When Do You Require A Specialist Builder's Licence For Structural Steelwork?

A case study of Nam Hong Construction & Engineering Pte Ltd v Kori Construction (S) Pte Ltd [2016] SGCA 42

Overview

In Nam Hong Construction & Engineering Pte Ltd v Kori Construction (S) Pte Ltd [2016] SGCA 42, the Court of Appeal (CA) firstly, affirmed the High Court decision that a disjunctive interpretation of the term "structural steelwork" under s 2(1)(d) of the Building Control Act (BCA) should be adopted. Secondly, it held that the licensing regime under Part VA BCA does not apply to subcontractors.

This update takes a closer look at the Court of Appeal's landmark decision.

Background

Kori Construction (S) Pte Ltd (Kori) was engaged by Sato Kogyo (Sato Kogyo) to perform construction works for the MRT Downtown Line Project (the Project). Kori then subcontracted part of the works to Nam Hong Construction & Engineering Pte Ltd (Nam Hong). Nam Hong was to carry out "fabrication, loading and unloading" of steel strutting works including connection plates and stiffeners (the Works).

The dispute arose when Kori defaulted on the final invoice sum of S$147,538.39. Nam Hong sued Kori in the District Court to recover payment. Kori argued that Nam Hong was not entitled to payment as Nam Hong did not possess an appropriate builder's licence at the material time. Their case was that Nam Hong had carried out "structural steelwork", a type of "specialist building works" within the meaning of s 2(1) BCA, without a licence as mandated by the BCA.

Section 29B(3) BCA makes it an offence for builders to carry out "specialist building works" without a licence, while s 29B(4) BCA precludes a builder from recovering remuneration for works done without an appropriate licence. Section 2(1) defines "specialist building works". This includes "structural steelwork" which is defined in s 2(1)(d) as "comprising":

(i) fabrication of structural elements; (ii) erection work like site cutting, site welding and site bolting; and (iii) installation of steel supports for geotechnical building works.

Nam Hong contended that all three limbs have to be read conjunctively. This would mean that all three elements must be fulfilled for the steelworks to fall within the meaning of "specialist building works" in s 2(1)(d). Kori, on the other hand, argued that the performance of any one of the three elements would amount to "specialist building works" and thus argues for a disjunctive interpretation.

Parties agreed that Nam Hong had carried out (i) and (ii) above but not (iii). Hence, the distinction between a...