In Management Corporation Strata Title Plan No 4099 v TPS Construction Pte Ltd and others [2024] SGHC 149 (“MCST 4099”), the plaintiff, Management Corporation Strata Title Plan No 4099's, claim against the third defendant, KTP, was struck out for being time-barred under the Limitation Act 1959 (2020 Rev Ed) (the “Limitation Act”).
Facts. The plaintiff is the Management Corporation Strata Title Plan No 4099 (the “Development”) (MCST 4099 [1]).
KTP was engaged (MCST4099 [5]):
- by the developer, Kedron Investments Pte Ltd, as the structural engineer and Qualified Person (“QP”) (Structural) responsible for the structural works of the Development; and
- by the first defendant, the main contractor of the Development, to provide professional consulting services for the Development, including services relating to the external cladding façade.
There are a few key events.
First discovered defects. In or around June 2015, the plaintiff discovered defects in the Development (MCST4099 [7]).
First expert report – Bruce James Report. From March to April 2016, the plaintiff engaged a firm of building surveyors (“Bruce James”) to conduct a visual inspection of the Development, which led to a report dated 22 September 2016 (the “Bruce James Report”) (MCST4099 [8]). The Bruce James Reported identified, among others, a cladding defect in relation to 14 units, and one of the defects discovered was the “[e]xcessive accelerated deterioration to the timber cladding around bay windows including warping / deterioration”. (MCST4099 [8])
Rectification works by first defendant. Rectification works were carried out by the first defendant in relation to the defects identified in the Bruce James Report in or around March 2017 (MCST4099 [9]).
Discovered recurring defects. But sometime between March 2017 and 21 September 2017 (MCST4099 [39(b)], the plaintiff discovered that certain defects had recurred (MCST4099 [10]), which were set out in a defects list (“Defects List”) in the plaintiff's statement of claim (MCST4099 [10]).
The defects included “damaged and detached timber panels on the external cladding façade of 49 units, including eight units identified in the Bruce James Report(the “Cladding Defect”). This was described in the Defects List in the same terms as the Bruce James Report” (MCST4099 [10])
Second expert report – Meinhardt Report. The plaintiff commenced the Suit against the first defendant on 21 February 2022 (MCST4099 [11]).
The plaintiff then engaged Meinhardt Façade (S) Pte Ltd (“Meinhardt”) to investigate the defects listed in the Defects List in or around July 2022, resulting in two reports, including a report on the Cladding Defect on or around 3 August 2022 (the “Meinhardt Report”) (MCST4099 [12]).
Suit against KTP. The plaintiff then applied to join KTP to the Suit, which was allowed by the court, and the Suit was commenced against KTP on 17 February 2023 (MCST4099 [14]).
Issue. The main issue was whether the plaintiff's case against KTP should be struck out under O 18 r 19(1)(b) of the Rules of Court (2014 Rev Ed) for being time-barred (MCST4099 [24]).
The applicable provision was Section 24A(1) of the Limitation Act as the plaintiff's action against KTP was for breach of statutory duty and negligence (MCST4099 [35]). The relevant limitation period is set out in s 24A(3) of the Limitation Act:
“(3) An action to which this section applies, other than [where the damages claimed consist of or include damages in respect of personal injuries], shall not be brought after the expiration of the period of —
(a) 6 years from the date on which the cause of action accrued; or
(b) 3 years from the earliest date on which the claimant or any person in whom the cause of action was vested before him first had both the knowledge required for bringing an action for damages in respect of the relevant damage and a right to bring such an action, if that period expires later than the period mentioned in paragraph (a).”
6-year time bar in s 24A(3)(a). Under this limb, the plaintiff's cause of action in tort accrues when the damage occurred (MCST4099 [36] – [38]). And this turned on whether the cause of action accrued as of the date of the Bruce James Report on 22 September 2016.
The High Court found that “the Bruce James Report clearly noted on 22 September 2016 that physical damage had manifested on the cladding façade. In my judgment, it would have been reasonably discoverable by the plaintiff on this date. This defect was of the same nature as the Cladding Defect.” (MCST4099 [40])
This was derived from an interpretation of the Bruce James Report, which was supported by the plaintiff's own pleading (MCST4099 [41] – [42]). This is because the Bruce James Report used language that suggested systemic issues with the cladding façade, i.e., it raised “issues of substance beyond those of mere cosmetics” (MCST4099 [41]).
Therefore, 17 February 2023 was past the six-year limitation period which started running from 22 September 2016, and the action was time-barred (MCST4099 [43]).
3-year time bar in s 24A(3)(b). This limb was the focus of the parties' submissions. The question to be answered was when the plaintiff acquired the requisite knowledge, in order to determine when the 3 years under s 24A(3)(b) of the Limitation Act ought to start running (MCST4099 [44]).
The High Court reviewed the key cases relied on by the parties (MCST4099 [48] – [50]), which “illustrate that the limitation clock is not reset for new appearances of the same type of defect, if the plaintiff had reasonable notice, at the time the earlier defect emerged, that the issue was not an isolated one.” (at [47])
As the Suit against KTP was brought against KTP on 17 February 2023, s 24A(3)(b) of the Limitation Act would not assist the plaintiff if the plaintiff had the requisite knowledge by 17 February 2020 (MCST4099 [51]).
The elements of knowledge under s 24A(4) of the Limitation Act were whether the plaintiff had knowledge by 17 February 2020 (MCST4099 [52]):
“(a) … that the Cladding Defect was attributable to KTP's alleged negligent design and supervision of the construction of the cladding façade;
(b) … of material facts about the Cladding Defect which would lead a reasonable person to consider it sufficiently serious to justify instituting proceedings against KTP; and
(c) … of KTP's identity.”
The key relevant dates were:
- 22 September 2016, the date of the Bruce James Report, and/or
- Between March 2017 to September 2017, when the defects recurred.
And the Court found against the plaintiff for all three issues (MCST4099 [53] – [61]).
Among others, the Court considered it important the plaintiff's “pleaded position that the Cladding Defect was the same as the defect identified in the Bruce James Report”, as it showed that the plaintiff had actual knowledge of the same defect by 22 September 2016 (MCST4099 [56]).
Further, the Court held that as the Cladding Defect had surfaced sometime between March 2017 – 21 September 2017, then “… [t]he plaintiff should have commissioned an expert to carry out further inspections around that period … If this had been done, the plaintiff would have received that expert's opinion before 17 February 2020. But instead, the plaintiff only chose to engage Meinhardt in 2022. The systemic issue with the cladding façade (and KTP's role in it) was thus something that the plaintiff was reasonably expected to acquire from facts observable or ascertainable by it by 17 February 2020 (s 24A(6) Limitation Act)” (MCST4099 [58]).
The Court also highlight that the plaintiff “… had already sought the views of an expert, and despite the rectification works, the Cladding Defect re-emerged” (MCST4099 [59]), which led the Court to hold that by latest 17 September 2017, the plaintiff “… had knowledge of material facts which rendered the case ‘sufficiently serious for [the plaintiff] to actually invoke the court process'…” (MCST4099 [59]).
Significance. The Court noted that “the wording of the report was broad [and it] pointed to a general issue … for 14 units out of 121” (MCST4099 [41]). Importantly, “the wording of the [report] alluded to wider systemic issues, not merely aesthetic ones” (MCST4099 [54]). In short, the “expert surveyor had produced a report that should have rung alarm bells for any reasonable person in the plaintiff's position” (MCST4099 [54]).
So if you receive an expert report on defects, read it carefully. If the report suggests that there may be systemic issues, or a need to conduct further follow-up, then you should do so, or clarify with the expert if you are not sure.
If not, and you fail to take timely action, then, as this case illustrates, you may find that you are out of time to commence proceedings based on the issues identified in the expert report.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.