Ward v MetLife Insurance Ltd
[2014] WASCA 119
•11 JUNE 2014
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
TITLE OF COURT : THE COURT OF APPEAL (WA)
CITATION: WARD -v- METLIFE INSURANCE LTD [2014] WASCA 119
CORAM: McLURE P
PULLIN JA
BUSS JA
HEARD: 3 FEBRUARY 2014
DELIVERED : 11 JUNE 2014
FILE NO/S: CACV 145 of 2012
BETWEEN: TERENCE ANDREW WARD
Appellant
AND
METLIFE INSURANCE LTD
Respondent
ON APPEAL FROM:
Jurisdiction : DISTRICT COURT OF WESTERN AUSTRALIA
Coram :STEVENSON DCJ
Citation :WARD -v- METLIFE INSURANCE LTD [2012] WADC 166
File No :CIV 2840 of 2011
Catchwords:
Insurance - Income protection policy - Whether appellant was 'Disabled' under the policy - Meaning of 'Occupation'
Legislation:
Nil
Result:
Appeal allowed
Orders made by trial judge set aside
Category: B
Representation:
Counsel:
Appellant: Mr G M G McIntyre SC & Mr J R Brooksby
Respondent: Mr P B Murdoch QC & Mr G R Hancy
Solicitors:
Appellant: Shine Lawyers
Respondent: Norton Rose Fulbright Australia
Case(s) referred to in judgment(s):
Nil
McLURE P: The appellant (plaintiff) appeals from the decision of Stevenson DCJ dismissing his claim against the respondent (defendant) for breach of a group income protection insurance policy (the Policy).
At all material times the appellant was employed by PricewaterhouseCoopers Services (PWC) and held the position of 'Director‑Tax and Legal Services'. That was one level below partner and was a salaried position.
The appellant's particular area of interest and expertise was the goods and services tax (GST). In his capacity as Director, the appellant was responsible for a group of around 20 PWC employees comprising a manager who reported directly to the appellant, senior and other consultants. He worked an average of between 50 ‑ 60 hours per week. The appellant's employment with PWC was terminated by agreement in November 2010 at which time his charge out rate for clients was $800 per hour.
By the first half of 2009 the appellant suffered a major depressive illness. After exhausting his sick leave, the appellant worked part‑time (three days per week) and was paid a partial disability benefit under the Policy for the period 31 August 2009 to 26 November 2009 and a (full) disability benefit under the Policy from 27 November 2009 to 31 December 2010. Payments under the Policy ceased in December 2010 after the respondent determined that the appellant was no longer 'disabled' for the purposes of the Policy. The appellant turned 55 in July 2009.
The Policy architecture
Defined terms in the Policy are signified by capital letters. I propose to use capitals for relevant defined terms in these reasons. PWC is the Employer under the Policy. The appellant was a Covered Person under the Policy and it appears there were deductions from his PWC salary for that cover.
The Policy provided, among other things, for a Disability Benefit, Partial Disability Benefit and Recurrent Disability Benefit.
Under cl 6.1, the respondent will pay a Disability Benefit if a Covered Person is Disabled after a waiting period of 90 days.
The term 'Disabled' or 'Disability' is relevantly defined to mean solely as a result of Illness occurring whilst this Policy is in force a Covered Person is:
(a)unable to perform at least one Income Producing Duty of his or her Occupation; and
(b)not working in any occupation, whether or not for reward; and
(c)under the regular care and following the advice of a Medical Practitioner.
The relevant defined terms in the definition of 'Disabled' include the following:
- Illness means sickness, disease or disorder;
- Income Producing Duty means a duty of the Covered Person's Occupation that generates at least 20% of the Covered Person's Monthly Income;
- Occupation means the employment or activity in which the Covered Person is principally Employed by the Employer;
- Monthly Income is the Income earned by the Covered Person in one calendar month;
- Income means a Covered Person's annual salary from their Occupation on the date of Disability.
Clause 6.4 of the Policy provides for cessation of the payment of a Disability Benefit. It relevantly provides:
We will cease to pay a Disability Benefit in respect of a Covered Person at the time the Covered Person:
(a)is no longer Disabled;
…
(c)attains [the age of 60].
A Partial Disability Benefit is payable, after a waiting period of 90 days, if a Covered Person is Partially Disabled (cl 7.1). Partially Disabled or Partial Disability means a Covered Person:
(a)has been Disabled for at least 14 days out of the first 19 consecutive days of the Waiting Period; and
(b)is unable to work in their Occupation at full capacity as a result of the Illness … resulting in Disability; and
(c)is working in their Occupation or any other occupation but only in a limited capacity; and
(d)is earning a monthly Disability Income less than their Monthly Income; and
(e)is under the regular care and following the advice of a Medical Practitioner.
Disability Income means any income earned by a Covered Person from personal exertion while Disabled or Partially Disabled when the Income is from their Occupation, or any other occupation.
Under cl 8, a Recurrent Disability Benefit is payable to a Covered Person who was paid a Disability Benefit or a Partial Disability Benefit and who had returned to employment with the Employer for a period of less than six months and during that period becomes Disabled or Partially Disabled from the same or a related Illness. The payment of a Recurrent Disability Benefit is treated as a continuation of the original claim for a benefit.
Clause 12 of the Policy provides for a limitation on the amount of a benefit. It relevantly provides:
We will reduce a Disability Benefit or Partial Disability Benefit payable to a Covered Person by:
(b)the amount of any income we believe the Covered Person could reasonably be expected to earn in his or her Occupation whilst Disabled or Partially Disabled.
By cl 16.1, a Covered Person will cease to be covered under the Policy effective from the earliest date of, inter alia, 'the Covered Person ceases to be Employed by the Employer'. Thus the appellant ceased to be covered by the Policy on the termination of his employment with PWC in November 2010.
The primary issue for determination in the court below was whether the appellant was Disabled under the Policy for the whole or part of the period from 1 January 2011 to the last day of the trial, being 27 September 2012 (the relevant period). The appellant was not covered under the Policy during the relevant period. The Policy will only respond to the appellant's claim if he had an accrued entitlement for a Disability as a result of Illness occurring whilst he was covered by the Policy.
The trial was conducted on the basis that prior to the relevant period the appellant had been Disabled and entitled to a Disability Benefit under the Policy. The live issue was whether the appellant's accepted Disability had ceased by, or during, the relevant period.
The trial judge's findings
The trial judge found against the appellant on all of the material issues in dispute at trial. In particular, he found that the appellant was not Disabled in the relevant period because he did not have an Illness; even if he did have an Illness, he had not established that he was unable to perform at least one Income Producing Duty of his Occupation; and further even if the appellant did have an Illness and was unable to perform at least one Income Producing Duty of his Occupation, that was not solely as a result of the Illness.
The trial judge also found that, on its proper construction, Occupation in cl 12.1 is to be determined by reference to the general or generic nature of the appellant's duties at PWC, not the actual duties he undertook. The trial judge found that the appellant was capable of working as an independent tax consultant.
Notwithstanding the finding that the appellant did not have any Illness, the trial judge found that the appellant had some mild physical and psychiatric symptoms in the relevant period, compendiously referred to by the trial judge (and in these reasons) as 'the plaintiff's symptoms'.
Grounds of appeal
The appellant contends the trial judge erred in law and/or fact in:
1.concluding that the plaintiff's symptoms did not constitute an Illness;
2.concluding that the appellant had not proved that he was unable to perform an Income Producing Duty of his Occupation that generated at least 20% of his Monthly Income;
3.concluding that the plaintiff's symptoms arising out of the appellant's alleged Illness did not prevent him from performing or undertaking at least 20% of his duties;
4.interpreting 'Occupation' in cl 12.1 as including an employment or activity other than an employment or activity in which the appellant was employed by PWC;
5.concluding that the appellant could undertake the vocation of an independent tax consultant, having regard to the occupation and duties he performed for PWC without having any regard to what the appellant could reasonably be expected to earn whilst Disabled or Partially Disabled.
Further background
The medical issues at trial included whether (1) the appellant suffered one or two major depressive episodes (as that expression is described in the American Psychiatric Association's Diagnostic and Statistical Manual of Mental Disorders, 4th ed, Text Revision (DSM‑IV‑TR)), the first in or around the middle of 2009 and the second in November 2009; and (2) the appellant's major depressive disorder was in partial remission or full remission.
The trial judge uses the expressions 'major depressive episode' and 'major depressive disorder' interchangeably. As explained in DSM‑IV‑TR the former is not a separate condition but a building block for the diagnostic code of major depressive disorder (p 345), which relevantly includes two sub‑types, 'major depressive disorder, single episode' and 'major depressive disorder, recurrent' (which requires the presence of two or more major depressive episodes): DSM‑IV‑TR, p 369 ‑ 376.
The expert evidence given at trial was based on assessments made in accordance with DSM‑IV-TR. In particular, the technical terms used, including remission and partial remission, were as defined in DSM‑IV‑TR (p 412).
The appellant was not assessed by a psychiatrist until after the respondent ceased paying Disability Benefits under the Policy. The qualifications of the experts at trial and their assessments of the appellant's condition in the relevant period are as follows:
Name
Position
Diagnosis
Leanne Young
Appellant's treating psychologist
Major depressive disorder, recurrent, in partial remission
Dr Helena Piirto
Consultant psychiatrist
Major depressive disorder, chronic, in partial remission
Dr Joseph Lee
Consultant psychiatrist
Major depressive disorder, recurrent
Dr Jonathon Spear
Consultant psychiatrist
Major depressive disorder, in remission (not recurrent)
The trial judge was not satisfied that the appellant suffered a second major depressive episode in November 2009. That outcome is not challenged in this appeal.
Dr Spear was called by the respondent. He saw the appellant on 11 January 2010, 14 October 2010 and 11 May 2012. In January 2010, he diagnosed major depressive disorder recurrent; in October 2010, major depressive disorder in remission; and in May 2012, major depressive disorder, recurrent, in partial remission. At the trial he changed his January 2010 and May 2012 diagnosis to 'major depressive episode in remission'.
In terms of personality style, Dr Spear described the appellant as a 'Type A personality', having an 'obsessional style' and a 'choleric melancholic (ie reflective) temperament'. He also described him as having 'some narcissistic traits with a sense of egocentricity, being very self‑centred and also having a very strong sense of entitlement' [165]. However, Dr Spear disavowed any suggestion of a personality disorder of any kind.
Ground 1
The appellant's written submissions on this ground are very brief and can be quoted:
The trial judge found on the evidence that some of the symptoms which the plaintiff was suffering during the relevant period were attributable to an illness, but that some of them were not. On the basis of the findings that some of the symptoms were not attributable to illness, he concluded that the plaintiff was not suffering an Illness for the purposes of the Policy. The Policy does not in its terms require that all symptoms of illness which an individual may experience are attributable to illness, in the form of 'sickness, disease or disability', in order to fit the definition of Illness in the Policy. The trial judge therefore, misdirected himself at law as to the proper interpretation of the Policy in that regard and consequently erred in fact in not finding that the plaintiff suffered an Illness for the purposes of the Policy.
The appellant interpreted the trial judge's reasons to mean that the sole basis for the finding of no Illness was that some of the plaintiff's symptoms were attributable to his personality type. When the court suggested there may be a separate and independent basis, namely that the appellant's major depressive disorder was in remission, the appellant contended the trial judge should have found that the disorder was in partial remission. Although not expressly raised in the ground of appeal, the parties joined issue on that subject. It is necessary to refer to the reasons in some detail.
The central findings in relation to whether the appellant was suffering an Illness during the relevant period are as follows:
I find that the plaintiff in November 2009, and at various times during the relevant period in differing degrees, experienced a collection of physical and mental symptoms which may be attributed in part to the 2009 major depressive disorder but also to his personality type. Some of the symptoms can be related to the normal aging process (loss of memory, loss of confidence). I do not accept that the symptoms relied upon are best described as 'Major Depressive Disorder ‑ Recurrent' (or partially recurrent). In my view, the proper diagnosis is that the 2009 major depressive disorder is in remission.
I find that during the relevant period the plaintiff had some mild physical and psychiatric symptoms consisting of, inter alia: reported difficulty making decisions; feeling tired when he met people; difficulty remembering telephone numbers and names; poor concentration; minor cognitive difficulties; general fatigue and tiredness; feeling under stress with low level anxiety; and a general lack of motivation. I will refer to the recorded symptoms, based on the self-report of the plaintiff and the findings of the medical witnesses, as 'the plaintiff's symptoms' [235] ‑ [236]. (emphasis added)
Thus the trial judge accepted that the plaintiff's symptoms were attributable in part to the accepted Disability that occurred in 2009 and concluded, without any explanation or discussion of the conflicting evidence, that the disorder was in remission. The trial judge then proceeded to conflate the question of Illness and attitude to work:
I find that the plaintiff's symptoms, with the benefit of the medical treatment he received, did not prevent him from being able to work during the relevant period, if he had been prepared to do so. Suitable work based on the plaintiff's skills, training and background has been identified.
In my view, consistent with the expert evidence of the plaintiff's personality type and structure and having received payments under the policy, the plaintiff adopted a position which is best described as 'a sense of entitlement', inasmuch as he had a right to receive ongoing payments under the policy.
There has not been any attempt by the plaintiff to engage in meaningful work of any kind during the relevant period, notwithstanding the strong advice of his professional advisers that he should do so, albeit on a graduated basis. There was a repeated concern expressed by them that the longer he did not return to work (or at least undertake some activity to give his life meaning) then the more difficult his position would become.
Contrary to this advice, the plaintiff chose to allow himself to become more entrenched in his thinking about his alleged right to payments under the policy. He has focussed and obsessed on his claim instead of putting some structure and responsibility into his life.
…
I am not persuaded that the plaintiff's symptoms consist of or constitute a recognisable psychiatric illness. As mentioned they do not constitute a major depressive disorder, whether recurrent or in partial remission. In my view, many of the plaintiff's symptoms are explained by the plaintiff's current circumstances and his personality type as set out in the medical evidence, in particular by Dr Spear [237] ‑ [241].
The work to which the trial judge refers is as an independent (which I take to mean self‑employed) taxation consultant, not a return to his former (full‑time) duties at PWC. Somewhat oddly, after reaching these conclusions the trial judge went on to consider the meaning of the defined term 'Disorder', rejected the respondent's claim that the appellant had to establish that he suffered a major depressive episode in the relevant period [254], and continued:
The uncontroverted medical evidence is that most patients only experience one episode of major depression in their life. Any ongoing symptoms after treatment may be recurrent or partially recurrent. The patient is more likely to be diagnosed as being in remission or partial remission, even though the patient continues to suffer mild symptoms arising out of the initial major depressive episode. In my view, in such circumstances the policy would continue to operate subject to the identified symptoms of the plaintiff on a reasonable interpretation constituting as a fact sickness or disorder, and subject to the further qualification in the policy that the plaintiff is 'unable to perform at least a duty of his employment that generated at least 20% of his income' solely as a result of the ongoing symptoms.
In my opinion, the questions [sic] is not whether the plaintiff's symptoms can properly be categorised as a major depressive episode, with or without any of the various qualifiers including remission or recurrence, at any point of time during the relevant period [258]‑ [259]. (emphasis added)
The trial judge, having accepted that the appellant had suffered a major depressive disorder in 2009 which constituted an Illness for the purpose of the Policy, identified the relevant issue as being whether 'the plaintiff's symptoms thereafter constituted a sickness or disorder for the purpose of the policy' [260] and continued:
I am not persuaded that the plaintiff's symptoms during the relevant period constitute a 'Disorder' for the purpose of 'Illness' under the policy. This is my view irrespective of whether the plaintiff's symptoms can be said to arise wholly or partially out of the 2009 major depressive disorder. I consider that some of the symptoms are, as mentioned, attributable to his personality type. They cannot be said to arise out of any sickness or disorder under the terms used in the policy.
I am not satisfied that the plaintiff's symptoms during the relevant period are such that they can be said to constitute an 'Illness' as that term is defined by the policy [261] ‑ [262].
Thus the trial judge concluded there was no disorder and therefore no Illness under the Policy because some of the symptoms were attributable to the appellant's personality features and type: [261], [266] and [267].
The trial judge does not identify the particular symptoms said to be attributable to the appellant's personality type or why the other symptoms attributable to his major depressive disorder were not a disorder and therefore not an Illness. If the distinction is relevant, such an omission would be a serious failure to provide adequate reasons.
However, I am satisfied that the distinction is not relevant. The insurer must take an insured as it finds him or her, including their personality types and features. If those personality matters underlie, intensify or delay recovery from symptoms attributable to a major depressive disorder, they are not, causally or otherwise, relevantly separate. Moreover, there is no support in the expert evidence for allocating some (unspecified) plaintiff's symptoms to his personality type and others to his mental illness.
Further, it can be inferred that the trial judge did not regard the issue of partial or full remission as relevant to his finding of no Illness. That inference is based on his failure to give a reasoned explanation for his conclusion that the appellant's major depressive disorder was in remission. The only evidence to that effect came from Dr Spear. In his report of May 2012, he diagnosed the appellant as suffering from 'major depressive disorder, recurrent, in partial remission'. He resiled from his assessment that the disorder was recurrent and in partial remission in examination‑in‑chief. His evidence on the subject is instructive. The trial judge asked:
Given what you just said your diagnosis is, you left out the word partial. Is that just a tautology, remission and partial remission?---Well - - -
Is that the same thing?‑‑‑Look, I'm not an expert, okay, in classifications and - and things. And it - it becomes really difficult when you get into this area because he does have some very mild symptoms of depression, I guess. So any symptoms of depression, if somebody had them persistent from the first episode, you could classify him as having major depressive disorder in partial remission. But my view is because he had that spell, at least a spell of wellness and maybe several spells of being well, it's difficult to say that that's still part of this first depressive episode. Because he's had periods of wellness. So - so- - -
…
[But I'm just] trying to understand whether there's any difference between in remission and in partial remission or whether it's, in fact, the same thing?‑‑‑Well, we're probably describing the same sort of thing. It wouldn't surprise me. He's got some mild residual symptoms of something. It could be from major depression in partial remission if that was your view about it. As I say, it's not my view at the moment (ts 285 ‑ 286).
The DSM‑IV‑TR defines partial remission and full remission for a major depressive disorder, single episode as follows:
Full remission requires a period of at least two months in which there are no significant symptoms of depression. There are two ways for the episode to be In Partial Remission: 1) some symptoms of a Major Depressive Episode are still present, but full criteria are no longer met; or 2) there are no longer any significant symptoms of a Major Depressive Episode, but the period of remission has been less than two months (DSM‑IV‑TR, p 412).
Dr Spear did not attribute the residual symptoms to the appellant's major depressive disorder. He said they 'could be attributed to other things such as for example a combination of a high consumption of caffeine together with his personality style ' (ts 286). The trial judge did not accept Dr Spear's evidence that the depressive disorder made no contribution to the residual symptoms or that high caffeine intake was a contributory factor.
Having regard to Dr Spear's repeated diagnostic inconsistency and the fact that the trial judge did not accept Dr Spear's explanation of the plaintiff's symptoms, the overwhelming weight of the evidence is that during the relevant period the appellant suffered a major depressive disorder in partial remission; that is, some symptoms of a major depressive disorder were still present but the full criteria were not met. That is a mental disorder under DSM‑IV‑TR and, as the trial judge recognised, a Disorder and thus an Illness under the Policy.
For these reasons, I would uphold ground 1.
Grounds 2 and 3
It is difficult to pinpoint the actual basis for the trial judge's finding that the plaintiff's symptoms did not result in him being unable to perform at least one Income Producing Duty of his Occupation in the relevant period. It seems to me the reasoning is best captured in [279] ‑ [282]. It begins:
I am not persuaded on the evidence that 'most of the duties of the then job of "Director ‑ tax and legal services"' are now beyond the capability of the plaintiff. As mentioned, in my view, the plaintiff was capable of working during the relevant period notwithstanding his symptoms [279].
I take the last sentence of that quotation to be a reference to [237] which is his finding that the plaintiff's symptoms did not prevent him from being able to work during the relevant period if he had been prepared to do so. It is clear from its context that the trial judge is there referring to work other than the appellant's Occupation which was his position as Director-Tax and Legal Services with PWC.
The trial judge's findings as to the appellant's duties in that position are identified by the trial judge as follows:
The evidence discloses that, in his role at PWC, the plaintiff was required to recruit and manage about 15 ‑ 25 staff; manage and deal with clients; market the business and bring in new work; set and meet budgets and the billing targets of the firm; attend meetings and give presentations; prepare and oversee reports and advise clients, together with what the plaintiff described in his written closing submissions, as 'a myriad of other duties which fall within the ambit of a busy multinational accounting firm (in which his services were booked out by the firm at about $800 per hour)'. Intrinsic in the actual duties of the plaintiff in the performance of his role, is the requirement that he is able to communicate effectively with staff and clients, manage their affairs, prioritise their demands, and make timely and appropriate decisions in all aspects of his duties. This aspect of the role, as opposed to the identifiable actual duties, is in general terms what the plaintiff says he cannot do [280].
The parties disagree as to the findings of the trial judge in [281] which states:
The plaintiff's submission is that the tasks or duties of problem-solving, multi-tasking and managing a number of projects should correctly be considered to be 'income-producing duties' of the plaintiff's 'Occupation'. Accepting this proposition is correct, in my opinion the medical evidence of the plaintiff's symptoms does not demonstrate that the deficiencies relied upon mean the plaintiff could not perform at least one duty that generates at least 20% or consists of 20% of his duties [281]. (emphasis added)
The appellant contends the trial judge accepted the correctness of the proposition, which contains both a factual and legal component. The respondent says the trial judge assumed, without determining, the correctness of the proposition.
The trial judge concluded:
In my view, in order to give business efficacy to the definition of 'Income Producing Duty' in the context of the policy of insurance insofar as it applies to the plaintiff, the proper approach is to determine whether the symptoms arising out of the plaintiff's alleged illness prevent him from performing or undertaking at least 20% of his duties. Based on the evidence adduced at trial, and for the reasons mentioned, I am not so persuaded [282].
It is clear that Occupation, for the purpose of the expression Income Producing Duty, is a reference to the activities undertaken by the appellant in his position as Director‑Tax and Legal Services at PWC. The fact that the appellant was no longer employed by PWC in the relevant period is irrelevant. The focus of the defined expression is on a duty or duties that generate at least 20% of the Covered Person's salary on the date of the Disability, which in this case was in mid‑2009. The appellant will be Disabled if, inter alia, he was, in the relevant period, unable to perform at least one duty of the appellant's position as Director‑Tax and Legal Services at PWC that generated at least 20% of his monthly salary as at the date of his Disability in mid‑2009.
In [279] the trial judge addressed the wrong question, namely whether most of the duties of the appellant's position with PWC were now beyond the capability of the plaintiff.
In [281] and [282] the question changed to whether the plaintiff's symptoms prevented him from performing at least 20% of his duties as Director‑Tax and Legal Services at PWC. That is still the wrong question. The correct focus is on what generated at least 20% of the appellant's monthly salary at the time of his Disability and whether, in the relevant period, the appellant was unable to perform at least one duty of his position as Director‑Tax and Legal Services at PWC that generated that percentage of his salary at the time of his Disability.
There will be no material difference between '20% of his duties' and '20% of his salary' if there is a direct and proportionate relationship between a person's duties and salary. That is more likely to be the case if the position can be performed on a part‑time basis. An employee on a 38 hour, five day working week who is paid pro‑rata for the time at work, would be Disabled if he was unable to work one day per week. It is important to remember that the concept of Disability informs the entitlement to both a partial and full Disability Benefit under the Policy.
Against that background, I return to the contentions of the parties relating to [281], which must be read with [280].
I agree with the respondent that the trial judge did not make a finding that the appellant's duties at PWC included problem‑solving, multi‑tasking and managing a number of projects. He did not make a finding because he did not regard it as affecting the outcome. Another key to understanding the trial judge's reluctance to make a finding emerges from [280] in which he draws a distinction between the appellant's 'actual duties' and the skills and capacity (or functioning) required to carry out those duties. The distinction is meaningless. Having regard to the type of work undertaken by the appellant (advising clients on taxation and legal matters (focusing on the GST), supervising, managing and generating work for the staff in his team, marketing and other 'rain making' duties and his level of seniority reflected in his high charge out rate) the only reasonable finding open on the evidence is that the performance of the appellant's duties involved problem‑solving, multi‑tasking and simultaneously managing a number of projects.
The trial judge's error is apparent in the balance of [281]. His focus was on whether the appellant had demonstrated that his deficiencies in problem‑solving etc during the relevant period meant the appellant could not perform 'at least one duty that ... consists of 20% of his duties'. It is clear from the broader context (in particular [279] and [237]) that the trial judge had in mind his earlier finding that the appellant had the capacity in the relevant period to provide independent taxation advice to clients. However, for the reasons discussed below that is to confuse the appellant's Occupation as at the date of his Disability with another and different occupation. Personal tax advisory work was only one aspect of a broader sweep of integrated duties involved in leading an income generating unit.
The trial judge should have found that the appellant's deficiencies in problem‑solving, multi‑tasking and managing a number of projects, in combination, impaired his capacity to perform all facets of his duties with the consequence that throughout the relevant period the appellant was unable to perform at least one or more duties of his position at PWC that generated at least 20% of his monthly salary as at mid‑2009.
I would uphold grounds 2 and 3. The correct finding is that the appellant remained Disabled throughout the relevant period. Thus whether or not the respondent is entitled to invoke cl 12.1(b) of the Policy is not hypothetical.
Grounds 4 and 5
Clause 12.1(b), set out above, authorises a reduction in the amount of the Disability Benefit by 'the amount of any income we believe the Covered Person could reasonably be expected to earn in his or her Occupation whilst Disabled or Partially Disabled'. The amount of the Disability Benefit is the 'Disability Monthly Benefit' which is defined as the lesser of three things, including 75% multiplied by the Monthly Income (being the salary from the person's Occupation on the date of the Disability in one month) and $25,000.
The focus of attention is on the meaning of the word 'Occupation'. The appellant contended that it meant his employment with PWC. The respondent contended that it is not confined to his employment with PWC but is to be ascertained by reference to a general (or generic) description of the work undertaken which is something broader than his actual position with PWC.
The trial judge accepted the respondent's contention. He said:
In my view, the proper interpretation of 'Occupation' involves an objective categorisation or description of the duties undertaken with, if necessary, any degree of specialisation of the employed person. With respect, in my opinion, any other view would not admit commercial sense so far as the plain intention of cl 12.1(b) is concerned, namely, to permit the defendant to reduce the disability benefit payable under the policy if the covered person 'could reasonably be expected to earn'.
If 'Occupation' was interpreted in the way contended for by the plaintiff, the clause would have no work to do and not make commercial sense [298] ‑ [299].
The trial judge said the respondent's contention made complete sense because it enabled the insurer to reduce a benefit if it believed the Covered Person could work in his Occupation but, for whatever reason, chooses not to. The trial judge held that even if the appellant's construction of Occupation in cl 12.1(b) is correct, the result would be the same because the appellant could work in his Occupation but chose not to do so. That conclusion reflects the trial judge's erroneous approach to Disability in [281].
The trial judge found that the appellant was capable, having regard to his occupation, skills and training, of working as an independent tax consultant, the average salary of which was about $83,000.
Accordingly, if the trial judge was wrong in concluding that the appellant was not Disabled, he would have held that the respondent is entitled pursuant to cl 12.1(b) to deduct from the Disability Benefit payable to the appellant the sum of $83,000 calculated on a pro‑rata basis for the relevant period.
There can be no doubt that on a literal interpretation of cl 12.1(b) the word 'Occupation' has the defined meaning. Thus the clause relevantly provides for a reduction in a Disability Benefit or Partial Disability Benefit payable to a Covered Person by:
(b)the amount of any income we believe the Covered Person could reasonably be expected to earn in [the employment or activity in which the Covered Person is principally Employed by the Employer] whilst Disabled or Partially Disabled.
The defined term 'Occupation' is to be contrasted with the use of the undefined word 'occupation' throughout the Policy. That is apparent from the expression 'Occupation or any other occupation' in par (c) of the definition of Partially Disabled and in the definition of Disability Income. Prima facie, the defined term Occupation has the same meaning in cl 12.1(b) as it does in other provisions of the Policy, including in par (a) of the definition of Disabled, which is to be contrasted with the expression 'not working in any occupation' in par (b) of that definition. This view is reflected in the trial judge's approach to the meaning of Disability.
Notwithstanding use of the word 'is' in the definition of Occupation, continuing employment by the same Employer, in this case PWC, is not mandated. What is meant is employment with any employer that corresponds with and is equivalent to the employment or activity in which the appellant was principally employed by PWC at the time of thedisability in mid‑2009. There is no correspondence and equivalence between the appellant's Occupation and that of an independent tax consultant, just as there is no equivalence between a salaried partner in a large law firm and a sole practitioner. Although they are in the same profession, their respective roles, duties and income would be different, as is their Occupation. The quantum of the benefit and the size of the premium (see the Second Schedule) is linked to the actual income of the Covered Person as at the date of the Disability. The term Occupation in cl 12.1(b) must have the same meaning as it has in the definition of Disability.
The unambiguous language in which cl 12.1(b) is expressed is also consistent with the commercial purpose of the Policy and good commercial sense. The intent and purpose of that provision is to reduce the size of the benefit if the Covered Person could reasonably be expected to work in their Occupation on a part‑time basis or, if a person is Partially Disabled and already working part‑time in their Occupation, could reasonably be expected to work longer hours in that Occupation. This construction would cover the person who could work in their Occupation but chose not to.
The respondent did not contend that the trial judge erred in failing to find that the appellant could reasonably be expected to work part‑time in his Occupation. For these reasons, I would uphold ground 4.
Ground 5 assumes the correctness of the trial judge's construction of Occupation in cl 12.1(b). In particular, the appellant claims that the trial judge failed to take into account the fact that the appellant was in a highly specialised field of taxation (the GST) and assumed he could work full‑time as an independent tax consultant. In view of my conclusion on ground 4, it is unnecessary to address ground 5.
Conclusion
I would allow the appeal and set aside the orders made by the trial judge. In lieu thereof, I would order that the respondent do pay the appellant the Disability Benefit for the relevant period without reduction under cl 12.1(b). I would hear from the parties on the precise terms of the orders to be made.
PULLIN JA: The appellant appeals against a judgment entered in favour of the respondent dismissing the appellant's claim.
The appellant worked as a director of Coopers & Lybrand, later PricewaterhouseCoopers (PWC). He claimed an entitlement to payment of disability benefits under a group income protection insurance policy (the policy) issued by the respondent to PWC because he claimed he was disabled due to the fact that he was clinically depressed. He was unable to work and, pursuant to the policy, the respondent paid a partial disability benefit from 31 August to 26 November 2009, and a disability benefit from 27 November 2009 to 31 December 2010.
The respondent ceased paying benefits under the policy on 31 December 2010 because it determined that the appellant was no longer 'disabled' as that term was defined in the policy. The appellant commenced proceedings seeking payment of benefits from 1 January 2011. The parties agreed that the issue to be determined was what the appellant's entitlements were under the policy (if any) in the period from 1 January 2011 until the conclusion of the trial. This was defined as 'the relevant period'. After a trial, Stevenson DCJ dismissed the appellant's claim.
The policy terms
The policy provided in cl 6.1 that the respondent would pay a disability benefit if a covered person was disabled after the waiting period had ended. The appellant was a covered person and there is no dispute that the waiting period had ended. The respondent's liability to pay the disability benefit during the 'relevant period' only arose under cl 6.1 if the appellant was 'disabled' within the meaning of the policy.
Under the policy, 'disabled' means:
… solely as a result of Illness or Injury occurring whilst this Policy is in force [and the appellant] is:
(a)unable to perform at least one Income Producing Duty of his or her Occupation; and
(b)not working in any occupation, whether or not for reward; and
(c)under the regular care and following the advice of a Medical Practitioner.
The appellant did not suffer 'Injury'. 'Illness' was defined to mean 'sickness, disease or disorder'.
He did not suffer a 'disease'. If the appellant was 'disabled' he had to show he was suffering a 'sickness' or a 'disorder'. Neither of those terms were defined in the policy.
The requirements of (b) and (c) of the definition were met.
The word 'Occupation' was defined to mean 'the employment or activity in which the person/Covered Person is principally Employed by the Employer'.
'Income Producing Duty' was defined to mean 'a duty of the Covered Person's Occupation that generates at least 20% of the Covered Person's Monthly Income'.
The appellant's background and work at PWC
The appellant was born in 1954, went to university in his late teens and twenties, commenced work with the Australian Taxation Office and gained expertise in relation to GST and, in about 1986, commenced work with PWC. The appellant worked with PWC for 17 years and then, in 2003, was appointed a director. This was one level below the position of partner [30]. His position at PWC carried the title 'Director - Tax and Legal Services (GST)'. His work involved managing staff as well as providing tax and legal services. In more detail, he would recruit staff, counsel staff, develop staff, manage clients, locate clients, monitor projects for legal and business suitability, manage budgets and planning, solve problems and make presentations [171]. The Perth office of his employer consisted of about 350 people and he had direct supervision of a team of between 15 to 20 people. His team consisted of a manager reporting directly to him, with senior consultants and consultants reporting to the manager. The appellant had overall responsibility for the team. His personal charge‑out rate was about $800 per hour [30]. His fee‑paying work involved giving advice to clients on GST implications involved in the acquisition of target businesses or entities, advising clients subject to ATO audits and assisting clients establishing a new division on how best to comply with the GST obligations [31]. He did not share profits. As a director he received a salary.
The appellant suffers a bout of depression in mid 2009
In 2009, before May, the appellant noticed problems with discharging his duties [32] ‑ [33]. He had a 'meltdown' at work and, on 27 May 2009, he attended Dr Downing [33]. Dr Downing was a general practitioner who had daily experience in diagnosing and treating people suffering with depression. Although no formal diagnosis of depression was made by Dr Downing, on 27 May 2009 he prescribed Cymbalta [33], which is an antidepressant medication. He also referred the appellant to Ms Leanne Young, a clinical psychologist.
On 1 June 2009, the appellant attended at the Joondalup Hospital due to a reaction to the Cymbalta. On 2 June 2009, he attended Dr Downing and Ms Young [34] and [89]. Based on her assessment of the appellant on 2 June and 19 June 2009, Ms Young's opinion was that the appellant's symptoms at that time 'were in keeping with a diagnosis of "Major Depressive Disorder: Moderate"' [89]. In cross‑examination, however, Ms Young accepted she had not herself made a diagnosis of major depressive disorder. In her opinion, the appellant was in partial remission [107]. Despite this, and the fact that a diagnosis of a major depressive episode was not made by a qualified medical practitioner at the relevant time, the respondent did not 'expressly challenge the correctness of that diagnosis' [224]. In any event, the trial judge accepted that the appellant suffered a major depressive episode in early/mid 2009 [225].
The expression 'Major Depressive Disorder' is an expression which comes from the American Psychiatric Association's Diagnostic & Statistical Manual of Mental Disorders, 4th ed, Text Revision (DSM‑IV‑TR). It lists nine symptoms and, in effect, provides that if five or more are present, and if the symptoms do not meet or are not accounted for by certain other matters (eg, bereavement) and the symptoms cause 'clinically significant distress or impairment in social, occupational or other important areas of functioning', then the diagnosis of a Major Depressive Disorder (or episode) may be made. I will abbreviate the expression, 'Major Depressive Disorder (or episode)' and refer to such a disorder as 'Depression'.
It is important to observe that some of the criteria include what most people will experience from time to time throughout their life. For example, they include 'fatigue or loss of energy nearly every day'. The mere existence of fatigue or loss of energy nearly every day for a period of time will obviously not support a diagnosis of Depression.
The trial judge said, and it is not in dispute, that if the appellant had Depression diagnosed in accordance with the criteria for such an illness pursuant to DSM‑IV‑TR, then, 'while that diagnosis continued to apply, … [the appellant] would satisfy the definition of "Illness" for the purpose of the policy' [257]. On 2 June 2009, Dr Downing prescribed another antidepressant drug. By 10 June 2009, Dr Downing had noticed that the appellant was much calmer and on 17 June 2009, noted that his employer was being supportive [43] and [45].
He was off work from 2 June 2009 for six weeks. On 24 June 2009, he told Dr Downing that he was going well and enjoying life again [46]. On 8 July 2009, he went back to work three days a week. When he saw Dr Downing on 23 July 2009, Dr Downing made notes as a result of what he was told by the appellant. The notes read that he was 'coping, not dreading going back to work, slight boredom, stressor bits are bits he enjoys, decision‑making is good, confidence level is back, three days a week for two months, aiming to full‑time by Christmas' [202].
The respondent pays a partial disability benefit
On 31 August 2009, the appellant was paid a partial disability benefit by the respondent [2].
The appellant gives up work for good
By mid November 2009, the appellant gave evidence that he could not face going to work [50]. On 27 November 2009, he went off work again and had not worked again at any income‑earning occupation before the conclusion of the trial [53].
The appellant's condition in 2010
The appellant saw a psychiatrist - Dr Spear - on 11 January 2010 and this was for the purpose of supporting his claim under the policy [59]. During 2010, he continued to see Dr Downing. The trial judge referred to the evidence about the appellant's condition in 2010 and 2011 in considerable detail. The same level of detail is not necessary here. All that is necessary to record here is sufficient to allow an understanding of the gist of the evidence. On 15 February 2010, Dr Downing made notes that the appellant complained about not sleeping well and that he was concerned about insurance issues and financial woes. On 17 March 2010, Dr Downing noted 'gradual improvement' [67]. When Dr Downing saw him on 22 April 2010, although he complained of pressure, Dr Downing saw no need to have him see a psychiatrist [69]. On 2 August 2010, Dr Downing noted that the appellant reported he was 'much better'. On 29 October 2010, the appellant reported to Dr Downing he felt he had 'changed as a person' [71]. By the end of 2010, he enrolled at the University of Western Australia in units in Latin and ancient history [55].
The respondent ceases payments under the policy
On 31 December 2010, the respondent ceased making payments under the policy [3].
The appellant's condition in 2011
On 17 February 2011, the appellant prepared a detailed submission to the respondent, supporting his claim under the policy for further payments [78].
On 1 March 2011, he reported to Dr Downing that he would like to return to work. Dr Downing and Ms Young both thought that he 'needed to return to work'. He continued to see Ms Young in 2011 ([98] and [99]) and he saw Dr Lee, a consultant psychiatrist retained by the appellant to prepare a report for the pending litigation. He expressed the opinion, based on his assessment of the appellant on 31 March 2011, that the appellant was 'capable of returning to work but would need the help of a graduated return‑to‑work … programme ' [132].
The appellant issues his writ
The respondent did not make payments as claimed by the appellant. On 30 August 2011, the appellant issued a writ claiming benefits under the policy from 1 January 2011.
The appellant's condition in 2012 up until the end of the trial
The trial judge did not refer to much evidence about the appellant's condition in this period, although the reasons do record that the appellant saw Dr Piirto, Ms Young and Dr Spear in 2012. By the end of 2012, in his study at university for a Bachelor of Arts majoring in classics and ancient history, he had received six high distinctions and a prize in ancient history [28].
A major issue at trial
A major issue at trial was whether the appellant was still suffering in the 'relevant period' from the Depression which he had suffered in mid 2009. Dr Joseph Lee and Dr Helena Piirto, who were consultant psychiatrists, expressed opinions that the appellant suffered Depression in 2009 and was still suffering from that disorder in 2011 (in the case of Dr Lee [131] ‑ [133]) and in 2012 (Dr Piirto [114] ‑ [117]). The other psychiatrist, Dr Spear, on the other hand, was of the opinion that although he suffered Depression in 2009, he recovered [156], and after having the appellant describe his duties when he worked with PWC [171], opined that he was capable of working in his normal role [168]. His diagnosis was that the Depression was 'in remission' [175].
Thus, if the evidence of Dr Lee and Dr Piirto had been accepted by the trial judge, then the appellant would have succeeded in his claim because the disability he suffered in the middle of 2009, which was either a 'sickness' or 'disorder', continued through the 'relevant period'. The trial judge's resolution of this dispute about whether he was still suffering from Depression in the 'relevant period' or whether it was in remission was therefore critical to the appellant's case.
The trial judge's finding on the major issue
In short, the trial judge found that the appellant was not suffering from Depression in the 'relevant period'. The trial judge rejected the evidence of Dr Lee and Dr Piirto that he suffered Depression after mid 2009.
His Honour's findings are found in several paragraphs in his reasons as follows:
(a)the appellant substantially recovered from his 'breakdown in early to mid‑June 2009' [202];
(b)the appellant did not suffer a second episode of Depression in November 2009 [199];
(c)the appellant did not have symptoms in November 2009 or during the 'relevant period' which satisfied the full spectrum of criteria for a formal diagnosis of Depression under DSM‑IV‑TR [226];
(d)when Dr Lee and Dr Piirto saw the appellant, the appellant was not suffering five or more of the listed categories of symptoms required to be present during the same two‑week period [231] (under the DSM‑IV‑TR);
(e)the appellant did not give evidence of symptoms in November or December 2009 which constituted Depression [234];
(f)in the 'relevant period' the 2009 Depression was 'in remission' [235].
None of those findings are challenged.
The plaintiff's symptoms
The trial judge concluded that in the 'relevant period' the appellant had some mild physical and psychiatric symptoms (which his Honour referred to thereafter as 'the plaintiff's symptoms') consisting of, inter alia:
(i)reported difficulty making decisions;
(ii)feeling tired when he met people;
(iii)difficulty remembering telephone numbers and names;
(iv)poor concentration;
(v)minor cognitive difficulties;
(vi)general fatigue and tiredness and feeling under stress with low‑level anxiety;
(vii)a general lack of motivation [236].
Did 'the plaintiff's symptoms' constitute an 'illness' or 'disorder'?
The trial judge held that there was no 'disorder' within the meaning of the policy [261]. The trial judge found that at least some of 'the plaintiff's symptoms' were attributable to his personality type and were therefore not solely the result of any disorder [261]. The trial judge found the appellant was not disabled, irrespective of whether the symptoms could be said to arise either solely or partially out of the mid 2009 bout of Depression.
His Honour concluded at [262] that he was not satisfied that 'the plaintiff's symptoms' during the 'relevant period' constituted an 'illness' as that term was defined in the policy. That finding was the subject of the first ground of appeal which alleges that the trial judge erred in that conclusion. If the first ground of appeal fails, the appeal must be dismissed.
Grounds of appeal
There are five grounds of appeal.
Ground 1
Ground 1 reads:
The learned trial Judge erred in law and fact in concluding that the Plaintiff's symptoms, while the … Policy … was in force, did not constitute an illness within the terms of the Policy.
Because the appellant must succeed on this ground, it is appropriate to deal with it before referring to the other grounds of appeal.
As already mentioned, the appellant had to show that during the relevant period he suffered an 'illness' which was defined as shown above as 'sickness, disease or disorder'. He did not suffer a 'disease'. If he had still been suffering from Depression, he would have suffered a 'sickness' or 'disorder'.
The appellant does not challenge the finding that he was not suffering Depression. However, he contends that he suffered a sickness or disorder because of 'the plaintiff's symptoms' as they were described at [236] of the trial judge's reasons.
The written submissions filed by the appellant read:
The trial Judge found on the evidence that some of the symptoms which the Plaintiff was suffering during the relevant period were attributable to an illness, but that some of them were not. On the basis of the findings that some of the symptoms were not attributable to illness, he concluded that the Plaintiff was not suffering an Illness for the purposes of the Policy. The Policy does not in its terms require that all symptoms of illness which an individual may experience are attributable to illness, in the form of 'sickness, disease or disability', in order to fit the definition of Illness in the Policy. The Trial Judge, therefore, misdirected himself at law as to the proper interpretation of the Policy in that regard and consequently erred in fact in not finding that the Plaintiff suffered an Illness for the purposes of the Policy.
This ground must fail. Even if none of the symptoms were attributable to the appellant's personality, the plaintiff's symptoms in their entirety did not, in ordinary parlance, amount to 'sickness' or to a 'disorder'. This list of 'the plaintiff's symptoms' did not permit a diagnosis of Depression. It amounted to a list of difficulties that many people begin to encounter as they pass middle age. 'The plaintiff's symptoms' explain why some people, as they age, have difficulty operating in a demanding job at the same high level as they did in their early middle age. But that does not mean that a person is suffering a 'sickness' or 'disorder'. The collection of feelings and declining faculties were given a rather elevated description by collectively referring to them as 'symptoms'. A 'symptom' is a phenomenon or circumstance accompanying something and serving as evidence for it. The word is appropriate when talking of an illness. The existence of an illness is often ascertained by reason of symptoms. 'The plaintiff's symptoms' were not symptoms evidencing an illness. They were merely a list of feelings and an awareness of declining faculties. These led the appellant to decide he did not want to continue working [202].
The trial judge did not err when he found 'the plaintiff's symptoms' did not amount to an 'illness', that therefore there was no 'disability' and that therefore there was no entitlement to payments under the policy. For that reason the appeal should be dismissed.
The following reasons for decision are provisional given that the dismissal of ground 1 means that the appeal must be dismissed.
Grounds 2 and 3
The grounds assume success on ground 1. If ground 1 had succeeded, it would then have been necessary for the appellant to show that due to the existence of the illness, and solely as a result of the illness, the appellant was unable to perform at least one income‑producing duty of his occupation. The phrase 'income‑producing duty' was defined as set out at the beginning of these reasons. The onus was on the appellant to show that he was unable to perform at least one income‑producing duty of his 'Occupation' that generates at least 20% of his monthly income. The trial judge said that this had not been proved.
Ground 2 reads:
The learned trial Judge erred in law and fact in concluding that the Plaintiff had not proved that he was unable to perform an Income Producing Duty of his Occupation that generated at least 20% of his Monthly Income.
Ground 3 reads:
The learned trial Judge erred in fact in concluding that the symptoms arising out of the Plaintiff's alleged illness did not prevent him from performing or undertaking at least 20% of his duties.
The issue between the parties was not about a partial ability to perform his duties. The appellant said he was unable to work in his 'Occupation' at all. In other words, he claimed he was prevented from performing 100% of his duties. The respondent said he had completely recovered and could go back to work and perform all of his duties. The trial judge found he had 'substantially recovered' [202] by the end of July 2009 [202] and that 'the plaintiff's symptoms' did not 'prevent him from being able to work' [237] and that his decision not to return to work was 'contrary to the medical advice provided to him' [272]. He was not 'unable' to perform any income producing duties; instead he 'chose' not to continue working at PWC or 'at all' [202]. Those findings followed from the conclusion that the appellant was not suffering from any illness or disorder. No error is revealed.
Once the conclusion was reached that the appellant was not suffering from Depression, he had no basis for contending that he could not work. The conclusion must then be that he could return to work and perform all his duties.
His Honour concluded [279] that he was not persuaded on the evidence that 'most of the duties of the then job of "Director - tax and legal services" are now beyond the capability of the plaintiff'. The submissions to this ground contend that the trial judge's reasons were deficient because they did not 'reveal a path of reasoning towards' this conclusion that 'the plaintiff's symptoms' did not prevent him from performing or undertaking at least 20% of his duties. His Honour's reasons do reveal a path of reasoning. He concluded, as already stated at [279], that he was not persuaded that the duties were beyond the capability of the plaintiff, that he was capable of working during the relevant period, that he merely chose not to work and that he had no illness.
Grounds 2 and 3 must be dismissed.
Grounds 4 and 5
Ground 4 reads:
The learned trial Judge erred in law and fact in interpreting Occupation in clause 12.1 of the Policy as including an employment or activity other than an employment or activity in which the Plaintiff was employed by the Employer named in the Policy.
Ground 5 reads:
The learned trial Judge erred in law and fact in concluding that the Plaintiff could undertake the vocation of an independent tax consultant, having regard to the occupation and duties he performed for PWC without having any regard to what the Plaintiff could reasonably be expected to earn whilst Disabled or Partially Disabled.
To deal with these grounds it is necessary to mention some more facts and provisions of the policy not referred to above.
The respondent defended the case on the basis that the appellant was not 'disabled'. However, to cover the possibility that the court found he was disabled, the respondent invoked cl 12.1 of the policy which reads:
(a)the amount of any income (other than Benefits received under this Policy) and the commutation of income paid or payable in respect of a Covered Person as a result of Disability or Partial Disability including:
(i)any amounts payable under legislation such as workers' compensation or motor accident compensation; or
(ii)any benefits payable under any other disability, Illness or Injury insurance policy (except for lump sum benefits received for total and permanent disablement under such an insurance policy).
(b)the amount of any income we believe the Covered Person could reasonably be expected to earn in his or her Occupation whilst Disabled or Partially Disabled.
The word 'Occupation' was defined in the policy to mean:
[T]he employment or activity in which the person/Covered Person is principally Employed by the Employer.
It is not necessary to refer to the definition of 'Employed'.
Mr McFarlane, the claims manager of the respondent, gave evidence that late in August 2012 he formed the belief on behalf of the respondent that the appellant could reasonably be expected to earn income in his occupation whilst disabled. His belief, on behalf of the respondent, was that the appellant could 'reasonably expect to earn between $75,000 and $200,000 per year' in the occupations identified in reports prepared by
Dr Bowles, an occupational physician, and Ms Coleman, a rehabilitation consultant. Both Dr Bowles and Ms Coleman considered that the appellant could work in a list of various roles. Each witness included work as an 'independent tax consultant' in the list of roles.
The appellant's primary response was that none of the occupations constituted his 'Occupation' as defined in the policy. Various issues were raised in relation to the reports of Dr Bowles and Ms Coleman. All but one issue may be set aside. The only issue in this ground of appeal is about the meaning of the word 'Occupation' as defined. The appellant submitted that it refers to his occupation at PWC, ie, his occupation as a GST tax consultant at PWC. The respondent submitted that the word refers to his occupation in generic terms, that is, his occupation at PWC was as a 'GST tax consultant'.
The trial judge said at [298]:
In my view, the proper interpretation of 'Occupation' involves an objective categorisation or description of the duties undertaken with, if necessary, any degree of specialisation of the employed person. With respect, in my opinion, any other view would not admit commercial sense so far as the plain intention of cl 12.1(b) is concerned, namely, to permit the defendant to reduce the disability benefit payable under the policy if the covered person 'could reasonably be expected to earn'.
I accept the respondent's submission. In my view, the trial judge was correct and he did not err in the view that he expressed at [298].
What cl 12.1 allows for is that if a person was disabled (and therefore not working at PWC), then the respondent might reasonably form the belief that he could work as a 'GST tax consultant'. The definition of 'Occupation' refers to the employment or activity 'in which' he was principally employed by PWC. He was not employed, for example, as a receptionist at PWC. He was employed as a GST tax consultant. That was the employment or activity 'in which' he was principally employed.
The trial judge made no error. All grounds of appeal should be dismissed.
Conclusion
The appeal must be dismissed.
BUSS JA: I agree with McLure P.
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