Aik Heng Contracts And Services Pte Ltd v. Deshin Engineering & Construction Pte Ltd [2015] SGHC 293
Keywords: Keywords: Adjudication – Setting Aside – Breach of Natural Justice – SOP Act – Patent Errors
Facts
Aik Heng Contracts and Services Pte Ltd (AHCPL) were Deshin Engineering & Construction Pte Ltd’s (DECPL) subcontractors for the installation of aluminum frames and features at a condominium project in Singapore.
AHCPL lodged an adjudication application against DECPL. DECPL contested the adjudication application asserting that no payment was due to AHCPL considering, amongst others, damages incurred by DECPL from AHCPL’s breaches of the sub contract. However, DECPL lost at the adjudication. It was not permitted to raise any reasons for non-payment at the adjudication application as it had failed to provide a valid payment response.
DECPL applied to the High Court to set aside the adjudication determination on two main grounds: -
Decision
The High Court dismissed DECPL’s application. Regarding the NOI; the High Court held that the problem with the NOI was a technical breach and was insufficient to render the NOI invalid. Both parties could correctly identify the sub-contract in dispute notwithstanding the defect in the NOI.
Regarding the alleged breach of natural justice; the High Court found that the adjudicator had properly considered the application and did not apply a “blank and unthinking mind to the issues before him”.
It was further held that the adjudicators do not need to hear a respondent on any matter that the respondent ought to have put in a valid payment response but had failed to do so. However, an adjudicator must hear a respondent on any submission relating to patent errors on the documents or calculations or submissions of the claimant. Such “patent” or “manifest” errors are errors which are “obviously capable of affecting the outcome of the determination and “admit no difference of opinion”. In this case, DECPL did not seek to raise any patent or manifest errors at the adjudication application, so there was no breach of natural justice on the part of the adjudicator.
Aik Heng Contracts and Services Pte Ltd (AHCPL) were Deshin Engineering & Construction Pte Ltd’s (DECPL) subcontractors for the installation of aluminum frames and features at a condominium project in Singapore.
AHCPL lodged an adjudication application against DECPL. DECPL contested the adjudication application asserting that no payment was due to AHCPL considering, amongst others, damages incurred by DECPL from AHCPL’s breaches of the sub contract. However, DECPL lost at the adjudication. It was not permitted to raise any reasons for non-payment at the adjudication application as it had failed to provide a valid payment response.
DECPL applied to the High Court to set aside the adjudication determination on two main grounds: -
- the Notice of Intention (“NOI”) was defective as it did not set out the date of the contract. As such, the adjudicator did not have jurisdiction to adjudicate the claim; and
- the adjudicator had breached the principles of natural justice by failing to identify patent errors in the adjudication application and not giving the DECPL the opportunity to raise its contentions at the adjudication application.
Decision
The High Court dismissed DECPL’s application. Regarding the NOI; the High Court held that the problem with the NOI was a technical breach and was insufficient to render the NOI invalid. Both parties could correctly identify the sub-contract in dispute notwithstanding the defect in the NOI.
Regarding the alleged breach of natural justice; the High Court found that the adjudicator had properly considered the application and did not apply a “blank and unthinking mind to the issues before him”.
It was further held that the adjudicators do not need to hear a respondent on any matter that the respondent ought to have put in a valid payment response but had failed to do so. However, an adjudicator must hear a respondent on any submission relating to patent errors on the documents or calculations or submissions of the claimant. Such “patent” or “manifest” errors are errors which are “obviously capable of affecting the outcome of the determination and “admit no difference of opinion”. In this case, DECPL did not seek to raise any patent or manifest errors at the adjudication application, so there was no breach of natural justice on the part of the adjudicator.