Full Support Healthcare Limited v Smart Glove International Pte. Ltd.

During the COVID-19 pandemic, Full Support Healthcare Ltd (FSH), a seller of protective equipment, contracted with Smart Glove International Pte Ltd (SGI) for some two billion gloves. A Supply Agreement of 11 June 2020 was followed by a 1st PO, a 5mil PO and a 2nd PO, under which FSH paid 80% of each tranche in advance. SGI's deliveries were late from the outset, and FSH agreed to each revised schedule. It also accepted six price increases, the price of the 3mil gloves rising from US$82.50 to US$104.20 per 1,000 by April 2021.

When market prices fell, FSH's email of 20 April 2021 cancelled all existing 3mil orders because it could not sell the gloves at the agreed price, and a further email of 6 July 2021 cancelled all open orders and sought a refund. SGI sued in HC/S 49/2022 and FSH counterclaimed. The High Court judge found that SGI repudiated the contract by failing to use all reasonable endeavours to deliver on time, and that FSH could rely on that breach to justify termination on 6 July 2021, though it had itself renounced the contract in the interim. She awarded FSH US$51,239,650.02 for late delivery, ordered refund of US$64,782,300 in advance payments with interest, and gave SGI limited damages. Both parties appealed in AD/CA 101/2025 and AD/CA 102/2025.

1. Whether SGI breached the Supply Agreement through its delays, its price increases and its delay in supplying certificates
2. Whether FSH could rely on SGI's unstated repudiatory breach to justify cancelling the orders
3. Whether FSH had waived its right to terminate and its right to damages for SGI's delays
4. Whether the advance payments were forfeitable deposits and what remedies each party should receive

The court upheld the finding that SGI repudiated the agreement by overselling its capacity and diverting production. But it held that the price increases were not breaches: the price clause required only that both parties agree that extenuating circumstances warranted a change, and FSH's agreement to each increase was conclusive. Nothing turned on the certificates, which were supplied before termination and caused no proven loss.

The court accepted that the principle in Alliance Concrete Singapore Pte Ltd v Comfort Resources Pte Ltd [2009] 4 SLR(R) 602 could apply even though FSH's emails cited only price and amounted to a renunciation, because it asks whether a right to terminate existed, not what the party intended. The principle was, however, displaced by waiver. From June 2020 to April 2021 FSH accepted every late delivery and revised schedule without reserving its rights, admitted making a commercial decision to continue, and never cited the delays when cancelling. That was an unequivocal representation that it would not terminate for the delays, on which SGI relied by continuing to perform. Actual knowledge is not required for waiver by estoppel, and in any case FSH knew of the delays.

The court held, as an exceptional case, that FSH had also waived its right to damages. By placing new orders in August and November 2020 knowing the delays would likely continue, and without reserving its rights, FSH led SGI to take on more exposure. The no-waiver clause did not help FSH because the waiver rested on positive acts, not mere delay. FSH's cancellation was therefore an unjustified renunciation.

Applying Li Jialin and another v Wingcrown Investment Pte Ltd [2024] 2 SLR 372, the advance payments were not forfeitable: there was no right of forfeiture, the set-off clause pointed the other way, and 80% was not reasonable as an earnest. No interest was due because SGI need not repay until FSH's entitlement was determined. SGI was entitled to the contract price of the produced gloves, since its liability to the manufacturers was an existing one, less mitigation proceeds of US$2,000,414.50. Its storage costs and cancelled-order claims failed for want of proof of loss.

The Appellate Division dismissed FSH's appeal and allowed SGI's appeal in part. The award of US$51,239,650 to FSH for late delivery and the pre-judgment interest on the refund were set aside. The advance payments remained refundable, but SGI's damages for produced but undelivered gloves were increased to US$7,644,233.30, leaving a net refund to FSH of US$52,010,681.90 after set-off. FSH was ordered to pay SGI costs of $41,000 and $70,000 for the two appeals and $165,000 for the proceedings below.