JUDGMENT

Abdul Malik JCA:

The Sole Issue

[1] There was only one issue for determination by this court and that was whether the respondent (Commercial Union Assurance (Malaysia) Sdn Bhd) was liable to make any payment to the appellant (Tiong Nam Trading & Transport (M) Sdn Bhd) under the Marine Goods-In-Transit/Carrier Liability Policy No: 05Q201582 MOC (hereinafter referred to as the "Carrier Liability Policy")? I would answer this question in the positive and I will now set out the reasons thereto. I must, however, put on record that I have read the judgment of my learned brother KN Segara, JCA and agree with the views which he held and has expressed.

Background Facts

[2] Before the High Court vide civil suit no: S1-23-41-1994 (hereinafter referred to as "the High Court suit"), the plaintiff (Leader Cable Industry Berhad) brought an action against the defendant (Tiong Nam Trading & Transport (M) Sdn Bhd) for negligence and/or breach of contract entered into between the parties.

[3] The plaintiff (Leader Cable Industry Berhad) was and is, at all material times, manufacturers of telecommunication cables.

[4] While the defendant (Tiong Nam Trading & Transport (M) Sdn Bhd) was and is, at all material times, a transport company described as carriers and bailees of goods for hire and reward in the statement of claim.

[5] The defendant (Tiong Nam Trading & Transport (M) Sdn Bhd) agreed to carry eight drums of the plaintiff's (Leader Cable Industry Berhad) telecommunication cables from Sungai Petani in Kedah to Bukit Kemuning in Klang, Selangor.

[6] It was a term of the agreement that the defendant (Tiong Nam Trading & Transport (M) Sdn Bhd) would exercise reasonable care and skill in the carriage of the telecommunication cables. The authorised driver of the motor lorry was Ramachandran Naidu a/l Abai Naidu - the first third party.

[7] The plaintiff (Leader Cable Industry Berhad) took an insurance coverage from Taisho Marine & Fire Insurance (M) Sdn Bhd to insure the telecommunication cables that were transported. That insurance coverage is called the Marine Cargo Policy No: PGD/CINT/93-001624.

[8] The defendant (Tiong Nam Trading & Transport (M) Sdn Bhd) also took an insurance coverage, in consideration of the annual flat premium of RM150,000, from the second third party (Commercial Union Assurance (Malaysia) Sdn Bhd). That insurance coverage was valid for the period from 28 February 1992 to 27 February 1993. As alluded to earlier, that insurance coverage is now referred to as the Carrier Liability Policy.

[9] On or about 10 February 1993, the defendant's (Tiong Nam Trading & Transport (M) Sdn Bhd) motor lorry whilst transporting the telecommunication cables belonging to the plaintiff (Leader Cable Industry Berhad) overturned at or along 14 1/2 milestone, Jalan Cheras/Kajang, which resulted in the damage to the telecommunication cables belonging to the plaintiff (Leader Cable Industry Berhad).

[10] The plaintiff (Leader Cable Industry Berhad) sued the defendant (Tiong Nam Trading & Transport (M) Sdn Bhd) for negligence and/or breach of contract and sought for those damages as set out in the statement of claim at pp. 35 to 36 of the appeal record ("AR").

[11] The defendant (Tiong Nam Trading & Transport (M) Sdn Bhd) denied liability and averred that they are entitled to an indemnity in full or to a contribution from the first third party (Ramachandran Naidu a/l Abai Naidu) who was the driver of the motor lorry at the material time and also from the second third party (Commercial Union Assurance (Malaysia) Sdn Bhd) who was the insurers for the defendant (Tiong Nam Trading & Transport (M) Sdn Bhd), at the material time.

[12] When the High Court suit came up for hearing on 23 April 1998, the plaintiff (Leader Cable Industry Berhad) and the defendant (Tiong Nam Trading & Transport (M) Sdn Bhd) entered into a consent judgment for the sum of RM100,000 as damages with costs at RM10,000. As a result of the consent judgment, the defendant (Ti