Msig Insurance (Malaysia) Sdn Bhd v 1. Rahmat Bin Mohd Dae (WA-24NCC-59–01/2018)

1.

MUHAMAD AKMAL BIN WAHID DEFENDANTS JUDGMENT Introduction [1] The plaintiff sought to obtain a declaration that the insurance policy that it had issued to the first defendant for the period from 1 October 2016 to 30 September 2017 was void and unenforceable. It also sought to declare that it will not be liable for any judgment entered against the first defendant in relation to an accident of a Mitsubishi Pajero jeep with the registration number WHE 9168 (‘the jeep’) on the 18 October 2

The application was made pursuant to s. 96(3) Road Transport Act 1987 (‘RTA 1987’). [2] Only the second defendant had participated and contested the plaintiff’s claim. The originating summons had been served on the first defendant personally on the 16 March 2018 (see the affidavit of service by Akmaar Ghalib Bhoy affirmed on the 27 March 2018). Brief facts [3] A claim was made against the first defendant for an accident that allegedly occurred on the 18 October 2016. The second defendant, who rode a motorcycle, claimed to have been hit by the jeep driven by a Syarul bin Ahmad Dauli (‘Syarul’). The second defendant subsequently filed a suit at the Seremban Sessions Court. [4] Syarul lodged a police report some twenty-two days after the accident. Syarul however, lodged another police report the day after to withdraw his earlier report. In the first police report, Syarul claimed to have driven the jeep. He claimed to have been hit from the back by the second defendant who rode a motorcycle, when he had abruptly braked. In the second report, Syarul retracted his first police report by stating that he had no knowledge of the accident, and that he was not involved. 3 [5] The loss adjuster appointed by the plaintiff had interviewed the first defendant pertaining to the claim. The first defendant claimed that he had never bought the jeep, and alleged that someone had used his identity to purchase it. The first defendant proceeded to lodge three police reports on the 12 April 2017 and made a statutory declaration on the 17 April

He had in the police reports and statutory declaration, asserted that he had never bought nor owned the jeep, and had no knowledge of the accident involving the jeep. [6] The plaintiff’s loss adjuster then met the jeep’s seller, which was a company called Ace Fleet Sdn Bhd. The company claimed that the first defendant had bought the jeep from them for RM75,000.00. An order form dated 26 September 2001 and a delivery form dated 29 September 2001 were produced as evidence. It was also claimed that the first defendant had purchased an insurance policy from them. [7] All these assertions were contained in the plaintiff’s affidavit in support of the originating summons. The second defendant’s response [8] The second defendant in denying the plaintiff’s assertions, had also raised the possibility that the first defendant could have made the police reports and statutory declaration under duress. 4 [9] Learned counsel for the second defendant cited s. 102 and 103 Evidence Act 1950 and submitted that the burden of proof lies on the plaintiff. It was also submitted that there is a need for the plaintiff to call the first defendant as a witness at the Seremban Sessions Court, so that he could testify under oath. This would also allow the first defendant to be cross-examined. Findings [10] The facts of this case bear a striking similarity with the facts in Allianz General Insurance Company (M) Bhd v Vijindran Kalaichelvan & ors [2017] 1 LNS 2148. In that case, the insurance company had also applied to declare the insurance coverage for the motorcycle that was allegedly insured under the name of the second defendant void. The third and fourth defendants in that suit claimed to have suffered injuries due to the negligence of the first defendant riding the second defendant’s motorcycle. [11] The first defendant had lodged a police report that seemed to confirm that the accident did occur. The first defendant however subsequently changed his version after being interviewed by the loss adjusters. He had through a statutory declaration denied that the accident had ever occurred. The first defendant had also averred that he was forced by the lawyers for the third and fourth defendants to make the 5 police report falsely to enable a false claim to be made against the insurance company. [12] The insurance company in seeking for a declaration under s. 96(3) RTA 1987, contended that the second defendant had breached the duty of utmost good faith, in allowing the first defendant to be in cohorts with the third and fourth defendants to make a false claim. [13] Nazlan J. in allowing the insurance company’s application, held that the issue is purely between the insurance company and the insured, namely the second defendant. His lordship stated that it is not for the third and fourth defendant to question to insurance policy, as they were not privy to the insurance contract. [14] In elucidating this point, his lordship referred to the cases of Sun Life Malaysia Takaful Berhad (dahulunya dikenali sebaqai CIMB Aviva Takaful Berhad v Noorulsmiah binti Sulong @ Mohd Nasir & 7 ors [2015] 3 AMR 8703 and Pacific & Orient Insurance Co Bhd v Vigneswaran a/l Rajarethinam & 2 ors [2013] 1 AMCR 736, and quoted the following passage from the latter case:- “A contract of insurance is between an insured and his insurer. Now the insured is telling the insurer categorically that I’m NOT involved in this accident. It is a scam? Why the insurers should not act on his statement and avoid the policy? 6 The second and third defendant are not privy to the contract between the plaintiff and the first defendant and therefore cannot dictate whether the insurers should indemnify the first defendant or not. This is a simple law of contract.” [15] I see no reason to depart. The plaintiff’s application is based on the contention that the first defendant had never bought nor owned the jeep. Although the plaintiff had issued a coverage for the jeep, it was issued under the name of the first defendant. There would be no valid coverage if it is proven that the first defendant had never owned the jeep. [16] Now the averments by the plaintiff were never challenged by the first defendant. It remains unrebutted. It is not for the second defendant to challenge the averment. If the second defendant doubts the veracity of the first defendant’s version, it is for him to mount that challenge at the Sessions Court where his claim was filed. [17] The second defendant has no standing to question the insurance contract between the plaintiff and the first defendant. He has no nexus with the plaintiff. It is purely a contractual issue between the plaintiff and the first defendant. The second defendant’s grievance against the first defendant is an issue of negligence, which as I have stated earlier, should be ventilated at the Sessions Court. 7 Conclusion [18] I therefore grant an order in terms of the reliefs sought by the plaintiff in the originating summons. I however make no order as to costs. Dated: 4 May 2018. -sgd- (Mohamed Zaini Mazlan) Judge Kuala Lumpur High Court (Commercial Division) Counsel for the plaintiff Suresh Andrew [Messrs Gobi & Associates] Counsel for the defendant Mendeep Singh [Messrs Shan & Su]