Fletcher v the LawLink Group Limited - [2021] NZHC 3543

IN THE HIGH COURT OF NEW ZEALAND TAURANGA REGISTRY

I TE KŌTI MATUA O AOTEAROA TAURANGA MOANA ROHE

CIV-2021-470-000071

[2021] NZHC 3543

BETWEEN
DARRYL JOHN FLETCHER

Plaintiff

AND

THE LAWLINK GROUP LIMITED

First Defendant

AND

AMP LIFE LIMITED

Second Defendant

Hearing: 3 November 2021 (by AVL)

Appearances:

T C Gunn for Plaintiff

K S Deobhakta for First Defendant D J Friar for Second Defendant

Judgment:

17 December 2021

JUDGMENT OF ASSOCIATE JUDGE PAULSEN

This judgment was delivered by me on 17 December 2021 at 4.00 pm pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

FLETCHER v THE LAWLINK GROUP LTD [2021] NZHC 3543 [17 December 2021]

[1] The plaintiff (Mr Fletcher) considers AMP Life Ltd (AMP) breached a group income continuance policy when it stopped payment to him of a total disability benefit. Mr Fletcher sues for breach of contract to recover the benefit and general damages. He also pleads against AMP alternative causes of action alleging breach of s 9 of the Fair Trading Act 1986 and negligence.

[2] AMP applies for summary judgment. AMP argues none of Mr Fletcher’s claims can succeed because it had no obligation to continue payment of the benefit when Mr Fletcher breached a condition of the policy to provide evidence necessary to assess his ongoing entitlement.

[3] Counsel for the first defendant, The Lawlink Group Ltd (Lawlink), who Mr Fletcher also sues, attended the hearing to observe.

The background

[4] Mr Fletcher is a former lawyer and partner at Sharp Tudhope Lawyers, Tauranga. That firm was a member of Lawlink. Lawlink carries on business as a network of independent law firms.

[5] In or around February 1988, Lawlink (as Proposer) and National Mutual Life Association of Australasia Ltd (as Insurer) entered into a group income continuance policy of insurance, which in subsequent years was amended several times. It is said the relevant policy wording for present purposes came into force on 1 October 2009 (which I will refer to as “the Policy”).

[6] AMP has assumed responsibility over all claims under or in connection with the Policy from National Mutual.

[7] Certain partners and employees of Lawlink firms qualified to be nominated as Life Insureds and therefore covered under the terms of the Policy. Mr Fletcher was one such person. It appears Mr Fletcher was nominated as a Life Insured by Lawlink in 2008.

[8] The Policy provides personal sickness and accident cover for the benefit of Lawlink. Relevantly, it provides income protection in the event that a Life Insured is totally disabled.

[9] AMP has produced what it says is the policy wording. Relevant terms for present purposes are the following:

(a)Clause 1 of the second schedule provides:

1. Amount of Benefit – Total Disablement

If a Life Insured becomes Totally Disabled while in the Service before the Life Insured’s Benefit Cease Date the Insurer shall pay to the Proposers a Personal Sickness or Accident Benefit the annual amount of which is the Specified Amount less any amounts…

Grounds of appeal

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

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

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

Consideration

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

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

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Details

Case: [2021] NZHC 3543
Decision Date: 17 December 2021

CaseChat Overview and Summary

In the High Court of New Zealand, Darryl John Fletcher sued AMP Life Limited and the Lawlink Group Limited for the cessation of his total disability benefit under a group income continuance policy. The court was required to determine whether AMP had the right to stop payment of the benefit due to Fletcher's refusal to provide certain evidence, and if Fletcher's claims could succeed. The court examined the contractual obligations under the policy, the reasonableness of AMP's requests for evidence, and the consequences of Fletcher's non-compliance.

The court found that AMP's application for summary judgment was inappropriate due to unresolved factual disputes and the need for expert evidence. The court noted that the policy wording was unclear and that there were other relevant documents that had not been produced. Additionally, the court highlighted the necessity of expert evidence to inform the assessment of the parties' obligations under the group policy and the reasonableness of AMP's requests. The court also considered the meaning of clause 15, which required the proposer to provide evidence of qualification or continued qualification for the benefit. The court concluded that while AMP was entitled to require evidence, its requests were not necessarily reasonable, given the context of the policy and Fletcher's condition.

The court ultimately decided that AMP had not demonstrated that none of Fletcher's causes of action could succeed. The court dismissed AMP's application for summary judgment and reserved the decision on costs.

Orders