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2016 MarsdenLR 1344

HIGH COURT MALAYA KUALA LUMPUR
MMIP SERVICES SDN BHD – Appellant
Versus
OVERSEAS ASSURANCE CORPORATION (MALAYSIA) BERHAD; IUB GREENGOLD BERHAD (THI.... – Respondent
[Civil Suit No: 22NCC-121-05-2015]



Petitioner Advocates:Sreether Sundaram ,Respondent Advocate: M Nagarajah,Michael Anthony

A party not privy to a contract lacks standing to sue to enforce it, emphasizing the doctrine of privity of contract.

Headnote:This judgment examines the plaintiff's standing to sue under the High Risks Motor Insurance Pool Collective Agreement (CA). The court finds that the plaintiff, not being a party to the CA, lacks the power to commence proceedings. The ruling affirms that such claims must be brought by the Council representing the parties to the CA, as outlined in clauses 8.4(h) and 9.5(e). The court distinguishes the lack of jurisdiction from the arbitration agreement, concluding it retains authority to address the matter. The applications to strike out are considered, establishing grounds on the abuse of process and jurisdiction deficiencies.

Judgement Key Points
Date Event Description Reference(s)
Not specified Initiation of legal proceedings by the plaintiff acting as an agent for the principal parties. (!) (!)
Not specified Court's decision that the plaintiff lacked standing to enforce the contract due to privity of contract. (!) (!) (!)
Not specified Court's ruling that contractual enforcement mechanisms are exclusive and that bypassing them is an abuse of process. (!) (!)
Not specified Determination that the defendant did not assume liability under the transfer agreement. (!) (!)
Not specified Clarification that the High Court's confirmation order did not extend liability to the defendant for third-party liabilities. (!)
Not specified Affirmation that arbitration agreements do not restrict courts from hearing matters outside arbitration scope. (!) (!) (!)

Table of Content
1. jurisdiction based on contractual parties (Para 1 , 2)
JUDGMENT

Wong Kian Kheong JC:

A. Introduction

[1] This suit ("this suit") concerns, among others, the following issues:

(1) whether the plaintiff company ("plaintiff"), an "Administration Manager" of the "Malaysian Motor Insurance Pool" ("MIMP"), has the right and/or power to file this suit in the plaintiffs own name to enforce the "High Risks Motor Insurance Pool Collective Agreement" (" CA ") dated 16 November 1992 when, among others:

(a) the plaintiff is not a party to the CA ;

(b) the plaintiff as an agent cannot file this suit in the plaintiffs name on behalf of the plaintiffs principal;

(c) the CA does not provide any right and/or power for the plaintiff to file this suit; and

(d) the CA has expressly provided for a specific mechanism to enforce the by parties specified in the .

(2) whether the liability of the third party in this suit (Tahan Insurance Malaysia Bhd ("TIMB")) to make contributions to the MIMP under the CA ("TIMBs liability") had been assumed by the defendant company (defendant) by reason of the "Business Portfolio Transfer Agreement" dated 18 August 2012 (BPTA) between the defendant and TIMB;

(3) whether the High Courts order dated 15 October 2010 confirming the BPTA (High Courts confirmation order) under ss 128(1), 133(3), (4) and 135(1)(b) of the then applicable Insurance Act 1996 ("IA"), had vested the TIMBs liability in the defendant;

(4) whether the plaintiff can rely on a letter from the defendant and the wide application of the equitable estoppel doctrine to constitute a cause of action against the defendant;

(5) whether TIMB can rely on O 12 r 10(1)(a) and (g) of the Rules of 2012 ("ROC") to set aside the service of the third party notice issued by the defendant to TIMB ("third party notice"); (6) whether TIMB can strike out the third party notice under O 18 r 19(1)(a) RC; and

(7) if an arbitration agreement applies in a case, does such an application deprive the Court of jurisdiction to try the case?

B. Background

[2] The CA was entered into by motor insurance companies, including the defendant and TIMB. According to the , among others:

(1) before the conclusion of the CA , all the parties to the , defined in cl 1 to be the "General Body", had been operating an "Unplaced Motor Pool" pursuant to the "Unplaced Motor Pool Agreement" ("first Pool Agreement") wherein parties to the first Pool Agreement had provided on a collective basis, insurance for motor vehicles which could not readily find an insurer in the Malaysian general insurance market - Recital to the ("Recital");

(2) the CA recorded the intention of the General Body to replace the Unplaced Motor Pool with the MIMP by a more comprehensive agreement (namely the ) and the was intended to be a continuation of the first Pool Agreement - Recital;

(3) members of a "Council" shall be elected by parties to the CA at a General Body meeting and shall consist of either the "Principal Officers" or General Managers of the parties to the - cl 9.1 (cl 9.1). Regarding the Council:

(a) cl 9.7 CA (cl 9.7) states that the Council is "vested with all powers to act on behalf of the parties hereto in all matters relating to the Pool except to the extent such powers are reserved to be exercised by the General Body";

(b) the Council has the power to "commence ... any actions, suits or other proceedings against ... any person, firm, company in respect of any matters or things relating to the conduct, business, contracts or dealings arising from or in connection with the Pool" - cl 9.5(e) CA (cl 9.5(e)); and

(c) cl 9.5(g) CA (cl 9.5(g)) provides power to the Council to "delegate to any person any of its functions, responsibilities and powers upon such terms and conditions as [the Council] deems fit";

(4) cl 8.1 CA (cl 8.1) provides that the Administration Manager "shall be appointed by the Council on behalf of the parties" to the . Under cl 8.2 (cl 8.2), the "Cou

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