Gill Singh has worked in the insurance industry since the mid 1970s. In late 2006, he met his former colleague and friend, Mr Wong, to discuss future opportunities. Wong was the Chief Executive Officer of Dah Sing, an insurance company. Eventually Singh was appointed a senior district manager of Dah Sing in January 2007. However, things did not go as well as expected and he was terminated in August the same year.
The insurance company then sued Singh in the District Court to try to recover back a $150,000 sign-on fee and two monthly allowances of $50,000 each. The contract which Singh signed stated that the sign-on fee was repayable in full if Singh was terminated within three years of his appointment. However it did not say anything about recovering monthly allowances that were paid. With the assistance of legal aid, Singh counterclaimed for losses he suffered as a result of the company's failure to report his termination to the Insurance Agents Registration Board (IARB); he could not work for another insurance company as a technical representative or insurance agent until such termination had been registered. He also counterclaimed for losses arising from the company's failure to report his continuing professional development (CPD) certificate to the IARB, thereby resulting in his suspension from registration as an insurance agent for three months. The company argued that it was not in breach of any duty owed to Singh and there was no right of action under the law for any of these breaches.
On 18 May 2012, the District Court
ruled in Singh's favour and held that the two months of paid monthly allowances were not recoverable and that Singh was entitled to damages for the company's breaches of duty in respect of the non-reporting to IARB of Singh's termination and his CPD certificate. But the company appealed to the Court of Appeal, and on 23 December 2013 the Court of Appeal
reversed the District Court's decision. The Court of Appeal found that the legislation did not create a private right of action for the alleged breaches and the company did not owe a duty of care to Singh. It also found that even if there was a breach, Singh did not suffer any losses. After being advised by senior counsel that there was no merit in an appeal, it seemed like this was the end of the road for Singh.
It was at this point that the HKU Clinical Legal Education Centre became involved when Singh made an appointment to seek legal advice from the Centre. After an initial meeting in January 2014 with the two law students assigned to the case, Phoebe Suen (then Gov't & Laws 5) and Joel Lee (then LLB 3), the two students diligently researched and prepared a 17-page memo pointing out the likely errors of the Court of Appeal for the advising lawyer, Eric Cheung, principal lecturer and director of clinical legal education. Cheung read the memo and immediately thought there was a case to take up to the Court of Final Appeal (CFA). To confirm his beliefs, he sought the advice of the tort law experts in the Faculty of Law. Eventually, after advising the client and obtaining his instructions, Cheung wrote to the Legal Aid Department and convinced them to change their decision and to fund the appeal to the apex court. At this stage, Audrey Eu SC leading Kelvin Leung, took over the case but with the continued assistance of various law students up until the case was argued before the CFA in February 2016.
On 31 March 2016, the CFA unanimously allowed Singh's appeal and restored the District Court's decision (
Dah Sing Insurance Services Limited v Gill Gurbux Singh, FACV18/2015). Writing for the Court, Mr Justice Tang held that the company had a common law duty of care to make timely reports of termination and CPD certificates to the IARB so as to avoid foreseeable loss to representatives and agents like Singh. The duties were found in the Code of Practice for the Administration of Insurance Agents. The decision is an important precedent on the tort liability of insurance companies to their agents and representatives in respect of duties under the Code of Practice.
This was not the first time for a client of the HKU Clinical Legal Education Centre to win a case in the CFA. In October 2015, the CFA allowed the appeal in
HKSAR v Law Yat Ting [2015] HKCFA 71, a case concerned with whether closing a car door constituted tampering with a motor vehicle. The injustice had been so obvious that the Department of Justice conceded the appeal and the CFA decided the matter without an oral hearing.
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