1 The plaintiff, Sunrise Industries (India) Ltd (“Sunrise”), is a company registered in India. Sunrise is in the business of manufacturing thermosets, thermoplastic-lined equipment, pipes and fittings. ¹ The first defendant, PT. OKI Pulp & Paper Mills (“OKI”), is a company incorporated in Indonesia. OKI is in the business of manufacturing pulp, paper and tissue paper. ²

2 Sunrise and OKI agreed that Sunrise would supply and install pipes, fittings and manholes for a new pump mill owned by OKI on an island in Indonesia (the “Mill”). ³ Sunrise was obliged to and did procure a bank guarantee with the second defendant, Dena Bank Limited (“Dena Bank”), a public bank in India. ⁴ Disputes arose in the performance of these contracts. Eventually OKI invoked the bank guarantee. Sunrise brought this suit thereafter.

3 Parties structured their transaction in relation to OKI’s pump mill in two contracts. The first was “Purchase Contract for Delivery of A Complete Sets of FRP-Piping” (sic) dated 10 July 2015 (the “Supply Contract”). ⁵ Under this contract, Sunrise was to supply OKI with goods including pipes, fittings and manholes. The contract value of the Supply Contract was initially US$6,647,625. ⁶ The Supply Contract was amended twice. On 14 September 2015, parties signed the first amendment agreement ( “Supply Contract A1”). ⁷ Supply Contract A1 reduced the scope of goods that were to be supplied, but increased the contract value to US$6,925,838. ⁸ On 10 November 2015, parties signed a second amendment agreement (“Supply Contract A2”). ⁹ Under Supply Contract A2, OKI ordered additional goods, and the value of the Supply Contract rose to US$8,324,131. ¹⁰ Parties do not dispute these amendment agreements. Thus, when I refer to the Supply Contract, unless otherwise specified, I am referring to the Supply Contract incorporating both Supply Contract A1 and Supply Contract A2. I will refer to the goods that were to be supplied under the Supply Contract as the Goods.

4 The contract price of the Supply Contract was to be paid by OKI to Sunrise in the following manner: 10% was to be paid 15 days after the signing of the agreements and OKI’s receipt of Sunrise’s invoice and bank guarantee; 80% was to be paid by letter of credit issued by OKI; and the final 10% was to be paid after OKI’s issuance of a Certificate of Performance Test Acceptance to Sunrise. ¹¹

5 The second contract was “Purchase Contract for Supervision and Installation Work of A Complete Set of FRP-Piping”, also dated 10 July 2015 (the “Installation Contract”). ¹² Under the Installation Contract, Sunrise was to install the Goods for use in the Mill. The contract value was initially US$1,291,935, ¹³ but this subsequently increased to US$1,401,880 after amendment agreements dated 14 September 2015 (“Installation Contract A1”) and 10 November 2015 (“Installation Contract A2”). ¹⁴ These amendment agreements corresponded to Supply Contract A1 and Supply Contract A2 respectively. Like with the Supply Contract, any reference to the Installation Contract refers to the Installation Contract incorporating both amendments, unless otherwise specified.

6 Under the Installation Contract, OKI was to pay Sunrise: the first 20% two months after the arrival of Sunrise’s supervisor working continuously at the Mill; the next 20% two months after first payment; 30% after OKI’s issuance of a hand over test acceptance; and 30% after OKI’s issuance of a Certificate of Performance Test Acceptance. ¹⁵

7 Under Supply Contract A1, Sunrise was required to procure a bank guarantee from Dena Bank for the sum of US$692,583.90 (the “Bank Guarantee”). The Bank Guarantee was procured on 21 September 2015. Because Supply Contract A2 increased the contract value of the Supply Contract, it provided that the Bank Guarantee had to be increased accordingly, to US$832,413.20. On 6 January 2016, the Bank Guarantee was increased to this amount. ¹⁶

8 As stated above at [4], 80% of the Supply Contract price was to be paid by way of letter of credit. On or about 24 September 2015, OKI extended a letter of credit for the sum of US$5,318,100 to Sunrise (“LC1”). This was 80% of the contract value of the unamended Supply Contract. Under Supply Contract A1, however, the letter of credit needed to be in the sum of US$5,540,671.20 to reflect the increased contract value. LC1 was thus amended by OKI on 16 November 2015 to reflect the increased amount (“LC1 A1”). ¹⁷ LC1 A1 was then amended once more, on 23 December 2015 (“LC1 A2”), when the “last date of shipment” was changed from 3 December 2015 to 29 February 2016. ¹⁸ In order to account for the increase in contract value from Supply Contract A1 to Supply Contract A2, a second letter of credit was issued by OKI on 11 January 2016 (“LC2”). LC2 also reflected 29 February 2016 as the latest date of shipment. ¹⁹

9 Despite LC1 A2 and LC2 indicating 29 February 2016 as the last day of shipment, Clause 5 of Supply Contract A1 provided that Sunrise was to deliver the Section I Goods such that the first consignment arrived at the port of discharge in Indonesia (the “Port of Discharge”) on 17 November 2015, and the last consignment arrived at the Port of Discharge on 25 November 2015. ²⁰ Clause 5 of Supply Contract A2 required Sunrise to ensure that the last consignment of Section II Goods arrived at the Port of Discharge on 15 January 2016. ²¹

10 The Goods were shipped by Sunrise before 29 February 2016. ²² They arrived at the Port of Discharge on or about 24 March 2016. ²³ In respect of the Goods, there are three areas of dispute between the parties. The first is whether the Goods delivered complied with the specifications in the Supply Contract. The second is whether all the Goods that were required to be supplied under the Supply Contract were in fact delivered. The third is whether the Goods were delivered on time.

11 In order to fulfil its obligations under the Installation Contract, Sunrise’s position is that it deployed personnel to the project site at the Mill (the “Project Site”) as early as 25 January 2016. ²⁴ Sunrise’s general manager for the project, Mr Pradeep Mahadeo Thorat (“Mr Thorat”) arrived at the Project Site on or about 25 February 2016. ²⁵ Sunrise’s installation works were hindered by various disputes between the parties regarding, amongst other things, the state of the accommodation at the Project Site and OKI’s release of moneys under the letters of credit. Sunrise demobilised its installation team pending resolution of these disputes on 8 March 2016. ²⁶ On 18 May 2016, OKI informed Sunrise that it had no interest in continuing business with them. ²⁷ Sunrise therefore never completed the installation works, and never received any payment for the same. A few days later, OKI engaged a different company, PT Piping System Indonesia (“PT Piping”), to complete the installation works. ²⁸

12 On 10 October 2016, OKI invoked the Bank Guarantee and directed Dena Bank to pay the sum of US$832,413.20 to it. The evidence of OKI’s only witness in this suit, its mills procurement coordinator Mr Djung Wi Kuang (“Mr Horison”), is that OKI did so to satisfy (in part) the amounts due to it from Sunrise for various breaches of the Supply Contract. ²⁹ In Sunrise’s view, there was no basis for OKI to do so because Sunrise had performed its obligations under the Supply Contract. ³⁰

13 Sunrise first commenced proceedings in India against OKI and Dena Bank (the “Indian Proceedings”). In response, OKI took out an application seeking to dispose of the Indian Proceedings for lack of jurisdiction. The Supply Contract and Installation Contract had exclusive jurisdiction clauses in favour of Singapore. ³¹ By the time OKI’s application was heard, Sunrise had already commenced this suit in Singapore. The Indian Proceedings thus came to an end. ³²

14 This suit was commenced on 6 January 2017. ³³ Sunrise sought injunctions to restrain OKI from calling on the Bank Guarantee and Dena Bank from releasing the Bank Guarantee until the determination of this action. Their summons for an injunction was heard urgently on an ex parte basis on that same day, and Tan Lee Meng SJ granted the injunctions sought. ³⁴ On 28 April 2017, OKI took out an application for the interim injunctions to be set aside. After hearing parties, Tan SJ allowed OKI’s application and the interim injunctions were discharged on 21 June 2018 (see Sunrise Industries (India) Ltd v PT OKI Pulp & Paper Mills and another [2018] SGHC 145). ³⁵ The sum of US$832,413.20 was eventually transferred by Dena Bank to OKI on or about 23 May 2019. ³⁶ Dena Bank did not enter an appearance and took no part in these proceedings. ³⁷ On 13 September 2022, leave was granted for the claim against Dena Bank to be withdrawn with no order as to costs. ³⁸

15 On 24 May 2017, OKI filed its defence as well as a counterclaim (the “counterclaim”). On the same day, it issued formal notices of termination of both the Supply Contract and the Installation Contract to Sunrise. ³⁹

16 Sunrise contends that it fully performed all its obligations under the Supply Contract. As such, it is entitled to the full contract price from OKI, and OKI is not entitled to retain any of the Bank Guarantee that it currently holds. Mr Joy Kunjukutty (“Mr Kunjukutty”), managing director of Sunrise, and Mr Ganapathy Subramanian Viswanath (“Mr Viswanath”), a technical director of Sunrise, gave evidence on behalf of Sunrise.

17 Sunrise’s responses to OKI’s allegations of breach are as follows. There was no delay because the delivery dates in the Supply Contract were varied by agreement. Thus, when the Goods were delivered on or about 24 March 2016, that was in accordance with the Supply Contract. Sunrise supplied manholes in accordance with the drawings provided by OKI, and supplied all the Goods that were required to be delivered under the Supply Contract. Accordingly, Sunrise seeks:

18 Regarding the Installation Contract, Sunrise contends that OKI wrongfully repudiated the Installation Contract, which Sunrise accepted. It therefore seeks the following damages in respect of this repudiation:

19 OKI’s case is that Sunrise breached the Supply Contract by:

20 OKI therefore contends that it is entitled to significant damages under the Supply Contract. The Bank Guarantee was called to satisfy these damages, and OKI is entitled to retain the same. ⁴⁴ In addition to retaining the Bank Guarantee, OKI seeks:

21 OKI alleges that Sunrise was in breach of the Installation Contract. Sunrise’s defective performance of its obligations, refusal to perform installation works and imposition of additional conditions on OKI entitled OKI to terminate the Installation Contract, which it did on 18 May 2016. ⁴⁸ OKI seeks the following damages from Sunrise:

22 The positions taken by parties give rise to the following issues:

23 For reasons I explain, I hold that Sunrise was in breach of both contracts and OKI was entitled to terminate the Installation Contract.

24 The Supply Contract stipulated certain “Delivery Dates”. Clause 5 of Supply Contract A1 provided that Sunrise was to deliver the Section I Goods such that the first consignment arrived at the Port of Discharge on 17 November 2015, and the last consignment arrived at the Port of Discharge on 25 November 2015. ⁵³ In fact, the first consignment arrived on 6 November 2015 ⁵⁴ but the last consignment only arrived on or about 24 March 2016. ⁵⁵

25 For Supply Contract A2, Sunrise was obliged under Clause 5 to ensure that the last consignment of Section II Goods arrived at the Port of Discharge on 15 January 2016. ⁵⁶ In fact, the Section II Goods only arrived at the Port of Discharge on or about 24 March 2016. ⁵⁷

26 Sunrise’s position is that the Delivery Dates were varied in line with the amendments made to the letters of credit. LC1 A2 and LC2 both stated that the “last date of shipment”, the date on which the Goods should be loaded on to the carrier, was 29 February 2016. Sunrise argues therefrom that the Supply Contract was varied such that its obligation was to ensure the Goods were shipped out by 29 February 2016. ⁵⁸

27 For the reasons that follow, I am not satisfied that the Supply Contract was varied in respect of the Delivery Dates.

28 OKI does not dispute that LC1 A2 and LC2 were amended to reflect 29 February 2016 as the last date of shipment, and that OKI agreed to this amendment. OKI disagrees that this amendment had the effect of varying the underlying Supply Contract. ⁵⁹

29 Sunrise argues that “[i]t is trite that a change of date on a letter of credit is deemed to be a variation of the contract”. ⁶⁰ I disagree with this proposition, and I deal with the authorities Sunrise relies upon.

30 In South Caribbean Trading Ltd v Trafigura Beheever BV [2004] All ER (D) 334 (Nov), parties entered an agreement whereby the plaintiff (“SCT”) was to sell to the defendant (“Trafigura”) some barrels of oil. One of the issues which the court considered was whether the date of delivery under one of the contracts had been agreed to be varied. In a telephone conversation, Trafigura’s representative promised that the letter of credit would be extended. Sunrise highlights the court’s finding that (at [105]):

31 However, this was not a statement of legal principle but simply a factual finding in the context of that case. SCT’s case was that “on 14 and 15 March 2001 it was agreed between [SCT] and [Trafigura] that the time for delivery by SCT under Contract 5536 was to be extended from 31 March to 30 June with Trafigura's letter of credit to be amended consistently with the former to permit shipment up to 30 June and its validity for presentation of documents to be up to 15 July 2001” (at [54]). The extension of the letter of credit was consequential to an agreement to amend the underlying contract. It was not SCT’s case that the agreement to extend the letter of credit was, in itself, a variation of the underlying contract.

32 In W.J. Alan & Co. Ltd. v El Nasr Export and Import Co. [1972] 2 QB 189, Lord Denning M.R. held that, where one party to a contract has by his conduct induced the other party to believe that he will not insist on his strict legal rights under a contract, he has waived his rights and cannot afterwards insist on them if the other party has acted on that belief differently from how he would have otherwise acted. This case is not relevant as Sunrise confirmed during the trial that its case was that the Supply Contract had been varied, not that OKI had waived Sunrise’s breach. ⁶¹

33 In China Resources (S) Pte Ltd v Magenta Resources (S) Pte Ltd [1997] 1 SLR(R) 103 (“China Resources”), the letter of credit was amended to provide for a last date of shipment on 14 December 1991. The Court of Appeal found that the sellers were in breach of contract when they failed to deliver by this date (at [31]). However, the fact that the underlying contract had been initially varied to provide for a 14 December 1991 deadline was not disputed. There is no suggestion in this case that the last delivery date under a letter of credit is conceptually the same as the delivery date under the underlying sale of goods contract.

34 Hartley v Hymans [1920] 3 KB 475 is also not of assistance to Sunrise. Sunrise relies on McCardie J’s holding that the buyer was estopped from saying that the delivery period had expired on the contractually stipulated date, or from asserting that the contract had ceased to be valid on that date. McCardie J held that the buyer’s conduct, in requesting delivery after the expiry date, had led the seller to believe that the contract was still subsisting, and the seller had acted on that belief to great expense. This is not relevant to the present case. Sunrise is not alleging estoppel but a variation of the Supply Contract.

35 Thus, none of the authorities cited by Sunrise stand for the proposition which it argues is “trite”. Certainly, as a factual matter, when parties agree to vary the required delivery dates under a sale of goods contract, they will almost certainly amend the delivery date on any letter of credit accordingly. Otherwise, the letter of credit would serve no practical purpose. The seller will not be able to receive payment even though he has complied with the contractual deadline. Nonetheless, the converse does not necessarily follow. While the agreement to extend the delivery date under a letter of credit could mean that parties had reached an agreement to vary the underlying contract, it could also indicate that the buyer was, while willing to accept delivery and make payment, reserving his rights to recover damages caused by the seller’s delay. In order to pay for the Goods and fulfil his own obligations under the contract, he would have to amend the letter of credit accordingly. Therefore, the amendments to LC1 and LC2, and the negotiations leading up to those amendments, are significant only as part of the factual matrix from which I must ascertain if Sunrise and OKI agreed to vary the Delivery Dates under the Supply Contract.

36 Coming to the factual matrix, I first consider the correspondence between the parties surrounding the amendments to LC1 and the opening of LC2.

37 LC1 was issued on 24 September 2015. On 7 October 2015, Sunrise sent an e-mail to OKI stating that LC1 reflected the wrong amount. In this e-mail, Sunrise stated: ⁶²

This was followed by some chasers from Sunrise. On 28 October 2015, Mr Horison replied that LC1 was being processed, and on 29 October 2015 he sought confirmation from Sunrise that OKI would amend the Last Shipment Date from 10 October 2015 to 13 November 2015, and the expiry date from 31 October 2015 to 4 December 2015. ⁶³ I pause to note that, at this point, the proposed last shipment date still came before the Delivery Date for the Section I Goods under the Supply Contract (25 November 2015).

38 In response, Sunrise replied that it required the last shipment date on the letter of credit to be 30 days from the date of receipt of the letter of credit, and the expiry date to be 21 days from the last shipment date. It explained that “[t]he last date of shipment will be changed based on the date of letter of credit amendment” and that time was required for the booking of vessels and containers, and making shipping arrangements. ⁶⁴ Implicit in this e-mail was that Sunrise would not begin to make shipping arrangements until it received a letter of credit with the correct terms.

39 Mr Horison responded that LC1 had already been amended according to the terms stated in his earlier e-mail. He asked Sunrise to “please try your best to delivered this [sic] goods before the deadline”. ⁶⁵ On 31 October 2015, Sunrise arranged for the shipment of goods under the Supply Contract and informed OKI that it had done so. ⁶⁶ However, not all the Section I Goods were shipped in this shipment. On 5 November 2015, Sunrise informed OKI that they would ship the remaining Section I items once they received the amended LC. ⁶⁷

40 LC1 A1 was obtained by OKI on 6 November 2015. It reflected 10% of the price of Supply Contract A1, a last shipment date of 3 December 2015 and an expiry date of 24 December 2015. ⁶⁸ OKI argues that the amendment to the last shipment date was only done because Sunrise threatened to delay shipping the balance Goods if it was not done. On 9 November 2015, OKI had still not sent LC1 A1 to Sunrise, and Sunrise stated that “as soon as we receive the amended letter of credit as per Section I change order, we will despatch all the pending materials and will complete the Section I Change order”. ⁶⁹ LC1 A1 was provided to Sunrise on or about 16 November 2015. ⁷⁰

41 On 28 November 2015, OKI raised an issue with Sunrise because it had heard that the final shipment of Section I Goods was going to be shipped with the Section II Goods. OKI noted that this meant that work would not be able to start until 20 January 2016, and said “THIS WILL BE A DISASTER PLAN”. OKI asked for Sunrise to immediately make alternative shipping arrangements and explained that it had manpower on site whose presence would be a waste if the Goods had not arrived. ⁷¹ Sunrise’s response was to highlight that it only received advance payment from OKI on 13 November 2015, it only received LC1 A1 on 16 November 2015, and it had not yet received payment under LC1 A1. It also stated that it had “already taken necessary actions to expedite the balance shipment”. ⁷²

42 On 3 December 2015, Sunrise informed OKI that it had been trying to ship the Goods at the earliest possible time, but it had been unable to do so due to “non availability of booking on the vessels”. It then noted that the last date of shipment was 3 December 2015 (that day) and the expiry date was 24 December 2015. Sunrise said the following: ⁷³

43 Further, on 7 December 2015, Sunrise explained to OKI that it would be easier for Sunrise to find a shipper for the balance Section I Goods if they were shipped together with the Section II Goods for the following reasons: ⁷⁴

Thus, Sunrise asked OKI to open LC2, and make advance payment under Supply Contract A2 so that it could plan the shipment of the balance Section I Goods together with the Section II Goods.

44 On 14 December 2016, OKI told Sunrise that it was still waiting for a letter from Sunrise for “extended LC expired date & last delivery time”. ⁷⁵ On 16 December 2015, Sunrise sent OKI a letter of request, seeking to amend the last shipment date under LC1 A1 to 28 February 2016 and the expiry date to 21 March 2016, ⁷⁶ in accordance with its plan to ship the balance Section I Goods with the Section II Goods. Ultimately, on 23 December 2015, OKI agreed to this amendment (save that the last shipment date was amended to be 29 February 2016 instead of 28 February 2016) and LC1 A1 became LC1 A2. ⁷⁷

45 As for LC2, OKI first provided Sunrise with a draft on 28 December 2015. ⁷⁸ On 30 December 2015, it asked Sunrise: “How about the latest shipment date? should we put 29 feb 2016 (as per amendment of AA1?” ⁷⁹ LC2 was then opened on 11 January 2016 with a last shipment date of 29 February 2016. ⁸⁰

46 Mr Horison’s evidence is that OKI never agreed to extend the time for delivery of the Goods under the Supply Contract. The timelines as stated in the Supply Contract always remained important to OKI to ensure that there were no delays for the Mill. OKI had “no choice” but to agree to amend the last date of shipments in the letters of credit so that Sunrise would take steps to ship the Goods. When LC2 was opened, the last date of shipment was stated to be 29 February 2016 because Sunrise had indicated that it would be shipping the balance Section I Goods and the Section II Goods together. ⁸¹

47 Mr Kunjukutty also did not offer clear evidence of an agreement by both parties to extend time. He conceded it was his assumption, in the following way: ⁸²

48 Even later, he relies on a lack of objection by OKI: ⁸⁴

49 Sunrise’s case may be said to be that it offered to vary the Delivery Dates by its various e-mails, and it assumed that OKI agreed. It cannot be fairly said, however, that there was any acceptance on the part of OKI. When OKI agreed to amend the last date of shipment in LC1 and opened LC2 with a last date of shipment after the Delivery Date, it was simply ensuring that Sunrise could receive payment under the letters of credit so that Sunrise would ship the Goods, as it was already obliged to do. OKI’s correspondence reflected vexed indulgence, rather than agreement in a contractual sense. It was not forgoing its right to liquidated damages for delivery after the Delivery Dates stated in Clause 5.1. None of the correspondence between the parties suggests that OKI had done so. Nor was there any reason why it would do so. As expressed in their e-mail at [41] above, the deadlines were important to them. As I explained at [35] above, parties may have good reasons for agreeing to extend the validity and last shipment date of a letter of credit without agreeing to a change in the deadline in the underlying contract. Sunrise has adduced insufficient evidence to prove that OKI’s agreement to amend the letters of credit was anything more than just that.

50 In this context, it is important to note that the Supply Contract expressly set out a process for the variation of Delivery Dates. Clause 5.2 read as follows: ⁸⁵

51 Contrary to the wording of Clause 5.2, Sunrise did not in writing notify that it was entitled to an alteration of the time schedule. Sunrise raised for the first time in closing oral responses that all that was required for Clause 5.2 was anything in writing. In my judgment, whatever correspondence parties had could not fairly be said to have been sufficient notice nor agreement in writing for the purposes of Clause 5.2. The correspondence did not even refer to Clause 5.2.

52 The overall picture that emerges is simply that OKI knew that Sunrise was going to deliver the Goods after the Delivery Dates. In order to receive the Goods, it facilitated delivery by amending its letters of credit. This does not amount to a variation. Variation of the terms of a contract does not occur as a matter of course where an innocent party tolerates tardiness. Variation requires offer and acceptance between parties that is supported by consideration: Aero-Gate Pte Ltd v Engen Marine Engineering Pte Ltd [2013] 4 SLR 409 at [36].

53 Sunrise points to the fact that LC1 A2 and LC2 were ultimately drawn down on 22 April 2016, which was after their respective expiry dates. ⁸⁶ It argues OKI must have asked its bank to allow payments to be released to Sunrise, and that this means that OKI knew that Sunrise was entitled to payment under the letters of credit because the Goods had been shipped by their last payment dates. ⁸⁷ This does not assist Sunrise. Even if Clause 5.1 had not been varied, Sunrise was entitled to payment under the letters of credit because it had delivered the Goods to OKI. Clause 5.1 did not entitle OKI to withhold 80% of the contract price if the Delivery Dates were not met. It only entitled OKI to liquidated damages (the maximum of which was provided to be 10% of the contract price). ⁸⁸ Thus, the release of the moneys under the letters of credit does not suggest that Clause 5.1 must have been varied. OKI had no contractual basis to withhold payment.

54 I conclude therefore that parties did not mutually agree to a variation of Clause 5.1 of Annex III of the Supply Contract.

55 For good measure, OKI also contends Sunrise has failed to identify any consideration in the event of any variation. In Ma Hongjin v SCP Holdings Pte Ltd [2021] 1 SLR 304 (“Ma Hongjin”), the Court of Appeal considered and rejected arguments that the requirement of consideration should be abolished in the context of variations or modifications to a contract: at [60]–[94].

56 Sunrise makes three points in response. First, it contends that OKI is not entitled to raise a lack of consideration because it failed to raise this point in pleadings. Sunrise relies on the Court of Appeal’s decision in Lim Zhipeng v Seow Suat Thin and another matter [2020] 2 SLR 1151 (“Lim Zhipeng”) for the proposition that a defendant must plead a lack of consideration if it wishes to deny a variation on that basis. ⁸⁹ However, Lim Zhipeng does not stand for this proposition. In Lim Zhipeng, the appellant’s case as set out in his statement of claim was based on a purported deed of guarantee by the respondent. In response, the respondent pleaded that “she never intended the Guarantee to be a Deed of Guarantee … and/or there was no consideration for the [Respondent] signing the Guarantee” (at [49]). This was denied by the appellant in his reply. The trial judge held that the purported deed was invalid, and therefore the guarantee would only be enforceable if it was supported by consideration. The trial judge dismissed the appellant’s claim because consideration had not been adequately pleaded in his statement of claim (at [19]). The Court of Appeal disagreed, and held at [54] that:

Thus, Lim Zhipeng stands for the proposition that a plaintiff cannot be faulted for failing to expressly plead consideration in its statement of claim. It does not stand for the proposition that a defendant is only entitled to raise lack of consideration if it has been pleaded. Lim Zhipeng is therefore irrelevant in this case – OKI is not suggesting that Sunrise’s claim should fail due to its failure to identify consideration in its statement of claim. It is Sunrise that is suggesting that OKI’s defence which involves an absence of consideration ought to have been pleaded. To consider this issue, Sunrise’s statement of claim is relevant.

57 In Sunrise’s statement of claim, it pleaded that it “completed its performance of its contractual obligations under the Supply Contracts in a timely fashion in the month of February 2016” at para 7. At para 30, it pleaded that it had not breached any of the terms of the Supply Contracts and that it had completed its obligations under the Supply Contracts. It did not expressly refer to any variation of the Delivery Dates in the Supply Contract. With no allegation of a variation of the Supply Contract, OKI could not respond in its defence that there was a lack of consideration for that variation. Sunrise’s position is thus that OKI ought to have amended its defence, or filed a rejoinder, after Sunrise raised in its reply the allegation that the latest dates of shipment in the Supply Contract had been extended. Neither option would have been appropriate given that Sunrise itself did not amend its statement of claim to incorporate reference to the variation.

58 Thus, there is nothing preventing OKI from arguing that the purported variation of the Supply Contracts was not supported by consideration. Sunrise relies on this variation, and the onus is on Sunrise to establish that the Supply Contracts were validly varied.

59 Sunrise’s second alternative contention is that Clause 5.2 dispensed with the need for any consideration. ⁹⁰ The Court of Appeal in Ma Hongjin accepted at [36] that parties could, by agreement, dispense with the requirement of consideration. Sunrise argues that Clause 5.2 did so dispense with consideration. A plain reading of the Clause (see [50] above), with its reference to compensation in the second and third paragraphs, reflects that it was envisaged that consideration be discussed between parties when the clause was exercised. I have held at [51] that Sunrise did not issue the requisite notice under the clause, and thus Clause 5.2 would in any event be inapplicable.

60 As a third alternative, Sunrise argues that there was consideration. The Court of Appeal in Ma Hongjin accepted at [65] that any factual benefit (in line with Williams v Roffey Bros & Nicholls (Contractors) Ltd [1991] 1 QB 1 (“Williams”)) could satisfy the requirement of consideration. Sunrise’s position is that very little is required by way of consideration where parties are in a commercial relationship (see Gay Choon Ing v Loh Sze Ti Terence Peter and another appeal [2009] 2 SLR(R) 332 at [102]–[103]). Only a practical benefit is required and Sunrise cites the practical benefit OKI received from the receipt of the Goods. It relies upon Williams, where the factual benefit of the timely performance of the contract was considered consideration for an increase in the contract price. Of course, in Williams, parties had come to an agreement. In the present case I have held that parties did not have such an agreement. As such, there was no properly accepted delivery date. Instead, OKI was faced, on a rolling basis, with continued tardiness. No factual benefit was conferred by Sunrise’s continual delay. Nor did Sunrise offer anything in exchange for OKI agreeing to extended timelines; they simply assumed that OKI would accept the situation. With no proper renegotiation or fresh bargain struck, while Sunrise did eventually supply all the material it had promised to supply, the lateness remained a breach for which variation would have required fresh factual benefit. The facts of this case are more akin to Foakes v Beer (1884) 9 App Cas 605, where it was held that a promise to accept part payment of a debt was unenforceable for lack of consideration, than to Williams.

61 I therefore find that the Delivery Dates within Clause 5.1 of Annex III were not varied. Sunrise was in breach of the Supply Contract by failing to comply with the Delivery Dates in Clause 5.1.

62 It is not disputed that Sunrise did not supply OKI with manholes that complied with the specifications set out in Clauses 1.1(a) and 1.2 of Supply Contract A1 read with Attachment I of Supply Contract A1, and Clause 1 read with Attachment III of Supply Contract A2 (the “Specification Clauses”). ⁹¹ Sunrise’s case is that it had supplied manholes which followed instead the specifications contained in revised drawings which were accepted by OKI, and that this means they did not breach the Supply Contract. ⁹² It is not disputed that Sunrise supplied manholes in accordance with revised drawings that were signed by OKI on 22 September 2015. The issue here is therefore what the applicable specifications were under the Supply Contract.

63 I accept that the applicable specifications were those contained in the drawings which OKI accepted. The documentation shows a pre-contract understanding that the specifications in the Specification Clauses would be modified subsequently. On 7 May 2015, Mr Jamaluddin from OKI’s technical team told Mr Horison that: “Drawing revision can be done after selection of supplies as per site condition and requirement” [emphasis added]. ⁹³ Mr Horison followed on with instruction to Mr Atanu of Sunrise: “Please kindly print out and sign that manhole drawing now to process commercial based on this preliminary data first” [emphasis added]. ⁹⁴ OKI and Sunrise were aware that the specifications in the Specification Clauses of the Supply Contract were to be preliminary, and revisions were to be made after selection of supplies. There was no agreement to reduce the contract price in the event that smaller manholes were needed.

64 This arrangement was necessary because the precise specifications of the manholes depended upon measurements on the ground as well as the condition of the ground. Mr Horison accepted in cross-examination that the site was a green field area on an island. The manholes were to be installed underground, and the ground condition such as its gradient and the existence of plants would affect the size of manhole needed. He thus accepted that standard size manholes would not be appropriate, and the required specifications could only be finalised once someone made measurements on site. ⁹⁵

65 Mr Horison conceded that OKI had accepted Sunrise’s revised drawings but alleged that OKI was forced to do so. ⁹⁶ However, his evidence was not consonant with the documentation. The context behind OKI’s acceptance of the revised drawings is as follows. In early September 2015, a dispute arose between OKI and Sunrise about the specifications of the manholes. Sunrise sent OKI a document dated 8 September 2015 (the “MTO”) containing certain specifications. However, Sunrise later pointed out that the specifications in the MTO did not match the drawings which had been approved by OKI’s technical team. On 17 September 2015, Mr Alain Dion from OKI’s technical team proposed that a set of manhole drawings be printed and initialled for inclusion in the Supply Contract, and that “Sunrise should list as part of their MTO and for each manhole the diameter and height so that the MTO would match with the drawings”. ⁹⁷ This reflects the initial agreement Sunrise and OKI’s technical team had prior to the contract, and shows that the specifications in the drawings were to take precedence. Following this, on 21 September 2015, Mr Horison sent an e-mail to Mr Michael Wong (“Mr Wong”), the person in charge of the Project. In this e-mail he asked Mr Wong to confirm which specifications should be used: those in the signed MTO, or those in the drawings which had not been signed by OKI. He highlighted that some manholes manufactured based on the drawings had heights below two metres, when the price of the Supply Contract had been calculated based on a minimum height of two metres (the specification in the MTO). ⁹⁸ In cross-examination, he explained that he was highlighting the loss incurred as the manholes were smaller. ⁹⁹ There was no response from Mr Wong to this e-mail. However, the next morning, Mr Jamaluddin responded with: “Enclosed file Sunrise drawing signed”. ¹⁰⁰ Thus, the pricing and specifications of the manholes had been specifically accepted by the technical team both prior to contract and in its fulfilment. Mr Atanu was then informed also on 24 September 2015. Sunrise and OKI’s technical team worked together on the various drawings up to 10 November 2015. ¹⁰¹

66 Therefore, on 24 September 2015, the parties were in agreement that the specifications were those in the drawings. Any personal opposition that Mr Horison had to this was never acted upon by OKI. However, when the Supply Contract was signed on 28 September 2015, it appears that there must have been a mistake because the Specification Clauses included the specifications from the MTO. Nevertheless, it is clear that the intention to use the specifications in the revised drawings remained. As counsel for OKI rightly conceded, OKI would have been extremely vexed if the manholes had been delivered per the specifications in the MTO because they would not have been usable for the plant. ¹⁰² Thus, OKI received precisely what it bargained for: manholes which could be used on the plant with specifications that had been approved by its technical team. The claim that Sunrise supplied non-compliant manholes is not genuine, and this will be made even more clear when I consider the manner in which OKI calculated its apparent loss arising from this alleged breach, which I deal with in passing.

67  OKI seeks damages in respect of Sunrise’s supply of non-compliant manholes in the sum of US$584,496. The first time OKI specified US$584,496 as the sum overcharged for the manholes was in its Defence and Counterclaim (Amendment No 2) dated 13 August 2019. ¹⁰³ OKI arrived at this sum because it is the difference between the price paid by OKI and the price which it claims it should have been charged based on the actual size of the Goods received. ¹⁰⁴

68 OKI relies on Bridgeman Pte Ltd v Dukim International Pte Ltd [2013] SGHC 220, where the plaintiff breached the contract by overcharging the defendant and the court awarded the defendant damages amounting to the difference between the price that the defendant should have been charged under the contract and the price that the defendant was actually charged (at [51]). OKI argues that smaller manholes have a lower value since less material would be used to make them. Thus, the amount that it should have been charged for the non-compliant manholes is the Supply Contract price reduced in proportion to the reduction in size of the manholes supplied. ¹⁰⁵ To illustrate, I use one manhole as an example: ¹⁰⁶

69 The issue with this methodology is that it assumes that the market value of the manholes is directly proportionate to their size. I do not accept that this is necessarily the case. No evidence was adduced by OKI to suggest that this is the case. Instead, OKI relies on Giedo Van Der Garde BV and another v Force India Formula One Team Ltd (Formerly Spyker F1 Team Ltd (England)) [2010] EWHC 2372 (QB) (“Giedo Van Der Garde BV”). ¹⁰⁷ There, an agreement was reached for the defendant to, amongst other things, allow the plaintiff to drive 6000km in its Formula 1 car. Ultimately, the defendant only allowed the plaintiff to drive 2004km. In awarding damages, the court held that “loss is to be assessed by reference to the value of the kilometres and associated benefits which should have been but were not provided” (at [487]). However, the court went on to explain that:

Thus, the court’s ultimate concern was the market value of the benefit not provided. The contract price was simply one piece of evidence that was relevant. Further, Giedo Van Der Garde BV does not stand for the proposition that the market value of a non-provided benefit can be assumed to be directly proportionate to the contract price. Admittedly, the damages awarded in Giedo Van Der Garde BV were directly proportionate to the benefit lost. The court held that the plaintiff had not been provided the benefit of 3,730km out of 6,000km, and thus there was a 62.17% loss in this regard. The value of this lost benefit was held to be $1,865,000 (at [498]), which is 62.17% of $3m, which was the contract price (at [3]). However, it is clear that the court arrived at this conclusion after considering expert evidence on the value of driving 4,000km in a Formula 1 car (see [488]–[494]), and did not do so by assumption.

70 There was no such expert evidence adduced by OKI as to the market value of the manholes. There was therefore nothing to suggest that the value of the manholes was directly proportionate to their size. In fact, the prices charged for the manholes under the Supply Contract suggested that their values were not directly proportionate to their size. For example, OK-01’s size would be 0.7668m3. OK-06’s size would be 7.52m3. Thus, OK-06 was 9.81 times the size of OK-06. However, the price of OK-06 under the Supply Contract (US$25,751) was only 6.90 times of OK-01’s price (US$3,734). Therefore, I do not accept that the market value of the manholes can be obtained simply by reference to their size. OKI did not contract for the supply of manholes to be resold to a third party. Conversely, OKI contracted for the supply of goods it required to install in the Mill. The manholes were custom-drawn and built, and there is no evidence that they were not installed by PT Piping. Nor is there any evidence that the manholes failed to serve the purpose upon installation due to their specifications. I should mention that while Mr Horison stated that OKI spent IDR7,080,400 (roughly US$453) to modify the manholes for use, ¹⁰⁸ the particular document exhibited details manpower costs which were likely accounted for in the installation price paid to PT Piping.

71 A final issue in this context was OKI’s contention as to the non-delivery of a manhole. On or about 16 October 2015, Sunrise provided OKI with a president summary which indicated that it was to provide 16 manholes of certain dimensions pursuant to Supply Contract A2. ¹⁰⁹ It is not disputed that Sunrise only supplied OKI with 15 of these manholes although its case was that 16 were manufactured. ¹¹⁰ It is also undisputed that 15 were sent because OKI only needed 15 of these manholes, and its technical team had told Sunrise this. ¹¹¹ Supply Contract A2 was signed on the basis of the drawings and the directions of the technical team to be supplied later. Because the technical team no longer required the last manhole and told Sunrise this, there is no issue of non-delivery. In any event, as it was not disputed that OKI did not require the last manhole, there is no loss arising from the lack of delivery of the last manhole.

72 OKI alleges that Sunrise breached the Supply Contract by failing to supply “tools, special tools, consumables, plant and machineries” (“Special Tools”) along with the Goods, within the meaning of Clause 4.5 of Annex I Appendix 5 of the Supply Contract. ¹¹²

73 However, OKI does not seek damages in respect of this alleged breach. It relies on the non-delivery of Special Tools in order to establish its entitlement to maximum liquidated damages under the Supply Contract. Given my conclusion above that Sunrise breached the Supply Contract by failing to meet the Delivery Dates, I conclude at [80] below that it is entitled to maximum liquidated damages under the Supply Contract. As such, I need not consider this alleged breach.

74 Under the Supply Contract, Sunrise was to supply OKI with a “Site Warehouse”, “Site Office” and “Site Preparation”. OKI alleges that Sunrise did not do so. ¹¹³

75 OKI’s allegation is not borne out by the evidence. Between 4 January 2016 and 4 February 2016, Sunrise informed OKI that it would be preparing a site office and fabrication shed. ¹¹⁴ On 16 March 2016, Sunrise’s Mr Thorat reported that their “workshop container office” had been broken into. ¹¹⁵ In an e-mail on 30 March 2016, Sunrise informed OKI that the “Site Warehouse”, “Site Office” and “Site Preparation” had already been completed at the site. ¹¹⁶ OKI did not refute this.

76 Further, these offices would have been necessary to the installation phase of the project, which was ultimately completed. There was no evidence that OKI paid any other entity to prepare the warehouse, office or site. The amount claimed for this item comprised merely a demand for repayment of amounts paid to Sunrise based on invoices issued by Sunrise. ¹¹⁷

77 I therefore accept Sunrise’s position that it did supply the “Site Warehouse” and “Site Office”, and complete “Site Preparation”.

78 Under Clause 6.1 of Annex III of the Supply Contract (read with Clause 6.5 of Annex III), OKI was entitled to liquidated damages amounting to 10% of contract price if the shipment was delayed by more than six weeks. ¹¹⁸ As mentioned earlier, shipment only completed on or around 24 March 2016. This was more than six weeks after both the Delivery Dates in Supply Contract A1 and Supply Contract A2. Thus, OKI is entitled to liquidated damages of US$832,413.20.

79 Sunrise submits that, because OKI has used all the Goods supplied under the Supply Contract for the construction of the Mill, and the Mill has been in operation since December 2016, OKI has suffered no loss. Therefore, its claim for maximum liquidated damages is entirely inequitable and constitutes unjust enrichment. ¹¹⁹ This argument is misconceived. First, a party does not need to prove loss to entitle itself to liquidated damages. This would defeat the purpose of liquidated damages, which are intended to “facilitate recovery of damages without the difficulty and expense of proving actual damage”: Chitty on Contracts (Hugh G. Beale gen ed) (Sweet & Maxwell, 34th Ed, 2021) at para 29-205. Second, it cannot reasonably be said that the fact that the Mill is now in operation and the Goods have all been used means that OKI has suffered no loss. They received the Goods late, and one can generally expect losses to flow from that fact. That is precisely why Clause 6.1 of Annex III exists in the Supply Contract. Third, Sunrise has produced no authority for the proposition that unjust enrichment, which is ordinarily an independent cause of action, can be used as a defence to a claim in contract.

80 Thus, I award OKI liquidated damages under the Supply Contract of US$832,413.20.

81 Finally, OKI seeks a full refund of the amounts paid to Sunrise under the Supply Contract, being US$7,491,718.80. ¹²⁰

82 OKI argues that under Clause 16.1(c) of Annex III of the Supply Contract, it was entitled to terminate the Supply Contract if “delivery of the [Goods] has been delayed so much that [OKI] is entitled to the maximum amount of liquidated damages as stated in the [Supply Contract] or if such a delay becomes obviously imminent or a major repair obligation has not timely started”. ¹²¹ OKI did so on or about 24 May 2017. Clause 16.1(c) also provides that should the Supply Contract be terminated by OKI, Sunrise was to return all paid payments received with 12% annual interest.

83 I reject OKI’s submission. Its entitlement to unilaterally terminate the Supply Contract arose when the Goods were delayed by more than six weeks, which was in January 2016 for Supply Contract A1 and February 2016 for Supply Contract A2. The fact is that, at that point in time, OKI did not terminate the Supply Contract. Instead, OKI agreed to amend the letters of credit such that they could make payment for Sunrise’s delivery of the Goods. Having elected not to exercise its entitlement to terminate the Supply Contract in January or February 2016, and allowing OKI to ship the Goods, OKI was no longer entitled to rely on Clause 16.1(c). Clause 16.1(c) clearly envisages a situation in which the Goods had not yet been shipped, or in which the Goods were non-functional. Neither situation is applicable here. Sunrise points out that the letters of credit expired on 21 March 2016, and delivery was only completed on 24 March 2016. Thus, in order for OKI’s bank to make payment to Sunrise, OKI would have to authorise payment despite the discrepancy. ¹²² I accept that this was likely the case, and OKI authorised the payment of the balance 80% of the Supply Contract price on 22 April 2016. ¹²³ This indicates that Sunrise supplied the Goods as required under the Supply Contract, albeit with delay – and the issue of delay is the function of the liquidated damages clause.

84 Thus, there is no basis for OKI to claim a refund from Sunrise.

85 Sunrise claims that it is due the final 10% of the contract price payable under the Supply Contract. OKI claims that it is not, because the final 10% of the contract price only becomes payable upon a Certificate of Performance Test Acceptance as defined by the Supply Contract being issued to Sunrise, and no such certificate has been issued.

86 The relevant clause is Clause 3.1 of the Supply Contract which provides: ¹²⁴

The Certificate of Performance Test Acceptance is defined in Clause 1 of Annex III of the Supply Contract as follows: ¹²⁵

87 OKI’s argument is that the effect of these provisions is that the payment of the final 10% of the contract price was expressly tied to Sunrise’s installation of the Goods. ¹²⁶ The Certificate of Performance Test Acceptance would only be issued upon Sunrise’s completion of installation works – and this never happened in light off Sunrise’s repudiation of the Installation Contract. In my view, this reading of Clause 3.1 is unduly narrow. In Zurich Insurance (Singapore) Pte Ltd v B-Gold Interior Design & Construction Pte Ltd [2008] 3 SLR(R) 1029 at [131], the Court of Appeal endorsed, among others, the following canons as a guide for interpreting contracts:

88 OKI’s submission is premised on the proposition that Sunrise’s obligations under the Supply Contract included installing the Goods. If Sunrise’s obligations did not extend to personally installing the Goods, there would be no reason for them to be denied any part of the contract price as long as the Goods were installed and were in good working condition. The preamble to the Supply Contract states that Sunrise is “willing and able to sell and deliver the [Goods] to [OKI] in accordance with the terms and conditions set forth in [the Supply Contract]”. ¹²⁷ Clause 11 of Annex III of the Supply Contract sets out the general obligations of Sunrise. ¹²⁸ None of the clauses therein refer to an obligation on the part of Sunrise to install the Goods. Of course, this is entirely understandable given that parties had agreed a separate Installation Contract. Even looking at Clauses 3.1 and 11 in isolation, there is no clear indication that the Goods must be installed by Sunrise. I therefore do not accept that, on an objective interpretation of the Supply Contract as a whole, installation fell within Sunrise’s obligations. Thus, my interpretation of Clause 3.1 is not one whereby Sunrise is only entitled to full payment if it personally completes the installation works. The final 10% is payable as long as OKI has certified that the relevant performance guarantees and conditions as defined in Clause 1 of Annex III of the Supply Contract ¹²⁹ have been met. The Supply Contract was for the provision of the Goods; and the relevant time to assess whether the Goods have been fully supplied was at the time of completion of installation.

89 OKI issued to PT Piping a completion certificate in respect of the installation works which was dated 16 April 2016 but signed by OKI on 18 and 19 June 2017. ¹³⁰ Further, OKI has accepted that the installation works for the Goods completed in December 2016, and the Mill is presently in operation. ¹³¹ In response to Sunrise’s claim for the final 10%, OKI did not allege that any of the Goods were faulty or did not meet the performance requirements stated in the Supply Contract. It simply relies on the fact that no Certificate of Performance Acceptance Test in the narrow sense (ie, one issued by OKI in respect of installation works carried out by Sunrise) has been issued. In the circumstances, I am satisfied that the Goods complied with the performance guarantees and conditions, and therefore Sunrise is entitled to the balance 10% of the Supply Contract price.

90 The Bank Guarantee was issued pursuant to the Supply Contract. It is undisputed that OKI had paid up to 90% under the Supply Contract at the time that OKI called on the Bank Guarantee. This was the amount that Sunrise was entitled to at that juncture, because its case relies on the certificate issued by PT Piping approved by OKI in June 2017. ¹³² At the same point in time, based on my findings above, OKI was also entitled to liquidated damages of 10%. It was therefore appropriate at that juncture for OKI to call upon the Bank Guarantee to recoup that amount. Accordingly, no relief is granted to Sunrise for the call on the Bank Guarantee.

91 According to OKI, Sunrise breached the Installation Contract by failing to perform the installation works by the agreed times as set out in Clause 5.1 read with Annex VII Appendix 1 of the Installation Contract. ¹³³ This then entitled OKI to terminate the contract.

92 Sunrise has two key responses. First, it alleges that the timeline set out in the Installation Contract does not apply. ¹³⁴ Sunrise argues that the timeline whereby mobilisation was to be completed by 21 September 2015 and installation work was to be completed by 31 January 2016 is inapplicable because it must be read with the specified shipping schedule, which provided that the Goods were only to begin arriving on 25 October 2015. ¹³⁵ However, Sunrise has not explained what the appropriate timeline is, or how it complied with it. I note that Sunrise accepts that 28 February 2016 was the appropriate “Start-Up Date” under Clause 5.1 of the Installation Contract, being the date beyond which delay of installation work entitled OKI to liquidated damages. ¹³⁶ There is no dispute that as of 28 February 2016, the installation work had not been completed by Sunrise. Thus, the relevance of this argument is unclear. Sunrise clearly failed to complete the installation works within the time stipulated in the Installation Contract.

93 Second, Sunrise claims that it was ready, willing and able to perform the Installation Contract and did in fact perform some installation works. In this regard, Sunrise highlights that the following is clear from the correspondence between parties from November 2015 to April 2016: ¹³⁷

94 Notably, Sunrise’s response is not that it fully performed its obligations under the Installation Contract. Rather, its response is that it had performed some of its obligations, was willing to perform fully, but was unable to do so due to OKI’s conduct. Nevertheless, none of OKI’s conduct that Sunrise complains of amounted to a breach of the Installation Contract, nor did it constitute conduct for which Sunrise was entitled to delay performance under the Installation Contract.

95 A key aspect of the dispute between parties that led to Sunrise’s demobilisation concerned the accommodation facilities for Sunrise’s personnel. In an e-mail on 2 March 2016, Mr Thorat highlighted to OKI that the housing arrangements for Sunrise’s personnel were unsatisfactory, and that despite concerns having been raised with OKI, OKI was not remedying the situation. Sunrise’s personnel therefore had to stay in unsatisfactory conditions since 25 February 2016. In the circumstances, Sunrise had to hold off on further deployment of its manpower, and had to consider demobilising the team already in Indonesia until the housing issues had been solved. ¹³⁸ The same day, Mr Kunjukutty sent an e-mail to OKI stating that Sunrise was not able to create any housing facilities at the Project Site due to various constraints. He also stated that Sunrise would pay for accommodation provided by OKI, but it had to be provided immediately. Otherwise, Sunrise would not be able to send more personnel from India. ¹³⁹ On 8 March 2016, Mr Kunjukutty informed OKI that Sunrise’s personnel still had not been provided with the requisite housing facilities and Sunrise therefore had “no choice but to demobilise the team”. He also told OKI that Sunrise would not be mobilising any further personnel unless and until it received confirmation on the availability of the requisite facilities. ¹⁴⁰ Sunrise’s team and Mr Thorat left the Project Site a few days later. ¹⁴¹

96 Subsequently, Mr Thorat met with OKI’s representatives who agreed to attend to the housing issues and meal arrangements for Sunrise’s personnel. However, they requested that Sunrise make advance payment before they readied the accommodation. ¹⁴² Sunrise describes this as an unreasonable and particularly onerous obligation that had not been agreed between parties. ¹⁴³

97 Clause 4 of Annex I Appendix 1 of the Installation Contract provided the following: ¹⁴⁴

At trial, Mr Kunjukutty accepted that the obligation to provide accommodation and food services was on Sunrise, not OKI. ¹⁴⁵ He accepts also that pursuant to the above clause, Sunrise was to “arrange the living camp with local standard for its management and workers.” ¹⁴⁶ However, he contends that there was an “understanding” that OKI would provide Sunrise with the appropriate housing facilities and that Sunrise would pay OKI for the same. ¹⁴⁷ Sunrise did not plead the existence of such an understanding, nor was any documentation on its terms produced. In any case, even if there was such an understanding, there was nothing which prevented OKI from demanding advance payment for providing the services which were truly Sunrise’s responsibility under the Installation Contract.

98 I accept that there was no prior agreement that Sunrise would pay in advance for accommodation provided by OKI. However, neither was there an agreement that OKI would not require advance payment. This is illustrated by the fact that, when OKI requested advance payment, Mr Thorat’s response was not that this was contrary to prior agreement, but that it had been put up for approval with management. ¹⁴⁸ Given that there was no agreement either way on advance payment, Sunrise was subject to OKI’s terms if it chose to rely on OKI to provide accommodation. When I raised this, counsel for Sunrise submitted that “if that’s a doubt, that can’t be used as a reason to terminate a contract … because both parties have not agreed to that.” ¹⁴⁹ That is precisely the point. The absence of an agreement either way about advance payment meant that Sunrise could not use it as a reason to demobilise from the Project Site and neglect its obligations under the Installation Contract.

99 Based on the terms of the Installation Contract, Sunrise had no basis to expect that OKI would provide its personnel with accommodation or food services. Therefore, dissatisfaction with the state of the accommodation which OKI nevertheless agreed to provide, or with the payment terms offered by OKI, did not entitle Sunrise to delay its performance under the Installation Contract. OKI’s conduct did not constitute a breach of the Installation Contract, which said nothing about its provision of accommodation for Sunrise’s personnel. What Sunrise did in response, however, was a breach of the Installation Contract. Sunrise demobilised its personnel from the Project Site which prevented it from performing its obligation to install the Goods.

100 Given that Sunrise breached the Installation Contract, the next question is whether OKI was, as a result of that breach, entitled to terminate the Installation Contract.

101 It is first important to identify when exactly the Installation Contract was terminated. There are three possible dates. First, there is 24 May 2017, when OKI’s solicitors served on Sunrise a “NOTICE OF TERMINATION”. ¹⁵⁰ Second, there is 18 May 2016, being the date when OKI informed Sunrise by e-mail that it had “no interest to continue business with [Sunrise] anymore” and “[a]ll [its] rights under the contract shall be claimed from [Sunrise] to the fullest extent possible”. ¹⁵¹ Finally, there is 7 April 2016, when Mr Horison accepted that he told Mr Thorat to leave the Project Site, and that essentially he was saying that he did not want Sunrise to perform the Installation Contract anymore. ¹⁵²

102 The Installation Contract cannot have been terminated by OKI on 7 April 2016, because after that date, the correspondence shows that OKI and Sunrise still contemplated that the Installation Contract would be performed. On 12 April 2016, OKI requested payment from Sunrise for processing fees so that it could obtain work permits for ten of Sunrise’s personnel. ¹⁵³ At this point, parties were still operating on the basis that they were to perform their obligations under the Installation Contract. On 3 May 2016, OKI urged Sunrise to dispatch its personnel to start installation work without any further delay. ¹⁵⁴ The position changed, however, with OKI’s 18 May 2016 e-mail. In this e-mail, OKI made clear that it did not wish for Sunrise to perform the installation works. A few days later, OKI engaged another company to perform the installation works instead (see [11] above). Thus, at this point, OKI had elected to terminate the Installation Contract in response to Sunrise’s breach. Because the Installation Contract was terminated as at this date, it follows that the later notice of termination issued by OKI’s lawyers was of no effect.

103 OKI submits that it was entitled to terminate the Installation Contract for two reasons. First, Sunrise refused to perform its installation work and insisted on imposing additional conditions that had not been agreed, which constituted a repudiatory breach. Second, the Installation Contract expressly provided OKI with an entitlement to terminate.

104 I have found that Sunrise breached the Installation Contract because of its delay, at [92] above. The installation works were not completed by 28 February 2016, the stipulated Start-up Date, and they remained uncompleted when the Installation Contract was terminated on 18 May 2016. As I find at [109] below, this entitled OKI to the maximum liquidated damages under the Installation Contract. Clause 24.1 of Annex III of the Installation Contract provides: ¹⁵⁵

Accordingly, OKI was entitled to terminate the installation contract on 18 May 2016. This falls within Situation 1 at [113] of RDC Concrete Pte Ltd v Sato Kogyo (S) Pte Ltd [2007] 4 SLR(R) 413 (“RDC Concrete”), which is where “[t]he contractual term breached clearly states that, in the event of certain event or events occurring, the innocent party is entitled to terminate the contract.” The Installation Contract clearly states that, where Sunrise’s delay is such that maximum liquidated damages are payable, OKI is entitled to terminate.

105 OKI’s case on their acceptance of Sunrise’s repudiatory breach is also made out. In RDC Concrete at [93], the Court of Appeal held that a party is entitled to elect to terminate a contract when the other party “by his words or conduct, simply renounces its contract inasmuch as it clearly conveys to the other party to the contract that it will not perform its contractual obligations at all” [emphasis in original omitted]. The Court of Appeal further explained in iVenture Card Ltd and others v Big Bus Singapore City Sightseeing Pte Ltd and others [2022] 1 SLR 302 (“iVenture”) at [64], that:

The Court of Appeal went on to explain at [65] that:

106 In the present case, the position is made clear by an e-mail sent by Sunrise to OKI on 17 May 2016, the day before OKI elected to terminate the Installation Contract. ¹⁵⁶ Sunrise informed OKI that despite repeated reminders and requests, it had not received payment “as per the terms and conditions of the contract”, and hence it would “not be interested to continue the contract”. Sunrise then stated that, if OKI was interested, it could amend its order in the following respects:

This e-mail is unambiguous. Sunrise had no intention of abiding by the terms of the Installation Contract. It was requesting that OKI do what it was not contractually required to do, whether by the Supply Contract or the Installation Contract. As explained at [4] above, the final 10% under the Supply Contract was only payable upon the issuance of a Certificate of Performance Test, which at this point had not been issued. As for the Installation Contract, Sunrise was only entitled to payment of the first 20% after its supervisor had been working on the Project Site continuously for two months (see [6] above). If OKI did not comply with Sunrise’s requests, it was not interested to continue the Installation Contract. Sunrise has not put forward any other characterisation of this e-mail. This e-mail cannot be reasonably characterised in any other manner.

107 In addition, by the time this e-mail was sent, Sunrise had already demobilised its team and had made clear that it would not remobilise until OKI arranged for accommodation (see [95] above). As explained, OKI had no obligation under the Installation Contract to do so. Further, Sunrise had stated that the delays to the installation works were due to OKI’s failure to release payment under LC1 A1. ¹⁵⁷ On Sunrise’s own case, the Installation Contract and Supply Contract were separate agreements. ¹⁵⁸ OKI therefore had no obligation under the Installation Contract to release payment under the Supply Contract. By stating that this was a reason for the delay in installation works, Sunrise was effectively telling OKI that it would only perform if OKI complied with its unilaterally imposed condition to make payment under a separate contract. A reasonable person would certainly conclude that Sunrise no longer intended to be bound by the Installation Contract.

108 OKI was therefore entitled to terminate the Installation Contract when it did so on 18 May 2016.

109 Under Clause 6.1 read with Clause 6.2 of the Installation Contract, OKI is entitled to liquidated damages of up to 10% of the contract price if the installation work was delayed. OKI is entitled to 1.5% of the contract price for each week of delay for the first four weeks, and 2.5% for each subsequent week. ¹⁵⁹ Clause 5.1 provides that the “Start-up Date” to be used “[f]or the purpose of calculating liquidated damages under Clause 6” is 28 February 2016. ¹⁶⁰ I interpret this to mean that the delay referred to in Clause 6 is delay after 28 February 2016. The installation works were not completed by 28 February 2016, and they remained uncompleted when the Installation Contract was terminated on 18 May 2016. By this time, there had been more than six weeks of delay. OKI is therefore entitled to maximum liquidated damages under the Installation Contract, amounting to US$144,154.50.

110 OKI also seeks to recover from Sunrise the costs it incurred in engaging PT Piping to complete the installation works. It relies on Clause 24.1 of Annex III of the Installation Contract. ¹⁶¹ As partially set out at [104] above, Clause 24.1 sets out various situations in which OKI is entitled to terminate the Installation Contract. It then states: ¹⁶²

111 As I found at [108] above, and on OKI’s own case, ¹⁶³ OKI did terminate the Installation Contract. It therefore cannot rely on this part of Clause 24.1 which provides it with an alternative to termination. OKI also seeks to recover this sum as general damages flowing from Sunrise’s breach, in that OKI would not have incurred the costs of engaging PT Piping but for Sunrise’s breach in failing to complete the installation work, which I consider in the next section.

112 OKI also claims the following:

113 OKI would have incurred the cost of the Installation Contract but for Sunrise’s breach. Thus, OKI may only recover from Sunrise the costs that it incurred in excess of the Installation Contract price. Had the Installation Contract been performed, OKI would have incurred US$1,401,880, being the contract price. As a result of Sunrise’s breach, OKI in fact spent the total of the sums at items (a) to (d): IDR20,996,015,000 plus US$8,666 (approximately US$1.35 million). As for item (e), the invoices produced by OKI to substantiate its claim for US$441,224 indicate that the cost would be allocated to PT Piping. ¹⁶⁹ When this was put to Mr Horison in cross-examination, he did not give a clear answer as to whether the cost had been borne by OKI or by PT Piping. He simply reiterated that the cost ought to have been borne by Sunrise under the Installation Contract. In the circumstances, it is unclear whether or not OKI charged PT Piping the sum of US$441,224. Therefore, there is insufficient evidence that the cost of transporting materials within the Project Site amounting to US$441,224 was borne by OKI. Thus, despite Sunrise’s breach, OKI in fact spent less than the Installation Contract price to receive installation of the goods.

114 It is a well-established rule of mitigation that an innocent party which successfully avoids loss by taking steps in mitigation is not entitled to damages from the party in breach. At [24], the Court of Appeal in The “Asia Star” [2010] 2 SLR 1154 explained that:

OKI successfully avoided losses by procuring a contract with PT Piping for a lower price. Its total actual expenditure on installing the Goods is less than the contract price of the Installation Contract. Thus, it is not entitled to recover any general damages. OKI relies on the case of Yew San Construction Pte Ltd v Ley Choon Constructions and Engineering Pte Ltd [2019] SGHC 285 (“Yew San”), where damages were awarded to a main contractor in respect of works that were within its subcontractor’s scope of works, but had in fact been completed by the main contractor due to the subcontractor’s failure to complete them. While this is somewhat similar to OKI incurring costs to carry out tasks that fell within Sunrise’s scope of works, the crucial difference is that in Yew San, the main contractor paid the subcontractor for its works (see [5] and [227]). Here, OKI made no payment to Sunrise under the Installation Contract.

115 OKI is owed US$832,413.20 under the Supply Contract as liquidated damages (see [80] above). However, it has already received this sum by calling on the Bank Guarantee. Sunrise is entitled to the remaining 10% of the Supply Contract price of US$832,413.20 (see [89] above). OKI is owed US$144,154.50 as liquidated damages under the Installation Contract (see [109] above). The final sum is therefore US$688,258.70 in favour of Sunrise, and I award Sunrise this sum, with interest at 5.33% from the date of its writ.

116 Parties are to write in within 14 days of today in respect of costs.