Folmer v VicSuper Pty Ltd

[2018] NSWSC 1503

Supreme Court

New South Wales

Medium Neutral Citation:

Folmer v VicSuper Pty Ltd & Anor [2018] NSWSC 1503

Hearing dates:

27 – 28 June 2018

Date of orders:

10 October 2018

Decision date:

10 October 2018

Jurisdiction:

Equity

Before:

Hallen J

Decision:

The Court:

(a) Directs the parties to bring in Short Minutes of Order to give effect to these reasons.

(b) Lists the proceedings for mention for any argument on interest, costs, or other consequential issues, on a date to be arranged at the date of the publication of these reasons.

(c) Grants liberty to apply.

Catchwords:

INSURANCE — TPD insurance — Plaintiff was member of superannuation fund — Trustee of fund (first Defendant) effected Group policy insurance — Insurance policy with Insurer (second Defendant) — Insurance providing benefits upon total and permanent disablement of member — Plaintiff claims she is totally and permanently disabled after being off work for six months — Trustee declined the Plaintiff's claim — Duty on a trustee of a superannuation fund in determining a claim for a total and permanent disablement benefit — Whether Trustee breached obligations to Insured — Plaintiff not pursuing claim against Trustee by end of the hearing, accepting claim against Trustee to be dismissed

 

INSURANCE — Where contract of insurance — Where Plaintiff claimed that she had suffered total and permanent disablement — Whether totally and permanently disabled benefit payable if Insured proved to the satisfaction of Insurer that she was so incapacitated as to be “unable ever again to work for reward in any business, occupation, or regular duties for which she is reasonably qualified by education, training or experience” — Where insurer denied claim on the basis the claim did not satisfy the definition of TPD — Whether Insurer acted reasonably in considering the claim — Utmost good faith — Whether Insurer breached duty of utmost good faith and fair dealing — Whether Plaintiff totally and permanently disabled within the meaning of the relevant insurance policy — Plaintiff challenges decisions of the Insurer

  INSURANCE — Standard of review adopted by Court — Whether Insurer could reasonably have reached the conclusions it did on the evidence available to it — Whether opinion open to Insurer acting reasonably and fairly on the material before it — Whether Plaintiff was totally and permanently disabled at the assessment date

Legislation Cited:

Civil Procedure Act 2005 (NSW)
Life Insurance Act 1995 (Cth)
Superannuation Industry (Supervision) Act 1993 (Cth)

Cases Cited:

Alcoa of Australia Retirement Plan Pty Ltd v Frost (2012) 36 VR 618; [2012] VSCA 238
Baker v Local Government Superannuation Scheme Pty Ltd [2007] NSWSC 1173
Benn v New South Wales [2016] NSWCA 314
Beverley v Tyndall Life Insurance Co Ltd (1999) 21 WAR 327; [1999] WASCA 198
Birdsall v Motor Trades Association of Australia Superannuation Fund Pty Ltd (2015) 89 NSWLR 412; [2015] NSWCA 104
Board of Trustees of the State Public Sector Superannuation Scheme v Gomez [2018] QCA 67
Carroll v United Super Pty Ltd [2018] NSWSC 403
CGU Insurance Ltd v AMP Financial Planning Pty Ltd (2007) 235 CLR 1; 81 ALJR 1551; [2007] HCA 36
Cigna Life Insurance New Zealand Ltd v Rowles (High Court (New Zealand), Ellis J, 2 May 1997, unrep)
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
Finch v Telstra Super Pty Ltd (2010) 242 CLR 254; [2010] HCA 36
Gilberg v Maritime Super Pty Ltd [2009] NSWCA 325
Halloran v Harwood Nominees Pty Ltd [2007] NSWSC 913
Hannover Life Re of Australasia Ltd v Dargan (2013) 83 NSWLR 246; [2013] NSWCA 57
Hannover Life Re of Australasia Ltd v Jones [2017] NSWCA 233
Hannover Life Re of Australasia Ltd v Sayseng (2005) 13 ANZ Ins Cas 90-123; [2005] NSWCA 214
Hellessey v MetLife Insurance Limited [2017] NSWSC 1284
Ivkovic v Australian Casualty & Life Ltd (1994) 10 SR (WA) 325
Jones v United Super Pty Limited [2016] NSWSC 1551
Manglicmot v Commonwealth Bank Officers Superannuation Corporation Pty Ltd [2011] NSWCA 204; (2011) 282 ALR 167
McArthur v Mercantile Mutual Life Insurance Co Ltd [2002] 2 Qd R 197
Minister for Immigration & Citizenship v Li (2013) 249 CLR 332; [2013] HCA 18
MX v FSS Trustee Corporation as Trustee of the First State Superannuation Scheme [2018] NSWSC 923
National Mutual Life Association of Australasia Limited, the application of National Mutual Life Association of Australasia Limited and AMP Life Limited (No 2) [2016] FCA 1591
Newling v FSS Trustee Corporation (No 2) [2018] NSWSC 1405
Nile v Club Plus Superannuation Pty Ltd [2005] NSWSC 55
Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589; [1981] HCA 45
Renard Constructions (ME) Pty Ltd v Minister for Public Works (1992) 26 NSWLR 234
Sayseng v Kellogg Superannuation Pty Ltd [2007] NSWSC 583
Shuetrim v FSS Trustee Corporation [2015] NSWSC 464
TAL Life Ltd v Shuetrim; MetLife Insurance Ltd v Shuetrim (2016) 91 NSWLR 439; (2016) 332 ALR 507; [2016] NSWCA 68
van der Noll v Sovereign Assurance Co Ltd [2013] NZHC 3051
White v Overland [2001] FCA 1333
White v The Board of Trustees [1997] 2 Qd R 659
Ziogos v FSS Trustee Corporation as Trustee of the First State Superannuation Scheme [2015] NSWSC 1385

Texts Cited:

W I B Enright and R M Merkin, Sutton on Insurance Law (4th ed, 2015, Thomson Reuters), Vol 2

Category:

Principal judgment

Parties:

Susan Jane Folmer (Plaintiff)
VicSuper Pty Ltd (first Defendant)
AMP Life Ltd (second Defendant)

Representation:

Counsel:
Mr A Coombes (Plaintiff)
Mr C Hanson (Defendants)

  Solicitors:
Firths The Compensation Lawyers (Plaintiff)
HWL Ebsworth Lawyers (Defendants)

File Number(s):

2017/117269

Judgment

Introduction

1. HIS HONOUR: This case is another sad illustration of a dispute that has arisen between the insured, on the one hand, and the trustee of a superannuation fund, and the insurer on risk, on the other, in relation to the entitlement of the insured to benefits, in circumstances where the question whether she became totally and permanently disabled (“TPD”) within the meaning of that term in the policy of insurance and/or under the trust deed of the superannuation fund has been debated. (As will be read, the claim against the insurer, now, is the only part of the claim that is to be determined in the proceedings.)

2. The Plaintiff, Susan Jane Folmer, commenced working with Aspire Mental Health Service ("the Employer"), as a community development officer and counsellor, sometime in late 2007. She ceased working with the Employer on either Friday, 25, or Monday, 28, January 2008. She claimed that she has been unable to work since then; that she will never work again; and that, as a result, she is entitled to a TPD benefit that has not been paid to her. She seeks an order that the insurer is required to pay the TPD benefit provided for in the policy to the trustee for her benefit and that it be paid to her.

3. VicSuper Pty Limited, the first Defendant (“the Trustee”), is the trustee of the Victorian Superannuation Fund (“the VS Fund”) constituted by a Trust Deed, relevantly dated 30 May 2013 (“the Trust Deed”), which provided for certain benefits including, in certain events, a TPD benefit, to members of the VS Fund. It exercised its trustee functions pursuant to the Trust Deed, as amended from time to time.

4. The National Mutual Life Association of Australasia Limited (“NMLA”), the corporate predecessor of AMP Life Limited, the second Defendant (“the Insurer”), had entered into a Group Life Death, TPD & TTD (Superannuation) Insurance Policy, bearing Policy number GL 21297 (“the Policy”) with the Trustee. (TTD is “total and temporary disability” and is not the subject of any claim in these proceedings.) The Policy was effective from 1 February 2001.

5. On 12 December 2016, the relevant life insurance business of NMLA was transferred to the Insurer (which was then also a life insurer) pursuant to s 194 of the Life Insurance Act 1995 (Cth), under a scheme approved by the Federal Court of Australia, such that the Insurer, thereafter, held the rights and obligations of NMLA under the Policy. Importantly, the Insurer also assumed the liabilities of NMLA under the Policy. Another consequence was that the rights, benefits and liabilities of an owner of a policy with NMLA and of all persons claiming through, or under them, would be the same, in all respects, as they would have been if the Policy had been issued, or entered into, by the Insurer instead of NMLA: National Mutual Life Association of Australasia Limited, the application of National Mutual Life Association of Australasia Limited and AMP Life Limited (No 2) [2016] FCA 1591.

6. Pursuant to the Policy, in return for the Trustee agreeing to make certain payments to the Insurer, the Insurer agreed to insure members of the VS Fund against, amongst other things, TPD and TTD. Relevantly, and in general terms, the Policy provided that in the event that a member of the VS Fund to whom the Policy extended cover became TPD, the Insurer would pay the Trustee a “TPD Benefit”.

7. The TPD benefit applicable to the Plaintiff’s claim in the present case is $90,000.

8. The Plaintiff became a member of the VS Fund on 21 September 2007 as an incident of her employment with the Employer. She paid premiums under the Policy from the date she joined the VS Fund so that she would be eligible for benefits from the Fund in the event that she became TPD. Insurance cover became effective as soon as she joined the VS Fund. Her insurance cover remained in force until 17 March 2010.

Overview of the Claim

9. By way of brief overview, which will be expanded later in these reasons, I set out the broad chronology set out by counsel for the Plaintiff in relation to the claim for payment of a TPD Benefit.

10. On about 15 October 2014, the Plaintiff lodged a claim (“the Claim”) with the Trustee for payment of a TPD benefit under the Policy. The Trustee, in turn, lodged the Claim with the Insurer, on about 5 January 2015 (Ex. A/202).

11. On 31 May 2016, the Insurer sent a “procedural fairness” letter to the Plaintiff’s solicitors. On 16 March 2017, the Trustee declined the Plaintiff’s claim. On a date, or dates, the subject of dispute, the Insurer declined the Plaintiff’s claim. On 27 September 2017, the Insurer provided reasons for declinature. On 5 December 2017, and on 8 January 2018, the Plaintiff requested the Defendants to reconsider the declinature of her claim. On 16 February 2018, the Insurer again declined the Plaintiff’s claim. On 19 March 2018, the Plaintiff again sought reconsideration of the declinature of her claim.

12. At the date of the hearing, neither the Trustee, nor the Insurer, had taken any steps to further reconsider the Plaintiff’s claim: see, Paragraph 7 of the Plaintiff’s written Outline of Submissions. However, the Plaintiff later informed both that she did not wish her claim to be reconsidered again.

The Proceedings

13. On 19 April 2017, the Plaintiff commenced the proceedings by Statement of Claim, against the Trustee, which was named as the first Defendant, and against NMLA, which was named as the second Defendant.

14. The Plaintiff’s Statement of Claim was amended on 17 May 2017, by changing the name of the second Defendant from NMLA to the Insurer. It was amended again, with the leave of the Court, by a further amended Statement of Claim filed on 18 June 2018.

15. At the commencement of the hearing, the Court was referred to the amended Statement of Claim, the Defence to the amended Statement of Claim filed by the Trustee on 27 June 2018 and the Defence to the amended Statement of Claim by the Insurer, also filed on 27 June 2018.

16. A two volume Court Book was marked tendered and marked Ex. A: T2.21 – T2.36. The Exhibit comprised about 780 pages, and included a copy of the pleadings and particulars, the Policy, the Claim documents, the affidavits of the Plaintiff, the correspondence, the medical evidence “on the first consideration”, the medical evidence “on the first requested re-consideration”, the medical evidence “on the second requested re-consideration”, and various miscellaneous documents (to some of which no reference was made).

17. There is no dispute that if the Plaintiff succeeded in her claim, the Court should make orders in terms that are appropriate to ensure that she receives the benefits to which she is entitled.

18. The Court is grateful for the orderly conduct of the hearing and the assistance provided by the legal representatives of each of the parties.

The Issues raised in the Pleadings

19. In broad summary, the Plaintiff asserted that, as a result of her disabilities, she had not worked since ceasing work with the Employer on 25 (or 28) January 2008. She claimed to have qualified as being TPD, within the provisions of the Policy as she “has been continuously unable to work because of injury of illness for the TPD Waiting Period” and because she “is unable ever again to work for reward in any business, occupation, or regular duties for which she is reasonably qualified by education, training or experience”.

20. As against the Trustee, the Plaintiff asserted that it “was under a duty to do everything that was reasonable to pursue an insurance claim for the benefit of the Plaintiff, if the claim has reasonable prospects of success”. She relied on s 57(2)(d) of the Superannuation Industry (Supervision) Act 1993 (Cth) (“the SIS Act”). She also asserted that the Trustee had “failed to do everything that was reasonable to pursue the Plaintiff’s claim”, in that it failed “to form an opinion that the Plaintiff’s claim against the [Insurer] has a reasonable prospect of success”; that the Trustee had failed to “commence proceedings against the Insurer” and that it had failed “to take over the claim or these proceedings against the Insurer”.

21. In the Plaintiff’s written submissions, counsel contended that the Plaintiff was the only beneficiary of the fund who had (or could have) an interest in any right of action that the Trustee had against the Insurer in connection with the Claim made by the Plaintiff for payment of the TPD benefit under the Policy held by the Trustee with the Insurer. Accordingly, the Trustee had a duty to protect the interests of the Plaintiff in respect of the Claim under the Policy. That included considering whether the Insurer’s decisions to decline the Claim were made in breach of the Insurer’s duty to the Plaintiff.

22. Importantly, then, whilst acknowledging that the Trustee had an obligation, under the Deed of Trust, to form its own opinion as to whether the Plaintiff was “Disabled”, and accepting that, in March 2017, it had declined the Plaintiff’s claim for payment of the TPD Benefit from the Fund, she did not challenge that declinature in these proceedings. Accordingly, the Trustee’s decision to the decline the Claim was not the subject of challenge.

23. Almost at the conclusion of the final oral submissions made by counsel for the Defendants, the Court enquired of counsel for the Plaintiff whether the Plaintiff was pursuing the claim against the Trustee (principally because no oral submissions had been made about it). After obtaining instructions, counsel answered that the Plaintiff did not intend to press the claim brought against the Trustee and accepted that proceedings against the Trustee should be dismissed: T132.35 – T132.46. Accordingly, the lines of defence adumbrated by the Trustee in the pleadings were abandoned. It is, therefore, unnecessary to refer, further, to the allegations made against the Trustee, or its defences, unless relevant to the remaining issues to be decided.

24. In relation to the Insurer, the Plaintiff challenged the Insurer’s decisions to decline her claim for the TPD Benefit under the Policy, asserting that each of its decisions was “wrong in law”; she sought a declaration that she “satisfies the definition of TPD in the Policy”; she sought an order that the Insurer pay to the Trustee, in trust for her, the defined TPD benefit of $90,000; she sought an order that the Trustee pay the defined TPD benefit to her “subject to applicable taxes”; and she sought an order for interest and for costs.

25. By the further amended Statement of Claim, the Plaintiff added a reference to a decision by the Insurer on 27 September 2017; the request for reconsideration of that decision by request made on 5 December 2017, and, again, on 8 January 2017; the further decision to decline the claim on 16 February 2018; another request for reconsideration on 19 March 2018, and the subsequent non-acceptance by the Insurer.

26. The Plaintiff asserted that in “failing to make a decision to pay the Plaintiff’s claim, and then declining the claim, on each occasion it did so, [the Insurer] acted in breach of its duties”. The particulars of her claim against the Insurer were:

“24.1   Failing to consider and determine the Plaintiff’s claim within a reasonable time.

24.2   Failing to act with fair dealing.

24.3   Failing to act reasonably in considering the Plaintiff’s claim.

24.4   Failing to properly assess the Plaintiff’s claim.

24.5   Failing to form an opinion based on a real and genuine consideration of the evidence.”

27. The Plaintiff asserted a loss, as against the Insurer, being the insured TPD benefit of $90,000 and interest.

28. The Insurer, in its verified Defence, denied that the Plaintiff was entitled to any relief as claimed, or at all.

29. In summary, the Plaintiff set out the following issues for the Court’s consideration:

1. In declining the Plaintiff’s claim on any of the occasions on which it did so, did the Insurer breach its duty and obligations to the Plaintiff?

2. In failing to reconsider the Plaintiff’s claim in the period 19 March 2018 to date, did the Insurer breach its duty and obligations to the Plaintiff?

3. Is the Plaintiff TPD for the purposes of the Policy?

30. There was no dispute raised that, if the Plaintiff met the terms and conditions for the payment of a TPD benefit, she was entitled to the TPD Benefit of $90,000 under the Policy. It was also accepted by the Insurer that she was entitled to interest, but the question, then, would be the date from which interest would be calculated: T18.22 – T18.29.

31. There was also no dispute that a member of a superannuation fund in respect of whom the Trustee has obtained insurance cover had standing to seek an order that the Insurer pay the Trustee the amount due to the Trustee under the contract of insurance: Erzurumlu v Kellogg Superannuation Pty Ltd [2013] NSWSC 1115, at [54]. It was accepted that the member had standing to bring a claim under the Policy against the Insurer, even though it was a Group Life Policy.

An Issue arising at the Hearing

32. At the commencement of the hearing, before the opening address by counsel for the Plaintiff, counsel for the Defendants raised some issues regarding the Plaintiff’s claim: T3.04 – T6.39.

33. Counsel stated that there were three matters in the written submissions filed for the Plaintiff that had not been pleaded, that had not been pursued during the course of the preparation of the proceedings, and that were not identified, other than in the written Outline of Submissions served shortly before the hearing.

34. The first issue raised was that the Plaintiff sought to mount a case against the Insurer, for “constructive denial” (as referred to in Paragraphs 8(b), 28 and 31 to 36 of the Plaintiff’s submissions). The second was that the Plaintiff sought to assert that the Insurer had not given reasons (as referred to in the submissions at Paragraphs 38 to 41). The third was that the Plaintiff claimed a right to pursue the Trustee in respect of the denial of the Plaintiff's claim separately from these proceedings (as referred to, at Paragraph 13 of the written submissions).

35. In relation to the first and second issues, counsel for the Insurer submitted that the Insurer had not been given an opportunity to consider the evidence that was required to be gathered, and relied upon, with the result that it would be significantly prejudiced if the Plaintiff was allowed to raise either, or both, of the issues, so late in the proceedings, without having pleaded them.

32. In relation to the second issue, in addition to prejudice, counsel submitted “there’s just no utility in a constructive denial argument in this trial”: T5.21 – T5.22. On the issue of prejudice if such a claim was permitted to be made, he added that there was evidence of reasons having been given by the Insurer to the Trustee, and that if the Trustee had not provided those reasons to the Plaintiff, that failure might raise a conflict between the two Defendants that had not been considered and that could not be resolved at this late stage of the proceedings.

33. In relation to the third issue, counsel pointed to Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589; [1981] HCA 45, and submitted that the Plaintiff may be estopped from pursuing the Trustee in respect of the denial of the Plaintiff’s claim in the future: T6.14 – T6.39.

34. In relation to the first issue, counsel for the Plaintiff accepted that no relief had been sought in the further amended Statement of Claim that specifically addressed the claim of constructive denial and that, strictly, the Plaintiff did not need to rely on a constructive denial, but that it might be necessary for the Court to consider the point otherwise: T7 – T8.

35. In relation to the second issue, counsel for the Plaintiff submitted that a failure to give reasons is, at most, a particular of a breach of the Insurer's duty of utmost good faith, and even if it were not pleaded as such, it was a matter of which the Insurer was acutely aware of the assertion made against it well before the hearing, as the Plaintiff’s solicitors had referred to such a complaint in a letter dated 27 September 2017, which was in evidence, and upon which the Insurer itself was relying.

36. This issue was abandoned after counsel for the Plaintiff called on a notice to produce, returnable on 25 June 2018, and when counsel for the Defendants produced a copy of the document sought in that notice to produce, and enabled the inspection of that document. The copy document that was produced, and which was inspected, was subsequently tendered and formed part of Ex. A: Ex. A/243(a) – (d). It was headed “TPD Final Summary dated 23/11/2016”. This document was said to have been accepted as the first decision and the reasons provided by the Insurer to the Trustee for declining the Plaintiff’s claim. (It will be referred to in some detail later in these reasons.)

37. In relation to the third issue, counsel for the Plaintiff clarified that the proposition raised in the written submissions was not that the Plaintiff was going to commence separate proceedings against the Trustee seeking to traverse the decision already made by it to decline the Claim, but that if the Court were persuaded by the Plaintiff's case against the Trustee and there were a declaration made to the effect that the Plaintiff is TPD for the purposes of the Policy, it would become necessary for the Trustee to revisit its initial decision to decline the claim, and, at that point, the Plaintiff would, if necessary, traverse any further decision that might be made by the Trustee.

38. This issue evaporated when counsel for the Defendants stated that any such action by the Plaintiff would be “entirely unnecessary” as if the Trustee received the TPD Benefit from the Insurer, it would forward the money to the Plaintiff: T17.14 – T17.29.

39. The parties were informed of the Court’s ruling after the submissions had been made. In relation to the remaining first issue, I concluded that the Plaintiff should not be permitted to raise it so late, and through the door of written submissions, when it had not been pleaded, or otherwise brought to the attention of the Insurer, that such a claim would be made. To do otherwise would not facilitate the overriding purpose of the just, quick and cheap resolution of the real issues in the proceedings, would contravene the objects of case management set out in s 57 of the Civil Procedure Act 2005 (NSW) and would not follow the dictates of justice as required by s 58(1) of the Civil Procedure Act, having regard to the matters referred to in s 58(2).

40. During the course of the argument, the Court referred, amongst other matters, to what Allsop J (as his Honour then was) had written in White v Overland [2001] FCA 1333, at [4], by way of general principle, namely that:

“[I]n the efficient and proper conduct of civil litigation, even civil litigation hard fought between parties, it should always be recognised that in the propounding of issues for trial the parties should take steps to ensure that all relevant parties to the dispute are cognisant of what the issues are. Any practice of quietly leaving footprints in correspondence or directions hearings to be uncovered some time later in an attempt to reveal that a matter was always in issue should be discouraged firmly.” (Emphasis in original.)

45. (What had been written by Allsop J has been referred to, on many occasions, in this Court, including, relatively recently, by the Court of Appeal, in Benn v New South Wales [2016] NSWCA 314, at [62], per Gleeson JA, with whom Meagher JA and Johnson J agreed.)

The Hearing

46. Only the Plaintiff was cross-examined. She had relied upon an affidavit sworn on 23 August 2017, and another sworn on 26 October 2017, a copy of each of which had been included in the Court Book and which were read in the proceedings.

47. No submission was made by counsel for the Defendants concerning the reliability, or otherwise, of her evidence.

48. Following the cross-examination of the Plaintiff, counsel made submissions.

Uncontroversial History

49. It is next necessary to set out the factual basis underlying the Plaintiff’s claim. At least some of the facts asserted in the Plaintiff’s affidavits, in her oral evidence, and in the documents included in the Court Book, were not the subject of any dispute. What follows is the broad factual background taken from the evidence. To the extent that any facts set out are in dispute, they should be regarded as findings of the Court.

50. The Plaintiff was born in January 1971 and is, currently, 47 years old. She is not married and she has no children.

51. There was no evidence given of her remaining expected working life at the time she ceased working with the Employer on 25 (or 28) January 2008. However, at that time, she was 37 years old, so one might expect that she had a reasonably long working life ahead of her.

52. Despite having left school at the age of 15 years, the Plaintiff was, at the date of hearing, very well educated and trained, having undertaken Commerce Studies with Launceston College of TAFE in Tasmania (about 1991); an Associate Diploma of Social Science (Community Services) from the North West Institute of TAFE, Tasmania (1993 – 1994); an “Achievement Award – Train the Trainer – Train Small Groups” also from TAFE (1993); a Bachelor of Arts (Humanities) from the University of Tasmania (1996 – 2000); a Bachelor of Social Work (2001 – 2004), and a Masters of Social Work (2005 – 2007), both from Monash University. Between 1994 and 2005, she was involved with, and attended, numerous conferences, seminars, and workshops with respect to her professional development.

53. Between 1994 and November 2005, at different times, the Plaintiff had held various positions, in different organisations, in different states of Australia, as a counsellor, youth support worker, disability support worker, case worker, social worker, and a researcher. She had been involved in areas of personal development, counselling, community development projects, women’s health, the provision of assessment and intervention to Centrelink customers, case work and regular case conferencing.

54. The Plaintiff, in a document headed “Career Summary” (Ex. A/160) described her skills as including “Strength in the understanding, interpretation and delivery of theoretical and practical administration of Policy development, implementation and evaluation in health care and social service provision”; “excellence in understanding of and ability to plan and co-ordinate Community Education & Training, Community Development and Health Promotional activities”; a “demonstrated ability in the Co-ordination and Management of programs in community services”. She also stated that she was a “Published writer on Community Development & Health Promotional Models”.

55. In this document, the Plaintiff stated that she had “Eighteen years experience Project Co-ordination, Case Work, Counselling & Community Education & Training, Community Development and Health Promotional activities”. She gave oral evidence that “over the period from … the late 1990s onwards, [her] work, when [she was] working, was in social work”: T32.29 – T32.31.

56. In March 2006, the Plaintiff was involved in what counsel described as a “very unfortunate incident”: T33.42 – T33.43. She was involved in a single vehicle motor vehicle accident in Warrugul, Victoria. It was alleged that she was alcohol affected at the time of the accident. She asserted that, following her arrest, she had been taken into police custody, searched whilst in custody, and assaulted by the police (including sexually). She described this incident as “having ruined my life”: T34.04 – T34.06.

57. The day after the incident, the Plaintiff, assisted by her sister, returned from Victoria to northern Tasmania. It was on 14 March 2006 that she attended the Burnie Medical Centre where she was seen by Dr A Stillger, by whom she has been treated since then: T35.27 – T35.28.

58. The Plaintiff gave evidence in cross-examination (T36 – T38) in relation to the sequelae of the events in 2006, which may be summarised, as follows:

1. When having to deal with the police, her stress would increase;

2. At any time that she needed to go to court, it had caused her great stress;

3. Her anxiety and depression would gradually improve and then she would have something to do with a court event and her condition would worsen again;

4. The great stress she felt in attending at court would affect her depression and anxiety;

5. The outcome of the proceedings had been “quite unpleasant”;

6. Following the conclusion of the (initial) court proceedings, she started to feel better.

59. The Plaintiff did not include in the particulars referred to in the amended Statement of Claim, or otherwise provide in her affidavits, a detailed explanation of the experiences referred to which she said had caused her to suffer from what she claimed to be PTSD.

60. (As will be read, there is some medical evidence about what are said to be the psychological consequences to the Plaintiff of the events of March 2006.) She agreed that, prior to those events, she “had issues with depression and anxiety at various times”: T34.15 – T34.17.

61. Following a complaint made to the Tasmanian Police, and the pursuit of criminal charges by her, a court ruled that the bruises which she said had occurred during the assault were self-inflicted. The Plaintiff was charged with, and subsequently convicted of, making false statements: Ex. A/243(c); T36.11 – T36.18.

62. The jury trial, in which she was convicted, occurred in about July 2008 and had lasted for about one week. Shortly before the trial commenced, she was referred to Mr Marriott, a Clinical and Forensic Psychologist, to whom she had been referred, for the first time in about 2000, and then, subsequently, with "increasing panic with her impending trial": T41.

63. On 8 May 2006, the Plaintiff registered a business name in Tasmania, called “Solutions by the Sea”, and, in private practice, she engaged in holistic counselling, therapy, and “Educative Consultancy”, specialising in working with children and adolescents, family therapy, group work, counselling for matters related to stress, grief, and loss, personal development, alcohol and drug issues, and sexual and mental health: Ex. A/159. She gave evidence that it was “A private practice in counselling and consultancy on community development projects”: T38.31 – T38.36.

64. In her evidence, the Plaintiff also stated that she conducted this business and thought that she had been working in it in 2007 (at least before she commenced work with the Employer). The hours of work in which she was engaged was not the subject of evidence.

65. In late 2007, the Plaintiff commenced work with the Employer. Although its head office was in Victoria, the Plaintiff worked on the north-west coast, and also, on the north coast, of Tasmania.

66. The Plaintiff described her duties as “providing counselling to individuals and groups, setting up a carers’ centre, and assisting people in crisis”: Ex. A/170. Her duties, as disclosed in an Employer’s Statement, dated 23 November 2014, were described as “works with clients, documents information”: Ex. A/152.

67. The Plaintiff acknowledged that she has, or had, an abiding interest in social work: T32.01 – T32.04.

68. In January 2008, whilst still employed by the Employer, the Plaintiff commenced a full-time course to obtain a PhD in Philosophy of Modern Social Work at the University of Tasmania. When she commenced the course, she felt it was the right choice for her “to think about other options for my future in terms of employability”, including, perhaps, going into academia. She studied off campus via online, telephone and correspondence. She continued as a research candidate until she “totally withdrew from the course on 21 April 2011” (Ex. A/239).

69. At about the time she commenced work with, and whilst employed by, the Employer, the Plaintiff became aware that her mother had health issues. Her mother suffered a severe cerebral stroke which caused bleeding on the brain and which required her mother to be rushed to Hobart for emergency surgery. Whilst her mother was so unwell, it fell to the Plaintiff, at least partly, to look after other members of the family: T39.

70. The precise circumstances in which the Plaintiff ceased working with the Employer are not set out, in any detail, in the evidence. There does not appear to have been a specific incident that prompted the cessation of her employment. Nor did the Plaintiff assert that she had been injured at work or that she was discharged by the Employer on medical grounds.

71. In an Application for “Early access to reserved superannuation benefits on medical grounds” dated 7 August 2014 (Ex. A/144 – 145), the Plaintiff stated, as the reason for her retirement from the workforce, “Nervous breakdown. Mutual agreement to cease work”. (The date of the “nervous breakdown” was not identified in that document.)

72. In the amended Statement of Claim, the Plaintiff asserted that “on or about 25 January 2008”, she had “ceased all work as a result of psychological injury or illness in the nature of Post-Traumatic Stress Disorder, anxiety, depression and agoraphobia”. She denied that she decided to leave the Employer so she could concentrate on the PhD and looking after her mother: T40.27 – T40.29.

73. In her oral evidence, the Plaintiff maintained that she had been unable to perform the normal duties of her occupation from about 25 January 2008 “due to [a] breakdown, emotional, and physical inability to perform”: T31.14 – T31.19. She repeated, when asked, at T49.48 – T49.50, that at that date she ceased work with the Employer, she was of the view that she was unable to work.

74. (There is a reference in a report dated 27 October 2010 (Ex. A/297 – 300), which report pre-dates, by some years, the Claim, to the Plaintiff having repeated that she did not feel that she was in a fit state to work and had decided to do more study whilst she tried to get better.)

75. Counsel for the Plaintiff submitted that it was “an illness case, in the sense that ‘illness’ isn't defined in this policy and ‘illness’, in my submission, is typically understood in these types of policies as extending to psychological illnesses”: T62.36 – T62.41.

76. Following her ceasing employment with the Employer, the Plaintiff looked after her mother and continued with her PhD studies: T40.34 – T40.36.

77. In cross-examination, the Plaintiff accepted that the PhD, caring for her mother and working for the Employer “was all a bit much”: T40.23 – T40.25.

78. The Plaintiff accepted that by March 2009, she had presented to Dr Stillger as “good at present”; that, then, she was still actively engaged in pursuing the PhD studies at the University of Tasmania; that she was getting an Abstudy benefit, which was a group of payments for Aboriginal or Torres Strait Islander students; and that the Court cases, stemming from the incident in March 2006, had all, one way or another, resolved and were behind her: T43.08 – T43.32. She also admitted that “up until September of 2009 [she] had been recovering from the events of 2006”: T45.11 – T45.13.

79. However, the Plaintiff maintained that different stressors would impact upon her and that sometimes the condition about which she complained could be triggered by something that she would not even see coming: T51.48 – T52.04.

80. In September 2009, the Plaintiff was assaulted by a former boyfriend as a result of which assault she sustained several physical injuries, including several rib fractures, she had difficulty breathing and suffered ongoing pain in her back. The assault also had an aggravating effect on any anxiety, or depression, from which she was suffering and made her more agoraphobic: T43 – T44.

81. The Plaintiff also gave evidence that she had not recovered after the assault and that it had a profound impact upon her physically, because, during an MRI, an arachnoid cyst was found in her thoracic spine area that could not be removed, which had affected her mobility as well as her ability to sit. She repeated that the assault also had made her anxiety and depression worse and that she suffered terrible panic attacks: T45.18 – T45.40.

82. She agreed that to the extent that she suffered L4/L5 ruptured discs, these were as a result of the assault in September 2009 and that although she had suffered PTSD as a result of the March 2006 incident, her condition was aggravated by the subsequent assault in September 2009: T46.47 – T48.19.

83. Ultimately, the person who assaulted the Plaintiff in September 2009 was sent to trial, and, in November 2010, the Plaintiff provided a Victim Impact Statement: Ex. A/771 – 772. In that document, she described her life as having “been turned upside down by this incident”. (I shall not deal with other matters in the Victim Impact Statement at this point because they are referred to later in these reasons.)

84. In April 2011, the Plaintiff withdrew from the PhD course commenced in early 2008. She stated, in Ex. A/174, that she had been “forced to stop … due to my mental illness and symptoms. I recall an occasion where I had to stand up in front of a group of students and had a panic attack. I had to flee the classroom and run to the toilet. I cried and had to calm myself down.”

85. The Plaintiff agreed, in cross-examination, that she had withdrawn from the PhD course as a consequence of the sequelae of the assault in September 2009: T46.15 – T46.21.

86. Despite the assault in September 2009, and even though she had withdrawn from the PhD course in April 2011, in February 2012, the Plaintiff commenced a Post Graduate Criminology Degree, at Monash University. She studied off campus via online, telephone and correspondence until she withdrew from the course on 23 July 2012 (Ex. A/239).

87. The Plaintiff gave evidence that, as a result of the assault in 2009, she had applied for employment within her field but had withdrawn her application “at the last minute because I know I won't be able to get through the interview”: T46.27 – T46.36.

88. At the date of hearing, the Plaintiff was no longer receiving One Path Income Protection payments, so she had applied for the full disability support pension, which pension was about to start: T28.01 – T28.06. She stated that whilst a number of her medications had changed, she did not agree that her overall condition had improved since she had sworn the affidavit of August 2017: T30.03 – T30.09.

59. In cross-examination, the Plaintiff agreed that when she made her the Claim in March 2014, she did so by reason of both the initial event in March 2006 and all of the consequences of the event in September 2009, and that it was the whole problem, globally, that had prevented her from ever working again: T48.00 – T48.25.

60. In answers to questions from the Bench at T54.38 – T55.05, the Plaintiff said:

Q: … at the time you left Aspire, whether it was the 25th or 28th of January, did you believe you could work?

A. I hoped. I'm not sure that I … I didn't have my faculties about me at all and that's why they asked me to leave, and looking back I see why. In my heart I wanted to return to work, but there were so many triggers for me in society that I had to hide.

Q. But I think you accepted from Mr Hanson that you were improving after that time until the events of September 2009?

A. Yes. Yes.

Q. Is it fair to say that you must have believed that you were capable of doing other work because you actually applied for other jobs?

A. Yes. I live in hope all the time.

Q. And you did that until September 2009?

A. Highly likely, yes, because I'm pretty driven and I wouldn't have wanted to give up without a good fight.”

91. The Plaintiff could not remember whether she had actually applied for any jobs after September 2009: T55.29 – T56.05.

The Trust Deed

92. As there is no longer any claim made against the Trustee, the structure of the Trust Deed governing the terms of the Fund does not need to be set out.

The Policy

93. The Policy, in Clause 2, provides a number of “defined terms”.

94. It defined “Date of Disablement” in relation to a disablement claim as “the date on which commenced the most recent period of absence from employment through injury or illness”.

95. Whereas I intend to address the Plaintiff’s submissions later in these reasons, I interpolate here, that counsel for the Plaintiff contended, at [22] of the written submissions (in chief) that the “Date of Disablement” was “the date on which the most recent period of absence from employment due to illness or injury commences” and, somewhat inconsistently with what had been pleaded, at Paragraph [24], that:

“Importantly, the TPD clause does not require the plaintiff to have ceased work due to illness or injury. Rather, in order to satisfy part (i) of the TPD clause, it is only necessary that the plaintiff became, at some stage within the two year period after she last worked, unable to work because of injury or illness. There is no requirement that the plaintiff (or any ‘Insured Member’) actually be in employment at the time they become unable to work due to injury or illness – to suggest otherwise would be to render the qualifying portion of the TPD clause (‘in relation to an Insured Member who has been in gainful work at any time during the two years immediately preceding the Date of Disablement’) otiose. The temporal requirement ‘at any time during the two years immediately preceding the Date of Disablement’ specifically contemplates that the ‘Insured Member’ need not be in employment as at the ‘Date of Disablement’. Accordingly, it is sufficient that the ‘Insured Member’ is rendered unable to work by illness or injury, irrespective of whether, absent that injury or illness.”

96. (The first sentence of the Paragraph appears wrong because the definition of TPD is stated to be based upon the Insured Member having been continuously unable to work “because of injury or illness for the TPD Waiting Period”. In fact, the only Date of Disablement that had been alleged in the amended Statement of Claim was 25 January 2008 (Paragraph 9 and the particulars of the amended Statement of Claim) and that the Plaintiff had been unable to work because of injury or illness for the TPD Waiting Period (Paragraph 10 of the amended Statement of Claim).)

97. When asked, in oral submissions, what, in the circumstances of this case, the date of disablement was, counsel for the Plaintiff responded “it is any date … within the two years commencing from 28 January 2008”, namely to 28 January 2010: T19.40 – T20.11. He submitted that the date of disablement was “the most recent period of absence from employment”: T61.09 – T61.13.

98. Counsel also submitted that the waiting period, if the last date was 28 January 2010, would expire on 28 July 2010: T21.03 – T21.07.

99. Counsel for the Insurer disputed that the Plaintiff’s construction of the “Disablement Date” should be accepted. He submitted that the “date on which commenced the most recent period of absence from employment through injury or illness, [the Plaintiff’s] case is [when] she ceased on 25 or 28 January and has not been back so that must be the commencement of the most recent period of absence”: T112.28 – T112.40.

100. He also submitted that the Policy defined, relevantly, an “Insured Event” in relation to an Insured Member, as including “becoming Totally and Permanently Disabled prior to the Expiry Age for Total and Permanent Disablement Cover”.

101. Under the Policy, “TPD Benefit” was said to mean “the benefit payable by the Insurer in respect of an Insured Member who suffers Total and Permanent Disablement”.

102. The term “disability” was not, in fact, defined in the Policy. However, there was a definition of TPD, which so far as is relevant, states:

“… in relation to an Insured Member who has been in gainful work at any time

during the two years immediately preceding the Date of Disablement:

(a) (i) the Insured Member has been continuously unable to work because of injury or illness for the TPD Waiting Period; and

(ii) in the Insurer's opinion (after considering medical and other evidence satisfactory to the Insurer) the Insured Member is unable ever again to work for reward in any business, occupation or regular duties for which he or she is reasonably qualified by education, training or experience;

…

For the purposes of this definition business, occupation or regular duties means:

• full-time business, occupation or regular duties where the Insured Member was working at least 15 hours per week at the Date of Disablement …”

103. (The Insurer referred to sub-paragraph (a)(i) of this definition as “the Stage 1” enquiry and to sub-paragraph (a)(ii) (set out above) as “the Stage 2” enquiry.)

104. I shall return to the submissions on this topic later in these reasons.

105. The TPD Waiting Period was six months.

106. Under Clause 11 of the Policy, the Insurer agreed to pay a TPD Benefit, as follows:

“Benefits – Amount and When Payable

11.1   If appropriate premiums have been duly paid and if to the satisfaction of the Insurer it is established that in respect of an Insured Member an Insured Event has occurred then subject to anything to the contrary arising pursuant to this Policy, the relevant Sum Insured shall become payable to the Policy Owner.

11.2   Death Benefits, TPD Benefits and TTD Benefits are calculated as at the Benefit Calculation Date. Other Benefits are calculated as specifically provided in this Policy.”

107. Thus, the definition of TPD, relevantly, contained different limbs assuming the Insured Member to have been in “gainful work” at any time during the two years immediately preceding the Date of Disablement. If the Date of Disablement was 25 (or 28) January 2008, there was no dispute about this limb having been established. (Indeed, it is beyond argument that the Plaintiff had been in gainful work during the two years immediately preceding the date in January 2008 if that is the Date of Disablement.)

108. There was no suggestion, in the Policy, that the injury, or the illness, must be work related.

109. It also seemed not to be in dispute that there was then a further limb required to be established. The Insurer was required to form an opinion, after consideration of medical, and other, evidence satisfactory to it, that the “Insured Member is unable ever again to work for reward in any business, occupation or regular duties, for which … she is reasonably qualified by education, training or experience”.

Detailed Chronology of the Plaintiff’s Claim vis-à-vis the Defendants

110. By letter dated 29 April 2014, from the Plaintiff’s solicitors to the Administrative Officer of the Trustee, information was sought upon the basis that the Plaintiff had instructed the solicitors to “assist her in applying for total and permanent disablement benefits and/or income protection benefits”.

111. The Plaintiff’s solicitors sent another letter, dated 13 May 2014, referring to the earlier letter, requesting the information that had been sought “as soon as possible”.

112. The Trustee responded by letter dated 21 May 2014. It provided much of the requested information and required the completion and return of a number of forms, and the provision, by the Plaintiff, of some additional documents.

113. On 10 July 2014, the Plaintiff completed the Insurer’s “Member’s Statement” (Ex. A/138 – 141) which she identified as a “Total and Permanent Disability Claim”. In this document, she identified as her injury “L4/L5 Ruptured Discs – [PTSD]” and stated that the injury occurred on “13/3/2006 & 2009”, and that it had occurred in a “(1) Bathroom rape [and] (2) Home Invasion”. She also stated that she had suffered an illness, being “Acute Lymphoblastic [leukaemia]”, “arachnoid mass spine” and “adrenal adenoma” 2006. She stated that on 28 January 2008 she had suffered a “Breakdown. Emotional. Physical inability to perform” and that she had ceased work on 28 January 2008, ticking the box “Can do no work”. In answer to the question "Have you, as a direct result of this disability, been unable to perform the normal duties of your occupation", she responded, "Yes". She stated that she would “never” be able to return to work.

114. In answer to the question “Any other comments that you consider may be relevant to your claim”, the Plaintiff replied that:

“Due to mix of P.T.S.D. plus multipul [sic] health issues I can never return to work.”

115. The Plaintiff also claimed that from her last day at work, she had been unable to perform her usual duties due to "Breakdown, Emotional" and her "Physical inability to perform".

116. On the same date, the Plaintiff completed an application for a TPD “VicSuper FutureSaver”. She repeated the matters asserted above.

117. The Plaintiff asserted that her “date of disability” was 13 March 2006. The Claim was said to arise from the following disability or illness:

1. in terms of injury: L4/L5 Ruptured Discs; and

2. in terms of illness: "Acute Lymphoblastic [Leukaemia], Aracnoid [sic] Mass Spine, Adrenal Adenoma"; it also referred to “PTSD”, which was attributed to the alleged sexual assault in 2006, and the alleged “physical assault … [and] home invasion” in 2009.

118. By letter dated 19 August 2014, the Trustee requested information as to “the date [the Plaintiff had] last attended work”.

119. By letter dated 15 October 2014, the Plaintiff, by her solicitors, lodged the Claim with the Trustee for payment of the TPD benefit. The letter enclosed the documents that had been sought by the Trustee.

120. By letter dated 20 October 2014, the Trustee acknowledged receipt of the Claim; requested further documents from the Plaintiff; stated that it had written to the Employer; and that “once we have received all documentation relating to the TPD claim, we will send your client’s claim to our Insurer.”

121. By letter dated 27 October 2014, the Plaintiff’s solicitors disputed the need for further information and requested that “you forward the documentation on to the insurer without any further delay”.

122. By letter dated 30 October 2014, the Trustee confirmed that it had written to the Employer to request an “Employer’s Statement, which must be completed by the employer and returned to the Trustee before the claim can be submitted to our Insurer”.

123. By letter dated 4 November 2014, the Plaintiff’s solicitors threatened to commence legal proceedings.

124. The Trustee received the Employer’s Statement, dated 23 November 2014, relating to the Plaintiff, on about 1 December 2014. In that document, in response to the question “What is the nature of the disability”, the answer “Not documented & unable to contact appropriate person from that date” was stated, and that the employee “Chose to leave”: Ex. A/153-155.

125. A letter dated 1 December 2014 from the Trustee to the Plaintiff’s solicitors revealed that “the claim has been submitted to our Insurer, AMP, for assessment” and that the Insurer will “deal with you directly to obtain any further information they [sic] require to assess your client’s entitlement”.

126. By letter dated 11 December 2014, the Plaintiff’s solicitors wrote to the Insurer requesting its acknowledgement of documents and that it was assessing the Plaintiff’s claim.

127. By letter dated 5 January 2015, the Trustee indicated that the Insurer had acknowledged the Plaintiff’s TPD claim and had commenced its assessment. The letter stated that “[t]he emphasis in the management of this claim is to medically assess the impact of the claimed condition on your client’s ability to continue to work in her occupation or in a suitable position in line with her education, training and experience”: Ex. A/202. In addition, further information and documentation was sought.

128. Thereafter, there was a stream of correspondence passing, in the next months, between the solicitors for the Plaintiff and the Insurer regarding the making of the assessment, requiring, or providing, further documentation, and otherwise, the details of which correspondence it is not necessary to rehearse.

129. Under cover of a letter dated 17 March 2015, the Plaintiff’s solicitors provided some additional documents to the Trustee. A letter of the same date was sent to the Insurer confirming that further documents had been provided.

130. By email dated 23 March 2015, a claims assessor with the Trustee informed the Plaintiff’s solicitors that “your letters dated 17 March 2015, along with additional documents have been referred to AMP for further assessment”.

131. Under cover of a letter dated 29 June 2015, the Plaintiff’s solicitors sent to the Trustee, a document, dated 18 June 2015, headed “Statement of Client”. In this document (Ex. A/170 – 174), the Plaintiff, relevantly, stated that:

1. She had “suffered assault in the past including rape and also physical assault”.

2. Due to the assaults, “I developed post-traumatic stress disorder (PTSD), major depression, anxiety, agoraphobia [and] panic attacks. I also suffer from a ruptured disc in my L4 – L5 and also had an arachnoid cyst in my T4 – T5 discs.”

3. She had suffered from acute lymphoblastic leukaemia in 2006.

4. Due to her mental illness symptoms and disabilities, she had “ceased all work in or about 25 January 2008”.

5. She “never returned to work due to [her] mental illness symptoms and restrictions, as well as [her] physical conditions and restrictions which affected [her] capacity to work” and that “as a result of [her] mental and physical conditions and symptoms, [she] never returned to any type of employment since ceasing work”.

6. She set out the medications which she had then been prescribed.

7. She stated that “[t]here is no way I could ever work in my previous job as a counsellor… All of [the] occupations require me to provide counselling and therapy to the public and people in crisis. Due to my mental and physical conditions and disabling symptoms I am not able to return to any job based on my previous education, training or experience.”

8. She had thought about retraining and had commenced a PhD, but was forced to stop “due to [her] mental illness and symptoms”.

9. There was no job in her locality that she could do on any regular basis due to her physical and mental health and ongoing symptoms.

132. By email dated 3 December 2015, from the Insurer to the Plaintiff’s solicitors, a request was made for the address of Dr Stillger and the identity of the Plaintiff’s then treating medical practitioner.

133. By letter dated 9 February 2016, from the Insurer, to the Plaintiff’s solicitors, a request was made for “information with regard to [the Plaintiff’s] treating practitioners at the time she ceased work in April 2008”. (There is no dispute that the date the Plaintiff ceased work referred to in this letter is incorrect.)

134. On 31 May 2016, the Insurer sent what was described as a “procedural fairness” letter to the Plaintiff’s solicitors. In this letter, the Insurer stated that “Before a final decision is made, AMP would like to give your client the opportunity to review the documents on which we will be basing our assessment”. The letter then identified “the evidence we have obtained throughout the course of our assessment” by way of what might be described as categories of documents. It set out the Policy definition of TPD, identified, wrongly, the relevant date of assessment, and added:

“As part of the assessment of your client’s TPD claim, we have obtained various medical reports and supplementary information which we consider to contain information that is adverse to your client’s claim.”

135. The letter also went on to summarise a number of the documents and concluded:

“The above medical information does not reflect that Mrs Folmer ceased work due to the claimed conditions of PTSD, a lower back injury and bowel issues. We consider the relevant date of assessment to be the end of the applicable waiting period, being 18 [sic] July 2008, and it is noted that our assessment has unveiled that Mrs Folmer was not seeking medical treatment at this time for the conditions she claims to have caused her to cease work, and continue to render her permanently unable to return.

Please be advised that AMP has not made a decision on your client’s claim at this stage. AMP would like to give your client the opportunity to review all the evidence provided and the comments above. Please provide us with your comments and any additional information/evidence which may assist your claim.” (Emphasis in original.)

136. The letter concluded with the comment that should no further information be received within 28 days of the letter, “we will assume your client has no further commentary or evidence to provide and we will proceed with a recommendation on your client’s claim to the Trustee of the plan”.

137. (The letter contained a number of inaccuracies which are not necessary to repeat: T116.35 – T117.09.)

138. In a letter dated 10 June 2016, addressed to both the Trustee and the Insurer, the receipt of which was acknowledged by the Insurer in an email dated 14 June 2016, the Plaintiff’s solicitors responded to the “procedural fairness letter”, by identifying various other documents and information. (The letter also included a reference to the date the Plaintiff ceased work being Friday, 25 January 2008. As stated, this date varies, as there is a reference, in other documents, to the Plaintiff having ceased work on Monday 28 January 2008. Nothing turns on the two different dates.)

139. The letter concluded with the statement:

“In your procedural fairness letter you say that the medical information you have identified does not reflect that Ms Folmer ceased work due to the claimed condition of PTSD. We respectfully disagree with your view. A proper assessment shows Ms Folmer was seeking medical treatment around the period of assessment and she ceased work due to PTSD.

We have referred you to the medical evidence where it is clear that our client was suffering from symptoms of PTSD prior to ceasing work, and when she ceased work in January 2008, her symptoms became worse causing disablement, further these symptoms continued for 3 months after and led her to become totally and permanently disabled as defined.

In relation to a lower back injury and bowel issues, we acknowledge that our client suffered from these conditions after ceasing work. These conditions have contributed to her inability to work as well after she ceased work in January 2008.

We hope the insurer does the right thing and accepts our client’s claim.”

140. By email dated 26 July 2016, addressed to Plaintiff’s solicitors, the Insurer requested further information regarding the courses of study in which the Plaintiff had engaged in 2009, and in 2012, as it was “currently in the process of reviewing all of the documentation received on the total and permanent disablement claim for” the Plaintiff.

140. In an email dated 3 August 2016, the Plaintiff’s solicitors provided revised details of the Plaintiff’s university studies.

141. The Plaintiff’s solicitors wrote a letter dated 14 September 2016, in which further information was provided to the Trustee. The solicitors also complained of the Insurer’s delay, which it described as “unreasonable”, in making a decision. The Plaintiff’s solicitors also requested the Trustee to ensure that the Claim was accepted within 21 days, or if it was not, that the Trustee should agree to commence proceedings against the Insurer. (It was in this letter that a reference was made to s 52(7)(d) of the SIS Act.)

142. In an email dated 6 October 2016, under the name of Tee Brejnakowski, addressed to the Plaintiff’s solicitors, the Insurer stated that a “negative decision” had been made, which had not been issued, and that he had “reviewed this decision and do not believe that we have enough information to support the decision”. He stated that he would “need to research the claim to confirm answers to my questions and concerns prior to making any decision”.

143. The letter went on:

“I note that in the decision there is no mention of a report from Dr Stilger [sic] dated 16/01/2015 which states Ms Folmer is TPD. I believe that this needs to be included in our assessment.

I am unsure of Ms Folmer’s work prior to her cessation. There was a note to suggest she was working for 2 months prior to her cessation. I need to know if this is correct. She needs to have been working for 6 months prior to cessation to be eligible for TPD.

I also would like to investigate Ms Folmer’s PTSD. As far as I am aware, an incident occurred prior to Ms Folmer’s cessation of work, she was then able to obtain work despite this diagnosis. I am of the opinion that she may have been able to get work, however due to the condition of PTSD was unable to sustain her work. I will have our internal doctors review my findings and await their response.

Where you will be able to assist is by providing me information around Ms Folmer’s employment. As far as I am aware, she was working for two months. Can you please confirm her work and work history. The employer statement has the start date for Ms Folmer as at 18/02/2008 and end date 18/04/2008.

I will have my internal doctors review this claim and provide you with a further update. I should hope to hear back from them this time next week at the latest. Once I have collaborated [sic] all of this requested information, I believe a decision will be made.”

145. (There is no evidence about any review of the claim by “internal doctors” of the Insurer, any further investigations that the Insurer actually carried out, or that the results of investigations, if any were carried out, were provided to the Plaintiff’s solicitors.)

146. In a document headed “TPD Final Claim Summary Dated 23/11/2016”, sent to the Trustee, the Insurer declined the Plaintiff’s claim. In that document, it was said that the date the Plaintiff “was employed by the Employer for a period of two months between 18 February 2008 and 18 April 2008”. (These dates had been obtained from a statement provided by the Employer, which the parties agreed was incorrect.)

147. Although lengthy, it is necessary to repeat a significant part of the document:

“When considering the claim, all the evidence available (medical and non-medical) was considered and applied to the terms and conditions on the policy.

The following comments are AMP’s view of the evidence received and our recommendation to the Trustee is below. AMP recommends that when considering the claim, the Trustees should read all the available evidence in its entirety in conjunction with this summary.

The following reports in the table below were reviewed and assessed during the claim assessment. We refer you to the final column whereby we have provided an opinion with regards to whether or not each report supports the member’s claim for Total and Permanent Disability (TPD):

Date of Report	Report Received From	Speciality	Supports TPD?
27/10/2010	Dr Ross Kirkman	Psychiatrist	No
23/11/2014	Aspire, Pathway to Mental Health	Employers Statement	No
01/12/2014	Firths	Initial Claim Docs	N/A
24/12/2014	Dr Jandranta Stillger	General Practitioner	No
08/02/2016	CommInsure	TPD File	No
27/04/2016	Dr Dani Buchanan	General Practitioner	No

…

Conclusion

Mrs Folmer advises she ceased work as a result of PTSD and recurrent bowel issues. She has also claimed for a back injury, however this is outside the scope of the assessment as the injury occurred 17 months after she ceased work.

There is limited medical evidence to reflect that leading up to her ceasing work, her conditions or the symptoms associated had increased to a point which impacted her function. This is reinforced by the fact that Mrs Folmer maintained her academic studies in Social Work throughout 2008, until ceasing these studies in 2012.

Despite ceasing work in April 2008 for symptoms relating to PTSD and recurrent bowel complaints, Mrs Folmer had no Psychological or Psychiatric treatment at this time. It was in fact over two years before she sought professional treatment for PTSD from Dr Ross Kirkman, Psychiatrist, and we note she only attended for two appointments.

Further, there exist no clinical entries from either GP to reflect that Mrs Folmer was attending for treatment of either condition of PTSD or recurrent bowel symptoms.

Based on the evidence summarised above, AMP considers that Mrs Susan Folmer does not meet the definition of totally and permanently disabled, and accordingly, the claim is declined.”

148. The TPD Final Claim Summary was not provided to the Plaintiff’s solicitors but only to the Trustee. (At T76.39 – T76.41, counsel accepted that “it is the decision that was sent to the Trustee and constitutes the decision and the reasons for the decision of [the Insurer] to decline the Plaintiff's claim”.)

149. There, then, followed some further correspondence between the Plaintiff’s legal representatives and the Trustee. In an email dated 2 December 2016, the Plaintiff’s solicitors referred to:

“…clinical notes of Dr Stilger [sic] from 2006 to May 2008 where the Doctor recorded panic, anxiety and reactive depression as diagnoses. The Doctor prescribed her medication to treat psychological conditions. Therefore our client was under regular medical treatment for her psychological conditions when she ceased work and after. Kindly also note Dr Stilger [sic], the treating Doctor of many years certified our client TPD in January 2008.”

150. A copy of the email must also have been provided to the Insurer because Mr Brejnakowski responded by email on 2 December 2016 (Ex. A/248):

“Thanks for your email.

Please note that Procedural Fairness was issued and you have replied to this letter previously via email.

You make note of [the Plaintiff] being under regular medical treatment between 2006 and 2008. The relevant date of assessment is in 2008. [The Plaintiff] needs to be in regular treatment post her last day worked, which was in 2008. This has not been the case. As I mentioned in my previous email and also as Jenna Wood has previously advised you via email correspondence, the earliest date for psych treatment post [the Plaintiff] relevant date of assessment is not until 2010.

Lastly, as I have previously mentioned in my below email, AMP has sent its recommendations to the fund (VicSuper). VicSuper will be in touch with you regarding the decision. If you would like a copy of the policy, you need to contact VicSuper.”

151. The Plaintiff’s solicitors responded to the Trustee by letter dated 7 December 2016. The letter, relevantly, provided:

“We refer to this matter and the assessment of this claim. We enclose herewith copy of email from AMP to Firths dated 2 December 2016. It appears that the insurer has declined our client’s claim on the basis that she was not allegedly under medical treatment in 2008.

I have reviewed the policy provided by you on 5 December 2016 and have found no reference to a requirement that an insured members needs to be under medical treatment to satisfy the TPD definition.

TPD means:

…

A requirement for medical treatment after ceasing work is not mentioned in the above clauses of the policy. If the insurer has declined our client’s claim because it alleges our client did not get medical treatment after ceasing work, it would be wrong at law and its decision will be set aside in Court.

In addition, Ms Folmer received medical treatment by her GP in the form of medication. Kindly refer to our letter to the trustee dated 10 June 2016 for details.

We advise again that our client’s TPD claims with AustralianSuper and Tasplan were all accepted with the same evidence provided to VicSuper and AMP. The evidence speaks with one voice that our client is TPD.

As you can appreciate, there is clearly unreasonable delay in finalising the assessment of this claim since it was lodged on 15 October 2014. There is no reason or excuse that we can envisage that would permit the insurer with your acquiescence to take over two years and two months and decline the claim if it declined it.

Further, if the insurer indeed declined our client’s claim, it breached its duties by not providing our client with a procedural fairness letter after it was reassessed by a different case manager from AMP.”

152. By letter 16 March 2017, the Trustee declined the Plaintiff’s claim, stating that the Plaintiff did not meet “the definition of Total and Permanent Disablement”. As there is no claim made about the Trustee’s decision, it is unnecessary to refer to its reasons further.

153. In a manner not fully made clear by the evidence, the Insurer’s decision became known to the Plaintiff’s solicitors.

154. In a letter dated 27 September 2017, from the Insurer to the Plaintiff’s solicitors (Ex. A/256 – 260), sent under cover of an email of the same date, it was noted that “although the Trustee had informed your client that we had declined this claim, reasons for our view had not been provided. This letter seeks to inform your client about why we declined this claim”.

155. The letter, continued:

“We have reviewed and considered a large volume of material either submitted to us or obtained by us during the assessment of the claim. This letter is not intended to be an exhaustive or ‘judicial’ explanation of our reasoning; nor will it attempt to refer to all of the material considered in the assessment of the claim. The fact that a document may not be specifically referred to herein does not indicate that it was not considered. We note that a list of the material before us was provided to you with our ‘procedural fairness’ letter, prior to the declinature of the claim.

The facts of the claim

…

We understand that your client’s claim is based upon psychological symptoms (variously characterised by her as stress, depression, anxiety and post-traumatic stress disorder) and orthopaedic symptoms (variously characterised by her as L4/L5 rupture, an arachnoid mass in the thoracic spine, disc pathology and sciatic pain).

Definition

…

Principles

The definition requires that your client be continuously unable to work because of injury or illness for 6 months (the first limb requirement). We understand that your client asserts that she was so unable from 25 January 2008, being the relevant Date of Disablement, and that she ceased work with Aspire due to her claimed medical condition(s).

The definition also requires that, in our opinion, your client be unable ever again to work for reward in any business, occupation or regular duties for which he or she is reasonably qualified by education, training or experience (the second limb requirement).

The time at which we must assess the second limb requirement is at the end of the 6-month inability to work, as set out in the first limb requirement – that is, as at 25 July 2008. We must be satisfied that the prognostic character of her condition has been established as at 25 July 2008. Unexpected subsequent deterioration, or subsequent illnesses or incidents, are not relevant to our assessment of the claim. We accept that evidence created after July 2008 will be relevant, to the extent that it is pertinent to your client’s condition and prognosis as at July 2008.

Our reasoning

The first limb requirement

The medical evidence available to us is strikingly silent at and about the time that your client ceased work with Aspire (25 January 2008).

We note that:

•   your client’s medical history indicates:

o   depression in 2000;

o   orthopaedic pain in 2001 due to a motor vehicle accident; and

o   leukaemia and PTSD in 2006,

although we have not seen the primary medical records in relation to these conditions;

•   in April 2007, the clinical records of Dr Stillger (treating GP) note that your client was ‘cutting herself’ and engaging in ‘self harm’, ‘having flash backs’ and ‘not remembering doing things’, although she was said to be ‘coping well’;

•   after April 2007, your client does not appear to have consulted Dr Stillger, or any other doctor, until 11 February 2008, when she saw the GP with respect to sweaty episodes and a menopause check. She was, at that time, taking antidepressant and anti-anxiety medication (Lovan and Kalma);

•   your client next saw Dr Stillger in May 2008, first with respect to diagnostic imaging (apparently because her mother had suffered a brain haemorrhage), and then in relation to a tooth abscess, thyroid function tests and routine chemistry. It was noted that she was doing a Ph.D. and looking after her mother. She reported being better with medication (which may have been a reference to Kalma, which she was again prescribed in May 2008).

Our view is that there is no medical evidence to suggest that your client was unable to work because of injury or illness in January 2008. The medical evidence does not show that your client was reporting any significant symptoms or consulting any doctor in relation to her claimed condition(s) at or about January 2008 – let alone that any doctor considered her unable to work.

It is therefore our view that the first limb requirement is not met.

The second limb requirement

The medical evidence indicates that, in and after July 2008, your client reported panic attacks, agoraphobia, and increasing panic, all of which were attributed by her medical practitioners to a temporary stressor, being a Court trial in which your client was involved.

Importantly:

•   there is no discussion by any doctor at or relating to that time of the impact of her symptoms upon her capacity for work; and

•   there is no suggestion by any doctor at or relating to that time that her symptoms were expected to be permanent, rather than being a temporary reaction to the Court trial.

By March and July 2009, your client was described in Dr Stillger’s clinical notes as ‘good at present’ and ‘well’, and her panic attacks were being controlled by Ativan.

On 9 September 2009, your client suffered an assault by a former partner, which resulted in fracture to her ribs and injuries to her neck and back. The pattern of the medical evidence suggests that the assault exacerbated her psychological symptoms.

The medical evidence in 2011 specifically links your client’s then back symptoms to the assault in 2009, and notes that the assault had caused her to be psychologically distributed (see Report of Dr Watson dated 15 March 2011).

In 2011, your client was found to have developed an arachnoid cyst, which led to an increase in orthopaedic pain. The cyst continued to be discussed and treated throughout 2013.

In 2013, it is noted that your client’s mental health was comprised by ongoing harassment by her former partner.

We note that your client has provided her own analysis of her condition in a Victim Impact Statement in relation to the assault incident, apparently prior to the sentencing of her former partner in September 2010. Your client comments that:

•   four years earlier, she had begun taking anti-depression tablets, but had stopped taking such medication at the time of the assault;

•   after the incident, she needed to go back onto the medication (Lovan) and to double the dosage;

•   prior to the assault, she had suffered from anxiety, but had stopped taking medication for same;

•   since the incident, her anxiety was worse than it had ever been and she had again begun taking medication for it;

•   at the time of the assault she was ‘prescription medication free’;

•   as a result of the incident, she was experiencing terrible panic attacks, had been unable to sleep properly, suffered from nightmares, and would wake up screaming;

•   she would not go anywhere unless she had to, which is implied to be the result of the incident;

•   deterioration in her mental health, resulting in the suspension of her university studies, also followed the incident; and

•   she was now unable to attend employment interviews without breaking down and crying, which is implied to be attributable to the assault.

It is our view that the evidence does not reasonably justify the formation of an opinion that, as at July 2008, your client was unable ever again to work for reward in any business, occupational regular duties (as defined).

It is our view that:

•   there is insufficient basis for a conclusion that the necessary adverse prognosis existed as at 25 July 2008;

•   your client’s orthopaedic issues, as identified in her claim documents, are substantially attributable to the assault in September 2009, which is after the date for assessment of the claim. Those issues are therefore not relevant to our assessment;

•   your client’s mental health issues have been exacerbated by the assault in September 2009 and such deterioration is also not relevant to our assessment of the claim; and

•   we therefore do not form the opinion, and are not satisfied, that your client was, at 25 July 2008, unable ever again to work for reward in any business, occupation or regular duties (as defined), and we conclude that the second limb requirement is not met.

We trust that this letter provides an explanation of our declinature of this claim.”

156. (Counsel for the Plaintiff disputed that the letter dated 27 September 2017 constituted the reasons for the Insurer declining the Plaintiff's claim given in November 2016: T81.06 – T81.08.)

157. On 6 November 2017, the Plaintiff’s solicitors sent, by email, an affidavit, sworn 26 October 2017, of the Plaintiff, to the Insurer.

158. Under cover of an email dated 8 January 2018, the Plaintiff’s solicitors sent to the Insurer, a copy of a letter dated 2 January 2018, from Dr Stillger, which stated:

“In my opinion [the Plaintiff] had ceased work as a direct result of her significant mental health illness as noted from April 2008.”

159. In an email of the same date, but sent a short time later, the Plaintiff’s solicitors requested the Insurer to “reconsider its decision in light of the evidence served post declinature”.

160. In a letter dated 16 February 2018, addressed to the Plaintiff’s solicitors, which was described as the second decision (Ex. A/271 – 276), the Insurer referred to a number of submissions in response to the reasons set out in the letter dated 27 September 2017 and identified the additional documents that had been received since that letter, being the affidavit sworn 26 October 2017 of the Plaintiff, and the two reports, one dated 1 December 2017 and the second dated 2 January 2018, from Dr Stillger.

161. The letter went on to identify submissions, namely that “AMP has overlooked medical consultations undertaken by [the Plaintiff] between April 2007 and 11 February 2008”; that “insufficient regard has been given to the Medical Attendant’s Statement (MAS) of Dr Stillger”; and that “the [Victim Impact Statement] is erroneous and should not be relied upon”. Reference was also made to the letter of 27 September 2017 and to the reference to “the first limb requirement” and “the second limb requirement” in that letter.

162. It also set out the reasons for the conclusions identified and provided an explanation for what had been written. It stressed that whilst there might be documents (being the Medical Attendant’s Statement) that included statements from Dr Stillger that, in 2008, the Plaintiff “was unable to continue working and had to cease all work”, and that “these statements favour a positive conclusion regarding the first limb requirement (as to Dr Stillger’s recent reports) … [i]t remains our view that the more compelling evidence is to be found in the contemporaneous notes, which do not demonstrate any incapacity for work in 2008”.

280. Counsel for the Plaintiff submitted that it was the TPD Final Claim Summary of 23 November 2016 that constituted “in fact, the true reasons of the decision maker who made the decision to decline the claim”: T78.46 – T79.04.

281. There is no evidence that after 2 December 2016, that the Plaintiff complained of the Insurer not having provided reasons for declining the Plaintiff’s claim: T79.40 – T79.50. However, when the Insurer wrote again to the solicitors for the Plaintiff, on 27 September 2017, the Insurer appears to have proceeded upon the basis that “a complaint has been made on behalf of your client that although the Trustee had informed your client that we had declined this claim, reasons for our view had not been provided”: Ex. A/256.

282. At the hearing, the Court noted as an agreed fact that whilst there are no documents in evidence by, or on behalf of, the Plaintiff complaining of a lack of reasons, the parties accept that a complaint was made by, or on behalf of, the Plaintiff about an absence of reasons by the Insurer for it declining the Plaintiff's claim: T80.10 – T80.16. The letter of 27 September 2017 was produced by the Insurer in response to the Plaintiff's complaint: T80.24 – T80.30.

283. The Plaintiff submitted that the letter dated 27 September 2017 should be disregarded, as the author of that document is not known and it could not be stated that he, or she, was the same as the author of the TPD Final Claim Summary dated 23 November 2016. It was submitted that it was either, not both, the TPD Final Claim Summary or the letter of 27 September 2017 that constituted the Insurer’s reasons for declining, for the first time, the Plaintiff’s claim for TPD benefit.

284. Counsel for the Insurer described the September letter as “more fulsome and detailed reasons than that conveyed between insurer and insured, that is between AMP and [the] Trustee”: T78.10 – T78.17. In other words, the Insurer submitted that the two documents should be read together, although the later document should be given “primacy” as “the earlier is more clearly a working document and the second is more for the purpose of informing a person who is apparently seeking more detailed reasons”: T82.28 – T82.40.

285. There were many documents to consider and the matters were complex. As the Plaintiff’s solicitors recognised in the letter of 10 June 2016, that in respect of the “lower back injury and the bowel issues, we acknowledge that our client suffered from these conditions after ceasing work”. Accordingly, the claim for lack of reasons made by the Plaintiff fails.

286. The reasons that were provided enable the Court to consider the process of reasoning by which the Insurer reached its decision. It is the statement of reasons that will, normally, be accepted as evidence of the Insurer’s reasoning process. In the present case, it is the TPD Final Claim Summary of 23 November 2016, which provides the evidence of the Insurer’s reasoning process in first declining the Plaintiff’s claim.

287. The essence of the Insurer’s decision, as identified in the written submissions of counsel, was:

1. the medical evidence available to the Insurer did not support a conclusion that the Plaintiff was unable to work because of injury or illness at the time of her ceasing work in January 2008; and

2. the evidence available to the Insurer did not reasonably justify the formation of an opinion that, as at July 2008, the Plaintiff was unable ever again to work for reward in any business, occupation or regular duties for which she was reasonably qualified by education, training or experience.

298. It is necessary to consider whether the views expressed by the Insurer can be shown to have been unreasonable on the material then before it, or whether it had not considered the correct question and that, in considering that question, and informing itself as to matters material to its determination, the Insurer had not acted fairly and reasonably. The latter ground would include taking, or failing to take, particular matters into account if doing so, or omitting to do so, would constitute not acting fairly and reasonably having due regard for the interests of the Plaintiff.

299. The evidence available to the Insurer, as at November 2016, and thereafter, demonstrated that the Plaintiff, at least until early 2006, whilst suffering from a psychological condition, as well as some physical limitations, was able to work fulltime. There was no suggestion, in the evidence, that she had been unable to continue working. Then, there were the events of early 2006. The evidence provided in regard to the Plaintiff’s condition thereafter, in my view, demonstrated that her psychological condition, and physical condition, had deteriorated. Yet, despite her limitations, the Plaintiff was driven to continue to work and to commence a PhD. Her conduct, overall, as previously stated, does not present a picture of a person not prepared to work if able to do so.

300. However, by November 2016, it was clear that the Plaintiff had not worked, at all, for nearly 8.75 years. Of course, that was only one of the facts that the Insurer was required to consider. It is to be remembered that the formation of an opinion was required to be made as at the end of 6 months from the Date of Disablement, or on 25 (or 28) July 2008.

301. The medical, and other, evidence, available, which had been provided to the Insurer, at, or before, 23 November 2016, as set out above, that was relevant to each of the questions identified above, in my view, demonstrated that the Plaintiff was suffering from both psychological, and some, physical, disabilities at the time she ceased work in January 2008.

302. It was equally clear, from the documents then available to the Insurer, that, as at the Date of Disablement, the Plaintiff’s ability to work for remuneration was impaired because of those conditions. The psychological conditions from which she suffered at about the date she ceased work on 25 (or 28) January 2008 included PTSD, a panic disorder, and depression. This was made clear by the Patient Notes to which reference has been made. Those Patient Notes recorded the conditions for which she was being medicated, and the series of different anti-depressant, and anxiolytic, medications which she had been prescribed.

303. There was also the report, dated 28 September 2008, of Mr Marriott. Her psychological conditions were manifested by her behaviour, which included a number of self-harm activities, drinking alcohol to excess, panic attacks and agoraphobia, all of which were recorded in the Patient Notes to which reference has been made.

304. The Plaintiff’s physical conditions included a cancer diagnosis in 2005, as well as symptoms of gradual memory deterioration, the latter of which was reported as being consistent with an hypoxic brain injury suffered in the motor vehicle accident in 2006.

305. The symptoms, psychological and physical, of which she was complaining, prior to January 2008, it is fair to say, were not constant, and the medical reports for the period, prior to 28 July 2008, did not reveal that the Plaintiff was then incapacitated from all forms of employment. Even Mr Marriott’s report dated 28 September 2008 did not conclude that the Plaintiff was unable to work during that period or otherwise.

306. In fact, during the period during which the Plaintiff had suffered these very conditions and behaviours, that is, between about 2000 and January 2008, and particularly between March 2006 and January 2008, she appears to have remained in full-time employment, including, between late 2007 and when she ceased work in January 2008, with the Employer.

307. That a question about the complaint regarding PTSD existed, was identified, most clearly, in an email dated 6 October 2016, from Mr Brejnakowski of the Insurer to the Plaintiff’s solicitors, wherein he stated whilst he would like to investigate the Plaintiff’s PTSD, that “she may have been able to get work, however due to the condition of PTSD was unable to sustain her work” and that he would “have my internal doctors review my findings”.

308. Yet, no report of any internal doctors’ review is the subject of evidence given by the Insurer. That is an omission that was unexplained by the Insurer. If no internal doctors’ review was carried out, one wonders why it was raised. If such a review was carried out, the results were not made available to the Plaintiff or to the Court.

309. Subsequently, in the TPD Final Claim Summary dated 23 November 2016, the Insurer, in declining the claim, referred to various medical reports, and stated that:

1. The back injury the subject of her complaint “occurred 17 months after she ceased work”;

2. There was limited medical evidence leading up to her ceasing work to reflect that her conditions or symptoms impacted her function, as evidenced by her ability to maintain her academic studies;

3. She was receiving no psychological, or psychiatric, treatment at the time; and that her subsequent treatment, from Dr Kirkman, had occurred over two years later and was limited to her having attended two appointments only;

4. She was not receiving treatment for the bowel complaints upon which she had relied.

310. These matters led the Insurer to not accept that the Plaintiff had been “continuously unable to work because of injury or illness for the TPD Waiting Period” and thus that she did not satisfy the first limb of the TPD definition.

311. The Plaintiff herself, in the Member's Statement (Ex. A/138 – 140A) dated 10 July 2014, and then on 18 June 2015 (Ex. A/170), asserted that “[d]ue to my mental illness symptoms and disabilities I ceased all work”. Whilst her statements, in each of these documents, cannot be regarded as proving the fact asserted, and even though the Insurer was not obliged to accept what was asserted by her, or on her behalf, her statements were relevant and should have been taken into account. The work history of the Plaintiff to which I have referred, should also have been considered on the question of the acceptance, or rejection, of her stated belief.

312. Furthermore, whilst the Insurer was entitled to express doubt, or even scepticism, about such statements, any such doubt, or such scepticism, needed to be reasonably open on all of the evidence available to the Insurer at the time it considered her position. That there was no suggestion that she was untruthful on that topic is also relevant to considering what she had written and its significance.

313. It is correct, as submitted by counsel for the Insurer, that none of the medical records provided to the Insurer stated, specifically, that the Plaintiff ceased work because of the psychological, or physical, conditions from which she suffered. However, on balance, bearing in mind the information available, it is likely that her psychological condition, particularly the symptoms that were identified, prior to January 2008, and her memory problems, were likely to have contributed to her ceasing work. The Plaintiff certainly believed, and stated, on oath, more than once, that it was her mental state that had led to her ceasing work. It was not suggested to her that she was untruthful in this regard.

314. There was evidence, also available to the Insurer, which suggested other issues, such as the medical condition suffered by the Plaintiff’s mother and the impact upon the Plaintiff’s life, by taking on some added family responsibilities, together with the Plaintiff having commenced the course of PhD studies, which had also affected her psychological conditions and caused her to cease work.

315. The Plaintiff had not returned to any form of work during the 6 month period between 25 (or 28) January and 25 (or 28) July 2008. It was not suggested to her, in cross-examination, or otherwise, that she had been able to work, but had chosen not to return to employment.

316. Nor was there any suggestion in any of the medical records that she was malingering. Indeed, her conduct subsequently, in applying for jobs, at least until about September 2009, suggests that she was trying to obtain work.

317. The TPD Claim Summary also placed reliance, in leading the Insurer to the conclusion that the Plaintiff did not meet the definition of TPD, on the Plaintiff maintaining her academic studies in Social Work throughout 2008 and there being no clinical entries existing “from either GP to reflect that [the Plaintiff] was attending for treatment of either condition of PTSD or recurrent bowel symptoms”.

318. Yet, there were the Patient Progress Notes, as well as a number of reports of Dr Stillger, available to the Insurer at the time of the TPD Final Claim Summary of 23 November 2016, that were supportive of the Plaintiff having left employment in January 2008 because of illness and that she had remained out of work for the TPD Waiting Period.

319. I have considered the view expressed by the Insurer that Dr Stillger “did not make any attempt to describe the symptoms suffered by [the Plaintiff] in 2008”. The view formed by the Insurer was not open to it if acting reasonably and fairly in the consideration of the claim. The symptoms from which the Plaintiff had been suffering for a significant period were adequately identified in the Patient Progress Notes and other medical records to which reference has been made.

320. Also, the complaint by the Insurer that the basis of Dr Stillger’s view that, in 2008, the Plaintiff ceased work due to illness was not disclosed, and that she did not even identify the symptoms which she believed were being suffered at the time are also without merit for the same reason.

321. Furthermore, there is little in the TPD Final Claim Summary that identified whether the Insurer had given real consideration to the ongoing consequences of the Plaintiff’s medication which the Patient Notes identified as being prescribed for her before January 2008, between, January and July 2008, and thereafter. The medical records referred to the Plaintiff being anxious and depressed and also showed that she was being prescribed, and taking, anti-depressant and anxiolytic medication, both before, and throughout, the whole of the 6 month period following 25 (or 28) January 2008.

322. That, of itself, suggests that the medical practitioner who had seen the Plaintiff at the time of giving the prescription had diagnosed, and was treating, a psychological condition. In this regard, the statement that the Plaintiff was not obtaining treatment was inconsistent with, and contrary to, the contents of the Patient Progress Notes.

323. The Insurer appears to have limited itself to the fact that the Plaintiff was not attending for treatment by a medical practitioner for either condition of PTSD or recurrent bowel symptoms. Yet, I have identified the medical records relating to her attendance both before, and after, 25 (or 28) January 2008 and the condition, particularly the psychological condition, from which she then suffered and the prescriptions provided to her during that period.

324. There were documents also supportive of the Plaintiff being TPD at the relevant date. Indeed, in one respect, the reference to Dr Stillger’s “report” of 24 December 2014 as not supporting the Plaintiff being TPD appears incorrect because the date appears wrong and because the report of 2 October 2014, which appears to be the closest one in time to the “report” identified, does, in fact, support the Plaintiff being TPD.

325. A similar issue arises with the last report listed, being the report of Dr Danny Buchanan of 27 April 2016. There is a report of Dr Buchanan from 2011 in the documents (Ex. A/318 – 319) but there is none of April 2016, the subject of the evidence.

326. The TPD Claim Summary dated 23 November 2016 referred to the definition of TPD in the Policy, as being “the Insured Member has been continuously unable to work because of injury or illness for the TPD Waiting Period”. It also referred to “in the Insurer’s opinion … the Insured Member is unable ever again to work for reward in any business, occupation or regular duties for which … she is reasonably qualified by education, training or experience”.

327. However, the Insurer did not seem to give detailed consideration to the definition of business, occupation or regular duties where the Insured Member was working at least 15 hours per week at the Date of Disablement as “full-time business, occupation or regular duties” (my emphasis). In this regard, the concept of business, occupation or regular duties for which the Insured Person is reasonably fitted by education, training or experience directs attention to the insured’s vocational history to date, and to occupations for which that vocational history fits the insured.

328. Unlike Manglicmot v Commonwealth Bank Officers Superannuation Corporation Pty Ltd, in which the relevant clause of the policy was silent in respect of whether the insured was able to resume occupation on a full-time or part-time basis, in the present case, the definition, in the Policy, explicitly referred to “full-time business, occupation or regular duties”. The inclusion of that reference was, therefore, a necessary consideration for the Insurer.

329. Furthermore, although the words “unable ever” in the Policy incorporate a more stringent test than “unlikely ever” (in some other policies), the former phrase is qualified by the reference to the ability to resume full-time business, occupation or regular duties. In either case, the word “ever” alters the test that would apply in its absence. The adverb requires that the opinion be not merely about the present, but about the relevant future as well.

330. Whilst the TPD Final Claim Summary did not specifically identify any vocational options that the Plaintiff could perform bearing in mind the conditions from which she was suffering and the medications which she was being prescribed, there was evidence, provided in the Job Capacity Assessment Report of December 2010, that there was some work that she could do. However, importantly, her capacity, in relation to such work, was limited to part-time work, that is less than 15 hours per week.

331. There was no reference in the Job Capacity Assessment Report of December 2010 that she could work for more than 14 hours per week, even with “intervention”.

332. The Insurer had no basis upon which to reject the Job Capacity Assessment Report so far as it related to the Plaintiff’s limitations caused by the psychological conditions from which the Plaintiff was said to have been suffering in July 2008. Nor did it provide any criticism of the Job Capacity Assessment Report as having suggested that the Plaintiff was likely to be only able to work a maximum of 14 hours per week.

333. There was no evidence of any other assessment of the Plaintiff’s suitability for future full-time employment as at July 2008. The Insurer does not appear to have sought such evidence and did not raise that matter with the legal representative of the Plaintiff.

334. Also, there was no other reference to the Insurer having considered the requirement relating to her ability to work “full-time” in any business, occupation or regular duties for which she was reasonably qualified by education, training or experience.

335. The TPD Final Claim Summary did not identify any categories of full-time work in the business, occupation or regular duties, for which the Plaintiff was reasonably qualified by education, training or experience, which she would be able to perform. That she was able to maintain her academic studies in Social Work throughout 2008 would not, necessarily, go to whether she was continuously unable to work because of injury or illness for 6 months after the Date of Disablement, or for that matter, thereafter. After all, her studies were conducted off campus via online, telephone and correspondence attendance, which was not what was required for being, again, able to “work for reward in any business, occupation or regular duties for which … she is reasonably qualified by education, training or experience”.

310. Yet, as stated, the definition of TPD did not turn on the Insurer forming an opinion that the Plaintiff was unlikely ever again to be able to resume work, but the higher threshold that, at the assessment date, she was unable to do so. In coming to its opinion, the Insurer was entitled to consider not only whether she could resume work as a social worker, but also whether there were other occupations (namely, occupations or work for which she was reasonably qualified by reason of education, training or experience) that she would be able to perform. In this regard, her extensive education, training and experience, were relevant matters. However, whatever business, occupation or regular duties that she was required to perform would have to involve working on a full-time basis.

311. There was no information available to the Insurer as to the requirements of any full-time vocational option, or as to the prospects of the Plaintiff obtaining any full-time business, occupation or regular duties, which would take into account her psychological condition. Even if there had been, there was no information provided as to the availability of suitable employment in the area where the Plaintiff lived as at July 2008.

312. Indeed, the Job Capacity Assessment Report to which reference has been made, even though it referred to the physical limitations caused by the event in September 2009, pointed out that the primary condition was her psychological condition (Personality Disorder), said to have been “fully diagnosed, treated and stabilised”, which was limiting her capacity to work more than 14 hours per week.

313. It is also correct to say that none of the medical records relating to the period between when she ceased work and 25 (or 28) July 2008, recorded that the Plaintiff was unable to engage in work in the business, occupation or regular duties, for which the Plaintiff was reasonably qualified by education, training or experience, whether on a full-time, or part-time, basis. Indeed, Dr Kirkman, in his report of October 2010, suggested that the Plaintiff ought to return to work, albeit that he doubted that “she can work as a social worker”.

314. However, it is not clear from the report whether Dr Kirkman was opining that any work she would be able to do, would be on a full-time basis. Reading the report as a whole, I favour the view that it is more likely than not he was referring to part-time, rather than full-time, work, particularly since he makes reference to her agoraphobia. What is clear from the report is that her psychological conditions provided obstacles to her performing work.

315. Taken overall, the decision in the TPD Final Claim Summary reflected a failure by the Insurer to consider whether, in the real world, “full-time business, occupation or regular duties” for a person suffering from the psychological condition from which the Plaintiff was suffering, and who was taking both anti-depressant, and anxiolytic, medication, was reasonably available. In this regard, the opinion formed by the Insurer was not open to it acting reasonably and fairly in the consideration of the claim.

316. In my view, the Insurer took too narrow a view of the concept of being unable ever again to work for reward, carrying out full-time business, occupation or regular duties for which she was reasonably qualified by education, training or experience, by failing to have due regard to the psychological obstacles, and difficulties with memory, and competitive disadvantages that would be likely to adversely impact upon her ability to do so.

317. The Insurer also failed to consider, in any meaningful way, the effect of the medication which the Plaintiff was being prescribed for her psychological condition. Thus, the Insurer failed to take into account a significant component of the Plaintiff’s incapacity.

318. It was also incorrect to state, as the Insurer did, that “[T]he medical evidence indicates that, in and after July 2008, your client reported panic attacks, agoraphobia, and increasing panic, all of which were attributed by her medical practitioners to a temporary stressor, being a Court trial in which your client was involved”.

319. The medical records clearly indicated that the psychological condition had been exacerbated as a result of the temporary stressor, not that they were caused by that temporary stressor.

320. Then, even though the Insurer was entitled to consider that the Plaintiff’s condition appeared to have improved after the trial in 2008, she had not completely recovered and some of the symptoms persisted.

321. These acts and omissions are relevant to whether the view taken by the Insurer can be shown to have been unreasonable on the material then before it in forming the opinion that the Plaintiff would be unable ever again to work for reward, full-time, in any business, occupation or regular duties for which she was reasonably qualified by education, training or experience. In this regard, the clause of the Policy required the Insurer to examine the occupations for which the Plaintiff was fitted in the sense of the occupations for which her education, training and experience had prepared her. That was, naturally, shaped by her vocational history, which for the most part was limited to areas of social work.

322. The acts and omissions are also relevant to the question whether the Insurer had not considered the correct question, and that, in considering that question and informing itself as to matters relevant to its determination, it had not acted fairly and reasonably. Overall, they lead me to conclude that the Insurer’s decision was vitiated for each of these reasons, with the result that the decision in the TPD Final Claim Summary dated 23 November 2016 is vitiated.

323. If the TPD Final Claim Summary dated 23 November 2016 is to be read with the letter dated 27 September 2017, so as to constitute the first declinature, as was submitted by the Insurer, that letter also must be considered.

324. Again, whilst there is a reference to the definition of TPD in the Policy, there is no real consideration given to the definition of business, occupation or regular duties where the Insured Member was working at least 15 hours per week at the Date of Disablement as “full-time business, occupation or regular duties”.

325. In relation to the letter dated 27 September 2017, the suggestion that the “medical evidence does not show that [the Plaintiff] was reporting any significant symptoms or consulting any doctor in relation to her claimed conditions” does not seem to take into account, particularly, the Patient Notes. I have referred to these earlier.

326. Yet the letter, made specific reference to the Plaintiff continuing to take the anti-depressant and anxiolytic medication, and being “better with medication”. However, how the requirement to continue to take the medication in order to remain “better” would affect her ability to work “full-time” was not identified.

327. Whilst it is true that the Plaintiff’s condition was recorded as being “good at present” and “well”, and that the panic attacks were being controlled by medication, there was the reference to the medication continuing to be prescribed. It is clear that throughout the period between January and July 2008, the Plaintiff was continuing to take the prescribed medication at a time when she was not working at all. It was not suggested that she was not required to do so.

328. Again, the Job Capacity Assessment Report, although provided in December 2010, highlighted the primary psychological condition. As stated previously, it did not suggest any real possibility of the Plaintiff returning to full-time work.

329. Some of the other omissions to which reference has been made in relation to the TPD Final Claim Summary are also apt to this letter also. Most importantly, there was a failure to deal with the issue of the Plaintiff’s ability to engage in full-time work.

330. Therefore, for these reasons, I am of the view that, in relation to the letter of September 2017, to the extent that it constitutes the declinature, there was an error on the Insurer’s part, in that it did have appropriate regard to all of the information available to it. Nor did it form an opinion that was reasonably open to it.

331. I then turn to the letter dated 16 February 2018 sent by the Insurer to the Plaintiff’s solicitors. In this letter, the Insurer stated that “[I]t remains the case that your client does not appear to have described any substantial symptoms at or about the time that she ceased work”. In this letter, there was a reference to some of the medication prescribed to the Plaintiff, namely Kalma and Pariet (Ex. A/272). I have referred to the other medication which was prescribed and which it appears she was taking.

332. In this letter, the Insurer acknowledged that in and after July 2008, the Plaintiff was still suffering from a stressor, albeit that it was regarded as being a “temporary” one. It made reference to her having experienced improvement and described her condition as being diagnosed “in relatively positive terms”. Indeed, the continuation of her psychological conditions is referred to as “having been substantially reduced” by the time of the assault.

333. The letter referred to the subsequent assault in September 2009, which it stated had “resulted in an exacerbation of her psychological symptoms” (my emphasis). It is clear, in this letter, the Insurer accepted that the Plaintiff’s psychological condition and the symptoms continued after January 2008 and into 2009.

334. (Later in the letter there is a reference to the other physical conditions which arose after July 2008.)

335. The letter referred then to “a positive opinion that the necessary adverse prognosis applied as at July 2008”, without identifying the prognosis to which it was referring, and then goes on to repeat “the severity of her symptoms after September 2009 is (in large part) attributable to the assault”.

336. I have earlier referred to the conclusion in that letter. That conclusion (at Ex. A/276) makes no reference at all to the definition requiring the Plaintiff returning to full-time work or the medication that the Plaintiff was prescribed and its effect on her capacity to engage in full-time work.

337. I shall not refer again to the other matters of omission referred to in this letter (to which I have earlier referred in relation to the earlier declinature). It follows that I am satisfied that there was an error on the Insurer’s part, in that the Insurer did not give appropriate regard to all of the information available to it. Nor did it form an opinion that was reasonably open to it.

338. I consider, bearing in mind the time taken to get to this point, it being remembered that the Plaintiff ceased work over 10 years ago, that this Court should now determine whether, on the material available to it, the Plaintiff’s claim falls within the Policy: Hannover Life Re of Australasia Ltd v Jones, at [86].

339. (I have not forgotten what was written by Basten JA in his separate judgment in Birdsall v Motor Trades Association of Australia Superannuation Fund Pty Ltd, at [25] – [28], but I note that neither of the other judges (Meagher JA; Gleeson JA agreeing) suggested that the existing line of authority needed reconsideration.)

340. The first issue for consideration by the Court is whether the Plaintiff was continuously unable to work because of injury or illness for 6 months after the Date of Disablement. In this regard, I am satisfied that the psychological condition from which the Plaintiff suffered was an “illness” within the meaning of that term in the Policy.

341. I am also satisfied that it was because of this illness, that she was continuously unable to work for the 6 months 25 (or 28) January 2008. I have referred to the apparent acceptance, in the correspondence, by the Insurer, that the psychological condition from which the Plaintiff was suffering in January 2008, whilst it was improving, had not resolved completely. Indeed, it was exacerbated by the additional stressors of the Plaintiff’s mother’s illness which prompted more responsibilities to be placed on the Plaintiff’s shoulders, and the additional studying for the PhD.

342. The issue, then, is whether the Court is satisfied that the definition of TPD has been satisfied. This requires more than the Court being satisfied that the Plaintiff was unlikely ever again to be able to resume work. Rather, the Court must be satisfied that she was, at the assessment date of 25 (or 28) July 2008, unable to do so.

343. In coming to this opinion, the Court considers not only whether she could resume work as a social worker, but also whether there were other occupations (namely, occupations or work for which she was reasonably qualified by reason of education, training or experience) which she would be able to perform on a full-time basis. In this regard, her extensive education training and experience are relevant matters to consider.

344. In the present case, I do not think that the issue of the relevance of geographical limitations on employment play any substantial role, as I am satisfied that, as at July 2008, the requirement relating to her inability to work “full-time” in any business, occupation or regular duties for which she was reasonably qualified by education, training or experience, was satisfied.

345. It is likely that she could have undergone some retraining. Yet, in my view, the psychological condition, from which I am satisfied the Plaintiff suffered at the time she ceased work in January 2008, and which continued throughout the 6 month period thereafter, would have prevented her from working work “full-time” in any business, occupation or regular duties for which she was reasonably qualified by education, training or experience. It was not suggested to her, in cross-examination, that she had a tendency to underplay her actual capacities prior to, or during, 2008.

346. The Court has proceeded to the second stage inquiry and assessed for itself whether the Plaintiff is TPD within the Policy as at the time for assessment, being 25 (or 28) July 2008 and finds that she is. In my view, the Plaintiff was, as at 25 (or 28) January 2008, and for the 6 month period thereafter, an extremely vulnerable personality who was unlikely to be able to deal with the stressors of everyday life, and particularly everyday working life, particularly working life as a social worker.

347. In my view, her condition was likely to continue thereafter as there was no suggestion of any resolution of the psychological condition. Her continued medication, albeit, in varying doses, would not assist in this regard.

348. The Plaintiff, therefore, is entitled to a declaration to that effect and orders that the Insurer pay the sum of $90,000, plus interest, to the Trustee, for distribution to the Plaintiff.

349. I require the parties to discuss the issue of interest and, if agreement cannot be reached I shall hear further argument. As there may be an application for a special costs order, I shall also allow for that possibility and for the parties to formulate the declarations and orders in the form they consider appropriate also bearing in mind the dismissal of the proceedings against the Trustee.

350. The proceedings will be adjourned to a date to be fixed for the making of orders and for any further argument on the outstanding issues of interest and costs. If agreement is reached and signed Short Minutes of Orders are delivered to my Chambers in hard and soft copy, I shall deal with the balance of the matter in Chambers and vacate the date to which the matter is adjourned.

351. The Court:

1. Directs the parties to bring in Short Minutes of Order to give effect to these reasons.

2. Lists the proceedings for mention for any argument on interest, costs or other consequential issues, on a date to be arranged at the date of the publication of these reasons.

3. Grants liberty to apply.

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Decision last updated: 11 October 2018