Limitation Act does not apply to beneficiaries of insurance policies

It is an established principle of law that any claim should be made within the period prescribed under the Limitation Act. For contract and tort claims, the limitation period is 6 years. This means if a claim is made after 6 years, the person sued can in fact go to Court and say, "Yes, I am wrong as alleged, but so what? You cannot sue me!"

In the recent Court of Appeal decision of Anthony Kulanthai Marie Joseph v Malaysian Assurance Alliance Bhd [2008] 4 CLJ 205, the Court of Appeal was faced with the dilemma of a beneficiary under an insurance policy who claimed for the insurance monies after the expiry of more than 6 years of her husband's demise. The High Court earlier had dismissed the wife's claim on the basis that limitation has set in.

The Court of Appeal did justice in this case by declaring the wife as a beneficiary under trust, and declared the insurance company as a bare trustee. In this way, limitation periods prescribed under the Limitation Act would not apply, and therefore the wife is free to claim for the money without regard to delay in time.

The Court of Appeal should be applauded for this decision, as clearly if an insurance company has accepted premiums for a life insurance policy, it should not be permitted to rely on technicalities to deny any legitimate claim.

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Despite its shortcomings, I continue to keep faith in the Malaysian judiciary. E-mail me at khenghoe@mycounsel.com.my.