Illegality And Attribution

On 18 January 2023, the Court of Appeal upheld the High Court's decision allowing a takaful operator's claim against loss adjusters appointed by the operator for breach of contract. The loss adjusters contended that the takaful operator could not recover damages for breach of contract because it was bound by the illegal acts of its own employee. JJNN acted for the takaful operator.

The arguments at the High Court and the Court of Appeal centered on whether the illegal "contract" between the takaful operator's employee and the loss adjusters' employee had "tainted" the contract between the insurer and the loss adjuster with illegality, resulting in the contract being illegal, void, and unenforceable. In this regard, the concepts of vicarious liability, illegality, attribution, and agency were canvassed before the Court.