I have reached a settlement agreement arising from a dispute between two companies and the other party is requesting that I pay the settlement into a personal off-shore account of one of the directors

Previously the wording of the offer to settle included

The Sum shall be paid to Party 1 or to us as their solicitors in full within 3 business days from the date of written acceptance of this offer, and shall not be subject to any set-off or deduction by Party 2

We offered to pay the other party's solicitors the amount agreed in the settlement offer as per their instructions and they have refused, instead insisting the funds be paid to the other party's director's personal bank account. As this is a dispute between two businesses I feel extremely uncomfortable paying an individual personal account to settle the dispute.

What rights do I have to enforce the payment method of the settlement agreement?

1 Answer 1


What rights do I have to enforce the payment method of the settlement agreement?

Although you use the past tense in "Previously the wording [...] included", I gather that the record that memorializes the settlement has not been modified.

It is important to ascertain who proposed or drafted the wording "paid to Party 1 or to us as their solicitors" (the OR clause"), since that would determine whether you may resort to the doctrine of contra proferentem and therefore be entitled to decide to whom you opt to make the payment. Items 12.65-12.67 here reflect that contra proferentem is cognizable under Singapore law.

But note that item 12.66 highlights one complication of which you need to be aware (and to overcome):

if the contract were bilaterally negotiated, then the contra proferentem rule would not apply [...] where the clause 'emerged as a result of joint efforts' [...] [or] a joint drafting effort.

This is a clear-cut example of absurdity (on the part of whoever came up with those holdings) because many, many contracts are the result of negotiations --thus amounting to joint efforts--, and yet that fact does not imply that the parties to such contracts have comparable bargaining power. And not only a settlement is a typical example of "bilaterally negotiated contract", but the process and/or confidentiality of settlement fine-tuning makes it harder to prove who proposed what.

That being said, two details suggest that Party1/its solicitors (not you) proposed/drafted the OR clause: (1) the language "to us" in reference to one of the alternatives about payment, and (2) the rarity for a payer (unless his bargaining power is significantly greater) to impose a list of options of to whom exactly he may choose pay. If Party1 refuted in court the application of contra proferentem, you might want to argue your position from this angle.

Another relevant but unclear detail is whether or not the settlement truly contains any "instructions" pursuant to payment to an offshore-account. If it does not, then Party 1 would have a harder time arguing the legitimacy of his post-settlement preference.

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    The fact that it employs the first person pronoun "us" does imply that it was drafted by the other party. Apr 26, 2019 at 19:01
  • @Acccumulation Taken in isolation, you are right. But in the OP's context of settlement that involves & makes reference to solicitors, and with that clause establishing one of the OP's duties, it is much likelier that it was the other party who required/proposed/drafted the clause. Ultimately, only the OP knows who the proferens is because that detail is unclear from his post. Apr 26, 2019 at 19:31
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    I don't follow the reasoning here. Why would we invoke the contra proferentem rule? Where is the ambiguity in the clause? What possible interpretation is there other than the fact that payment to either Party 1 or the solicitor within 3 days will satisfy the requirement?
    – JBentley
    Sep 12, 2021 at 17:26
  • @JBentley "What possible interpretation is there other than the fact that payment to either Party 1 or the solicitor within 3 days will satisfy the requirement?" There is none other than that. The doctrine is premised precisely on the conjunction "to Party 1 or to us as their solicitors". The draftsman is not entitled to choose between Party 1 or its solicitor. Only the non-draftsman has that entitlement. Sep 12, 2021 at 18:07
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    @IñakiViggers I think you've misunderstod the doctrine. It is invoked when there are multiple possible interpretations of a clause. In that case you choose the interpretation which favours the non-drafter. In this case there is only one possible interpretation, so there is no need to invoke the doctrine.
    – JBentley
    Sep 12, 2021 at 18:12

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