JUDGMENT

Abdull Hamid Embong JCA:

(1) On 30 January 1996, a road accident happened involving motorlorry No. WT 1835 belonging to Syarikat Jagoh Angkat Sdn Bhd. which was driven by one Katurajah a/l Subramaniam. Riding as a passenger with him was one Kanisan a/l Gopal (the deceased), who died in that accident. The motorlorry was insured by the respondent in this appeal (now referred to as P&O).

(2) A civil suit which we now refer to as the "liability action" was filed at the Taiping Sessions Court, which after a full trial found the defendant, ie, Kumpulan Jagoh Angkut Sdn Bhd to be 100% vicariously liable for the negligence of its driver Katurajah.

(3) Upon appeal against that decision, in the liability action, the High Court dismissed the appeal against liability but reduced the initial quantum of RM74,100 general damages and RM1,599 as special damages to RM52,899.50.

(4) The appellant next filed a separate action, ie, GS 52-97-01 (the recovery action) against P&O as the insurers. This recovery action was filed pursuant to s.96(1) Road Transport Act, 1987 (RTA). P&O in its defence stated that the coverage is subject to the terms and condition of its insurance policy. It was P&Os case that the deceased was a mere passenger and not in the employment of Kumpulan Jagoh Angkut Sdn Bhd. The liability clause in the policy had stated that P&O shall not be liable in respect of:

Death of or bodily injury to any person (other than a passenger carried by reason of or in pursuance of a contract of employment) (emphasis added)

It was thus the firm stand of P&O that they cannot be liable pursuant to the exception as stated in the brackets above under the terms of the policy.

(5) On 26 October 2001, the Sessions Court allowed the appellants claim under the recovery action.

(6) On appeal by P&O, the High Court reversed that decision and held that P&O cannot be liable in view of the exception to liability under the policys terms.

(7) The learned High Court judge in coming to his decision to allow the appeal, considered the evidence adduced and found the deceased not to be a person who was in a contract of service with Kumpulan Jagoh Angkut Sdn Bhd. It was against this finding of facts by the appellate judge that this issue is now argued before us.

(8) The relevant passage of the High Courts decision is now reproduced. It says:

Daripada keterangan SP3 adalah jelas bahawa simati mempunyai pilihan sama ada mahu bekerja atau tidak. Pemandu lori tidak boleh memaksa simati mengikutinya sekiranya simati tidak mahu. Simati sendiri yang menentukan sama ada ia hendak mengikut pemandu lori tersebut. Menurut SP3 pengangkut simen adalah pekerja bebas (free lance). Mereka datang bekerja mengikut kehendak hati mereka. Pemandu akan hanya mengambil mana-mana pekerja yang menawarkan khidmat mereka. Pemandu menawarkan kerja kepada mereka dan terpulang kepada pengangkut simen ini hendak menerima atau menolak tawaran tersebut.

Pengambil insuran tidak mengawal cara mana simati perlu melakukan kerjanya. Hal ini ditentukan oleh pembeli simen yang membayar upah simati. Majikan simati ialah pembeli simen.

(9) The High Court also considered the four indicia for a contract of service to exist as laid down by the Federal Court in Employees Provident Fund Board v. Ms Ally Co Ltd in determining whether, on the facts, the deceased was truly one within Kumpulan Jagoh Angkut Sdn Bhds contract of service. These are:

(i) The masters power of selection of his servant,

(ii) The payment of wages or other remuneration,

(iii) The masters right to control the method of doing the work, and

(iv) The masters right of suspension or dismissal.

(10) We have critically perused the evidence led especially that of SD2, SP3 and SP2 and find ourselves in agreement with the High Court in deciding that the deceased was not in a contract of service of Kumpulan Jagoh Angkut Sdn Bhd. Most telling is the evidence of SP2, who stated that there would always be a group of persons out