The case of Youprint Productions Pte Ltd v Mak Sook Ling [2022] SGHC 212 concerns an appeal on a simple point of law: when a breach of contract is proven, but not its loss or damage, should the claim be dismissed, or should it be allowed with nominal damages awarded?

The decision below. In the decision below, the District Judge found that the respondent had breached the appellant's employment contract, but that the appellant had not proved loss (at [2]). The District Judge did not award nominal damages to the appellant, but instead dismissed the appellant's claim, relying on LighthouseCarrwood Ltd v Luckett [2007] EWHC 2866 (QB) (“LighthouseCarrwood”) (at [3]).

The appeal. On appeal, Chua Lee Ming J (“Chua J”) agreed with the appellant that the District Judge's decision was wrong as a matter of law, because (at [5]):

  1. The innocent party's entitlement to claim for damages is as of right, for loss resulting from breach of contract;
  2. Recovery of substantial damages requires proof of such loss;
  3. If the fact of damage or quantum of loss is not proven, only nominal damages may be awarded.

Actionable per se. Chua J cited Butterworths Common Law Series: The Law of Damages (Andrew Tettenborn gen ed) (LexisNexis, 2nd Ed, 2010) to explain this position (at [6]).

In gist, a breach of contract is actionable per se. This stands in contrast with, for example, tort law, which requires proof of loss. As such, “… any infringement [i.e., breach of contract] is automatically wrongful, and damages are available as of right whether or not any loss is suffered … if no other recoverable loss is proved, the claimant still has a right to nominal damages.

The relevant paragraphs are reproduced below (at [5] – [6]):

“5 The innocent party is always entitled to claim damages as of right for loss resulting from breach of contract: see RDC Concrete Pte Ltd v Sato Kogyo (S) Pte Ltd and another appeal  [2007] 4 SLR(R) 413 at [40]; Denka Advantech Pte Ltd and another v Seraya Energy Pte Ltd and another and other appeals [2021] 1 SLR 631 at [60]. Breaches of contract are actionable without proof of damage, but recovery of substantial damages requires proof of such loss: The Law of Contract in Singapore vol 2 (Andrew Phang Boon Leong gen ed) (Academy Publishing, 2022) at para 20.073. If the claimant fails to prove either the fact of damage or the quantum of its loss, only nominal damages may be awarded: Biofuel Industries Pte Ltd v V8 Environmental Pte Ltd and another appeal [2018] 2 SLR 199 (“Biofuel”) (at [44]).

6 The position is explained in Butterworths Common Law Series: The Law of Damages (Andrew Tettenborn gen ed) (LexisNexis, 2nd Ed, 2010) (“The Law of Damages”)as follows, at paras 2.05–2.07 and 2.09:

2.05 A fundamental fault-line runs through the English law of obligations. It divides wrongs into two categories: (1) those for which proof of loss is an essential ingredient, and (2) those which are actionable per se. In cases in the former category, which importantly includes the torts of negligence, nuisance, deceit and the economic torts, no cause of action at all arises unless and until some loss is suffered by the claimant. In the latter, any infringement is automatically wrongful, and damages are available as of right whether or not any loss is suffered. It follows from this that, if no other recoverable loss is proved, the claimant still has a right to nominal damages. …

2.06 … nominal damages are essentially symbolic. The giving of them is only appropriate where no actual recoverable loss is shown. …

2.07 For the purpose of the award of nominal damages, wrongs actionable per se include all breaches of contract …

2.09 …where a claimant proves a breach but no recoverable loss, the court has effectively no choice but to award nominal damages. …”

On other authorities.In relation to LighthouseCarrwood which the District Judge had cited in reliance, Chua J stated that (at [7]):

  1. The question as to whether a breach of contract is actionable as of right was not in issue in that case; and
  2. Insofar as LighthouseCarrwood decided that a claim for breach of contract fails if loss cannot be proved, it was wrong and should not be followed.

As for Robertson Quay Investment Pte Ltd v Steen Consultants Pte Ltd and another [2008] 2 SLR(R) 623 and Biofuel which were cited by the respondent (at [8] – [9]), Chua J stated that the requirement for “… the claimant having attempted its level best to prove its loss were made in the context of proof of substantial damages, not nominal damages …” (at [10]).

In general, for building and construction disputes, usually the question of nominal damages does not arise for typical scenarios, such as, e.g., disputes over the imposition of liquidated damages, disputes over variations, etc.

However, this question is relevant when it comes to, e.g., disputes over defects. Where there has been a trifling departure from the contractual specification, the innocent party needs to ask itself what is the loss suffered, beyond the fact that there has been a departure from contractual specification. A failure to adduce any evidence of loss may mean that there is a de minimis breach such that only nominal damages would be awarded.

Bifurcated trial. It is also relevant, however, to bear in mind that the question of what damages (if any) affects costs as well. As set out by Chua J, where the claimant fails to prove loss for breach of contract, whether the claimant will be awarded costs depends on whether the trial was bifurcated or not (at [11]).

“11 I would add that where the trial is not bifurcated and the claimant succeeds in proving breach of contract but recovers only nominal damages because it fails to prove loss, generally, the claimant ought to be awarded costs. The quantum of costs may, of course, take into account the fact that the claimant has failed to prove loss. On the other hand, where the trial is bifurcated and the claimant fails to prove loss during the hearing for the assessment of damages, the claimant would generally either recover no costs or be ordered to pay the costs of the assessment. This is because at the assessment hearing, the only issue is the quantum of loss and a claimant who merely receives nominal damages has effectively lost: The Law of Damages at para 2.15.”

In other words, if you only recover nominal damages at the end of a suit, it is possible that (depending on the facts of the case) you will be regarded as the “losing” party such that you will not recover any costs, or will be only entitled to recover minimal costs.

Significance. This case is an important reminder that a breach of contract is actionable per se, and that the breach of a contract is a separate and distinct concept from the loss caused by the said breach. It also reminds us that the question of quantum of damages recovered goes not only to the issue of how much a party can recover for the breach of contract, but also towards the question of how much costs can a party recover from the opposing party in the proceedings.

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