Cosmic Insurance Corp Ltd v United Oil Company Pte Ltd
| Jurisdiction | Singapore |
| Judge | Tan Boon Khai |
| Judgment Date | 03 October 2005 |
| Neutral Citation | [2005] SGDC 201 |
| Court | District Court (Singapore) |
| Published date | 23 November 2005 |
| Year | 2005 |
| Plaintiff Counsel | K Anparasan / Nadia Almenoar (KhattarWong) |
| Defendant Counsel | Michael Eu Hai Meng (Comlaw LLC) |
| Subject Matter | Employment Law,Right of employer of injured workman, or his insurer, to claim indemnity from third-party tortfeasor for any compensation paid to workman,Insurer reimbursing insured for hospitalisation and medical expenses paid by insured to hospital in respect of insured's employee,Insurer claiming indemnity pursuant to s 18(b) Workmen's Compensation Act against tortfeasor for hospitalisation and medical expenses as well as adjuster's fees,Whether insured contributorily negligent for workman's injuries,Whether amounts claimed by insurer "compensation" within meaning of s 18(b),Section 18(b) Workmen's Compensation Act (Cap 354, 1998 Rev Ed),Words and Phrases,"Compensation" |
| Citation | [2005] SGDC 201 |
| 3 Oct 2005 |
Judgment reserved |
District Judge Tan Boon Khai:
Introduction
1 The present proceedings raise an interesting legal issue. It pertains to whether the Plaintiffs, as insurers of an employer, are entitled to claim against the Defendants, the tortfeasor in an accident, under section 18(b) of the Workmen’s Compensation Act (Cap. 354) (“WCA”) for medical expenses paid out on behalf of an injured workman/employee, notwithstanding that the said workman/employee had rejected compensation assessed under the WCA, and had proceeded in a common law action to recover damages from the Defendants. Section 18(b) of the WCA states that:
‘Remedies both against employer and stranger
18. Where any injury for which compensation is payable under this Act was caused under circumstances creating a legal liability in some person other than the employer to pay damages in respect thereof —
(a) …
(b) if the workman has recovered compensation under this Act, the person by whom the compensation was paid, and any person who has been called upon to pay an indemnity under section 17 (3), shall be entitled to be indemnified by the person so liable to pay damages as aforesaid.’
2 In the Court of Appeal decision of Singapore Bus Service Ltd v Lim Swee Pheng & Sons (Pte) Ltd
‘7. … Where the workman or his dependants elect to claim and recover compensation under the Act when his injury was caused by the wrongful act, of a ‘stranger’, s 18(b) provides that the wrongdoer should not escape the consequences of his wrongful act by giving the workman’s employer an entitlement to be indemnified by the wrongdoer in respect of the compensation which he has paid.’
3 At the conclusion of the hearing, and after considering parties’ respective submissions both in law and in fact, I answered the above question in the negative, and accordingly dismissed the Plaintiffs’ claim.
4 The Plaintiffs, being dissatisfied with my judgment, have asked for leave to appeal to the High Court under section 21(1) of the Supreme Court of Judicature Act (Cap. 322), as the value of their claim fell below $50,000.00 in value. In view of the unique and interesting point of law canvassed by parties in this case, I granted such leave. I now give the reasons for my decision in the substantive proceedings itself.
Background facts
5 The background factual matrix of this case is fairly straightforward and largely undisputed. In the Defendants’ Closing Submissions, the Defendants set out a Statement of Agreed Facts between parties, which I adopted in the following paragraphs setting out the background to this case.
6 The Plaintiffs are at all material times an insurance company carrying on the business of general insurance in Singapore. Their registered address is at 410, North Bridge Road, #01-00, Singapore 188726.
7 As for the Defendants, they are a company carrying on the business of storing and blending oils, additives and lubricants, and have a factory located at 14 Tuas Drive 2, Singapore (“the factory”).
8 Since August 1999, Protec Guards Management Services (“Protec”), a company in the business of providing security guards, escort services and other general security services on commercial, industrial and private premises, has provided the Defendants with a security guard at the factory. Amongst other duties, this security guard, who is under the employment of Protec, maintains general security at the factory.
9 As an employer, Protec takes out Workmen’s Compensation Insurance Policies with the Plaintiffs for its employees, as required under section 23(1) of the WCA. For present purposes, the relevant insurance policy is Workmen’s Compensation Policy No. PWC000-00001962 (“the policy”), which the Plaintiffs issued to Protec on 27 July 2000. The policy was valid for the period between 19 July 2000 and 18 July 2001, and insured Protec against any liability that Protec may incur against its employees under the WCA. The exact terms of the insurance coverage as stated in the policy was as follows:
‘NOW THIS POLICY WITNESSETH that if any workman in the Insured’s [i.e. Protec’s] employment shall sustain personal injury by accident or disease caused during the Period of Insurance and arising out of and in the course of his employment by the Insured in the Business, the Corporation [i.e. the Plaintiffs] will subject to the terms exceptions conditions and warranties, and any memorandum if applicable, contained herein or endorsed hereon (all of which are hereinafter collectively referred to as the Terms of this Policy) indemnify the Insured against all sums for which the Insured shall be liable to pay compensation either under the Legislation or at Common Law, and will in addition pay all costs and expenses incurred by the Insured with the written consent of the Corporation.’
10 Both the Plaintiffs and Defendants accept that this policy was an “approved policy” within the definition of section 23 of the WCA.
The accident
11 According to Protec’s General Manager, one Mr Naushad Ali s/o Jabarulla Khan (“Naushad”), sometime on 2 November 2000, Protec’s regular security guard at the factory was not available for security duties. As a consequence, Protec dispatched another of their employees, one Samuel Palraj (“Samuel”), to cover these security duties and to guard and protect the factory. Samuel had commenced employment with Protec only on 28 October 2000, and it was not disputed by parties that this was the first time that Samuel had been deployed to the factory, and was unfamiliar with the premises.
12 Unfortunately, on the very same afternoon, Samuel met with an accident at the factory (“the accident”). According to a Ministry of Manpower Investigation Report filed after the accident, the said accident occurred when one Tan Ah Tee, a forklift driver employed by the Defendants, collided into Samuel as he was driving a forklift around the factory loading and unloading goods in the loading and unloading bay area of the factory. As a result of the accident, Samuel broke his left arm, and had his right leg amputated. He is now wheelchair bound, and continues to suffer the adverse effects from this traumatic accident.
13 Shortly after Samuel was injured on 2 November 2000, he was conveyed to the National University Hospital (“NUH”) for immediate treatment. Around the same time, at the request of NUH, Protec was asked to provide an indemnity to NUH for payment of Samuel’s medical treatment, fees and expenses incurred at the hospital. Naushad clarified that he informally consulted Protec’s insurance brokers, M/s Bess General Insurance Agency (“Bess General Insurance”), of NUH’s request, and was informed that the providence of such an indemnity was acceptable, given that Protec was covered by insurance. Protec went on to provide the indemnity, and thereafter paid Samuel’s medical and hospitalisation bills as and when NUH sent such bills to Protec.
14 Consequently, sometime in 2000 or 2001, Protec made various claims against the Plaintiffs under the policy for some of the medical and hospitalisation expenses paid by them on behalf of Samuel. These claims came up to around $48,000.00, of which the Plaintiffs, after assessing them, reimbursed Protec, through Bess General Insurance, an amount of $44,215.45. Naushad explained in the course of his cross-examination that the reason why Protec did not claim for reimbursement of all of Samuel’s medical and hospitalisation expenses incurred at NUH was because he was informed that the Plaintiffs were going through some financial difficulties at that particular time, and hence it would be difficult to get full reimbursement from them. As a result, Protec only followed up with the Plaintiffs on those medical and hospitalisation expenses that were of substantial amounts. These expenses, the details of which are stated below, now form the subject matter in the present proceedings that the Plaintiffs claimed were entitled to be recovered by them from the Defendant under section 18(b) of the WCA:
(i) the sum of $25,473.32 paid by the Plaintiffs to Protec on 25 April 2001, being medical expenses incurred by Samuel on 2 November 2000; and,
(ii) the sum of $18,742.13 paid by the Plaintiffs to Protec on 25 July 2001, being medical expenses incurred by Samuel on 2 November 2000.
The Plaintiffs’ Claim
15 The Plaintiffs’ claim may be summarised in a nutshell as follows: sometime on 18 March 2004, the Plaintiffs commenced these proceedings against the Defendants claiming for the two abovestated sums (i.e. $44,215.45), as well as an amount of $3,578.00 being adjusters’ fees. The platform relied by the Plaintiffs in support of their claim (as pleaded in the Statement of Claim) was as follows:
(i) that Samuel had made a claim against Protec for his medical expenses and/or loss of wages and/or injuries, and that pursuant to the policy, the Plaintiffs, being the insurers of Protec, were liable to and did compensate Samuel in the sum of $44,215.45; and,
(ii) that the Plaintiffs, by virtue of section 18(b) of the WCA, were entitled to claim against the Defendants for an indemnity in respect of monies paid out by them to Samuel, for damages in respect of personal injuries and consequential losses as a result of the accident.
The Defendants’ Defence
16 The Defendants’ Defence rested on the few fronts, and they may be summarised in the following manner: first, the Defendants asserted that Protec had caused and/or contributed to the accident. Therefore, the Plaintiffs were not entitled in law to rely on section 18(b).
17 In addition, the Defendants also denied that the Plaintiffs were entitled to bring these proceedings against them under section 18(b) of the WCA, in that:
(i) the amounts claimed by the Plaintiffs were not compensation within the meaning of the WCA, hence Samuel did not recover any compensation under the WCA;
(ii) Samuel did not make any claim against...
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