Abu Talib Bin Baba v Tokio Marine Insurans (M) Berhad

Case Significance

Applies the principle that a single motor policy can provide separate covers to the vehicle owner and to an authorised driver, so that an exclusion for injury to the insured's own employee may bind the owner-employer but not the driver who was not the employer.

This High Court appeal at Muar concerns the construction of a motor insurance policy and the reach of an employer's-liability exclusion. The claim was brought by the representative of the estate of a deceased man who, as an employee of the lorry owner, was travelling in the insured lorry when it was driven negligently by an authorised driver, causing his death. The estate sued in respect of the resulting damages, and the dispute on appeal turned on the position of the insurer, the fifth respondent, Tokio Marine Insurans (M) Berhad. The policy indemnified the owner of the lorry and any authorised driver against third-party risks, but exempted the insurer from liability where death or bodily injury was caused to a person employed by the insured arising out of and in the course of that employment. The insurer relied on that exclusion because the deceased had been the lorry owner's employee. The court held that the exemption could operate only in respect of the insurer's contract with the lorry owner, who was the employer, and not in respect of its separate cover of the authorised driver, who was not the deceased's employer. Applying the Federal Court's decision in Tirumeniyar, described as being on all fours and binding, and the "one policy, two covers" analysis in the commentary before it, the court found that the Sessions Court had not addressed this aspect or that authority. It accordingly allowed the appeal, set aside the declaration the Sessions Court had granted in the insurer's favour, and held the insurer liable to satisfy the judgment, awarding costs of RM5,000 for the appeal together with the costs below. The judgment is a useful application of the principle that a single motor policy can afford separate covers to the owner and the authorised driver, so that an employer-liability exclusion may bind one insured but not the other.