The Devil in Details - when a mistake leads to a dispute

Stuart Peter

Oct 28

4 min read

Tuffi (Pte) Ltd v Techkon Pte Ltd [2026] SGHC(A) 25 ("Tuffi")

In Tuffi, we are faced with an unfortunate but not unforeseeable situation of a Calculation Mistake being made in an agreement. As a result, the “Final Sum” stated to be payable under the agreement ended up being disputed even though both parties had signed off on the “Final Sum” as stated therein.

Unfortunately, this is more common than one may realise, especially for example, in case involving more complex calculations or the tallying of multiple components. For example, in a a construction dispute involving many line items, rates and quantities, a single missed entry or decimal point in one row could have a significant knock in effect on subsequent calculations, and may go unnoticed by parties.

Curing an error: Interpretation or rectification?

Interestingly, in Tuffi, the Appellate Division took the view that contractual interpretation should not be force-fitted as a mechanism for resolving what is in fact a mistake, especially where such interpretation is inconsistent with the plain and ordinary words used. In this case, the agreement was clear on its face on the sum payable, and also provided how this sum was arrived at.

The following observations of the Court are pertinent:

At [65] and [71]: When interpreting a contract, the meaning ascribed to the term must be one which the expressions used by the parties can reasonably bear. While the court is entitled to depart from the plain and ordinary meaning of the expression used, there is a limit to what the court can legitimately do, and where the court seeks to reject the actual words used, the alternative of rectification may be the more appropriate remedy. The equitable remedy of rectification refers to the reconstruction of a document where there is a mismatch between the parties’ common intention and the instrument which purports to record it.

The legal elements for contractual rectification on account of a common mistake

To succeed in obtaining the remedy of rectification, a party would need to show (at [73]):

1. Parties had a common continuing intention in respect of a particular matter in the instrument (whether or not this amount to an agreement)

2. There was an outward expression of accord on the same

3. The intention continued at the time of the execution of the instrument

4. The instrument did not reflect the common intention by mistake

This is to be distinguished from the contractual defence of common mistake that seeks to void a contract. Because of the distinct outcomes that result from either pleading a defence of common mistake or pleading a case for rectification, there are different thresholds that the law imposes for each. For example, for a contractual defence of common mistake to succeed, it must be shown that that mistake rendered the subject matter of the contract fundamentally different from the subject matter which the parties contracted on as constituting the basis of their contract. This is not a requirement to meet in obtaining the remedy of rectification.

In Tuffi, the Court ultimately found that the "Final Sum" as set out and broken down in the agreeement was not in line with parties’ common intention. Specifically, the “Final Sum” double-counted certain expenses (which could not have been either party’s intention at the time of signing). It was accordingly decided that the remedy of rectification was appropriate.

Implied terms

The Court in Tuffi also took the view that even if rectification was not ordered, an implied would exist to the effect that the Final Sum would be adjusted if there are any calculation errors, since it appeared that the possibility of calculation errors did not appear to have been contemplated at the time, and it would have been obvious to a reasonable third party observer that adjustments should be made in the event of errors. Further, if the shoe was on the other foot, i.e. Techkon had paid more than was intended, it would be obvious that an adjustment should be made to reflect parties' intentions.

Conclusion

The case provides several important learning points:

First, not all mistakes are equal. Being able to identify provisions which carry higher risk assists in the contract drafting and review process.

Second, there are limits to what the Court will accept “parties must have meant” to re-interpret a contract. In a dispute therefore, the material facts establishing a mistake must be pleaded to obtain the remedy of rectification. The cleanest way for this to be done is to expressly plead facts matching the legal elements for rectification (set out above), and to expressly seek rectification as a remedy at the outset.

Third, it may be said that interpretation, rectification and implication are three distinct but related approaches that the Court ultimately relies on to give effect to parties actual intentions in entering into an agreement. Where a remedy of rectification is being considered, it would also be useful to stress test a potential argument for an implied term. This can be useful where it is uncertain whether all four elements for rectification can be established on the evidence.

Contract drafting can be both interesting and maddening, but when done well, it can mark a time and cost-saving feature in a business life-cycle of extreme value.