Yong Sheng Goldsmith Pte Ltd v Liberty Insurance Pte Ltd

• Jurisdiction: Singapore
• Judge: Fong Mian Yi Seraphina AR
• Judgment Date: 24 June 2011
• Neutral Citation: [2011] SGHC 156
• Court: High Court (Singapore)
• Hearing Date: 10 June 2011
• Docket Number: Suit No 946 of 2010 (Summons No 1423 of 2011)
• Plaintiff Counsel: Charles Phua Cheng Sye/ Steven Cheong (Tan Kok Quan Partnership)
• Defendant Counsel: N K Rajarh (M Rama Law Corporation)
• Subject Matter: Civil Procedure,Insurance
• Published date: 29 June 2011

Fong Mian Yi Seraphina AR: Introduction

This is an application for summary judgment by the plaintiff under O 14 of the Rules of Court (Cap 322, R 5, 2006 Rev Ed) (“the Rules of Court”). The plaintiff, Yong Sheng Goldsmith Pte Ltd, entered into a contract of insurance with the defendant, Liberty Insurance Pte Ltd. Pursuant to the insurance policy, the defendant was liable to indemnify the plaintiff for loss suffered as a result of a hold up or armed robbery up to the policy limit of S$3 million. Subsequently, an armed robbery occurred at the plaintiff’s insured premises. However the defendant refused to indemnify the plaintiff and claimed that the insurance contract was void ab initio due to material non-disclosure on the part of the plaintiff.

The facts

The plaintiff is, at all material times, a company incorporated in Singapore carrying on the business of the retail of gold/diamond jewellery, precious stone and the manufacture of jewellery. Around 2003, the plaintiff entered into a contract of insurance with the defendant, who is at all material times, an insurance company incorporated in Singapore. The plaintiff renewed this jewellers’ block insurance policy yearly. The policy that concerns us is the contract renewed in 2009, to cover the period from 1 December 2009 to 30 November 2009 (“the Policy”), whereby the defendant agreed to insure, inter alia, stock and merchandise used in the conduct of the plaintiff’s business, situated at Block 210 New Upper Changi Road, #01-727 Singapore (“the Insured Premises”) in consideration of the payment of the premium of S$14,996.49 by the plaintiff. The plaintiff paid the premium and the Policy was issued to the plaintiff to cover the stock and merchandise at the Insured Premises for the period from 1 December 2009 to 30 November 2010. The Policy provided that the defendant was liable to indemnify the plaintiff for loss suffered as a result of a hold up or armed robbery up to the policy limit of S$3 million.

On 23 April 2010, an armed robbery occurred at the Insured Premises. The defendant’s loss adjustors assessed the market value of the gold seized by the armed robbers at S$857,441.25. As the armed robbery at the Insured Premises was an insured event under the policy, the plaintiff notified the said loss to one Johnny Tan (“Johnny”), whom the plaintiff asserts was at all material times the defendant’s agent dealing with the plaintiff’s Policy.

However, on 4 November 2010, the defendant informed the plaintiff by way of letter that the Policy was repudiated on the basis of material non-disclosure by the plaintiff. The defendant alleged that the plaintiff failed to disclose the fact that the Insured Premises was the subject of loan shark harassment prior to the commencement of the Policy on 23 October 2009 and 26 October 2009. The Insured Premises was also subject to loan shark harassment on 28 November 2009, 24 January 2010 and 27 March 2010. Thereafter the defendant returned the policy premium of S$14,996.49 by way of cheque to the plaintiff.

The plaintiff’s claim

The plaintiff contends that the defendant’s allegations are baseless as they had notified Johnny of the loan shark harassment on 23 October 2009. The plaintiff relies on telephone records exhibited in the plaintiff’s director Lim Chiow Kiat’s (“Lim”) affidavit, which revealed that Lim had made telephone calls to Johnny on the relevant dates.

In addition, the plaintiff claims that they have been informed by the CID officer investigating the armed robbery that the loan shark activities were unrelated to the armed robbery and had also invited the defendant to confirm the same with the CID officer via telephone.

As such, the plaintiff submits that they have disclosed the loan shark activities to the defendant via Johnny, the defendant’s agent and the defendant therefore had no basis to repudiate the Policy. The plaintiff thus seeks summary judgment against the defendant for the sum of S$857,441.25.

The defendant’s claim

In its defence, the defendant claims that the first time it had acquired any knowledge of the loan shark activities was when the defendant’s loss adjuster investigated the robbery and was informed by Lim that the Insured Premises had been the target of loan shark attacks on four occasions in October 2009.

While the defendant admits that Johnny was a registered agent with the defendant, the defendant denies that he was an agent of the defendant in respect of the plaintiff’s Policy. The defendant submits that the agency which acted in respect of the Policy was in fact, one Aon Insurance Agencies Pte Ltd (“Aon”), and that the defendant had no knowledge that Johnny was involved in the Policy. As such, Johnny’s knowledge of the loan shark activities cannot be attributed to the defendant and no disclosure by the plaintiff can be deemed to have occurred.

The present application

The plaintiff applied for summary judgment under O 14 r 3 of the Rules of Court. The relevant provision of the Rules of Court provides:

Judgment for plaintiff

3 – (1) Unless on the hearing of an application under Rule 1 either the Court dismisses the application or the defendant satisfies the Court with respect to the claim, or part of a claim, to which the application relates that there is an issue or question in dispute which ought to be tried or that there ought for some other reason to be trial of that claim or part, the Court may give such judgment for the plaintiff against that defendant on that claim or part as may be just having regard to the nature of the remedy or relief claimed.

The issues

The issues that need to be dealt with in the present matter are: Was Johnny an agent of the defendant; If so, whether Johnny’s knowledge could be imputed to the defendant; and Was there in any event, material non-disclosure on the part of the plaintiffs?

Was Johnny an agent of the defendant?

The plaintiff claims that the defendant’s allegation that there was material non-disclosure on the plaintiff’s part is completely baseless as they had notified Johnny, who was the defendant’s agent and therefore knowledge on the part of the agent would bind his principal. The plaintiff pointed to a copy of Johnny’s name card exhibited at Lim’s affidavit, which included the following: (i) The defendant’s name “Liberty Insurance – Member of Liberty Mutual Group”; (ii) The name “Tan Johnny” with the title “Insurance Agent” below the name; (iii) Johnny’s contact details; and (iv) The registered contact details of the defendant.

In addition, Johnny had filed an affidavit stating that he was indeed a registered agent of the defendant since 2003 or earlier and that he was the defendant’s agent in respect of...