Haidar Mohd Noor JCA:

[1] Chan Yoke Lain, as administrator of the estate of Chong Yoke Fah, deceased, (appellant), filed an action against Pacific & Orient Insurance Co Sdn Bhd (respondent) for a sum of RM440,000 under the personal accident policy ('PA policy') issued by the respondent company to the deceased. In addition thereto, there is a claim for RM508 for costs of Letters of Administration and other disbursements and costs of the proceedings.

[2] The learned judge, after a full hearing, dismissed the action with costs. Hence this appeal before us.

Brief Facts

[3] The appellant was the wife of the deceased at the material time though she has since remarried.

[4] The respondent company issued two insurance policies at the material time prior to the deceased's death, namely:

(a) a comprehensive motor insurance policy for the deceased's Honda motor car No WCN 9012.

(b) a PA policy for RM440,000 in the event of death.

[5] Upon the deceased's death on 27 November 1992 as a result of a motor accident whilst driving his motor car No WCN 9012, the estate was paid RM15,957 on the motor insurance policy by the respondent company.

[6] In respect of the claim on the PA policy for RM440,000, the respondent company repudiated liability on the sole ground that the signature of the deceased which appeared on the proposal form ('D2') was not that of the deceased. It was alleged to be a forged signature of the deceased.

Issue

[7] The only issue is whether (even assuming the signature on the proposal form of the PA policy was not that of the deceased) after the deceased had ratified the proposal by having the premium paid to David Lim Risk Management Sdn Bhd the authorised agent of the respondent company which subsequently issued the PA policy, can the respondent company repudiate liability?

[8] The learned judge, after concluding that the deceased did not sign on D2, proceeded to consider at length the legal consequence.

[9] His consideration is grounded as follows:

(a) there was no offer by the insured (deceased) since he did not sign on the proposal form (D2) and therefore there can be no acceptance by the insurer (respondent company) and when there is no acceptance, there can be no contract. Any contract purported to be created will be void ab initio;

(b) the parties are not really in consensus ad idem;

(c) mistake, citing s 21 of the Contracts Act 1950.

[10] At the hearing of the appeal, counsel for both parties agreed that mistake was not pleaded (see p 30(A) of the Appeal Record). It was also agreed that the issue of mistake was also not submitted to the learned judge (see pp 18 to 120 of the Appeal Record regarding written submissions). We would therefore leave out the issue of mistake from our consideration. In any event it is not a relevant issue in so far as it concerned our decision for allowing the appeal.

[11] Interestingly enough, the learned judge in considering the issue of offer and acceptance, answered in the negative the question - can it be said that the offer to insure is moved by the proposer? Apparently the negative answer was arrived at on the basis of what he perceived to be that no agency was raised. This is what he said in his judgment (p 23 of the Appeal Record):

... (barring any inferences of agency which is never raised in this case)...

[12] Obviously the learned judge was wrong as para 4 of the statement of claim under the heading "particulars of Personal Accident Insurance" the cover note No A0097177 was issued by the respondent company's agent, David Lim Risk Management Sdn Bhd Arising from the issuance of the cover note by its agent, the PA policy no 0286920A 000021 was issued by the respondent company on 10 August 1992 for the period 11 July 1992 to 10 July 1993. Therefore at the time of the death of the insured, the PA policy was in force. It is not disputed that the insured died as a result of a motor accident involving his car No WCN 9012 covered by the insurance policies issued by the respondent company.

[13] It i