SREE RAM CONSTRUCTION PTE LTD v GREEN TAG SCAFFOLDING PTE LTD & Anor

Case Details

• Citation: [2025] SGHCR 39
• Court: General Division of the High Court
• Decision Date: 26 December 2025
• Coram: Vikram Rajaram JC
• Case Number: Originating Claim No 429 of 2025; Summons No 2221 of 2025
• Hearing Date(s): 15 September, 9 and 28 October 2025
• Claimants / Plaintiffs: Sree Ram Construction Pte Ltd (“SRC”)
• Respondent / Defendant: Green Tag Scaffolding Pte Ltd (“GTS”); Mani Senthil Kumar (“Mr Kumar”)
• Counsel for Claimants: Celine Liow Wan-Ting (Forte Law LLC)
• Counsel for Respondent: Low Shauna (Jacob Mansur & Pillai)
• Practice Areas: Civil Procedure; Pleadings; Striking out

Summary

In Sree Ram Construction Pte Ltd v Green Tag Scaffolding Pte Ltd & Anor [2025] SGHCR 39, the High Court addressed a fundamental procedural question regarding the mandatory or permissive nature of counterclaims under the Rules of Court 2021 (“ROC 2021”). The dispute arose when the defendants (the “GTS Group”) sought to strike out an entire action brought by the claimant (“SRC”) on the basis that the claims therein ought to have been brought as a counterclaim in a prior, related action (HC/OC 15/2025, or “OC 15”). The central legal controversy centered on the interpretation of Order 6 Rule 8(1) of the ROC 2021, which employs the word “must” in relation to the filing of counterclaims, leading the defendants to argue that the new rules had effectively abolished the right of a defendant to commence a separate fresh claim for matters that could have been counterclaimed in an existing suit.

The court dismissed the striking out application, providing a definitive ruling that the ROC 2021 does not mandate that a defendant bring all claims against a claimant as a counterclaim. Assistant Registrar Vikram Rajaram held that the rules “enable but do not compel a defendant to bring a counterclaim” (at [1]). This decision preserves the long-standing principle that while the court encourages the consolidation of related disputes to serve the interests of efficiency and economy, a party is not procedurally barred from initiating a separate action merely because the subject matter overlaps with an existing suit where they are the defendant. The court emphasized that the proper remedy for such overlaps is case management and consolidation, rather than the draconian measure of striking out a claim as an abuse of process.

Beyond the procedural interpretation of the ROC 2021, the judgment also delved into the substantive requirements for striking out a claim for unjust enrichment. The GTS Group had specifically targeted SRC’s restitutionary claim for a S$200,000 payment, arguing it was factually unsustainable and disclosed no reasonable cause of action. The court applied the established tests for striking out, reaffirming that a claim will only be struck out if it is “plainly or obviously unsustainable.” Given the existence of competing factual narratives regarding the purpose of the S$200,000 payment—whether it was a “goodwill payment” or a payment for scaffolding services that were never rendered—the court determined that the matter required a full trial and could not be disposed of summarily.

This case serves as a critical guide for practitioners navigating the transition from the 2014 Rules to the ROC 2021. It clarifies that the “Ideals” of the ROC 2021—specifically the promotion of efficient and economical dispute resolution—do not override the substantive right of a party to choose the forum and timing of their claims, provided such conduct does not cross the threshold into a genuine abuse of the court’s process. The decision reinforces the high bar for striking out and the court's preference for active case management over the termination of proceedings on technical procedural grounds.

Timeline of Events

1. 29 December 2017: Date referenced in the background of the corporate relationships between the parties.
2. 30 July 2022: Preliminary date leading up to the restructuring of the parties' business interests.
3. 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 such that Mr Velu would own 100% of SRC and Mr Kumar would own 100% of GTS.
4. 10 August 2022: GTS allegedly invoiced SRC for S$200,000 for scaffolding-related services.
5. 11 August 2022: SRC transferred S$200,000 to GTS; the nature of this payment (goodwill vs. services) became a central point of contention.
6. 8 November 2023: A date relevant to the ongoing disputes regarding the implementation of the SSA.
7. 7 January 2025: GTS commenced HC/OC 15/2025 (“OC 15”) against SRC for alleged breaches of the SSA, specifically regarding the distribution of scaffold materials and accounts receivables.
8. 22 January 2025: Procedural milestone in the early stages of OC 15.
9. 31 January 2025: Further developments in the pleadings or service of process for OC 15.
10. 11 February 2025: Date related to the response or defense in the OC 15 proceedings.
11. 11 March 2025: Continued procedural activity in the related litigation.
12. 24 March 2025: Further date in the timeline of the OC 15 dispute.
13. 31 May 2025: SRC commenced the present action, HC/OC 429/2025 (“OC 429”), against the GTS Group.
14. 30 June 2025: Procedural development following the commencement of OC 429.
15. 21 August 2025: Filing of the striking out application (SUM 2221) by the GTS Group.
16. 9 September 2025: Filing of the 1st Affidavit of Mani Senthil Kumar in support of the striking out application.
17. 12 September 2025: Filing of further evidence or submissions prior to the first hearing date.
18. 15 September, 9 and 28 October 2025: Substantive hearing dates for the striking out application before the Assistant Registrar.
19. 26 December 2025: Delivery of the judgment dismissing the striking out application.

What Were the Facts of This Case?

The dispute involved two companies in the scaffolding services industry: Sree Ram Construction Pte Ltd (“SRC”) and Green Tag Scaffolding Pte Ltd (“GTS”). Historically, the companies were linked through shared ownership and directorship. Mr. Kulandaivelu Chidambaram (“Mr Velu”) and Mr. Mani Senthil Kumar (“Mr Kumar”) each held 50% of the shares in both SRC and GTS and served as directors for both entities. This arrangement continued until 2022, when the parties decided to decouple their business interests.

On 8 August 2022, Mr Velu, Mr Kumar, SRC, and GTS executed a Share Swap Agreement (“SSA”). The primary objective of the SSA was to restructure the entities so that Mr Velu would become the sole (100%) owner of SRC, while Mr Kumar would become the sole (100%) owner of GTS. The SSA contained several critical clauses governing the division of assets and liabilities. Clause 3.1 required the parties to split scaffold materials, with GTS entitled to 50% of the materials. Clause 4.1(a) concerned accounts receivables, stipulating that SRC would assign 50% of its receivables to GTS. Conversely, Clause 4.1(d) provided that GTS would be responsible for 50% of SRC’s corporate tax for the financial year 2022 and 50% of the costs incurred by SRC in recovering the accounts receivables.

The relationship soured shortly after the execution of the SSA, leading to two separate but related Originating Claims. The first, OC 15, was filed by GTS against SRC on 7 January 2025. In OC 15, GTS alleged that SRC had breached the SSA by failing to provide the full 50% share of scaffold materials and failing to assign the 50% share of accounts receivables. Notably, in its Statement of Claim for OC 15, GTS also pleaded that SRC had transferred S$200,000 to GTS on 11 August 2022. GTS characterized this payment as being made “pursuant to an agreement” between Mr Velu and Mr Kumar, though the specific nature of that agreement was not detailed in the GTS pleading.

SRC filed its defense in OC 15, denying the breaches. Regarding the S$200,000 payment, SRC’s position in OC 15 was that the payment was a “goodwill payment” from Mr Velu to Mr Kumar, evidenced by a handwritten agreement dated 30 July 2022. SRC further alleged that GTS had issued an invoice dated 10 August 2022 for “scaffolding-related services” to facilitate this payment, but SRC maintained that no such services were ever intended or provided. Crucially, SRC did not file a counterclaim in OC 15 at that time, though it “reserved its right” to claim the S$200,000 back from GTS.

On 31 May 2025, SRC commenced the second action, OC 429, against GTS and Mr Kumar (the “GTS Group”). SRC’s claims in OC 429 were significantly broader than the issues in OC 15. They included:

• Breach of Clause 4.1(d) of the SSA regarding corporate tax and recovery costs;
• Inducement of breach of contract involving a third party, Firstpiping Engineering Pte Ltd;
• Wrongful interference and breach of fiduciary duties related to the transfer of SRC’s mobile phone number;
• Conspiracy to injure SRC by unlawful means; and
• A restitutionary claim for the return of the S$200,000 payment (the “Unjust Enrichment Claim”).

In OC 429, SRC’s framing of the S$200,000 payment shifted. It pleaded that the payment was made pursuant to the GTS invoice for scaffolding services, but since those services were never provided, there was a total failure of consideration, or the agreement was invalid for want of consideration. Consequently, SRC argued that GTS had been unjustly enriched. The GTS Group responded by filing SUM 2221, seeking to strike out the entirety of OC 429 on procedural grounds and the Unjust Enrichment Claim on substantive grounds.

What Were the Key Legal Issues?

The application raised two primary legal issues, one procedural and one substantive, both of which required the court to interpret the boundaries of the ROC 2021.

Issue 1: The Mandatory Nature of Counterclaims under ROC 2021
The first issue was whether the entire action in OC 429 should be struck out because SRC failed to bring its claims as a counterclaim in OC 15. The GTS Group relied on Order 6 Rule 8(1) of the ROC 2021, which states that a defendant who intends to counterclaim “must” file the counterclaim at the time they file their defense. The defendants argued that this language, coupled with the ROC 2021 “Ideals” of efficiency and economy, mandated that all related claims be brought in a single action. They contended that commencing a fresh action (OC 429) instead of a counterclaim in OC 15 was a breach of the rules and an abuse of process. The court had to determine if the word “must” in O 6 r 8(1) changed the law from the previous 2014 Rules, which were understood to be permissive regarding counterclaims.

Issue 2: The Sustainability of the Unjust Enrichment Claim
The second issue was whether SRC’s claim for the restitution of the S$200,000 payment should be struck out under Order 9 Rule 16 of the ROC 2021. The GTS Group argued that the claim disclosed no reasonable cause of action and was factually unsustainable. They pointed to what they perceived as inconsistencies in SRC’s narrative—specifically, SRC’s characterization of the payment as a “goodwill payment” in OC 15 versus a payment for “services” (subject to a failure of consideration) in OC 429. The court had to decide if SRC’s pleaded case for unjust enrichment was “plainly or obviously unsustainable” or if it presented a triable issue that required the examination of evidence at trial.

How Did the Court Analyse the Issues?

The court’s analysis began with a deep dive into the interpretation of Order 6 Rule 8(1) of the ROC 2021. The GTS Group’s primary submission was that the ROC 2021 had introduced a paradigm shift. They argued that while the Rules of Court 2014 (“ROC 2014”) used permissive language, the ROC 2021 used mandatory language (“must”). They further cited the “Ideals” set out in Order 3 Rule 1 of the ROC 2021, which include the expeditious resolution of disputes and the economical use of court resources. According to the defendants, allowing SRC to maintain OC 429 would result in a duplication of resources and the risk of inconsistent findings, thereby violating these Ideals.

Assistant Registrar Vikram Rajaram rejected this interpretation. He noted that while O 6 r 8(1) states a defendant “must” file a counterclaim with the defense, this obligation is conditional: it only applies if the defendant “intends to counterclaim.” The court reasoned that the rule regulates the timing and manner of filing a counterclaim once the decision to counterclaim has been made; it does not mandate the decision itself. The court held:

“the rules enable but do not compel a defendant to bring a counterclaim.” (at [1])

The court further observed that if the drafters of the ROC 2021 had intended to create a mandatory counterclaim rule—a significant departure from common law tradition—they would have done so explicitly. The court compared the Singapore position with other jurisdictions and found no evidence that the ROC 2021 intended to follow a “compulsory counterclaim” model. The Assistant Registrar emphasized that the Ideals are meant to guide the court’s discretion in case management, not to serve as a blunt instrument to strike out substantive claims. The appropriate response to overlapping actions is consolidation under Order 7, not striking out under Order 9.

Regarding the second issue—the striking out of the Unjust Enrichment Claim—the court applied the test from The “Bunga Melati 5” [2012] 4 SLR 546. An action is only struck out if it is “plainly or obviously unsustainable,” meaning it is either legally unsustainable (disclosing no cause of action) or factually unsustainable (where the facts alleged could not possibly be proven). The court also referenced Iskandar bin Rahmat and others v Attorney-General and another [2022] 2 SLR 1018 at [17]-[19] for the applicable tests under each limb of the striking out rule.

The GTS Group argued that SRC’s claim was legally defective because it failed to satisfy the requirements for unjust enrichment, particularly the “at the expense of” and “unjust factor” elements. They also argued it was factually unsustainable because SRC had previously called the S$200,000 a “goodwill payment.” However, the court found that SRC had pleaded a coherent, albeit contested, case:

1. GTS was enriched by the S$200,000;
2. The enrichment was at SRC’s expense;
3. The “unjust factor” was a total failure of consideration (or lack of consideration) because the scaffolding services described in the invoice were never provided.

The court noted that GTS’s own pleading in OC 15 admitted the payment was made “pursuant to an agreement.” This admission created a factual dispute about what that agreement actually was. If the agreement was for services (as the invoice suggested) and those services were not provided, a claim for unjust enrichment is legally viable. The court held that it could not resolve this factual dispute on a striking out application. The Assistant Registrar also addressed the GTS Group’s reliance on Ng Chee Tian and another v Ng Chee Pong and others [2025] 3 SLR 235, noting that while unjust enrichment should not generally be used to override a valid contract, the very validity and nature of the contract in this case were the points in contention.

Finally, the court addressed the allegation of abuse of process. The GTS Group argued that SRC was taking inconsistent positions. The court found that while SRC’s explanations for why it did not counterclaim in OC 15 were “not entirely consistent,” this did not reach the level of an abuse of process. The court noted that SRC had consistently flagged its intention to seek the return of the S$200,000. The commencement of a separate action, while perhaps less efficient than a counterclaim, did not constitute an attempt to re-litigate a decided issue or an act of harassment that would justify striking out.

What Was the Outcome?

The court dismissed the GTS Group’s application to strike out OC 429 in its entirety and the specific application to strike out the Unjust Enrichment Claim. The operative conclusion of the court was that the ROC 2021 does not impose a mandatory requirement for a defendant to bring all related claims via a counterclaim in an existing action.

The court’s orders were as follows:

• The application in SUM 2221 was dismissed.
• The claims in OC 429, including the Unjust Enrichment Claim, were allowed to proceed to trial.
• The court awarded costs in favor of SRC.

Regarding costs, the court considered the complexity of the procedural arguments and the duration of the hearings (which spanned three separate dates). The court ordered the GTS Group to pay SRC the costs of the application, which were fixed at S$6,000 all-in. The court’s operative paragraph stated:

“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])

The dismissal of the striking out application means that both OC 15 and OC 429 will continue. The court noted that the parties could, and perhaps should, seek to consolidate the two actions to ensure they are heard together, thereby satisfying the ROC 2021 Ideals of efficiency and avoiding inconsistent findings. However, the choice to consolidate remains a matter of case management rather than a prerequisite for the survival of the claim.

Why Does This Case Matter?

This decision is a significant milestone in the interpretation of the ROC 2021, specifically regarding the autonomy of litigants in framing their claims. For practitioners, the case provides much-needed clarity on Order 6 Rule 8(1). The GTS Group’s argument—that the word “must” created a mandatory counterclaim rule—was a plausible reading of the text that had caused some uncertainty in the legal community. By clarifying that the rule is permissive rather than compulsory, the High Court has preserved the flexibility of defendants to decide whether to counterclaim or initiate separate proceedings.

The judgment also reinforces the hierarchy of the ROC 2021 Ideals. While the Ideals (Order 3 Rule 1) are central to the new procedural framework, they do not create new substantive bars to litigation. The court’s reasoning suggests that the Ideals are primarily tools for the court to use in managing litigation (e.g., through consolidation or cost penalties) rather than grounds for terminating litigation. This distinction is vital for maintaining access to justice and ensuring that parties are not deprived of their day in court due to procedural choices that, while perhaps inefficient, do not amount to an abuse of process.

In the realm of unjust enrichment, the case highlights the difficulty of striking out restitutionary claims where the underlying contractual basis is disputed. The court’s refusal to strike out the claim despite the “goodwill payment” narrative in the related action shows a commitment to the principle that striking out is a remedy of last resort. It signals that where there is a “triable issue” regarding the purpose of a payment and the existence of consideration, the court will favor a full evidentiary hearing over summary disposal.

Furthermore, the case provides a practical example of how the court handles “inconsistent” pleadings across different actions. It suggests that unless the inconsistency is so blatant as to render the claim “plainly unsustainable” or is part of a broader pattern of abusive conduct, the court will allow the claims to proceed. This is particularly relevant in complex commercial disputes where parties may refine their legal theories as more facts come to light or as they engage different counsel.

Finally, the decision serves as a reminder of the importance of the Bunga Melati 5 threshold. Even under the ROC 2021, which emphasizes speed and efficiency, the high bar for striking out remains intact. Practitioners should be cautious about filing striking out applications that rely on factual disputes or nuanced interpretations of procedural rules, as the court remains inclined to allow substantive disputes to be resolved on their merits.

Practice Pointers

• Counterclaim Strategy: While O 6 r 8(1) is not mandatory, practitioners should still favor counterclaims for related disputes to align with the ROC 2021 Ideals. Failure to do so may not lead to striking out, but it could result in adverse cost consequences or the court ordering consolidation anyway.
• Interpreting "Must": When the ROC 2021 uses "must," check if the obligation is conditional. In O 6 r 8(1), the "must" only triggers once the intent to counterclaim is formed.
• Striking Out Threshold: Do not rely on the ROC 2021 Ideals to lower the threshold for striking out. The "plainly or obviously unsustainable" test from Bunga Melati 5 continues to apply with full force.
• Pleading Unjust Enrichment: When pleading unjust enrichment in the face of a potential contract, ensure the pleading addresses why the contract does not bar the claim (e.g., total failure of consideration or invalidity for want of consideration).
• Consistency Across Actions: Be mindful of narratives in related proceedings. While the court in this case was lenient regarding SRC's "goodwill" vs. "services" shift, significant inconsistencies can still be used to argue factual unsustainability.
• Case Management over Striking Out: If a client is faced with a separate action that should have been a counterclaim, the more effective and safer procedural route is an application for consolidation or a stay, rather than a striking out application.
• Costs of Interlocutory Applications: Note the court's willingness to award "all-in" costs (S$6,000 in this case) for multi-day interlocutory hearings, reflecting the work required to address complex procedural interpretations.

Subsequent Treatment

As a 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 expected to be followed as a foundational interpretation of Order 6 Rule 8(1), providing a clear precedent for future striking out applications based on similar procedural grounds.

Legislation Referenced

• Rules of Court 2021, Order 3 Rule 1 (The Ideals)
• Rules of Court 2021, Order 3 Rule 2
• Rules of Court 2021, Order 6 Rule 8(1) (Counterclaims)
• Rules of Court 2021, Order 9 Rule 16 (Striking out)
• Rules of Court 2021, Order 15 Rule 2
• Rules of Court 2014 (referenced for historical comparison)

Cases Cited

• Applied:
  • Iskandar bin Rahmat and others v Attorney-General and another [2022] 2 SLR 1018
  • The “Bunga Melati 5” [2012] 4 SLR 546
• Referred to:
  • 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

Source Documents

• Original Judgment PDF (2025_SGHCR_39)
• eLitigation Case Link