Maryanne Moise v Permanent Trustee Company Limited

[2004] NSWSC 1179

CITATION:	Maryanne Moise v Permanent Trustee Company Limited [2004] NSWSC 1179
HEARING DATE(S):	1/12/04
JUDGMENT DATE:	8 December 2004
JURISDICTION:	Equity Division
JUDGMENT OF:	Brownie AJ
DECISION:	Motion dismissed.
CATCHWORDS:	Pleading - No question of principle
PARTIES :	Maryanne Moise (Plaintiff) Permanent Trustee Company Limited (Defendant)
FILE NUMBER(S):	SC 5314/03
COUNSEL:	J Mrsic (Plaintiff) V Heath (Defendant)
SOLICITORS:	Carroll O'Dea (Plaintiff) Blake Dawson Waldron (Defendant)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

Brownie AJ

Wednesday 8 December 2004

5314/03 Maryanne Moise v Permanent Trustee Company Limited

JUDGMENT

1 This action was commenced by summons. The defendant complained that it should have been commenced by statement of claim, and by notice of motion dated 4 June 2004 it sought an order that the plaintiff file a statement of claim. The plaintiff did that on 30 September 2004, so that this part of the motion no longer needs to be considered. However, in the notice of motion the defendant also sought an order under part 13 rule 5 dismissing the summons, as disclosing no cause of action. The parties debated this part of the motion, and also the defendant’s claim that the whole or part of the statement of claim now filed should be struck out as disclosing no cause of action.

2 The statement of claim pleads some facts, said to entitle the plaintiff to be paid certain money, payable out of a superannuation fund. The original trustee of that fund was KPMG Peat Marwick Custodians Pty Limited, but the present trustee is Permanent Trustee Company Limited, and it is agreed, at least for present purposes, that it is in the same position as the original trustee. The former trustee procured a policy of life assurance providing amongst other things for the payment of money to the plaintiff if she suffered total and permanent disablement. The terms of the superannuation fund provided for the payment of the same money to the plaintiff if in the opinion of the trustee she was, in substance, suffering from total and permanent disablement. Paragraph 19 of the statement of claim asserts the breach by the defendant of the duty that it (and/or the former trustee) owed to the plaintiff, as trustee. There are 21 alleged breaches of duty arranged by reference to the letters (a) – (u) in the particulars appended to paragraph 19. The defendant says, and I do not understand the plaintiff to deny that sub-paragraphs (a) – (c) of paragraph 19 contain assertions of breaches of duty, but not particulars properly so called, so that the question to be decided now is whether any of the particulars (d) – (u) inclusive can be regarded as supporting the general claim of breach of duty as trustee, expanded by reference to sub-paragraphs (a) – (c), which are in these terms:

(a) Failing to act in good faith.

(b) Failing to give a real and genuine consideration to the claim.

(c) Not exercising its discretion in accordance with the purposes for which it was conferred.

3 The parties agreed upon certain facts. The document setting out this agreement contains cross references to many other documents, but those other documents are not in evidence. I consider that for the purposes of deciding the present application I can state the facts even more briefly.

4 The plaintiff’s claim is that she is totally and permanently disabled. She lodged a claim to this effect, supported by reports from three medical practitioners, Drs Wakefield, Mercurio and Champion. The insurer had the plaintiff examined by Dr Stevenson, who reported adversely to the plaintiff’s claim, and the insurer declined to meet the claim then made upon it by the former trustee. The former trustee then arranged for the plaintiff to be examined by Dr Richards, who reported favourably to the plaintiff. Each of Drs Stevenson and Richards then re-examined the plaintiff, but neither changed his position. Then the insurer confirmed its denial of the claim made by the former trustee, but then it agreed to reconsider its position, after the examination of the plaintiff by two further medical practitioners, Drs Lee and Katelaris.

5 The former trustee then provided the plaintiff with copies of the reports of Dr Richards, and of correspondence between itself and the insurer regarding the basis of its position. The plaintiff’s solicitors then wrote to the trustee requesting copies of the reports of Drs Lee, Katelaris and Stevenson; and the trustee wrote to the insurer requesting its consent to the release of these reports. I am uncertain of the precise sequence of events, but it is agreed that Dr Lee did not support the plaintiff’s claim; and that Dr Katelaris initially did support the claim, but that she subsequently reported that, having seen a surveillance video tape taken of the plaintiff, she considered that the activities of the plaintiff depicted on the tape showed that the plaintiff had capabilities inconsistent with the history given to the doctor by the plaintiff.

6 During July 2000 the trustee wrote two letters. One was to the insurer asking it to make available a copy of the video tape in relation to the plaintiff, and the other was to the plaintiff ’s solicitors forwarding copies of the reports of Drs Lee and Katelaris, informing the plaintiff of the insurer’s denial of the claim and the basis upon which it was denied, and seeking a response from the plaintiff. The plaintiff did not respond to the latter letter before 2 October 2000, when the trustee denied the plaintiff’s claim. Later that month, the plaintiff’s solicitors requested a copy of the video tape, requested copies of the report of Dr Stevenson, and requested the trustee to reconsider the plaintiff’s claim. The trustee requested the insurer to reconsider its denial of liability, having regard to the submissions made on behalf of the plaintiff. The insurer declined to release the tape, and the plaintiff’s solicitors were informed of this, although the trustee provided to them copies of the reports of Dr Stevenson.

7 The plaintiff’s solicitors then wrote to the trustee again, the trustee wrote to the insurer, and the insurer confirmed its denial of a claim. Then, on 1 February 2001, the insurer advised that it would now permit the plaintiff’s solicitors to view a copy of the tape at the office of the trustee and the trustee invited the plaintiff’s solicitors to make an appointment to do this. The plaintiff’s solicitors (perhaps in the one letter) asked the trustee to make an immediate decision on the plaintiff’s claim, and asked that the insurer consent, not just to the plaintiff viewing the tape, but to a copy being provided to each of Drs Richards, Champion and Wakefield. The insurer responded by agreeing that the plaintiff, her solicitors and the doctors might view the tape in the office of the trustee, but not agreeing to the release of a copy of the tape.

8 Later, the plaintiff’s solicitors called for an immediate decision by the trustee, and the trustee then denied the claim. Later still, the insurer agreed to provide a copy of the tape to the plaintiff’s solicitors, and it did so in December 2002. The plaintiff did not thereafter ask the trustee to reconsider the denial of the liability until after the present action had been commenced.

9 One strand of the plaintiff’s case on this motion is that, whilst the trustee from time to time relied upon the surveillance tape, in that the insurer had relied upon it, the insurer failed to provide a copy of it to the plaintiff or to her solicitors, so as to reasonably enable the plaintiff to show it to the various medical practitioners. The argument stressed the obligation of good faith owed by the insurer, not only to the former trustee, but also to the plaintiff, and to what was said to be the unreasonableness of the proposition advanced in July 2001 that the plaintiff and her advisers, including various medical practitioners, should all be assembled at once to view the tape.

10 I do not hold that there was bad faith involved, or that the trustees breached any relevant duty to the plaintiff, but I do hold that it would not be right, in these circumstances, either to dismiss the action under part 13 rule 5, or to strike out the whole or any part of the plaintiff’s pleading, under part 15 rule 26.

11 Part 13 rule 5 does not authorise the dismissal of a proceeding unless the whole of the claim made should be dismissed. That is, if one part of it is possibly sustainable then, according to the ordinary procedure of the courts, the action should go to a final hearing, and not be summarily dismissed. Part 15 rule 26 does not provide to the contrary in any sense that is presently relevant. Paragraph 19 of the statement of claim pleads a breach of duty as trustee, and gives many particulars. If, as I find to be the case, some of these particulars assert the existence of a case that is not to be summarily dismissed, then it would not be right to strike out the pleading. The rule authorises the striking out of pleadings, and not of particulars.

12 The defendant foreshadowed the possibility that the insurer might be joined as a party. In the circumstances, I dismiss so much of the motion as seeks to dismiss the action, or to strike out the statement of claim, and I will adjourn the case to some date, to be listed for directions before the registrar. I reserve the question of costs for the trial judge. In case it will be of assistance to that judge, I record that the defendant succeeded on the motion to the extent that it caused the plaintiff to file a statement of claim, but that the plaintiff succeeded to the extent that the motion was argued. The hearing of the case, which had been fixed for 1 December 2004, was vacated to enable the motion to be argued on that day.

I certify that paragraphs 1 -12
are a true copy of the reasons
for judgment herein of
the Hon. Acting Justice Brownie
given on 8 December 2004

___________________
Susan Piggott
Associate
8 December 2004

Last Modified: 12/15/2004