ZURICH GENERAL INSURANCE MALAYSIA BERHAD v 1. ) VICKNESWARAN A/L KALAISELVAN 2. ) AMIR HAIKAL BIN KAMARUZAMAN 3. ) KAVITHA A/P RAVI SANGKAR

Case Significance

Instructive on the distinction between a legal interest and a mere commercial interest, and the absence of locus standi for an insurer to intervene in a running-down action at the liability stage.

This High Court decision at Johor Bahru is an appeal by an insurer against a Sessions Court's refusal to allow it to intervene as a proposed intervener in a running-down action. The appellant, Zurich General Insurance Malaysia Berhad, the insurer of the defendant in a road-accident suit between the plaintiffs and the defendant, had applied in the Sessions Court to intervene as a proposed intervener or second defendant, and the Sessions Court had dismissed that application with costs. On appeal, the court, per Manira binti Mohd Nor JC, dismissed the appeal and affirmed the Sessions Court's decision. It held that the Sessions Court's decision was entirely correct and disclosed no misdirection of fact or law warranting interference, and observed that the appeal not only lacked merit but reflected a serious confusion about the fundamental principles governing the role of insurance in a tort action. The central issue in the underlying action was the liability and quantum arising from the accident, and the court drew the distinction between a legal interest and a mere commercial interest, holding that the insurer had no locus standi to intervene: its interest was commercial rather than legal at the liability stage, the allegations of fraud had not been pleaded and were irrelevant, and the insurance policy and questions of coverage were not relevant to the determination of liability. Intervention would only delay and prolong the trial of the action. The court restated the settled principle that an appellate court will interfere with the discretion of the Sessions Court only where there is a misdirection of law, a misapprehension of the facts, a failure to consider relevant facts, or a decision that is unreasonable, and found none of those present, the Sessions Court judge having given full and comprehensive reasons. The appeal was accordingly dismissed with costs of RM5,000. The judgment is instructive on the distinction between a legal and a commercial interest and the absence of locus standi for an insurer to intervene in a running-down action at the liability stage.