Panos v FSS Trustee Corporation - [2015] NSWSC 1217

Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: Panos v FSS Trustee Corporation [2015] NSWSC 1217
Hearing dates: 9, 10 and 11 February 2015
Date of orders: 27 August 2015
Decision date: 27 August 2015
Jurisdiction: Equity
Before: Robb J
Decision:
(1)   The plaintiff’s claim is dismissed.

(2)   The parties are given leave to make submissions on all questions of costs, particularly as to the first defendant’s costs, and the costs thrown away as a result of the vacation of the first hearing.
(3)   Exhibits and documents produced on subpoena may be returned immediately in accordance with the rules.
Catchwords: INSURANCE – accident and sickness insurance – superannuation trustee holding insurance policy covering total and permanent disablement of scheme members including the plaintiff – challenging decision of the insurer – whether plaintiff totally and permanently disabled within the meaning of the relevant superannuation trust deed and insurance policy – assessment of varied opinions in multiple expert medical reports as to significance of plaintiff’s disabilities – Court finds that plaintiff overstated his disabilities – whether plaintiff likely to gain employment in roles the plaintiff is qualified in – Court finds that plaintiff is likely to be able to undertake various jobs reasonably within his original education, training and experience – plaintiff failed to establish his entitlement to TPD benefit – plaintiff’s claim dismissed
Legislation Cited: Evidence Act 1995 (NSW)
Superannuation Industry (Supervision) Act 1993 (Cth)
Superannuation (Resolution of Complaints) Act 1993 (Cth)
Cases Cited: Allstate Life Insurance Co v ANZ Banking Group Ltd (No 5) (1996) 64 FCR 73
Beverley v Tyndall Life Insurance Co Ltd [1999] WASCA 198
Birdsall v Motor Trades Association of Australia Superannuation Fund Pty Limited [2015] NSWCA 104
Borg v Ramsay Health Care trading as North Shore Private Hospital Pty Ltd [2014] NSWSC 37
Chammas v Harwood Nominees Pty Ltd (1993) 7 ANZ Ins Cas 61–175
Hannover Life Re of Australasia Ltd v Dargan [2013] NSWCA 57; (2013) 83 NSWLR 246
Hannover Life Re of Australasia Ltd v Sayseng [2005] NSWCA 214; 13 ANZ Ins Cas 90-123
Hughes Aircraft Systems International v Airservices Australia (No 3) (1997) 80 FCR 276
Papamanos v Commonwealth Bank of Australia [2014] VSCA 167
Shuetrim v FSS Trustee Corporation [2015] NSWSC 464
Wyllie v National Mutual Life Association of Australasia (1997) 217 ALR 324
Category: Principal judgment
Parties: Peter Panos (plaintiff)
FSS Trustee Corporation (first defendant)
Metlife Insurance (second defendant)
Representation:
Counsel: M J Bleasel (plaintiff)
S J Walsh (second defendant)
Solicitors: Firths Compensation Lawyers (plaintiff)
Mills Oakley (first defendant)
Turks Legal (second defendant)

File Number(s): 2013/121809
Publication restriction: None

Judgment

Introduction

The primary issue in these proceedings is whether Mr Peter Panos, the plaintiff, is entitled to an order that the second defendant, MetLife Insurance Ltd (the “Insurer”), pay to the first defendant, FSS Trustee Corporation (the “Trustee”), the amount of a benefit for total and permanent disability (“TPD”) to which Mr Panos claims to be entitled, under an insurance policy (the “Policy”) issued by the Insurer to the Trustee, in respect of the First State Superannuation Scheme (the “Fund”), of which Mr Panos was a member and the Trustee was trustee.
Mr Panos has pursued his claim directly against the Insurer. He has made a number of claims for relief against the Trustee, but the Trustee has filed a submitting appearance, save as to costs. It appears to be accepted by the parties that, if the court makes the order sought by Mr Panos, and the amount of the benefit is paid by the Insurer to the Trustee, the Trustee will in due course pay that amount to Mr Panos.
The parties have agreed that the amount of the TPD benefit that is payable, if Mr Panos succeeds, is $140,700.
In the circumstances that will be recounted in more detail below, Mr Panos claims that he suffered injuries and disabilities that caused him to be totally and permanently disabled within the meaning of the deed that constituted the Fund, and the Policy. He made a claim on the Trustee, which in turn made a claim on the Insurer, as the Trustee had insured its obligation to pay benefits to members of the Fund, and the amount of the benefit that the Trustee is actually required to pay to a member is limited to the amount recoverable by the Trustee under the Policy. The Insurer eventually denied that it was liable to pay the TPD benefit that Mr Panos claimed. The circumstances in which the denial occurred were complicated, and will be considered more fully below.
There was no issue between the parties concerning Mr Panos’ being a member of the Fund, or the Trustee’s having insured its liability to pay a TPD benefit to members of the Fund under the Policy issued by the Insurer.
It will be convenient to begin by identifying the relevant provisions of the trust deed that governs the operation of the Fund, and the terms of the Policy.

The Fund

The trust deed and the annexed rules that are in evidence appear to incorporate amendments to the rules made up to 29 June 2011. They are undated and unexecuted. The parties accepted that the document has governed the operation of the Fund at relevant times. The rules, which contain the provisions relevant to the present dispute, comprise annexure A to the trust deed.
The Fund is a regulated superannuation fund under the Superannuation Industry (Supervision) Act 1993 (Cth): r 2.2.
Rule 11.1 authorises the Trustee to acquire insurance policies to provide insured benefits for members. “Insured benefit” is defined in r 23.1 to mean “in respect of a member, the amount payable to the Trustee from an insurance policy in respect of the death or disability of that member”.
Under r 11.2:

The insured benefit of a member is:
(a) limited to the extent that the Trustee is able to affect cover under an insurance policy;
(b) only payable to the extent that the Trustee receives payment from the insurer under an insurance policy.

Rule 5.2, in Section 2, Division 2C, provides that, if the Trustee becomes entitled to a total disability benefit under any policy of insurance effected in respect of a member, the Trustee will pay a benefit from the Fund in accordance with the terms of that policy (subject to a qualification not presently relevant).
In the same section and division of the rules, r 10 contains a definition of “disability” in two parts. The first part is: “(a) the same meaning as that term has for the time being and from time to time in any applicable policy of insurance”. The second part of the definition applies: “(b) in any other case…” and so does not appear to be relevant to the present dispute. “Total disability” is defined as having: “the same meaning as that term (or any equivalent term in the opinion of the Trustee) has for the time being and from time to time in any applicable policy of insurance”.
In the present case, there does not appear to be any material difference between Mr Panos’ entitlement to receive a TPD benefit from the Fund, and the Trustee’s right to receive an equivalent benefit under the Policy. Furthermore, the parties did not identify any terms of the rules that affect the amount that the Trustee is required to pay to Mr Panos, if it receives payment of a TPD benefit from the Insurer in respect of his claim. If there are such terms, then the parties have effectively left their application to be dealt with after judgment in this case as between the relevant parties.

The Policy

The Policy wording in the definition section contains a definition of “Totally and Permanently Disablement/Disabled (TPD)”, which materially provides:

(a) When a Covered Person is Employed… for at least the Minimum Hours, if one of the following (i) to (iv) applies:…
(ii) the Covered Person having been absent from their Occupation through Injury or Illness for 6 consecutive months and having provided proof to the satisfaction of us that the Covered Person has become incapacitated to such an extent as to render the Covered Person unlikely ever to engage in or work for reward in any occupation or work for which he or she is reasonably qualified by reason of education, training or experience”.

No party suggested that Mr Panos did not satisfy the criteria required for any of the defined terms in this definition, so the question is whether it was, in fact, satisfied.
The ordinary meaning of the wording used would suggest that the Trustee was required to provide proof to the Insurer that Mr Panos had become incapacitated to the relevant extent as at the end of the period of 6 consecutive months’ absence from employment.
“Illness” is defined as meaning “sickness disease or disorder”, and “Injury” is defined as meaning “bodily injury which is caused solely and directly by external, violent and accidental means and is independent of any other cause”. It was not suggested by the Insurer that the disabilities from which Mr Panos suffers fall outside one or other of these two definitions.
“Total and Permanent Disablement Benefit” is defined as meaning the benefit payable under cl7. Under that clause:

When a Covered Person…is eligible for Total and Permanent Disablement… subject to the provisions of this Policy and our agreement to the eligibility for a Benefit, we will pay to the Policyowner the Insured Cover in respect of that Covered Person as soon as practical after our required claims procedures and documentation requirements have been satisfied.

The “Insured Cover” is stated in the first schedule. The amount is not in issue in these proceedings.
The requirement that the Insurer pay a benefit to the Trustee is therefore subject to the Insurer making two determinations. For there to be a TPD circumstance, proof of incapacitation to the relevant extent must be provided to the satisfaction of the Insurer, for the purpose of the definition of TPD. Secondly, the obligation to pay the benefit under cl 7 arises if the Insurer agrees that the Trustee is eligible to receive the benefit. The latter determination by the Insurer may introduce the application of any number of terms of the Policy, other than satisfaction of the definition of TPD, that must be established before a benefit is payable. In the present case, the only determination by the Insurer that is relevant is the one that is required by the definition of TPD.

The pleadings and the history of the proceedings

In order to understand the evolution in the issues that has occurred over the life of these proceedings, as well as the issues that were finally before the court for determination, it will be necessary to analyse the course of events and the pleadings in some detail.
The need for the court to carry out this exercise is unfortunate. In part, the cause was beyond the control of Mr Panos, because, as will be seen, the conduct of the Insurer has led to the vacation of the first hearing in this matter, and required Mr Panos to completely reformulate his claim. However, Mr Panos' pleadings are in a number of respects deficient, in that they fail to make positive and clear allegations concerning a number of crucial aspects of his case. Parts of Mr Panos' case depend upon implications from the pleadings. Furthermore, the particulars given by Mr Panos have been formulated in such general terms that they do not with sufficient precision define the case that Mr Panos is seeking to make. This has led to a difference between the parties concerning Mr Panos' entitlement to make the case that he put in final submissions.

Mr Panos' claim

Mr Panos lodged a claim for TPD benefits with the Trustee on 21 March 2012, by means of his solicitors’ letter of that date. The letter was accompanied by 27 documents to support Mr Panos’ claim, including a document described as “MetLife Statement of Claim” (the “Claim”). This is a pro forma document prepared in blank, which has been completed by hand by Mr Panos or someone on his behalf. It is necessary to start with the Claim, because Mr Panos puts alternative cases concerning the date upon which Mr Panos had been absent from his occupation through injury for 6 consecutive months, for the purposes of cl (a)(ii) of the definition of TPD in the Policy. The identification of the relevant date may be found in the Claim. Relevantly, the Claim identified the date of the disability as 18 March 2010 and the date last worked as 26 May 2011. Mr Panos described his injury as: “Injury to lower back, neck, left shoulder, teeth (had 4 chipped teeth) motor vehicle accident on way to work. Depression, insomnia”.

Mr Panos' statement of claim

Mr Panos filed a statement of claim on 19 April 2013. Materially, in the statement of the relief claimed, Mr Panos claimed a declaration that the Trustee and the Insurer had constructively denied his claim for TPD benefits (par 4), a declaration that he was totally and permanently disabled (par 5) and an order that the Insurer pay to the Trustee in trust for Mr Panos the defined benefit of $149,100 together with interest.
In the allegations of fact pleaded by Mr Panos, he alleged the factual circumstances that he said gave rise to his entitlement to the TPD benefit in pars 1 to 22, and then alleged in par 23 that he lodged his claim for the TPD benefit with the Trustee on or about 21 March 2012. He alleged in par 24: “To date the Defendants have refused to make a decision on the Plaintiff’s claim”. He then alleged in par 25 that he had elected to treat the defendants’ refusal to make a decision as constructive denial of his claim. Having done that, in pars 27 to 35, Mr Panos alleged breaches by the Trustee of various general law and statutory duties. The only further allegation that Mr Panos made against the Insurer was that the Insurer had acted in breach of its statutory and general law duties in refusing to accept Mr Panos’ claim for TPD benefits (par 36), for the reasons given in the particulars in par 37, by reason of which Mr Panos had suffered loss (par 38).
Relevantly, the claim made by Mr Panos in his statement of claim was primarily one of constructive denial by both defendants of his claim for a TPD benefit.
Mr Panos did not positively plead in his statement of claim that he was absent from his occupation through injury for 6 consecutive months from an identified time, unless the allegation be found in pars 17, 18, 21 and 22 of the statement of claim. He alleged in par 17 that he suffered certain injuries on 26 May 2011, and in par 18 that, after that accident, Mr Panos was not able to return to his job and has not carried out regular employment since 26 May 2011. That could be intended to identify 26 May 2011 as the commencement of the absence from Mr Panos' occupation. That reading of the pleading is supported by noting that Mr Panos alleged in par 21 that he worked in a nursing home between October 2012 and 19 January 2013, but in par 22 he claimed that the work carried out in the nursing home was not regular, consistent or sustainable work and was in fact a failed rehabilitation attempt.
To avoid unnecessary confusion, I note that in the claim, Mr Panos referred to 18 March 2010 as being the date he suffered his disability (which was the date Mr Panos was involved in his first motor vehicle accident) but in his statement of claim he alleged that he suffered injuries on 26 May 2011 (which was the date he was involved in a second motor vehicle accident).
It may have been thought reasonably obvious that Mr Panos alleged that the period of absence from his occupation commenced on 26 May 2011 were it not for the fact that, in his written submissions, he put an alternative case that the period commenced on 19 January 2013.
The Insurer responded to these alternative submissions by submitting that the only relevant date was 26 May 2011.

The Trustee's and the Insurer's defences

The Trustee filed a defence on 18 July 2013, and the Insurer filed a defence on 29 August 2013, followed by an amended defence on 12 September 2013. Relevantly, the Insurer claimed in par 16 that it received notice of Mr Panos’ claim on about 12 September 2012. In par 17, it denied the allegation that it had refused to make a decision on Mr Panos’ claim, and said that the proceedings had been commenced prematurely, before the Insurer had received all information required in order to assess Mr Panos’ claim, and before the Insurer had been provided with a reasonable opportunity to form an opinion as to whether Mr Panos met the definition of TPD set out in the Policy.

Mr Panos' amended statement of claim

Mr Panos filed an amended statement of claim on 5 March 2014. He amended par 4 of his original claim for relief to delete the reference to the Trustee, and effectively limited his claim in that regard to a declaration that the Insurer had constructively denied his claim. Mr Panos made corresponding amendments to the allegations of fact that he pleaded, and he deleted all of the allegations that supported a claim of breach of duty by the Trustee.
The parties to the proceedings must therefore be satisfied that Mr Panos is entitled to prosecute his claim directly against the Insurer, and that in due course an appropriate order will be made, if Mr Panos' case succeeds, against the Insurer in favour of the Trustee, and that appropriate steps will be taken by the Trustee to pay to Mr Panos the amount that he is due from the Fund. The parties did not seek to raise, or deal with, any of the matters raised by Basten JA in Birdsall v Motor Trades Association of Australia Superannuation Fund Pty Limited [2015] NSWCA 104 concerning attacks by members of funds, such as the Fund, against decisions taken by trustees.

Fixing of the proceedings for hearing

On 6 September 2013, the Registrar fixed Mr Panos’ claim for hearing for three days commencing on 11 March 2014.

Submission by the Trustee

On 5 March 2014, the Trustee filed an appearance in which it submitted, save as to costs. Evidently, the Trustee took that course because Mr Panos no longer sought any relief against the Trustee that was against its interests. However, it remained joined to the proceedings only for the purpose of allowing Mr Panos to seek relief against the Insurer, which in part would require the Insurer to pay to the Trustee the TPD benefit to which Mr Panos claimed to be entitled.
Whatever the outcome of Mr Panos' claim, it will be necessary for the court to give the Trustee and the other parties an opportunity to make submissions concerning the order that should be made in relation to the Trustee's costs.

The Insurer's 'procedural fairness' letter

On 5 March 2014, the Insurer wrote a letter to Mr Panos’ solicitor. Relevantly, the letter stated:

We refer to the above TPD claim and previous correspondence.
As you may be aware, we have sought access to material produced under subpoena in Supreme Court proceedings 2013/121809 for the purpose of our assessment of the claim. In our view, the information produced under subpoena is likely to be highly relevant to the consideration of whether or not you qualify for payment of a TPD benefit.
We regret that you have refused your consent (via your solicitor) to allow us to have access to the material for the purpose of our assessment of the claim. Accordingly, we are moving towards a determination of your claim based on the material we hold.
As part of that process, and in the interests of procedural fairness in accordance with Sayseng v Kellogg Superannuation Pty Ltd [2003] NSWSC 945, we hereby provide notice of all the evidence we have obtained in the assessment of the TPD claim and invite you to make any further submissions which you consider necessary. You should also provide us with any additional evidence that you would like us to consider in forming our opinion regarding the TPD claim.

We advise that your claim for a TPD benefit will be assessed under the following definition: [definition set out]
The material we will consider in making our determination with respect to your claim includes the material you have forwarded to your superannuation trustee (FTC Trustee Corporation) as well as the material we have obtained as listed in the following list of documents. We particularly draw your attention to the material in this list which may be adverse to your claim: [127 documents listed]
We draw your attention to those documents marked with an asterisk; which we note were provided to your solicitor on 13 September 2013. Accordingly, we trust that you and/or your solicitors already hold copies of these documents and as such we have not enclosed further copies.
Along with any written submissions, we invite you to submit any additional medical information, including medical records, or other evidence that you believe will assist in the assessment of your claim for total and permanent disability benefit. Please note that your duty of good faith and fair dealing requires you to provide us with information that supports your claim and material which is adverse to your claim [footnote reference to Mabbett v Watson Wyatt Superannuation& Anor [2008] NSWSC 365].
As almost all of this material has been in the possession of your solicitor since 13 September 2013, we request that you provide us with any response and any further documents by 5pm on 7 March 2014.
Our decision on your claim will be based on the material you have sent to us, the material in the list of documents, and any submissions or further documents you provided in response to this letter which we received by 5pm on 7 March 2014.
We look forward to hearing from you…

An asterisk was placed beside all of the documents listed except the last three, which were described as AHC Investigation report dated 4 September 2013, report of Dr Kana dated 16 January 2014 and letter of instructions dated 25 November 2013, and affidavit of Peter Panos dated 22 January 2014.

Vacation of hearing

When the proceedings came on for hearing before McDougall J on 11 March 2014, his Honour was informed that the Insurer had informed Mr Panos shortly before the hearing that it had made a decision on his TPD benefit claim, and decided to reject it. The Insurer proposed to deliver a letter that day setting out both its decision and the reasons why it had reached the decision. As McDougall J noted in the ex tempore judgment he delivered, the effect of the Insurer’s notification was that the nature of the issues that the Court was required to deal had changed. Previously, the issue had been whether there was a constructive denial of the claim, and if so whether Mr Panos had established on the evidence that he was entitled to the TPD benefit. Once the Insurer had denied the claim, the grounds upon which Mr Panos could obtain relief became more limited. Additionally, the Trustee might become re-involved in the matter. Relevantly, McDougall J vacated the hearing, and made consequential orders.
I note that by order 3, his Honour reserved to the judge ultimately hearing the case the question of how and on what basis the costs thrown away by reason of the vacation of the hearing date should be paid. The parties have not made submissions to me on this issue. In due course, whatever may be the outcome of this dispute, it will be necessary for me to give the parties an opportunity to make submissions on this costs issue.

The first declinature dated 17 March 2014

On 17 March 2014, the Insurer delivered a letter to Mr Panos in which it advised that it had declined his claim for the TPD benefit, and gave its reasons for that denial. It will be necessary to examine those reasons in some detail in due course. For the purposes of the proceedings the parties referred to this letter as “the first declinature”.
It will be necessary to set out the first declinature:

We refer to the above and the member’s claim for payment of a benefit for Total and Permanent Disablement.
Procedural fairness was conducted by way of MetLife’s correspondence of 5 March 2014 which was forwarded to the fund and to the member’s solicitor.
After consideration and assessment of all evidence on file, we wish to advise that the claim for payment of a benefit for Total and Permanent Disablement with respect to the member is declined.
MetLife’s reasons for this decision are outlined below.
MetLife received the claim from FTC on 13 September 2014. Included with the initial claim documents, was the claimant’s claim form (‘Statement of claim’) that is signed and dated 13 January 2012. Within the body of that document the claimant advised that he had ceased work on 26 May 2011 due to injuries to his back, neck, shoulder, teeth, depression and insomnia. Reference was also made to a motor vehicle accident the member was involved in on his way to work.
In the assessment of the claim, evidence was elicited from, but not limited to, the claimant’s treating health professionals, insurers with whom the claimant had made other claims, independent medical specialists and investigations commenced at the instruction of MetLife.
BACKGROUND
The member is a 43-year-old former Assistant in Nursing. He commenced employment with South Eastern Sydney Illawarra Area Health Service (SESIAHS) on 21 August 2006 and became a member of the fund on 19 November 2007.
The member sustained a number of injuries during the period 19 November 2007 to 30 November 2010, including:
•   A back injury sustained while lifting a box of IV fluids on 25 January 2010;
•   Injuries as a result of a motor vehicle accident on 18 March 2010.
During the course of 2010 the member had periods of time off work as a result of his injuries as well as returning to work on pre-injury or suitable duties.
After being certified by his GP, Dr Kana, as fit to return to pre-injury duties on 20 December 2010, the member was involved in a motor vehicle accident on 24 December 2012, resulting in further time away from work to recover. However, he was certified fit to perform suitable duties on 10 January 2011.
The member claims to have sustained further injuries after tripping over a wheelchair on 20 May 2011 and being involved in a further motor vehicle accident on 26 May 2011. He also underwent an operation to his left shoulder on 2 September 2011.
The plaintiff’s employment with SESIAHS was terminated on 15 December 2011 as no suitable duties were available to the member given his reported restrictions. Furthermore, due to a driving restriction, the member claimed to be incapable of driving to work from his home in Fairy Meadow to his place of work at The Sutherland Hospital in Caringbah.
Dr Kana continued to certify the member fit for suitable duties and, on 7 February 2012, fit for pre-injury duties. However, the member claimed to have reinjured his shoulder while putting his bins out on 22 February 2012 and, as a result, Dr Kana downgraded his certificate to fit for suitable duties.
The member commenced a 6 week returned to work trial in September 2012 as an assistant in nursing at the Hillside Figtree Nursing Home. After successfully completing the return to work trial, the member gained a casual position with Hillside Figtree where he continued working until he sustained a further injury to his shoulder and back on 30 May 2013 while assisting a patient.
The member’s employment with Hillside Figtree ceased on 7 June 2013.
[Definition of TPD inserted, plus a term of the Policy that is no longer relevant]
OUR DECISION
[Reason for declining claim that the Insurer has abandoned]
Is the Member Totally and Permanently Disabled?
In relation to the question of whether the member meets the requirements in the TPD definition, we make the following comments:
Education, Training and Experience
In order to satisfy the TPD definition we require proof to our satisfaction that the member has become incapacitated to such an extent as to render him unlikely ever to engage in work for reward in any occupation or work for which he is reasonably qualified by his education, training and experience.
We note that the member left school mid-way through year 9 at the age of 17. He subsequently obtained work in a range of occupations, including as a process worker, as a security guard at the Reef Casino in Cairns, as a storeman for Woolworths as a bar worker and supervisor at the Hellenic club in addition to his experience as an assistant in nursing.
In terms of vocational training, the member holds an Assistant in Nursing certificate, Certificate III in Aged Care Work which he obtained in 2007 and an OH&S certificate which he obtained in 2003. He completed a ‘Concepts in Palliative Care’ course in 2006 and also holds a forklift license, a crane licence and qualifications in the responsible service of alcohol and responsible conduct of gambling.
We note that the member is currently 43 years of age with an approximate working life expectancy of 24 years.
Dr McBurnie
As you are aware, Dr McBurnie, who is an occupation physician, reviewed the medical evidence with which we have been provided and reported on 31 December 2012 that she considered that the member was fit for full hours in his pre-injury role as an assistant in nursing. She noted that the member had an underlying degenerative condition affecting his cervical and lumbar spine and the condition affecting his left shoulder. She agreed with Dr Kana that he had a permanent lifting restriction of 20 kg, however, in her opinion this restriction did not prevent him from undertaking a variety of duties as an assistant in nursing.
Overall Dr McBurnie considered the member was fit to perform as an assistant in nursing at an aged care facility and to undertake a variety of office-based work and that the member had the necessary level of qualifications and experience to undertake such work in a full-time capacity.
Dr Kana
As noted above, Dr Kana completed a medical statement on 3 February 2011 which the member lodged in support of his claim. However, it is our view that Dr Kana’s medical statement does not support the member as being totally and permanently disabled. In particular, we note that Dr Kana states that the member has been working on a partial or restricted basis since October 2010. Furthermore, in response to the question “when was the patient able to return on a full-time basis?” Dr Kana only responded “not yet”.
Our view that Dr Kana does not support the member being totally and permanently disabled is also supported by Kana’s WorkCover medical certificates in which he certified the member fit to perform suitable duties at full hours on 7 March 2012, 10 April 2012, 4 May 2012, 31 May 2012, 7 June 2012, 22 June 2012, 4 August 2012 and 10 September 2012. The only restriction Dr Kana imposed was lifting more than 20-25 kgs (which Dr McBurnie did not consider was a requirement of his pre-injury work) and a driving restriction of up to 30-40 minutes.
We asked Dr Kana to comment on the vocational options identified by Ms Petersen and Ms Paterson in their vocational and functional assessment report (discussed below). Although presented with all of the roles identified by Ms Petersen and Mrs Paterson, Dr Kana only discounted the occupations of assistant in nursing and Security Officer in his report dated 16 January 2014. He was silent as to the balance of the roles. Dr Kana also noted that the plaintiff was restricted from performing lifting or “work” until a further MRI had been performed on his lower back. Unfortunately Dr Kana did not elaborate on what he intended by using the word “work”.
Dr Giblin
We acknowledge receipt of Dr Giblin’s report stated 7 May 2012 and 15 October 2012.
In his report dated 7 May 2012, Dr Giblin noted the member had full range of motion in his right shoulder and some restriction in his left shoulder which Dr Giblin considered amounted to 8% whole person impairment. He also described the member as being strongly built with well-formed muscles and calluses on his hands. In his October 2012 report, Dr Giblin described the member as being overweight, unfit and undereducated. On account of these characteristics and the member’s radiological findings, Dr Giblin considered that the member would never return to work within his education, training or experience.
Dr Giblin’s comments are noted, but are considered in light of Dr McBurnie’s comments in her report of December 2012 where she found the member to have well developed musculature which indicated regular gym attendance and persistent training and his recent weight loss. It is also noted that by this stage, the member was in fact working as an assistant in nursing with Hillside Figtree and Dr McBurnie considered that not only was he fit to perform his role, but he was also capable of performing office-based duties within his education, training and experience.
We are aware that the member has served further reports of Dr Giblin in the proceedings, however, he did so after consent was requested for access to subpoenaed documents for the purposes of determining the claim which you refuse to provide. It is not apparent to us whether service of the further Dr Giblin report was solely for the purposes of the proceedings or whether the member intended those reports also to be considered by us in reaching our decision in relation to the claim. If you or the member wish for us to review our decision in light of the further reports or any other information, please let us know and we will conduct a review.
Work at Hillside Figtree
We note that the member in fact completed a return to work trial at Hillside Figtree in September 2012. Once that work trial had been successfully completed, the member was offered a casual position from 2 October 2012. We also note that during the period he was working for Hillside Figtree as an assistant in nursing, he undertook and completed a security course at Granville between February and May 2013. We note that the member’s employment with Hillside Figtree was terminated at the member’s request on 7 June 2013.
Dr Diwan
In his report dated 16 June 2010, Dr Diwan noted that radiology reports did not show any evidence of neural compression at any level. He considered in his report of 6 October 2010 that the member was unable to cope with his work at Sutherland Hospital due to the long distance he had to travel to work and repeated twisting and turning. However, he considered that the member was likely to have a good outcome if he changed his workplace or his role. We note that Dr Diwan discharged the member from his surgical care and referred the member for motor relearning with Dr Ho at Special Spinal Rehab.
We understand that Dr Diwan has provided a further report dated 17 February 2011 in evidence in the proceedings, however, we have regrettably not been able to consider that report as the member has refused to consent to us having access to it for the purposes of our assessment.
Right Knee Injury
The reports of Drs Patrick, Nagamori, Gray and Machart addressed the question of the member’s right knee injury in 2004. We note there is evidence of an underlying degenerative condition, however, we also note the following:
•   The member makes no mention of any knee condition in the claim documents provided to us. We refer to the claim forms dated 13 January 2012 and accompanying medical statement of Dr Kana dated 3 February 2011 dated 3 February 2011; and
•   The knee condition did not prevent the member from obtaining work as an AIN with the SESIAHS in 2006 or at the Hillside Figtree Nursing Home in 2012.
Dr Kana has not included any restriction with respect to the right knee in medical certificates issued by him during the period 30 November 2010 onwards in the medical certificates provided to us.
Psychological
We note that in the Statement of Claim the member refers to depression. On the evidence available to us, however, it does not appear that any depressive condition from which the member suffers has prevented him or is likely in the future to prevent him from engaging in work for which he is qualified by reason of his education, training or experience.
We have reviewed the report of Mr O’Brien, a psychologist to whom the member was referred for pain management from 30 June 2010. We note that in his report dated 30 June 2010 Mr O’Brien stated that the member had initially presented in a visibly distressed state as a result of the lack of sleep, pain and difficulties he was having in the workplace. We note that the member was said to have suicidal ideation. However, we also note that at the second session the member was reported to be calmer and at the member had been rehabilitated from his pain condition. We note that Mr O’Brien considered the member had symptoms consistent with a Major Depressive Disorder and that he had developed unhelpful coping strategies such as drinking excessive amounts of alcohol. Mr O’Brien recommended 5 more sessions of psychological therapy to provide pain management counselling, structured problem-solving strategies, psychological education, cognitive behavioural therapy, self-care and relaxation training and relapse prevention training.
We have been provided with an email from Bill Ada to whom the member was referred by the worker’s compensation rehabilitation provider, dated 30 November 2010. In that email Mr Ada reports that the member presented with symptoms commensurate with Adjustment Disorder with Mixed Anxiety and Depressed Mood in the severe to extremely severe range and that the member was reported to have difficulty coping with stress, particularly in relation to pain symptoms and management of his injuries. We note that Mr Ada encouraged the member to return to work and that he did so on 3 November 2010 for four hours per day, two days per week with restrictions. We note that this was reported to help increase the member’s self-esteem, although he expressed reluctance to increase his working hours due to increased pain symptoms and travel.
That said, we note that at the member’s last review with Mr Ada on 18 November 2010, he had shown marked improvement from treatment, he reported a reduction in his levels of anxiety and improved anger management. We note that he continued to report some distress, however, this was said to be due to the number of treatment sessions he was having and childcare commitments whilst working. We further note that the member contacted Injury Treatment on 24 October 2010 to advise that he no longer wished to receive rehabilitation or treatment services from that company and that Mr Ada had attempted to contact the member on two occasions to discuss and resolve the member’s concerns, but that the member had not replied.
The member has not provided any further or updated reports from Mr O’Brien. However we note that following Mr O’Brien’s assessment in June 2010 the member in fact returned to work at his pre-injury employment from November 2010 and subsequently obtained casual employment with Hillside Figtree Nursing Home. There is no reference in the member’s statements or affidavits with which we have been provided to the member having treatment for depression since 2010.
Dr Haber
We have been provided with a report of Dr Haber dated 18 January 2011 in relation to the member’s left shoulder injury. Dr Haber had diagnosed subacromial bursitis and tendinitis with no rotator cuff tear. He considered there to be no diagnostic signs of impingement. He made a provisional diagnosis of pain arising from a possible whiplash injury and possible impingement of the rotator cuff. We understand that Dr Haber has provided other reports which have been provided to the Court, however, we regret we are unable to consider these as the member has not provided consent.
John Zaharis
We note that Dr McBurnie’s opinion is consistent with the previous vocational assessment report provided by John Zaharis of Injury Treatment in January 2012. He assumed that the member was subject to a greater lifting restriction than that subsequently identified by Dr Kana in that he assumed the member’s lifting restriction was 10 kg. He nevertheless considered that the occupations of age/disabled carer, bar attendants, gaming worker and Security Officer were suitable.

Ms Peterson and Ms Paterson
We have also had regard to the vocational assessment and functional capacity report prepared by Ms Peterson and Ms Paterson of Rehab Management Pty Ltd dated 16 October 2013. In that report the member was identified to have various transferable skills which are suited to the roles of process worker, security worker, bar attendant, assistant in nursing and aged care assistant, as well as other general communication, administrative, computer, organisational and other skills.
We note that on functional capacity assessment, there were inconsistencies in the member’s presentation. In particular, normal variation in grip strength was not observed from which the authors concluded the member was not performing to maximal effort. The member also ceased activities reporting a fear of aggravating pain symptoms. For example walking 100 metres, being unable to perform a semi squat and being able (sic) to carry more than 3.75 kilograms a distance of 20 metres. The degree of restriction reported is inconsistent with the level of restriction placed on the member by his own GP.
Ms Peterson and Ms Paterson considered that there were a range of occupations for which the member was qualified by reason of his education, training and experience, namely, security officer, call centre operator, enquiry clerk, gaming worker, doorperson, infantry and supply officer, bar attendant and product assembler and that positions in those occupations are available in the Sydney area. Whilst we note Dr Kana considers the member has a driving restriction of up to 30 minutes, that does not in our view preclude the member from obtaining work in those industries. As mentioned above, when asked to comment on the vocational report, the only roles that Dr Kana stated were unsuitable for the member were assistant in nursing and security officer.
The Member’s Statements and Affidavits
We have considered the member’s statement dated 10 July 2012 and 31 January 2013, and affidavit dated 22 January 2014. We particularly note his comments that he considers he would be unable to support a patient if a patient lost balance, that he would not be able to respond to an emergency situation or lift or shift the patient and that he considers his communication skills to be average and that he does not have any clerical or administrative or organisational skills.
We have balanced the member’s statements against the evidence and information provided to us, in particular the fact that he was able to work as an assistant in nursing at Hillside Figtree for approximately 9 months from September 2012, he was able to complete a security course and obtain a security licence in 2013, the fact that he appears to have maintained a good muscle bulk despite his alleged restrictions and symptoms, as noted in numerous medical reports and the opinions of the member’s treating medical consultants and independent medical examiner Dr McBurnie and Ms Peterson and Ms Paterson.
Taking the available evidence into account, we are not satisfied the member has become incapacitated to such an extent as to render him unlikely ever to engage in work for reward in any occupation or work for which he is reasonably qualified by reason of his education, training or experience.

It is significant that, in the section of the first declinature dealing with Dr Giblin’s reports, the Insurer said: If you or the member wish for us to review our decision in the light of the further reports or any other information, please let us know and we will conduct a review”.
The court’s record of proceedings shows that, on 6 May 2014, when the parties were before a registrar, the court was informed that the Trustee wanted a review of the declinature, and an order was made that Mr Panos and the Trustee request the review by 20 May 2014.

Trustee's request to Insurer for reconsideration of Mr Panos' claim

On 21 May 2014, the Trustee’s solicitors wrote a letter to the Insurer in which they requested the Insurer to review its decision as advised in the first declinature, and to reconsider the claim on further evidence.
It will be necessary to analyse the Trustee's letter in some detail, as Mr Panos relies upon the arguments put in that letter for the purposes of identifying the issues in his case.
The Trustee referred to the fact that these proceedings were currently being litigated, and that the Trustee had been directed to notify the Insurer of any request for internal review of its decision.
The Trustee requested the Insurer to review its initial decision, and also to reconsider the claim on further evidence.
The letter does not give any specific basis for this request, in the sense of referring to a provision in the Policy which entitled the Trustee to an internal review. Clause 18 of the Policy permitted the Trustee to refer a disputed claim to what was called the “Claims Review Committee”, which was to be constituted by a representative of the Trustee, the Insurer, and an independent person. It is not known why the Trustee did not follow that approach in the present case. It may be that the Trustee relied upon the invitation in the first declinature that the Insurer made for the Trustee to request a review and submit further evidence, but even that is not known.
The Trustee's letter first dealt with a ground relied upon by the Insurer to deny Mr Panos' claim, which asserted that he was not covered by the Policy. The Insurer has now abandoned that ground.
The Trustee then dealt with the issue that it described as "procedural fairness" in the following terms:

We refer to your letter dated 5 March 2014 (“Procedural Fairness Letter”) to Mr Panos sent under cover of a letter to [the Trustee] of the same date which was apparently intended by [the Insurer] to afford [the Trustee] and Mr Panos “procedural fairness” in respect of the claim.
We take this opportunity to note that “procedural fairness” is not necessarily an appropriate concept in this context and to record our concern that [the Insurer’s] approach is apt to distract from its duty to perform the contract in utmost good faith.
The “Procedural Fairness Letter” invited [the Trustee] and Mr Panos to make submissions on more than 130 documents submitted to or obtained by [the Insurer] on the claim. This invitation was issued some 6 days before Mr Panos’s action against [the Insurer] was due to be heard in the Supreme Court and, as it turned out, 6 days before [the Insurer] made a decision that it was not satisfied that Mr Panos was Totally and Permanently Disabled. Although the letter stated “We particularly draw your attention to the material in this list which may be adverse to your claim” in fact no material in that list (or otherwise) was identified by [the Insurer] as being material that it considered was or may be adverse to the claim. We suspect that this omission underlies a number of matters we perceive as failures in [the Insurer’s] approach to this claim.
As you know, our entitlement to be paid a Total and Permanent Disablement (TPD) Benefit in respect of Mr Panos depends on the existence of a number of objective facts and proof to [the Insurer’s] satisfaction that Mr Panos has become incapacitated to such an extent that he is “unlikely ever to engage in or work for reward in any occupation or were the which he…is reasonably qualified by reason of education, training or experience”. [The Insurer’s] contractual duty is to evaluate the evidence on which it determines its state of satisfaction reasonably and with utmost good faith.
In our view this means, among other things, that [the Insurer] cannot merely remain silent and decline a claim based on suspicions or concerns which it has not shared with [the Trustee] or the member. The obligation for [the Insurer] to write to the insured about the evidence on which it proposes to act before deciding the claim is to actively engage in dialogue so that [the Insurer] is properly informed about matters important to the performance of the contract. This is not a rote exercise to give the insured the appearance of a hearing before the claim is declined. It appears from [the Insurer’s] Declinature Letter that there were a number of issues of concern to [the Insurer] which [the Insurer] should have specifically raised with [the Trustee] and the member before evaluating the evidence. We address these further below. In then

The Trustee then set out detailed arguments in relation to 10 matters (some of which apparently arose out of the Trustee’s reading of the first declinature), which were put by the Trustee with a view to persuading the Insurer that it should decide in favour of the claim upon its reconsideration. In view of the length of this aspect of the Trustee's letter, I will paraphrase the Trustee's arguments.
First (par 3), the Insurer did not fairly summarise Dr Kana's 16 January 2014 report, and to the extent that the Insurer was unsure about what Dr Kana meant, procedural fairness required the Insurer to ask him for an explanation.
Secondly (par 4), in relation to the Insurer's reference to Mr Panos' employment at the Hillside Nursing Home (the “Nursing Home”), it failed to note the evidence that it required retraining from his previous position. The employment was a light duties job in the nature of a work trial under the auspices of the workers compensation insurer. Mr Panos' evidence was that his employment was terminated due to his ongoing disabilities. If the Insurer had doubts about whether Mr Panos' evidence was untrue, it should have put the specific allegation to the Trustee and Mr Panos so that it could be answered.
Thirdly (par 5), if the Insurer was unsure about whether reports of Dr Giblin were to be relied upon it should have asked the Trustee before notifying an adverse decision. The Trustee required the Insurer to consider all of Dr Giblin's reports.
Fourthly (par 6), the Trustee enclosed a further report of Dr Diwan dated 3 March 2012, which the Trustee had received from Mr Panos on 9 May 2014. Dr Diwan advised that Mr Panos should change his profession and retrain into different employment, such as a registered nurse, which would "unload his spine" from the aged care or process worker type work.
Fifthly (par 7), the Insurer had referred to reports of four named doctors, but did not address the deterioration in Mr Panos' right and left knees in the period between November 2005 and May 2012. Mr Panos had ignored advice that he restrict his work to sentry work by retraining as an assistant-in-nursing, which consequently caused pain and disability. If Dr Kana failed to repeat the specialist’s restrictions, it should have been clarified with Dr Kana. Dr Kana's failure to specifically nominate the degenerative knee conditions did not mean they should be ignored.
Sixthly (par 8), the Insurer had been provided with reports concerning Mr Panos' psychological condition, and if it was in doubt about the continuing nature and effect of the condition, the Insurer should have sought clarification from the Trustee.
Seventhly (par 9), it was unreasonable and contrary to the requirements of good faith for the Insurer to place any reliance upon Mr Panos' refusal to permit the Insurer to have access to documents produced to the court on subpoena by third parties, as it was not simply a matter for Mr Panos to give his consent, as the third parties had a legitimate interest in the maintenance of the implied undertaking that the documents produced would not be used for any purpose other than those of the proceedings.
Eighthly (par 10), the Insurer had not properly used the vocational assessment of Mr Zaharis, as this summary was inaccurate and the Insurer had failed to appreciate its limitations. The assessor had not considered the full extent of Mr Panos' injuries, and had not properly considered the actual likelihood that Mr Panos would obtain work for which he was previously qualified.
Ninthly (par 11), the vocational assessment prepared by Dr McBurnie on 16 October 2013 suffered from a number of limitations including principally a failure to focus on the correct question, which was not a theoretical capacity for obtaining notional work, but the practical likelihood in reality of Mr Panos' obtaining work without substantial retraining.
Finally (par 12), the Insurer had taken an adversarial approach to the evidence rather than making a fair and reasonable evaluation in utmost good faith. The Insurer had relied upon statements in the medical reports and ignored the contents of Mr Panos' evidence in response. The Trustee identified three 'facts' on which the Insurer relied, at page 9 of the first declinature, which the Trustee addressed. First, whereas the Insurer had said that Mr Panos was able to work as an assistant in nursing at the Nursing Home for 9 months from September 2012, that position was for reduced hours as part of a workers compensation and rehabilitation and return to work program, and not normal work. The Insurer had failed to state to what degree it considered the differences between this work and work obtainable on the open market, and failed to act upon Mr Panos' evidence that he ceased at work due to the further aggravation of his back condition from the tasks and duties of that job.
Secondly, in relying upon the fact that Mr Panos was able to complete a security course and obtain a security licence in 2013, the Insurer did not state what was involved in completing the course or obtaining the licence, or note that it was done in compliance with the recommendations of the workers compensation insurer's rehabilitation consultant, and was completed before Mr Panos experienced the problems he did in May 2013 in dealing with a patient emergency.
Thirdly, the Insurer had noted that Mr Panos had apparently maintained a good muscle bulk despite his alleged restrictions and symptoms. The Trustee specifically requested that the Insurer should say so if it meant to suggest that Mr Panos could not have the musculature observed if he truly had the symptoms reported, and that Mr Panos was therefore being untruthful in his claim. The Trustee then referred to aspects of the medical evidence that would support Mr Panos' claim, and also to the fact that Dr McBurnie had approved and expressly recommended Mr Panos continue a gym and exercise program.
The Trustee enclosed additional evidence including a report of Dr Diwan dated 3 March 2014 and a report of Dr Noonan dated 12 May 2014.
Mr Panos served his affidavit dated 4 June 2014 on the Insurer on 6 June 2014.

Insurer's response to Trustee's request for reconsideration

On 17 June 2014, the court made orders by consent, which included an order that the Insurer respond to the Trustee’s request for a review of Mr Panos’ claim, and provide reasons for its review decision, no later than 20 June 2014. The court also ordered the Trustee to advise Mr Panos of its assessment of the review decision within 4 weeks of receipt of the Insurer’s decision. The matter was then listed for directions on 25 July 2014.
There is a strong implication in these orders that the Insurer would actually make a determination on the application for a review by 20 June 2014. Otherwise, there would appear to be no place for the Trustee to be able to advise Mr Panos of its assessment of the review decision within a further period.
On 17 June 2014, the Insurer sent a detailed letter to the Trustee in response to the Trustee's request that the Insurer reconsider the decision to decline Mr Panos' claim for the TPD benefit.
The letter stated that the Insurer had reviewed its first decision, but that review led it to decide to make further enquiries before completing its reconsideration, for reasons outlined in the balance of the letter. The Insurer had considered the additional evidence provided by the Trustee with its 21 May 2014 letter, reports of Dr Giblin dated 3 and 8 February 2014, and the material produced on subpoena in the proceedings, being documents produced by Dr Kana, Dr Diwan, Dr Haber, South Eastern Sydney Local Area Health Network, the Nursing Home and Employers Mutual Ltd.
The first response was to the Trustee's argument concerning the lack of 'procedural fairness' in the way the Insurer had not given to the Trustee an adequate indication of what it thought was the adverse material in the evidence, and the insufficient time that it gave to the Trustee to respond. The Insurer said, in part:

… [The Trustee] had access to the material at or about the same time that [the Insurer] did. [The Insurer] considers it was not unreasonable for it to expedite its decision in view of the fact that there was an impending hearing date. Whether [the Trustee] agrees or disagrees with [the Insurer's] view in this regard, the fact is that the hearing was adjourned, [the Trustee] has had just over 2 months to consider and respond to the material, [the Trustee] has done so and [the Insurer] has taken into account the matters [the Trustee] as raised in its response in the course of this review.

It is appropriate to make the comment in context that the impending commencement of the first hearing could not be a satisfactory reason by itself to justify the shortness of the time that the Insurer gave to the Trustee to identify any adverse material and respond to it, in the absence of any advice from the Insurer as to what its preliminary position was. Perhaps more importantly, however, the gravamen of the response was that it really didn't matter if the Insurer had given inadequate time to the Trustee, because the Insurer had agreed to review its original decision, and to receive additional evidence, and the Trustee had in fact had adequate time to consider and respond to the material with the benefit of the first declinature, when it wrote its 21 May 2014 request for a review.
Implicitly, the Insurer was saying that the first decision to reject Mr Panos' claim had become irrelevant, as was the first declinature, because the only outcome that would matter would be the result of the review and reconsideration. It will be necessary in due course to consider what the position of the parties is, as arising from their pleadings and submissions, as to whether it remains legitimate for the Insurer to defend its original refusal of Mr Panos' claim based upon the first declinature. As a practical matter, it looks very much, from the terms of this letter like the Insurer had effectively abandoned its first decision.
It will not be necessary to summarise the individual responses in the letter to the Trustee's arguments. It is sufficient to note the following: first, the Insurer said that it would obtain a further report from Dr Kana; it would put Dr Giblin's reports and Dr Diwan’s report to Dr McBurnie and Dr Ho for the provision of reports in response; it would put a report of Dr Patrick to Dr McBurnie and Dr Ho for report concerning the consequences of Mr Panos' knee injuries; it would seek further reports from Mr Ada and Dr Kana on the issue of Mr Panos' psychological condition; it would seek a further report concerning vocational assessment from the author of the Zaharis report; and it would ask Dr McBurnie and Ms Peterson and Ms Paterson to address the Trustee's criticisms of the Insurer's consideration of the vocational assessment.
The Insurer did not necessarily concede that its original consideration was inadequate. For example, the Insurer said in relation to the Trustee's claim that it had not sufficiently taken into account Mr Panos' evidence, that it did take that evidence into account, and it summarised most of that evidence in the letter. It added:

[the Insurer] accepts that Mr Panos' evidence supports his claim. It would be surprising if it did not. The difficulty in this case is that Mr Panos' own accounts of pain and incapacity are inconsistent with the level of observable pathology evidenced by the radiology reports and with the opinions of a number of medical experts, in particular Dr Ho, Dr McBurnie as well as Mr Panos' GP, Dr Kana. It is supported by the opinion of Dr Giblin. Different views can be taken as to the extent to which Mr Panos' evidence is supported by or inconsistent with the views of other medical experts. Mr Panos' account of the work he considers himself capable of performing is inconsistent with the jobs [the author of the Zaharis report] and Ms Peterson and Ms Paterson consider him capable of performing.

[The Insurer] does not consider the use of labels such as "the reality" particularly helpful in this context. [The Insurer] assumes that each of the experts who have provided their opinions have addressed what they considered to be the "reality" of Mr Panos' situation, as has Mr Panos himself. The issue for [Insurer] is how to balance the inconsistent evidence in reaching its determination…

It also said in relation to the vocational assessment issue:

Similarly, [the Insurer] does not consider [the Trustee's] characterisation of Ms Peterson's and Ms Paterson's report as considering theoretical and not actual capacity for work that is "notional" to be fair or accurate. The experts have set out their assessment of Mr Panos' work suitability, and have clearly had regard to the employment options identified by a labour market analysis indicating that the positions identified are actually available. However, as [the Trustee] has raised this issue, [the Insurer] considers it appropriate to obtain the experts' response.

The Insurer stated, on the issue of the significance of Mr Panos' work at the Nursing Home, that it was aware that Mr Panos was subject to medical restrictions at the time that he undertook that work, but it considered the work to be relevant to its decision, because it showed that Mr Panos was capable of satisfactorily completing a return to work trial, and that the employer was sufficiently satisfied with Mr Panos' performance of his duties at the conclusion of the work trial to offer him a casual position, and that such work was available.
Finally, in relation to the issue of Mr Panos' muscle bulk, the Insurer said that it was unexplained at the time the Insurer made its previous decision; there was no evidence from Dr Noonan in that regard; and the Insurer intended to put Dr Noonan's report to Dr McBurnie before making a reconsideration decision.
The Insurer invited the Trustee to advise it as a matter of urgency whether it had any difficulties with the approach suggested by the Insurer, and if so why.
On 18 June 2014, Mr Panos' solicitors wrote to the solicitors for the Trustee. They complained about the fact that the Insurer was now suggesting that it would engage in a further round of enquiries, and stated:

… [The Insurer] cannot yet again rely on its own failure to provide any reasonable enquiry as an excuse to delay reconsideration.
We respectfully submit that [the Insurer] has had enough time to assess and accept our client's claim. We further respectfully submit that [the Insurer] should not be entitled to delay this claim any further and we seek agreement from your client that they will join us in requiring [the Insurer] to make a decision without any further delay or obtaining any further evidence. Otherwise, this will just reward [the Insurer] for their unreasonable conduct in this matter which has been lodged over two years ago.

On 4 July 2014, the Trustee's solicitors wrote a letter to the Insurer in which they noted that in fact no decision had been identified in the Insurer's 17 June 2014 letter. They referred to orders made by the court on 17 June 2014, and said that those orders were made on the expectation that the Insurer would make a review decision.
The solicitors advised the Insurer that the Trustee did not agree with the Insurer's proposals for further investigations. In essence, the Trustee's solicitors gave brief reasons as to why the additional investigations were unnecessary, given the length of time that the original investigations had taken, and stated: "We consider that [the Insurer] should not be entitled to delay the claim assessment and avoid making a review decision under the guise of collection of further evidence. [The Insurer] has had sufficient time to collate evidence, form an opinion and clarify any ambiguous points".
On 25 July 2014, the court set the matter down for hearing for 3 days commencing on 9 February 2015. The Insurer was ordered to serve the balance of its evidence by 26 September 2014.

Mr Panos' second amended statement of claim

Mr Panos filed a second amended statement of claim on 19 November 2014, some eight months after he received the first declinature. This is the operative statement of claim for the purpose of the determination of these proceedings.
Mr Panos sought in par 4 of his claim for relief a declaration that the Insurer’s decision to decline his claim on 11 March 2014 after the commencement of the proceedings was wrong in law and therefore void. In relation to a request made by the Trustee on 21 May 2014 that the Insurer reconsider its decision, Mr Panos claimed in par 5 a declaration that the Insurer had constructively declined that request for reconsideration. In par 6 Mr Panos sought a declaration that he is totally and permanently disabled as defined. Thus, by par 6 of his claim for relief, Mr Panos appeared to assert that the Insurer was liable to pay the amount of the TPD benefit in respect of his claim as a debt (presumably following a determination by the Court that the facts satisfied the definition of TPD in the Policy).
Mr Panos made a number of preliminary allegations concerning the parties, and pleaded the relevant terms of the trust deed for the Fund and the Policy in pars 1 to 8.
Mr Panos then pleaded the factual basis of his claim that he met the definition for TPD in pars 9 to 22 as follows (these allegations were in substantially the same terms as the statement of claim):

9.   The Plaintiff was born on 15 July 1970. He completed year 8 schooling at Yallourn Technical College in Newborough, Victoria. He then undertook half of year 9 before leaving to take up full-time employment. He has not completed any schooling since.
10.   In 1989 the Plaintiff completed and Occupational Health & Safety course in nursing. In 2009 Plaintiff undertook a course and obtained a First Aid Certificate.
11.   Between 1985 and August 2006 the Plaintiff had a number of jobs including work as a process worker, security guard at a casino, storeman and bar worker.
12.   On or about 21 August 2006 the Plaintiff commenced employment at South Eastern Sydney Local Health District t/as Sutherland Hospital (“the Hospital”) as a Nursing Assistant working 38 hours per week on a permanent full-time basis.
13.   As an employee of the Hospital the Plaintiff became a member of the Fund and the (sic) paid valuable consideration so that he would be eligible for benefits from the Fund in the event that he suffered TPD…
15.   On or about 25 January 2010 the Plaintiff suffered a low back injury lifting 25 kg box in the course of his employment.
16.   On or about 18 March 2010 the Plaintiff suffered injuries to his back, neck, left shoulder in a motor vehicle accident on his way to work.
17.   On about 26 May 2011 the Plaintiff suffered injuries to his pelvis and chest in another motor vehicle accident.
18.   After that accident, the Plaintiff was not able to return to his job at the hospital and in fact, he has not carried out regular employment since 26 May 2011 with the Hospital.
19.   The Plaintiff’s employment by the Hospital was terminated on medical grounds on 16 October 2012.
20.   As a condition of his entitlement to ongoing workers compensation payments, on or about 13 July 2012 the Hospital’s workers compensation insurer arranged for the Plaintiff to undertake an unpaid training cause over six weeks at an aged care facility known as Hillside Figtree Nursing Home, Figtree (“the Nursing Home”). The Plaintiff also undertook retraining to obtain a new First Aid Certificate because the Certificate he had obtained in 2009 at expired.
21.   Between approximately October 2012 and 31 May 2013 the Plaintiff worked on restricted duties at the Nursing Home. After suffering further aggravation to his left shoulder and lower back conditions on 30 May 2013, the Plaintiff was unable to continue working after 31 May 2013.
22.   The Plaintiff contends that the work carried out at the Nursing Home was not regular, consistent or sustainable work and was in fact a failed rehabilitation attempt.

The same observations may be made, concerning the absence of an explicit pleading as to the date of commencement of Mr Panos' absence from his occupation, as were made in relation to the statement of claim.
Mr Panos’ attack on the procedure by which the Insurer had determined his claim was pleaded in pars 23 to 31 (all of these allegations bar that in par 23 and one of the particulars in par 31 were new) as follows:

23.   The Plaintiff lodged a claim for TPD with the First Defendant on or about 21 March 2012.
24.   At the date of commencement of proceedings by the Plaintiff no decision had been made by the Second Defendant.
25.   On the first day of the hearing of this matter on 11 March 2014, the Second Defendant notified the Court and it would be communicating in writing that it had made a decision on the Plaintiff’s claim to the plaintiff and the First Defended on that day. This did not occur.
26.   After the entire three-day hearing was adjourned the Plaintiff was notified by the Second Defendant by letter dated 18 March 2014 of the reasons for its decision to decline the Plaintiff’s claim on 11 March 2014.
27.   On 21 May 2014, the First Defendant on behalf of the Plaintiff sought reconsideration of his claim.
28.   To date the Second Defendant has refused to make a decision in reconsidering the Plaintiff’s claim.
29.   The Plaintiff elects to treat the Second Defendant’s refusal to make a decision on the reconsideration as a further constructive denial of the claim.
30.   In declining the Plaintiff’s claim for TPD benefits on 11 March 2014 and then failing to make a decision in reconsideration of the claim in the particular circumstances of the case, the Second Defendant acted in breach of its statutory and general law duties.
31.   Particulars:
(a)   failure to act with utmost good faith;
(b)   failure to form an opinion based on a real and genuine consideration of the evidence;
(c)   failure to act reasonably in assessing the Plaintiff's claim;
(d)   failure to assess the Plaintiff's claim at all after (sic) requested to do so;
(e)   failure to form an opinion that the Plaintiff satisfies the definition of TPD within a reasonable time;
(f)   failure to accept that the evidence submitted by the Plaintiff establishes that he satisfies the definition of TPD;
(g)   failure to pay the insured benefit;
(h)   failure to accept that the Plaintiff's failed rehabilitation attempt confirmed that he met the definition of TPD;
(i)   failure to seek out information and/or documents from the Plaintiff prior to declining his claim.

In the particulars contained in par 31, only the last four words of sub-par (d), and the whole of sub-par (i) are new.
It seems obvious that the particulars do not identify, with any specificity, acts undertaken by the Insurer that it should not have undertaken, or acts that it ought to have done, but did not do.
The particulars in sub-pars (a) to (c) appear merely to state or imply in general terms the Insurer's obligations in dealing with Mr Panos' claim.
Sub-paragraphs (d) and (e) appear to relate to Mr Panos' claim concerning the failure of the Insurer to reconsider Mr Panos' claim, in response to the Trustee's request, by the date the second amended statement of claim was filed. Nothing is said that identifies the reason, for example by reference to a term of the Policy or some other duty imposed upon the Trustee, as to why the Insurer was obliged to reconsider its decision as advised in the first declinature. It is not clear from the pleading whether Mr Panos’ case is that the Insurer was obliged to undertake a reconsideration of its decision on request, or whether the obligation on the Insurer to reconsider only arose if Mr Panos succeeds in establishing that the initial decision was ineffective for some reason.
The particulars in sub-pars (f) to (g) appear to support a case that the Insurer's decision will be vitiated merely because it did not accept the evidence provided and the submissions made by Mr Panos, and pay him the TPD benefit. As will be seen, the Insurer's decision cannot properly be attacked simply on the basis that it was wrong.
Sub-paragraph (i) appears to contain the only particular that in any specific way relates to the failure by the Insurer to take some step before it issued the first declinature. It is important because Mr Panos and the Insurer are at odds as to whether Mr Panos is entitled on his pleadings to put a case that the Insurer did not act with utmost good faith towards him, because it did not advise him of the basis upon which it was considering declining his claim for the TPD benefit, and gave him insufficient time to respond to its 'procedural fairness' letter dated 5 March 2014, before it issued the first declinature on 18 March 2014.
Mr Panos alleges that the Insurer failed to seek out information and/or documents from Mr Panos, prior to declining his claim. The particular obviously does not identify in any way what the information was or the documents were. The gravamen of Mr Panos' claim, as put at the hearing, was not that the Insurer failed to seek any particular information or documents from Mr Panos, before it made its decision. It was that the Insurer did not identify the evidence in the mass of material that it had been provided, upon which it contemplated acting to deny Mr Panos' claim, and then give him an ample opportunity to deliver to the Insurer further evidence and submissions, if he saw fit to do so.
Although, as noted, the declaration claimed by Mr Panos in par 6 of his claim for relief implies that it is his case that the court should determine whether the definition of TPD in the Policy was satisfied, so that the Insurer is indebted to the Trustee for the amount of the TPD benefit, Mr Panos does not appear to have pleaded the material facts upon which Mr Panos relies to base that claim.

Second submission by Trustee

On 13 January 2015, the Trustee filed a second submitting appearance, save as to costs.

Insurer's defence to the second amended statement of claim

On 13 January 2015, the Insurer filed in the Registry a defence to Mr Panos’ second amended statement of claim, after the time in which it had been permitted to do so by directions made by the Court, had expired.
On 9 February 2015, which was the first day of the hearing of the proceedings before me, I granted the Insurer leave to file its defence to the second amended statement of claim out of time.
The Insurer pleaded its response to pars 24 to 32 of the second amended statement of claim in pars 17 to 22 of its defence. The Insurer admitted that it had not made the decision as at the date of commencement of the proceedings. It said that the allegations in pars 25 and 26 concerning the circumstances in which Mr Panos had been advised, on the first day of the first hearing, that the Insurer had made a decision were irrelevant. It said that, on 10 March 2014, it made a decision to decline Mr Panos’ claim for a TPD benefit. It said that, on 17 March 2014, it sent a letter to the Trustee as policy owner notifying it of the decision, and the reasons for the decision. It admitted that, on 18 March 2014, its solicitor sent a copy of the Insurer’s letter to the Trustee to Mr Panos’ solicitor.
In response to the allegation in par 27 of the second amended statement of claim, concerning the request for a reconsideration of the decision, the Insurer, in par 19 of the defence, in substance admitted that it received the 21 May 2014 letter, and said that it responded by letter dated 17 June 2014. The Insurer did not plead the substance of the terms of that letter, or what its effect was. It is therefore necessary to consider the terms of the Insurer’s 17 June 2014 letter, to understand the effect of this pleading. For present purposes, it is sufficient to note that the Insurer provided a detailed response to the Trustee’s request. The Insurer implicitly accepted the Trustee’s request for a reconsideration; it gave a preliminary response in some detail, without making any decision, and advised the Trustee that it proposed to obtain certain identified additional information, including from medical practitioners, “before reconsidering the claim”.
The Insurer otherwise effectively denied the relevant allegations made by Mr Panos. In particular, the Insurer denied that it had constructively denied the Trustee’s claim, or that its conduct constituted a breach of its statutory and general law duties, as alleged by Mr Panos. The Insurer, in practical terms, denied that the first declinature was ineffective, denied that its failure to complete the reconsideration was a constructive denial, and denied that it was obliged to pay the TPD benefit to the Trustee (the last denial being implicit, because Mr Panos’ allegation in that respect was also implicit).
The Insurer did not make any allegation, in its defence, concerning its making any decision in response to the request for reconsideration. The evidence suggests that, in fact, on 14 January 2015, the Insurer delivered a letter in formal response to the request for reconsideration, in which it declined Mr Panos’ claim for a second time. The parties referred to this letter as “the second declinature”. Mr Panos’ solicitors wrote to the Insurer’s solicitors on 16 January 2015, to foreshadow an objection to the Insurer relying upon the second declinature at the hearing. As noted, the Insurer did not plead the second declinature in its defence filed on 13 January 2015, just one day before the issue of the second declinature. Ultimately, at the hearing, the Insurer did not press its tender of the second declinature, and accordingly accepted that it could not rely upon that matter in its defence.

Mr Panos' outline opening submissions

It is necessary to consider aspects of the outline opening submissions delivered by Mr Panos' counsel, shortly before the hearing before me commenced on the 9 February 2015. The reason is that a number of particulars of aspects of Mr Panos' case were first provided to the Insurer by means of this document. It is therefore significant to the identification, in more detail than can be found in the second amended statement of claim, of the case that Mr Panos wished to prosecute. It will be an issue whether Mr Panos was entitled to proceed with the case as identified in the outline opening, in relation to all of the issues dealt with in the document.
Mr Panos appears to have distilled his case concerning the inadequacy of the basis of the Insurer’s rejection of his claim for the TPD benefit in par 10 of his opening outline of submissions, in the following terms:

10. In the present case:
10.1.   [The Insurer] failed to form an opinion between 21 March 2012 and 17 March 2014 (one week after the hearing on 11 March 2014 was aborted due to [the Insurer’s] proposing to make a decision to decline the claim”.
10.2.   [The Insurer’s] decision of 17 March 2014 has “miscarry” for the reasons set out by the Trustee in its letter of 21 May 2014 (CB 865).
10.3.   [The Insurer] failed to reconsider the matter, until 3 weeks before the next hearing, thereby not allowing the Trustee sufficient time to review [the Insurer’s] further decision.

Paragraph 10.1 is in substance a claim that there was a constructive denial before the issue of the first declinature.
Mr Panos did not argue that, by agreeing to undertake the reconsideration of its decision, the Insurer had in some way abandoned its initial determination (even though the Insurer justified the shortness of the time that it gave Mr Panos to respond to the ‘procedural fairness’ letter, by saying that the Trustee had adequate time to consider the first declinature as part of the reconsideration). Paragraph 10.2 is a claim that the Insurers first decision to reject Mr Panos claim should be set aside because it was made in breach of the Insurers duty to act with utmost good faith.

The expert evidence

I will begin by considering the effect of the expert evidence that is before the court.
Both parties have chosen not to prepare expert evidence that was directed to proving the relevant issues on the basis that they would be determined by the court, and not the Insurer. Both parties have chosen to rely upon expert evidence that was intended to be used by the Insurer. Consequently, the court faces the difficulty of having to deal with a substantial body of expert evidence, produced by persons with different expertise, for different purposes, and addressed to different persons and organisations, at different times.
Dr Kana was the only expert witness who was cross-examined. That has had the consequence that the court has not had the benefit of the evidence of all expert witnesses being tested in any comprehensive way.
The practical consequence is that there is no other course open to the court but to sift through the evidence, consider its significance, and determine its weight and effect, relevant to all other evidence going to the particular issue.
Dr Giblin’s reports represent the only evidence in Mr Panos’ case that approximates expert evidence intended to be tendered in the proceedings. Dr Giblin, on a number of occasions, has expressed unconditional opinions that Mr Panos fell within the definition of TPD in the Policy at the relevant time.
The Insurer chose not to cross-examine Dr Giblin.
On the other hand, Dr Giblin is an orthopaedic surgeon, and no evidence has been provided concerning the specific expertise of orthopaedic surgeons to form opinions on the vocational prospects of workers with disabilities. I am prepared to accept that orthopaedic surgeons would have significant expertise in relation to the functional effects of disabilities of the nature that their specialty leads them to treat.
However, as I have observed above, Dr Giblin provided almost no explanation of his reasoning. He made observations about the likelihood in fact that Mr Panos would gain employment, without apparently carrying out any thorough vocational assessment.
Furthermore, Dr Giblin noted in his last substantive report that Mr Panos had ceased attending the gym since his 31 May 2013 injury at the Nursing Home, when it is known that Mr Panos at least attended the gym on 5 July 2013, about a month after the injury.
As Dr Giblin was not cross-examined, I must give some weight to his opinions, but I am not inclined to give them much weight in comparison with the opinions of experts whose expertise appears to lie in the area of vocational rehabilitation, and who have provided more conventional reports, that fully expose their reasoning and the assumptions or facts upon which they acted.
Dr Kana was for the whole period Mr Panos’ general practitioner. I accept that, as such, he would have had some level of expertise in vocational rehabilitation, although he did not claim that his expertise extended in any detailed way to having an understanding of the actual job market. Relevantly, the principal role of Dr Kana was, in relation to the various injuries and disabilities from which Mr Panos suffered, to issue certificates from time to time to employers or relevant authorities concerning Mr Panos’ capacity to work, and any restrictions that should be imposed upon his work.
Dr Kana has not prepared any expert report that, in a conventional way, states an opinion that, as at the relevant date, Mr Panos was incapacitated in a way that satisfied the TPD definition in the Policy, or given reasons for such an opinion. What he has done, from time to time, is to respond to questions that have been put to him by interested parties, for various different purposes.
In his 17 October 2014 report to the Insurer, he appears to have answered “no” to questions as to whether Mr Panos was physically capable of undertaking any of the occupations suggested by Dr McBurnie and Ms Peterson. Dr Kana gave very limited reasons, generally related to his perception of the requirements of the job, as to whether it involved heavy lifting, long periods of standing or sitting, or long periods of walking.
His final position in cross-examination was that he accepted Dr McBurnie’s opinion concerning Mr Panos’ capacity to work in assistant nursing and aged care (without, it appears, the limitations imposed by Dr McBurnie). He agreed that Mr Panos was capable of working as a security officer, probably a storeman, a bar attendant (provided he did not have to change kegs), and that, shortly after the injury that Mr Panos suffered at the nursing home, he was fit to return to work.
It appeared from my observation of Dr Kana in the witness box that he was significantly influenced by viewing the surveillance videos. He was not asked to elaborate on the reasons for his changes of opinion. In my view it is relatively obvious from looking at Mr Panos that he has the physique that would usually suggest regular and conscientious weight training. A substantial number of the medical professionals who have provided reports readily noticed the same thing. Dr Kana himself said, in his 29 November 2012 response to the workers compensation insurer, that he agreed that Mr Panos had good muscle size, meaning that he was all the time lifting heavy weights to maintain the size of his muscles. Dr Kana was aware of Mr Panos’ practice of working out with weights on a regular basis. The only inference that can be drawn is that, in some unidentified way, Mr Panos, by word or deed, led Dr Kana to form the professional opinion that Mr Panos suffered from disabilities that required him to be subject to employment restrictions that were inconsistent with the capabilities displayed by Mr Panos in the surveillance videos.
I do not ignore the evidence of Dr Noonan concerning the effect on Mr Panos’ physique of long-term hormone treatment with testosterone; which was accepted by Dr Giblin as being a sufficient explanation for Mr Panos’ physique.
However, once due allowance is made for that evidence, the fact remains that Mr Panos clearly informed many of the medical professionals of his habit of working out in the gym; Mr Panos acknowledged that practice in evidence; and even for the period in which he claimed to have stopped regularly going to the gym, he conceded that he regularly undertook similar exercise regimes at his home. Consequently, the positive evidence concerning Mr Panos’ regular weight lifting practices, together with the surveillance videos, must be taken to have had their natural consequences; which may well have been augmented by the hormone therapy.
Dr Kana’s change of position, together with the effect of viewing the surveillance videos, seriously undermines Mr Panos’ case. First, Dr Kana has positively accepted that Mr Panos is physically capable of engaging in a number of the occupations that Dr McBurnie or Ms Peterson concluded he could engage in. Dr Kana opined that Mr Panos may not need to be subject to lifting restrictions, and in particular a restriction of 20 kg, and he could travel for up to 2 hours. Not only does this make Mr Panos more employable than Mr Panos contends, but it tends to have the consequential effect of undermining Mr Panos’ position concerning his earlier attempts to find employment, where he claimed to be subject to the restrictions, as well as the opinions of medical professionals who assumed that he was subject to the restrictions.
Mr Panos accepted the admission into evidence of the reports prepared by Dr McBurnie, and the functional capacity assessment report prepared by Ms Paterson, without requiring either of those experts for cross-examination. Although Mr Panos opposed the reception of parts of Ms Peterson’s vocational assessment report into evidence, he also did not require her for cross-examination.
The reports prepared by Dr Bernie, and Ms Peterson and Ms Paterson, have been adequately reasoned, and appear to have been properly and professionally prepared. They are persuasive, and I have come to the conclusion that, in the circumstances, it is proper to give them considerable weight, and to generally accept the opinions expressed by those experts.
I have also concluded that I should give some weight to the opinions expressed by Dr Ho, Dr Perla and Dr Wallace, although those opinions were prepared for the workers compensation insurer, and I would exercise some care in relying upon them, not because of any doubt about the expertise or genuineness of the doctors, but because of some uncertainty as to the circumstances in which those opinions were provided to the workers compensation insurer.
The last word on Mr Panos’ psychological circumstances was given by the psychiatrist, Dr Prior on 3 December 2012. He said that Mr Panos had a Major Depressive Disorder, which was in partial remission, and that the disorder from which Mr Panos suffered would most likely significantly remit if he were to avail himself of appropriate anti-depressant medication, but that Mr Panos had indicated that he would not accept that treatment.
Mr Panos has complained that none of the doctors or other experts have given due weight to the deterioration in both of his knees. However, Mr Panos did not call any positive evidence that could provide a basis for the court to find that he could not reasonably engage in any particular occupation because of the state of his knees. He apparently ignored the advice of his specialist, when told to try to find a sedentary occupation, when he accepted employment at the Sutherland Hospital. He managed to work for a number of years before his employment was interrupted by the consequences of his second motor vehicle accident. I accept that his knees may be deteriorating, but that is a common condition. It may well limit his capacity for employment, but the court could not make any findings in that regard without proper evidence. There is also the possibility, referred to by one of the doctors, that Mr Panos could undergo knee replacement operations.

Mr Panos’ evidence

It is very important to Mr Panos’ case, if not crucial, that the court have good reason to accept his evidence, when he subjectively states how he experiences the consequences of his disabilities, and how they affect, in a real and practical way, his ability to obtain and retain particular employment, having regard to the practical requirements of that employment, and all other relevant matters, such as hours of work and travel.
I should say at the outset, in respect of the manner in which Mr Panos gave his evidence in the witness box, that he appeared to do so in a relatively straightforward way, that would not lead the court to reject his evidence in any substantial respects, based upon the manner in which he gave his evidence and his demeanour.
However, I have formed the view that I should not accept and act upon Mr Panos’ evidence on all issues relevant to his disabilities and their effects on him to the full extent of that evidence. It is not that I do not accept Mr Panos’ evidence at all on significant issues; but more that I believe Mr Panos has exaggerated his circumstances. It is a matter of degree, but significantly so, having regard to the final position of the expert evidence, which I have outlined above.
It appears to be reasonably clear that Dr Kana expressed a significant number of opinions, in his various certificates and reports, that Mr Panos had physical limitations, which Dr Kana readily abandoned in cross-examination after having seen the surveillance videos. I infer that Dr Kana formed the view that, in ways that were not exposed in the evidence, Mr Panos had caused Dr Kana, in the various consultations that led to the reports, to overstate the effect of Mr Panos’ disabilities. I must also infer that Mr Panos had some awareness that he was leading Dr Kana to form an overstated assessment of his disabilities.
In discussing the vocational report prepared by Ms Peterson and Ms Paterson above, I have set out at some length the contents of the report concerning Mr Panos’ performance of the various tasks that he was set, and the evidence concerning his apparent level of effort (see pars 363 – 364 above). It is self-evident from a comparison between the relevant parts of the report, and what is depicted in the surveillance videos, that Mr Panos seriously exaggerated his physical disabilities in the consultation with Ms Peterson and Ms Paterson. It is not necessary to list the individual aspects of this overstatement, because in my view it applied at least to all of the matters I have extracted above. That could not have happened accidentally, and the evidence requires a finding that Mr Panos intentionally overstated his disabilities, and tailored his performance on the various tests to support that appearance.
It is particularly concerning that, in performing a number of the tests, Mr Panos not only performed at a level below his capabilities, but he appeared to undertake lifting in a number of ways that were physically unsound, and which would instinctively be avoided by persons who have had long experience in weight lifting.
Mr Panos gave evidence, or made assertions at various times, concerning his limited ability to walk for long periods. Yet he was shown in one of the surveillance videos walking on a beach for almost an hour. At the end of the walk he clearly was not suffering from any ill effects. It is notorious that walking on sand is more difficult than walking on solid ground, particularly where appropriate footwear can be worn.
Mr Panos appears to have told Drs Perla, Wallace and Giblin that he had stopped going to the gym since his injury at the Nursing Home, when that was not true, because he at least went to the gym on 5 July 2013. He also asserted in cross-examination (T 39.44, 39.50) that he had not set foot in a gym since 2012.
Mr Panos stated in his resume that he had a forklift ticket. When asked in re-examination when he had obtained that ticket, he said that he had obtained it “under the table” from a person who would write a ticket for cash. That gives rise to an alternative damaging inference to Mr Panos’ credit, that he either did not receive the ticket at all, or he received it in highly questionable circumstances.
I accept that Mr Panos had, at the relevant date, relatively significant physical disabilities as a result of his various injuries. I accept that, at the relevant date, the existence of those disabilities caused Mr Panos to suffer pain, and other restrictions, as well as fear of suffering from further injury, which were not inconsiderable. However, I do not accept his evidence concerning the intensity or extent of the consequences. Once I have been forced to draw that conclusion, there is no rational or objective way for me to assess the real intensity of pain or extent of other disabilities, or the physical limitations that they impose upon him.

Likelihood of Mr Panos gaining employment

It must always be remembered that the definition of TPD in the Policy depends upon a degree of likelihood that Mr Panos will engage in any occupation for which he or she is reasonably qualified by reason of education, training or experience, that is expressed in terms of “unlikely ever”.
Evidence about the difficulties in the job market at a particular time, and an absence of success in job hunting is relevant, but it must always be assessed over a long-term perspective.
It must also be remembered that Mr Panos has the burden of proving that he is unlikely ever to be employed in the manner contemplated by the TPD definition.
I am not satisfied that Mr Panos is unlikely ever to obtain regular full-time or part-time employment as an assistant in nursing, which is an occupation that Mr Panos engaged in from 2007 to 2010. Dr McBurnie and Dr Kana agreed that he was physically capable of performing the work required by that occupation. As I have mentioned, he qualified for an Assistant in Nursing Certificate in 2007.
I am also not satisfied that Mr Panos is unlikely ever to obtain regular full-time or part-time employment in aged care. He obtained a Certificate III in Aged Care Work in 2007. The work that he did at the Nursing Home proves that he was capable of doing that work at the relevant date. Mr Panos claims that he retrained by means of a 6 week course, but he did not provide adequate evidence of what was involved in the supposed training course. In its 7 November 2012 report, Injury Treatment stated: “Following a Work Trial, Mr Panos has successful (sic) commenced employment with Hillside Nursing Home Figtree”. The positive evidence suggests that the Nursing Home required Mr Panos to undertake a work trial. That may have involved some specific training for the job so that Mr Panos could satisfy the requirements of his employer. I am not satisfied that Mr Panos was required engage in new education or training that would exclude this occupation under the principle established by Dargan.
I have also concluded that Mr Panos has not established that he is unlikely ever to obtain a position as a bar attendant. I accept that the evidence establishes that he would need to obtain a Responsible Service of Alcohol Certificate, and possibly also a Responsible Conduct of Gaming certificate. There is no evidence as to what the requirements are for obtaining those certificates. Evidently, since Mr Panos worked as a bar attendant from 2002 to 2004, the requirement for bar attendants to have these qualifications has been introduced. The evidence has not satisfied me that each certificate was not an “ancillary certificate” as that term was used in Dargan. In the absence of evidence to the contrary, I would not find that the two certificates involved a substantial amount of re-education or retraining compared to the level of training and experience that Mr Panos had from his earlier work as a bar attendant, to conclude that the need to obtain the certificates was not reasonably within his original education, training and experience.
I have not ignored Mr Panos’ reliance upon the fact that he ceased his original work as a bar attendant because of his knee injuries, but, having viewed the surveillance videos of the exercises that Mr Panos did on a number of occasions in the gym, I do not accept that his level of disability makes it unreasonable to expect him to accept employment as a bar attendant.
It is therefore not necessary to consider in any detailed way whether Mr Panos’ education, training and experience reasonably qualified him to accept work as a call centre operator, an inquiry clerk, or an inventory and supply officer. Mr Panos has had no history of performing work of that nature. His inexperience would obviously be a disadvantage to him in gaining employment of that type. On balance, however, I accept the opinion expressed by Ms Petersen.
Mr Panos gave evidence that he passed the security officer course with considerable difficulty. There was no evidence as to what was involved in doing that course. However, Mr Panos apparently had not worked as a security officer since 2001. The better view is, on balance, that on the relevant date Mr Panos’ education, training and experience was not sufficient, without substantive additional education and training, to engage in work as a security officer.
Mr Panos has failed to establish that he is entitled to the TPD benefit that the Trustee has claimed on his behalf under the Policy.
In principle, Mr Panos should be ordered to pay the Insurer’s costs on the ordinary basis. However, as there are other outstanding costs issues that must be dealt with, I will receive submissions on costs generally.

Orders

I therefore make the following orders:

The plaintiff’s claim is dismissed.

The parties are given leave to make submissions on all questions of costs, particularly as to the first defendant’s costs, and the costs thrown away as a result of the vacation of the first hearing.

Exhibits and documents produced on subpoena may be returned immediately in accordance with the rules.

**********

Amendments

31 August 2015 - Par 143 amended from Basten and Gleeson JJ to read Basten and Gleeson JJA

Par 143 final sentence of the quotation amended from "Nor was it in issue in at" to read "Nor was it in issue in Hannover Life Re of Australasia Ltd v Colella

Par 146 amended from "have a bearing of" to read "have a bearing on"

27 August 2015 - formatting amendments

Decision last updated: 31 August 2015

Medium Neutral Citation:	Panos v FSS Trustee Corporation [2015] NSWSC 1217
Hearing dates:	9, 10 and 11 February 2015
Date of orders:	27 August 2015
Decision date:	27 August 2015
Jurisdiction:	Equity
Before:	Robb J
Decision:	(1) The plaintiff’s claim is dismissed. (2) The parties are given leave to make submissions on all questions of costs, particularly as to the first defendant’s costs, and the costs thrown away as a result of the vacation of the first hearing. (3) Exhibits and documents produced on subpoena may be returned immediately in accordance with the rules.
Catchwords:	INSURANCE – accident and sickness insurance – superannuation trustee holding insurance policy covering total and permanent disablement of scheme members including the plaintiff – challenging decision of the insurer – whether plaintiff totally and permanently disabled within the meaning of the relevant superannuation trust deed and insurance policy – assessment of varied opinions in multiple expert medical reports as to significance of plaintiff’s disabilities – Court finds that plaintiff overstated his disabilities – whether plaintiff likely to gain employment in roles the plaintiff is qualified in – Court finds that plaintiff is likely to be able to undertake various jobs reasonably within his original education, training and experience – plaintiff failed to establish his entitlement to TPD benefit – plaintiff’s claim dismissed
Legislation Cited:	Evidence Act 1995 (NSW) Superannuation Industry (Supervision) Act 1993 (Cth) Superannuation (Resolution of Complaints) Act 1993 (Cth)
Cases Cited:	Allstate Life Insurance Co v ANZ Banking Group Ltd (No 5) (1996) 64 FCR 73 Beverley v Tyndall Life Insurance Co Ltd [1999] WASCA 198 Birdsall v Motor Trades Association of Australia Superannuation Fund Pty Limited [2015] NSWCA 104 Borg v Ramsay Health Care trading as North Shore Private Hospital Pty Ltd [2014] NSWSC 37 Chammas v Harwood Nominees Pty Ltd (1993) 7 ANZ Ins Cas 61–175 Hannover Life Re of Australasia Ltd v Dargan [2013] NSWCA 57; (2013) 83 NSWLR 246 Hannover Life Re of Australasia Ltd v Sayseng [2005] NSWCA 214; 13 ANZ Ins Cas 90-123 Hughes Aircraft Systems International v Airservices Australia (No 3) (1997) 80 FCR 276 Papamanos v Commonwealth Bank of Australia [2014] VSCA 167 Shuetrim v FSS Trustee Corporation [2015] NSWSC 464 Wyllie v National Mutual Life Association of Australasia (1997) 217 ALR 324
Category:	Principal judgment
Parties:	Peter Panos (plaintiff) FSS Trustee Corporation (first defendant) Metlife Insurance (second defendant)
Representation:	Counsel: M J Bleasel (plaintiff) S J Walsh (second defendant) Solicitors: Firths Compensation Lawyers (plaintiff) Mills Oakley (first defendant) Turks Legal (second defendant)
File Number(s):	2013/121809
Publication restriction:	None