A Gentleman’s Word is His Bond? Not for Variations

Where the contract between the parties stipulates that variation works shall be carried only with written instructions, and there were no written instructions but only oral instructions, the claim for variations will not be valid: Vim Engineering Pte Ltd v Deluge Fire Protection (SEA) Pte Ltd [2021] SGHC 63.  The variation clause provided that “[a]ny variation work… shall be on a back-to-back basis with the Main Contract.  Such variation shall be carried out only with written [instructions] from [designated person]… [Sub-Subcontractor] shall be entitled to ninety percent (90%)… or shall allow a discount of 10% (Profit & Attendance) for [the Subcontractor], on any approved variation claim for additional work orders”. 

The High Court also held that the giving of verbal instructions cannot amount to a waiver or estoppel of the contractual clause requiring written instructions.  Such verbal instructions simply mean that the contractual requirements of written instructions has not been complied with.   

As to the Sub-Subcontractor’s argument that “a gentleman’s word is his bond” and therefore the Subcontractor should pay, the Court held that the Subcontractor was indeed just simply honouring what parties had already agreed in the first place – the contractual clause requiring written instructions.

The rationale for written instructions was explained. One, it serves as a written record of the instruction, and would thus obviate disputes.  Two, it focuses the parties attention that there may be an adjustment of the contract sum. Three, it reduces disputes as to whether the works were truly beyond the contractual scope.

Leave a Reply

Your email address will not be published.