Sree Ram Construction Pte Ltd v Green Tag Scaffolding Pte Ltd and another [2025] SGHCR 39

Case Details

• Citation: [2025] SGHCR 39
• Court: General Division of the High Court of the Republic of Singapore
• Decision Date: 26 December 2025
• Coram: AR Vikram Rajaram
• Case Number: Originating Claim No 429 of 2025; Summons No 2221 of 2025
• Hearing Date(s): 15 September, 9 and 28 October 2025
• Claimant: Sree Ram Construction Pte Ltd
• Defendants: Green Tag Scaffolding Pte Ltd (1st Defendant); Kumar (2nd Defendant)
• Counsel for Claimant: Celine Liow Wan-Ting (Forte Law LLC)
• Counsel for Defendants: Low Shauna (Jacob Mansur & Pillai)
• Practice Areas: Civil Procedure; Pleadings; Striking Out; Restitution; Unjust Enrichment

Summary

The judgment in Sree Ram Construction Pte Ltd v Green Tag Scaffolding Pte Ltd and another [2025] SGHCR 39 addresses a critical procedural question under the Rules of Court 2021 (ROC 2021): whether a defendant is legally mandated to bring all related claims as a counterclaim in an existing action, or whether they retain the right to commence a fresh, separate originating process. This dispute arose from a breakdown in the commercial relationship between Sree Ram Construction Pte Ltd (SRC) and Green Tag Scaffolding Pte Ltd (GTS), following a Share Swap Agreement (SSA) intended to bifurcate their shared business interests. After GTS commenced an earlier action (OC 15) for alleged breaches of the SSA, SRC initiated its own action (OC 429) involving claims for unjust enrichment, breach of contract, and tortious interference. GTS sought to strike out OC 429 in its entirety, arguing that the language of Order 6 Rule 8(1) of the ROC 2021 imposed a mandatory obligation on SRC to have filed these claims as counterclaims in OC 15.

The learned Assistant Registrar (AR) Vikram Rajaram dismissed the striking out application, providing a definitive interpretation of the word "must" within the context of Order 6 Rule 8(1). The court held that the ROC 2021 does not compel a defendant to bring a counterclaim; rather, the rules remain permissive. The "must" in the provision is conditional upon the defendant’s subjective intention to bring a counterclaim. If a defendant chooses not to counterclaim but instead elects to start a fresh action, they are not in breach of the procedural rules, provided such an action does not otherwise constitute an abuse of process. This decision preserves the fundamental right of a litigant to choose the timing and manner of their claims, subject to the court's power to manage proceedings through consolidation or costs sanctions.

Beyond the procedural interpretation of the ROC 2021, the court also dealt with a substantive challenge to SRC’s claim for unjust enrichment. GTS argued that the claim, which sought the return of a S$200,000 payment, was legally unsustainable because it was purportedly governed by a contract (the SSA). The court applied the established high threshold for striking out, concluding that the existence of a "goodwill agreement" separate from the SSA was a triable issue of fact. The judgment emphasizes that the court will not summarily dismiss claims unless they are "plainly and obviously unsustainable," particularly where the legal landscape regarding the intersection of contract and unjust enrichment remains nuanced.

Ultimately, the court ordered the consolidation of OC 15 and OC 429 to ensure the "just, expeditious and economical disposal" of the disputes, in line with the Ideals set out in Order 3 Rule 1 of the ROC 2021. This case serves as a vital authority for practitioners navigating the transition from the 2014 Rules to the 2021 Rules, clarifying that the new regime’s emphasis on efficiency does not override the basic architecture of party-led litigation regarding the commencement of claims.

Timeline of Events

1. 30 July 2022: Preliminary discussions or events related to the restructuring of the parties' business interests.
2. 8 August 2022: Mr Velu, Mr Kumar, SRC, and GTS entered into a Share Swap Agreement (SSA) to split the shareholding and assets of SRC and GTS.
3. 10 August 2022: Date relevant to the performance or implementation of the SSA terms.
4. 11 August 2022: Further dates associated with the transfer of assets or materials under the SSA.
5. 8 November 2023: A point in time where disputes regarding the accounting of receivables or materials began to crystallize.
6. 7 January 2025: GTS commenced Originating Claim No 15 of 2025 (OC 15) against SRC, alleging breaches of the SSA regarding the transfer of scaffold materials and account receivables.
7. 22 January 2025: Procedural milestone in OC 15.
8. 31 January 2025: SRC filed its Defence in OC 15, denying the breaches and raising the issue of the S$200,000 "goodwill" payment.
9. 11 February 2025: Further procedural step in the initial litigation.
10. 11 March 2025: Continued exchange of pleadings or information in OC 15.
11. 24 March 2025: Relevant date in the lead-up to the commencement of the second action.
12. 31 May 2025: SRC commenced Originating Claim No 429 of 2025 (OC 429) against GTS and Mr Kumar.
13. 30 June 2025: GTS and Mr Kumar filed their Defence and Counterclaim in OC 429.
14. 21 August 2025: GTS filed Summons No 2221 of 2025 (SUM 2221) to strike out OC 429.
15. 15 September 2025: First hearing date for the striking out application.
16. 9 October 2025: Second hearing date for the striking out application.
17. 28 October 2025: Final hearing date for the striking out application.
18. 26 December 2025: Date of the judgment delivered by AR Vikram Rajaram.

What Were the Facts of This Case?

The dispute involved two scaffolding companies, Sree Ram Construction Pte Ltd (SRC) and Green Tag Scaffolding Pte Ltd (GTS). Historically, the companies were closely linked through their directors and shareholders. Mr. Velu and Mr. Kumar each held a 50% stake in both SRC and GTS. In 2022, the parties decided to decouple their business interests. This culminated in the execution of a Share Swap Agreement (SSA) on 8 August 2022. The objective of the SSA was to restructure the ownership such that Mr. Velu would become the 100% owner of SRC, while Mr. Kumar would take 100% ownership of GTS. The agreement also provided for the division of assets, specifically scaffolding materials and account receivables, between the two entities.

The relationship soured during the implementation of the SSA. On 7 January 2025, GTS initiated OC 15 against SRC. GTS alleged that SRC had failed to transfer 50% of its scaffold materials and 50% of its account receivables as required by the SSA. GTS further claimed that SRC had failed to provide the necessary accounts and information to facilitate this transfer. In its Defence in OC 15, filed on 31 January 2025, SRC denied these allegations. SRC contended that it had already transferred materials and that GTS was not entitled to the receivables claimed. Crucially, SRC mentioned in its Defence that it had paid S$200,000 to GTS. SRC characterized this as a "goodwill payment" made pursuant to a separate oral agreement between Mr. Velu and Mr. Kumar, rather than a payment for services or a requirement of the SSA itself.

On 31 May 2025, SRC commenced OC 429 against GTS and Mr. Kumar. This second action was significantly broader than the first. SRC’s claims in OC 429 included:

• A claim for S$20,000, representing GTS’s alleged share of SRC’s corporate taxes for the Year of Assessment 2022;
• A claim for S$8,000, representing GTS’s share of costs incurred by SRC in recovering certain account receivables;
• A claim for S$2,000, representing GTS’s share of costs for a professional valuation of scaffold materials;
• An unjust enrichment claim for the return of the S$200,000 "goodwill payment," on the basis that the consideration for the payment (the amicable split) had failed;
• A claim against Mr. Kumar for inducing GTS to breach the SSA; and
• A claim for wrongful interference with SRC’s mobile phone number.

GTS responded by filing SUM 2221 to strike out OC 429. The primary ground for the application was procedural: GTS argued that SRC was required under the ROC 2021 to have brought all these claims as a counterclaim in OC 15. Because SRC had already filed a Defence in OC 15 without a counterclaim, GTS argued that commencing OC 429 was a breach of the rules and an abuse of process. Additionally, GTS targeted the S$200,000 unjust enrichment claim specifically, arguing it was legally flawed because the payment was made in the context of the SSA, and the law generally does not allow unjust enrichment claims where a contract governs the relationship.

The procedural history was further complicated by the fact that GTS had already filed a Defence and Counterclaim in OC 429 before the striking out application was heard. In that counterclaim, GTS sought to recover further materials and receivables, mirroring its claims in OC 15. The court was thus faced with two overlapping actions involving the same parties and the same underlying contract (the SSA), but with different sets of claims and cross-claims.

What Were the Key Legal Issues?

The application raised two primary legal issues that required the court to interpret the ROC 2021 and apply established principles of striking out.

Issue 1: The Mandatory Nature of Counterclaims under ROC 2021
The court had to determine whether Order 6 Rule 8(1) of the ROC 2021 mandates that a defendant must bring all related claims as a counterclaim in the existing action. GTS argued that the change in language from the ROC 2014 (which used "may") to the ROC 2021 (which uses "must") signaled a shift toward a mandatory counterclaim regime. This issue is significant because a mandatory regime would fundamentally change litigation strategy in Singapore, potentially barring any future claims that could have been raised earlier.

Issue 2: Striking Out the Unjust Enrichment Claim
The court had to decide whether SRC’s claim for the return of the S$200,000 payment should be struck out under Order 9 Rule 16. This involved two sub-issues:

• Whether the claim disclosed a reasonable cause of action, given the "contract bar" in unjust enrichment law; and
• Whether the claim was "plainly and obviously unsustainable" or an abuse of process.

This required an analysis of whether the S$200,000 was truly governed by the SSA or a separate "goodwill agreement," and whether such a determination could be made at the interlocutory stage without a full trial.

How Did the Court Analyse the Issues?

Issue 1: Interpretation of Order 6 Rule 8(1) ROC 2021

The court began its analysis by comparing the wording of the ROC 2014 and the ROC 2021. Under the ROC 2014, Order 15 Rule 2 stated that a defendant who "claims any relief... may... add a counterclaim." In contrast, Order 6 Rule 8(1) of the ROC 2021 provides: "If the defendant intends to counterclaim against the claimant, the defendant must file and serve the counterclaim with the defence."

GTS argued that the word "must" imposed a mandatory obligation. However, the court rejected this interpretation. AR Vikram Rajaram reasoned that the "must" is preceded by a conditional clause: "If the defendant intends to counterclaim." This means the obligation to file the counterclaim with the defence only arises if the defendant has already formed the subjective intention to bring a counterclaim. The court noted at [24]:

"The word 'must' in O 6 r 8(1) of the ROC 2021 is conditional on the defendant’s intention. If the defendant does not intend to counterclaim, the 'must' is never triggered. The rules enable but do not compel a defendant to bring a counterclaim."

The court further observed that if the drafters of the ROC 2021 had intended to create a mandatory counterclaim rule—similar to the "compulsory counterclaim" rule in the United States Federal Rules of Civil Procedure—they would have used much clearer and more explicit language. The court also referred to Ram Thayalan Raman Siv and another v Liew Yap Tong [2002] 2 SLR(R) 706, which affirmed that a defendant is generally entitled to bring a separate action rather than a counterclaim, even if the subject matter is related. The court found that the ROC 2021 did not intend to overrule this established principle of Singapore law.

Furthermore, the court addressed the "Ideals" of the ROC 2021 set out in Order 3 Rule 1, which include the "expeditious disposal of cases" and "economical use of resources." While these Ideals encourage the consolidation of related claims, the court held that they do not empower the court to strike out a fresh action simply because it could have been a counterclaim. Instead, the appropriate remedy for any inefficiency caused by separate actions is consolidation (under Order 3 Rule 2) or costs sanctions, rather than the "draconian" measure of striking out a substantive claim.

Issue 2: The Unjust Enrichment Claim

GTS sought to strike out the unjust enrichment claim on the basis that it disclosed no reasonable cause of action. They relied on the principle that unjust enrichment is a subsidiary remedy that generally cannot be invoked when a valid contract (the SSA) covers the same subject matter. GTS cited Ng Chee Tian and another v Ng Chee Pong and others [2025] 3 SLR 235 at [52], which held that "unjust enrichment should only generally be a remedy of last resort."

The court applied the test for striking out from Iskandar bin Rahmat and others v Attorney-General and another [2022] 2 SLR 1018, which requires the court to consider whether the action has "some chance of success" based on the pleadings. The court noted that SRC’s pleaded case was that the S$200,000 was paid pursuant to a separate oral "goodwill agreement" and not the SSA itself. SRC argued that the consideration for this goodwill payment—the "amicable split" of the companies—had failed because GTS had subsequently commenced OC 15.

The court found that this was a triable issue. Whether the S$200,000 was part of the SSA or a separate agreement was a question of fact that could only be determined after hearing evidence at trial. The court stated at [38] that it was not "plainly and obviously unsustainable" for SRC to argue that the SSA did not cover the S$200,000 payment. Therefore, the "contract bar" could not be applied at the striking out stage without first determining the scope of the contract.

Regarding the "abuse of process" argument, the court held that SRC’s failure to bring the claim as a counterclaim in OC 15 did not meet the high threshold for abuse. There was no evidence of "harassment" or "manifest unfairness" to GTS. The court noted that the two actions could be consolidated, which would mitigate any procedural inefficiency. The court also observed that GTS had already filed a Defence and Counterclaim in OC 429, which suggested that the litigation was already progressing and that striking it out would be counterproductive to the Ideals of the ROC 2021.

What Was the Outcome?

The court dismissed the defendants' application (SUM 2221) to strike out OC 429 in its entirety. The court found that SRC was not procedurally barred from commencing a separate action and that the unjust enrichment claim was not suitable for summary dismissal.

The operative paragraph of the judgment states:

"For the reasons set out above, I decided to dismiss SUM 2221 and I awarded costs in favour of SRC fixed at S$6,000, all-in." (at [43])

In addition to dismissing the striking out application, the court made the following consequential orders to manage the litigation:

• Consolidation: The court ordered that OC 15 and OC 429 be consolidated. This means the two actions will be heard together, with the evidence in one being evidence in the other. This was done to satisfy the Ideals of the ROC 2021 regarding the economical use of court resources and the avoidance of inconsistent findings.
• Costs: The court ordered GTS and Mr. Kumar to pay SRC the costs of the application, fixed at S$6,000 inclusive of disbursements. This award reflected the fact that SRC was the successful party in resisting the striking out.
• Procedural Directions: The court directed the parties to file a consolidated set of pleadings or to otherwise streamline the issues for trial, ensuring that the overlapping claims regarding the SSA and the S$200,000 payment are adjudicated in a single forum.

Why Does This Case Matter?

This judgment is of significant importance to Singapore legal practitioners for several reasons, primarily concerning the interpretation of the ROC 2021 and the tactical considerations of counterclaims.

1. Clarification of Order 6 Rule 8(1)
The case provides the first detailed judicial analysis of whether the ROC 2021 introduced mandatory counterclaims. By ruling that the "must" in O 6 r 8(1) is conditional on the defendant's intention, the court has preserved the flexibility of the common law system. Practitioners can take comfort that failing to file a counterclaim in the first instance does not automatically result in the loss of that claim, provided the second action is not an abuse of process. This prevents the ROC 2021 from being used as a "procedural trap" to extinguish substantive rights.

2. Primacy of Substantive Justice over Procedural Formality
The decision reinforces the principle that striking out is a remedy of last resort. Even under the new "Ideals" of the ROC 2021, which emphasize efficiency, the court will not strike out a claim that has a triable basis. The court’s preference for consolidation over striking out shows that procedural efficiency should be achieved through management tools rather than the termination of claims. This aligns with the Court of Appeal's guidance in Iskandar bin Rahmat.

3. The Intersection of Contract and Unjust Enrichment
The judgment highlights the difficulty of striking out unjust enrichment claims where there is a related contract. It confirms that if there is a dispute over whether the contract actually covers the specific payment in question (the "contract bar" issue), the matter must go to trial. This is a reminder to practitioners that the "subsidiary" nature of unjust enrichment is a substantive legal defense that usually requires factual findings, making it difficult to succeed on a striking out application.

4. Guidance on the "Ideals" of ROC 2021
The court’s application of Order 3 Rule 1 (the Ideals) provides a roadmap for how these principles should be used. They are interpretive tools and management guides, not independent grounds for striking out. The court used the Ideals to justify consolidation, demonstrating that the "economical use of resources" can be achieved without depriving a party of their day in court.

5. Impact on Litigation Strategy
For defendants, the case confirms that while it is preferable to counterclaim to save costs and time, there may be strategic reasons to start a separate action (e.g., needing more time to investigate a complex claim or wanting to include additional parties like the 2nd Defendant in this case). However, practitioners should be wary of the costs implications; if a separate action is found to be truly redundant, the court may still impose costs penalties even if it refuses to strike out the claim.

Practice Pointers

• Subjective Intention Triggers the Rule: When advising a defendant, remember that the obligation to file a counterclaim under Order 6 Rule 8(1) only triggers if the defendant intends to do so at the time of filing the Defence. If the intention is formed later, a fresh action or an amendment may be necessary.
• Prefer Consolidation over Striking Out: If faced with a separate action that should have been a counterclaim, the more effective procedural move is often an application for consolidation under Order 3 Rule 2 rather than a striking out application under Order 9 Rule 16. The latter has a much higher threshold and carries a greater risk of adverse costs.
• Plead the "Contract Bar" Carefully: When asserting that an unjust enrichment claim is barred by a contract, ensure that the contract clearly and unambiguously covers the specific obligation or payment. If there is any ambiguity (such as a "goodwill" characterization), the court is likely to find a triable issue.
• Utilize the Ideals: Frame procedural arguments around the Ideals in Order 3 Rule 1. The court in this case explicitly used the Ideals to justify consolidation, showing that judges are highly receptive to arguments based on the "just, expeditious and economical disposal" of the case.
• Costs Risks of Separate Actions: While a separate action may not be struck out, practitioners should warn clients that commencing a fresh action instead of a counterclaim may lead to costs sanctions if the court deems the separate process to have caused unnecessary expense or delay.
• Timing of Striking Out Applications: Note that the defendants in this case filed their Defence and Counterclaim in the second action before the striking out application was heard. This procedural step made it harder to argue that the second action was an "abuse," as the litigation was already well underway.

Subsequent Treatment

As this is a relatively recent decision from late 2025, there is no recorded subsequent treatment in the extracted metadata. However, the ratio—that the ROC 2021 does not mandate counterclaims—is likely to be cited as a foundational interpretation of Order 6 Rule 8. It clarifies a point of potential confusion regarding the shift from "may" to "must" in the new rules, establishing a precedent that favors party autonomy in the commencement of claims over strict procedural compulsion.

Legislation Referenced

• Rules of Court 2021:
  • Order 3 Rule 1 (The Ideals)
  • Order 3 Rule 2 (Court's power to manage cases)
  • Order 6 Rule 8 (Counterclaims)
  • Order 6 Rule 8(1) (Requirement to file counterclaim with defence)
  • Order 9 Rule 16 (Striking out of pleadings and case files)
  • Order 15 Rule 2 (Referenced as the predecessor in ROC 2014)

Cases Cited

• Applied:
  • Iskandar bin Rahmat and others v Attorney-General and another [2022] 2 SLR 1018 (at [17] to [19])
• Referred to / Considered:
  • The “Bunga Melati 5” [2012] 4 SLR 546
  • Ram Thayalan Raman Siv and another v Liew Yap Tong (trading as Tong Heng Motor Work) [2002] 2 SLR(R) 706
  • Terrestrial Pte Ltd v Allgo Marine Pte Ltd and another and another appeal [2013] 3 SLR 527
  • Ng Chee Tian and another v Ng Chee Pong and others [2025] 3 SLR 235 (at [52])
  • [2025] SGHCR 39

Source Documents

• Original Judgment (PDF)
• eLitigation Case Page