Good news for insurers as the Singapore Court of Appeal confirms that parties in a PIMA claim can enter an interlocutory judgment by consent without admitting causation.
Negligence claims for personal injuries arising from motor vehicle accidents are known as “PIMA” cases. In Crapper Iain Anthony v Salmizan bin Abdullah [2024] SGCA 21 (“Crapper”) the Court of Appeal held that liability does not need to be fully established before a consent interlocutory judgment can be entered in a PIMA case. In doing so, the Court of Appeal has brought to a close a year of uncertainty cause by an earlier High Court decision.
By Donald Spencer, Securus Legal LLC
The Underlying Dispute
The dispute arose out of a road traffic accident in which the Plaintiff’s car was hit into by the Defendant’s motorbike. As a result of the accident, the Plaintiff allegedly suffered neck and back pain. The Plaintiff subsequently filed a personal injury claim in the Magistrates Court. The claim was resisted by the Defendant on the basis, among other grounds, that the Plaintiff’s losses were not caused by the accident. Following negotiations, however, parties entered a consent judgment at 90% in the Plaintiff’s favour using Form 9I of the State Court Practice Directions 2014.
In doing so, parties ticked the box on the form which stated that they were leaving the issues of “damages and causation to be assessed”.
At the subsequent assessment of damages hearing the Defendant agreed to pay $66.65 for the Claimant’s medical expenses and $10.00 for his transport expenses, but the Defendant disputed that there had been any actual injury to the Plaintiff’s neck and back.
The Deputy Registrar hearing the dispute raised a concern that in light of the Court of Appeal decision of Tan Woo Thian v PricewaterhouseCoopers Advisory Services Pte Ltd [2021] 1 SLR 1166 (“Tan Woo Thian”), issues of causation could not be ventilated at an assessment of damages hearing. The Deputy Registrar referenced the Court of Appeal’s pronouncement that in a bifurcated trial the plaintiff at the liability stage would need “to show that he did, in fact, suffer one or more types of loss that was causally connected to the alleged breach”. The Deputy Registrar expressed the view that “there does not seem to be any decision whereby assessment went ahead when parties only consented to [special damages]”.
The Defendant then transferred the case to the General Division of the High Court to seek a determination on the preliminary issues of whether causation could be reserved to the Assessment of Damages stage, and if so, to what extent.
The High Court’s decision in Salmizan
The High Court in Salmizan bin Abdullah v Crapper Iain Anthony [2023] SGHC 75 (“Salmizan”) held that causation cannot be reserved at all to the assessment of damages stage in PIMA cases for the following reasons:
1. A cause of action is complete only when causation between the defendant’s breach and the claimant’s “damage” is established.
2. Allowing the issue of causation to be reserved in full is wrong as the purpose of the assessment stage is to assess damages. This necessarily requires the prior question of liability to have already been settled. The judge considered that the court had no power under the Rules of Court to reserve the issue of causation in full to the assessment of damages stage.
3. Allowing some heads of causation to be raised at the assessment of damages stage provided that the Claimant is able to prove causation in respect of some of his damage at the liability stage is also wrong for the following reasons:
a. Principle: the entering of an interlocutory judgment means that liability has been established and the claimant has the right to claim for damages. If the law allows parties to challenge causation at the assessment stage it creates uncertainty.
b. Precedent: the court noted that local authorities had not addressed the specific question of whether an interlocutory judgment precludes a defendant from challenging causation and the English authorities that were brought to the court’s attention should not be followed. Therefore, there was no binding authority supporting the proposition that causation could be reserved to the assessment of damages stage.
c. Policy: allowing causation to be raised at the assessment of damages stage potentially prolongs disputes and could cause anxiety to claimants as they will have no clarity on what part of his or her claim has been admitted.
The Defendant obtained leave to appeal to the Court of Appeal.
The Court of Appeal’s decision in Crapper
The Defendant’s appeal was successful, with the Court of Appeal holding that liability does not need to be fully established before a consent interlocutory judgment can be entered in the context of PIMA cases.
The Court of Appeal in Crapper reached its decision by considering the wording of the Rules of Court and also by considering precedent cases. The court held that the Rules of Court do not exclude the possibility of entering a consent interlocutory judgment with a reservation as to causation.
With regards to the precedents consider by the High Court judge, the Court of Appeal held that these did not support the proposition that an interlocutory judgment can only be entered after liability has been established. This is because the cases cited did not concern situations where parties had entered interlocutory judgment by consent with an express reservation for causation to be determined at the assessment of damages stage. Instead, the cases concerned default judgments. The Court of Appeal then proceeded to cite further precedent cases which supported a wider interpretation of an “interlocutory judgment”. The Court proceeded to opine that the words “interlocutory” and “judgment” do not invariably mean that liability has been established. Instead, an interlocutory judgment should be understood as being an intermediate judgment that “determines a preliminary or subordinate point but does not finally decide the case”. An interlocutory judgment only decides what the parties have agreed to be decided. This being so, a consent interlocutory judgement can reserve the issue of liability.
At paragraph 48, the Court of Appeal said:
“Under this definition, an interlocutory judgment can be entered by consent on issues that do not wholly establish liability. In such a consent interlocutory judgment, it is for the parties to agree on what had been resolved with res judicata effect and what had not. Implicit in such situations is that the terms of the consent interlocutory judgment would have resolved some issues in dispute but not necessarily liability between the parties. It is difficult to see why parties cannot consent to leave certain issues (even those concerning liability such as causation) to be determined at the second stage of proceedings. For example, it is eminently possible and conceptually consistent for a consent interlocutory judgment to be entered in which the existence and breach of duty of care have been established, but a final judgment whereby causation of damage was not eventually made out and with the result that no damages were due to the claimant.”
The Court of Appeal then proceeded to consider whether bifurcation can be ordered when causation is reserved. The issue here was whether the Rules of Court permits bifurcation of issues other than liability and quantum. The Court of Appeal observed that there was nothing in the Rules of Court and nothing in principle or policy which required bifurcation to be strictly between liability and quantum. The Court cited long standing commercial disputes as an example of disputes being resolved in several tranches. As to when the court should bifurcate between liability and quantum, it would depend on the context of the case.
Finally, the Court reiterated its pronouncement in Tan Woo Thian that causation and damage are necessary elements to establish liability in the tort of negligence”. The Court then reiterated that it does not follow from this that causation and damage must necessarily be admitted for parties to enter into a consent interlocutory judgment.
Impact of Salmizan and Crapper
As noted by Deputy Registrar Vince Gui in Kek Lai Quan (Guo Laiquan) v Lim Junyou [2022] SGMC 7, prior to Salmizan, “it was common practice for parties to motor accident claims to enter interlocutory judgment by consent on the understanding that the defendant would be allowed to challenge the causation of injuries in toto at the assessment of damages” However, following the release of Salmizan this practice came to a sharp stop. Further, whilst Salmizan was a PIMA case, it was considered to apply to negligence cases more widely by parity of reasoning (see for example Darwin-51 Car Rental v Yan Yin Lai Jean [2023] SGMC 99).
The impact of Salmizan was that defendants in personal injury and non-injury motor accident cases found themselves having to reconsider their litigation strategies as it was no longer considered possible to raise causation arguments at the assessment of damages stage. In many cases, defendants declined to enter into consent interlocutory judgments and in some instances, sought to set aside such judgments, arguing they had been agreed upon with the understanding that causation could be contested later (Muhammad Tirmidzi Bin Misnawi v Agnes Chai Yui Yun [2023] SGDC 100).
So far reaching was the impact of Salmizan that in Foo Kok Boon v Ngow Kheong Shen and others and another matter [2023] SGHC 189, the High Court applied the doctrine of prospective overruling to Salmizan. This meant Salmizan did not apply to cases where an interlocutory judgment was entered before 30 March 2023. This spared many defendants the need to set aside default judgments.
The inability to reserve the issue of causation to the assessment of damages stage caused profound change in the way defendant lawyers (commonly engaged by insurance companies) run their litigations. It was now necessary to consider obtaining expert advice on issues of causation and extent of damage at the liability stage, thereby frontloading workload. It also meant that many disputes were prepared on the basis that there would be no bifurcation of issues.
In the State Courts (which handles most motor accident and personal injury claims) the practice developed of sending un-bifurcated matters first for a trial on “responsibility for the accident”. At the responsibility stage the court would determine whether an accident happened and whether there was a breach of duty by the Defendant. If the court gave a finding in favour of the plaintiff, the matter would then move on to the second stage where the remaining issues such as causation, remoteness and quantification of damages would be addressed (see for example Alim Abdul v Ho Eng Huat Construction Pte Ltd [2024] SGDC 44 and Gurjit Singh v Chemori Industries Pte Ltd [2024] SGDC 3).
The Court of Appeal's decision in Crapper should be welcomed as bringing clarity and certainty to the issues the issues of causation and the effect of entering an interlocutory judgment. While the Court’s pronouncements in Crapper were focused on PIMA cases, it is anticipated that the ruling will be applied broadly in the way that Salmizan was.
The Crapper decision is good news for insurers as it reinstates the possibility of entering into consent interlocutory judgments which reserve causation. Such judgments are a useful case management tool as they save parties the expense of proceeding to trial in cases in which there is actually no dispute about how an accident happened. Further, the having a clear precedent from the apex cause has provided a predictable legal landscape which will aid insurers in managing their legal costs and risks exposures in future cases.
The author expects that in due course a practice of entering of consent interlocutory judgements reserving causation will develop. The author also expects that Form 7 in the State Court Practice Directions 2021 (the current equivalent of the Form 9I in Salmizan and Crapper) will be updated to provide a tick box option for entering into such judgments. When entering such judgments, or when agreeing to the scope of bifurcation, parties should take care to be precise and clear in their drafting (see paragraphs 33 and 34 of Choo Yew Liang Sebastian v Koh Yew Teck and another (Direct Asia Insurance (Singapore) Pte Ltd, third party) (Etiqa Insurance Pte Ltd, intervener) [2024] SGHC 212). Care should be taken in the selection of terms used in draft judgments as terms like admitting “liability” or agreeing that there is “contributory negligence” may be taken as implying that causation has been agreed to.