The insurance broker fulfilled its duty of care, and the plaintiffs failed to prove negligence caused their alleged damages.

JUDGMENT

John Lee Kien How @ Mohd Johan Lee JC:

Introduction

[1] MSM Malaysia Holdings Berhad ('1st Plaintiff') and the beneficiaries of the late Dato' Sheikh Awab bin Sheikh Abod ('the Deceased') namely the 2nd and 3rd Plaintiffs filed this suit against Transnational Insurance Brokers (M) Sdn Bhd ('the Defendant') alleging that the Defendant had acted negligently and had failed to perform their duty as broker and risk consultant of the 1st Plaintiff.

Background Facts

[2] This 1st Plaintiff is a public company listed on the Main Market of Bursa Malaysia Securities Sdn Bhd and was incorporated pursuant to the Companies Act 1965 . The 2nd and 3rd Plaintiffs are the administrators and the beneficiaries of the Deceased.

[3] Meanwhile, the Defendant is a company limited by shares and incorporated pursuant to the Companies Act 1965 . The Defendant acted as the insurance broker and risk consultant for the 1st Plaintiff at all material times. The Defendant had procured a group term takaful for the 1st Plaintiff from Takaful Ikhlas Berhad ('Takaful Ikhlas') in accordance with the terms and conditions contained in the Group Term Takaful Certificate No GTT00447 ('the Certificate') for the period between 15 September 2015 and 14 September 2016.

[4] The following were, inter alia, the terms and conditions of the Certificate:

4.1 That the 'free cover limit' was for the sum of RM1,000,000.00 (the 'FCL'); and

4.2 That every person(s) whose cover exceeded the maximum sum under the FCL shall produce health evidence in the form and manner prescribed by Takaful Ikhlas before such coverage under the Certificate shall become effective.

[5] Later, the 1st Plaintiff had requested for the FCL to be increased in respect of several of its members and/or employees ('Selected Employees'). For the Deceased, the proposed sum covered and increase was in the sum of RM5,990,400.00 ('the PSC'). To do so, the Selected Employees, including the Deceased, were to comply with the requirement to undergo medical examination. Any failure to do so would result in the cover sum for the particular staff remained at RM1,000,000.00 million as provided under the FCL.

[6] The dispute arose when the Deceased passed away on 14 April 2016. The medical reports had yet to be procured and furnished to Takaful Ikhlas. Consequently, on 28 July 2016, Takaful Ikhlas only paid out the FCL for the Deceased because of the non-submission of the medical reports. The Plaintiffs' stance was that at all material times, the production of the medical reports was wrongfully delayed by the Defendant and thus causing the cover sum for the Deceased remained at the FCL, namely, RM1million only.

[7]In response, the Defendant denied that it has breached any duty to the 1st Plaintiff in regard to the application for the PSC. The Defendant stressed that its duty is to advice the 1st Plaintiff and the Deceased to undergo a medical examination. It has done so rightly.

[8]As the Plaintiffs were not satisfied with the Defendant's response, they filed this suit against the Defendant ('this Suit'). In this Suit, the Plaintiffs were, in essence seeking the following:

a. Damages for breach of contract;

b. Damages in the sum of RM5,990,400.00 for negligence or alternatively damages in a sum to be assessed by this Honourable Court;

c. Interest on sums found payable by the Defendant at the rate of 5% per annum from date of judgment to date of full realization;

d. Costs; and

e. Such other order as this Court thinks fit and proper.

The Trial

[9]During the trial, both parties called four (4) witnesses respectively. The eight (8) witnesses were:

SP1 Datin Rozaini Binti Mohd Yusoff

SP2 Nik Ariff Izani Bin Nik Ahmed Mazlan

SP3 Norzanariza Bt Mohd Pauzi SP4 Nor'aini Binti Hashim

SD1 Roshidi Bin Muhammad Shariff

SD2 Muhammad Azwan Bin Nazri

SD3 Rozad Bin Harin

SD4 Zainal Abidin Aziz

The Plaintiffs' Case

[10] The gist of the 1st Plaintiff's claim was grounded in both contract and the tort of professional negligence, whereas the 2nd and 3rd Plaintiffs