Case Details
- Citation: [2023] SGHC(A) 20
- Title: Diamond Glass Enterprise Pte Ltd v Zhong Kai Construction Company Pte Ltd
- Court: Appellate Division of the High Court of the Republic of Singapore
- Date: 31 May 2023
- Judges: Woo Bih Li JAD, Hoo Sheau Peng J and Quentin Loh SJ
- Proceedings: Civil Appeal Nos 125 and 129 of 2021 (cross-appeals)
- Underlying Suit: Suit No 1282 of 2019
- Appellant in CA 125: Diamond Glass Enterprise Pte Ltd
- Respondent in CA 125: Zhong Kai Construction Company Pte Ltd
- Appellant in CA 129: Zhong Kai Construction Company Pte Ltd
- Respondent in CA 129: Diamond Glass Enterprise Pte Ltd
- Legal area(s): Building and Construction Law (Damages; Liquidated damages; Variations; Costs)
- Statutes referenced: Building and Construction Industry Security of Payment Act (Cap 30B, 2006 Rev Ed)
- Key prior decision: Zhong Kai Construction Co Pte Ltd v Diamond Glass Enterprise Pte Ltd [2021] SGHC 277 (Trial Judgment)
- Key appeal decision: Diamond Glass Enterprise Pte Ltd v Zhong Kai Construction Co Pte Ltd and another appeal [2022] SGHC(A) 44 (Appeal Judgment)
- Cases cited: [2021] SGHC 277
- Judgment length: 39 pages, 10,310 words
- Nature of this decision: Supplementary judgment addressing issues raised after the Appeal Judgment and costs of the appeals
Summary
This supplementary judgment in Diamond Glass Enterprise Pte Ltd v Zhong Kai Construction Company Pte Ltd concerns two cross-appeals arising from a building subcontract dispute at Changi Airport. The Appellate Division had earlier issued an appeal judgment in December 2022, which partially allowed both parties’ appeals. After the appeal judgment was released, counsel for the subcontractor (DG) wrote to the court raising (i) whether the court had properly accounted for “remaining sums” that DG would have received if it had completed the subcontract works, and (ii) whether there was a calculation error in the appeal judgment’s arithmetic at paragraphs [279]–[280]. The court also addressed costs.
In the supplementary judgment dated 31 May 2023, the Appellate Division dealt with the post-judgment correspondence and clarified the scope and method of the damages computation. It also corrected (or declined to correct) the alleged calculation error, depending on whether the arithmetic issue was real and whether the proposed correction aligned with the court’s earlier reasoning. The court’s approach underscores that supplementary judgments are not a vehicle to re-litigate matters that were not properly raised or pleaded, and that damages calculations must be tied to the pleaded case and the correct legal measure.
What Were the Facts of This Case?
Zhong Kai Construction Company Pte Ltd (“ZK”) engaged Diamond Glass Enterprise Pte Ltd (“DG”) as a subcontractor to supply materials, equipment and tools, and to carry out and complete specified aluminium cladding and related works for an airport project at Singapore Changi Airport. The subcontract was evidenced by a Letter of Award dated 7 November 2016 (the “Subcontract”). The scope included aluminium cladding of an external facade, blast/ballistic doors and windows, aluminium doors, and window works.
Disputes arose after DG’s performance faltered. In Suit No 1282 of 2019, ZK claimed against DG for liquidated damages arising from DG’s delays. ZK also claimed a further sum of $340,233.10 for replacement works and rectification works, which ZK said were necessitated by DG’s abandonment of the worksite around 6 June 2018. DG, in turn, counterclaimed for sums allegedly due under four variation orders (“VOs”)—DV0006 (VO 6), DV0008 (VO 8), DV00018 (VO 18) and DV00019 (VO 19)—and also sought the retention sum under the Subcontract.
Separately, the dispute intersected with Singapore’s statutory adjudication regime. ZK sought to overturn an adjudicated amount awarded to DG in Adjudication Determination No 339 of 2019 (“AA 339”) under the Building and Construction Industry Security of Payment Act (Cap 30B, 2006 Rev Ed) (“SOP Act”). The adjudication outcome therefore formed part of the factual and procedural background to the civil suit.
At first instance, the trial judge allowed ZK’s claims for liquidated damages and for costs of replacement and rectification works in part. The trial judge also allowed DG’s counterclaim for payment due under VO 18 (in the amount of $5,070) but disallowed DG’s counterclaims for VO 6, VO 8 and VO 19. On appeal, the Appellate Division issued the Appeal Judgment (reported as [2022] SGHC(A) 44), allowing DG’s appeal in CA 125 in part and allowing ZK’s appeal in CA 129 in part. Among other things, the Appellate Division set aside an award to ZK for replacement and rectification works, allowed ZK’s claim for a replacement/rectification sum of $27,735.47, and allowed DG’s counterclaims for VO 6, VO 8 and the retention sum.
What Were the Key Legal Issues?
The supplementary judgment addressed two substantive issues raised after the Appeal Judgment, both framed by DG’s solicitors through letters to the court. The first issue (“Remaining Sums Issue”) asked whether, when calculating the sums DG would have to pay ZK (or, conversely, the sums ZK would have to pay DG), the court should have deducted from the replacement and rectification costs the value of “remaining works” that DG would have completed had it not abandoned the site. DG argued that without such deductions, ZK would obtain a windfall—receiving the full benefit of the subcontract works without paying the subcontract price for the remaining cabin glass panels and other uncompleted elements.
The second issue (“Calculation Error Issue”) concerned alleged arithmetic mistakes in the Appeal Judgment at paragraphs [279]–[280]. DG contended that the court used an incorrect total for the set-aside VOs (VO 6, VO 8 and VO 18) and therefore arrived at an incorrect figure for DG’s entitlement as a proportion of the adjudicated claims under AA 339. DG requested correction of the relevant paragraphs.
In addition to these substantive issues, the court also considered costs: the costs of the appeals and ancillary costs orders, reflecting the practical importance of post-judgment clarification in complex construction disputes where multiple heads of claim and counterclaim are involved.
How Did the Court Analyse the Issues?
On the Remaining Sums Issue, the Appellate Division focused on the proper measure of damages and, crucially, on the limits imposed by pleadings and the scope of the parties’ cases. DG’s argument was essentially that the replacement and rectification costs awarded to ZK should be netted down by the value of the works that DG would have completed under the Subcontract. The court accepted that, in principle, damages must reflect the correct economic position and avoid overcompensation. However, it did not treat DG’s post-judgment argument as an automatic requirement to deduct the “remaining sums” from the replacement/rectification award.
The court emphasised that the calculation of damages cannot be detached from what was pleaded and what was actually in issue on appeal. DG’s complaint was that the Appeal Judgment addressed the deduction of the retention sum but did not address other remaining works valued at $62,514.30. Yet the court’s analysis turned on whether those remaining works were properly part of the pleaded case and whether the deduction was legally and factually necessary for the measure applied. The supplementary judgment indicates that DG’s lack of pleadings mattered: DG had not framed its case such that the replacement and rectification costs were to be reduced by the value of uncompleted subcontract elements beyond the retention sum already addressed.
Further, the court considered the conceptual basis of the “windfall” argument. While DG asserted that ZK would effectively receive the full benefit of the subcontract without paying the subcontract price for the remaining cabin glass panels, the court’s reasoning suggests that this outcome does not necessarily follow where the replacement works are awarded as damages for breach. In construction disputes, replacement/rectification awards often represent the cost of putting the employer in the position it would have been in had the subcontractor performed. Whether the employer must also pay the subcontract price for the uncompleted portion depends on the contractual and damages framework, including how the subcontract price and the employer’s actual costs are treated in the pleadings and evidence.
On the Calculation Error Issue, the court examined the arithmetic and the underlying numbers used in the Appeal Judgment. DG’s position was that the total for VO 6, VO 8 and VO 18 should have been $50,857.50 rather than $50,875.50. The court analysed whether the alleged discrepancy was real and whether it affected the final figures at [279]–[280]. The supplementary judgment’s approach reflects a common appellate discipline: a court will correct errors only where they are genuine and where correction is consistent with the reasoning and the record. If the alleged error is immaterial, or if the proposed correction conflicts with the court’s earlier findings, the court will decline to amend.
Although the extract provided is truncated, the structure of the supplementary judgment indicates that the court treated the calculation complaint as a narrow request for correction rather than an invitation to revisit the merits. It therefore assessed whether the arithmetic in the Appeal Judgment was indeed wrong and whether the corrected figures would change the substantive outcome. The court’s handling of this issue also illustrates that supplementary judgments are designed to address clerical or consequential errors and post-judgment clarifications, not to reopen the appellate determination.
Finally, the court addressed costs. In construction litigation, costs often become a significant practical issue because parties may succeed on some heads of claim and fail on others. The supplementary judgment therefore dealt with both the costs of the appeals and ancillary costs orders, ensuring that the final costs position reflected the court’s determinations.
What Was the Outcome?
The Appellate Division issued orders in the supplementary judgment addressing DG’s two raised issues and the costs consequences. The practical effect was to clarify the damages computation framework and to resolve whether the “remaining sums” deduction was required beyond the retention sum already dealt with in the Appeal Judgment. The court also resolved the request to correct the alleged calculation error at [279]–[280], confirming whether any amendment was warranted.
In addition, the court made orders on the costs of the appeals and ancillary costs. This ensured that the parties’ financial exposure was finalised following the Appeal Judgment, subject only to the supplementary clarifications and corrections made by the court.
Why Does This Case Matter?
This case matters for practitioners because it demonstrates how appellate courts in Singapore handle post-judgment correspondence and requests for clarification. The supplementary judgment reinforces that parties cannot use letters after judgment to broaden the scope of the dispute or to introduce new damages methodologies that were not pleaded or argued within the proper appellate framework. For construction litigators, this is a reminder to ensure that damages calculations—especially those involving netting, set-off, or deductions—are clearly articulated in pleadings and submissions.
Substantively, the decision is relevant to the calculation of damages in building and construction disputes, particularly where a subcontractor abandons the site and the employer claims replacement and rectification costs. The court’s reasoning indicates that the “correct measure” of damages is not merely an accounting exercise; it is tied to the legal characterisation of the claim, the evidence, and the pleadings. The case therefore provides guidance on how courts may treat arguments that an employer would otherwise obtain a “windfall”.
Finally, the case is useful for understanding the interaction between civil proceedings and adjudication under the SOP Act. While the supplementary judgment focuses on damages and costs, the broader litigation context includes challenges to adjudicated amounts. Practitioners should therefore take note of how appellate courts manage the relationship between adjudication outcomes and the final civil determination, and how arithmetic and entitlement issues can become significant when multiple VOs and retention sums are involved.
Legislation Referenced
- Building and Construction Industry Security of Payment Act (Cap 30B, 2006 Rev Ed) (“SOP Act”)
Cases Cited
Source Documents
This article analyses [2023] SGHCA 20 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the full judgment for the Court's complete reasoning.