Asian Casualty Report by jonlucas


									                                                                                                 June 2007
                                                                                                9th Edition

Asian Casualty Report

             Contents          Accident/Damage Summary Table . . . . . . . . . . . . . . 2
                               Contents by Country           ........................ 3
                               Commercial General Liability/Public Liability/
                               Products Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
                               Construction Liability . . . . . . . . . . . . . . . . . . . . . . . . 7
                               Professional Indemnity/Errors & Omissions . . . . . . . 7
                               Medical Malpractice Liability . . . . . . . . . . . . . . . . . . 8
                               Workmen’s Compensation & Employers’ Liability                      . . 11
                               Directors’ & Officers’ Liability . . . . . . . . . . . . . . . . . . 13
                               Employment Practices Liability . . . . . . . . . . . . . . . . . 13
                               Automobile Liability . . . . . . . . . . . . . . . . . . . . . . . . . 14
                               Environmental Liability . . . . . . . . . . . . . . . . . . . . . . . 15

A Berkshire Hathaway Company
Summary of some typical claims in various countries

                                                         Amount Sought      Amount Awarded
Country     Accident Type      Injury Type                                                 Note                              Page
                                                         by Victim          or Settled
                               Fatality and bodily
                                                                                           Tainted blood during
China       Bodily injury      injury by AIDS for 18                        USD2.5m                                           8
                                                                                           blood transfusions

                                                         Between USD2.8m
                                                                                           Broken gas well affected
Indonesia   Property damage House damages                to USD100m         Pending                                           4
                                                                                           4,000 villagers

                                                                                           Hepatitis infection due to
Japan       Bodily injury      Hepatitis to 9 patients                      USD2.07m       tainted-blood-clotting             7

Japan       Bodily injury      Fatality                                     USD606,184     Creutzfeldt-Jakob disease          8

Malaysia    Bodily injury      Suffering                 USD295,942         Pending        False HIV diagnosis                8

Malaysia    Bodily injury      Permanent disability                         USD147,971     Quadriplegia                       9

Malaysia    Bodily injury      Permanent disability                         USD32,558      Motorcycle accident (motor)        14

Malaysia    Bodily injury      Permenent disability                         USD2.59m       Car accident (motor)               14

Malaysia    Financial loss     Wrongful dismissal                           USD175,869                                        13

Malaysia    Financial loss     Wrongful dismissal                           USD384,725                                        13

Singapore   Bodily injury      Permanent disability                         USD1.06m       Liver failure due to slim pills    4

                                                         mental damage +
Singapore   Bodily injury      Mental damage                                Pending        Botched “exorcism”                 5
                                                         medical costs

Singapore   Bodily injury      Fatality                                     USD72,193      Workmen’s compensation             5

                               Awry-went stent                                             One year in hospital
Singapore   Bodily injury                                USD364,216         Pending                                           10
                               operation                                                   instead of planned two
                               7 workers injured,
Singapore   Bodily injury                                                   USD1,404,617   Roof collapse                      8
                               1 fatality

                                                         USD162,596 to
Singapore   Bodily injury      Fatality                                     Pending        Temporary wall caved in            11

                                                                                           Heart attack (workers
Singapore   Bodily injury      Fatality                                     USD56,817                                         11

Singapore   Bodily injury      Permanent disability                         USD195,116     Motorcycle accident (motor)        14

Singapore   Bodily injury      Fatality                                     USD3m          Motorcycle accident (motor)        14

Singapore   Bodily injury      Fatality                  USD250,000         Pending        Car accident (motor)               15

                                                                                           Omission to inform
Singapore   Financial loss     Auditors Infringement                        USD504,049     management about                   7
                                                                                           financial irregularities

                                                         USD81,948 for
                                                         golden dragon
                               Flooding of a fish
Singapore   Loss of property                             arowanas and       Pending        Fish farm’s damage                 5
                                                         USD31,218 repair

                                                                                           House damage due to
Singapore   Property damage    House damage                                 USD247,146                                        6
                                                                                           Circle Line works

                                                                                           House damage due to an
Singapore   Property damage House damage                                    USD325,193                                        6
                                                                                           uncleaned exhaust
Contents by Country                                                                          Construction Liability
                                                                                             Burst water pipe caused flooding in a shopping centre ......                       7
                                                                                             Twenty unsafe scaffolding sites ordered to cease operations                        7
                                                                                             Professional Indemnity/Errors & Omissions
Commercial General Liability/Public Liability/
                                                                                             Gaelic Inns public house chain awarded SGD775,000
Products Liability
                                                                                             against auditors ...............................................................   7
At least six fatal casualties due to poorly sterilized
                                                                                             Eighty-eight-year-old woman died after doctor mistakenly
antibiotics ........................................................................     4
                                                                                             prescribed too high a dose of heart medication .................                   8
Medical Malpractice Liability                                                                Government seeks SGD1.6m over school roof collapse ........                        8
AIDS patients win landmark CNY19,23m damages ............                                8
                                                                                             Medical Malpractice Liability
Environmental Liability                                                                      Dispute mediation helps both patients and dentists ........... 9
Over 2,000 feared to have lead poisoning in China ............ 15                            Thinking of suing your doctor? Both parties
                                                                                             must talk first ................................................................... 9
Hong Kong                                                                                    Hospital bill ballooned from SGD15,000 to SGD560,000 .... 10
Employment Practices Liability                                                               Workmen’s Compensation & Employers’ Liability
Sacked pilots file suit against Cathay ................................. 13                  Foreman’s widow sues two contractors .............................                 11
                                                                                             General Insurance Association request increase in benefit
Indonesia                                                                                    limits under the Workmen’s Compensation Act ..................                     11
                                                                                             Fatal heart attack at work: claim upheld ...........................               11
Commercial General Liability/Public Liability/
                                                                                             Shipyard fined for death of engineer .................................             12
Products Liability
                                                                                             Worker injured in oil drum explosion .................................             12
Broken gas well causes an ecological disaster ....................                       4
                                                                                             New approach to increase workplace safety ......................                   12
Japan                                                                                        Singapore Airline settlement after plane crash ...................                 12
                                                                                             Intensified checks on forklift operations .............................            12
Commercial General Liability/Public Liability/
Products Liability                                                                           Directors’ & Officers’ Liability
Tokyo’s rush hour outage ..................................................              4   A genuine cover for honest slip-ups ................................... 13
Japan court orders government and, manufacturers to                                          Charities seek to insure directors against lawsuits .............. 13
compensate victims of tainted blood products ...................                         7   Automobile Liability
Medical Malpractice Liability                                                                Accident invalid receives SGD300,000 in damages .............                      14
Update on Creutzfeld-Jakob lawsuits .................................                    8   Faked road collisions: Income to pursue workshops ...........                      14
                                                                                             Biker’s death: Court reserves judgement ............................               14
Malaysia                                                                                     Accident victims sues motorist for USD250,000 ..................                   15
                                                                                             Fifty-nine hurt in bus-on-bus collision ................................           15
Medical Malpractice Liability
A Malaysian woman sues over false HIV diagnosis:                                             Thailand
report ...............................................................................   8
New threshold for standard of care provided by physicians                                9   Medical Malpractice Liability
                                                                                             Medical malpractice cases on the rise ................................ 10
Employment Practices Liability
American receives MYR594,267 in compensation for
wrongful dismissal ............................................................ 13
Dismissed country manager to receive MYR1.3m ............... 13
Automobile Liability
Court upholds MYR110,000 damages for rubber tapper ..... 14
Court awarded millions to magicians for
accident injuries ............................................................... 14

Medical Malpractice Liability
Those missing pieces of gauze bandage ............................                       9

Commercial General Liability/Public Liability/
Products Liability
TV Media insurer files writ against Slim 10 importer ...........                         4
Escalator-related accidents decrease ..................................                  4
FairPrice supermarket settles suit .......................................               4
Woman sues priests for botched “exorcism” ......................                         5
Fish farm sues firm for SGD1m over dead fish ....................                        5
Income sues US government to recover SGD111,000 payout                                   5
Ceiling fall down onto a family while shopping .................                         6
Fall down a theatre staircase was an accident ...................                        6
Specialist judges to save money ........................................                 6
House owner receives SGD380,000 for damage to their
house caused by Circle Line works .....................................                  6
Toddler’s big toe severed in mall escalator accident ...........                         6
Restaurant operator ordered to pay fire damage costs .......                             6

                                                                                                                                     Asian Casualty Report, June 2007 3
Commercial General Liability/                                               Tokyo’s rush hour outage
Public Liability/Product Liability                                          Japan: On 14 August 2006, the second largest blackout
                                                                            since 1987 affected Tokyo. Train services and approximately
At least six fatal casualties due to poorly sterilized                      1.4m homes were affected by a three-hour outage. No-
antibiotics                                                                 one was killed or injured. Emergency generators kept
                                                                            hospitals and stores running until power was restored.
China: Officially, six patients died and more than eighty                   The power outage also disrupted Tokyo’s vast underground
fell ill from antibiotics due to poor sterilisation. The state              and commuter train services, though on most lines the
media blamed the drug manufacturer in Anhui for                             longest stoppage only lasted for one hour.
causing the deaths of ten patients on the mainland.
                                                                                                                   Source: Straits Times, 15 August 2006

The Director of the State Food and Drug Administration
stated that the incident reflected the “chaotic situation of                TV Media insurer files writ against Slim 10 importer
the national drug market and loopholes in our supervision                   Singapore: In 2003, the High Court found Slim 10
of the pharmaceutical products market”. He announced                        importer Semon Liu and TV Media jointly and severally
measures for controlling the pharmaceutical industry.                       liable for actress Andrea De Cruz’s liver failure in 2002.
Investigations have established that Anhui Pharmaceutical                   SGD1.63m (USD1.06m) in costs and damages were
had failed to observe the approved state sterilization                      awarded to Ms. De Cruz, who could sue either or both
standards and the company and its CEO were held                             companies to secure the award.
                                                                            TV Media’s insurer was required to foot the entire bill for
In April and May 2006 eleven people died after being                        the damages and costs, since the importer did not foot
given a defective kidney drug produced by Qugihar No 2                      his share. On 7 July 2006, the insurer filed a writ, in TV
Pharmaceutical.                                                             Media’s name, seeking to recover some money from the
                       Source: South China Morning Post, 16 August 2006     importer, who was the director and main shareholder
                                                                            of the now defunct Health Biz, which imported the
Broken gas well causes an ecological disaster                               slimming pills from China. The writ has yet to be served
                                                                            on him and Health Biz.
Indonesia: An Indonesian-owned company has caused a
                                                                                                             Source: The New Paper, 14 September 2006
major pollution disaster in populous East Java. Streaming
from a breached gas well for nearly a month now, a flood
of toxic mud and gas has inundated four villages in the                     Escalator-related accidents decrease
densely populated Sidoarjo district of East Java. At least                  Singapore: In July 2006, the Straits Times reported that
two people have died, probably due to the presence                          fewer people were being injured on MRT escalators. The
of hydrogen sulphide. 600 people have suffered                              transport operator SMRT, which handles 1.13m passenger
breathlessness and dizziness and almost 5,600 people                        journeys a day on its north-south and east-west lines,
have been forced to abandon their homes.                                    said there were 112 such injuries last year, down from
                                                                            157 in 2004 and 174 in 2003.
The fact that 50,000 cubic metres of mud has been
coursing through several locations every day would                          SBS Transit, which handles about 247,000 passenger
suggest that a long section of the 3,000-metre deep                         journeys a day on the north-east line and the Sengkang
well was not protected by casing. The management of                         and Punggol LRT systems, experiences an average of one
Lapindo, a subsidiary of Energy Mega Persada, a mining,                     escalator-related accident roughly every ten days. Almost
oil and gas trading company, has been accused of                            half involve commuters aged over sixty.
negligence for failing to install adequate casing. Oil
experts have asserted that drilling in an environmentally                   In Singapore, many accidents involve the elderly, who
sensitive area with such a large population would                           lose their balance, and people carrying shopping bags.
probably have required certain safeguards to have been                                 Sources: The New Paper, 31 August 2006; Strait Times, 6 July 2006
put in place. As the operator, Lapindo appears to be liable
for all claims for compensation, including the costs of                     FairPrice supermarket settles suit
reclaiming the 130 hectares contaminated by the spill.
                                                                            Singapore: An accident occurred on 1 August 2001 while
It is stated that Lapindo will need to pay USD700 in                        a three-year-old girl and her family were standing on a
compensation to each of the 4,000 villagers and                             travelator in a supermarket.
compensation to the factories affected by the mudflow.
Business sources put the losses involved at USD100m or                      The girl, Irene, lost her balance, fell and her right hand
more in a case which may ultimately be settled in court.                    became caught in a groove on the travelator. The girl’s
                                                                            grandfather pulled her hand out, accidentally severing
                                       Source: Straits Times, 6 July 2006
                                                                            her right ring finger. Her parents sued FairPrice for

4 Gen Re
On 18 August 2006, the supermarket chain accepted                        enormous earnings potential since they can be bred for
70% of the blame in court. The exact amount of the                       up to two decades. According to fish enthusiasts, golden
award will be assessed at a later date. Since the suit was               dragon arowanas can cost between SGD500 (USD325)
filed in the magistrates’ court, the maximum amount of                   and SGD10,000 (USD6,503) each, depending on age,
damages will be SGD60,000 (USD39,023).                                   size and breed.

The supermarket’s insurer, NTUC Income, will pay the                     Lian Shing had commenced drainage operations next to
damages and costs that the court awards to the girl.                     the farm in December 2002. OTF’s premises suffered
NTUC Income initially offered to settle out of court,                    flooding during heavy downpours after Lian Shing’s
but the plaintiffs had rejected its previous “without                    operations had altered the gradient of the area, blocking
prejudice” offers and did not submit any counteroffers.                  a drain outside the farm and preventing rainwater from
                               Source: The New Paper, 31 August 2006     flowing away. Forty-two arowanas died after floodwaters
                                                                         flowed into a pond on three occasions over a seven-
Woman sues priests for botched “exorcism”                                month period. Lian Shing claims that the floodwaters
                                                                         were muddy and contained various other substances and
Singapore: A fifty-year-old woman is suing Novena                        pollutants.
Church, two priests and seven helpers, for what she
claims to be the severe side effects of a botched exorcism.              On the other hand, Lian Shing maintains that it took all
                                                                         necessary precautions to prevent water from flowing into
The exorcism, performed against her will on 10 August                    the fish farm and that there were sufficient water pumps
2004, has left her so traumatized that she now needs                     and pipes to divert water away to roadside drains. It also
twenty-four-hour care. The plaintiff, who has been                       claims that OTF had used water from an abandoned well
admitted to Changi General Hospital several times,                       and an unused pond outside the farm and that this water
was diagnosed last year as suffering from chronic post-                  could have killed the fish.
traumatic stress disorder and depression.
                                                                         OTF denies drawing water from the external pond after
Her medical expenses, amounting to more than                             drainage operations had commenced and stated that
SGD70,000 (USD45,527), plus the cost of hiring a maid                    water from the well was solely for its indoor fish tanks.
to look after her, have exhausted most of her savings. The
                                                                                          Sources: Straits Times, 18 October 2006; 16 October 2006
plaintiff is seeking damages of more than SGD250,000
(USD162,596), including for loss of earnings as a tutor
                                                                         Income sues US government to recover
and future medical expenses for long-term medication
                                                                         SGD111,000 payout
for symptoms such as insomnia and stress, and
psychiatric treatment.                                                   Singapore: On 16 July 2002, two CH-53 Sea Stallion
                                                                         heavy duty helicopters belonging to the US Navy came
The priests have denied performing an exorcism on the                    too close to each other on the ground at Paya Lebar
plaintiff. They state that together with seven helpers they              Airbase. One was flying along the tarmac to land when
had only prayed over her, in an act of deliverance, after she            it hit the other, which was stationary but had its engine
had approached them for help, saying she was possessed.                  and rotor blades running. The collision was due to
                                                                         contact between the rotor blades of the two helicopters.
Exorcism has never been officially performed in Singapore,               The resulting flying debris killed a Singaporean
at least according to a theologian from St. Francis Xavier               technician, who was about seventy-five metres away
Major Seminary. A priest would need to be specially                      inspecting an RSAF C-130 transport plane in a hangar.
appointed by the Bishop to perform an exorcism, and this
did not happen in this case.                                             The family of the deceased, an engineering services
                                 Source: Straits Times, 31 August 2006   inspector with ST Aerospace Engineering who was
                                                                         contracted to the Republic of Singapore Air Force to
Fish farm sues firm for SGD1m over dead fish                             provide services at Paya Lebar Airbase, received
                                                                         SGD111,000 (USD72,193) in workmen’s compensation
Singapore: In a lawsuit that began in the High Court in                  from NTUC Income, the insurer of ST Aerospace
October 2006, OTF Aquarium Farm in Pasir Ris Farmway                     Engineering.
3 is suing Lian Shing Construction. The construction
firm’s insurer, Liberty Insurance, is named as a third                   Now, in a rare move, NTUC Income is suing the United
party in the suit.                                                       States Government to recover its money, since it claims
                                                                         that it was pilot negligence that caused the collision. The
OTF is seeking around SGD126,000 (USD81,948) in                          pilots and/or their agents had failed to exercise proper
compensation for forty-two prized golden dragon                          safety precautions and ensure that there was a safe
arowana which it claims were killed by flooding caused                   distance between the two helicopters. The suit has been
by Lian Shing’s plant. OTF is also claiming SGD48,000                    filed in Singapore because the incident took place there.
(USD31,218) for the costs of repairs to the pond in which                The Singapore court still has the jurisdiction to hear the
the fish were being reared. In total, OTF is seeking                     suit and pronounce judgment, and if the suit succeeds
SGD1m (USD650,385) in compensation, mainly for loss                      NTUC will then need to register the Singapore judgment
of future income due to the fact that the fish entail                    in a US court in order to recover its money.
                                                                                                            Source: Straits Times, 20 October 2006

                                                                                                       Asian Casualty Report, June 2007 5
                                                                         the area also complained about hairline cracks appearing
Ceiling fall down onto a family while shopping                           in their walls after Circle Line works had commenced. In
                                                                         2004, the LTA spent SGD130,000 (USD84,550) on
Singapore: A ceiling panel approximately two square
                                                                         repairing cracks and other superficial damage to fifty-
metres in size collapsed on a father and his baby when
                                                                         eight homes in the area.
they were in a shopping centre. This collapse was
followed by a rush of water. Father and baby were not
                                                                         In August 2005, thirty-five owners and residents of a
injured. Around ten shoppers were in the area when the
                                                                         five-storey building were forced to move out because
ceiling collapsed. The cause of the accident is still unclear
                                                                         of fears of collapse due to deep excavation operations,
and under investigation.
                                                                         and the Singapore Land Authority offered shop owners
                                        Source: Today, 8 January 2007    SGD900,000 - 1m (USD 162,596 - 195,116) and home
                                                                         owners SGD250,000 - 300,000 (USD585,347 - 650,385)
Fall down a theatre staircase was an accident                            in compensation.
Singapore: A fifty-five-year-old woman fell down a flight                                                        Source: Strait Times, 17 July 2006
of stairs in a darkened esplanade at a theatre and died. It
was established that the incident had been an accident                   Toddler’s big toe severed in mall escalator accident
and that the theatre had observed the prevailing security
                                                                         Singapore: A two-year-old girl’s big toe was severed
regulations, meaning that no-one was to blame.
                                                                         during an incident on 5 November 2006. The girl was
                                                                         out with her family for dinner and when the family of six
Every step on the flight of stairs featured a luminous strip
                                                                         mounted the escalator to descend the little girl’s right
and footlights. When the Hainanese opera started the
                                                                         rubber clog became stuck in the teeth of the escalator
lights were switched off. One hour after the opera had
                                                                         step. Her father immediately freed her, only to find that
started the woman went out onto the staircase. A doctor
                                                                         her big toe, including skin from the ball of her foot, had
found her lying motionless at the bottom of the stairs.
                                                                         been severed.
She was taken to hospital and died the following day of
extensive skull fractures and loss of blood.
                                                                         A bystander had pressed the emergency stop button.
                                                                         An ambulance rushed the girl to a nearby clinic where
The coroner ruled that the footlight had provided
                                                                         her injuries were bandaged. Paramedics arrived about
sufficient light for the stairs. The floor was not slippery,
                                                                         twenty-five minutes later and she was taken to hospital.
the staircase was not too steep and a handrail was in
                                                                         However, the right toe was not found until nearly three
place on one side of the staircase.
                                                                         hours later and could not be re-attached as it was too
                                  Source: Straits Times, 27 March 2007   badly damaged. Next day, the girl underwent two hours
                                                                         of surgery to amputate the remaining toe bone and graft
Specialist judges to save money                                          skin from her thigh to her damaged foot. The big toe
Singapore: Judges will be trained to become more                         helps the body to maintain balance while walking.
specialized. The intention is to save money on legal fees
and increase productivity.                                               Experts maintain that rubber footwear becomes trapped
                                                                         more easily. The soft and pliable footwear, renowned for
This may affect medical or technical knowledge. In the                   its comfort, covers the front of the foot and has a back strap.
construction business arbitration before a panel of two
legally trained arbitrators and one technical expert is                  This is not the only incident involving such footwear. Just
preferred. Shipping cases are already heard before                       a month previously the United States media had reported
specialist judges in the High Court. It is believed that                 that there had been several escalator accidents involving
specialist judges will be able to focus on the facts of a                a popular brand of rubber footwear. In some instances
case without much preparation.                                           warnings have been posted near escalators urging those
                                                                         wearing such footwear to be careful.
                                   Source: Straits Times, 30 June 2006
                                                                                         Sources: Straits Times, 7 November 2006; 6 November 2006

House owner receives SGD380,000 for damage to
their house caused by Circle Line works                                  Restaurant operator ordered to pay fire damage
Singapore: The owners of a terrace house have received
SGD380,000 (USD247,146) in compensation from the                         Singapore: A fire started by an uncleaned exhaust duct
Land Transport Authority (LTA) because their house had                   in the kitchen of a restaurant caused damage to a
been damaged by Circle Line works. In 2004, the walls of                 neighbouring building to the tune SGD500,000
the house had started cracking and its beams and pillars                 (USD325,193). The November 2002 blaze was started by
needed to be supported by steel poles. In April 2006, the                an unattended wok of oil.
house was ordered to be vacated by the Building and
Construction Authority (BCA) because it was declared                     The Appeal Court noted that the restaurant operator had
unsafe. The compensation included reconstruction costs,                  failed to keep the duct clean, meaning that they were
the costs of hiring a professional engineer to assess the                fully responsible and required to pay the costs. The
house, legal fees and loss of income. Other residents in                 Appeal Court rejected their request for the costs to be
                                                                         split with the building owner.
                                                                                                                  Source: Strait Times, 5 July 2006

6 Gen Re
Construction Liability                                                   Professional Indemnity/
                                                                         Errors & Omissions
Burst water pipe caused flooding in a shopping
centre                                                                   Japan court orders government and, manufacturers
Singapore: In October 2006 a burst water pipe flooded                    to compensate victims of tainted blood products
the basement of Bukit Timah Shopping Centre. Tenants                     Japan: Osaka District Court awarded compensation to
are claiming compensation for damaged goods and                          nine hepatitis patients who contracted the disease from
equipment and loss of earnings due to the fact that they                 tainted blood-clotting products, mostly in the 1980s.
had been forced to keep their shops closed over the                      Four plaintiffs won compensation from the manufacturers,
weekend. They complain that the flooding could have been                 the pharmaceutical companies Mitsubishi Pharma Corp.
avoided if the building management had taken swifter                     and Benesis Corp., and five won compensation from the
action. One operator had reported a leaking pipe three                   government and the manufacturers. A court spokesman
times before the water flooded the basement of the mall.                 refused to disclose the amount, but the Kyodo news
                                                                         agency put it at JPY256m (USD2.07m). The plaintiffs
The estimated damage cost was about SGD500,000                           claimed that the government and the drug manufacturers
(USD325,193).                                                            had continued to use the medicine, called fibrinogen,
                                Source: Straits Times, 10 October 2006   despite knowing that the product was potentially
                                                                         contaminated. They also blame the government for not
Twenty unsafe scaffolding sites ordered to cease                         taking steps to regulate the tainted products, and assert
operations                                                               that the pharmaceutical companies had neglected their
                                                                         responsibility to inform to health authorities and
Singapore: After a series of intense safety checks at
                                                                         hospitals about the product risk.
construction sites and shipyards in the first half of this
year, the Ministry of Manpower (MOM) imposed 287
                                                                         More than eighty patients have also filed similar lawsuits
fines and twenty cease operations orders. About 28% of
                                                                         across the country.
infringements involved missing toe boards and guard
                                                                                                         Source: The Star Online, 21 June 2006
rails, which are vital for preventing workers from falling.
Other common scaffold-related infringements include
lack of proper maintenance and inadequate stairs and                     Gaelic Inns public house chain awarded
ladders enabling workers to ascend safely.                               SGD775,000 against auditors
                                                                         Singapore: Two former auditors of a well-known chain of
Scaffolds are temporary steel or wooden structures                       public houses have been ordered to pay SGD775,000
erected on construction sites and in shipyards for the                   (USD504,049) for failing to alert the chain’s management
purpose of accessing high and hard-to-reach places. In                   promptly to a major incidence of fraud perpetrated by
the past four years, falls from scaffolds have accounted                 the company’s former group finance manager. Between
for about one out of every ten fatal accidents both on                   March 2003 and May 2004 the manager had diverted
construction sites and in shipyards.                                     sums of money instead of banking them. The manager’s
                                                                         actions came to light when an administrative officer
MOM has inspected 198 scaffolding sites so far this year                 spotted accounting discrepancies.
– compared to forty-three in the whole of last year. One-
third of the scaffolding sites inspected in 2005 were so                 The representative of the commissioned audit firm,
unsafe that they were ordered to cease operations                        Patrick Lee Public Accounting Cooperation, had received
immediately – but this has improved to about one in                      bank reconciliation statements showing the difference
ten sites this year.                                                     between the cash balance in the accounting records and
                                                                         the actual cash in the bank. The cash in the bank was
Despite efforts to improve safety standards, lapses still                SGD672,253 (USD437,224) less than that noted in the
continue to plague construction sites which use                          accounting records. The judge ruled that the auditor
scaffolds. MOM is urging employers to do more to                         should have promptly investigated the reason for the
protect their workers.                                                   unusually long list of reconciling items and taken
                                                                         immediate action to warn the management or directors
On 24 August 2006, three workers were injured when a                     of the incidence of fraud or the irregularities which had
fifteen-metre high scaffold at VivoCity in HarbourFront                  been uncovered.
collapsed. Eleven construction workers were on the
scaffold at the time spray-painting the wall facing St.                  The ruling raises questions concerning the extent of an
James power station. One suffered a fractured right arm                  audit firm’s responsibilities and is bound to trigger alarm
and two bruising and scratches.                                          bells throughout the profession.
                                                                                                      Source: Straits Times, 20 December 2006
On 17 September 2006, a twenty-nine-year-old worker
from India died after tumbling from a mast-climbing
platform on a Tampines site where a Courts furniture
store is being built.
                             Source: Straits Times, 22 September 2006

                                                                                                     Asian Casualty Report, June 2007 7
Eighty-eight-year-old woman died after doctor                           Medical Malpractice Liability
mistakenly prescribed too high a dose of heart
                                                                        AIDS patients win landmark CNY19,23m damages
Singapore: A doctor mistakenly prescribed too high a
                                                                        China: A group of AIDS patients in China has won more
dose of heart medication, with the result that her patient
                                                                        than CNY19.23m (USD2.5m) in compensation in a
died nine weeks later. Due to the inconclusive nature of
                                                                        landmark case. These patients contracted the HIV virus
the evidence the state coroner returned an open verdict.
                                                                        from tainted blood during blood transfusions at the
The Clementi Polyclinic physician admitted that she had
                                                                        hospital in Heilongjiang Province.
prescribed a dosage which was four times that of a
normal patient’s dosage of digoxin – a medicine that
                                                                        The provincial hospital will pay CNY20m (USD2.6) in
regulates the contraction of the heart. The doctor also
                                                                        compensation to the victims and their families. This
increased the woman’s dosage of warfarin, an anti-
                                                                        includes a one-off payment of CNY200,000 (USD26,072)
coagulant that thins the blood. This increase would have
                                                                        each, plus CNY3,000 (USD391) in monthly payments, for
required a follow-up visit one or two weeks later, but the
                                                                        eighteen sufferers. The hospital will also cover the
doctor had only scheduled a check-up for more than two
                                                                        victims’ medical bills until they die. Relatives of another
months later due to the fact that the patient was old and
                                                                        victim who had already died from the infection will
not very mobile. The patient died of heart failure nine
                                                                        receive over CNY300,000 (USD39,100) from the hospital.
weeks later . Her condition had been complicated by
pneumonia and chronic kidney failure. A heart expert
                                                                        The Beijing Aizhixing Institute, a group dedicated to
informed the coroner that the excessive dose of digoxin
                                                                        helping HIV and AIDS sufferers, said the combined
might have contributed to the patient’s heart failure.
                                                                        payout was the biggest in China and followed years
                                  Source: Straits Times, 28 June 2006
                                                                        of struggle by victims across the country for adequate
Government seeks SGD1.6m over school roof
collapse                                                                In the 1990s thousands of people in China contracted
Singapore: Seven years after the collapse of a roof at                  AIDS through government-backed blood drives.
Compassvale Primary School the Government has                                                      Source: Today (Singapore), 6 December 2006
filed claims against the construction company BKB
Engineering amounting to SGD1.6m (USD1,040,617) for                     Update on Creutzfeldt-Jakob lawsuits
additional costs incurred as a result of the June 1999
                                                                        Japan: With the relatives of a male Creutzfeldt-Jakob
collapse. The accident injured seven foreign workers,
                                                                        Disease victim, who had died at the age of 39 after a
leaving one permanently disabled. The Government is
                                                                        transplant of infected dried dura mater, reaching a court-
also claiming damages for breach of contract, negligence
                                                                        mediated JPY74.8m (USD606,184) settlement, the
and/or breach of statutory duty, and costs.
                                                                        number of damage suits filed and settled in the Otsu
                                                                        District Court has risen to forty-two, meaning that all the
In 2000 BKB Engineering was fined SGD30,000
                                                                        cases before this court have been resolved. The number
(USD19,512) for its role in the collapse. It was subsequently
                                                                        of similar cases before the Tokio Court has risen to sixty-
placed under judicial management to avoid liquidation.
                                                                        five altogether, with fifty-five already settled and ten still
BKB Engineering, on the other hand, is claiming over
                                                                        ongoing. The defendants in the lawsuits are, first and
SGD 4.1m (USD2,7m) from the Government: SGD1.8m
                                                                        foremost, the Japanese Government, which approved the
(USD1,2m) for the same accident and SGD2.3m
                                                                        import, and the German pharmaceutical company which
(USD1,5m) for delay and wrongful deductions resulting
                                                                        manufactured the infected dried dura mater.
from another government-awarded school commission.
                                                                                                           Source: Daily Yomiuri, 6 March 2007
                                          Source: Today, 5 July 2006

                                                                        A Malaysian woman sues over false HIV diagnosis:
                                                                        Malaysia: A thirty-one-year-old woman went for a
                                                                        routine pre-natal check-up during her pregnancy with
                                                                        her first child in 1999. After undergoing an HIV test at a
                                                                        government hospital, she claimed that the doctor had, in
                                                                        the presence of some of other villagers, informed her that
                                                                        she was HIV-positive.

8 Gen Re
                                                                          the case here, a nurse informs a surgeon that two pieces
Another blood test established that she was free of the                   of gauze bandage are still missing the surgeon may not
virus, but in the meantime she had been ridiculed and                     flinch from informing the patient of this fact. In this case
humiliated by friends and relatives and had found it                      the surgeon had even misled the patient into believing
difficult to obtain employment. The ostracized woman                      that the pain which she was experiencing was a normal
has now won permission to sue her doctor and the                          consequence of her operation.
Government. The Malaysian Court of Appeal has ruled                                                     Source: Manila Bulletin, 7 February 2007
that she can proceed with a MYR1m (USD295,942) suit,
this after the High Court had dismissed the case in                       Dispute mediation helps both patients and
February 2004 on the grounds that she had failed to                       dentists
prove the alleged negligence.
                                                                          Singapore: The Singapore Dental Association (SDA)
                                         Source: Today, 19 October 2006
                                                                          Ethics Committee, which represents almost all the 1,300
                                                                          dentists here, has assumed an active mediation role. It
New threshold for standard of care provided by
                                                                          settled fiftyeight cases last year and has settled sixty-
                                                                          seven cases so far this year. Out of these, twenty-six were
Malaysia: In Malaysia a Federal Court decision regarding                  due to misunderstanding, fifteen involved complaints of
medical negligence may have set a new standard for the                    poor dental work and ten were for overcharging.
issue of informed consent. The claimant in the case had
developed quadriplegia after a series of operations had                   Since 2004, when the committee assumed a proactive
gone wrong. The Federal Court backed a decision of a                      role in dealing with complaints, the highest amount of
High Court declaring the hospital and the surgeon liable                  compensation it has obtained for a patient is SGD18,000
and awarding the victim MYR500,000 (USD147,971)                           (USD11,707), a case in which the dentist was clearly at
in damages. The Federal Court held that a medical                         fault. In consequence of active mediation patients avoid
practitioner is duty bound by law to inform a patient                     legal bills and dentists pay less for insurance. The process
who is capable of understanding and appreciating such                     starts with a patient making a complaint: this can be
information of the risks involved in any proposed                         done by e-mail, fax or standard letter.
treatment. According to the court medical specialists in
particular are required to meet a higher standard of care                 The insurance premiums which dentists pay to protect
than “ordinary” medical doctors.                                          themselves against charges of negligence or malpractice
                                                                          jumped by more than 20% a year in 2003 and 2004. This
The patient in the case at issue claimed that she would                   was due to a recent claim which, if settled in full, would
not have readily agreed to undergo the first operation                    have exhausted the total annual premiums which are
had she been properly warned of the risks involved. This                  paid by all dentists here.
new high standard can be seen as departing from a fifty-
year English legal principle, which is widely applied in                  Mediation eliminates legal fees. The Association is also
Malaysian cases, by virtue of which where the standard                    able to enlist the services of specialists for minimal rates,
of proof in medical negligence suits is that of a reasonable              or even free of charge. By settling the bulk of complaints
man; for example, a practitioner is in the clear if he was                against dentists here, it has curbed the rising cost of
acting in accordance with one of the prevailing bodies of                 insurance, which jumped from SGD525 (USD341) in
opinion, a standard also known as “doctor knows best”.                    2002 to SGD855 (USD556) last year. The premium this
Now, given the need for a higher standard of care, a                      year has risen by a modest 5% to SGD900 (USD585).
more appropriate phrase would be “doctor knows best if                                                    Source: Straits Times, 18 October 2006
he acts reasonably, logically and gets his facts right.” One
of the possible implications of this decision may be that                 Thinking of suing your doctor? Both parties must
doctors resort to defensive medicine, which might result                  talk first
in higher insurance premiums.
                                                                          Singapore: From January 2007 onwards, doctors and
              Sources: Bernama Daily Malaysian News, 29 December 2006;
                                    New Straits Times, 30 December 2006
                                                                          patients will be required to discuss disputes before any
                                                                          suit can be filed. This move is intended to forestall
Those missing pieces of gauze bandage                                     needless lawsuits. The new rules stipulate the necessary
                                                                          steps and timeframe, procedures which both parties are
Philippines: The Supreme Court of the Philippines has                     required to follow. Only if these procedures fail to result
ruled that a hospital and the surgeon who performed the                   in the resolution of a dispute can a patient go to court.
operation were to be held accountable for leaving two                     The aim is to reduce the number of malpractice suits
pieces of gauze bandage inside the body of a patient                      against doctors and, at the same time, ensure that those
following surgery, negligent conduct that caused the                      patients with genuine grounds for complaint will not shy
death of the patient. Although the court afforded some                    away from seeking justice because of the high legal costs
leeway to surgeons at times when a patient’s life is in                   involved.
danger, they are nevertheless required to apply
reasonable care and diligence, meaning that if, as was

                                                                                                       Asian Casualty Report, June 2007 9
                                                                        minor surgery. In accordance with the estimated amount
Malpractice lawsuits can cost between SGD200,000                        of SGD15,227 (USD9,903) the daughter had paid
(USD130,077) and SGD800,000 (USD520,308), whereas                       SGD10,000 (USD6,503) in advance and an additional
the compensation which is awarded by judges here might                  amount of SGD13,000 (USD8,455) the following week.
not even cover a plaintiff’s legal bills. The subordinate               No advice had been forthcoming on cost estimation in
courts only award a maximum of SGD250,000                               the event of possible complications. The daughter’s
(USD162,596) in civil cases.                                            lawyer argued that while, obviously, the final amount
                                                                        could deviate slightly form the initial estimation, they
Patients seeking redress have therefore been more inclined              should not be “galaxies apart”. The case is ongoing.
to turn to the Singapore Medical Council than file a civil                                              Source: Straits Times, 22 August 2006
claim. The council receives about 100 complaints against
doctors each year. In contrast, only eleven lawsuit were                Medical malpractice cases on the rise
filed at the subordinate courts last year, all of which were
settled out of court.                                                   Thailand: According to the National Health Security
                                                                        Office (NHSO) of Thailand there has been an increase in
Of the seventy-nine medical negligence suits filed in                   the maternal death rate and the number of doctor-
Singapore since 1998, only two have reached trial. A                    patient lawsuits. Given that obstetrics/ gynaecology are
2001 Singapore Medical Association study confirms this:                 the fields in which most of the lawsuits are filed (in the
the biggest problem which patients experienced at the                   years 2004 to 2006, 216 out of 371 lawsuits concerned
hands of their doctors was arrogance. Legal proceedings                 medical malpractice during child delivery), it is the
are often initiated because of miscommunication between                 maternal death rate of 19.84 per 100,000 that is
doctor and patient, or because a patient interprets a                   particularly worrying. Causes are post-partum
perceived lack of information and empathy as a lack                     haemorrhage, embolism, pregnancy-induced
of due care and attention on the part of the doctor.                    hypertension and infection, with the latter probably
                                                                        being due to the increasing number of caesarean
One caveat of these meetings, however, is that whatever                 sections. This problem is now being addressed by
is said cannot be subsequently used in evidence if a                    Thailand’s Medical Services Department, which is trying
patient still decides to sue. This is to encourage both                 to introduce measures in order to reduce the number of
parties to adopt a policy of complete honesty during                    c-section deliveries by 20-30 %. Another factor may also
discussions. If one party does not follow the rules and a               be contributing to the rise in the number of lawsuits:
lawsuit ensues, the judge can order the offending party                 over the course of the last few years patients who had
to pay costs at the end of the proceedings; the court can               formerly sought help from the Medical Council of
also suspend the lawsuit until the rules are followed.                  Thailand (MCT) have increasingly been turning to the
                                                                        courts since it has often been mooted that the MCT
The changes are expected to reduce frivolous claims,                    tends to favour the medical profession over the patients,
which, in turn, will keep medical insurance premiums                    e.g. in demanding rights of immunity for doctors against
down, since premiums have almost tripled since 2002.                    unfair complaints.
Depending on their field of practice, doctors now pay                                            Source: Thai News Service, 13 December 2006
from between SGD1,500 (USD976) to over SGD20,000
(USD13,007) each year to protect themselves against
major claims.
                              Source: Straits Times, 30 November 2006

Hospital bill ballooned from SGD15,000 to
Singapore: Who pays if a two-day stay in hospital turns
into a year-long stay and the bill, originally estimated
at SGD15,227 (USD9,903), becomes SGD560,000
(USD364,216)? This question will have to be decided in
a lawsuit pending at Singapore High Court. A simple
stent operation had gone wrong, resulting in a number
of problems and the need to perform a more invasive
bypass operation. This ultimately caused numerous
health problems, including a minor stroke, internal
bleeding and gangrene. Thus, when, after almost a year,
the patient finally returned home her daughter was held
jointly liable by the hospital for the enormous hospital
bill because she had admitted her mother to the hospital.
The Singapore Health Ministry stipulates that persons
planning to undergo hospital treatment should receive
financial advice. The patient’s daughter had been
advised, but only as to the estimated cost of the original

10 Gen Re
Workmen’s Compensation & Employers’                                     The insurance cooperative NTUC encourages workers to
Liability                                                               claim under the Act since it provides for a no-fault
                                                                        scheme, whereas under common law negligence on the
                                                                        part of the employer needs proving.
Foreman’s widow sues two contractors
Singapore: The wife of a victim of a Nicoll Highway                     Insurers believe that some lawyers are “ambulance-
accident is suing Nishimatsu, the main contractor, and                  chasing” for injured workers; sources claim that while
the victim’s employer, the sub-contractor Kori Construction,            these lawyers offer to waive legal expenses until damages
in the High Court for compensation on behalf of their                   are awarded, they do accept a sort of contingency fee
twelve-year-old son and ten-year-old daughter. The                      of 20% - 30% of the compensation which is awarded.
victim had been the construction foreman at the Circle                  This practice might be one of the reasons for the rise in
Line MRT site on Nicoll Highway. He died after a                        workmen claims which is driving this already unprofitable
temporary wall at the site collapsed, resulting in the                  insurance sector more deeply into the red.
subsidence of the highway.                                                    Sources: Straits Times, 23 January 2007; Straits Times, 20 January 2007

The Committee of Inquiry report on the incident                         Fatal heart attack at work: claim upheld
has pinned the blame on Nishimatsu, ruling that
                                                                        Singapore: In a landmark ruling in September 2006, the
Nishimatsu’s negligence led to the collapse. In January
                                                                        High Court has ruled that the family of a coach driver
2006, Nishimatsu was fined the maximum amount of
                                                                        who died of a heart attack while at work is entitled to
SGD200,000 (USD130,077) after it admitted its design
                                                                        a claim under the Workmen’s Compensation Act. On
errors had resulted in a retaining wall at the site being
                                                                        4 March 2004, the fifty-eight-year-old driver became
too weak, leading to its collapse. The widow accused
                                                                        breathless while carrying a bag to the coach and
Nishimatsu of wrongful death, asserting that Nishimatsu
                                                                        subsequently died. At the time, the Manpower Ministry
was “vicariously liable for their acts of omission” and
                                                                        took the view that no compensation was payable
that Kori Construction was also negligent. She is
                                                                        because the injury was not work-related, although he
claiming compensation to cover “funeral expenses
                                                                        had died while performing his duties.
and aggravated and punitive damages”. A pre-trial
conference has been scheduled for 18 September 2006.
                                                                        The victim’s family appealed to the Deputy Commissioner
                                                                        of Labour, who reversed the Ministry’s decision and
This is the second lawsuit concerning the Nicoll Highway
                                                                        awarded the family SGD87,360 (USD56,817) based on his
incident. The family of a forty-four-year-old crane
                                                                        average salary at the time. The insurer, NTUC Income,
operator is also suing the main contractor, Nishimatsu-
                                                                        and the employer, Asia Coach Services, appealed to the
Lum Chang, and his employer, Tiong Woon Crane, for
                                                                        High Court to overturn the award, arguing that it was
between SGD250,000 and SGD500,000 (between
                                                                        purely coincidental that the driver’s heart attack had
USD162,596 and USD325,193). This case is also pending
                                                                        happened whilst he was at work.
before the High Court.
                                                                        The Judicial Commissioner dismissed their appeal with
The families of the other two victims, a construction
                                                                        costs. The High Court upheld the decision of the Deputy
worker, thirty-seven, and the inspector of works, fifty-six,
                                                                        Commissioner of Labour that the employer cannot
had earlier accepted workmen’s compensation of more
                                                                        sidestep liability by evidencing that illness had
than SGD100,000 (USD65,038) each.
                                                                        contributed towards the death. The employer can do so
                                Source: Straits Times, 30 August 2006   only if they can demonstrate that illness had been the
                                                                        sole cause of death. Medical evidence supported the
General Insurance Association request increase                          view that the employee’s performance of his duties that
in benefit limits under the Workmen’s                                   morning had contributed towards his heart attack. It was
Compensation Act                                                        immaterial whether or not the man had over-exerted
Singapore: Rising workmen claims – especially in the                    himself or had a pre-existing condition. The Judicial
construction industry – have prompted the General                       Commissioned stated: “What is material is that
Insurance Association (GIA) to ask the Ministry of                      something in fact transpired in the course of his work
Manpower for a review of the benefit limits stipulated                  which made the injury occur when it did.’‘
under the Workmen’s Compensation Act (WCT). As                                                              Source: Straits Times, 18 September 2006
common law payouts are 50% - 100% higher and
common law also provides for compensation for pain
and suffering, more workers sue their employers for
work-related injuries instead of claiming under the WCT.
If the limits under the Act were brought into line with the
much higher common law payouts this costly litigation
could be discouraged.

                                                                                                        Asian Casualty Report, June 2007 11
Shipyard fined for death of engineer                                              The number of work-related deaths dropped slightly in
                                                                                  2006; from January to June thirty people died in work-
Singapore: On 29 June 2006, North Shipyard was fined
                                                                                  related accidents compared with thirty-five in the same
SGD4,000 (USD2,601) for failing to maintain breathing
                                                                                  period the previous year. This is true for all industries
apparatus, leading to the death of a marine engineer
                                                                                  except shipbuilding and ship repair; here the number of
who had suffocated in a tank on a barge in September
                                                                                  deaths rose eight-fold.
2005. The deceased had been assigned by his employer
to check a steel tank on a barge at North Shipyard. As the                              Sources: Straits Times, 18 August 2006; Business Times, 12 August 2006;
                                                                                                                                      Straits Times, 13 July 2006
only breathing apparatus available at the shipyard had no
oxygen, it was not possible to search for and possibly
                                                                                  Singapore Airline settlement after plane crash
rescue the engineer. North Shipyard pleaded guilty; the
maximum fine would have been SGD5,000 (USD3,252).                                 Singapore: By October 2006 – six years after a plane
                                                                                  crash at Taipei Airport in October 2000 – all fourteen
The other defendant, Marina Offshore, was accused of                              cases filed by members of the cabin crew against
not having conducted an obligatory test to guarantee                              Singapore Airlines (SIA) in the Singapore High Court had
that there was sufficient oxygen in the tank to ensure                            been settled out of court. The terms of the settlements
entry for an inspection. This constituted a breach of the                         were not disclosed; but when assessing the amount of
Factories Act. However, the Ministry of Manpower later                            damages courts take into consideration the following
dropped the charge. No reason was given for the charge                            factors: the nature of the injury sustained, whether or
being dropped, but it is speculated that it was unclear                           not long-term treatment is needed, the plaintiff’s last
whether or not a vessel could legally be defined as a                             salary and the number of dependants.
       Sources: Straits Times, 15 September 2006; Straits Times, 30 June 2006     The accident happened when the plane crashed into
                                                                                  construction equipment on a closed runway and caught
Worker injured in oil drum explosion                                              fire. Thirty-eight of the 179 people on board were killed.

Singapore: A metal worker at the Sin Min Road metal                               Several members of the cabin crew had sued SIA in the
workshop suffered severe head injuries when the lid of                            United States, but the US court decided Singapore was
an oil drum blew off. He later died in hospital. It was                           a more appropriate venue. All the passenger lawsuits
reported that the man had been earning some extra                                 – twenty-six in Singapore and more than sixty in the US –
money by cutting the bases off oil drums with a blow                              were also settled out of court.
torch and selling them as bins for burning incense paper.
These drums had been used to store and transport waste                            Investigations into the cause of the accident came to
oil. Blow-torch operations on such drums are extremely                            different conclusions, such as pilot error, construction,
dangerous since they can contain potentially                                      lighting and the control tower.
inflammable vapours even when empty.
                                                                                              Sources: New Paper, 18 October 2006; Straits Times, 29 July 2006
            Sources: Straits Times, 18 August 2006; Straits Times, 28 June 2006

                                                                                  Intensified checks on forklift operations
New approach to increase workplace safety
                                                                                  Singapore: Following an increasing number of
Singapore: In March 2005, the Government announced                                workplace accidents involving forklifts, the Ministry of
that it intended to reduce the number of workplace                                Manpower (MOM) has intensified checks on forklift
deaths by half within the next decade. In order to do this,                       operations and worksites involving confined spaces,
many new measures have been initiated, such as                                    such as shipyards where welding operations are
requiring all building contractors to be licensed and                             performed in vessel cabins.
establishing a hotline for anonymous complaints relating
to unsafe worksites. Furthermore, on 1 March 2006, the                            Investigations showed that with regard to some of the
new Workplace Safety and Health Act came into effect,                             forklift accidents companies had been using unqualified
which places the onus of safety on owners, developers,                            operators, this despite the fact that since 2001 it has
contractors and engineers as well as on workers. The                              been stipulated by law that forklifts must only be
maximum fine for an offending company was more than                               operated by people who have passed a training course at
doubled from SGD200,000 to SGD500,000 (USD130,077                                 an MOM-approved school. In addition, the Workplace
to USD325,193).                                                                   Safety and Health Advisory Committee released a
                                                                                  checklist to help companies ensure that the brakes of
According to the Director of the National Trade Union                             forklift trucks function properly and that the machines
Congress, employers do nothing to assess the dangers to                           are well maintained.
which workers are exposed. In 2005, seventy-one
                                                                                                                               Source: Straits Times, 4 July 2006
workers were killed on site and SGD68.5m (USD44,5m)
was paid out in workers’ compensation as a result of

12 Gen Re
Directors’ & Officers’ Liability                                               Employment Practices Liability

A genuine cover for honest slip-ups                                            Sacked pilots file suit against Cathay
Singapore: In September 2006, Fortis Private Banking                           Hong Kong: Two pilots who were sacked by Cathay
organized a talk on a directors’ and officers’ (D&O)                           Pacific along with forty-nine others in July 2001 are suing
policy for voluntary welfare organization (VWO)                                the airline for breach of contract and defamation. The
representatives. D&O insurance was first introduced in                         claimants were employed through a Cathay subsidiary,
Asia in 1986. The representatives were informed that                           US Basing. The writ follows a ruling issued by the UK’s
D&O insurance protects individuals against personal                            House of Lords in January 2006 that one of the sacked
liability and financial loss arising out of wrongful acts                      pilots could seek compensation for unfair dismissal under
– actual or alleged. These can include negligence,                             English employment legislation. The pilots, who had
misrepresentation or errors that cause financial loss to a                     participated in the actions of the Hong Kong Aircrew
third party. D&O is only provided for genuine mistakes                         Officers’ Association, claim that Cathay had breached
and does not cover intentional wrongdoing or criminal                          part of the Employment Ordinance protecting workers
acts, such as fraud or insider trading. D&O also excludes                      against being sacked for being active members of a
personal misconduct related to the acceptance of                               union. On 20 June 2001, union members had resolved to
improper profits, payments and benefits. However, it                           take industrial action, and on 3 July the Association
was noted that D&O insurance is not a substitute for                           instituted what it called the Maximum Safety Strategy,
good corporate governance and may have the potential                           basically a work-to-rule regime. On 9 July 2001 the fifty-
to breed complacency among directors and officers.                             one pilots were summarily dismissed.
                                        Source: Today, 20 September 2006                           Source: South China Morning Post, 15 February 2006

Charities seek to insure directors against lawsuits                            American receives MYR594,267 in compensation
                                                                               for wrongful dismissal
Singapore: The Singapore Anti-Tuberculosis Association
(Sata) recently insured its eighteen board members                             Malaysia: An American who was wrongly dismissed by
against lawsuits. All board members serve voluntarily                          Lilly Industries Sdn. Bhd. in 2000 has been awarded
without any financial reward. Following the National                           compensation of MYR594,267 (USD175,869). A local
Kidney Foundation (NKF) scandal, in which the former                           industrial court awarded this amount to the former
NKF CEO and three former board members were sued                               manager of the company’s Wood Pro Division after ruling
for a host of questionable practices, awareness of their                       that his dismissal had been without just cause or reason.
exposure to legal responsibilities and liabilities has risen                   The court judged that the selection of the manager for
amongst the volunteers of non-profit organizations.                            redundancy and the manner in which it had transpired
                                                                               had been unfair, adding that the company could have
Many other larger charities are now looking to purchase                        deployed him in other capacities since he had previously
D&O insurance policies in order to cover their directors                       been employed in various divisions of the company.
against claims and legal expenses. As it is difficult for                                                     Source: Xinhua News Agency, 5 July 2006
charities to find suitable individuals who are willing to
volunteer as board members, they at least want to give                         Dismissed country manager to receive MYR1.3m
them the assurance that they enjoy some protection. The
cover will not indemnify board members for any actual                          Malaysia: A former Malaysia country manager of Coca-
wrongdoing. In Singapore there are said to be few                              Cola Far East Ltd (CCFE) has been awarded in excess of
insurers which underwrite such specialty insurance,                            MYR1.3m (USD384,725) in back pay and compensation
which can only be purchased by a non-profit organization                       for wrongful dismissal eight years ago. The Industrial
on behalf of its entire board.                                                 Court Chairman, Franklin Goonting, ordered the
                                                                               company to pay the sum by 14 October 2006.
                   Sources: Straits Times, 14 July 2006; Today, 11 July 2006

                                                                               CCFE had relieved the manager of his duties without
                                                                               stating any reason. CCFE had subsequently cancelled his
                                                                               work permit, leaving him stranded with only a tourist
                                                                               visa, and his family was required to leave the country.
                                                                               They were subsequently forced to exist on their savings
                                                                               and the ensuing financial and emotional stress had led to
                                                                               their separation.

                                                                               Goonting concluded that a series of breaches had
                                                                               occurred and that the cumulative effect of these breaches
                                                                               constituted clearly demonstrated that the company
                                                                               (CCFE) had no longer intended being bound by the
                                                                               manager’s contract of employment. This the claimant
                                                                               was entitled to interpret as constructive dismissal.

                                                                                                           Asian Casualty Report, June 2007 13
The plaintiff received twenty-four months’ back pay and                  Accident invalid receives SGD300,000 in damages
fourteen months’ salary as compensation in lieu of
                                                                         Singapore: A motorcycle accident on 21 July 2002 left a
reinstatement for the years of service which he had
                                                                         woman, then twenty-four, with permanent epilepsy. She
rendered. Prior to his dismissal he had been earning
                                                                         was flung off the back of a motorcycle when the rider,
MYR34,679.65 (USD10,263) per month. His claim for a
                                                                         who was travelling at an “excessive speed”, lost control
bumper sum of MYR72.5m (USD21.4m), including loss
                                                                         of the machine. The plaintiff suffered skull fractures and
of earnings up to the age of sixtyfive, retirement plan
                                                                         brain damage.
benefits and stock options, was dismissed.
                                     Source: Today, 19 September 2006    In August 2006, the High Court awarded Ms. Norhayati
                                                                         nearly SGD300,000 (USD195,116) in damages against
Automobile Liability                                                     the rider of the motorcyclist, a friend of hers, for
Court upholds MYR110,000 damages for rubber                                                              Source: Straits Times, 30 August 2006
                                                                         Faked road collisions: Income to pursue workshops
Malaysia: On 12 September 2006, the Court of Appeal
upheld the MYR109,340 (USD32,558) damages which                          Singapore: Insurer NTUC Income is pursuing at least
had been awarded to a motorcyclist who was disabled in                   fifteen motor workshops which it believes have cheated
both hands following an accident involving his                           the company out of USD1m on the basis of fraudulent
motorcycle and a bus in 1988.                                            claims. This decision has been reached following
                                                                         Income’s legal victory in March over a bus driver who
In October 2000, the Sessions Court ordered Len Seng                     was found guilty by a court of having staged several
Omnibus Co. Bhd. to pay general and special damages                      accidents with the aim of helping third parties fleece the
totalling MYR97,590 (USD28,881) after ruling that the                    insurer.
bus company had been 100% responsible for the
accident. In October 2003, the High Court allowed the                    The court ruled that the eight accidents in which the bus
claimant’s appeal and increased the general damages for                  driver had been involved were so similar that they could
injuries to his right hand to MYR30,000 (USD8,878) from                  hardly be coincidental, and concluded that his conduct
MYR20,000 (USD5,918) and the special damages for                         had been “undoubtedly fraudulent”.
actual loss of earnings to MYR4,200 (USD1,243) from
MYR2,450 (USD725).                                                       The man, thirty-nine, had suddenly became accident-
                                                                         prone after twenty years with a spotless driving record.
However, the High Court upheld the award of                              Following all the accidents, the ‘wronged’ motorists had
MYR20,000 in general damages for injuries to his left                    lodged third-party claims against Income, which insured
hand, MYR5,000 (USD1,479) for scars, MYR42,000                           the vehicles of the bus driver’s various employers. The
(USD12,429) in special damages for loss of livelihood,                   workshops that undertook the repairs then claimed from
MYR1,140 (USD337) for transport costs and MYR7,000                       Income.
(USD2,071) for the cost of a right elbow replacement.
                                                                         Income’s civil case had initially been dismissed by a
The appeal by Len Seng Omnibus Co. Bhd. against the                      magistrate’s court but, undeterred, the company took its
High Court’s award was dismissed unanimously.                            case to the High Court on appeal, eventually becoming
              Source: Bernama Daily Malaysian News, 12 September 2006
                                                                         the first insurance company to win such a case in a civil
                                                                         court. The company believes that one in five of the third-
Court awarded millions to magicians for accident                         party property damage claims which it received last year
injuries                                                                 was fraudulent and that many third-party claims are
                                                                         inflated by repair workshops.
Malaysia: The Sessions Court in Kuantan awarded
                                                                                                        Source: Straits Times , 12 October 2006
MYR8.75m (USD2.59m), one of the highest amounts
every awarded for an accident claim in the history of the
                                                                         Biker’s death: Court reserves judgement
country, to an American magician couple for injuries
which they had suffered in a road accident in 1998. A                    Singapore: The Court of Appeal has reserved judgement
truck had collided with a taxi in which the couple had                   until a later date in an unusual case in which the two
been travelling. The Sessions Court ruled that the truck                 main witnesses are dead. The Court is faced with the
driver, who had collided with the taxi, and his employer                 difficult task of deciding whether a motorcyclist killed in
were liable for the accident. Due to limb injuries the                   a road accident had contributed to his own death.
couple can no longer perform their act.
                       Source: Associated Press Newswires, 20 May 2006
                                                                         The accident took place in 2002 when the fifty-six-year-
                                                                         old managing director of the Singapore office of a
                                                                         multinational firm, who was riding his motorcycle along
                                                                         Clementi Road, collided with a double-decker SBS bus.

14 Gen Re
The bus driver, then fifty-eight, was making a right turn              Environmental Liability
from Commonwealth Avenue West. The motorcyclist
died on the spot. The traffic lights were on green in the
motorcyclist’s favour, whereas for the bus driver an arrow
                                                                       Over 2,000 feared to have lead poisoning in China
was indicating no right turn.                                          China: Over 2,000 villagers of Hui County in Gansu
                                                                       Province fear that they may have lead poisoning. Many
The bus driver was fined USD10,000 after he pleaded                    (including over 300 children) found that the level of lead
guilty to having negligently caused the motorcyclist’s                 in their blood is several times greater than the safe level.
death, though he has since died. The widow of the                      In August 2006, the Hui County authorities ordered the
motorcyclist sued SBS Transit for damages in 2004, and                 local smelting factory to close and move to a safer
in May 2006 the High Court ruled in her favour. The                    location. China News Services had earlier reported that
amount will be assessed at a later date, but it is                     the smelting plant had been pumping out polluted
understood that she is seeking close to USD3m.                         waste water and emitting dark fumes and thick clouds
                                                                       of dust.
However, SBS Transit appealed, arguing that the
motorcyclist should be held “contributory negligent”                   Lead poisoning can have a variety of adverse effects, from
for the accident.                                                      nausea and insomnia to comas and impaired mental
                              Source: Straits Times, 12 October 2006   development in children.
                                                                               Source: Agence France-Presse English Wire, Beijing, 6 September 2006
Accident victim sues motorist for USD250,000
Singapore: A woman, forty-nine, is suing a motorist for
damages of more than USD250,000 following a collision
which took place in 2004. The claimant, who was in the
front passenger seat, suffered skull and spinal fractures
after the car in which she was travelling was hit by the
defendant’s car at a T-junction. She is no longer able to
work and has developed eye disorders. The car in which
the claimant was travelling was being driven by her
daughter, who asserts that the lights were on green in
her favour and that it was when she started turning into
a slip road that the defendant’s car collided with hers.

In March 2004 the defendant had been fined USD2,800
after admitting to ignoring a red light. However, during
the civil court hearing he claimed that he had pleaded
guilty because he was cash-strapped. A traffic police
officer had allegedly told him that he would only be
facing a maximum fine of USD3,000 if he did so. In
addition, the defendant told the court that if he wished
to contest the case he would need to hire a lawyer, which
could cost him up to USD10,000. The defendant now
claims that it is due to these factors that he had pleaded
guilty to dangerous driving.
                              Source: Straits Times, 19 January 2007

Fifty-nine hurt in bus-on-bus collision
Singapore: On 10 August 2006, a bus full of workers
crashed into another bus picking up workers outside the
Lakeside MRT station. Fifty-nine people were hurt. The
stationary bus had been parked alongside the alighting
bay outside the MRT station when it was hit from behind
by the bus carrying the workers.
                               Source: Straits Times, 11 August 2006

                                                                                                       Asian Casualty Report, June 2007 15
Gen Re Directory
Financial Centre             San Francisco                    Riga
695 East Main Street         Tel. +1 415 781 1700             Tel. +371 783 0107
Stamford, CT 06901, USA
                             Seattle                          Vienna
Tel. +1 203 328 5000
                             Tel. +1 206 682 7386             Tel. +43 1 536 860
Theodor-Heuss-Ring 11
                             St. Paul
50668 Cologne, Germany                                        Africa
                             Tel. +1 651 293 0075
Tel. +49 221 9738 0                                           Cape Town
                             Toronto                          Tel. +27 21 412 7700
                             Tel. +1 416 869 0490
U.S./Canada                  Latin America                    Tel. +27 11 684 0300
                             Buenos Aires
Tel. +1 404 237 2555                                          Australia/
                             Tel. +54 11 4114 7000
                                                              New Zealand
                             Mexico City                      Auckland
Tel. +1 617 728 3800
                             Tel. +52 55 9171 9200            Tel. +64 9 309 3638
Tel. +1 704 556 0910         Europe/Middle East
                                                              Tel. +61 3 9628 4000
                             Tel. +961 1 999 888              Sydney
Tel. +1 312 207 5300
                                                              Tel. +61 2 8236 6100
                             Tel. +45 33 33 7878
Tel. +1 614 221 7111                                          Asia
                             Dublin                           Beijing
                             Tel. +353 1 673 8500             Tel. +86 10 6517 1255
Tel. +1 214 691 3000
                             London                           Hong Kong
                             Tel. +44 (0) 20 7426 6000        Tel. +852 2598 2388
Tel. +1 860 547 0200
                             Madrid                           Seoul
Kansas City
                             Tel. +34 91 308 3712             Tel. +82 2 750 8500
Tel. +1 913 345 2011
                             Manchester                       Shanghai
Los Angeles
                             Tel. +44 (0) 161 831 7555        Tel. +86 21 6100 6300
Tel. +1 213 630 1900
                             Milan                            Singapore
                             Tel. +39 02 762 1181             Tel. +65 6438 7990
Tel. +1 514 288 9667
                             Moscow                           Taipei
New York
                             Tel. +7 495 589 1189             Tel. +886 2 8733 1252
Tel. +1 212 341 8000
                             Paris                            Tokyo
                             Tel. +33 1 5367 7676             Tel. +81 3 3663 7447
Tel. +1 215 988 7100

Cologne Reinsurance Company plc.                                                      For additional information please contact:
Singapore Branch                                                                      Global Casualty Facultative (Singapore)
9 Raffles Place                                                                       Yanbin Chen, Tel. +65 6438 7636,
#24-01 Republic Plaza                                                                 Collin Sim, Tel. +65 6438 7632,
Singapore 048619                                                                      Inoon Nasir, Tel. +65 6438 7631,
Tel. +65 6438 7990                                                                    Nana Lech, Tel. +65 6438 7630,
Fax +65 6532 5838                                                                         This information was compiled by Gen Re and is intended to provide background
                                                                                      information to our clients, as well as to our professional staff. The information
Foto: © Mauritius Images/Brand X Pictures                                             is time sensitive and may need to be revised and updated periodically. It is not
                                                                                      intended to be legal advice. You should consult with your own legal counsel
© Kölnische Rückversicherungs-Gesellschaft AG, Cologne 2007                           before relying on it.

To top