January / February 2014 • Issue No. 22  

Welcome to 2014, which is looking to be an exciting year ahead for the Construction Industry and Construction Law, and consequently SCL(S).


Construction Demand

The Building & Construction Authority (BCA) in early January indicated that Construction demand in 2014 is expected to remain strong at between $31 to $38 billion, boosted by public sector institutional and civil engineering projects amounting to 60%. These include the Thomson MRT Line (where contracts amounting to over $ 1 billion were awarded in the last quarter of 2013), Seng Kang Community Hospital, Senoko foodhub and Newton Flyover. The private sector takes up the remaining 40% amounting to between $12 to $16 billion (down from $21 billion in 2013) including Project Jewel and Changi Airport Terminal 4.

The Senior Minister of State for the Ministries of Trade & Industry and National Development Lee Yi Shyan urged developers to take the lead in productivity by adopting more buildable designs and technology, and stakeholders would follow with improvements in quality, allowing for better returns and long term sustainability.

The Minister of State, Ministry of Trade and Industry Teo Ser Luck indicated that key schemes may be prolonged to encourage businesses, including the Construction Industry (needing extra assistance to attract local workers), to continue to invest in improving productivity.

Five industries with the most immediate and urgent manpower needs will spearhead the shift towards new applied learning approaches in the Polytechnics and Institutes of Technical Education (ITEs). The five industries are the early childhood, healthcare and nursing, aerospace, building and construction, and manufacturing sectors. This was revealed by Senior Minister of State (Education and Law) Indranee Rajah at the beginning of this year.

Date Title
28 Feb 2014 SITE VISIT: Construction of C935 Sungei Road Station and Tunnels for Down Town Line 3
19 March 2014 Construction Insolvency – Views from Alpine Bau’s Liquidators and Lawyers
April 2014 SCL(S) 1st Networking Cocktail
24 April 2014 Due Diligence Obligations in Construction Contracts
May 2014 Negligence in the Construction Industry, the Court of Appeal case of Jurong Primewide PL vs Moh Seng Cranes PL
8 July 2014 Managing Construction Disputes (and Resolutions) – the efficient use of Scott Schedules and  Expert Witnesses Conferencing
Aug 2014 AGM/Annual Dinner
Aug 2014 Annual Construction Law Conference
Nov 2014 Construction Law 101
(5th Run)
September – December 2013
1. Chun Siang Oh
2. Kishan Pillay
3. Melvin Chan
4. Len Sheng Koong
5. Eugene Tan
6. Gerlando Butera
7. Lay Choo Lau
8. Siew Gim Lim
9. William Zhang
10. Sow Fen Lem
11. Kok Heng Dominic Dwayne Tan
12. Johannes Leonardus van Brecht
13. Ben Olbourne
14. Andrea Stauber
15. Wee Jian Ang
16. Wenzhao Zhuo
17. Szewei Julian Teoh
18. Terence Chin
19. Cynthia Chia
20. Chee Keong Lau
21. Vadivelu Gangadharan
22. Neville Anderson
23. Ian McLeod
24. Roderick Noble
25. Shack Keong Lim
January – February 2014
1. Zhichao Huang
2. Brian Bowie
3. Caroline Teo
4. Sock Huang Tay
5. Peck Eek Sophia Saw
6. Benjamin Gaw
7. Cheryl Lim
8. Mei Yong, Debbie Lee
9. Lianyun Mak
10. Shanmugam S/o Suppiah Suppiah
11. Martin Campbell
12. Angie Leanne Shi Ru Ang
13. Nurul Syairazi
14. Gopal Perumal
15. Danielle Brown
16. David Barnes
17. Yee Chong Wong
18. Katherine Surgeoner
19. Nicholas Sykes
20. Yew Foong Cheah

Construction Law 101 (4th run)
(8, 14, 16 & 22 January 2014)

Annual Construction Law Update 2014
(15 January 2014)

2nd Networking Cocktail
(5 December 2013)

Engineering 101 for Non-Engineers
(5th Run)
(5,7,13 &15 November 2013)


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Keynote Address by Mr. Seah Choo Meng at the SCL(S)
Annual Construction Law Conference (11 September 2013) -
Man-Year Entitlements and Productivity

This paper will trace the history and events that led to the formulation and implementation of various manpower policies and the current emphasis on measures to enhance productivity.

The formulation and changes in our industry’s manpower policies in particular those affecting foreign labour and the pace at which they are implemented are inevitably dictated by market forces and the way the industry reacts to prevailing conditions.

The Early Era
In the seventies and early eighties, freehold land was in abundance and there was no undue concern with regard to land prices. Land cost then constituted a relatively low 25% of total development cost giving it a ratio of 25 – 75. There was no exigency to complete the project in the shortest possible time and tenders were called some nine to ten months after the land had been procured. The availability of cheap financing meant that the economic viability of a project was not a pressing issue.

Land Price Pressure
Things changed in the nineties. Freehold land became a scarcity. In response, the government released land via public tenders. Land prices soared and eventually the component of land cost made up 75% of the total development cost giving a ratio of 75 – 25. In some projects, this ratio was an incredible 80 – 20. This was a dramatic reversal of the 25 – 75 norm we had been accustomed to in the seventies.

Land prices climbed upwards relentlessly. Cash flow became an inherent and critical consideration in the planning of a project. A laissez faire approach to optimal implementation would certainly sound the death knell of a company. The market forces now clearly dictated a change in procurement approach in ensuring a project was completed expeditiously.

Need to Change
In the late 80’s / 90’s, I studied the various procurement practices of other countries. I concluded that Hong Kong was very similar to ours and would be a good benchmark that we could learn from and emulate. In Hong Kong, piling works commenced three months after land had been secured.

Our industry therefore needed to cut short the development period and to aim for early commencement of work to counter the rising land cost. The latter at 75% of total development cost essentially meant that the proportion of cost allowed for construction was now at an incredulous low of 25%. To achieve the latter, construction work had to speed up and at lower cost than before.

Contributed by Seah Choo Meng, Director of Langdon & Seah

Singapore Construction Law Updates

Case Law:

The case of Choi Peng Kum and another v Tan Poh Eng Construction Pte Ltd [2013] SGHC 272 dealt with issues of validity of payment claim, interpretation of provisions of the SIA Conditions and the status of security deposited into court under the adjudication regime. The Court held that a payment claim was a valid payment claim although it was not supported by a valuation by a quantity surveyor and clause 32(8)(a) of the SIA Conditions (on termination of services of a contractor) did not preclude the engagement of the adjudication process. The Court further decided that monies paid into court under section 27(5) of the Building and Construction Industry Security of Payment Act (Cap. 30B) is to be held as security pending final decision of the first court and not after all avenues of appeal have been exhausted.

The High Court case of Qwik Built-Tech International Pte Ltd v Acmes Kings Corp Pte Ltd [2013] SGHC 278 involved various claims for monies due and payable arising from a building and construction project in Maldives. While the case was decided largely on the evidence, the Court considered a few contractual principles worth noting. The Court held that where a contractor fails to provide materials as required under a contract, the Court would allow for a diminution in the contract price by reference to the cost price of the omitted materials. The Court also held that where there is no agreement on the amount of payment to a contractor who is entitled to payment, a term that the contractor would be remunerated at a reasonable rate would be implied into the contract. However, the plaintiff contractor has the burden of adducing evidence to show what the reasonable rate is.

Contributed by Danna Er, MPillay & Sandy Chan, Aequitas Law LLP

“Evaluative” Mediation of Complex Construction Disputes

Singapore’s desire to become one of the world’s leading international mediation centres received impetus recently when the Working Group appointed by The Honourable Chief Justice Sundaresh Menon and the Ministry of Law In April 2013 submitted its recommendations in late 2013 on how best to achieve that objective. Those recommendations, among other things, call for the establishment of a Singapore Centre for International Commercial Mediation to serve as a provider of mediation services, and a Singapore International Mediation Institute to oversee training and certification of mediator competency. Such training and certification of construction industry mediators might well become the province of members of SCL(S).

For Singapore and the international construction industry, Singapore’s construction mediators ought to be "evaluative" rather than merely "facilitative”. A “facilitative” mediator is understood generally to be one who, for lack of expertise regarding the substantive issues in dispute, practices “shuttle diplomacy” by facilitating communications between the parties and by seeking monetary and other concessions from the parties without questioning each party's respective analyses of the factual and legal merits of its position. An “evaluative” mediator, on the other hand, is one who enhances the prospect of settlement by leading the parties themselves toward narrowing their differences in perception of the critical technical facts and legal issues in dispute

Contributed by Philip L. Bruner, Mediator and Arbitrator

  Construction Law 101 Workshop (4th run)
8, 14, 16 & 22 January 2014

Aimed at non-lawyers who work in the construction industry, ‘Construction Law 101’ was being run to explain the rights and obligations of contractors and employers, as well as time, payment, SOP and dispute related issues in construction contracts.

It was directed by Mohan Pillay (Managing Partner of Pinsent Masons MPillay LLP) who taught the 3 modules centred around construction contracts, subcontracting and payment principles and the Security of Payment Act, with his colleague, Toh Chen Han (Partner at Pinsent Masons MPillay), covering the 4th topic of dispute resolution and claim procedures. Held by way of 4 evening classes spanning across a 3 week period, the topics centred mainly around the SIA and PSSCOC forms of contracts and the legal aspects and obligations contained within them.

The course was attended by a diverse audience of over 50 people from governmental and public sector bodies, contractors, sub-contractors, suppliers, lawyers and consultants, a testament to the wide reach of the SCL.

Contributed by Jim Chessell, BK Burns Pte Ltd

SCL(S) Annual Construction Law Update 2014
15 January 2014

The Society of Construction Law (Singapore) organised its Annual Construction Law Update at STI Auditorium, Capital Tower on 15 January 2014. SCL(S) invited two senior and distinguished lawyers, Mr. Christopher Chua of M/s Wong Partnership and Mr. Chia Ho Choon of M/s KhattarWong to address the audience of over 118 participants at the seminar chaired by Mr. Darren Benger.

Contributed by Dwayne Tan, L&S Contract Advisory & Dispute Management Services Pte Ltd

  Newsletter Editors: Uma Menon & Danna Er

Society of Construction Law (Singapore)

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