Green v AMP Life Ltd & Ors

[2006] HCATrans 133

[2006] HCATrans 133

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S551 of 2005

B e t w e e n -

GARY SYDNEY GREEN

Applicant

and

AMP LIFE LIMITED

First Respondent

ROGER PATTERSON

Second Respondent

JOHN KELLY

Third Respondent

KEVIN McLEAN

Fourth Respondent

Application for special leave to appeal

HAYNE J
HEYDON J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 10 MARCH 2006, AT 11.47 AM

Copyright in the High Court of Australia

__________________

MR M.J. HEATH:   If it please your Honours, I appear for the applicant. (instructed by Wright Pavuk)

MR N. PERRAM:   May it please the Court, I appear with my learned friend, MR B.L. JONES, for the respondent.  (instructed by Mallesons Stephen Jaques)

HAYNE J:   Yes, Mr Heath.

MR HEATH:   If your Honours please, I sought to supplement the written submissions by seeking to make two points to your Honours in relation to the special leave application.  The first of those points relates to the Life Insurance Act and the second of those points relate to the direct contract point.  If I can deal with the Life Insurance Act point, your Honours, in my respectful submission, this is a case where it is submitted special leave should be granted because it is a matter of general importance.  The relevant issue, your Honour, is whether the Life Insurance Act 1995 requires in this case variations to an insurance policy to be in writing before they can issue to have effect. That is how I have sought to articulate that special leave point, your Honours.

Your Honours, the importance of that matter relates, obviously, to federal statute so it is of national implications in relation to insurance policies.  Secondly, it has a potential effect on many people who are the beneficiaries of group policies.

HAYNE J:   What would be the provision or the provisions that would have this consequence?

MR HEATH:   Your Honours, in my respectful submission, one starts with the dictionary part of the relevant Act.  If your Honour has the copies of the Act, it is the last page, page 257, of the extracts that I have pointed to your Honours.  Your Honours will see there is a definition of “policy” and there is also a definition of “policy document”.  The various extracts that I have taken to your Honours – and they

are not exhaustive – refer to a number of concepts, that is, are policy issues or policy documents.  If one starts with section 10, for example, one sees that there is reference to:

(a)a life company issues a policy when the company enters into the contract that constitutes that policy; and

(b)a policy is issued to the person –

If one starts with that concept, in my respectful submission, it conveys the notion that something is being issued to a person by being delivered to that person in writing. 

Your Honours will see that there is a range of sections where this issue of policy document and policy issue is identified.  Section 35 at page 151 is one such area.  There is also section 116 and, your Honours, there is also 198 which was referred to in the Court of Appeal.  There is also 200 which refers to an assignment of a policy which refers to a policy document being the document that has to be assigned.  Your Honours will also see there is a transfer of policy, section 203, where a policy has been issued or assigned.  Perhaps where it is most apt, if your Honours look at section 221, which is at page 233 of the extracts, you will see there is reference to lost and destroyed policies and how replacement policies are to be dealt with, and section 222 refers to:

A replacement of a policy document:

(a)      must, as far as possible:

(i)be a copy of the original policy document;

So, your Honours, if one takes the context of the Act as a whole – and the Court of Appeal seemed to accept this, your Honours, that the natural inference of the statute was that there had to be a policy document in writing, and, in our respectful submission, a variation must be the same.  Your Honours, I will just deal specifically with the suitable vehicle question and that is, in my respectful submission, if this aspect is correct, then it is a suitable vehicle because it clearly raises the question and ‑ ‑ ‑

HEYDON J:   What do you say to the respondent’s contention that this argument was not run at the trial and they would have run their case differently had it been?

MR HEATH:   Your Honour, I have two responses to that.  First of all, that is not quite correct and that is for this reason.  If your Honours go to the application book at page 35, there is an extract of the transcript at line 50, at the bottom of the page.  You will see there is an extract from myself:

Could I do one thing, I just want to make one short point to your Honour that occurred to me. The short point I wanted to make is in relation to this question of whether a policy is required to be written, I think there is no express requirement anywhere that we can locate that it requires policy of insurance to [be] written. I invite your Honour to go back to 116 of the Life Insurance Act. Your Honour will recall I made a submission about what is comprehended is a written document –

In fairness to his Honour, his Honour said, over the page, “Look, if there was a failure to comply with that, what effect would it have?” But the point about it is that answer followed upon a question asked by his Honour of me at page 33 of the application book where his Honour specifically asks at line 35, “I haven’t looked at this but is there anything in the Life Insurance Act” as to whether there is a requirement in writing. The next point in relation to that issue is ‑ ‑ ‑

HAYNE J:   Just before you part from that, do we have all of the pleadings or the relevant pleadings?

MR HEATH:   No, not in the application book, your Honours.

HAYNE J:   Is there anything you would point to in the pleadings that would show that the point was ‑ ‑ ‑

MR HEATH:   No, your Honour.

HAYNE J:   That is, there is nothing in the pleadings that would show it to be a live issue at trial?

MR HEATH:   I do not believe so, your Honour, but I would have to check it.  Can I raise this point, your Honour?  Your Honours, the other issue is that Justice Campbell did himself go back to look at this issue and made a finding on it.  If your Honours look at the application book at page 88, your Honours will see at line 10:

There is no statutory requirement under the Life Insurance Act (Cth) for a policy of life insurance to be in writing.

So in terms of it being dealt with below, your Honours, it was in that sense.  It is true that I took it to a greater depth in the Court of Appeal, particularly by referring to section 198, but it is not correct to say that it was not dealt with below.  It is for that reason, when my learned friend refers to Suttor’s Case, that is not an adequate analogy in this particular case because that was a case where a new defence was sought to be raised on appeal completely and no reference made at all in the court below.

HAYNE J:   But it is sought to be put against you, is it not, that estoppels would have been pleaded and evidence led in aid of estoppels?

MR HEATH:   So it is said, your Honour, but the fact of the matter is if that were in truth true, if the matter was clearly raised, firstly, by his Honour in the initial question to me and, secondly, in the passage of transcript relating to section 116 that I referred your Honours to, it became a live issue at that point and ultimately his Honour made a specific finding about it.  If there was going to be any issue about estoppels and the like, as my learned friend says, that was the time to deal with it.  With respect, your Honour, it is not as if he got up at that point saying, “Well, if this is going to happen, I need to do these following things”.  So, in my respectful submission, it is for that reason that the issue of what my learned friend might have done does not really arise in this particular case.

Your Honour, the other thing that is put against me is the section 230 point which his Honour Justice Basten refers to in the judgment. Your Honour will see that that appears at page 144 of the application book where his Honour extracts the section. Your Honours will see that the section is a short section. It says:

A life company’s failure to comply with this Act does not invalidate any life policy issued by the company

Therefore his Honour goes on to say that:

Thus assuming that the Act did require that a variation of policy be in writing, and assuming that the variation in the present case was not (at a relevant time) in written form, it may nevertheless been valid.

Your Honour, that is an error, in my respectful submission, and that relates to the second aspect of my life insurance point for special leave that this aspect becomes a question of error correction, in my respectful submission, that is this.  His Honour said if the Life Insurance Act did require that the variation be in writing, then his Honour said that the relevant writing was in sufficient compliance with the Act.  Your Honour, that is not so.  It is not so for this reason.  The relevant written document was the customer information brochure.  That was the relevant document that contained reference to the two-year limitation period but, your Honours, that could not have been for this purpose of the Act compliant with the Act because, your Honour, that document itself ‑ ‑ ‑

HAYNE J:   Compliance with the Act in what respect?

MR HEATH:   That his Honour was suggesting at this part of the judgment that the customer information brochure constituted sufficient variation, constituted sufficient compliance of the variation being reduced to writing for the purpose of the Life Insurance Act.  Now, your Honours, I have two points to make about that.  The first is, in my respectful submission, that cannot be right.  The reason why is that the customer information brochure was just that:  a customer information brochure.  It in terms said, your Honours, that it was only a summary of the policy document and that in the event of a dispute one had to refer back to the policy document.

So insofar as the Court of Appeal sought to say that the customer information brochure constituted a reduction of the variation into writing, it could not be.  It could not be because that document itself was merely a summary of the policy terms and reliance had to be placed on the policy document and it said so in terms.

Your Honour, that part is extracted in Justice Campbell’s judgment where he extracts the various parts of the brochure.  It is at page 76 of the application book, line 45, under the heading “Trust Deed” at the bottom of the page.  His Honour has extracted here from the brochures, your Honour, and your Honours will see that this is what I mean:

The Plan is owned by Trustees under a Trust Deed.  The Trustees have chosen to purchase a policy with AMP to provide income protection to advisers.  This brochure is a summary of the policy’s main provisions.  The wording of the Policy Document will always be regarded as the final authority –

It was this document, your Honour, that Justice Basten appeared to say constituted sufficient compliance for the purpose of section 230 and that could not be so.

Further, your Honour, I think my learned friend in his submissions suggested that the written document at page 173 of the application book was the memorandum of alteration.  Your Honour, this was a memorandum of alteration that was dated 5 August 2004 in which my learned friend sought to run a rectification case to amend the policy in terms of the memorandum of alteration.  It could not have been that document that the Court of Appeal was referring to because it simply did not come into existence until well after these proceedings had first commenced.

Your Honours, there is a subsidiary point in relation to the section 230 point and that is this, that if the Life Insurance Act did not require policies to be reduced to writing, then on the facts of this case it would have application.  However, if the Life Insurance Act did require a variation to be in writing, and it was not, then section 30 simply had the effect of saying that the non‑compliance of it being in writing simply meant that the policy that had been issued in writing was not invalidated.

HAYNE J:   This aspect of your argument – correct me if I am wrong – all of your argument hinges, does it not, upon the proposition that there is no distinction between a policy and a policy document?

MR HEATH:   It hinges upon the argument that the Life Insurance Act requires a written document and in that sense – if that answers your Honour’s question.  Your Honours, in relation to this second aspect, that is the idea that somehow this brochure could constitute a relevant written document for the purpose of the Life Insurance Act when, in its own terms, it was not the policy and it said so, is an error of principle of such importance, in my respectful submission, that justifies leaving this particular case and this is again an appropriate vehicle for such a point because it squarely raises the issue and in terms of general importance people, I suppose, get customer brochures every day of the week.  So that is why it would be a matter of importance as well as being a suitable vehicle if your Honours are with me that the error of principle that I have set out is one that is sufficiently arguable.

Your Honours, it had been my intention to move on to the question of the direct contract.  Again this is an error of principle in the approach in failing to find ‑ ‑ ‑

HEYDON J:   This is another argument to which the respondent says that it was not advanced before the trial judge.

MR HEATH:   Again, your Honour, with respect, that is not quite right and for two reasons.  First of all, it was dealt with in the transcript.  If your Honours goes to page 44, there was discussion about this.  If your Honours go to line 40, this is again extract from the transcript and the extract that I am seeking to take your Honours to is responses by Mr Perram in response to questions from his Honour:

It does not arise on the contract, direct contractual claim.

Then if your Honour goes further down to line 50:

If my friend is right and the policy relates to numerous contracts, it would be impossible for the claim to be amended that way.  That is another difficulty with his argument because it generates many hundreds of insurance contracts.

That is the first point in relation to the transcript question and this was, generally speaking, the subject of some debate between – there is some question of argument or submission in response to questions of Justice Campbell of myself and Mr Perram.  Not only is it raised to that extent in the transcript, your Honours, it was also raised in submissions by me and those submissions are extracted at application book 26.  Now, I accept that it is not in an extensive form but if your Honours go to line 30 your Honours will see:

There is no dispute that the plaintiff had a right of action against AMP.  That right is in contract.

The last issue why it is not true to say that it was not dealt with below, your Honours, is Justice Campbell’s own reasoning where his Honour dealt with this in some detail but came to the conclusion at the end of the day that he was not satisfied that it was squarely argued.  His Honour was not indicating that it was not argued at all, but his Honour in fact analysed the situation and he did so, your Honours – it is probably best encapsulated at application book 108 and 109.

Your Honours will see that Justice Campbell at line 40 starts with Trident and then seeks to set out a direct contractual analysis.  That begins at 109 at line 20:

I can see a possible argument that in this situation there is a contract between AMP and each individual Member of the Plan –

and his Honour then goes on to set out what that is and then over the page, at page 110, his Honour goes on to say that he was not satisfied the matter had been “squarely argued” but nevertheless made the analysis.

So at least at three points, your Honours, it was raised below, in submissions, in the transcript and in his Honour’s judgment, a very similar situation to what occurred in relation to the Life Insurance Act.  So for that reason, to the extent that my friend says that he would have led a different case, again it is not as if, at the time that this issue was being debated, he was raising the question that he might be seeking to call different evidence or do some other things that might be different.

Your Honours, I need to disclose one matter in relation to the direct contractual point and it relates to the submissions.  If your Honours go to the Court of Appeal decision on the question of other matters which is at 148 and also in relation to the applicant’s submissions where – I will try and explain it this way.  What happened was the Court of Appeal dismissed the direct contractual point saying the argument fell away if there was no

variation to the contract.  In other words, it was premised on there being a variation to the contract. 

I should disclose to your Honours that in the course of the transcript my learned friend did not raise it, has not raised it, but in the course of the debate, Justice Basten did ask me at one stage a question to the effect of, “Did the argument fall away if there was a variation to the contract?” and the best of my recollection was that I may have responded yes to that question when, in fact, the truth is it would not.  In other words, if there was a variation, the direct contract point still would have arisen, the variation just would not have been binding on my client.

HAYNE J:   Thank you, Mr Heath.  We need not trouble you, Mr Perram.

There are insufficient prospects of success of an appeal to warrant a grant of special leave to appeal in this matter.  Special leave is accordingly refused with costs.

AT 12.08 PM THE MATTER WAS CONCLUDED