Can they sue for the costs involved.

[Globaliser]

Originally Posted by Lotpax

In the event of such flight cancellation or changes to the schedule so as to depart more than four (4) hours before or after the scheduled departure time, the Passenger may elect, either:

1. To be carried at the earliest opportunity on another of our scheduled services on which space is available without additional charge and, where necessary, extend the validity of your booking; or
2. ...

Was this option not offered by Tiger?

I think that there are many airlines on which (legislation aside) this would be the primary remedy in this type of situation. If the passenger chooses instead to accept the cancellation and take a refund, then that's the passenger's choice - as is the higher cost of the alternative routing to get to the destination.