Hartford Insurance v Chiu Teng: Third Party Rights Against Insurers & Indemnity

In The Hartford Insurance Company (Singapore) Ltd v Chiu Teng Construction Pte Ltd, the Singapore Court of Appeal heard an appeal by Hartford Insurance against a High Court decision holding them liable to indemnify Chiu Teng, a third party, under an 'all risk' insurance policy. Chiu Teng, the main contractor for a housing development, sought to recover losses from Brentford Construction, whose work caused damage to the development. After Brentford was wound up, Chiu Teng obtained a judgment against them and then sought payment from Hartford, Brentford's insurer, under the Third Parties (Rights against Insurers) Act. Hartford argued that the judgment against Brentford was not binding on them and that Chiu Teng should prove their losses again. The Court of Appeal dismissed Hartford's appeal, holding that Hartford was bound by the earlier judgment and had to indemnify Chiu Teng.

1. Case Overview

1.1 Court

Court of Appeal of the Republic of Singapore

1.2 Outcome

Appeal Dismissed

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Hartford Insurance appealed a decision holding them liable to indemnify Chiu Teng, a third party, under an 'all risk' policy. The court dismissed the appeal.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
The Hartford Insurance Company (Singapore) LtdAppellantCorporationAppeal DismissedLostTeo Weng Kie
Chiu Teng Construction Pte LtdRespondentCorporationAppeal DismissedWonMichael Eu

3. Judges

Judge NameTitleDelivered Judgment
Chao Hick TinJudge of AppealNo
L P TheanJudge of AppealNo
Yong Pung HowChief JusticeYes

4. Counsels

Counsel NameOrganization
Teo Weng KieKhattar Wong & Partners
Michael EuComlaw LLC

4. Facts

  1. Chiu Teng was the main contractor for 'The Countryside' housing development.
  2. Brentford Construction caused damage to houses in the estate while performing work on an adjacent lot.
  3. Chiu Teng carried out rectification works, including installing micropiles, due to the damage.
  4. Brentford was wound up by a court order.
  5. Chiu Teng obtained an interlocutory judgment against Brentford with the consent of the Official Receiver.
  6. Hartford was informed of the action but chose not to get involved, believing they were not liable under the policy.
  7. Chiu Teng commenced an action against Hartford seeking payment of the judgment sum based on the Third Parties (Rights against Insurers) Act.

5. Formal Citations

  1. The Hartford Insurance Company (Singapore) Ltd v Chiu Teng Construction Pte Ltd, CA 600079/2001, [2002] SGCA 5

6. Timeline

DateEvent
Brentford Construction caused damage to houses in 'The Countryside' estate
Brentford Construction wound up by court order
Chiu Teng obtained leave of court to commence proceedings against Brentford
Writ issued by Chiu Teng against Brentford
Interlocutory judgment obtained by Chiu Teng with consent of the Official Receiver
Judgment for $466,600.08 granted to Chiu Teng
Chiu Teng commenced action against Hartford Insurance
Appeal dismissed

7. Legal Issues

  1. Indemnity
    • Outcome: The court held that Hartford was required to indemnify Chiu Teng.
    • Category: Substantive
  2. Third Party Rights Against Insurers
    • Outcome: The court held that Chiu Teng, as a third party, could step into the shoes of Brentford and claim against Hartford under the Act.
    • Category: Substantive
  3. Estoppel
    • Outcome: The court held that Hartford was estopped from challenging the quantum of loss due to the earlier judgment against Brentford.
    • Category: Procedural

8. Remedies Sought

  1. Payment of Judgment Sum
  2. Indemnification

9. Cause of Actions

  • Breach of Insurance Contract
  • Claim under Third Parties (Rights against Insurers) Act

10. Practice Areas

  • Insurance Litigation
  • Construction Disputes

11. Industries

  • Insurance
  • Construction

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Ben Shipping Co (Pte) Ltd v Ah Bord Bainne The C JoyceiN/AYes[1986] 2 All ER 177N/ADistinguished from the present case as it did not deal with an express obligation to indemnify but with a supposedly implied obligation of indemnity.
Mercantile Investment & General Trust Co v River Plate Trust, Loan and Agency CoN/AYes[1894] 1 Ch 578N/ADistinguished from the present case because there was no equivalent provision to s 1(1) of the 1930 Act which the court there had to consider.
Parker v LewisN/AYes[1873] 8 Chancery App 1035N/ACited for the principle that in cases of express contract of indemnity, a judgment against the indemnitee is conclusive against the indemnifier if the indemnifier was given notice and an opportunity to defend the action.
Post Office v Norwich Union Fire Insurance Society LtdCourt of AppealYes[1967] 1 All ERN/AReaffirmed the need for an insured to establish legal liability to a third party before seeking indemnity from insurers.
Re Harrington Motor CoN/AYes[1982] 1 Ch 105N/ACited to establish that at common law, Chiu Teng would have no claim against Hartford, the insurer.
West Wake Price & Co v ChingN/AYes[1957] 1 WLR 45N/ACited for the principle that the assured must prove a loss before recovering under an indemnity clause.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
Third Parties (Rights Against Insurers) Act (Cap 395)Singapore
Application of English Law Act (Cap 7A)Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • All Risk Policy
  • Third Parties (Rights against Insurers) Act
  • Indemnity
  • Winding Up
  • Interlocutory Judgment
  • Rectification Works
  • Micropiles
  • Estoppel

15.2 Keywords

  • insurance
  • construction
  • indemnity
  • third party rights
  • Singapore
  • Hartford Insurance
  • Chiu Teng

16. Subjects

  • Insurance
  • Construction
  • Civil Procedure

17. Areas of Law

  • Insurance Law
  • Third Party Rights Against Insurers
  • Construction Law