On 24 August 2022, the Court of Appeal reversed the High Court’s decision in Zainor Hisham Ahmad (sebagai bapa yang sah dan penanggungan kepada Mohd Zaziwan Hisham, si mati, untuk diri sendiri) & Anor v. Norhafizah binti Samad & Anor (2020) MLJU 1083 that allowed dependents to claim for the loss of EPF contributions of the deceased’s employers.
The Court of Appeal agreed with the Sessions Court Judge’s decision on 16 October 2018 that the dependant is not entitled to claim for the statutory contributions made by the deceased’s employer as part of the Plaintiff’s claim for dependency.
How did the High Court Judge err in law?
The damages therein, among other things was for loss of the support occasioned to the Plaintiff due to the deceased’s death. The proviso expressly excludes from a dependency claim any sum payable, as a result of death, under any law relating to the deceased’s EPF.
However, the Judicial Commissioner did not draw a distinction between section 7(3)(i)(b) and section 28A(1) which provides as follows:
As a result, the judgment in allowing EPF contributions of the employer to be claimed did not take into account that in section 28A(1) consideration of the lost EPF contributions was not precluded. This was contrary to the provisions in section 7(3)(1)(b).
In essence, the reliance by the Judicial Commissioner on the precedent of Lau Kung Khai v Abu Serah Bal [2008] 10 CLJ 245 which concerned a dependency claim to allow the claim for EPF contributions in the case at hand was wrong. This was as the decision in Lau (supra) was derived by referring to the earlier case of Noor Azahar Habih v Rajaswari Sithampara Pillai & Anor [1991] 1 CLJ 156 which was a personal injury matter. In the latter case, the Plaintiff become paraplegic and could no longer earn his previous wages. The Court in Noor Azahar opined that as the Plaintiff was out of a job as a result of his severe injuries, he would be deprived of the EPF contributions of his employer. In return, this would materially affect the amount which he is entitled to in the fund when he turns 55.
Hence, the Judicial Commissioner’s failure to specifically address the limits of the award by referring to section 7(3) instead of section 28A(1) occasioned a miscarriage of justice. The Judicial Commissioner’s misconception in this regard was clearly captured in paragraph [12] where it was held that it did not matter which provisions were related to the claim for dependency:
“[12] The Defendants submitted that the Judge in the case of Noor Azahar had distinguished between a dependency claim and a non-dependency claim. However, I am of the view that this argument is untenable, and that regardless whether it is a dependency claim or a non-dependency claim, loss of EPF contributions is claimable. ”
It is trite that the Courts here are not abhorrent by principles established in foreign jurisdictions. However, despite there being no submissions on the matter from this aspect by either party, the Judicial Commissioner had relied the Singaporean cases of Zhang Xiao Ling (personal representative of the Estate of Chan Tak Man, deceased) v Er Swee Poo and Another [2004] SGHG 21 and the case of Gul Chandiram Mahtani v Chain Singh [1999] 1 SLR 154.
The learned Commissioner erred in law as the provision in Singapore were not pari materia with those applied in Malaysia. While section 12 of the Singaporean Civil Law Act allowed a court of law to award damages for anticipated Central Provident Fund (CPF) savings, the same had not been provided in Malaysia.
The Civil Law Act 1956 which governed the claim for dependency in this case was merely for compensation for any loss of support that person has to suffered as a result of the deceased’s death.
In determining whether EPF contributions of the employer was claimable in a dependency claim under section 7(3) of the Act, the High Court erred by applying the test of reasonableness of the dependents expectations as compared to just the monetary loss of upkeep of life as provided under the section.
Under section 12 of the Singaporean Civil Law Act pre its 1987 Amendments, a claim brought by a dependant would be assessed based on whether there was a ‘reasonable expectation by the dependent of withdrawing and benefitting from the funds of the deceased’. The provisions stated as follows:
The section allowed the Court to award damages which it thought to be fit, that is by taking into account the expectations of the dependant of receiving a pecuniary benefit from the deceased’s funds upon cessation of contribution by the deceased. Although the case of Gul Chandiram (supra) was decided after the amendments, which removed the words ‘as it thinks fit,’ the Court there nevertheless considered the pre-amendment position. Consequently, it held nevertheless that the award could not be made as it was unlikely that it could be inherited by the dependant even if the deceased did withdraw that money upon cessation of contributions as the dependent was too young and the funds would have likely been used by the deceased during his lifetime.
In paragraph [16] the Judge reasoned that it would be unfair to deprive the dependants of funds they would have expected to benefit from if the deceased had been able to withdraw those funds. Applying the reasonable expectation of pecuniary benefit test however would be ultra vives the legislation in Malaysia.
In summary, the decision of the High Court was erroneous and was unsustainable as the Act was misinterpreted and wrongly applied. The damages ought to have been only limited to the loss occasioned to the dependent from not receiving what the deceased actually contributed as a means of living to his dependent based upon the conform and station of life the dependant was maintaining. Apart from the damages fo loss of support, there was no provision in a dependency claim to allow a separate award to be made solely for loss of EPF contributions to complement the damages awarded under section 7(3).
The Court of Appeal decision, although unreported is hoped to have provided some finality to the matter.
