Varying Contracts – Consideration, Form and Reality

Abstract

In Ma Hongjin v SCP Holdings Pte Ltd, the Singapore Court of Appeal confirmed that only contract variations supported by consideration are legally binding, rejecting the suggestion that the acceptance of practical benefits has so diluted the doctrine of consideration as to render the requirement illusory. Subsequently, in Charles Lim Teng Siang v Hong Choon Hau, the Singapore Court of Appeal declined to follow the UK Supreme Court's reasoning in MWB Business Exchange Centres Ltd v Rock Advertising Ltd, holding (obiter) that no oral modification clauses do not inevitably invalidate subsequent oral modifications. This note evaluates both decisions and concludes that their combined effect is to endorse a flexible framework for contractual variations in Singapore. The framework builds on the conception of contractual variations as a complex phenomenon encompassing both one‐off exchanges for value and cooperative adjustments to ongoing contracts. Nevertheless, its dominant focus is to promote enterprise through the enhancement of party autonomy.