Important Recent Decision On SOPA: LJH Construction & Engineering Co Pte Ltd v Chan Bee Cheng Gracie [2022] SGHC 230

• Published date: 27 October 2022
• Law Firm: Chancery Law Corporation
• Author: Mr Tian Luh Tan and Xian Ying Tan

In this week's blog, we take a quick look at some of the key points raised in LJH Construction & Engineering Co Pte Ltd v Chan Bee Cheng Gracie [2022] SGHC 230, where the High Court covered a variety of important issues relating to adjudication under the Building and Construction Industry Security of Payment Act 2004.

In the interests of brevity, we will focus only on some of the key points, and will not cover all the facts and arguments. However, we urge interested readers to read LJH Construction & Engineering Co Pte Ltd v Chan Bee Cheng Gracie [2022] SGHC 230 ("LJH v CBC") in full.

Service of payment claim via email. Ang Cheng Hock J first addressed what is required of a party who wishes to effect service of a payment claim via email under s. 37 of the Building and Construction Industry Security of Payment Act 2004 ("SOPA").

Ang J held that for a payment claim to be validly served via email under s. 37 SOPA, it must be "likely to be effective in bringing the claim to the attention of the addressee in a reasonably prompt manner, and the sender has the onus of proving this." ([47] LJH v CBC). We set out [47] LJH v CBC below:

"47 Accordingly, in my judgment, service of a payment claim by email would only be valid if it is likely to be effective in bringing the claim to the attention of the addressee in a reasonably prompt manner, and the sender has the onus of proving this. To that end, where a sender wishes to serve a payment claim on a recipient via the last email address of the addressee known to the sender under s 37(3)(b) of the SOPA, the sender must have some basis, which is objectively ascertainable, to believe that the last known email address is one which the addressee currently uses, or at least checks, regularly. It is insufficient that the sender has some subjective belief, without any proper basis, that the last known email address would be one that the addressee would check regularly. While I do not propose to exhaustively define what would amount to such an objectively ascertainable basis, an example would be where the sender has, in the recent past, sent emails to the addressee via a particular email address, and the addressee has replied using that email address."

While this requirement would generally not be an issue for most construction projects as, in our experience, most payment claims would have been served regularly via email to either the respondent's project staff or to a project email, this issue is extremely important if the respondent is a natural person, as in the case of LJH v CBC.

As Ang J observed at [49] LJH v CBC, "... In this day and age, it is commonplace for individuals to have multiple email accounts, some of which may have been created some time ago and may no longer be in use. Senders may learn of these unused email addresses with relative ease, for instance, by searching the internet for the contact information or the social media profile(s) of the intended recipient... It would be grossly unfair if a claimant were allowed to serve payment claims via email addresses which are no longer in regular use..."

On the facts of LJH v CBC, Ang J found that the payment claim in question was not validly served. Among others, Ang J found it significant that:

1. Prior to the payment claim in question, the claimant had never served any payment claims on the respondent via email.
2. There was no evidence of the respondent using the Hotmail account regularly after 2016, let alone in 2021 when the payment claim in question was served.

While this is a fact-sensitive question in each case, LJH v CBC makes clear that a claimant bears the onus of proving good service, if challenged. This is a welcomed decision as it should deter claimants from attempting to commence smash-and-grab adjudications by claiming to have validly served their payment claims on the respondents by effecting service on some "defunct" email address.

Fraud. Ang J also found that the...