Teo Rong Zhi Saimonn v Public Prosecutor

• Jurisdiction: Singapore
• Judge: Tay Yong Kwang J
• Judgment Date: 23 September 2013
• Neutral Citation: [2013] SGHC 185
• Court: High Court (Singapore)
• Docket Number: Magistrate’s Appeal No 264 of 2012
• Year: 2013
• Published date: 02 October 2013
• Hearing Date: 09 September 2013
• Plaintiff Counsel: Peter Ong Lip Cheng (Peter Ong & Raymond Tan)
• Defendant Counsel: April Phang (Attorney-General's Chambers),Margaret Joan Ling (Allen & Gledhill LLP) as amicus curiae
• Subject Matter: Road Traffic,Third party liability
• Citation: [2013] SGHC 185

Tay Yong Kwang J:

The appellant claimed trial and was convicted on 19 October 2012 by the District Judge (“the DJ”) on the following charge:

You … are charged that you, between the period 25.3.2011 to 20.5.2011 in Singapore, being the person in-charge of motor car No. SGE 6666 E (now registered as SKB 7012 D), did permit one Lee Han Keat to use the said motor car when there was not in force in relation to the user of the said vehicle such a policy of insurance in respect of third party risks as complies with the requirement of the Motor Vehicles (Third Party Risks and Compensation) Act, Chapter 189 and you have thereby committed an offence under Section 3(1) and punishable under Section 3(2) of the said Act, Chapter 189.

The DJ sentenced the appellant to a $600 fine (in default three days’ imprisonment) and 12 months’ disqualification from the date of conviction from holding or obtaining a driving licence for all classes of vehicles. The fine was paid. The appellant appealed against conviction but not against the sentence imposed.

During the appeal, in the course of arguments, I amended the charge to “when there was not in force in relation to the use of the said vehicle …” (instead of “user”). This was to accord with the statutory language. There were no objections to this amendment.

I dismissed the appeal against conviction. I now set out the reasons for my decision.

Facts

In early 2011, the appellant purchased vehicle registration number SGE 6666 E (“the Registration Number”). The appellant then purchased a Toyota Corona (“the Vehicle”) for about $3,000 and registered it in the name of his wife on 5 March 2011 in order to benefit from lower insurance premiums. The appellant had sole control of the Vehicle. The appellant purchased the Vehicle for the sole purpose of retaining the Registration Number with a view to the eventual sale of the Registration Number. At the time of purchase, the Vehicle’s certificate of entitlement was only valid for about another six months.

The appellant purchased an insurance policy (“the Policy”) for the Vehicle from Liberty Insurance Pte Ltd (“Liberty Insurance”). The policy came into force on 5 March 2011 and was to expire on 4 March 2012. The material terms of the Certificate of Insurance are as follows:

6. Persons or Classes of Persons entitled to drive:

A) The Policyholder.

B) Any other person who is driving on the Policyholder’s order or with his permission.

…

7. Limitations as to use:

Use only for social, domestic and pleasure purposes and for the Policyholder’s business.

8. The Policy does not cover:

A) Use for hire or reward.

B) Use for racing, pace-marking, reliability trials or speed-testing.

…

[emphasis added; footnotes in original omitted]

Although the appellant initially left the Vehicle in a car park without any intention to rent it to others, he subsequently decided to rent it out to recoup some of the costs of purchase. The appellant therefore placed an advertisement on the Internet.

The advertisement was seen by one Lee Han Keat (“Lee”). Pursuant to a car rental agreement dated 24 March 2011 (“the Rental Agreement”), Lee rented the Vehicle from 25 March to 25 August 2011 at a fee of $800 per month with an initial deposit of $200. The Rental Agreement was signed by the appellant’s wife and Lee. However, the Rental Agreement was drafted by the appellant who met Lee in order to obtain his signature. Lee did not meet or speak to the appellant’s wife at any time.

Lee used the Vehicle from 25 March to 20 May 2011 (“the material time”). On 21 May 2011, Lee was imprisoned. When Lee failed to pay the rental fee for May 2011, the appellant made enquiries and discovered that Lee had been detained by the Central Narcotics Bureau. The appellant also discovered that several parking summonses had been issued against the Vehicle. The appellant therefore lodged a police report dated 1 June 2011 (“the Police Report”), which stated that he would not be responsible for the Vehicle during the period when it was rented to Lee.

On 14 July 2011, Liberty Insurance cancelled the Policy. Liberty Insurance did not have any record of the Certificate of Insurance having been surrendered to it. As a result of the above events, investigations were carried out. These led to criminal proceedings being initiated against the appellant, culminating in his conviction on the Charge on 19 October 2012.

The decision below

The DJ had to consider two issues. The first issue was whether the appellant could be said to have permitted Lee to use the Vehicle when he was not the registered owner. The second was whether the Vehicle was insured when it was used by Lee at the material time.

With regard to the first issue, the DJ held that the offence under s 3 of the Motor Vehicles (Third Party Risks and Compensation) Act (Cap 189, 2000 Rev Ed) (“the Act”) would be made out as long as it was established that the accused was in charge of the Vehicle and was in a position to forbid the other person from using the Vehicle. It was undisputed that the appellant was in charge of the Vehicle at the material time. The appellant did not appeal against this aspect of the DJ’s decision. In any case, I agree with the reasoning of the DJ on this issue.

On the second issue, the DJ held that the use of Vehicle by Lee at the material time was not covered by the terms stated in the certificate of insurance. The policy explicitly stated that it would not cover the use of the Vehicle for hire or reward and it was not in dispute that the Vehicle had been rented to Lee. It was also immaterial that the appellant was in possession of the original Certificate of Insurance or that there was no evidence that the Policy had been repudiated.

The issue raised on appeal

Accordingly the only issue that arose for my consideration was whether an insurance policy which complied with s 3 of the Act (which mandates insurance in respect of third-party risks) was in force in relation to the use of the Vehicle by Lee at the material time.

The respective arguments

The appellant argued that the Policy complied with s 3 of the Act. The appellant relied on two intermediate propositions to establish this argument: firstly, insurers had the duty to satisfy judgments against insured persons under s 9 of the Act; secondly, Liberty Insurance had not repudiated the Policy in accordance with the Act.

The respondent took the position that the Policy did not comply with s 3 of the Act. The Policy did not cover the use of the Vehicle by Lee; therefore, it was irrelevant that the Policy was in force when Lee was using the Vehicle at the material time. Additionally, it was also irrelevant that the Policy had not been repudiated in accordance with s 9 of the Act.

An amicus curiae, Ms Margaret Joan Ling, was appointed pursuant to the Young Amicus Curiae scheme. The amicus curiae made various submissions. First, s 3(1) of the Act had a dual purpose of both compensation for third parties and deterrence. Secondly, a certificate of insurance is only evidence of, and is not equivalent to, a policy of insurance. Thirdly, ss 8 and 9 of the Act would not result in an insurer being liable to a third party in respect of a liability not covered by the policy (except for certain enumerated categories as set out in s 8(1) of the Act).

The law

S 3 of the Act provides:

Users of motor vehicles to be insured against third-party risks

3. —(1) Subject to the provisions of this Act, it shall not be lawful for any person to use or to cause or permit any other person to use —

(a) a motor vehicle in Singapore; or

(b...