JUDGMENT

Hanipah Farikullah JC:

(1) The first plaintiff is the lawful wife of Heng Chong Teck, deceased and the first plaintiff and the second plaintiff are the joint administrators of the estate of Heng Chong Teck, the deceased. The first defendant is a licensed financial institution. The second defendant is a licensed insurance company. The plaintiffs claim against the defendants for damages suffered as a result of breach of insurance policy No. 11518 under Master Policy No. EGS 10148 by the defendants. The defendants refused to pay on the grounds that there was a material non-disclosure and the plaintiffs had fraudulently failed to disclosure a material fact that he was suffering from diabetes.

Background Facts

(2) On 30 December 2006 the first plaintiffs husband (the deceased) died of ischemic heart disease. The plaintiffs furnished proof of the death of the deceased and requested the said sum of RM367,961, but the defendants repudiated liability on the ground of non-disclosure of a material fact by the deceased in the MRTA Policy form dated 28 July 2003. The plaintiff sued the defendants for the said sum being the insured amount for the housing loan and interest thereon.

The Plaintiffs Case

(3) The first plaintiff, Tan Mooi Sim (PW1) testified that on 28 July 2003, the deceased and her attended to the office of the first defendant for the purpose of applying for a housing loan to finance the purchase of one unit of two storey terrace house. The deceased and PW1 were informed by the Wong May Cy (DW1), a Personal Banking @ Officer of the first defendant that they were required to purchase an MRTA Policy to cover the life of the deceased so that in the event the deceased pass away during the period of the housing loan, the housing loan will be paid by the insurance company. Subsequently PW1 said that the deceased was given a blank MRTA Policy form by DW1 and the deceased signed the blank form as he could not read and write in English. PW1 informed the court that DW1 did not go through and explain in detail the contents of the MRTA form to the deceased before he signed the blank form.

(4) According to PW1, vide a letter dated 7 November 2003, the second defendant informed the deceased that his application in respect of the MRTA Policy for the amount of RM367,961 had been approved and effective on 20 November 2003.

(5) It is an agreed fact that on 30 December 2006, almost three years after the MRTA Policy was taken, the deceased died of ischemic heart disease while playing volleyball. The plaintiffs furnished proof of the death of the deceased and requested the sum of RM367,961 from the second defendant but vide a letter dated 11 December 2007, the second defendant repudiated liability on the ground that the deceased failed to disclose material facts in the proposal form in respect of the deceased health condition that he was suffering from diabetes since 2002.

(6) Hence the plaintiffs commence this action against the first defendant as agent of the second defendant for negligence in failing to explain to the deceased the contents of the MRTA Policy form before the deceased signed it on 28 July 2003 when DW1 knew that the deceased cannot read, write or speak in English and against the second defendant for failing to pay the insured sum of RM343,676 together with interest and costs.

First Defendants Case

(7) The first defendant denies being negligent as alleged by the plaintiffs or if at all the first defendant owed a duty of care to the deceased, the first defendant states that it has fulfilled that duty by ensuring that the deceased understood the contents of the application form for the MRTA Policy and by completing the said application form in accordance with the answers and information provided by the deceased.

(8) It is the defendants case that DW1 assisted the deceased in the said application for the MRTA Policy, read out to the deceased the "Health Declaration" appearing in the MRTA Policy application form