Mansource Interior v CSG Group: Overpayment Dispute in Construction Subcontracts

In a suit before the High Court of Singapore, Mansource Interior Pte Ltd sued CSG Group Pte Ltd, seeking $904,530.53 for overpayment under two subcontracts for a Changi Business Park project. CSG Group counterclaimed for variations. Justice Vinodh Coomaraswamy ruled in favor of Mansource Interior, finding that they had overpaid CSG Group and dismissing CSG Group's counterclaim in its entirety. The court determined that the subcontracts were re-measurement contracts and that Mansource Interior's re-measurements were accurate.

1. Case Overview

1.1 Court

High Court of the Republic of Singapore

1.2 Outcome

Judgment for Plaintiff

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

The High Court found Mansource Interior overpaid CSG Group under two subcontracts and dismissed CSG Group's counterclaim for variations.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Mansource Interior Pte LtdPlaintiff, Defendant in CounterclaimCorporationJudgment for PlaintiffWon
CSG Group Pte LtdDefendant, Plaintiff in CounterclaimCorporationCounterclaim DismissedLost
A Rajandran of A Rajandran

3. Judges

Judge NameTitleDelivered Judgment
Vinodh CoomaraswamyJudgeYes

4. Counsels

Counsel NameOrganization
Edwin LeeEldan Law LLP
Poonaam BaiEldan Law LLP
Charles TayEldan Law LLP
A RajandranA Rajandran

4. Facts

  1. Mansource Interior was awarded a subcontract by Shimizu Corporation for interior fitting out works at Changi Business Park.
  2. Mansource Interior subcontracted wall finishes and joinery work to CSG Group via two re-measurement subcontracts.
  3. The wall finishes subcontract was valued at $1,252,750, and the joinery subcontract at $1,550,000.
  4. CSG Group served payment claims on Mansource Interior for both subcontracts in August 2013.
  5. CSG Group obtained adjudication determinations in its favor for both subcontracts in September 2013.
  6. Mansource Interior commenced an action claiming overpayment to CSG Group under both subcontracts.
  7. The subcontracts contained a clause requiring main contractor approval for variation works.

5. Formal Citations

  1. Mansource Interior Pte Ltd v CSG Group Pte Ltd, Suit No 1155 of 2013, [2017] SGHC 41

6. Timeline

DateEvent
Shimizu Corporation Pte Ltd awarded Mansource Interior Pte Ltd the subcontract for interior fitting out works for a section of the Changi Business Park project.
Mansource Interior Pte Ltd subcontracted the wall finishes work and the joinery work for the same section of the project to CSG Group Pte Ltd.
CSG Group Pte Ltd served on Mansource Interior Pte Ltd a payment claim under the wall finishes subcontract for the sum of $322,536.65.
CSG Group Pte Ltd served on Mansource Interior Pte Ltd a payment claim under the joinery subcontract for the sum of $324,812.68.
Mansource Interior Pte Ltd certified the sum of $93,732.10 for the wall finishes subcontract.
CSG Group Pte Ltd made an adjudication application under the Building and Construction Industry Security of Payment Act for the sum of $228,804.55 said to be due under the wall finishes contract.
CSG Group Pte Ltd made an adjudication application under the Building and Construction Industry Security of Payment Act for the sum of $268,544.78 said to be due under the joinery subcontract.
CSG Group Pte Ltd obtained an adjudication determination in its favour in the sum of $223,956.50 for wall finishes work.
CSG Group Pte Ltd obtained an adjudication determination in its favour in the sum of $296,719.58 for joinery work.
Mansource Interior Pte Ltd commenced action claiming that the final account between the parties showed that the plaintiff had paid the defendant under each subcontract more than the defendant was contractually entitled to.
Trial began
Trial
Trial
Trial
Trial
Trial
Trial
Judgment issued

7. Legal Issues

  1. Overpayment Under Subcontracts
    • Outcome: The court found that Mansource Interior had overpaid CSG Group under both subcontracts.
    • Category: Substantive
  2. Breach of Contract
    • Outcome: The court found that CSG Group was in breach of contract.
    • Category: Substantive
  3. Estoppel by Convention
    • Outcome: The court found that Mansource Interior was not estopped from relying on the re-measurement clause in the wall finishes subcontract.
    • Category: Substantive
  4. Variation Claims
    • Outcome: The court dismissed CSG Group's counterclaim for variation works, finding that the main contractor did not authorize or approve the variations.
    • Category: Substantive
  5. Pay When Paid Provisions
    • Outcome: The court held that Section 9 of the Building and Construction Industry Security of Payment Act did not render void any of the contractual provisions on which the plaintiff relies.
    • Category: Substantive

8. Remedies Sought

  1. Monetary Damages

9. Cause of Actions

  • Breach of Contract
  • Overpayment

10. Practice Areas

  • Construction Law
  • Commercial Litigation

11. Industries

  • Construction

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
China Construction (South Pacific) Development Co Pte Ltd v Spandeck Engineering (S) Pte LtdHigh CourtYes[2005] SGHC 86SingaporeCited regarding the interpretation of a contract based on the course of dealing between parties.
Amalgamated Investment & Property Co Ltd v Texas Commerce International Bank LtdN/AYes[1982] QB 84N/ACited regarding the interpretation of a contract based on the course of dealing between parties.
MAE Engineering Ltd v Fire-Stop Marketing Services Pte LtdCourt of AppealYes[2005] 1 SLR(R) 379SingaporeCited for the requirements of estoppel by convention.
LW Infrastructure Pte Ltd v Lim Chin San Contractors Pte LtdN/AYes[2011] 4 SLR 477SingaporeCited regarding the nature of interim certificates in construction contracts.
Rudhra Minerals Pte Ltd v MRI Trading Pte Ltd (formerly known as CWT Integrated Services Pte Ltd)Court of AppealYes[2013] 4 SLR 1023SingaporeCited regarding the principle that estoppel cannot be used as a cause of action.
Sea-Land Service Inc v Cheong Fook Chee VincentCourt of AppealYes[1994] 3 SLR(R) 250SingaporeCited regarding the principle that promissory estoppel can only be used as a shield and not as a sword.
Hi-Amp Engineering Pte Ltd v Technicdelta Electrical Engineering Pte LtdHigh CourtYes[2003] SGHC 316SingaporeDistinguished regarding the applicability of back-to-back clauses in subcontracts.
GIB Automation Pte Ltd v Deluge Fire Protection (SEA) Pte LtdN/AYes[2007] 2 SLR(R) 918SingaporeCited regarding the applicability of back-to-back clauses in subcontracts.
Ong Seow Pheng and others v Lotus Development Corp and anotherN/AYes[1997] 2 SLR(R) 113SingaporeCited regarding the principle that a court cannot award compensation on a cause of action that has not been pleaded.
Maryani Sadeli v Arjun Permanand Samtani and another and other appealsCourt of AppealYes[2015] 1 SLR 496SingaporeCited regarding the recovery of costs of previous legal proceedings as damages in subsequent proceedings.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
Building and Construction Industry Security of Payment Act (Cap 30B, 2006 Rev Ed)Singapore
Building and Construction Industry Security of Payment Act, Section 9Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • Re-measurement contract
  • Subcontract
  • Variation works
  • Adjudication determination
  • Payment claim
  • Back-to-back contract
  • Interim certificate
  • Final account
  • Retention sum
  • As-built drawings

15.2 Keywords

  • Construction subcontract
  • Overpayment
  • Re-measurement contract
  • Variation claim
  • Building and Construction Industry Security of Payment Act
  • Singapore High Court

17. Areas of Law

Area NameRelevance Score
Construction Law95
Building and Construction Law90
Building and Construction Industry Security of Payment Act 200490
Building and Construction Contracts90
Measurement contracts80
Claims by sub-contractor80
Breach of Contract30
Contract Law30
Workplace Safety and Health20
Commercial Law20
Summary Judgement10
Civil Procedure10

16. Subjects

  • Construction Dispute
  • Contract Law
  • Building and Construction Industry Security of Payment Act