Motor Insurers' Bureau of Singapore and another v AM General Insurance Bhd (formerly known as Kurnia Insurans (Malaysia) Bhd) (Liew Voon Fah, third party)

JurisdictionSingapore
CourtHigh Court (Singapore)
JudgeQuentin Loh J
Judgment Date23 February 2018
Docket NumberSuit No 647 of 2016 (Summons No 4880 of 2016)
Date23 February 2018

[2018] SGHC 39

High Court

Quentin Loh J

Suit No 647 of 2016 (Summons No 4880 of 2016)

Motor Insurers' Bureau of Singapore and another
and
AM General Insurance Bhd (formerly known as Kurnia Insurans (Malaysia) Bhd) (Liew Voon Fah, third party)

Anthony Wee and Pak Waltan (United Legal Alliance LLC) for the plaintiffs;

Niru Pillai, Liew Teck Huat, Priya PillayandAchala Menon (Niru & Co LLC)for the defendant;

Third party unrepresented and absent.

Air Express International (M) Sdn Bhd v MISC Agencies Sdn Bhd [2012] 4 MLJ 59 (refd)

Alfred McAlpine Construction Ltd v Panatown Ltd [2001] 1 AC 518 (refd)

AmGeneral Insurance Bhd v Iskandar bin Mohd Nuli [2016] 1 MLJ 818 (refd)

Beswick v Beswick [1968] AC 58 (refd)

Biffa Waste Services Ltd v Maschinenfabrik Ernst Hese GmbH [2009] PNLR 5 (refd)

Chaplin v Hicks [1911] 2 KB 786 (refd)

Chia Kok Leong v Prosperland Pte Ltd [2005] 2 SLR(R) 484; [2005] 2 SLR 484 (folld)

Coulls v Bagot's Executor and Trustee Co (1967) 119 CLR 460 (refd)

Darlington Borough Council v Wiltshier Northern Ltd [1995] 1 WLR 68 (refd)

Dewan Undangan Negeri Kelantan v Nordin bin Salleh [1992] 1 MLJ 697 (refd)

Eh Riyid v Eh Tek [1976] 1 MLJ 262.1 (refd)

Family Food Court v Seah Boon Lock [2008] 4 SLR(R) 272; [2008] 4 SLR 272 (folld)

Gandy v Gandy (1884) 30 Ch D 57 (folld)

Gregory and Parker v Williams (1817) 3 Mer 582; 36 ER 224 (refd)

Gurtner v Circuit [1968] 2 QB 587 (folld)

Hameed Jagubar bin Syed Ahmad v Pacific & Orient Insurance Co Berhad [2017] MLJU 968 (refd)

Hardy v Motor Insurers' Bureau [1964] 2 QB 745; [1964] 2 All ER 742 (refd)

Harmer v Armstrong [1934] Ch 65 (refd)

Hong Leong Bank Bhd v Staghorn Sdn Bhd [2008] 2 MLJ 622 (refd)

Ikebife Ibeneweka v Peter Egbuna [1964] 1 WLR 219 (refd)

Indulge Food Pte Ltd v Torabi Marashi Bahram [2010] 2 SLR 540 (refd)

Iskandar bin Mohd Nuli v AmGeneral Insurance Bhd [2017] 5 MLJ 25 (not folld)

Ketua Pengarah Jabatan Alam Sekitar v Kajing Tubek [1997] 3 MLJ 23 (refd)

Les Affr�teurs R�unis SA v Leopold Walford (London) Ltd [1919] AC 801 (refd)

Linden Gardens Trust Ltd v Lenesta Sludge Disposals Ltd [1994] 1 AC 85; [1993] 3 WLR 408 (refd)

Lloyd's v Harper (1880) 16 Ch D 290 (refd)

MAE Engineering Ltd v Fire-Stop Marketing Services Pte Ltd [2005] 1 SLR(R) 379; [2005] 1 SLR 379 (folld)

Obegi Melissa v Vestwin Trading Pte Ltd [2008] 2 SLR(R) 540; [2008] 2 SLR 540 (refd)

Pacific & Orient Insurance Co Bhd v Motor Insurers' Bureau of Singapore [2013] 1 SLR 341 (folld)

Pegang Mining Co Ltd v Choong Sam [1969] 2 MLJ 52 (folld)

Ramli bin Shahdan v Motor Insurers' Bureau of West Malaysia [2006] 2 MLJ 116 (refd)

Randall v Raper (1858) EB & E 84; 120 ER 438 (folld)

Robertson Quay Investment Pte Ltd v Steen Consultants Pte Ltd [2008] 2 SLR(R) 623; [2008] 2 SLR 623 (folld)

State-Owned Company Yugoimport SDPR, The v Westacre Investments Inc [2016] 5 SLR 372 (folld)

Tan Yow Kon v Tan Swat Ping [2006] 3 SLR(R) 881; [2006] 3 SLR 881 (folld)

TKM (Singapore) Pte Ltd v Export Credit Insurance Corp of Singapore Ltd [1992] 2 SLR(R) 858; [1993] 1 SLR 1041 (refd)

TMT Asia Ltd v BHP Billiton Marketing AG (Singapore Branch) [2015] 2 SLR 540 (refd)

Tohtonku Sdn Bhd v Superace (M) Sdn Bhd [1989] 2 MLJ 298 (refd)

Tomlinson v Gill (1756) Amb 330; 27 ER 221 (refd)

Total Liban SA v Vitol Energy SA [2001] QB 643 (folld)

Vandepitte v Preferred Accident Insurance Corp of New York [1933] AC 70 (folld)

Woodar Investment Development Ltd v Wimpey Construction UK Ltd [1980] 1 WLR 277 (refd)

Legislation referred to

Contracts (Rights of Third Parties) Act (Cap 53B, 2002 Rev Ed) s 1

Motor Vehicles (Third-Party Risks and Compensation) (Exemption)

Notification (S 526/1998) s 3 Motor Vehicles (Third-Party Risks and Compensation) Act (Cap 189, 2000 Rev Ed)

Rules of Court (Cap 322, R 5, 2014 Rev Ed) O 14 r 12, O 14 r 12(1), O 14 r 12(3), O 18 r 19

Road Traffic Act 1930 (c 43) (UK)

Rules of the Supreme Court 1965 (SI 1965 No 1776) (UK) O 45 r 9

Contract Remedies — Damages — Whether Motor Insurers' Bureau entitled to substantial damages as trustee of contractual promisee for second plaintiff — Whether Motor Insurers' Bureau entitled to substantial damages on broad ground in Family Food Court v Seah Boon Lock[2008] 4 SLR(R) 272

Insurance — Motor vehicle insurance — Insurer concerned — ontract between Motor Insurers' Bureau and defendant requiring defendant to satisfy judgment in second plaintiff's favour — Whether second plaintiff had locus standi to sue defendant for satisfaction of judgment — Whether Motor Insurers' Bureau held contractual promise on implied trust for second plaintiff —

Insurance — Motor vehicle insurance — Motor Insurers' Bureau — Second plaintiff injured in traffic accident — Final judgment obtained by second plaintiff against third party — Judgment not satisfied — Suit commenced by second laintiff and Motor Insurers' Bureau against insurer of third party's motorcycle — Whether defendant liable to satisfy judgment or only to indemnify Motor Insurers' Bureau for so doing —

Facts

The third party (“Liew”) was riding his Malaysian-registered motorcycle in Singapore with his wife, the second plaintiff (“Koo”), riding pillion, when they met with a road traffic accident. As a result of the accident, Koo suffered serious injuries. At the time of the accident, Liew's motorcycle was insured under a policy issued by the defendant (“AM Gen”) which did not cover passenger liability. Koo commenced proceedings in Singapore against Liew for her injuries and obtained final judgment against him in the sum of S$788,057.73 plus interest, costs and disbursements (“the Judgment Debt”).

Liew did not satisfy the Judgment Debt. The Motor Insurers' Bureau of Singapore (“the MIB”) and Koo commenced proceedings against AM Gen to compel it to satisfy the Judgment Debt. The plaintiffs relied on two agreements. The first, entered into between the MIB and all motor insurance businesses operating in Singapore, specified the circumstances under which an insurance company was liable to compensate victims of a traffic accident (“the Domestic Agreement”). Clause 3(1) of the Domestic Agreement stated that, if judgment was obtained in Singapore against any person in respect of liability required to be insured by the Motor Vehicles (Third Party Risks and Compensation) Act (Cap 189, 2000 Rev Ed), the “Insurer Concerned” would satisfy the judgment creditor if and to the extent that the judgment had not been satisfied by the judgment debtor within a certain time. By way of a separate agreement between the MIB and AM Gen, the latter agreed to be bound by the obligations in the Domestic Agreement in the same way as a Singaporean insurer (“the Special Agreement”). The plaintiffs therefore contended that AM Gen, being the “Insurer Concerned”, was required pursuant to cl 3(1) of the Domestic Agreement read with the Special Agreement to satisfy the Judgment Debt as it had not been satisfied by Liew within the given time. AM Gen, on the other hand, contended that the MIB was obliged to first satisfy the Judgment Debt pursuant to cl 3 of an agreement between the MIB and the Minister for Finance of the Republic of Singapore (“the Principal Agreement”); only thereafter did the MIB's right to an indemnity or reimbursement from AM Gen arise under the Domestic Agreement and Special Agreement.

The plaintiffs subsequently filed Summons No 4880 of 2016 under O 14 r 12 of the Rules of Court (Cap 322, R 5, 2014 Rev Ed) (“the Rules of Court”) for (a) a determination of whether AM Gen was the “Insurer Concerned” as defined in cl 1 of the Domestic Agreement, and if so, whether AM Gen was obliged to satisfy the Judgment Debt; (b) final judgment to be entered in favour of either plaintiff in the sum of the Judgment Debt; (c) in the alternative, interlocutory judgment to be entered in the MIB's favour for damages to be assessed; and (d) in the further alternative, an order of specific performance of the Special Agreement read with the Domestic Agreement, requiring AM Gen to pay the Judgment Debt to Koo within 14 days. AM Gen argued that the O 14 r 12 process was inappropriate in this case.

The principal legal issues in the suit arose from the fact that the MIB (not Koo) was party to the Principal, Domestic and Special Agreements, whereas Koo (not the MIB) stood to benefit from the performance of cl 3(1) of the Domestic Agreement. AM Gen therefore contended that Koo lacked locus standi to sue on the Domestic and Special Agreements; and that though the MIB could sue, it had suffered no actionable loss and could not obtain substantial damages. The plaintiffs countered that Koo had locus standi to sue AM Gen in her capacity as beneficiary of an implied trust arising out of the Domestic Agreement, by which the MIB held the contractual promises in the Domestic Agreement on trust for traffic accident victims such as Koo. The plaintiffs further submitted that the MIB was entitled to substantial damages in law on the broad ground set out in Family Food Court v Seah Boon Lock[2008] 4 SLR(R) 272 (“the Broad Ground”), and in equity as Koo's trustee on the basis of the principle in Lloyd's v HarperELR(1880) 16 Ch D 290 (“Lloyd's”).

Held, allowing the claim:

(1) AM Gen did not dispute that it was the “Insurer Concerned” for the purposes of the Domestic Agreement. The real issues between the parties were therefore whether the plaintiffs had locus standi to sue in Suit 647; whether AM Gen was contractually obliged to satisfy the Judgment Debt; and if so, what relief the plaintiffs might obtain: at [34] and [38].

(2) It was appropriate to determine these issues under O 14 r 12 of the Rules of Court, as this would dispose of the suit in large part if not in whole. The facts were within a narrow compass and undisputed, and the questions of law were not specially related to the facts or dependent on the outcome of any factual dispute. A trial judge would not be in a better position to determine the questions...

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