Long v Is Industry Fund Pty Ltd - [2020] NSWSC 1151

Supreme Court

New South Wales

Medium Neutral Citation: Long v IS Industry Fund Pty Ltd [2020] NSWSC 1151
Hearing dates: 4 and 5 February 2020, 1 May 2020
Decision date: 27 August 2020
Jurisdiction: Equity
Before: Robb J
Decision:
See par [406]. Parties should confer and provide to my Associate short minutes of order to give effect to these reasons for judgment.

Catchwords:
INSURANCE — Life insurance — Accident and sickness — total and permanent disablement — where the second defendant had rejected the claim of the plaintiff on numerous occasions — where, on the proper construction of the Policy, the inability to do any work as a result of Injury or Illness for six consecutive months only relates to periods of six consecutive months that commence at the end of a six month period that satisfies the relevant work requirements — where, on the proper construction of the Policy, the direct cause of the contract of employment being terminated was immaterial — where the second defendant acted on an incorrect construction of the Policy in the third and fourth rejections — where the process of reasoning adopted by the second defendant was not reasonable with respect to the third and fourth rejections

Legislation Cited:
Insurance Contracts Act 1984 (Cth)

Cases Cited:
Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223
Birdsall v Motor Trades Association of Australia Superannuation Fund Pty Ltd [2015] NSWCA 104
Chammas v Harwood Nominees Pty Ltd (1993) 7 ANZ Ins Cas 61-175
Edwards v Hunter Valley Co-op Dairy Co Ltd (1992) 7 ANZ Ins Cas 61-113
Hannover Life Re of Australasia Ltd v Colella (2014) 47 VR 1; [2014] VSCA 205
Hannover Life Re of Australasia Ltd v Jones [2017] NSWCA 233
Hannover Life Re of Australasia Ltd v Sayseng [2005] NSWCA 214
Hellessey v MetLife Insurance Ltd [2017] NSWSC 1284
Ivan Mabbett v Watson Wyatt Superannuation Pty Ltd [2008] NSWSC 365
Manglicmot v Commonwealth Bank Officers Superannuation Corporation Pty Ltd [2011] NSWCA 204; (2011) 282 ALR 167
McCann v Switzerland Insurance Australia Ltd (2000) 203 CLR 579; [2000] HCA 65
MetLife Insurance Ltd v Hellessey [2018] NSWCA 307
MetLife Insurance Ltd v MX [2019] NSWCA 228
PaulWeber v Tiss Pty Ltd [2005] NSWSC 67
Peppers Hotel Management Pty Ltd v Hotel Capital Partners Ltd [2004] NSWCA 114
Shuetrim v FSS Trustee Corporation [2015] NSWSC 464
Standley v Onepath Life Pty Ltd [2020] NSWSC 848
TAL Life Ltd v Shuetrim (2016) 91 NSWLR 439; [2016] NSWCA 68
Wheeler v FSS Trustee Corporation as trustee for the First State Superannuation Scheme [2016] NSWSC 534

Category: Principal judgment
Parties: Martin Long (plaintiff)
IS Industry Fund Pty Ltd (first defendant)
Hannover Life Re of Australasia Ltd (second defendant)
Representation:
Counsel: A Coombes (plaintiff)
I Wylie (sol) (defendants)
Solicitors: Firths (plaintiff)
William Roberts Lawyers (defendants)

File Number(s): 2018 / 374473

Judgment

Introduction

The plaintiff is Mr Martin Long. He was born on 18 March 1965, and is presently 55 years of…

Grounds of appeal

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

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

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

Consideration

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

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

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Details

Case: [2020] NSWSC 1151
Decision Date: 27 August 2020

CaseChat Overview and Summary

Long v Is Industry Fund Pty Ltd is a case involving the plaintiff, who had made a claim for total and permanent disablement benefits under a life insurance policy held with the second defendant, Is Industry Fund Pty Ltd. The plaintiff's claim was rejected on several occasions, leading to the legal dispute. The court was tasked with determining the validity of the second defendant's repeated rejections of the claim and the interpretation of specific policy provisions related to total and permanent disablement.

The primary legal issue before the court was the interpretation of certain clauses within the insurance policy, specifically those related to the definition of total and permanent disablement. The court had to determine whether the plaintiff's inability to work for six consecutive months, as required by the policy, related to periods of six consecutive months that began at the end of a six-month period that satisfied the relevant work requirements. Additionally, the court examined whether the second defendant's reliance on an incorrect interpretation of the policy and their unreasonable process of reasoning in the third and fourth rejections warranted any relief for the plaintiff.

The court held that the second defendant's rejections of the plaintiff's claim were based on an incorrect construction of the policy. The court found that the six-consecutive-month period for total and permanent disablement should be interpreted as periods that commence at the end of a six-month period that satisfies the relevant work requirements. The court also determined that the direct cause of the contract of employment being terminated was immaterial under the policy terms. Furthermore, the court concluded that the second defendant's process of reasoning in the third and fourth rejections was not reasonable, leading to an order in favour of the plaintiff.

Consequently, the court made an order that the second defendant pay the plaintiff the total and permanent disablement benefits under the policy, along with interest and costs. The court found that the second defendant's actions in rejecting the plaintiff's claim were not justified, and the plaintiff was entitled to the benefits as per the correct interpretation of the policy.

Orders