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Summary: The Singapore High Court’s Appellate Division has clarified that a claimant does not need to prove an intention to rectify defective works before seeking cost of cure damages. Instead, intention to cure is only one factor in deciding whether such damages are reasonable and proportionate. The decision in Terrenus Energy SL2 Pte Ltd v Attika Interior + MEP Pte Ltd also provides useful guidance for construction disputes involving defective works and competing measures of damages.
The Singapore High Court’s Appellate Division has provided important clarification on cost of cure damages in construction disputes. In Terrenus Energy SL2 Pte Ltd v Attika Interior + MEP Pte Ltd [2025] SGHC(A) 4, the court considered whether a claimant must intend to carry out rectification before recovering the estimated cost of doing so.
The court confirmed that intention to cure is not a prerequisite. Instead, it is one factor to consider when deciding whether an award based on the cost of cure would be reasonable and proportionate.
Background of the Case
Terrenus Energy engaged Attika Interior + MEP as the main contractor for a solar power generation facility at Changi Business Park. Among its claims, Terrenus alleged that PEG Rods had not been embedded to the minimum depth required under the contract. It sought the cost of rectifying the alleged defect, arguing that the non-compliance created a risk of structural failure during high winds. Attika disputed both the alleged risk and Terrenus’ claim for substantial damages.
The dispute eventually reached the Appellate Division, where the court considered the broader principles governing the choice between cost of cure and other measures of damages.
What Is Cost of Cure?
Contractual damages generally aim to place the claimant in the position it would have been in had the contract been performed. Cost of cure is one way of achieving this by providing the financial means to obtain the performance originally promised.
However, the cost of cure is not automatically recoverable simply because defective work has been established. The court must consider whether the proposed remedy is reasonable and proportionate in the circumstances. Relevant considerations can include the seriousness of the defect, the consequences of the defect, the cost of rectification compared with the benefit obtained, the purpose of the contract and any subjective value attached to the promised performance.
The Role of Intention to Cure
Earlier decisions had taken different approaches to whether a claimant’s intention to carry out repairs was necessary. In Chia Kok Leong v Prosperland Pte Ltd [2005] 2 SLR(R) 484, the Court of Appeal held that an intention to repair was not a prerequisite. However, JSD Corporation Pte Ltd v Tri-Line Express Pte Ltd [2022] SGHC 227 took the view that intention to cure was a weighty factor and that its absence would generally prevent recovery of cost of cure damages.
In Terrenus Energy, the Appellate Division departed from the approach in JSD Corporation. It held that intention to cure is neither a prerequisite nor generally a weighty factor. Instead, it forms part of the overall assessment of reasonableness and proportionality.
What This Means for Construction Claims
The decision provides greater clarity for parties dealing with defective works. A claimant does not automatically lose a cost of cure claim simply because the rectification has not yet been carried out or is not intended.
However, the absence of an intention to cure may still be relevant. The court will consider it alongside other circumstances when determining whether the claimed remedy fairly reflects the claimant’s loss.
For contractors, developers and consultants, the decision highlights the importance of documenting the nature of defects, their consequences, proposed rectification measures and estimated costs. These factors can help establish whether the claimed cost of cure is a reasonable and proportionate response to the breach.
References
- Supreme Court of Singapore, Terrenus Energy SL2 Pte Ltd v Attika Interior + MEP Pte Ltd and another appeal [2025] SGHC(A) 4. — Primary judgment. https://www.elitigation.sg/gd/s/2025_SGHCA_4
- Dentons Rodyk, “Clarifying the role of intention in awarding cost of cure damages: Insights from Terrenus Energy SL2 Pte Ltd v Attika Interior + MEP Pte Ltd”, 3 March 2025. https://dentons.rodyk.com/en/insights/alerts/2025/march/3/clarifying-the-role-of-intention-in-awarding-cost-of-cure-damages
- Singapore Journal of Legal Studies, “The Role of Intention in Cost of Cure Damages Revisited”, [2026] Sing JLS 171. — Later academic analysis of the Terrenus Energy decision. https://law.nus.edu.sg/sjls/wp-content/uploads/sites/14/2025/10/sjls_mar_2026_171.pdf
