that certificates must be issued strictly in accordance with the terms of the contract. Any certificate that is issued in contravention of these requirements would lose its temporary finality .
The CA’s decision serves as a timely reminder to owners, contractors and architects on the role and obligation of architects’ in the SIA Conditions.
It is also of interest to note that the contractors had earlier submitted an adjudication application to claim for payment under the said certificates. The application failed on technical grounds. If the adjudication application had not been rejected, the contractors could have possibly succeeded in obtaining a determination for the claims untainted by fraud since the adjudicator is not bound by the architect’s certificates. (See: section 17(4) of the Building and Construction Industry Security Of Payment Act)
Tan Joo Seng
25 April 2015
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