Tan Ryan v Lua Ming Feng Alvin and another

Colin Liew AR:

[1] This was an application by the plaintiff for an interim payment of $80,000 from the first defendant pursuant to O 29 r 10 of the Rules of Court (Cap 322, R 5, 2006 Rev Ed) (“the Rules of Court”). I granted the plaintiff’s application, and, given the novelty of some of the issues involved, I now provide the grounds of my decision.

[2] Under O 29 r 11(1) of the Rules of Court, the court has the power to make an order for interim payment, but this power is curtailed in the circumstances provided for in O 29 r 11(2). For convenience, the relevant provisions of O 29 r 11 are as follows:

[3] It was not disputed that O 29 r 11(1)(b) of the Rules of Court was satisfied, since the plaintiff had obtained interlocutory judgment against the first defendant (see [9] below). Instead, the dispute was essentially as to O 29 r 11(2), ie, whether the first defendant was “a person who is insured in respect of the plaintiff’s claim” or “a person whose means and resources are such as to enable him to make the interim payment”. Due to the somewhat awkward phrasing of O 29 r 11(2), I should clarify that in these grounds, when I refer to either limb of O 29 r 11(2) “applying” or being “satisfied”, I mean that an interim payment cannot be ordered, ie, the defendant is not, for instance, a person who is insured in respect of the plaintiff’s claim.

[4] On 15 October 2008, at about 3.03am, while riding his motorcycle along the Pan Island Expressway, the plaintiff was involved in a serious road accident when a motor car (“SGT 6356X”) driven by the first defendant collided into him. As a result of the accident, the plaintiff suffered serious injuries which necessitated the amputation of a portion of his left leg.

[5] The first defendant was not in fact the owner of SGT 6356X. That person was his sister, Lua Bee Leng Sally (“Sally Lua”), who had been issued a comprehensive motor insurance policy (“the Policy”) by M/s Allianz Insurance Company of Singapore Pte Ltd ( “Allianz” or the “second defendant”, depending on the capacity in which it acted). As required by the Motor Vehicles (Third-Party Risks and Compensation) Act (Cap 189, 2000 Rev Ed) (“the Act”), the Policy provided insurance coverage to Sally Lua and other authorised drivers of SGT 6356X in respect of, inter alia, third party risks. It should be said that the first defendant was driving SGT 6356X with the authority of Sally Lua, and would, prima facie at least, therefore have been insured under the Policy.

[6] Subsequently, in respect of the accident, the first defendant was charged with, and on 13 August 2010 convicted of, inter alia, an offence of driving while under the influence of drink under s 67(1)(b) of the Road Traffic Act (Cap 276, 2004 Rev Ed).

[7] The plaintiff then commenced the present suit against the first defendant, who, as is common in these types of cases, was initially represented by M/s Global Law Alliance LLC (“Global Law”), the solicitors for Allianz. On 25 June 2010, however, Global Law wrote to the first defendant, stating that Allianz repudiated liability under the Policy to indemnify him against the plaintiff’s claim, on account of the fact that the first defendant had been driving while under the influence of alcohol. Allianz’s purported repudiation of liability under the Policy was pursuant to cl 5.3, which provided:

[8] Once Allianz purported to repudiate liability under the Policy, Global Law was no longer in a position to act for the first defendant, and, accordingly, on 26 October 2010 the first defendant engaged M/s KhattarWong to represent him. Immediately thereafter, on 27 October 2010, Allianz applied to be joined as the second defendant, represented by Global Law, which application was granted on 24 November 2010. However, at all points in these proceedings, no direct claim was being made by the plaintiff against the second defendant.

[10] That was the background against which the parties appeared before me on 11 May 2011 in respect of the plaintiff’s application for interim payment. It was quite clear that O 29 r 11(1)(b) of the Rules of Court was satisfied (see [3] above), and so the remaining question was whether O 29 r 11(2) precluded me from entertaining the plaintiff’s application.

[11] Counsel for the second defendant, Mr Niru Pillai, was unfortunately scheduled to attend another hearing, and therefore was only able to briefly set out the second defendant’s position. This was to the effect that the second defendant did not consider itself to be in a position to consent or object to the application, because it had repudiated liability vis-à-vis the first defendant, and its statutory obligation under s 9 of the Act to satisfy a judgment obtained by the plaintiff was only triggered when the plaintiff obtained a final judgment. Mr Pillai thereafter left it to the first defendant to deal with the plaintiff’s application.

[12] Counsel for the plaintiff, Mr N Srinivasan, clarified that interim payment was only being sought against the first defendant and not the second defendant. Mr Srinivasan’s submission in support of the application was essentially that, notwithstanding that the second defendant had purported to repudiate its liability under the Policy, nonetheless the first defendant was still “a person who is insured in respect of the plaintiff’s claim”, and therefore O 29 r 11(2)(a) of the Rules of Court did not apply. For this proposition Mr Srinivasan relied on Du Zhao Di (suing as Committee of the Person and Estate of Jiang Hui Ping) v Lee Chee Yian (Mayban General Assurance, intervener) [2007] SGHC 88 (“Du Zhao Di”), which he submitted was on all fours with the present case, save that in Du Zhao Di interlocutory judgment had not been obtained.

[13] Counsel for the first defendant, Mr Patrick Yeo, objected to the plaintiff’s application. He allied himself with the second defendant’s position and argued that, since the second defendant had repudiated liability under the Policy, and given that the second defendant was not obliged under the Act to satisfy interlocutory judgments, the second defendant was therefore not obliged to meet any order of interim payment. According to the English Court of Appeal in O’Driscoll v Sleigh and another (unreported, 20 November 1984) (“O’Driscoll”), cited with approval in Du Zhao Di, the test under O 29 r 11(2)(a) was whether the insurer would be obliged to meet any interim award. Since the second defendant was not so obliged, Mr Yeo submitted, the first defendant was not “a person who is insured in respect of the plaintiff’s claim” and therefore O 29 r 11(2)(a) applied, making it impermissible for me to make an order for interim payment.

[14] There was also some argument as to O 29 r 11(2)(b), ie, whether the first defendant was “a person whose means and resources are such as to enable him to make the interim payment”. Mr Srinivasan argued that since the first defendant had been able to retain KhattarWong throughout these proceedings (as well as proceedings in the Subordinate Courts in respect of his criminal charges), O 29 r 11(2)(b) did not apply, while Mr Yeo’s response was that no affidavit evidence had been produced by the plaintiff as to the first defendant’s means and resources.

[15] As I required some time to consider parties’ arguments, as well as the applicability of Du Zhao Di, I reserved my judgment.

[16] After considering the matter, however, I was concerned that certain points had not been fully addressed during the hearing, and I therefore invited parties to clarify the following:

[17] Parties appeared before me again on 13 June 2011, and, after hearing arguments from counsel for all parties on the above points, I granted the plaintiff’s application.

[18] The issues which arose for my consideration, therefore, were as follows:

(a) Whether, notwithstanding that the second defendant had purported to repudiate its liability under the Policy, the first defendant was nonetheless “a person who is insured in respect of the plaintiff’s claims” within the meaning of O 29 r 11(2)(a) of the Rules of Court; and

(b) Who bore the burden of proving whether the first defendant was “a person whose means and resources are such as to enable him to make the interim payment” within the meaning of O 29 r 11(2)(b), and whether that burden had been discharged;

(c) Whether, if neither O 29 r 11(2)(a) nor O 29 r 11(2)(b) was applicable, I ought to exercise my discretion to order interim payment, and if so the amount of interim payment to be granted; and

(d) Whether, if interim payment was ordered, it could be paid to the plaintiff personally, or whether, under s 9 of the Act, it had to be paid to the Public Trustee.

[20] I should say that, unlike the second issue under O 29 r 11(2)(b) of the Rules of Court (see [47] below), no question of burden of proof arose under O 29 r 11(2)(a), because, as Mr Srinivasan rightly pointed out, the parties being agreed on all material facts, the only questions were questions of law, viz, the meaning of the phrase “a person who is insured in respect of the plaintiff’s claim” and whether the agreed facts fell within O 29 r 11(2)(a) as properly construed. Although this question was ostensibly one of construction of O 29 r 11(2)(a), that task was made more difficult due to the fact that the scheme of compulsory third party motor insurance under the Act had to be taken into account, because whether or not the first defendant was “insured in respect of the plaintiff’s claim” depended very much on some of the provisions of the Act.

[21] The Act originally derived from the UK’s Road Traffic Act 1930 (c 43) (UK) (“the RTA 1930”) and its many iterations, the most material for present purposes being the Road Traffic Act 1934 (c 50) (UK) (“the RTA 1934”), Road Traffic Act 1972 (c 20) (UK) (“the RTA 1972”) and Road Traffic Act 1988 (c 52) (UK) (“the RTA 1988”). The Act was introduced to ensure that innocent victims of road accidents (“third parties”) would be adequately protected in the event of fatality or bodily injury. As Tan Lee Meng, Insurance Law in Singapore (Butterworths Asia, 2 ed, 1997) explains at p 573:

[22] Some salient features of the Act should be mentioned. Under s 3 of the Act, all users of motor vehicles must be issued an insurance policy which insures the user and other authorised drivers against third party risks, in particular, liability incurred by the user in respect of the death or bodily injury of any person as a result of the use of the motor vehicle (see s 4(1)(b) of the Act). The insured person must also be issued a certificate of insurance under s 4(9) of the Act. Once those requirements have been complied with, the Act’s object is then to see that any third parties who are the victims of road accidents will generally receive the compensation they are entitled to, and it achieves this by, inter alia, statutorily removing some of the insurer’s freedom to contract out of its liabilities to the insured person. Under ss 7 and 8 of the Act, for instance, the third party’s position has been considerably strengthened by legislative intervention, because where these sections apply, certain attempts by the insurer to restrict or exclude its liability under the insurance policy to indemnify the insured person are rendered ineffective, and the insurer will be contractually obliged to indemnify the insured person under the insurance policy in respect of the third party’s claim against the insured person for damages, which sums the insurer may be able to recover from the insured person (as of right in the case of s 8 of the Act, but only if the insurance policy so provides in the case of s 7). As I will be referring to ss 7 and 8 later in these grounds, it will be useful to set out exactly what they provide:

Finally, s 9 of the Act gives the third party who has obtained judgment against the insured person a statutory right of action against the insurer, allowing the third party to directly enforce his judgment against the insurer, even if the insurer has avoided or cancelled the policy and is not therefore liable to the insured person:

[23] It was apparent, therefore, that simply because the second defendant had purported to repudiate its liability to indemnify the first defendant under the Policy in respect of the plaintiff’s claim, it did not follow that the first defendant was not therefore “insured”: it might have been that, as a matter of law, such repudiation was ineffective due to one of the provisions of the Act, as was held to be the case in Du Zhao Di.

[24] The facts of Du Zhao Di, as Mr Srinivasan noted, were materially similar to those in the present case. The plaintiff and defendant were involved in an accident when the defendant opened the door of his car and the plaintiff, while riding a bicycle, collided into the open door. The plaintiff sued the defendant seeking substantial damages. The defendant was initially represented by lawyers acting for the intervener, Mayban General Assurance Berhad, who had issued a third party motor vehicle insurance policy to the defendant. However, as a result of the defendant’s non-cooperation in the preparation of the defence, the intervener purportedly repudiated liability on the insurance policy. The matter then came before the learned assistant registrar (“AR”) Mr Mohamed Faizal on the plaintiff’s application for an interim payment. One of the grounds on which the intervener opposed the application was that, given that it had repudiated liability to the defendant under the insurance policy, the defendant was not “insured in respect of the plaintiff’s claim” within the meaning of O 29 r 11(2)(a).

[25] The learned AR rejected this argument. He held that the intervener’s repudiation of liability under the insurance policy would not affect the plaintiff for the following reasons:

The learned AR’s reasoning in these passages could be summarised as follows. The intervener’s purported repudiation of its liability under the insurance policy to indemnify the defendant in respect of the plaintiff’s claim was of no effect as far as the plaintiff was concerned, because it fell foul of s 7(1) of the Act (see [22] above). Therefore, by operation of s 7(1), the intervener was still contractually obliged to indemnify the defendant under the insurance policy in respect of the plaintiff’s claim. As a result, the defendant was to be considered “insured in respect of the plaintiff’s claim” under O 29 r 11(2)(a) of the Rules of Court, and an interim payment could be (and was) ordered.

[26] At [35] of Du Zhao Di, the learned AR found support for his approach in the English case of O’Driscoll, where the plaintiff was a passenger in a bus and was injured when the bus braked suddenly, as a result of the first defendant’s motor car losing a wheel and skidding across the road. The first defendant was covered by a policy of motor insurance, which on the face of it covered his potential liability to the plaintiff in respect of the accident. However, as in Du Zhao Di and the present case, his insurers purported to repudiate their liability to him under the policy, on the basis of certain clauses to the effect that the insurers would be relieved of liability if the first defendant’s vehicle was defective or if he failed to give notice of the accident to them within a specified time. The question for the Court of Appeal, therefore, was whether the insurers’ purported repudiation of liability meant that the first defendant was not “a person who is insured in respect of the plaintiff’s claims” within the meaning of Order 29, rule 11(2)(a) of the Rules of the Supreme Court (SI 1965/1776) (“the RSC”) (in pari materia with O 29 r 11(2)(a) of the ROC).

[28] On the facts of O’Driscoll, Griffiths LJ held that the application of Order 29, rule 11(2)(a) of the RSC was not attracted, as a result of s 148 of the RTA 1972, subsection (2) of which was in all material respects identical to s 7 of the Act, while subsection (1) corresponded to s 8 of the Act (see [22] above). It will be recalled that the insurers in O’Driscoll attempted to repudiate liability to the first defendant under the policy pursuant to clauses relating to the condition of the vehicle and notice to be given by the first defendant. Insofar as reliance on the former clause was concerned, that was rendered ineffective by s 148(1)(b) of the RTA 1972 (corresponding to s 8(1)(b) of the Act), while the insurer’s attempt to invoke the latter clause was nullified by s 148(2) of the RTA 1972 (corresponding to s 7(1) of the Act). Consequently, Griffiths LJ concluded that “[s]o the position is that insurers will, by virtue of those two subsections, be treated, so far as the plaintiff is concerned, as insurers with a duty to indemnify the first defendant in respect of her claim”, and therefore the first defendant was “insured in respect of the plaintiff’s claim”, and Order 29, rule 11(2)(a) of the RSC did not apply.

[29] Notwithstanding the fact that both Du Zhao Di and O’Driscoll appeared to be strongly in the plaintiff’s favour, I was of the view that neither authority directly applied on the facts of this case, because both judgments turned on legislative provisions which did not apply here.

[30] Both Du Zhao Di and O’Driscoll relied on s 7 of the Act (or its English equivalent) to hold that the purported repudiations of liability under the respective policies were of no effect (vis-à-vis the plaintiffs). Unfortunately, s 7 of the Act only applies where the contractual clause in question relieves the insurer of liability “in the event of some specified thing being done or omitted to be done after the happening of the event giving rise to a claim under the policy” [emphasis added]. In Du Zhao Di, the “specified thing” was the defendant’s non-cooperation in the preparation of the defence, while in O’Driscoll it was the first defendant’s failure to give sufficient notice. Both of these unquestionably occurred after the happening of the event which gave rise to a claim under the respective policies, viz, the accidents. In this case, however, the “specified thing” was the first defendant’s driving while under the influence of alcohol (see [7] above), which occurred before the accident, and as a result s 7 of the Act could not apply.

[31] Admittedly, it was possible to reach a different conclusion if one was inclined to take a very narrow reading of cl 5.3 of the Policy. On such a reading, whether SGT 6356X was driven by a person with “more than the legal limit of any alcohol in his blood or breath” could only be determined with any certainty when the driver was charged or upon his conviction by a court of law, and if so then in this case that determination only took place after the occurrence of the accident giving rise to the plaintiff’s claim. Such a reading of cl 5.3, however, was highly strained and surely did not reflect the intention of the parties to the Policy, and as such was not an interpretation which I considered as being open to me to take.

[32] The decision in O’Driscoll also rested on the English equivalent of s 8(1)(b) of the Act (see [28] above), but clearly cl 5.3 of the Policy had nothing to do with “the condition of the vehicle”.

[33] Notwithstanding this, however, O’Driscoll showed the way forward, because if cl 5.3 of the Policy fell foul of any of the other limbs of s 8(1) of the Act, the second defendant’s purported repudiation of liability under the Policy would have been of no effect vis-à-vis the plaintiff. The prime candidate in this respect was s 8(1)(a), ie, could cl 5.3 be regarded as a term of the Policy which purported to “restrict the insurance of the person insured… by reference to… (a) the age or physical or mental condition of persons driving the vehicle”? In other words, could driving under the influence of alcohol be said to relate to a “physical or mental condition”?

[34] Robert Merkin, Colinvaux’s Law of Insurance (Sweet & Maxwell, 9 ed, 2010) at para 22-036, says of s 148(2)(a) of the RTA 1988 (in pari materia with s 8(1)(a) of the Act):

Unfortunately, the authorities cited in relation to this last proposition were Louden v British Merchants’ Insurance Co Ltd [1961] 1 Lloyd’s Rep 154 (“Louden”), Criminal Proceedings against Rafael Ruiz Bernáldez, Case C-129/94 [1996] ECR I-289 (“Bernáldez”), a decision of the European Court of Justice, and Storebrand Skadeforsikring AS v Finanger [2000] Lloyd’s Rep IR 462 (“Finanger”), a decision of the European Free Trade Association Court. Louden will be discussed later (see [36] below), while both Bernáldez and Finanger proceeded on the basis of European Union law and were therefore of no assistance to me.

[35] In Robert Merkin and Jeremy Stuart-Smith, The Law of Motor Insurance (Sweet & Maxwell, 2004) at para 5-138, the following passage appears in a discussion of s 148(2)(a) of the RTA 1988:

Tinline v White Cross Insurance Association, Limited [1921] 3 KB 327 (“Tinline”) and James v British General Insurance Company, Limited [1927] 2 KB 311 (“James”), which were cited as authorities for the final sentence in the above quotation, were unhelpful, for they preceded the introduction of compulsory third party motor insurance, and they only decided that, as a matter of public policy, an insured person was not precluded from suing his insurer for an indemnity in respect of liability incurred by him towards a third party who had been killed or injured as a result of the insured person’s criminal conduct, as long as such conduct was negligent rather than intentional (see to similar effect the decision of the Singapore Court of Appeal in The New India Assurance Co Ltd v Woo Ching Fong [1962] MLJ 432). Tinline and James, therefore, were decided solely on the basis that the rule of public policy known as ex turpi causa non oritur actio did not apply, and, because in neither case was there a clause in the insurance policy by which the insurer purported to restrict the scope of the policy or exclude its liability by reference to the insured person’s criminal behaviour, Tinline and James did not need to consider whether the insurers could rely on such a clause.

[36] In Louden (which was the authority cited in The Law of Motor Insurance in relation to the proposition that s 148(2)(a) of the RTA 1988 “clearly extends to conditions which purport to restrict the insurers’ liability where the vehicle is being driven by persons under the influence of… alcohol” (see [35] above)), the court was required to confront just such a question. There the insured person had taken out a comprehensive motor insurance policy, which contained an exclusion clause stating that the insurer would not be liable under the policy to the insured person in respect of bodily injury “sustained whilst under the influence of… intoxicating liquor”. The insured person died as a result of an accident which occurred while he was under the influence of alcohol, and the question was whether the insurer was liable under the policy to the insured person’s estate. Lawton J held (at 158) that, on the evidence, the insured person had been under the influence of intoxicating liquor within the meaning of the exclusion clause (on which see [41] below), and gave judgment for the insurer. However, Louden was not directly relevant because, there being no claim by a third party, there was no consideration of the English equivalent of s 8(1)(a) of the Act.

[37] Similarly, in Marcel Beller Ltd v Hayden [1978] 1 Lloyd’s Rep 472 (“Marcell Beller”), a life assurance policy excluded liability for “death… directly or indirectly resulting from… the insured person’s own criminal act”, and the insured person had died in a road accident caused by his driving under the influence of drink contrary to s 5 of the RTA 1972. The court held that the insurer was entitled to rely on the exclusion clause and deny liability to the insured person. Again, however, Marcell Beller was not quite on point because no question of compulsory third party motor insurance was involved.

[38] The above cases therefore fell into two categories. There were cases (James) which held that, at common law, an insurer could not exclude liability (under the doctrine of ex turpi causa) to indemnify the insured person against a third party’s claim by reference to the insured person’s drink driving, but where the policy in question did not contain an exclusion clause. There were also cases (Louden and Marcel Beller) which held that, at common law, an insurer could exclude liability to the insured person by reference to an exclusion clause relating to his being under the influence of alcohol or his criminal behaviour, but which only concerned the insured person’s own claim, and not a claim by him for an indemnity in respect of damages to be paid to a third party victim.

[39] Consequently, somewhat surprisingly, it appeared that the question of whether a clause in an insurance policy, such as cl 5.3 of the Policy, which excluded the insurer’s liability to indemnify the insured person against a third party’s claim where the insured person had been driving under the influence of alcohol fell foul of s 8(1)(a) of the Act was untouched by authority, and it was open to me to consider the matter from first principles.

[40] It seemed to me that there was every reason to construe s 8(1)(a) of the Act as nullifying cl 5.3 of the Policy.

[41] First, on a literal interpretation, I could not see how a clause in an insurance policy which referred to the driver of a vehicle having “more than the legal limit of any alcohol in his blood or breath” did not relate to the “physical or mental condition” of the person driving the vehicle. A contamination of a person’s bloodstream by a foreign substance (such as alcohol) seemed to me to be eminently a matter of that person’s “physical… condition”. The manner in which the exemption clause in Louden had been construed was also instructive in this regard. Lawton J, in interpreting the words “under the influence of intoxicating liquor”, applied a construction which had long been settled in England since the case of Mair v Railway Passengers Assurance Company, Ltd (1877) 37 LT 356, viz, that those words connoted the disturbance of “the balance of a man’s mind” or “the quiet, calm, intelligent exercise of the faculties” (Louden at 157). That appeared to me to indicate that exclusion clauses in insurance policies which referred to driving under the influence of alcohol (or variants thereof) were to be understood as relating to the “mental condition” of the driver.

[42] Second, a purposive interpretation (as required by s 9A of the Interpretation Act (Cap 1, 2002 Rev Ed)) led to the same conclusion. Section 8 of the Act had its origins in s 10 of the RTA 1934 (see Colinvaux’s Law of Insurance at para 22-036 at fn 309), which was enacted to ensure that the system of compulsory third party motor insurance established by the RTA 1930 was not circumvented and undermined by motor insurers contracting out of liability by imposing terms and conditions of their choosing (see Zurich General Accident and Liability Insurance Company, Limited v Morrison and others [1942] 2 KB 53 at 61 to 62 (per Goddard LJ)). Section 10 of the RTA 1934 (and now s 8 of the Act) was to be seen, therefore, as preventing motor insurers from excluding liability for common risks, in keeping with the avowed purpose of the Act of ensuring compensation to third party victims of road accidents (see [21] above). Viewed in this light, it was entirely understandable for the UK Parliament to have provided that insurers could not escape liability by stipulating that the insurance policy did not cover liabilities arising, for example, from drivers being underage (now embodied in s 8(1)(a) of the Act), or in poor health (s 8(1)(a)), or from vehicles that were poorly maintained (s 8(1)(b)) or overloaded (s 8(1)(c) and (d)). That these occurrences were frequent dangers in 1934 could be seen from the fact that most if not all of them were prohibited under the RTA 1930 (see for instance ss 3, 5, 9, 25 and 30 of the RTA 1930), and I considered it reasonable to regard driving while under the influence of drink (proscribed by s 15 of the RTA 1930) as a common risk that insurers were to be prevented from deploying as a basis on which to escape liability under the insurance policy.

[43] In addition, I did not regard this construction of s 8(1)(a) of the Act as being particularly oppressive towards motor insurers, who were, after all, given a statutory right under s 8(3) of the Act (see [22] above) to claw back from the insured person whatever moneys had to be paid out as a result.

[44] For the foregoing reasons, I concluded that the second defendant’s purported repudiation of liability under the Policy to indemnify the first defendant in respect of the plaintiff’s claim, pursuant to cl 5.3 of the Policy, was of no effect as far as the plaintiff was concerned, by operation of s 8(1)(a) of the Act. As such, the second defendant was still contractually obliged to indemnify the first defendant against the plaintiff’s claim, and that being the case, there was clearly a policy of motor insurance in existence which obliged an insurer to meet an interim payment, and therefore, in accordance with Griffith LJ’s views in O’Driscoll (see [27] above), O 29 r 11(2)(a) of the Rules of Court did not apply.

[45] It was held in Du Zhao Di (at [29]) that the two limbs of O 29 r 11(2) were to be read disjunctively, so it was sufficient for the success of the plaintiff’s application that at least one of the limbs of O 29 r 11(2) did not apply.

[46] In the event that I was wrong in my construction of O 29 r 11(2)(a) of the Rules of Court, therefore, it was necessary to consider whether the same result would be reached (ie, that the interim payment could be ordered), because O 29 r 11(2)(b) did not apply.

[47] Given the dispute between the parties over whether the evidence in this case established that the first defendant was “a person whose means and resources are such as to enable him to make the interim payment”, whether O 29 r 11(2)(b) applied turned on the issue of the burden of proof, hence my invitation to parties to address me on this point (see [16] above).

[48] Again, what authorities there were shed little light on this matter. Neither Du Zhao Di nor O’Driscoll was applicable, because it was either assumed without argument that the burden rested on the plaintiff (Du Zhao Di at [23] and [30]), or it was accepted that O 29 r 11(2)(b) in fact applied, ie, the defendant did not have the means and resources to enable him to make the interim payment (O’Driscoll). Indeed, I was not directed to any case where the question of the burden of proof under O 29 r 11(2)(b) had arisen for explicit consideration.

[49] Although I was initially inclined to the view that the burden of proof under O 29 r 11(2)(b) rested with the plaintiff, I eventually decided that the burden of proof was on the first defendant, as a result of ss 105 and 108 of the Evidence Act (Cap 97, 1997 Rev Ed) (“the EA”), which provide:

[50] In Wong Leong Wei Edward and another v Acclaim Insurance Brokers Pte Ltd [2010] SGHC 352 at [29], Steven Chong J approved the view (see Sir John Woodroffe & Syed Amir Ali’s Law of Evidence (V Kesava Rao ed) (LexisNexis Butterworths Wadhwa Nagpur, 18 ed, 2008) at p 4476) that s 108 was:

[51] Whether the first defendant had the “means and resources… to enable him to make the interim payment” within the meaning of O 29 r 11(2)(b) was a fact especially within the first defendant’s knowledge, and the first defendant could (dis)prove it without difficulty or inconvenience, whereas it would be impossible or disproportionately difficult for the plaintiff to prove it. After all, it was hard to imagine who else but the first defendant would have knowledge of his financial affairs. Consequently, the first defendant bore the burden of proving that he was not “a person whose means and resources are such as to enable him to make the interim payment”, whether as a particular fact the existence of which he wished me to believe under s 105 of the EA, or as a fact especially within his knowledge under s 108 of the EA.

[52] I found clear support for this approach in The “Asia Star” [2010] 2 SLR 1154, a decision of the Court of Appeal on the duty to mitigate in the context of a breach of a voyage charterparty by the appellant shipowner’s failure to deliver the chartered vessel. In rejecting the respondent charterer’s argument that it had acted reasonably in refusing to spend US$399,500 to engage an alternative available vessel (“the Puma”) and thereby mitigate its loss, because of its impecuniosity, the Court of Appeal held that the burden of proving the fact that chartering the Puma would have been financially prohibitive lay on the respondent, stating (at [63]):

[53] The next question was whether the first defendant had discharged his burden of proof by adducing evidence that he was not “a person whose means and resources are such as to enable him to make the interim payment” under O 29 r 11(2)(b) of the Rules of Court.

[54] No affidavit evidence was produced by the first defendant to prove that he lacked the means and resources to enable him to make the interim payment. In contrast, as Mr Srinivasan pointed out, the first defendant had retained KhattarWong throughout these proceedings and those in the Subordinate Courts (see [14] above), and I was entitled to presume under s 116(f) of the EA that, in the common course of business, KhattarWong would have charged (and the first defendant would have agreed to pay) a not insignificant retainer. On that basis, I was not persuaded that O 29 r 11(2)(b) of the Rules of Court had been made out by the first defendant.

[55] This issue could be taken relatively shortly. Since neither O 29 r 11(2)(a) nor (b) of the Rules of Court applied, it was appropriate for me to exercise my discretion to order interim payment in view of the plaintiff’s dire injuries and his consequent need to pay for his medical treatment, which I was told is ongoing. As for the quantum, Mr Yeo very fairly conceded at the first hearing that if interim payment was to be ordered, he would not quarrel with the sum of $80,000.

[56] This issue initially arose because I considered it possible that, if s 9 of the Act applied in this case, under s 9(1)(a), an interim payment obtained by the plaintiff against the first defendant, being a sum payable under a judgment in respect of a liability required to be covered by the Policy, had to be paid by the second defendant to the Public Trustee (see [22] above).

[57] However, upon further consideration, it became clear to me that s 9 of the Act was not being invoked (because the plaintiff was not making a direct claim against the second defendant but was merely applying for interim payment against the first defendant) and, unlike s 8 (see [44] above), had no other relevance in this case. Therefore, as a matter of course, interim payment was to be paid by the first defendant to the plaintiff personally.

[58] I should add that, thus far, I have not referred to the first and second defendants’ submission that, under s 9 of the Act, the second defendant is only obliged to satisfy final and not interlocutory judgments (see [11] and [13] above). Nonetheless, as both defendants founded themselves strongly upon this argument, it would be a disservice to their counsels’ efforts if I did not articulate my reasons for agreeing with their submissions, albeit only tentatively, because the question of whether s 9 of the Act applied to interlocutory as well as final judgments appeared never to have arisen before and I was therefore unguided by authority on an issue which was not directly pertinent to this application.

[59] First, although s 9 of the Act does not in terms distinguish between final and interlocutory judgments, some of the language in s 9, eg, s 9(2)(a) which speaks of a “judgment for a sum not exceeding the relevant amount” [emphasis added] (see [22] above), more naturally described final rather than interlocutory judgments (see also s 9(3)(b) which speaks of “execution” of the judgment – interlocutory judgments cannot be enforced (Tan Kim Seng v Ibrahim Victor Adam [2004] 1 SLR(R) 181 at [31])).

[60] Second, in virtually all the cases in which s 9 had been successfully relied upon, the third party had obtained final judgment against the insured person. Indeed, it was difficult to imagine why the third party would need to rely on s 9 of the Act to enforce an interlocutory judgment (obtained against the tortfeasor) against the insurer by applying for an interim payment to be paid by the insurer to the Public Trustee. The only situation in which such a course of action was conceivably necessary was where the insurer had purported to repudiate liability to the insured person, but such repudiation was rendered ineffective vis-à-vis the third party due to ss 7 or 8 of the Act, and the third party had obtained interlocutory judgment and an order for interim payment against the insured person, who then absconded from jurisdiction. Even so, however, it was surely more principled to require the third party to avail himself of the normal measures for executing court orders (to enforce the order for interim payment), and/or proceed expeditiously to final judgment before resorting to s 9 of the Act, than to distort the natural language of s 9 in order to force it to encompass interlocutory judgments.

[61] My attention was also drawn to The Public Trustee Practice Circular 1 of 2004: Administration of Accident Compensation Monies under the Motor Vehicles (Third-Party Risks and Compensation) Act (Cap 189), para 7 of which stated clearly that “[t]he Public Trustee will not administer any cases for interim payment only”. Although this was, strictly speaking, an administrative restriction imposed by the Public Trustee rather than a legal one under s 9 of the Act, the Public Trustee’s position reinforced the view that, in practice, there was little or no need for the third party to use s 9 of the Act to enforce an interlocutory judgment (obtained against the tortfeasor) against the insurer.

[62] Had it been necessary to decide the point, therefore, I should have thought that s 9 of the Act ought to be construed as covering only final and not interlocutory judgments. Fortunately, however, the point did not arise in the present case, and therefore I need say no more about this issue.

[63] For all the foregoing reasons, I granted the plaintiff’s application for an interim payment of $80,000 from the first defendant, pursuant to which I made an order in terms of prayers 1 and 2 of the summons.