Carney v Australian Super Pty Ltd

IN THE COUNTY COURT OF VICTORIA

Revised

Not Restricted

AT WARRNAMBOOL

CIVIL DIVISION

Case No. CI-07-03594

PATRICK KEVIN CARNEY	Plaintiff
(AS EXECUTOR OF THE ESTATE OF VERONICA CARNEY)
v
AUSTRALIAN SUPER PTY LTD	Defendant

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JUDGE:	HIS HONOUR JUDGE BOWMAN
WHERE HELD:	Warrnambool
DATE OF HEARING:	17 & 18 May 2010
DATE OF JUDGMENT:	10 June 2010
CASE MAY BE CITED AS:	Carney v Australian Super Pty Ltd
MEDIUM NEUTRAL CITATION:	[2010] VCC 0583

REASONS FOR JUDGMENT

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Catchwords: Total and permanent disablement – superannuation insurance policy – whether deceased fell within the definition contained in policy and in trust deed – surgery performed on deceased after a diagnosis of breast cancer – deceased continued on restricted duties until date of retrenchment – whether deceased employed in a made-up job – whether disablement causally linked to retrenchment – whether reasonable trustee could have arrived at the decision to reject claim – consideration of available material – factors to be considered.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr D Brookes SC with	Maddens Lawyers
Mr N Bird
For the Defendant	Ms P Neskovcin	Holding Redlich
HIS HONOUR:

Background
1          This matter comes before me by way of a Writ dated 11 September 2007 and an Amended Statement of Claim attached thereto. The plaintiff, being the Executor of the Estate of the late Veronica Carney, his wife (“Mrs Carney”), is essentially challenging the effectiveness of a decision by the defendant to refuse a claim for superannuation benefits payable in the event of Mrs Carney becoming totally and permanently disabled within the meaning of a trust deed, which in turn takes one to a definition contained in a policy of insurance. The defendant is the trustee of the fund involved.
2          In fact the defendant took a number of decisions, the first three being dated 24 November 1994, 24 October 1995, 20 February 1996. These three claims were made during Mrs Carney’s lifetime. She died on 7 April 2005. The fourth claim, brought by the plaintiff, was made essentially by way of letter dated 1 May 2006 and 16 May 2006 from the plaintiff’s solicitors. This claim was reconsidered on a number of occasions and following the supplying of further material by the plaintiff. The ultimate decision in relation to the fourth claim was made on 28 April 2010. It was essentially agreed that the material presented to the defendant on the prior occasions was again before them at the time of the making of this ultimate decision, together with additional material. Thus, the earlier three decisions have been overtaken by events and it is the fourth decision that is the subject of this dispute. The earlier decisions are part of the background or history of the matter and also have the potential to be relevant in relation to the form of relief to be granted should the plaintiff be successful. The sequence of events shall be discussed at greater length when the submissions made on behalf of the defendant are summarised.
3          The contention on the part of the plaintiff was to the effect that no reasonable trustee could have come to the decision in question, although particulars pleaded in support of this proposition also embrace such concepts as the trustee’s discretion not being exercised in good faith, or upon real and genuine consideration of the material before it, or in accordance with the purposes for which the discretion was conferred. However, the central allegation made by the plaintiff was to the effect that no reasonable trustee could have arrived at the decision.
4          Mr D Brookes SC with Mr N Bird of counsel appeared on behalf of the plaintiff. Ms P Neskovcin appeared on behalf of the defendant. No oral evidence was adduced. A large number of medical reports and other documents were tendered by way of joint Court Books of the parties were tendered. In addition, counsel made particularly helpful and detailed submissions. Ms Neskovcin provided a particularly useful outline of submissions and a voluminous folder of authorities. This was very much appreciated.
5          All relevant material was before the defendant at the time of the ultimate decision. Accordingly, no questions relating to materials subsequently obtained arise.

Factual background

(a) The definitions
6          Before turning to Mrs Carney’s background, the occurrence of injury and what occurred thereafter, I shall set out the clauses and definitions which are at the heart of this dispute.
7          It is to be remembered that central to this case is the issue of whether Mrs Carney was totally and permanently disabled as defined. Relevant definitions are found in the Australian Retirement Fund Trust Deed & Rules (“the Trust Deed”) and the Australian Mutual Providence Society Group Superannuation Policy (“the insurance policy”).
8          In the Trust Deed the definition of “Total and Permanent Disablement” is as follows:
“‘Total and Permanent Disablement’ means in relation to a Member having been absent from work through injury or illness for an uninterrupted period of six months or for such shorter period as in the circumstances the Trustee considers appropriate and in the opinion of the Trustee after consideration of evidence and advice satisfactory to it having become incapacitated to such an extent as to render the Member unlikely ever to engage in work for reward in any occupation or work for which he is reasonably qualified by education, training or experience PROVIDED THAT if the Trustee pursuant to Rule 1.4 has effected a policy or policies of insurance under which insurance is payable in the event of the disablement of any Member or group of Members and the circumstances in which the disablement insurance is or would have been or become payable in respect of the Member under such policy or in the opinion of the Trustee similar to Total and Permanent Disablement defined as aforesaid, then the Trustee may determine that the aforesaid definition of total and permanent disablement shall in respect of the Member concerned be modified so as to be identical to the circumstances in which disablement insurance usually would have been or become payable in respect of any Member or Members under such policy, and ‘Totally and Permanently Disabled’ shall have a corresponding meaning.”

9 Accordingly, this takes us to the definition in the insurance policy which reads as follows:
“‘Total and Permanent Disablement’ of an Insured Person
means disablement which:

(1) occurs prior to his sixtieth birthday; and
(2) occurs while he is insured for Total and Permanent

Disablement under this policy; and

(3) occurs while he is in active service of the Employer.
And either:

(a)

results from an illness, accident or injury and results in him being continuously absent from his employment for at least six consecutive months commencing prior to his sixtieth birthday and AMP has determined that it is unlikely he will ever be able to engage in any regular remunerative work for which he is reasonable fitted by education, training or experience…”

(b) The plaintiff’s employment and the occurrence of injury
10        Mrs Carney was born on 23 September 1949. She was a long time employee of Fletcher Jones & Staff (“Fletcher Jones”), an entity which effectively had the defendant as the trustee of its superannuation fund and, at the relevant time, AMP as the insurer. It was not contested but that she had very little education, leaving school after Form 1. After working at a milk bar in Warrnambool for approximately six months, she joined Fletcher Jones at the age of 15 years. Ultimately she became a trained cutter. She worked for no other employer again other than Fletcher Jones.
11        Many statements have been put in evidence indicating that, prior to approximately late 1992 and early 1993, Fletcher Jones was a very benevolent employer with staff working for it for decades. Indeed, I notice that the plaintiff himself was also employed by Fletcher Jones as a cutter, and worked there for something in excess of 44 years.
12        In any event, returning to Mrs Carney, she worked for Fletcher Jones until such time as she left to have her family and raise them. She had three children. She returned to work again at Fletcher Jones in approximately March 1990. Shortly after that she was diagnosed as suffering from right sided breast cancer and on 7 June 1990 she underwent a modified radical mastectomy performed by Mr Stephen Fischer, consultant surgeon. The surgery involved the removal of her right breast and also glands from under her right arm.
13        Following this, the plaintiff resumed employment with Fletcher Jones in late July 1990, but worked only half days because of the need for chemotherapy treatment which she was undertaking in Warrnambool. In October and November 1990 the plaintiff ceased work again as it was necessary for her to have extensive chemotherapy treatment at the Peter McCallum Clinic in Melbourne. She then required further chemotherapy which was performed at the Warrnambool Base Hospital.
14        Ultimately Mrs Carney was cleared to return to work on light duties (and whether or not these constituted real work or a made-up job shall be discussed subsequently) on a full-time basis in June 1991. It should be said that, apart from any general debilitation caused by the treatment of the cancer and the chemotherapy, Mrs Carney’s principal source of pain and restriction was her right side and particularly her right arm.
15        As a result of her right sided problems, and particularly those of the right arm, the work which Mrs Carney returned to was basically one of inspecting garments. She was not required to perform any lifting or cutting. Prior to the takeover by Pelaco, which seems to have occurred around about Christmas 1992, Fletcher Jones was, as stated, a benevolent employer that attempted to provide some sort of work for its injured or disabled employees. I note the statement of the plaintiff of 7 October 1998 to the effect that, following the surgery, Mrs Carney, had very limited use of her right arm which used to become quite swollen, painful and restricted in its movement. I also note in that statement of 7 October 1998 that Mrs Carney, when performing her light duties, shared them with a young woman with an intellectual disability.
16        In any event, the business was sold to Pelaco at approximately Christmas 1992 – see the statement of Valerie Joy Billings of 4 November 2009. Ms Billings was the Human Resources Manager at the time. Ms Billings has also stated that Pelaco directed herself and others to downsize the staff by approximately 60 people, leaving the staff that were both flexible and efficient. Ms Billings has recalled that the group of 60 who were terminated included people who were wheelchair bound and some who were deaf. Whilst some ambiguity exists as to how clear Ms Billings’ recollection of Mrs Carney might be, she has no doubt that Mrs Carney was made redundant because of her inability to work full-time at normal duties and be flexible and be 100 per cent efficient. Her statement shall be discussed further when the lay evidence is being considered.
17        Thus, in March 1993 Mrs Carney was sacked. She did not work again between then and her death in 2005.

The material before the defendant at the time of its decision of 21 April 2010
18 Following this matter coming on for hearing before His Honour Judge Robertson on 3 September 2008, it was adjourned effectively in order to enable the plaintiff to gather more material which would support his claim. Thus, what has been described as the fourth decision, and which provoked this litigation, was effectively fully reassessed following the provision of that additional material. In a letter to the plaintiff’s solicitors on 28 April 2010, the defendant stated as follows:
“The Claims Review Committee reviewed all of the evidence relevant to this claim including the correspondence from the insurer dated 1 April 2010, in which it advised it had maintained its decision to decline the claim, correspondence from your firm dated 29 January 2010 (including attachments) and 27 January 2010 (including attachments) and a medical report from Dr P Hall. The Claims Review Committee reviewed all of the evidence previously considered including the correspondence from the insurer dated 26 November 2007 and 4 May 2007, in which it advised it had maintained its decision to deny the claim, correspondence from your firm dated 28 September 2006, 18 May 2006 and 1 May 2006, including the medical evidence from Mr S Fischer.
The Claims Review Committee reconsidered all the evidence submitted and resolved that the late member did not meet the definition of Total and Permanent Disablement whilst insurance cover was in force.”

19 I shall now turn to a summation of that material. It should be pointed out that there is nothing to indicate that the defendant arranged any medical examination of Mrs Carney during her lifetime. It would also seem that the statements from the various lay witnesses who worked for Fletcher Jones at the relevant time were assembled and provided by the plaintiff.

(i) The plaintiff’s statements
20 I have already made reference to one of these. A considerable part of the history of events set out above has been based upon them. The statement of 7 October 1998 does contain the following:
“Without any explanation my wife was finished up and sacked in March 1993. There were about 30 other employees who were also sacked at that time without explanations. Management seemed to weed out all the people with handicaps or physical problems which had been completely against the code of practice of the late Sir Fletcher Jones who believed in giving everyone a chance and went out of his way to employ people with handicaps or job restrictions…
At the time my wife was sacked from Fletcher Jones she was really working in a very restricted environment almost doing sheltered workshop type jobs, which were jobs of an extremely light type involving no lifting or cutting or physical work at all.
She was capable of doing a variety of very light jobs including putting buckles on kilts which was a job involving a special machine.
Since being put off work she has no hope of obtaining any sort of employment in the broader industrial sector and she has no other skills, trade or training…
Her only capacity for employment prior to being sacked in the very light work environment which Fletcher Jones specially made available to her (sic). In the real world once she was put off work at Fletcher Jones there was no job that she could perform or for which she had any training or experience.”

21 In his second statement of 30 August 2006 the plaintiff stated as follows:
“My wife had no other transferrable skills as a worker – she had never been a receptionist in her life, and had no computer skills. She had never used a switchboard.
I recall that, at the time that the my wife was made redundant in March 1993, Helen Collins was also made redundant (she being the young woman with the intellectual disability with whom the plaintiff’s wife shared her light duties), along with a man who had psychiatric troubles, named Alan Brown.”

22        Essentially no challenge was made to these propositions. It is to be remembered that, at the time of the plaintiff making these statements, he had been for many years an employee of Fletcher Jones.

(ii) Medical reports of Mr S Fischer
23        The defendant had before it four reports of Mr Fischer, these being dated 6 December 1995, 24 April 2006, 21 September 2006 and 29 January 2010. It also had before it a document more in the nature of a questionnaire but headed “Disability Claim Medical Report” completed by Mr Fischer on 8 March 2007.
24        The report of Mr Fischer of 6 December 1995 describes the surgery performed and the subsequent treatment by way of chemotherapy and radiotherapy. It also contains the following:
“Since her initial treatment, there has been no sign of recurrence of her tumour but she complains of persistent ache in the right arm, which she gets with any extended use of the arm and more lately, since 13 November 1994, she has developed pain over the right side of her ribs and this has remained persistent. She would be unable to wash a window or make a cake because of the aching in her arm which these repetitive movements would induce. She did have a lipoma overlying her ribs in the region of the pain and this was excised, but in fact, did nothing to alleviate the pain. She has recently been trying some acupuncture in order to try and relieve this persistent pain which she finds quite incapacitating. Initial investigations in November and December 1994 of this pain failed to reveal any cause. This included a chest x-ray and bone scan.
In my opinion Mrs Carney is not able to hold down a permanent job. Her education extended to second form level and so she would only be suitable for some sort of manual work.”

25 Mr Fischer’s second report of 24 April 2006 is brief and contains the following:
“It was my view when the report was written (the report of 6 December 1995) that Mrs Carney would not be able to hold down permanent employment. Given her education extended to second form level she would not have been able to hold down a non-manual job and her symptoms would not readily have suited manual work of a permanent kind. Subsequent medical history confirms this view.
I agree that the last past paragraph (sic) is somewhat confusing but the preceding paragraph makes it pretty clear that Mrs Carney had markedly reduced use of her right arm.”

26 A third report of 21 September 2006 also sets out a history of events. This includes reference to the fact that tests carried out by Mr Fischer or at his request between the date of surgery and 22 November 1994 were essentially clear. Mr Fischer, in this report, was basically provided considerable information previously supplied because the defendant had mislaid his initial report. This report concludes:
“In the last question of the report I thought that she would never return to any type of work. Her subsequent history has proved that to be the case with development of metastatic disease from her carcinoma.”

27 The questionnaire-type report completed by Mr Fischer on 8 March 2007 lists doctors who had essentially treated Mrs Carney in 1990 and the dates of attendance of Mrs Carney upon Mr Fischer between 1 June 1990 and 12 May 1995. From approximately December 1991 onwards it would appear that Mrs Carney was reviewed by Mr Fischer twice a year, at least until 12 May

1995. In relation to “occupation details”, Mr Fischer has written:
“Cutter – Cutting outskirts and making alterations. Moved to
Final Inspection Department after operation.”

28 He has also given us the date upon which Mrs Carney was first unable to perform all the duties of her normal occupation as a result of her injury or sickness as being 4 June 1990.
29 Mr Fischer’s report of 29 January 2010 again sets out the history of events. It also contains the following observations:
“It should be noted that Veronica had metastatic breast cancer … (which) is generally a progressive disease. As well as specific local effects from metastatic deposits there is often a systemic effect consisting of weight loss, tiredness and a general feeling of unwellness.
Clearly Veronica was not able to perform her normal work. She did manage to work as a supervisor. I am simply unable to say whether she performed this latter task to satisfaction of her employer or not (sic). I am unable to say whether she was employed at this time on the basis of benevolence from her employer.

Equally clearly Veronica was unable to work by 1995 and would then have fulfilled a definition of total and permanent disablement provided by you.
Did Veronica fulfil this definition in 1994. No doubt she could have made a cup of tea at this time. Could she have made 20 cups of tea? Possibly. Would anyone employ her on this basis – probably not. Could she have made 300 cups of tea? I think the answer to this last question is no. Could she have buttered 50 scones – probably not. My own view is that no realistic employer would have employed her.
Could Veronica have worked as a supervisor? This would depend on what she was supervising. Her field of expertise was clothing of which Fletcher Jones was Warrnambool’s last bastion in the clothing industry. Given that she was terminated from there she would have to look for another industry which would require retraining. Given her age and education and the systemic effects with metastatic disease I think it unlikely that she would have coped with this.
This leaves the situation as to whether or not Veronica was totally and permanently disabled in March 1993. To objectively answer this question you would need to talk to her employer and fellow workers. Did she perform her job at Fletcher Jones effectively? What evidence do you have that she was employed because of the benevolence of the company? These are questions which you will have to garner the evidence in order to answer them. Given the slow relentless progression of her disease and with the benefit of hindsight I think the case may be arguable but this is a matter for judges, juries and lawyers.”
(iii) The report of Dr Philip Hall

30 This report, of 22 January 2010, is another item that was obtained following the adjournment before His Honour Judge Robertson and supplied prior to the making of the ultimate decision. Dr Hall is a general practitioner. Exactly when Mrs Carney became his patient is not clear, but Dr Hall has stated that he had the privilege of being able to care for her up until her death in 2005. It is apparent that Mrs Carney was seen regularly at the clinic when she was performing “diminished duties up until March 1993”. Dr Hall has also referred to the fact that, from early 1993, her visits to the clinic increased to an almost monthly basis. Dr Hall’s report is instructive, and I shall set out some sizeable extracts from it:
“I believe that she returned to her employment in mid 1991 as a full time employee but on the basis that she worked light duties only. She continued in this role with diminished duties up until March 1993 when her employment was ceased. Throughout that period of time she was seen regularly at the clinic and required regular investigation for her current symptoms of pain, insomnia, anaemia and headache. From early 1993 her visits to the clinic for investigation and management of a range of symptoms increased to an almost monthly basis.
Mrs Carney had a very strong work ethic and also was very keen to attempt to keep life as normal as possible, hence her desire to continue work in some role, despite the obvious hardship involved in carrying out her duties at Fletcher Jones…
In terms of Mrs Carney’s ability to work following her diagnosis and treatment of breast cancer in 1990 I believe that her return to work in any capacity following the diagnosis and subsequent courses of chemotherapy, surgery and radiotherapy were indeed remarkable, although not surprising given her tenacity and desire to show that she could beat her disease. In addition to her loyalty to her employer I believe that this loyalty was repaid to her in that she was provided with a position involving light duties which was created for her and was modified as her ability to perform those abilities was progressively curtailed by her associated breast cancer symptoms.
Certainly by the time of redundancies which were made in March 1993, I believe this is supported by investigations and the frequency of Mrs Carney’s medical visits at the time, her chest pain, headache and sciatica, that she was in no way fit to resume any sort of employment no matter how light the duties. I also believe that had Fletcher Jones not been able to provide her with a markedly modified position that she would have been deemed totally and permanently disabled years earlier. I have no doubt that she would not have been successful in finding employment following her redundancy in March 1993 due to her physical state.
I had the privilege of being able to care for Mrs Carney up until her death in 2005 and I was repeatedly impressed by her ability to overcome adversity and maintain her independence as long as she did. To remain employed and contributing to her workplace and her family would have been very important to her and I am certain that this was why she was able to work as long as she did following her diagnosis and treatment. By 1993 with the loss of the very supportive and adaptable work environment provided by Fletcher Jones, further employment would have been untenable.”
(iv) Statements of various fellow employees at Fletcher Jones at the relevant time

31 A number of these were before the defendant at the time of the decision. I shall now summarise them, also indicating the position occupied by each person at the relevant time.

(a) Thomas McCosker (factory manager)
32 Mr McCosker knew Mrs Carney, and was aware that she suffered from breast cancer. He could not specifically recall the details but “probably would have been consulted” about Mrs Carney’s return to work. He has some recollection of her coming back on light duties, but his recollection sounds tentative at best. However, his statement includes some useful remarks about the system of work that prevailed in relation to injured or disabled employees. Mr McCosker has described Fletcher Jones as an extremely benevolent employer which promoted family ambitions by providing dual incomes and “once you got a foot in the door you basically had a job for life”. Mr McCosker could recall work being given to a young woman who was deaf and dumb and persons with intellectual disabilities. He also stated injured workers were encouraged to return to work as quickly as possible and jobs that would otherwise have not existed were created. He has stated that:
“…I wouldn’t disagree with the proposition that lots of workers including Veronica returned to work in a ‘sheltered workshop’ environment. People that were otherwise 100% unable to work were given something to do even though it might be something very modest. People were additionally given something to do if, for example (and I think it happened in Veronica’s case) they had run out of sick leave entitlements…
There is no doubt that as a March 1993 (sic) there were people on our books with injuries who otherwise wouldn’t be qualified and/or physically capable of undertaking outside employment.”

(b) Ronald Oakley (presser, machinist, cutter, shop steward)
33 Mr Oakley knew Mrs Carney, but did not know her well. He was aware that she developed breast cancer and returned to work on light duties. In relation to the employment policy which had prevailed, Mr Oakley described Fletcher Jones as a very understanding employer in regard to workers who suffered from injury or illness, and also stated:
“…I agree that sometimes jobs were created to enable injured workers to return to work, and also jobs were given to people that were tailor made to accommodate their problem. This was an attitude of the company that was always part of the company philosophy … This philosophy was in part driven by the fact that almost all the workers were shareholders in the company.”

(c) Ms Kay Furnari (floor manager)
34 Ms Furnari knew Mrs Carney, but not well. She was aware that Mrs Carney suffered from breast cancer and that she returned to work on light duties. She could recall that, as at March 1993, Mrs Carney worked at the end of the line as a garment inspector or garment checker. She also agreed that Fletcher Jones had taken a very beneficial approach to employment in relation to its injured workers, and stated that the average age of the workforce was approximately 50 years. This was because Fletcher Jones kept on as employees people who were injured or who were not particularly good at their job. In relation to Mrs Carney, Ms Furnari’s statement includes the following:
“Specifically, in relation to Veronica, I believe that as at March 1993 if she’d not had the job that she did at Fletcher Jones and Staff that she would have been effectively unemployable elsewhere, and in part that was because of her illness and resultant emotional state.”

(d) Mr Peter Garner (warehouse and logistics manager)
35 Mr Garner knew Mrs Carney, but not well, and was unaware of her health problems. However, he has commented about management policy particularly in relation to the treatment of injured workers. He has stated as follows:
“The policy was extreme in the sense that people could come back to work and basically sit there and do very little if anything rather than be a worker doing a solid day’s work, and this was because of the benevolent nature of the company with a strong desire to have people having some source of income and emotional security despite their injuries… Such a policy was unique in the clothing industry in Australia at the time and I know of no other like industry that had a similar policy in place as at March 1993.”

(e) Ms Valerie Billings (human resources manager)
36 Reference has already been made to the statement of Ms Billings, particularly in relation to the attitude adopted by Pelaco after the takeover in late 1992. Ms Billings added that, in relation to the ongoing employment of Mrs Carney after her illness, “…it would have been purely out of the goodness of our corporate heart and solely motivated by a desire to assist her healing process. This would have been the case even if she was unable to do practically anything at all.”

(f) Ms Lilian Wilkinson (a co-worker who worked with Mrs Carney in the quality control inspection area prior to December 1992 when she took a redundancy package as a result of an injury to her spine)
37 Ms Wilkinson worked for a year or more with Mrs Carney in the quality control inspection area, and worked approximately three or four away from her, thus being able to observe her at close range. Ms Wilkinson’s statement contains the following:
“This was after her breast cancer surgery and I observed that she had great difficulty in lifting or pushing quality control stock and she used to complain regularly that her right arm used to throb. I was continuously having to help her perform her duties and that continued up until I injured myself. In my view Veronica Carney was significantly disabled in both an emotional and physical sense;
At that time, the management of Fletcher Jones and Staff tried to keep injured workers working as long as they could, but out in the real world I am certain that Veronica would have been unemployable. For example, before I went to Fletcher Jones…I was a self-employed business person running a bridal shop, and I know that Veronica would not have been able to perform any customer service duties or other duties involved with that business.”

(g)

Mr John McCosh (purchasing officer, office manager and after sales manager)
38        Mr McCosh knew Mrs Carney, but mainly through her husband who also worked at Fletcher Jones. He was aware that she had breast cancer, but was not otherwise closely involved with her. His statement includes comments on the co-operative scheme, the longevity of employment, and the fact that there were a number of people who worked at Fletcher Jones for some 40-50 years. I might say that this is quite apparent from the length of service of some of the other people who made statements. It could be said that the statement of Mr McCosh adds little to what is contained in other statements.

(v) Statement of Claim by next of kin
39        This is a pro forma document in the nature of a questionnaire which was completed by the plaintiff. It indicates, as a matter of interest, that the plaintiff’s original general practitioner was Dr Maxwell of the Jamison Street Clinic, Dr Hall becoming her general practitioner in 1991. It describes the plaintiff as being restricted to light duties between June 1991 and March 1993 and being unable to work at all between March 1991 and her death. It sets out that she left school at the age of 14 years, at the Form 1 level, and that her only other employment had been as a waitress in 1964. Her job at the time of ceasing employment was described as being that of an inspector of garments, and she had been in that position for 18 months. Her hours of work are described as being from 07.30 to 12.30 (on the evidence, this would not seem to be correct and the fact that Mrs Carney was a full time worker immediately prior to her retrenchment is not disputed).

(vi) Employer’s statement
40        This is a type of questionnaire. It indicates that Mrs Carney was employed by Fletcher Jones Trousers Pty Ltd (whether this is the same as the original Fletcher Jones entity is not clear) from 26 March 1990 to 23 March 1993. I accept that she worked for the Fletcher Jones organisation for a much longer period, although was absent for some time when raising her family. Her usual job is described as that of a trimmer, and the last date on which she performed her usual job was said to be 23 March 1993. This does not sit particularly well with the balance of the evidence in relation to her being an inspector in the closing period of her employment. The vast bulk of the questions relating to income, duties, absences and the like have been simply left unanswered. Her hours of work are described as 7.30am to 4pm, and her average hours per week as 38. The reason for her termination is described as “made redundant”. The person completing the form is described as “H. Cortenbach” whose position is said to be that of payroll manager, and the form is dated 3 November 2006. A note has been added at the conclusion of the document to the effect that the factory in which Mrs Carney worked was no longer in existence, which explained why many questions could not be answered as there was nobody qualified to answer them.

(vii) Correspondence from the insurer
41        At the time of making its ultimate review on 21 April 2010, the defendant also had before it correspondence from the insurer dated 4 May 2007 and 26 November 2007 in which the decision to deny the claim was maintained. It is to be remembered that some confusion existed for a lengthy period as to the identity of the insurer as at the termination of Mrs Carney’s employment, it originally being thought that the insurer was AXA Australia and it ultimately being discovered that the insurer was in fact AMP. The letter of 4 May 2007 is from AXA Australia to the defendant, and is in the form of an email. It does no more than state that AXA was not on risk as at 31 December 1992 and was therefore not liable. The letter of 26 November 2007 is from AMP to the defendant. It responds to a letter from the defendant, which letter sets out the history of events and contains assertions such as, “The evidence did not establish that Mrs Carney ceased working because of her health and consequently a valid claim did not exist”, and, “The Trustee considered the claim at the Claims Review Committee Meeting held on 13 June 2007 and resolved that the late member did not meet the definition of TPD whilst insurance cover was in force”. A copy of the claim file was passed to AMP. The letter of 26 November 2007 from AMP contains a list of the evidence which it considered and which essentially was the AXA employer statement; the AXA employee statement; the medical report of Mr Fischer of 23 December 1994; a further report of Mr Fischer of 21 September 2006; and letters from the defendant of 24 July 1995, 20 February 1996, 19 February 1997 and 2 November 2007. The letter also contains the following:
“At the date AMP became the insurer of the Fund on 1 January 1993, the Deceased was performing modified full-time duties as a Quality Control Inspector and AMP has considered the Deceased’s claim under these duties only.
All the information provided indicates that the Deceased did not cease work due to any illness on 23 March 1993 but was retrenched from her position as a Quality Control Inspector along with other employees working in the factory. Not long after the employees were retrenched, the factory closed down. The Deceased was able to work full-time hours in this position from June 1991 up until her retrenchment in March 1993.
There is no supportive medical evidence, nor medical certification stating that the Deceased was completely unable to perform all her full-time duties as a Quality Control Inspector at the time she was retrenched in March 1993.
It has been noted that Dr Fischer, in his report dated 21 September 2006, states that he did write a medical certificate on 23 December 1994 advising that the Deceased was unable to perform her normal work as her right arm would ache when she tried to do repetitive work. This certificate was issued nine months after the Deceased was made redundant.”

42 Relevant parts of the definition of total and permanent disablement are then set out. The letter then goes on:
“As there is no supportive medical evidence dating from the time the Deceased last actively worked in March 1993 stating that the Deceased was completely unable to perform her duties as a Quality Control Inspector, no valid claim for Posthumous Total and Permanent Disablement exists.
In view of general Trustee’s responsibilities, it is important that the Trustee review the medical and other evidence and form its own view as to the late Mrs Carney’s claim. AMP recommends that this review be documented in the minutes of a Trustee meeting.”
(viii) Numerous items of correspondence

43 There has been a large amount of correspondence in this matter over the years. Exactly what was before the defendant at the time of decision of 21 April 2010 is not entirely clear but its letter of 28 April 2010 indicates that it reviewed all of the evidence previously considered. If that be so, a large amount of correspondence would have been considered, as, for example, would have been the employer’s statement and the employee’s statement as set out above and referred to by the defendant in an email of 24 October 1995. I use that as an example of evidence that clearly had been submitted to the defendant on prior occasions but is not specifically referred to in the letter of 28 April 2010. It is to be remembered that, in this letter, the defendant referred to all of the evidence previously considered but made specific reference to more recent items as having been included. I shall not set out details of the almost hundreds of other items of correspondence and the like that have passed back and forth between the parties. I have set out above the material which seems to me to be of relevance or significance or which received particular attention in the submissions of counsel.

The submissions of the parties

(a) The submissions on behalf of the plaintiff
44 Mr Bird made the initial submissions on behalf of the plaintiff and Mr Brookes addressed by way of reply. The submissions of Mr Bird could be summarised as follows. I shall omit those parts of the submission which were in essence a summary of the sequence of events or factual background.
45 The position adopted on behalf of the plaintiff has essentially been the same throughout. It is to the effect that, prior to being retrenched, Mrs Carney was working in a made-up job which was virtually a sheltered workshop. In fact, after the surgery she had no employment capacity. The various statements obtained from colleagues and superiors at Fletcher Jones confirm that, in the period from 1991 until her retrenchment, the plaintiff was working in such a made-up job.

46        The report of Dr Hall of 22 January 2010 supports the proposition that the return to work by Mrs Carney following the treatment of her breast cancer and the symptoms which followed was remarkable and that a position involving light duties was created for her. Attention is also directed to the belief of Dr Hall that, by the time of the redundancies in March 1993, Mrs Carney was in no way fit to resume any sort of employment no matter how light the duties.
47        As is evident from the report of Mr Fischer of 29 January 2010, metastatic breast cancer is generally progressive. According to Mr Fischer, the plaintiff was clearly unable to work by 1995 and no realistic employer could have employed her in 1994.
48        The workmate evidence is virtually unanimous in relation to the description of Fletcher Jones as having been a benevolent employer that put nobody on the scrap heap, no matter what the degree of their disability. Where Mrs Carney worked was in the area set up for the very purpose of giving people, who would not otherwise have been able to get employment, a job. It was, to all intents and purposes, a sheltered workshop. Thus, the fact that Mrs Carney was in paid employment at the time of the retrenchment in March 1993 does not necessarily mean that she was then capable of regular remunerative work. The fact that what occurred to her was a retrenchment has coloured the defendant’s attitude to this claim from the outset. Reference is made in particular to the statement of Ms Furnari to the effect that, as at March 1993, if Mrs Carney had not had the job which she did at Fletcher Jones, she would have been effectively unemployable. Apart from those statements of lay witnesses concerning general policy, reference is also made to the statement of Ms Billings and that of Ms Wilkinson who worked close by Mrs Carney after her resumption of work and who expressed the view that Mrs Carney was significantly disabled and, in the real world, would have been unemployable.
49        On the basis of these matters, the question to be determined is whether the trustee acted either in good faith or properly or according to law in considering the material and particularly the further material supplied after the adjournment of the hearing before His Honour Judge Robertson.
50        Reference is made to the decision in Nile v Club Plus Superannuation Pty Ltd & Anor [2005] NSWSC 55, a case which highlights the need for insurance trustees to give real and genuine consideration to new evidence submitted to them when reviewing claims such as this. When all the material, including the recent material, was placed before the trustee, that should have been sufficient to satisfy the requirements of the definition. Given the history of decisions in the present case and the wording of them, it appears that the trustees had made the decision at the outset that, because Mrs Carney was retrenched, she did not qualify for the benefits and the defendant then never moved from this position despite the material placed before it. One indication that this is so is that, when the statements of the various lay witnesses were placed before AMP and subsequently before the defendant, each stated that such witnesses had no medical expertise or relied upon medical expertise, and accordingly neither determination was not altered – see the letter of AMP of 1 April 2010 and the re-assessment by the defendant of 13 April 2010. It had never been suggested that such witnesses possessed medical expertise.
51        The wording employed in the re-assessment of 13 April 2010 employs some wording identical to that contained in the earlier assessments. That re- assessment of 13 April 2010 completely ignores the remarks of Dr Hall, Mrs Carney’s general practitioner, to the effect that she was totally unemployable, and her general practitioner is well-placed to make such a comment.
52        In addition, the defendant did not make the further enquiries which it should have made as a trustee. For example, the employer’s statement is virtually blank. No enquiry seems to have been made about this, and the impression given is that the defendant did no more than look at the front page where it was said that Mrs Carney was retrenched. It does not appear that the defendant gave the matter full attention. Given that the plaintiff has been able to obtain statements from workmates and superiors of Mrs Carney, it would not have been too difficult for the defendant or Fletcher Jones to do this so that the type of details that would have assisted could have been obtained.
53        The minutes of the meeting of the Claims Review Committee of the defendant held on 21 April 2010 reveal that such meeting commenced at 3pm and closed at 3.15pm. There were clearly other matters on the agenda which have been deleted from the minutes provided. It means that the attention directed towards the plaintiff’s claim and the supporting material must have been very cursory. Reference is again made to the decision in Nile, and there should have been some evidence as to the process involved when Mrs Carney’s claim was considered.
54        Nile is also authority for the proposition that the word “unlikely” in the definition requires the defendant to take into account the actual likelihood of Mrs Carney obtaining employment. This must be looked at in terms of the real world. What has to be determined is, irrespective of the fact that Mrs Carney was still in the service of Fletcher Jones as at 23 March 1993, whether in the real world she was ever going to be able to engage in any regular remunerative work. In other words, Mrs Carney could be in the active service of the employer but still be unlikely ever to be able to engage in any regular remunerative work. The defendant did not follow up on the employer’s statement to ascertain just what work Mrs Carney was doing, what absences she had and the like.
55        Finally, reference is made to the decision in Hay v Total Risk Management Pty Ltd [2004] NSWSC 94 where an injured person who was struggling to cope with his employment, and was being pressurised in relation to the days that he was taking off, ultimately took a voluntary redundancy package. The court was willing to overlook the stated reason for the termination of the employment.

The submissions on behalf of the defendant
56        The submissions, both written and oral, of Ms Neskovcin, on behalf of the defendant, could be summarised as follows. I should add that many oral the submissions made by Ms Neskovcin included references to decided cases set out in her written submissions or contained in the large volume of authorities which was provided. I shall not refer to all of them or set them out in detail in this summary. I now turn to her submissions.
57        Material that was put before His Honour Judge Robertson after the adjournment of the matter should be considered to be part of the fourth claim as no new claim was made, but the existing claim was re-assessed. What the court has to decide is whether, in relation to the fourth claim, the defendant as trustee made a decision which no reasonable trustee could have made. At the time of its last decision, the trustee had all of the material before it.
58        To satisfy the definition, the disablement of Mrs Carney must result in her being continuously absent from her employment for at least six consecutive months and the insurer (and defendant) must have determined that it is unlikely that she will ever be able to engage in any regular remunerative work. It is the defendant’s submission that Mrs Carney’s disablement did not result in her being continuously absent from employment for the required period because the evidence suggests that the reason that she was absent from work was because of her retrenchment. It is conceded that she had been absent for six consecutive months prior to her sixtieth birthday, but for a reason totally different from that of disablement.
59        The questions to be answered are whether or not Mrs Carney was disabled at the time that she ceased work and whether as a result of that disablement Mrs Carney ceased to be an employee or to be absent from her employment. The court does not have to consider whether or not she was absent from her usual duties, namely that of a cutter, but whether or not she was absent from her employment at the time when she was performing the duties of a garment inspector.
60        Turning to the history of the claims, the first was made on 24 November 1994 and was in the form of a letter from Mrs Carney’s solicitors. The material that was before the defendant at the time of it making its first decision on 24 July 1995 included a medical report and certificate prepared by Mr Fischer and an employer’s statement and employee’s statement. Mr Fischer’s report was apparently prepared on 23 December 1994 and referred to the plaintiff being unable to do her normal job, unable to do repetitive work because her right arm ached and never being expected to be able to return to normal work. The report does not state that Mrs Carney was unable to do her normal work as at March 1993 and indeed Mr Fischer has never so stated. In any event, the question to be answered is not whether she could do her normal work, but whether she could do the work of a garment inspector which she was performing when employment ceased. Also, Mr Fischer, in his report of 23 December 1994 (which was in the form of a type of questionnaire), considered that Mrs Carney was fit for work not involving repetitive use of her right arm, such work being that of a supervisor or tea lady. The response of the defendant as trustee was that it was doubtful that a valid claim existed, given that the employer indicated that Mrs Carney was made redundant and, in her statement, she indicated that retrenchment was the reason for leaving work. Thus, from the very beginning, the available material revealed that Mrs Carney’s reasons for ceasing work were redundancy or retrenchment, and in those circumstances the decision of the defendant was entirely reasonable. The question now to be answered is whether the evidence that has become available demonstrates that the real reason for being made redundant was the disablement, and the court should not be satisfied in that regard.
61        The fact that the defendant initially made an error by referring to the wrong definition because of the mix-up concerning which insurer was on risk at the relevant time is not of concern because the error was ultimately cured. (I might add that there was no real dispute concerning this proposition which means, in essence, that the errors that had been made were overtaken by the trustee’s decision in relation to the fourth claim when it asked itself the correct questions and sent the questions to the correct insurer.)
62        The second claim was made on 11 October 1995 and on this occasion Mrs Carney’s solicitor set out a detailed history, and it is also apparent from that letter that Mrs Carney was cleared by her medical advisers to return to work on light duties on a full-time basis in June 1991. In that regard, the defendant makes the concession that what has to be considered in relation to the definition of total and permanent disablement is whether or not Mrs Carney was capable of full-time work.
63        The solicitor’s letter of 11 October 1995 also indicated, for the first time, that the plaintiff’s role upon resumption of work and until 1993 was the inspecting of finished garments. The court should not be satisfied that this was not a real job.
64        No further additional material was put before the trustee when it made its decision on 24 October 1995. In notifying Mrs Carney of its decision, the defendant stated the following in its letter:
“Should Mrs Carney be able to produce fresh medical evidence which showed that she is unlikely to ever engage in work for reward in any occupation or work for which she is reasonably qualified by education, training or experience, we would be happy to submit her claim to the Trustee for review.”

65        In the absence of further medical evidence, it was not unreasonable for the defendant to reach the decision that it did on this occasion.
66        The third claim was made on 22 January 1996. On this occasion, Mrs Carney also provided further medical evidence by way of a report dated 6 December 1995 from Mr Fischer. The report refers to the fact that there had been no sign of reoccurrence of the tumour but that Mrs Carney complained of persistent ache in the right arm with any extended use of that arm. (This report has been referred to above.) This report, as with the earlier one, did not address the question of incapacity as at 23 March 1993. In determining whether the ultimate decision was one that no reasonable trustee could have made, the court would have to be satisfied that relevant disablement existed as at the date of cessation of work – that is, that Mrs Carney was incapable of performing the duties that she was performing when she ceased work. The medical evidence from Mr Fischer does not answer that question or assist.
67        The third claim was rejected by the defendant on 20 February 1996. In its letter of notification of its decision, it was pointed out that, as a pre-requisite, a member of the fund must have ceased work for reasons of ill-health and it was repeated that Mrs Carney had ceased because, along with many others, she was retrenched rather than ceasing work for reasons associated with disablement. The notification also indicated that, regardless of the reasons for ceasing work, medical evidence indicated that Mrs Carney was fit for work which did not involve repetitive use of the right arm.
68        Some 10 years later the plaintiff’s solicitors wrote to the defendant, and, following correspondence, the fourth claim was made in May 2006. Attached to the letter constituting the claim was a copy of Mr Fischer’s report of 1995 and his brief report of 24 April 2006. A bundle of correspondence was also forwarded to the defendant. Effectively, the letter from the plaintiff’s solicitors of 18 May 2006 enclosed all the evidence which had previously been before the defendant in relation to the earlier three claims. The correspondence at this time from the plaintiff’s solicitors indicated that in 1991 Mrs Carney had been cleared for work on light duties on a full-time basis, the work being inspecting garments, and that she continued on those light duties until March 1993.
69        Further material supplied was a report from Mr Fischer dated 21 September 1996 and it indicates that a chest x-ray on 1 March 1991 was clear and that a mammogram on 18 June 1993 was clear, as was an x-ray on that day. A mammogram on 8 June 1994 was also clear. A bone scan on 22 November 1994 showed no evidence of metastatic disease. This report of Mr Fischer confirms that he only ever addressed the question of capacity for work as at 23 December 1994.
70        In relation to this fourth claim, the defendant wrote to Fletcher Jones asking for completion of an employer’s statement. Criticism of the manner in which this form was completed, in that large parts of it were left blank, is not warranted because it is clear that the factory had closed down by this time. Furthermore, a trustee has no obligation to make independent enquiries. It is obliged to consider the claim and any further material. One part of the form that has been completed would indicate that Mrs Carney was working on a full-time basis in 1993 prior to being made redundant.
71        On 9 March 2007 a further report from Mr Fischer and dated 8 March 2007 was provided. It indicated, that as at 4 June 1990, Mrs Carney was first unable to perform all the duties of her normal occupation as a result of her injury. Of course, the authorities establish that the fact that the injured person is performing duties other than those of the normal occupation is not sufficient to satisfy the definition of disablement. It is possible to be performing other duties as long as it is a real occupation.
72        (The flow of submissions of Ms Neskovcin was then somewhat interrupted by reason of overnight adjournment, my raising some points to be considered, and the arrival of Mr Brookes who had not been able to be present previously and who made brief submissions intended to address the issues which I had raised. Ms Neskovcin spoke briefly in this regard before returning to a chronological consideration of the claims. I shall set out these brief submissions at this point.) What the court has to be satisfied about is that the disablement results from an illness and results in Mrs Carney being continuously absent from her employment for at least six consecutive months. It is not a simple question of whether the disablement satisfies the definition. Further, the absence from employment means, in this case, absence from employment with Fletcher Jones. The relevant time is the date of cessation of employment. It is conceded that a person might resign from employment, not knowing that they really are disabled from further employment, or injury might develop or become a lot worse after such person had ceased employment ostensibly for reasons of resignation or voluntary redundancy. This would, in fact, satisfy the definition. It is submitted that those are different facts not present in this case.
73        Continuing in relation to the fourth claim, ultimately the defendant decided, having reconsidered all the evidence, that Mrs Carney did not satisfied the denifition and, on 19 June 2007, the plaintiff’s solicitors were notified of this. On 31 October 2007, the defendant determined to send the matter to AMP for assessment. Amongst other things, it responded that the evidence which it considered included the fact that Mrs Carney was performing modified fulltime duties as a quality control inspector in 1993 and it was these duties only that were to receive that consideration. This was appropriate. AMP pointed out that Mrs Carney was able to work full-time in that position from June 1991 until her retrenchment in March 1993. There was no medical evidence or certification that she was unable to perform those fulltime duties at the time that she was retrenched. This was accurate.
74        The defendant considered the matter again on 12 December 2007 and, on the basis of all the evidence submitted, including further correspondence from AMP, decided that Mrs Carney did not satisfy the definition. The plaintiff’s solicitors were advised of this on 21 December 2007, and that was how matters stood prior to the commencement of the trial before His Honour Judge Robertson in 2008. It was following the adjournment of the case that the additional material was supplied by the plaintiff.
75        The most that is established by the statements of the lay witnesses is that Fletcher Jones was a benevolent employer that encouraged employees to remain at work, and if necessary would obtain or provide light duties to enable that to happen. What the statements do not establish is that Mrs Carney effectively worked in a sheltered workshop, being kept on out of the goodness of her employer’s heart, and that, when she was made redundant, it was because of her illness. For example, the statement of Mr McCosker is very non-specific. What is said by Mr Oakley does not relate to Mrs Carney specifically. The statement of Ms Furnari in fact suggests that Mrs Carney, with some 80 other workers, worked on a line which ended with Mrs Carney’s position as a garment inspector. This was a real job, not a made-up job. It is also apparent that Ms Furnari did not know Mrs Carney very well. The statement of Mr Garner is of no great utility, and he also did not know Mrs Carney very well. Ms Billings was, in fact, retrenched not long after Mrs Carney and her statement is suggestive of speculation. It is a statement which is vague and non-specific and not of assistance. The statement of Ms Wilkinson establishes that Mrs Carney, along with others, worked in the quality control inspection area and the jobs being performed by them were real jobs.

76        The defendant considered all of this material at its meeting on 21 April 2010, again saying that Mrs Carney did not meet the definition, and notified the plaintiff’s solicitors accordingly. Against the background of the above history, the plaintiff is putting his case essentially on the basis that the defendant’s decision as trustee was one that no reasonable person could have come to on the basis of the material available. However, the particulars supplied in the Amended Statement of Claim include assertions that the defendant’s discretion was not exercised in good faith; it was not exercised upon real and genuine consideration; and that it was not exercised in accordance with the purposes for which it was conferred. However, in this case, unless the court is satisfied that the decision was one that no reasonable person could have come to, it cannot review the trustee’s decision and that is established by various authorities.
77        It is open to the defendant to determine that the definition of total and permanent disablement contained in the insurance policy should apply in respect of Mrs Carney’s claim. Turning to the definition, there are various elements. Firstly, the disablement must exist at the time Mrs Carney ceased work at Fletcher Jones. Secondly, there is no warrant for restricting work or employment to pre-injury work or employment. Next, absence from employment does not mean absence from usual duties. Next, references to occupations or work means a recognised occupation, and not a special light duties job made up for injured workers and means work which Mrs Carney was likely to obtain. “Unlikely” means a probability of less than 50 per cent. “Ever to engage” means on a full-time regular basis and the date of assessment is the appropriate date for determining whether the work was work for which Mrs Carney was reasonably fitted by education, training or experience. Authorities are cited for each of these propositions.
78        The plaintiff contends that Mrs Carney’s retrenchment was directly linked to her illness and therefore the definition is satisfied. To establish this, the plaintiff must prove that, as a result of disablement, Mrs Carney ceased to be an employee, or that illness was the cause of the cessation of employment.
79        Reference is made to the following list of authorities. The relevant propositions for which each stands, and particularly in the context of the present case, is summarised in brackets after each case name and reference:
Tuftevski v Total Risks Management Pty Ltd [2009] NSWSC 315 – (question to be asked is whether plaintiff was capable of present and future employment on light duties as at the last day he worked or within a reasonable time thereafter).
Cavill Power Products Pty Ltd v Royle (unreported Judgment of the Full Court of the Supreme Court of South Australia delivered 4 October 1991 and 10 December 1991) – (injured plaintiff given clerical duties which he performed until his resignation but did not perform well – work made up for him – definition satisfied).
Samaras v Australian Retirement Fund Pty Ltd [2007] FCA 1323 – (constituent elements of definition have to be satisfied and has to be causal link between disablement and absence from employment). It should be noted that, following the discussion of this decision and the meaning of “active service”, Ms Neskovcin conceded that Mrs Carney was in active service at the relevant time because she was performing the role of a quality inspector, but did not concede that disablement occurred whilst she was in active service.
Telstra Super Pty Ltd v Finch [2009] VSCA 318 – (relevant incapacity must exist at time of cessation of employment – six months absence from active work, as applied to the present case, means absence of Mrs Carney from Fletcher Jones, in turn meaning disablement must result in absence from the employment – trustee must consider whether as a result of the disablement the member ceased to be an employee and is unlikely to engage in gainful work – trustee is to make an assessment as to what is likely in the future taking into account past events for that purpose).
Baker v Local Government Superannuation Scheme Pty Ltd [2007] NSWSC 1173 – (trustee must be satisfied that cessation of employment was due directly or indirectly to permanent physical and mental incapacity – injured worker terminated because employer had no work for him that he could perform – distinguishable from present case because Fletcher Jones did have a role that Mrs Carney could perform).
Mabbett v Watson Wyatt Superannuation Pty Ltd & Anor [2008] NSWSC 365 – (pursuant to definition in this particular case, no warrant for restricting the term “employment” to pre-injury duties or normal duties – issue is whether the plaintiff’s injury caused the plaintiff’s absence in the sense of being a real and effective and proximate cause of that absence – illness or injury need not be sole cause – if alternative duties available, plaintiff would have been unable to show that injury had caused him to be absent from employment).
Halloran v Harwood Nominees Pty Ltd [2007] NSWSC 913 – (“reasonably fitted by education, training or experience” means as at the date of assessment).
80        The defendant does not accept the submission that its decision to reject the fourth claim was one which no reasonable trustee could make on the basis of the material before it. Reference is again made to the various documents which had been before the defendant and the totality of documents that were before it at the time of its ultimate decision in 2010.
81        Further, the evidence does not demonstrate that the defendant trustee failed to act in good faith even if some mistakes were made. In fact the defendant diligently assessed the claims and invited Mrs Carney or the plaintiff to submit any further medical evidence upon which reliance was to be placed.
82        In relation to the issue of the defendant acting with real and genuine consideration of the material, the question is not whether the court would arrive at the same decision on the material as did the defendant, but whether the defendant failed to act with real and genuine consideration. The facts of the present case do not warrant such a conclusion being reached. Further, by considering the claim and making its determination in the light of the available material, the defendant was exercising its discretion in accordance with the purposes for which such discretion was conferred. The fact that at times references were made incorrectly to the AXA definition is of no impact in that this misconception ultimately had no material effect and was cured. The same can be said in relation to correspondence suggesting that the definition that was required to be satisfied was that under the Trust Deed without reference to the insurance policy. Again this had no material effect.
83        If the plaintiff is successful, and the defendant argues strongly to the contrary, the appropriate relief granted would be that the matter be remitted to the defendant for reconsideration. Reference is made to the decision of Kowalski v MMAL Staff Superannuation Fund Pty Ltd (No.2) [2008] FCA 691 where the court itself executing the trust was described as a rare event. However, in some cases it has occurred – see Sayseng v Kellogg Superannuation Pty Ltd [2003] NSWSC 945 and other cases such as Rapa v Patience (unreported, NSWSC, 4 April 1985). A court might substitute its own decision if it formed the view that the same error would occur again and again. The authorities do not establish a clear principle that can guide the court as to when it is appropriate to remit and when it is not. The appropriate order in the present case, should the plaintiff be successful, would be that the matter be remitted for reconsideration in accordance with the court’s reasons.

Reply on behalf of the plaintiff
84        Mr Brookes replied on behalf of the plaintiff, and his submissions could be summarised as follows. I am including some earlier observations made by him during Ms Neskovcin’s address.
85        The insurer’s definition of total and permanent disablement, as found at pages 83 and 84 of the court book, contain six ingredients which the defendant as trustee is bound to consider. They are:

(i)

disablement must occur prior to the member’s sixtieth birthday (Mrs Carney, having been born in 1948 and dying in 2005, clearly satisfied this);

(ii)

disablement must occur while the member is insured for total and permanent disablement under the policy (there is no contest about that);

(iii)

it must occur while the member is in the active service of the employer (Mrs Carney’s disablement so occurred);

(iv)

the disablement must result from an illness, accident or injury (the disablement has resulted from an illness, namely the breast cancer);

(v)

the disablement must result in the member being continuously absent from employment for at least six consecutive months commencing prior to the sixtieth birthday (even if it is viewed that the absence from employment commenced at the time of the retrenchment, Mrs Carney was absent from her employment for at least six consecutive months prior to her sixtieth birthday and this resulted from the disablement);

(vi)

by reason of the disablement, AMP must have determined that it is unlikely that the member will ever be able to engage in any regular remunerative work for which the member is reasonably fit by education, training or experience (it is asserted that Mrs Carney as at the relevant time was unlikely ever to be able to so engage. That was so during the six month period and at any time after March 1993. It was always unlikely that Mrs Carney would ever be able to so engage in the type of work described).
86        Mrs Carney’s physical disablement existed both before and after the date of retrenchment, was the same physical disablement, and it satisfied the six ingredients. The logic of this is demonstrated by the following. Had Mrs Carney gone off work because of her disability on 23 March 1993, and three months later the company had gone into liquidation so that her employment then ceased, that would mean, if the disability does not commence until the cessation of employment, the requirement in relation to six months could not be satisfied. In fact, she must be absent from employment for which she is capable. Hence, the question is whether, on all the evidence, as at the date of retrenchment was Mrs Carney disabled to the extent that she would satisfy the definition, and particularly the definition as it relates to the six month period after retrenchment. The key to this is disablement in relation to employment for which the person is capable as opposed to employment with the particular employer. In any event, the lay evidence establishes that Mrs Carney was in protected employment prior to retrenchment, and was retrenched when it was considered that she and others were of no commercial use and could not engage in any regular remunerative work. As long as Mrs Carney could bring herself within the six ingredients referred to, the fact that she was kept on for a period at Fletcher Jones in a charitable situation does not mean that she became disentitled when she was thrown onto the open market. She had the same level of disability the day before and the day after retrenchment.
87        The defendant as trustee, in looking at the retrenchment as being virtually the sole cause of Mrs Carney’s absence from employment and therefore deciding that she was disentitled, erred. It does not seem to have considered the possibility of there being another reason for her ongoing absence from employment. It was bound to consider the six ingredient definition and interpret it as above, and it failed to do that. If, for example, Mr Carney had reported to Fletcher Jones that she could not continue in her employment and three days later the company had gone into liquidation or otherwise retrenched her, there would be an absence from employment, but there would be two reasons for it. One would be the liquidation or retrenchment, the other being the disability.
88        Bearing in mind the evidence of the lay witnesses as to the degree of the plaintiff’s disablement between 1991 and 1993, no reasonable trustee could find that what she was doing amounted to regular remunerative work or was anything other than, effectively, being employed in a “sheltered workshop”.
89        A second error on the part of the defendant as trustee was not considering whether there was a causal link between the retrenchment of Mrs Carney and others and the fact that these were people with disabilities. The defendant was bound to look at the legal situation as outlined, and consider whether the job was a real job and whether Mrs Carney had a level of disablement. In not taking such things into account and dismissing her claim on the basis that the sole cause of disablement was retrenchment, the defendant arrived at a decision at which no reasonable trustee could arrive. Thus, there are two central issues to take into account – firstly, whether the disablement which clearly existed as at 23 March 2003 was a cause of a continuous absence from employment in addition to the retrenchment being such a cause, and secondly whether the disablement in fact caused the retrenchment. There was a lack of consideration of the material insofar as it relates to these issues, and this has resulted in a rejection which no reasonable trustee could have made on the basis of such material.
90        The medical evidence of Dr Hall and, for example, the statement of Ms Wilkinson who worked only three or four feet from Mrs Carney during the relevant period, clearly establish the level of disablement.
91        The discretion of the defendant as trustee miscarried. No reasonable trustee could have arrived at the decision.

Ruling

92

I say at the outset that a case such as this is not in the nature of an appeal or a judicial review and the decision cannot be impugned simply because, were I the defendant trustee, I might have or would have arrived at a different conclusion. Essentially what lies at the heart of the present dispute is the reasonableness of the decision. A component of that is the consideration, or the lack of correct consideration and interpretation, given by the defendant to the material, and particularly to some aspects of it.

93

Having considered the material which was before the defendant as at the time of it making its ultimate decision on 21 April 2010, such material being all material previously before it and all material put before it subsequent to the adjournment of the matter on 3 September 2008, I have reached the conclusion that no trustee acting reasonably could have decided at the conclusion that the plaintiff was not totally and permanently disabled within the meaning of the definition. Whilst the assembling of that material over the years was done on a somewhat piecemeal basis, punctuated by decisions of the defendant and by errors made in relation to the applicable definition, when all the material was before it the defendant made a decision which no reasonable trustee could have made.

94

I have already set out various extracts from both the statements of lay witnesses (including those on behalf of Fletcher Jones and the plaintiff) and medical reports which were before the defendant at the relevant time – namely, when its ultimate decision was reached. On the basis of those statements and report, I have arrived at the conclusion that, as at the time of the retrenchment, the plaintiff was unable to engage in any regular remunerative work for which she was reasonably fitted by education, training or experience and that it was unlikely that she ever would so engage. Whilst she was in the active service of her employer, she was disabled and was performing a made-up job. Prior to its change in attitude following a takeover, Fletcher Jones had a policy of great benevolence pursuant to which disabled persons were kept at the workplace despite their disabilities. Once the policy changed, such persons were removed from the workplace, Mrs Carney being one of them. It was then quite apparent that she was unemployable in terms of regular remunerative work for which she was reasonable fitted. She was then continuously absent from her employment for at least six consecutive months, and in fact did not work again.

95

In relation to the conclusion which I have reached, I would point to the following aspects of the material which was before the defendant at the relevant time. These features of that material are not listed in order of importance.

(a)

Whilst Ms Neskovcin criticised the statements from the lay witnesses on the basis of an alleged lack of specificity, Ms Wilkinson not only knew Mrs Carney but worked with her after her return following the initial treatment for a period of “a year or more”. Ms Wilkinson has stated that they worked only some three or four feet apart, and she was able to observe Mrs Carney “from close quarters”. She observed that Mrs Carney had great difficulty in lifting or pushing quality control stock and would complain regularly about throbbing in her right arm. In her statement of 17 November 2009, Ms Wilkinson expressed the view that Mrs Carney was significantly disabled. Ms Wilkinson also expressed the view that “…out in the real world I am certain that Veronica would have been unemployable”. The statements of lay witnesses such as Ms Wilkinson seem to have been virtually totally discounted by both the insurer and the defendant on the basis that the persons concerned denied knowing Mrs Carney well and were witnesses that had no medical expertise nor relied upon same. Ms Wilkinson obviously knew Mrs Carney quite well. The fact that Ms Wilkinson does not have, or did not rely upon, medical expertise is not to the point. It is simply a statement by a workmate concerning difficulties which she noted Mrs Carney was having and an observation concerning employability by someone who had been a self-employed business person running a shop. There is no evidence or material contradicting what Ms Wilkinson has stated. I am at a loss as to why an insurer or trustee acting reasonably would, in effect, apparently totally ignore it.

(b)

The statement of Ms Billings is also of significance. Whilst not knowing Mrs Carney as well as Ms Wilkinson did, Ms Billings did recall her. Whilst there is some ambiguity, her amended statement would indicate that she did recall Mrs Carney being ill with breast cancer. Ms Billings stated that, if Fletcher Jones did continue to employ Mrs Carney after her breast cancer surgery, it would have been solely motivated by the desire to assist her healing process and would have been the case even if she was unable to do practically anything at all. Ms Billings took part in the retrenchment process in March 1993, she being the Human Resources Manager. Her tasks included the hiring and firing of people and the placement of injured workers. She stated that the terminations which took place in March 1993 were a result of a very different attitude by the new owner, Pelaco, and a direction towards herself and others to downsize the staff by approximately 60 people, leaving workers who were both flexible and efficient. Ms Billings can recall that amongst those in the group of 60 that were retrenched were people who were deaf and some who were wheelchair bound. Her statement concludes with the observation that she had no doubt that Mrs Carney was made redundant because of her inability to work full-time at normal duties and to be flexible and 100 per cent efficient. Whilst that last observation by her suggests speculation rather than actual recollection, the overall thrust of her statement is clear. The change in policy required Ms Billings and others to reduce the size of the workforce by retrenching a considerable number of disabled workers who had, in essence, only been kept on by what Ms Billings described as “the goodness of our corporate heart”. There was no evidence or material before the defendant disagreeing in any substantial way with the statement of Ms Billings.

(c)

Mr McCosker was the factory manager at Warrnambool leading up to and at the time of the retrenchments. He knew Mrs Carney and was aware that she suffered from breast cancer. He has stated that, as at March 1993, there were people with injuries working at Fletcher Jones, and they were people who would not be qualified or physically capable of undertaking outside employment. His statement includes reference to the fact that jobs that would otherwise not have existed were created to accommodate people and “…I wouldn’t disagree with the proposition that lots of workers including Veronica returned to work in a ‘sheltered workshop’ environment”. No statements or material disagreeing with this were before the defendant at the time of its ultimate decision. Effectively the best that Ms Neskovcin could argue was that Mrs Carney did have a job, apparently with the title of quality control inspector, and was at the end of a line. However, to my way of thinking this falls a long way short of contradicting the statements made by Mr McCosker, or by Ms Wilkinson and Ms Billings.

(d)

The defendant as trustee also had before it the statement of Ms Furnari. Ms Furnari was Mrs Carney’s supervisor at the relevant time. She knew Mrs Carney, and was aware that she had undergone surgery for breast cancer before returning to work. In that regard, she has stated as follows:

“Specifically, in relation to Veronica, I believe that as at March 1993 if she did not have the job that she did at Fletcher Jones and Staff that she would have been effectively unemployable elsewhere, and in part that was because of her illness and resultant emotional state.”
Again, the defendant did not have before it any material of substance
disputing this.

(e) Whilst not being able to comment upon Mrs Carney’s health or her general work duties on a day-to-day basis, the statement of Mr Garner, who was the warehouse and logistics manager at the relevant time, is useful in relation to the general policy prevailing. This statement, which was also before the defendant, contains the following observation:
“The company had a policy of getting people back to work as quickly as it could and would do so by bringing people back on light duties at the earliest possible opportunity. The policy was extreme in the sense that people would come back to work and basically sit there and do very little if anything…”

This was said to be due to the benevolent nature of the company prior to the change in policy. Similarly, Mr Oakley, who was the shop steward of the Clothing & Allied Trade Union at the relevant time, has described the employer, prior to the change in attitude, as being very understanding and has agreed that sometimes jobs were created to enable injured workers to return to work and that jobs were tailor made to accommodate the problems of some workers. Whilst I acknowledge that the statements of Mr Garner and Mr Oakley are more general in nature, they are confirmatory of the work processes adopted by Fletcher Jones leading up to March 1993 and provide a helpful context for the other more specific statements referred to above. Yet again, the defendant had before it nothing expressing a contrary view.

(f)

Of course, the defendant also had before it documentation previously submitted in support of the earlier claims. This material included a statement of the plaintiff taken during his wife’s lifetime on 7 October 1998. It is to be remembered that the plaintiff also worked at Fletcher Jones for a period in excess of 40 years. He has referred to the fact that Mrs Carney worked on light duties between June 1991 and March 1993, she being required to inspect garments but not to perform lifting or cutting even though she was a trained cutter. This restriction was because of her condition. He stated that, at the time that his wife was sacked, “…she was really working in a very restricted environment almost doing sheltered workshop type jobs…”. He has referred to the fact that she was sacked without explanation at the same time as some other people, and that management seemed to weed out all the people with handicaps or physical problems. The plaintiff stated that Mrs Carney had no hope of obtaining any sort of employment in the broader industrial sector and had no other skills, trade or training. The concluding paragraph of this statement is as follows:
“Her only capacity for employment prior to being sacked (was) in the very light work environment with Fletcher Jones especially made available to her. In the real world once she was put off work at Fletcher Jones there was no job that she could properly perform or for which she had any training or experience.”

In his later statement of 30 August 2006, the plaintiff has referred to the fact that, between late 1991 and Mrs Carney being made redundant in March 1993, the duties which she was performing were shared with a young woman with some sort of intellectual disability and who was also made redundant. Whilst at least the initial statement of Mr Carney is referred to by the insurer in its letter to the defendant of 1 April 2010, there is little commentary concerning it. It and the report of Dr Hall, to which I shall turn in a moment, are quoted but are effectively dismissed on the basis that, “Notwithstanding, the overall evidence also confirms that the late Mrs Carney continued to perform her light duties until having been made redundant with no evidence certifying the late Mrs Carney unfit for these duties during this period”. The defendant effectively agreed with the approach of the insurer. In its letter of 28 April 2010, the defendant essentially maintained its decision to deny the claim without specific reference to the statements of the plaintiff. In other words, basically it continued to deny the claim for essentially the same reason that it had from the beginning. There is no indication in the letter of either the insurer or the defendant that, as with all the statements of the lay witnesses, the content of the plaintiff’s statements was disputed.

(g)

The defendant also had before it the report of Dr Hall of 22 January 2010. The defendant had before it no opinion from any medical practitioner organised by it to examine Mrs Carney during her lifetime. It had no opinion from a medical practitioner or specialist who, at its request, examined and reported on all available material after her death and before the making of the ultimate decision. In short, at no time did it have before it medical material organised by it or, for that matter, by Fletcher Jones or the insurer. The only medical reports were those provided on behalf of Mrs Carney.
Returning to the report of Dr Hall, he has stated that Mrs Carney was:
“…provided with a position involving light duties which was created for her and was modified as her ability to perform those duties was progressively curtailed by her associated breast cancer symptoms.
Certainly by the time of redundancies which were made in March 1993, I believe this is supported by the investigations and the frequency of Mrs Carney’s medical visits at the time, for chest pain, headache and sciatica, that she was in no way fit to resume any sort of employment no matter how light the duties. I also believe that had Fletcher Jones not been able to provide her with a markedly modified position that she would have been deemed totally and permanently disabled years earlier. I have no doubt that she would not have been successful in finding employment following her redundancy in March 1993 due to her physical state.
…By 1993 with the loss of the very supportive and adaptable work environment provided by Fletcher Jones, further employment would have been untenable.”

This is a strong and forthright opinion which fits well with the statements of the lay witnesses and with those of the plaintiff going back to 1998, and from a member of the clinic which Mrs Carney was attending regularly at the relevant time. However, whilst the report of Dr Hall is quoted in the letter of the insurer referred to above, it is also dismissed in the same sentence beginning “Notwithstanding” as were the statements of the plaintiff. The letter of the defendant of 26 April 2010 simply refers to the report of Dr Hall without further comment. Thus, a powerful and uncontradicted report from Mrs Carney’s general practitioner was dismissed in what could be described as a fairly abrupt manner. This does not seem to me to be the conduct of a trustee acting reasonably.

(h)

The defendant had before it a number of reports from Mr Fischer, including his most recent one of 29 January 2010. Much seems to have been made of the fact that Mr Fischer did not, until 23 December 1994, write a medical certificate stating that Mrs Carney was unable to perform her normal work. However, Mr Fischer’s report of 29 January 2010 makes it clear that he is simply unable to say whether or not Mrs Carney was totally and permanently disabled in March 1993. He reports that she was clearly unable to perform her normal work. However, in his report of January 2010 as to whether she was totally and permanently disabled in March 1993, Mr Fischer has stated the following:
“This leaves the question as to whether or not Veronica was totally and permanently disabled in March 1993. To objectively answer this question you would need to talk to her employer and fellow workers. Did she perform her job at Fletcher Jones effectively? What evidence do you have that she was employed because of the benevolence of the company? These are questions for which you will have to garner the evidence in order to answer them.”

Of course, the garnering of that evidence is precisely what the plaintiff has done. When that evidence is then considered, the answers to Mr Fischer’s questions seem clear. Mrs Carney was not performing her job effectively – see the statements referred to above, and particularly that of Ms Wilkinson. There is ample evidence that she was employed because of the benevolence of the company. When all of this is considered, the ultimate report of Mr Fischer of January 2010 provides very little comfort to the defendant in relation to the submissions which it has made.
There is another feature of Mr Fischer’s last report which is worth noting. He has specifically, and quite rightly, effectively emphasised the importance of the evidence of lay witnesses such as fellow workers. As the treating surgeon, he has appreciated the importance of these witnesses. However, and interestingly, the defendant in its re- assessment of 13 April 2010 has specifically stated that statements from former employees of Fletcher Jones should not be relied upon as such people are not medically qualified to comment. Mr Fischer, who is medically qualified, seems to have a different view.
(i) Whilst it is far from conclusive, I cannot help but notice the following. In its letter of 1 April 2010 to the defendant, the insurer stated the following:
“In view of general Trustees’ responsibilities, it is important that the Trustee review the medical and other evidence and form its own view as to Mrs Carney’s claim. AMP recommends that this review be documented in the minutes of a Trustee meeting.”

That meeting seems to have occurred on 21 April 2010. It is to be recalled that, in its letter of 28 April 2010, the defendant confirmed that it had reviewed “all of the evidence relevant to this claim”, which evidence and material would be very considerable indeed. The meeting commenced at 3pm. Even if there was nothing else on the agenda (and this appears doubtful as there are in excess of three blank pages in the minutes “Claims Not Previously Considered By The Claims Review Committee – Industry” and before general business was dealt with) the fact that the meeting closed at 3.15pm is surprising. Nevertheless, the minute relating to the plaintiff’s claim, states that:
“The Claims Review Committee reconsidered all the evidence submitted and resolved that the late member did not meet the definition of Total and Permanent Disablement whilst insurance cover was in force.”

This is perhaps more relevant in relation to the disposition of this matter. However, the impression created is not exactly one of a careful approach being adopted in coming to a reasonable decision.

96 Whether or not it be described as a sheltered workshop type position, I am quite satisfied that the job that was given to Mrs Carney when she returned to Fletcher Jones after her surgery was a made-up job. On the basis of the above, I am satisfied that it was created for her because of the level of her disablement. I am also satisfied that, as stated by Ms Wilkinson who was probably in the best position to know. I am also quite satisfied that, had Mrs Carney not suffered the degree of disablement which she did, she would not have been retrenched in March 1993. I have referred above to the statement of Ms Billings in that regard, and, bearing in mind that Ms Billings almost certainly would have been involved in the process of retrenching Mrs Carney, I would repeat the statement of Ms Billings that “no doubt Veronica Carney was made redundant because of her inability to work full- time, at normal duties and to be flexible and 100 per cent efficient”. I would add that, based upon the extracts from the many lay witness statements and medical reports referred to above, I have no hesitation in finding that it was unlikely that Mrs Carney would ever be able to engage in any regular remunerative work for which she was reasonably fit by education, training or experience. In particular, I would refer again to the opinion of Dr Hall.
97 What then is to be found in the cases concerning the situation where a disabled person works on in a made-up job until retrenchment? In Baker, McDougall J stated as follows:
“It seems to me to follow almost inevitably that the Council terminated Mr Baker’s employment because it had no work for him – taking into account those limitations – to perform. To put it another way: the Council terminated Mr Baker’s employment because it had no job that he could perform. It had no job that he could perform because his physical and intellectual limitations meant that he could not do any job that, so far as the evidence goes, that Council could offer him.
The test involves direct or indirect causation. It does not specify that the relevant disabilities must be the sole cause of termination (or that termination must be solely due to those disabilities). In my view, para (a) should be construed so that, as long as the relevant disabilities are real and substantial, and not merely incidental, cause (direct or indirect) of the termination, then the pre-condition in the paragraph is satisfied.
Once that is recognised, it seems to me clear that Mr Baker’s disabilities did have that real and substantial causal relationship to the termination of his employment …
It follows that if and to the extent that the board members decided the para (a) point …, the decision which at least by inference must be taken to have been adverse to Mr Baker was one to which a reasonable person in their place and on the information available to them could not have come.”

98 The “para (a)” to which reference has been made essentially stated that the cessation of employment had to be due, directly or indirectly, to the permanent physical or mental incapacity. Clearly McDougall J formed the view that the cessation was indeed so related. Whilst the wording in the definition in the present case is different, I make a similar finding – namely that Mrs Carney’s disablement had a real and substantial causal relationship to the termination of her employment. It resulted in her being continuously absent from her employment for at least six consecutive months.
99 In Cavill Power Products the Full Court of the Supreme Court of South Australia considered a situation where a disabled diesel mechanic was provided with light duties after suffering injury. Mohr J stated as follows:
“It is clear from their evidence (the evidence of the injured person’s workshop manager and a director and secretary of the employer) that the plaintiff did not perform well at the simple clerical work provided for him and that work was “made for him”. The respondent’s “training, education and experience” is as a diesel mechanic. He has no other qualifications.
Mr Betts, a specialist surgeon, agreed with the following description of the respondent’s condition: ‘The disability as stated is severe. I also consider him totally and permanently disability from carrying out his usual occupation as a diesel mechanic. In my opinion he will not be able to do this work in the future. In fact, in his age group and with his disability I would seriously doubt whether he will be employable again in the future’.
The Learned Trial Judge in my opinion on the medical evidence before him and having regard to the limited nature of the respondent’s general education was wholly justified in coming to the conclusion that the respondent was totally disabled within the meaning attributed to that condition in the plan.”

100 Further, in Cavill Matheson J cited with approval extracts from a number of decisions including Lang v Metropolitan Life Insurance Company (1937) 2 WWR 453 where Embury J stated:
“ … I think that the effect of the medical testimony generally is that he could only perform certain light work – for example, such as that performed by a man in charge of the gates at a railway crossing. In other words (if I may use the expression) he might ‘hold down a job’ for a time, provided the job involved his doing practically no real work … For all practical purposes he is incapacitated from doing work. To exclude the plaintiff from the benefit of the policy because he could earn a living if he could obtain an improbable position which involved the doing of practically no work would in my opinion, be most unjust ... ”.

It should be said that the plaintiff in Lang had continued working on light duties after the commencement of his illness.
101 Matheson J’s ultimate conclusion was as follows:
“The medical evidence clearly supports the respondent. It is abundantly clear that the respondent is totally disabled from working as a mechanic of any kind. He is not “reasonably qualified” for any other “occupation or employment for wage or profit”. He is fit for clerical work, but is not relevantly qualified for it. There may be some light duties that the respondent could undertake, but bearing in mind his age and his disabilities, I do not consider he should be excluded from the benefits of the plan.”

102 Adopting a similar approach in the present case, it seems to me that the fact that Mrs Carney continued in a made up job until her retrenchment does not defeat her claim. Indeed, that this would be so if it was established that the job was made up was not submitted on behalf of the defendant. Rather, Ms Neskovcin argued that the job was not made up but was a real one. However, the evidence to the contrary seems to me to be almost overwhelming and, to a large extent, uncontested. If that be so and if, as I have found, it was Mrs Carney’s disablement that caused her retrenchment, it seems to me that each of the six ingredients identified by Mr Brookes have been satisfied. The plaintiff has established that Mrs Carney met the definition.
103 I might say that further general support for the conclusion at which I have arrived can be found in the cases of Hay and Nile. In Hay, which admittedly dealt with a considerably different definition, an injured person who ultimately took a voluntary redundancy and who performed some very restricted light duties thereafter was found to fall within the operation of the Trust Deed. The small amount of light work which Mr Hay performed in relation to a mail contract was found not to amount to employment “ … and could not have been seen to do so, being at most analogous to work in a sheltered workshop”. Interestingly, Burchett AJ also referred to the decision of Hunter J in Willie v National Mutual Life Association of Australasia Ltd (18 April 1997, BC 9703063 where His Honour said:
“There may be circumstances which dictate consideration of employment less than full-time employment. That is not the case here and, in any event, I am satisfied that the plaintiff’s incapacity falls squarely within the total and permanent disablement provision of the policy. I have no doubt that what full-time work the plaintiff has performed has been done with significant imperfections and was wholly dependent upon the goodwill or charity of his employer.”

104 Hunter J went on to make a similar remark about the plaintiff’s “present part- time employment”. In Hay, Burchett AJ stated as follows:
“The decision on the third occasion, having regard to all of the material, and it was ample, that was by then available to the trustee, can only be described as one to which no reasonable trustee could have come. It is not simply that the material permitted alternative views, of which that taken by the trustee was by far the inferior. The decision was simply so contrary to the great preponderance of evidence as to be unreasonable in the relevant sense.”

105 Preponderance of evidence in the present case seems to me to lead to a similar conclusion.
106 The decision in Nile is of interest because of the failure of the trustee to consider certain aspects of the evidence placed before it. In this regard, Brownie AJ stated as follows:
“I do not mean to suggest that the second defendant should have accepted all that the plaintiff said, or all that the doctors who supported him said, but I do think that the reasons given by the second defendant demonstrate that it did not approach the matter in the appropriate way. It did not purport to weigh the significance of what the plaintiff had said, and consider whether that material undermined or in any way affected the opinions of Drs Innes-Brown and Funnell; and it did not, it appears, give any consideration to the new reports of other doctors furnished by the plaintiff’s solicitors.”

107 Of course, in the present case the defendant did not organise or provide medical material conflicting with the views expressed by, for example, Dr Hall. As was said by Bryson J in Sayseng referring in turn to the decision in Rapa:
“ … an unreasonable conclusion cannot be reached without either a failure to exercise power in good faith, or a failure to exercise the power upon real and genuine consideration, or a failure to exercise the power in accordance with the purposes for which it was conferred.”

108 In Telstra Super Pty Ltd v Flegeltaub (2000) 2 VR 276, Callaway JA stated:
“In the case of an obligation to form an opinion, a court may infer a breach of duty if the decision is one which no reasonable trustee could make on the material which was before it.”

109 In the present case, whilst the failure to exercise the power upon real and genuine consideration was not the central thrust of the plaintiff’s case, it was a pleaded particular and is, as referred to above, a potential ingredient of an unreasonable decision. Accordingly, the observations contained in Nile can be of some additional assistance.
110 The next question is, bearing in mind the above, whether, on the basis of the available material and information, a reasonable trustee could have arrived at the decision which the defendant made. In my opinion, it could not. I have already set out details of the material available to the defendant and which I consider to be close to overwhelming and largely uncontested in relation to the conclusions which I have reached. A trustee acting reasonably should have arrived at the conclusion that Mrs Carney had a level of disablement which met the definition and that she was disabled prior to her retrenchment, which was caused by that disablement. It should then have found that she was continuously absent from her employment for at least six consecutive months prior to her 60th birthday, and that this resulted from the relevant injury or illness. If deciding reasonably, it should have found that she was unlikely to ever be able to engage in any regular remunerative work for which she was reasonably fitted by education, training or experience. Certainly the report of Dr Hall supports this position. The material from the lay witnesses, including the plaintiff, leads to such a result. Mr Fischer is at best non- committal in relation to the situation in March 1993, but his views as to subsequent total and permanent disablement are clear. When all of the material before the defendant at the relevant time is considered and weighed, the conclusion must, or should, have been that each ingredient, including that of the unlikelihood of Mrs Carney ever to be able to engage in any regular remunerative work as defined, was satisfied. In my opinion the plaintiff has discharged the burden of proof in this regard. The decision of the defendant was one at which no reasonable person or trustee could have arrived.

Disposition of the matter
111 The question of the relief which should be afforded the plaintiff remains. As was stated by Ms Neskovcin, it is difficult to point to any clear guidelines in this regard. In the present case, I am of the view that the claim should not be remitted to the defendant as trustee and that the court should exercise its discretion. I am of that view for the following reasons:

(a) I have found that the defendant arrived at a decision at which no trustee acting properly and reasonably could have arrived. I would refer to the following remarks of McDougall J in Baker:
“The general rule is that when a trustee’s decision is fundamentally flawed, it is in law no decision at all. In normal circumstances the court will not itself exercise the discretion, but will remit the matter to the Trustee to be considered on a proper basis. See Bryson J in Sayseng at [73]. However, I think that cannot be the case where (as I have found) no reasonable person, applying the correct test to the material before the Trustee, could have reached the conclusion that the Trustee did. In those circumstances, reconsideration would be futile.”

In Flegeltaub v Testra Super Pty Ltd [2000] VSC 107, Byrne J stated as follows:
“The cases show that the court may and will itself execute the trusts and determine the entitlement of the claimant to a benefit where there is good reason to believe that the trustee would not itself do so or where the material before the trustee was such that there could be no debate about the entitlement of the claimant.”

Byrne J also referred to the decision in Rapa where it was said that:
“The Court may in a proper case execute the trust by
substituting its own discretion for that of the trustees.”

Given the nature of the finding which I have made, namely that no reasonable trustee applying the correct test to the material could have reached the conclusion which it did, I am of the view that reconsideration by the defendant would be futile.

(b)

I am reinforced in this view by an examination of the history of events. Mrs Carney first made a claim on 24 November 1994, this being rejected on 24 July 1995. The claim was rejected essentially on the basis that Mrs Carney had been made redundant and retrenchment was the reason for her leaving work. Mrs Carney’s solicitors responded with a lengthy letter setting out various details and submitting that her retrenchment was directly linked to her illness. A review was sought. That review, sought by way of a letter of 11 October 1995, represents the second claim. The response, on 24 October 1995, was to the effect that a valid claim did not exist. Fresh medical evidence showing that Mrs Carney was unlikely to ever engage in work for reward in any occupational work for which she was reasonably qualified was sought. Accordingly, a report from Mr Fischer was provided on 22 January 1996, such report concluding that Mrs Carney was not able to hold down a permanent job and that her education extended to second form level so that she would only be suitable for some sort of manual work. There was reference in such report to the fact that she could not do such things as wash a window or make a cake and that she had persistent pain which she found incapacitating. The review sought in the letter of 22 January 1996 is the third claim. Like the second claim, it was rejected. As with the second claim, the rejection again referred to redundancy and the fact that retrenchment was the reason for ceasing work. The rejection of the third claim also contained the assertion that Mrs Carney was fit for work that did not involve repetitive use of her right arm.
The fourth claim was made on 16 May 2006. A further report from Mr Fischer (dated 24 April 2006) was supplied. This claim provoked several reconsiderations before its ultimate rejection. During the process of those reconsiderations, further material was provided by the plaintiff. Upon each reconsideration, the claim was again rejected. Reconsiderations or reassessments which took place on 13 June 2007 and 31 October 2007 in essence provided no new reasons for the rejection of the claim. Further material, including the lay witness statements and the report of Dr Hall, was supplied in January 2010. A reassessment by the defendant was carried out on 13 April 2010. The claim was again rejected, and the reasons were basically the same despite the lay witness evidence and the report of Dr Hall. Whilst it is somewhat confusing, a review then seems to have been carried out on 21 April 2010 and the claim was again rejected.
In summary, the defendant has, in one form or another, decided and reviewed this claim on many occasions since 1994. Further material has been supplied to it, but its position has never altered. Its emphasis on retrenchment has persisted. Given the history of events and the defendant’s response to the additional material supplied, I have absolutely no reason to be confident that the defendant would exercise its duty as trustee in a proper and reasonable manner should the claim be before it again.

(c)

I am further reinforced in what I perceive to be the futility of remitting this matter to the defendant by the minutes of the meeting of 21 April 2010 when this claim was, apparently, last before it. I have already commented upon the volume of material which was allegedly before it and the apparent speed of the entire meeting. It may be that I am reading too much into it, but the speed with which this claim was ostensibly reconsidered does little to instil confidence that remitting would not be futile. Rather, apparent futility is underlined.
112 In summary, I am not of the view that this matter should be remitted to the defendant for further consideration. Given all that has occurred, the risk of such remitting being futile seems far too high. Accordingly, this seems to me to be one of those cases where the court should exercise the discretion which normally reposes upon the trustee.

Conclusion
113 The plaintiff has been successful. The burden of proof has been discharged. In exercising my discretion, I determine that Mrs Carney satisfied the definition of total and permanent disablement within the meaning of the Trust Deed and that the plaintiff is entitled to be paid the relevant amount. This is alleged to be $30,000. The quantum of this amount has not been disputed. I appreciate that arguments concerning interest have been raised. I shall hear the parties as to any ancillary orders that are required including those in relation to both interest and costs.

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[2010] VCC 583

10 June 2010