Bankers & Traders Insurance Co Ltd v Allied Insurance Services

CourtFederal Court (Singapore)
JudgeChoor Singh J
Judgment Date11 December 1968
Neutral Citation[1968] SGFC 20
Citation[1968] SGFC 20
Subject Mattersuffered by one party or benefit accrued to the other party,Consideration,Contract,Definition
Plaintiff CounselLee Boon Siong (Drew & Napier)
Published date19 September 2003
Docket NumberCivil Appeal No Y28 of 1968
Defendant CounselJB Jeyaretnam (JB Jeyaretnam & Co)
Date11 December 1968

The plaintiffs` claim in this case is for the sum of $4,028.78 being money alleged to be payable by the defendants to the plaintiffs for money received by the defendants for the use of the plaintiffs, being the balance due in respect of insurance premiums collected by the defendants in Singapore and Malaya for and on behalf of the plaintiffs. In the alternative the plaintiffs allege that by a letter dated 14 March 1964 the defendants were appointed insurance agents for the plaintiffs and that in consideration, inter alia,of their appointment as agents, the defendants guaranteed in favour of the plaintiffs the payment of all premiums due in respect of policies issued through the defendants` said agency, and further that the sum of $4,028.78 was due to the plaintiffs from the defendants in respect of such premiums.

At the hearing of the action in the court below, the learned trial judge was asked by counsel for both parties to decide the following issue:

(1) Does the letter of appointment dated 14 March 1964 contain a guarantee?

(2) If it does, was there sufficient consideration moving from the plaintiff?

By his judgment the learned trial judge held that the letter of appointment dated 14 March 1964 did not contain a guarantee by the defendants and even if there was a guarantee there was no valuable consideration for the guarantee.
It is against this judgment that the plaintiffs have brought this appeal.

It is not disputed that by the letter dated 14 March 1964 which was written by the plaintiffs to the defendants, the defendants were appointed insurance agents for the plaintiffs.
The terms and conditions of the agency were set out in the said letter of appointment. One of the paragraphs (hereinafter referred to as `para 3`) of the letter reads as following:

You may allow credit for a period not in excess of 90 days and upon the expiration of such credit period, the premiums, if not paid, by the insured will be your liability.

The defendants accepted all the terms and conditions by signing an endorsement at the foot of the letter.
This endorsement reads as follows:

I accept the appointment and undertake to adhere strictly to the terms and conditions thereof.

Counsel for the defendants has submitted that it is essential for the court to decide whether para 3 contains a guarantee or an indemnity because he contends that on the pleadings and the agreed issues before the learned trial judge the defendants must

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