Civil Law And Sustainable Development Project Contract Disputes In Singapore .

1. Introduction

Sustainable development project contract disputes in Singapore arise when parties involved in environmentally sustainable infrastructure, renewable energy, green buildings, water-management systems, low-carbon transportation, waste-management facilities and other sustainability-related projects disagree over their contractual rights and obligations.

These disputes may involve:

Government agencies and private developers.

Construction companies and engineering contractors.

Renewable energy developers and electricity purchasers.

Green-building consultants and certification bodies.

Infrastructure investors and project financiers.

Environmental technology suppliers.

Subcontractors and equipment manufacturers.

Landowners and project operators.

Singapore's sustainable development programme increasingly involves major infrastructure investments, environmental compliance, energy transition and resource-efficiency initiatives.

Such projects frequently depend on complex contractual arrangements involving construction deadlines, technical performance standards, environmental obligations, financing conditions and long-term operational commitments.

Central legal question: Who bears civil liability when a sustainable development project fails to achieve its contractual, environmental, technical, financial or operational objectives?

Singapore does not have one consolidated statute governing all sustainable development project contracts. These disputes are resolved through ordinary contract law, construction law, statutory environmental requirements, arbitration principles and applicable sector-specific legislation.

2. Meaning and characteristics of sustainable development project contracts

A sustainable development project contract is an agreement for designing, financing, constructing, supplying, operating or maintaining infrastructure or services intended to promote environmental protection, resource efficiency or sustainable economic development.

Major categories

Project categoryExamples of contractual arrangements
Renewable energySolar farms, rooftop solar installations
Green buildingsGreen Mark-certified commercial buildings
Sustainable transportationElectric vehicle infrastructure, rail systems
Water sustainabilityDesalination and water-recycling facilities
Waste managementRecycling and waste-to-energy plants
Sustainable urban developmentSmart districts and low-carbon housing
Environmental remediationContaminated land restoration
Carbon reductionCarbon capture and emissions-reduction projects

Conservatories, Gardens By The Bay | Grant Associates

 

 

3M launches 14,000 sq m solar farm in Tuas | The Straits Times

 

 

Singapore's world-first integrated waste and water treatment facility hit by construction delays | News | Eco-Business | Asia Pacific

 

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Distinctive contractual characteristics

Sustainable development contracts often contain obligations that go beyond ordinary construction agreements.

These include:

Environmental performance guarantees.

Energy-efficiency requirements.

Carbon-emission reduction commitments.

Sustainable material procurement obligations.

Green certification requirements.

Waste-management and recycling obligations.

Long-term maintenance and operational requirements.

Regulatory compliance warranties.

A project can be physically completed yet still be contractually defective if it fails to achieve an expressly guaranteed environmental or technical performance standard.

3. Legal framework governing sustainable development project contracts in Singapore

A. Contract law

Singapore's common-law principles of contract formation, interpretation, performance and breach are fundamental.

A claimant generally needs to establish:

Existence of a valid contract.

Relevant contractual obligations.

Breach by the defendant.

Causation.

Recoverable loss.

Contractual disputes may concern construction delays, inadequate environmental performance, defective equipment, inaccurate sustainability representations or failure to meet agreed operational standards.

B. Building and Construction Industry Security of Payment Act 2004

The Security of Payment Act (SOPA) is important in construction-related sustainable development projects.

It provides a statutory adjudication mechanism for eligible payment disputes arising from construction contracts.

It is particularly relevant where:

A contractor is not paid for completed work.

A subcontractor disputes withheld payments.

A developer disputes progress claims.

A contractor claims payment for variations.

Parties disagree about the value of completed construction work.

Adjudication provides an interim payment-resolution mechanism without necessarily determining the parties' ultimate contractual rights.

C. Building Control Act 1989

The Building Control Act regulates building works and relevant safety and technical requirements.

It may become relevant where green-building projects involve:

Structural defects.

Non-compliant building materials.

Improper installation of energy systems.

Building-plan approval failures.

Defective engineering work.

Contractual compliance with a green-building specification does not remove the need to satisfy applicable building regulations.

D. Environmental Protection and Management Act 1999

This legislation regulates various environmental matters, including pollution-related activities.

It may affect sustainable development projects involving industrial installations, emissions, waste and environmental controls.

Where a contractor's breach causes environmental harm, the dispute may involve both contractual liability and independent statutory obligations.

E. Energy-related legislation

Renewable energy projects may involve the Electricity Act 2001 and applicable energy-market requirements.

Disputes may concern:

Electricity generation and supply obligations.

Grid connection.

Energy-system performance.

Licensing and regulatory compliance.

Equipment failures.

Metering and electricity delivery.

F. Land acquisition and property law

Sustainable infrastructure projects may require land access, easements, leases, rights of way and compulsory acquisition.

Disputes can therefore involve the Land Acquisition Act 1966, Land Titles Act 1993 and ordinary property-law principles.

G. Arbitration Act 2001 and International Arbitration Act 1994

Large infrastructure and renewable-energy contracts frequently contain arbitration clauses.

Depending on the nature of the arbitration and the parties involved, the domestic Arbitration Act or International Arbitration Act may apply.

These frameworks provide mechanisms for resolving complex technical and commercial disputes.

4. Important Singapore case laws

The following cases are particularly useful for analysing sustainable development project disputes. Some directly concern solar-energy infrastructure, while others establish construction-contract principles applicable to renewable energy, green buildings and sustainable infrastructure.

Case 1. Terrenus Energy SL2 Pte Ltd v Attika Interior + MEP Pte Ltd [2023] SGHC 333

Direct solar-energy project dispute

Court: General Division of the High Court.

Facts:

Terrenus Energy engaged Attika Interior + MEP as the main contractor for the construction of a ground-mounted solar generation facility and a linkway solar generation facility at Changi Business Park.

The parties entered into a lump-sum construction contract.

Disputes arose concerning:

Delay in completing the solar facilities.

Alleged construction defects.

Installation of supporting rods.

Compliance with technical specifications.

Extension-of-time claims.

Liquidated damages.

Payment for additional work.

Terrenus claimed damages for delay and defects, while Attika disputed liability and sought outstanding contractual payments.

Legal principles:

The High Court examined the contractual allocation of construction responsibilities, the scope of work, defects, extension of time and damages.

The case demonstrates that a contractor must perform the work according to the agreed technical specifications.

A contractor cannot automatically avoid liability by arguing that the project was substantially completed if important contractual requirements remain unsatisfied.

Application to sustainable development:

This is especially important for solar projects.

For example, if a contractor installs solar panels but fails to provide the specified supporting structures, electrical components or installation standards, the developer may pursue contractual remedies.

The case is directly relevant to solar infrastructure construction and the enforcement of technical obligations.

Case 2. Zynergy Solar Projects & Services Pvt Ltd v Phoenix Solar Pte Ltd [2017] SGHC 223

Court: High Court of Singapore.

Facts:

This case concerned a contractual dispute arising from the development of a solar power plant in India.

The parties were involved in a supply contract relating to the development of the power plant.

The project encountered significant operational problems, including:

Serious losses in power generation.

Discolouration and burn marks on solar panels.

Failure of inverters.

Unresolved technical problems.

The parties subsequently entered into a debt settlement agreement.

The claimant alleged that it entered into the settlement agreement in reliance on a representation that the defendant would work towards resolving the underlying solar-plant problems.

An arbitration award was subsequently made in favour of the defendant.

The claimant challenged the award and sought relief connected with the alleged failure of the solar project.

Legal principles:

The case demonstrates the importance of distinguishing between:

Original contractual obligations.

Subsequent settlement agreements.

Representations made during settlement negotiations.

Obligations arising from an arbitration agreement.

Alleged failures in the performance of solar infrastructure contracts.

Application to sustainable development:

A renewable energy contractor may be liable where its contractual obligations concerning equipment performance, technical reliability or project delivery are not fulfilled.

However, a later settlement agreement may independently affect the parties' rights and available remedies.

This is an important Singapore authority for disputes involving solar-energy supply arrangements and project-performance failures.

Case 3. CAA Technologies Pte Ltd v Newcon Builders Pte Ltd [2017] SGCA 53

Court: Court of Appeal of Singapore.

Facts:

This case involved a construction subcontract and disputes concerning project delays, contractual obligations and termination.

The parties disagreed about responsibility for delays and the contractual consequences of the parties' conduct.

The Court of Appeal examined issues involving implied contractual terms, delay compensation and causation.

Legal principles:

The decision is relevant to determining:

Whether contractual terms can be implied.

Whether a party has breached its contractual obligations.

Whether delay-related losses were caused by the alleged breach.

Whether contractual termination was justified.

Application to sustainable development:

In a green-building project, a subcontractor may be responsible for supplying specialised environmental equipment.

If late delivery of that equipment delays the entire project, the developer or main contractor may seek compensation.

However, the claimant must establish the relevant contractual obligation and causal connection between the breach and the loss.

Case 4. Comfort Management Pte Ltd v OGSP Engineering Pte Ltd and another [2020] SGHC 165

Court: General Division of the High Court.

Facts:

This dispute arose from a lump-sum construction contract for a project in Jurong.

The parties disagreed about:

The proportion of work completed.

Whether the contractor had been overpaid.

Construction delays.

Liquidated damages.

Defects.

Variation orders.

Additional work performed outside the original scope.

The court found that the contractor had completed 95.29% of the works as at the relevant assessment date.

It also found that the employer was entitled to recover S$81,000 in liquidated damages for 162 days of delay.

The contractor obtained relief concerning certain variation claims and additional work.

Legal principles:

The decision illustrates the importance of:

Measuring actual work completed.

Distinguishing original contractual work from variations.

Establishing entitlement to additional payment.

Assessing delay and liquidated damages.

Determining the appropriate value of work performed outside the contractual scope.

Application to sustainable development:

Suppose a developer engages a contractor to construct a water-recycling facility for a fixed price.

During construction, the developer requests additional filtration equipment and modifications to the recycling system.

A dispute may arise over whether these changes are included in the original contract or constitute separately payable variations.

This case provides useful guidance on resolving such disputes.

Case 5. Robertson Quay Investment Pte Ltd v Steen Consultants Pte Ltd [2008] SGCA 8

Court: Court of Appeal of Singapore.

Facts:

The case concerned construction delays and additional interest incurred on construction loans.

The claimant sought to recover the additional financing costs resulting from delayed completion of the project.

The dispute raised questions about contractual damages, causation, remoteness and proof of loss.

Legal principles:

The Court of Appeal examined the principles governing recoverable contractual damages.

The decision is particularly important for the following propositions:

Loss must be sufficiently connected to the breach.

The rules concerning remoteness of contractual damages must be applied.

A claimant must prove the loss it seeks to recover.

Courts adopt a practical and fact-sensitive approach to evidence of damages.

Application to sustainable development:

Sustainable infrastructure projects often involve substantial project financing.

If a contractor delays a solar farm or green commercial building, the developer may incur:

Additional construction-loan interest.

Increased financing expenses.

Delayed revenue.

Additional project-management costs.

Other foreseeable losses.

This decision helps determine whether such losses are legally recoverable.

Case 6. Crescendas Bionics Pte Ltd v Jurong Primewide Pte Ltd [2023] SGHC(A) 9

Court: Appellate Division of the High Court.

Facts:

The dispute concerned delayed completion of a construction project.

The parties disagreed over responsibility for delay, extension of time and the appropriate assessment of damages.

A particularly important issue was the effect of the employer's own conduct in delaying the project.

The court considered whether the contractor remained subject to the original contractual completion deadline and whether liquidated damages could still be claimed.

Legal principles:

The case demonstrates that an employer cannot necessarily rely on a contractual completion date and liquidated-damages clause where its own conduct has prevented timely performance.

Where time becomes at large, the contractor may still be required to complete within a reasonable time.

The employer may then pursue general damages if the contractor fails to do so.

Application to sustainable development:

Consider a renewable-energy project where the developer delays providing site access, design approvals or technical information.

The developer may not be entitled to impose delay penalties for the period attributable to its own conduct.

The case is important for allocating project-delay risks fairly.

Case 7. ICOP Construction (SG) Pte Ltd v Tiong Seng Civil Engineering (Pte) Ltd [2024] SGHC(A) 1

Court: Appellate Division of the High Court.

Facts:

This case involved construction subcontract disputes relating to project delays, approvals, equipment rental and contractual damages.

The parties disagreed over responsibility for delays and the financial consequences of the delay.

One important issue concerned the delay in obtaining approvals from the relevant authorities.

Legal principles:

The decision demonstrates that:

Delay in obtaining regulatory approvals may create contractual liability depending on the allocation of responsibility.

The claimant must establish the loss resulting from the delay.

The proper measure of damages depends on the contractual and factual circumstances.

Liquidated damages and general damages must be distinguished.

Application to sustainable development:

Environmental and infrastructure projects often require numerous approvals.

For example, a waste-to-energy facility may depend on planning, building, environmental and operational approvals.

If the party responsible for securing those approvals fails to do so within the contractual period, it may face delay-related claims.

Case 8. Vim Engineering Pte Ltd v Deluge Fire Protection (S.E.A.) Pte Ltd [2023] SGHC(A) 2

Court: Appellate Division of the High Court.

Facts:

The dispute arose from subcontracted plumbing, sanitary and gas works on a construction project.

The parties disagreed over contractual specifications, defects and responsibility for rectification.

The appellate court considered the significance of giving a contractor notice and an opportunity to rectify defects under a defects-liability clause.

Legal principles:

The court explained that contractual notification requirements can give a contractor the opportunity to remedy defects at a lower cost.

Failure to comply with such a notification requirement may prevent an employer from relying on the particular defects clause.

However, the employer's separate right to claim damages for the cost of repairs may remain.

The amount recoverable may be affected by whether the contractor was given a contractual opportunity to undertake the remedial work.

Application to sustainable development:

In green-building projects, defects may involve:

Solar panel mounting systems.

Water filtration installations.

Energy-management equipment.

Fire-protection systems.

Insulation and ventilation systems.

A developer should follow the contractually prescribed inspection, notification and rectification procedures before arranging expensive third-party repairs.

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5. Major categories of sustainable development project disputes

A. Renewable energy construction disputes

These disputes arise when contractors fail to deliver renewable energy installations according to contractual requirements.

Examples:

Solar panels producing less electricity than guaranteed.

Wind-energy equipment failing technical inspections.

Inverters malfunctioning.

Renewable-energy installations experiencing structural defects.

Contractors failing to meet commissioning deadlines.

Possible remedies: Damages, rectification, replacement, termination and contractual indemnification.

B. Green-building certification disputes

Green-building projects may involve contractual commitments to achieve specified environmental certification standards.

Disputes may arise where:

A developer promises a particular Green Mark rating.

Consultants fail to design buildings according to agreed environmental specifications.

Contractors use non-compliant construction materials.

Energy-efficiency targets are not achieved.

Certification is refused because of design or construction defects.

The parties must distinguish between an express contractual guarantee of certification and an obligation merely to exercise reasonable professional skill and care.

C. Environmental compliance disputes

These disputes arise when contractors or developers fail to comply with environmental requirements incorporated into their agreements.

Examples include:

Improper disposal of construction waste.

Excessive dust or noise.

Failure to implement pollution-control measures.

Contamination caused by construction activities.

Failure to undertake agreed environmental remediation.

A contractual breach may coexist with independent statutory or regulatory liability.

D. Sustainable infrastructure financing disputes

These disputes concern the financial structure of environmentally sustainable projects.

Examples:

Failure to release project-financing funds.

Breach of green-loan conditions.

Misrepresentation of environmental performance.

Failure to satisfy financing milestones.

Disagreement over carbon-reduction-linked payments.

The contractual treatment of environmental performance indicators is particularly important.

E. Water-management project disputes

Singapore's water sustainability infrastructure may involve desalination, water recycling and wastewater treatment facilities.

Disputes may concern:

Failure to achieve water-treatment capacity.

Equipment malfunction.

Failure to satisfy water-quality specifications.

Delayed commissioning.

Improper maintenance.

F. Electric vehicle infrastructure disputes

These disputes may arise from contracts for charging stations, electrical connections and related infrastructure.

Examples include:

Charging equipment failing to meet performance requirements.

Grid connection delays.

Software compatibility problems.

Failure to meet agreed installation deadlines.

Disputes over maintenance obligations.

6. Contractual clauses particularly important to sustainable development projects

The following clauses can substantially reduce disputes.

Contractual clauseLegal purpose
Environmental performance clauseDefines sustainability obligations
Carbon-reduction clauseEstablishes emissions targets
Technical specification clauseDefines required equipment and standards
Green certification clauseAllocates certification responsibility
Completion clauseEstablishes project deadlines
Extension-of-time clauseAllocates delay risks
Liquidated damages clauseDetermines agreed delay compensation
Variation clauseRegulates additional work
Defects-liability clauseProvides a mechanism for rectification
Force majeure clauseAllocates exceptional-event risks
Indemnity clauseAllocates specified financial liabilities
Termination clauseEstablishes grounds for ending the agreement
Dispute-resolution clauseDetermines how disputes are resolved

Importance of environmental performance guarantees

A particularly important contractual issue is the difference between an environmental objective and an enforceable performance guarantee.

For example:

An obligation to use reasonable efforts to reduce emissions is different from a guarantee of a specified emissions reduction.

An obligation to design a green building is different from a guarantee that it will obtain a particular certification.

An obligation to install solar panels is different from guaranteeing a minimum electricity output.

Contracts should specify measurement methods, testing periods, acceptable tolerances and consequences of non-performance.

7. Remedies available to injured parties

A. Compensatory damages

A party suffering loss because of contractual breach may claim damages.

Potential losses include:

Cost of repairing defective equipment.

Additional construction expenses.

Additional financing costs.

Lost project revenue.

Cost of replacing non-compliant materials.

Reasonable costs of completing unfinished work.

The claimant must establish causation, remoteness and proof of loss.

B. Liquidated damages

Construction contracts frequently provide for predetermined damages when a project is completed late.

For example, a contract may require a contractor to pay S$10,000 for each day of delay.

The enforceability of such a clause depends on applicable contractual principles, including the law governing penalties.

C. Specific performance

A court may order a party to perform contractual obligations where monetary damages would not provide an adequate remedy and the relevant equitable requirements are satisfied.

This may be relevant to particular infrastructure or land-related contractual obligations, although specific performance is not automatically available for construction contracts.

D. Rescission and termination

A party may seek to terminate a contract where the other party commits a sufficiently serious breach or where a valid contractual termination provision is triggered.

For example, persistent failure to achieve a fundamental contractual performance requirement may justify termination, depending on the agreement.

E. Restitution and repayment

Where a contract has been rescinded or payments have been made without an adequate legal basis, restitutionary relief may be available.

F. Injunctions

An injunction may be relevant where continuing conduct threatens contractual rights or causes harm that cannot adequately be addressed through damages.

8. Dispute-resolution mechanisms

Sustainable development contracts often involve multiple contractors, consultants, financiers and government authorities.

Consequently, efficient dispute resolution is important.

MechanismApplication
NegotiationInitial settlement of commercial disagreements
MediationResolving technical and commercial conflicts
Statutory adjudicationEligible construction payment disputes under SOPA
ArbitrationComplex domestic or international project disputes
LitigationCourt determination of contractual claims
Expert determinationTechnical disputes involving performance or engineering

A. Construction adjudication

SOPA adjudication is particularly useful for construction payment disputes.

For example, a subcontractor constructing a solar installation may submit a payment claim for completed work.

If the main contractor disputes the claim or fails to pay, the subcontractor may pursue statutory adjudication if the contract and claim fall within the Act.

B. Arbitration

International sustainable development projects frequently involve foreign contractors, international investors and overseas technology suppliers.

Arbitration can provide a neutral forum for resolving disputes.

However, the arbitration agreement, applicable legislation, seat of arbitration and enforceability of the award must all be considered.

C. Court litigation

The Singapore courts may be involved in:

Contractual damages claims.

Enforcement of contractual rights.

Applications concerning arbitration.

Enforcement of adjudication determinations.

Construction defect litigation.

Disputes involving environmental or property obligations.

9. Burden of proof and evidence

A party bringing a sustainable development contract claim must establish the relevant contractual breach and the loss suffered.

Important evidence includes:

Original construction contract.

Technical specifications.

Environmental performance reports.

Green-building certification documents.

Engineering inspection reports.

Solar or energy-generation records.

Construction progress certificates.

Payment certificates.

Environmental monitoring records.

Correspondence concerning delays and defects.

Expert engineering reports.

Project-financing and loss calculations.

Expert evidence is particularly important.

For example, where a developer claims that a solar installation produces 30% less electricity than guaranteed, technical evidence may be needed to establish whether the shortfall resulted from defective installation, equipment failure, weather conditions, maintenance issues or other causes.

10. Challenges in sustainable development contract litigation

1. Unclear environmental performance obligations

Contracts sometimes use expressions such as environmentally friendly, energy efficient and carbon neutral without defining measurable standards.

This creates uncertainty concerning contractual compliance.

2. Technological obsolescence

Renewable-energy technology changes rapidly.

Equipment that satisfied technical specifications when the contract was signed may become outdated before project completion.

3. Multiple-party responsibility

Sustainable infrastructure projects involve developers, contractors, engineers, equipment suppliers and consultants.

Identifying the party responsible for a particular failure can be difficult.

4. Regulatory approval delays

Environmental and infrastructure approvals may delay project delivery.

The contract must establish who bears the risk of obtaining approvals and the consequences of delay.

5. Long-term performance uncertainty

Some sustainability obligations extend over 10–25 years.

This creates disputes concerning maintenance, warranties, equipment degradation and future performance.

6. Greenwashing and misleading representations

A developer or contractor may make environmental claims that are not supported by actual project performance.

Such conduct may create contractual misrepresentation issues and potentially other legal consequences.

11. Suggested reforms for Singapore

The following reforms could strengthen the legal framework for sustainable development project contracts.

Proposed reformExpected benefit
Standardised green-project contract termsGreater contractual certainty
Mandatory measurable environmental indicators in specified projectsEasier performance assessment
Clear carbon-performance warrantiesBetter risk allocation
Standardised renewable-energy testing protocolsFewer technical disputes
Improved green-project dispute mediationLower litigation costs
Stronger environmental disclosure requirementsReduced greenwashing
Long-term equipment warranty standardsBetter consumer and investor protection
Improved digital project monitoringBetter evidence preservation

Singapore could also develop specialised model contractual clauses for solar installations, green buildings, water infrastructure and sustainable transport projects.

These are proposed policy improvements, not descriptions of existing universal legal requirements.

12. Important legal principles emerging from the cases

CasePrincipal legal principleSustainable development application
Terrenus Energy v Attika [2023] SGHC 333Solar construction specifications, defects and delaySolar infrastructure
Zynergy Solar v Phoenix Solar [2017] SGHC 223Solar supply obligations and settlement disputesRenewable energy
CAA Technologies v Newcon Builders [2017] SGCA 53Implied terms, delay and causationConstruction subcontracting
Comfort Management v OGSP Engineering [2020] SGHC 165Variations, payment and delay damagesGreen infrastructure construction
Robertson Quay v Steen Consultants [2008] SGCA 8Proof and remoteness of damagesProject financing losses
Crescendas Bionics v Jurong Primewide [2023] SGHC(A) 9Employer-caused delay and time at largeInfrastructure delivery
ICOP Construction v Tiong Seng Civil Engineering [2024] SGHC(A) 1Approval delays and damagesRegulatory project delays
Vim Engineering v Deluge Fire Protection [2023] SGHC(A) 2Defect notification and rectificationSustainable building systems

13. Conclusion

Sustainable development project contract disputes in Singapore represent an important intersection of civil liability, construction law, environmental compliance, infrastructure financing and commercial contract enforcement.

The most directly relevant decisions are Terrenus Energy SL2 Pte Ltd v Attika Interior + MEP Pte Ltd and Zynergy Solar Projects & Services Pvt Ltd v Phoenix Solar Pte Ltd, because they involve actual solar-energy project disputes.

Other decisions establish important principles concerning construction delays, technical defects, variations, payment obligations, causation and damages.

The central legal position is that sustainable development objectives become enforceable contractual obligations when they are properly incorporated into the agreement and sufficiently defined.

A contractor cannot avoid contractual responsibility merely because a project serves an environmentally beneficial purpose. Equally, a developer cannot automatically impose liability for environmental outcomes that the contractor never guaranteed.

The strongest contractual framework therefore combines clearly measurable sustainability obligations, precise technical specifications, transparent allocation of regulatory risks, enforceable performance guarantees and effective dispute-resolution mechanisms.

This analysis is intended for academic and legal research. The cases discussed are construction and infrastructure authorities, not all direct decisions on environmental sustainability obligations.

 

 

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