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Carroll v United Super Pty Ltd

Carroll v United Super Pty Ltd

Case [2018] NSWSC 403 4 April 2018

Utmost Good Faith

Breach of Contract

Utmost Good Faith in Insurance

Compensatory Damages

Total and Permanent Disablement

Insurance Law

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Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: Carroll v United Super Pty Ltd [2018] NSWSC 403
Hearing dates: 7, 8, 9, 23, 24 and 25 November 2016, 2, 6 December 2016, 17 February 2017
Date of orders: 04 April 2018
Decision date: 04 April 2018
Jurisdiction: Equity
Before: Slattery J
Decision:
See paragraphs 279 – 281

Catchwords: INSURANCE – General – total and permanent disablement – plaintiff/insured self-employed in the building and construction industry – plaintiff suffers hip disability and ceases work in March 2012 – plaintiff a member of an industry superannuation fund – first defendant is a trustee of the fund – first defendant takes out a policy of insurance for the benefit of members of the fund with the second defendant insurer – plaintiff claims he is totally and permanently disabled after being off work for three months and entitled to a benefit for the same – the first and second defendants decline the plaintiff’s claim on various dates between June 2013 and April 2014 – identification of the duties applicable to each of the first and second defendants in making their decisions to decline the plaintiff’s claim – whether the first defendant trustee failed to act in good faith on a real and genuine consideration of the material before it – whether the second defendant insurer acted with the utmost good faith in dealing with the plaintiff’s claim and reasonably in forming an opinion as to whether the plaintiff qualified as totally and permanently disabled under the policy – whether the defendants’ respective decisions can be set aside – whether the Court should itself determine whether the plaintiff is totally and permanently disabled under the policy – whether the plaintiff was “unlikely to ever to be able to engage in any regular remuneration work for which he is suited by education training or experience”.
Cases Cited: Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223
Banovic v United Super Pty Ltd [2014] NSWSC 1470 Beverly v Tyndall Life Insurance Co Ltd (1999) 21 WAR 327
Birdsall v Motor Trades Association of Australia Superannuation Fund Pty Ltd [2015] NSWCA 104
Chammas v Harwood Nominees (1993) 7 ANZ Ins Cas 61-175
CGU Insurance Ltd v AMP Financial Planning Pty Ltd (2007) 235 CLR 1
Dewhirst v Edwards [1983] 1 NSWLR 34
Edwards v The Hunter Valley Co-op Dairy Co Ltd (1992) 7 ANZ Ins Cas 61-113
Erzurumlu v Kellogg Superannuation Pty Ltd [2013] NSWSC 1115
Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89
Finch v Telstra Super Pty Ltd (2010) 242 CLR 254
Halloran v Hardwood Nominees Pty Ltd [2007] NSWSC 913
Hannover Life Re of Australasia Ltd v Colella (2014) 47 VR 1
Hannover Life Re of Australasia Ltd v Dargan (2013) 83 NSWLR 246
Hannover Life Re of Australasia Ltd v Jones [2017] NSWCA 233
Hannover Life Re of Australia Ltd v Sayseng [2005] NSWCA 214
Jones v United Super Pty Limited [2016] NSWSC 1551
Lazarevic…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Carroll v United Super Pty Ltd

Details

AGLC: Carroll v United Super Pty Ltd [2018] NSWSC 403
Case: [2018] NSWSC 403
Decision Date: 04 April 2018

CaseChat Overview and Summary

The case of Carroll v United Super Pty Ltd involved the plaintiff, a self-employed carpenter in the building and construction industry, who suffered a hip disability and ceased work in March 2012. The plaintiff claimed total and permanent disablement and entitlement to a benefit under a policy of insurance taken out by United Super Pty Ltd, the trustee of an industry superannuation fund, with the second defendant, the insurer. The defendants declined the plaintiff’s claim on various dates between June 2013 and April 2014, leading to this legal dispute.

The central legal issues in the case were whether the first defendant, as trustee, failed to act in good faith or on a genuine consideration of the material before it, and whether the second defendant, as insurer, acted with the utmost good faith and reasonably formed an opinion on the plaintiff’s eligibility for a disability benefit. The court was also tasked with determining whether the decisions of the defendants could be set aside and whether the court itself should determine the plaintiff’s entitlement to a benefit under the policy.

The court found that the first defendant trustee did not act in good faith and on a genuine consideration of the material before it. The court concluded that the trustee failed to properly consider the plaintiff’s submissions and evidence, particularly in relation to the plaintiff’s inability to engage in regular remuneration work. The court also found that the second defendant insurer acted unreasonably in forming an opinion that the plaintiff did not qualify for a total and permanent disablement benefit. The insurer did not adequately consider the plaintiff’s submissions and evidence, and its decision was influenced by an incorrect assumption that the plaintiff could return to work. The court concluded that both defendants’ decisions could be set aside.

The court ordered that the decisions of the first and second defendants to decline the plaintiff’s claim be set aside and that the matter be remitted to the defendants for reconsideration in light of the court’s findings.

Orders