TERRENUS ENERGY SL2 PTE LTD v ATTIKA INTERIOR + MEP PTE LTD

Facts

Terrenus Energy SL2 Pte Ltd (Terrenus) engaged Attika Interior + MEP Pte Ltd (Attika) under a contract dated 5 April 2021 as main contractor to install, test and commission a ground-mounted solar farm and a linkway solar facility at Changi Business Park, for a lump sum of $5,100,000. Attika had to energise at least 70% of the solar farm by 30 June 2021 (Partial Completion) and complete by 31 July 2021. Terrenus supplied the panels and, through its subcontractor Bulox, the two substations. Terrenus granted none of Attika's requests for extensions of time. After the Temporary Occupation Permit issued, Terrenus terminated Attika's employment on 3 February 2022 on a without default basis.

In HC/S 173/2022 Terrenus claimed damages for three alleged substantial defects (insufficient embedment of the mounting rods, insufficient ground clearance, and failure to remove tree root balls), liquidated damages for delay, and general damages including sums it said it owed under a Renewable Energy Purchase Agreement with a Meta subsidiary. Attika claimed extensions of time and counterclaimed the unpaid Balance Sum of $3,139,836.60.

Issues

1. Whether Attika delivered works with substantial defects entitling Terrenus to substantial damages.
2. Whether Attika was entitled to extensions of time, and when Partial Completion and completion were achieved.
3. Whether Terrenus could recover liquidated damages and further general damages for delay.
4. Whether Attika was entitled to the Balance Sum under cl 14.3.2 after termination without default.

Holding

Kwek Mean Luck J allowed Terrenus's claims in part, awarding nominal damages of $1,500 for each of the embedment and clearance breaches, $912 for six insufficiently ground roots and $30,600 in liquidated damages, a total of $34,512. Attika's counterclaim succeeded: it was awarded the Balance Sum less deductions of $49,861 and US$85,920.90 for claims headed to neutral evaluation, with pre-judgment interest at 3.1% from 2 April 2022. Indemnity costs were refused.

Reasoning

On defects, the court stressed that Terrenus bore the burden of proving the extent of non-compliance and its loss. The so-called joint inspection reports had been prepared by Terrenus alone, the photographs had measurement problems and could not be matched to marked panels, and its expert's extrapolation from an assumed slope was conjecture. The experts agreed that wind speeds at panel height would be below the 20m/s design figure, and the mounting supplier's email cast doubt on whether any shortfall below 500mm created a structural risk, so only nominal damages were due. The clearance claim also failed for lack of proof, and the loss said to arise from being unable to use the Raymo grass-cutting robot was too remote and unmitigated. Clause 5.2.1 did not require roots to be grubbed out; grinding to 150-200mm sufficed, and only six roots fell short.

On delay, the court relied on the commissioning documents and found that Partial Completion and completion were both achieved on 23 November 2021. It rejected Terrenus's delay expert's linear-progress method and found 140 days of extension due to delays attributable to Terrenus: the NParks approval, late panel delivery, and Bulox's substation installation and rectification. That left six days of liquidated damages at $5,100 a day, and the clause was not a penalty. Under Chan Ah Beng, general damages for delay could not be added to liquidated damages, and the Meta-related claims would in any case have failed on causation and remoteness.

On the counterclaim, cl 14.3.2 did not import the payment milestones in Annex F. Terrenus had admittedly failed to certify, the Works were completed, and Attika could sue for the agreed lump sum, subject only to deductions related to the works.

From the judgment