Enforceability of Liquidated Damages Clause Not Conditional on Actual Loss

In Comfort Management Pte Ltd v OGSP Engineering Pte Ltd and another (No. 2) [2020] SGHC 165, a sub-subcontractor resisted the imposition of liquidated damages on the ground that the sub-subcontract was “back-to-back” with the upstream subcontract and the main contractor had not imposed any liquidated damages on the subcontractor. The High Court rejected this submission, holding that whether the main contractor in fact imposed liquidated damages on the  subcontractor was a legally irrelevant consideration and does not affect the subcontractor’s right to recover liquidated damages from the sub-subcontractor.

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