Skip to content Skip to sidebar Skip to footer
non-paying customers

Let’s talk about non-paying customers on construction projects with a Lawyer Mr. Khelvin Xu of the distinguished Singapore law firm Rajah & Tann Singapore LLP.

Our guest expert will share his views on how to deal with payment disputes and collection issues from a legal standpoint. A case study about a commercial fit-out project was presented by to kick-off this very informative discussion.

We hope that this VLOG will help enlighten the viewers on ways to tackle problems and come up with legal solutions either through arbitration, mediation, litigation or the security of payments act.

The Case Study

A business owner (the client) has awarded a renovation project of an F&B establishment to a Design & Build Contractor, everything was working well and the owner has agreed to a fixed contract amount of $80K and paid 50% down payment for the project.

The rest is to be paid in progress claim of 20% upon a certain milestone and 30% upon completion.

The project was smooth until the invoicing of the second progress payment is due. Upon billing the client starts to be erratic and unreasonable on the works performed by the contractor and demanded that the payment be made in full after the completion. Since the contractor wants to build a good relationship with the client, it decided to continue the project until its completion. The project has been fully completed and is to be billed in full.

Again, the client has raised unreasonable demands and claims that the work is not complete although all plans and specifications are followed. After constant collection requests for almost 120 days, the client never responds to the contractors’ calls and demand emails. Yet the Client has already opened his new establishment and operated the business ever since the premises have been completed.

What will be the best course of action for the contractor to recover the balance payment?  

  1. Are there any Non-Legal solutions you can recommend, Like Debt Collection Companies?
  2. How effective is a Letter of Demand? Since others consider this as a bluff?
  3. What other forms of settlement are available? Mediation, Arbitration, Litigation?
  4. What is the threshold (amount in $$$) do you suggest would trigger a formal dispute resolution?
  5. What are the options available for out of court settlement?
  6. Is it possible for the contractor to implement the Security of Payments Act in this case?
  7. Besides money, what triggers clients to proceed with formal dispute resolution?
  8. What is the best advice you can give to contractors to make sure they will get paid?  

All of this will be answered on our groundbreaking VLOG below. Watch it on our YOUTUBE Channel or listen to our PODCAST

For further professional legal advice, you can email or give him a call at +65 6232-0442


The material in this presentation is prepared for general information only and is not intended to be a full analysis of the points discussed. This presentation is also not intended to constitute, and should not be taken as, legal, tax or financial advice by Rajah & Tann. The structures, transactions, and illustrations that form the subject of this presentation may not be applicable or suitable for your specific circumstances or needs and you should seek separate advice for your specific situation. Any reference to any specific local law or practice has been compiled or arrived at from sources believed to be reliable and Rajah & Tann does not make any representation as to the accuracy, reliability or completeness of such information.

Share your comments and like the article so more people will read and learn from this topic. You may want to read this related article: RFP or RF Free

Show CommentsClose Comments

Leave a comment