The advertising agency wins a substantial sum due to a cancelled video advertisement project for the Subaru Forester, which was then sued against.
The advertising agency did a shoot in Malaysia before producing five draft videos, which were rejected by the client. A generic photo of a Subaru Forester, often marketed as a compact crossover sport utility vehicle.
Add CNA as a trusted source to help Google better understand and surface our content in search results. SINGAPORE: An advertising agency has won more than S$164,000 in liquidated damages over a cancelled video advertisement project it did for the Subaru Forester vehicle. Motor Image Enterprises, the sole distributor for Subaru vehicles in Singapore, was ordered to foot the sum after contesting the case against AP Media.
The video project was to capture the Subaru Forester's concept of adventure, with Motor Image Enterprises envisioning multiple video ads where virtual technology would give the appearance of the ads being shot in different countries although there was only one live shoot. AP Media did"considerable work" for the ad, but after reviewing five draft videos, Motor Image Enterprises assessed that the agency would not be able to deliver the ad to its satisfaction.
AP Media was never paid and the video ad never came to fruition. The agency then launched a suit on the basis of a breach of contract. In September 2023, representatives from both sides met to talk about the virtual production of a video ad for the Subaru Forester. AP Media started work shortly after this meeting and later sent a fee quote with a contract price of S$301,200.
The payment terms specified that 50 per cent of the fees was to be paid on confirmation of the project, and the other half upon delivery. It also stated that in the event of cancellation, the customer is required to pay 50 per cent compensation on the full amount of the order. Motor Image Enterprises accepted the fee quote in November 2023 and issued a purchase or works order to AP Media.
The live shoot for the ad took place in Malaysia in December 2023. Over about a month, AP Media provided five draft videos to Motor Image Enterprises. The distributor gave feedback on the videos, but was not happy with them. AP Media made several requests and demands for payment but none were made.
District Judge Jonathan Ng Pang Ern found that a valid contract had been formed when Motor Image Enterprises accepted the fee quote, and that the company had breached the contract.
"Despite having put the claimant to considerable work on the project, the defendant refused to make payment because it assessed that the claimant would not be able to deliver the video advertisement to its satisfaction," the judge said. "Instead, it is whether the defendant was entitled to refuse payment. " Judge Ng said that the defendant had raised"a litany of defences to impugn the parties' contract from its formation right through to the remedy for its breach".
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Subaru Advertising Agency Legal Proceedings Liquidated Damages Motor Image Enterprises AP Media Virtual Production Shoot In Malaysia
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