Cairns v ANZ Banking Group Ltd

Race Discrimination Complaint

1. Mr and Mrs Cairns complaint is set out as follows.
2. Mr and Mrs Cairns are New Zealand citizens residing permanently in Australia since 2004. They entered Australia under the Trans-Tasman Travel Arrangement - the TTTA. They were granted a Special Category Visa - SCV. The SCV is unique to New Zealand citizens and allows them to remain in Australia indefinitely with no work limitation or other conditions attached.
3. In September 2005 Mr Cairns was sent an ANZ Bank (first Respondent) direct marketing letter offering him a life insurance product called Easy Cover Life underwritten by ING Life, now OnePath Life Limited - the policy.
4. The letter stated, amongst other matters:
5. "As an ANZ customer who is a Permanent Australian Resident and aged between 21 and 59, your acceptance is guaranteed."
6. The product disclosure statement (PDS) dated 1 August 2005 set out that the offer was to permanent residents of Australia aged 21 to 59. A definition of 'Permanent Australian Resident' was not provided. In 2005 Mr Cairns took up the policy for both himself and his wife.
7. In March 2015 the Cairns' financial adviser raised concern regarding the wording of their policy. They obtained a copy of the PDS for their policy dated November 2006. In this latter version of November 2006, the wording had changed to define Permanent Resident of Australia as: 'Permanent resident of Australia: an Australian citizen or a person in possession of a Permanent Resident's visa'.
8. The Cairns' financial adviser wrote to OnePath on 28 March 2015 to clarify the matter. On 9 April 2015 the Cairns received a response from OnePath stating that the Cairns "would not be covered from commencement of the policy as they are not citizens or permanent residents of Australia." They were advised that the only option available to them was to cancel the policy from inception and all premiums would be refunded.
9. The Cairns complained of race discrimination in the provision of services against both ANZ and OnePath to the ADB in September 2015.

Responses of Respondents to President of ADB

1. One Path's response to the complaint of 14 December 2015 to the President of the ADB stated that it denied discriminating against the Cairns either directly or indirectly. The letter offering the policy did not say that Mr Cairns had met all the eligibility criteria. Only Mr and Mrs Cairns would have knowledge of their permanent residency status or otherwise. The term "permanent resident of Australia" was not defined in the August 2005 version but was defined in the November 2006 PDS. The policy document dated June 2005 included the following definition of "permanent resident of Australia": "permanent resident of Australia means an Australian citizen or person in possession of a permanent residents visa".
2. OnePath stated that it was clear that the SCVs held by the Cairns were temporary visas not permanent visas. Further the Cairns had the option of becoming permanent residents of Australia and had they done so they would have fulfilled the eligibility criteria for the policy regardless of their New Zealand citizenship. The Cairns had declared in their application that they had received and understood their application. The policy was issued based on the declarations that the Cairns had made in that application.
3. It was the Cairns who had realised that they were not eligible for the policy as they did not hold permanent visas. Even though OnePath denied discriminating on the grounds of race, OnePath refunded all premiums paid for the Easy Cover Life policy which is now closed to new business. OnePath offered to replace the Easy Cover life policy with a Secure Life Plan policy which has additional benefits. As Mr Cairns finds it difficult to obtain new cover due to a stroke that he had suffered since taking out the Easy Cover life policy in 2005, OnePath also stated that it was prepared to waive the five-year pre-existing condition exclusion on the Secure Life Plan Policy for the Cairns, to offset this issue. Mr and Mrs Cairns did not accept this offer.
4. Since 2009 cover has been made available to New Zealand citizens by OnePath regardless of whether or not they are permanent residents of Australia, as long as they received the PDS in Australia. OnePath also says it is in the process of changing its business rules to retrospectively apply the current eligibility criteria to the older policies.

Complaint of Aiding and Abetting against First Respondent ANZ

1. Mr and Mrs Cairns had also made a complaint of aiding and abetting against ANZ Banking Group Ltd on 4 January 2016.
2. The first Respondent ANZ denied that they had aided and abetted race discrimination in that there had been no race discrimination by OnePath. While ANZ Bank may have sent a direct marketing letter to Mr Cairns, the sending of the letter had nothing to do with setting the exclusions in the policy, which if there was any unlawful discrimination, was the only unlawful act.

Acting President's Reasons for Declining the Complaints

1. In her letter of 16 April 2016, the Acting President of the Anti-Discrimination Board summarised the reasons she had determined to decline the complaint in the following way:
2. The parties had agreed that:

• In 2005 the Cairns were offered and took out an Easy Cover life insurance policy;
• In 2015 the Applicants became aware that they might not have been covered by the policy due to one of the eligibility conditions and what was understood at the time to be the definition of permanent Australian resident;
• In response to the Applicants' enquiries regarding this issue, OnePath Life Limited subsequently confirmed that the Cairns would not have been covered from commencement of the policy as they were not citizens or permanent Australian residents.
• OnePath advised the Applicants that their only option was to cancel the policy from inception. All premiums paid by the Cairns were refunded.

Acting President's reasoning

1. At the time the Cairns applied for the policy they were not refused the service (insurance). Whether or not the Applicants would have been refused insurance had they identified at the time as New Zealand nationals residing in Australia under a special category Visa SCV, it cannot be considered as it did not occur.
2. Irrespective of any matters arising from the duty of disclosure in a signed declaration, the terms of service were not afforded on a different basis as the Complainants were not identified as failing to meet the particular requirement.
3. The Applicants have not identified suffering a detriment between 2005 and 2015. Whilst there was "a potential" for detrimental consequences in the event that they had to make a claim on the policy, this did not occur.
4. The Applicants say they were left in the position of being uninsurable as Mr Cairns had a stroke during the period in which he held the subject policy. However it would appear the Respondent then attempted to take appropriate steps to remedy or redress this part of the conduct (discriminatory or otherwise) complained of, when it offered a comparable policy and waiving the five-year pre-existing condition waiting period. This was in addition to having refunded all premiums paid by the Cairns at the time the policy was cancelled.
5. Another factor of note is that the Applicants have resided in Western Australia since 2008. If it is the complainant's argument that the complaint is broader than the selling of the policy in 2005, it is arguable that any events post-2008 may not be covered by the NSW ADA.
6. Given that Mr and Mrs Cairns have failed to demonstrate that they were unlawfully discriminated against by either Respondent, it follows the complaint of aiding and abetting by ANZ Banking Group Limited fails.

Relevant legislation

1. If leave were granted for the complaint of race discrimination to proceed, the burden of proof would be on the applicant to prove his case on the balance of probabilities. The applicant would have to establish that the Respondents breached s 19 of the Act. That section provides: 19 Provision of goods and services It is unlawful for a person who provides (whether or not for payment) goods or services to discriminate against another person on the ground of race: (a) by refusing to provide the person with those goods or services, or (b) in the terms on which the other person is provided with those goods or services.
2. Race discrimination is defined in s 7 of the Act: 7 What constitutes discrimination on the ground of race (1) A person ("the perpetrator") discriminates against another person ("the aggrieved person") on the ground of race if the perpetrator: (a) on the ground of the aggrieved person's race or the race of a relative or associate of the aggrieved person, treats the aggrieved person less favourably than in the same circumstances, or in circumstances which are not materially different, the perpetrator treats or would treat a person of a different race or who has such a relative or associate of a different race, or (b) on the ground of the aggrieved person's race or the race of a relative or associate of the aggrieved person, segregates the aggrieved person from persons of a different race or from persons who have such a relative or associate of a different race, or (c) requires the aggrieved person to comply with a requirement or condition with which a substantially higher proportion of persons not of that race, or who have a relative or associate not of that race, comply or are able to comply, being a requirement which is not reasonable having regard to the circumstances of the case and with which the aggrieved person does not or is not able to comply.

Direct Race discrimination section 7(1) (a) and (b)

1. In order to substantiate a complaint of direct race discrimination, the applicants would need to prove: 1. that the applicants were treated less favourably than a hypothetical or actual persons who were of a different race to the applicants (the comparator); 2. that the less favourable treatment was on the ground of the applicants' race (causation); and 3. that the Respondents' conduct falls into one or more paragraphs in s 19.
2. That is, the Applicants would have to prove that they were refused a service or they were treated less favourably in the terms on which they were provided with the service.
3. When considering causation, s 4A of the Act is to be borne in mind. That section provides: 4A Act done because of unlawful discrimination and for other reasons If: (a) an act is done for 2 or more reasons, and (b) one of the reasons consists of unlawful discrimination under this Act against a person (whether or not it is the dominant or a substantial reason for doing the act), then, for the purposes of this Act, the act is taken to be done for that reason.

Complaint of Aiding and Abetting against ANZ Banking Group Limited

1. Section 52 of the Act makes it unlawful to aid or abet another in the doing of an act that is unlawful. 52 Aiding and abetting etc. It is unlawful for a person to cause, instruct, induce, aid or permit another person to do an act that is unlawful by reason of a provision of this Act.
2. The Tribunal accepts that a cautious approach should be adopted to a refusal of leave, bearing "in mind that refusal of such leave will finally determine the rights of the parties under this legislative scheme, which is dealing with important human rights": Ekermawi v Administrative Decisions Tribunal of New South Wales [2009] NSWSC 143 at [32].

The Applicants' submissions

1. The Applicants made both written and oral submissions. The Tribunal summarises them as follows.
2. The Acting President of the ADB had been incorrect in stating that the applicants had not been refused a service. The applicants had been issued with a policy which did not cover them and the respondent OnePath had confirmed that the applicants were never covered by the policy. The applicant asserted the fact that they had never sought to claim and had not been refused was not relevant.
3. Effectively the applicants had never received the service for which they had paid for the period 2005 to 2015. This service was to be covered by the policy of insurance.
4. The Acting President had noted that some parts of the complaint had occurred after the Applicants had moved to Western Australia in 2008. The applicants should be permitted to argue whether or not they remained covered by the New South Wales ADA after this time. This was not a basis on which the Acting President should have declined the complaint as it was an arguable issue.
5. ANZ's argument that it did not provide any services in relation to the insurance policy was flawed. The definition of services in section 4 of the Act specifically refers to services relating to insurance. ANZ had provided a direct marketing service to link customers with the provision of life insurance. In this respect they were providing a service relating to life insurance.
6. The policy document had not been sent to the Cairns after until after the decision to purchase the life insurance policy. They were not advised of conditions and exclusions until after their purchase. Further, as customers of ANZ they had provided ANZ with all their details when opening bank accounts The ANZ would have been aware of the Cairns' visa status.
7. The Respondents' motive in excluding New Zealand applicants from coverage was irrelevant. The fact that the Cairns had been offered a replacement policy did not change the fact that they were not covered by the original policy that they had wanted to be covered by. That still remained discriminatory.
8. The applicants argued that however one looked at the issue, the problem at all times came back to the Cairns' New Zealand citizenship - whether OnePath was motivated by a discriminatory attitude towards New Zealanders or not.

The Respondents' submissions

1. The Respondents made written and oral submissions at the hearing. The Tribunal summarises these as follows.
2. The Respondents contended that it would not be fair and just for the Complainants to be given leave to proceed.
3. OnePath had provided the Complainants with the policy on the basis of their representation that they were Permanent Australian Residents. Once the error was discovered on the Complainants' application, the policy was cancelled. An apology was issued and the premia were refunded. The Complainants were offered a new policy with more favourable terms which also waived the five-year waiting period for a pre-existing condition. The Complainants had unreasonably rejected this offer. On this basis leave should be refused.
4. The Respondents denied that the Complainants had been refused insurance services. The Complainants had rejected a settlement offer because of their concern for other New Zealand citizens. They sought various amendments to the 2005 policy for other New Zealanders. This remedy was futile as any such problems had already been resolved.

Lack of Merit

1. The Respondents contended that the complaint lacks merit. A lack of merit is a relevant consideration as to whether or not it is fair and just for leave to be granted for the complaint to proceed.
2. The 2005 policy was not concerned with the nationality of the holder - it was concerned with visa status. There had been no differential treatment under section 7 of the Act (the prohibition against race discrimination). The Complainants had not been refused coverage of a policy and they were never refused any benefits. The complaint could not succeed as a characteristics complaint, as the lack of a permanent residency visa was not a characteristic of New Zealand citizenship.
3. The complaint could not be formulated as an indirect race discrimination complaint. The Complainants could have complied with any requirement to have a permanent residency visa - they had elected not to. The requirement or condition to have a permanent residency visa was reasonable because OnePath did not issue financial products outside Australia and life insurance policies are likely to last for long periods of time.
4. In relation to the complaint of aiding and abetting against ANZ, the only action ANZ had taken was to issue a letter. They were not a party to a contract between the Complainants and the insurer. Further, aiding and abetting requires knowledge and intention on the part of the alleged aider and abetter and there was no such knowledge and intention demonstrated in the ANZ. For these reasons, leave should be declined for the complaint to proceed.

Consideration

1. In order to substantiate a complaint of direct race discrimination under sections 7(1) (a) and (b) an 19, the Applicants would have to prove that; 1. they are members of a particular race; 2. the Respondents treated them less favourably by refusing to provide them with services, or less favourably in the terms on which they were provided with those services. 3. in doing so, the Respondents treated them less favourably than they treated or would have treated persons of a different race; (differential treatment) 4. at least one of the reasons for that treatment was the Applicants' race (causation).

Race

1. "Race" is defined in s 4 of the Anti-Discrimination Act to include: "colour, nationality, descent and ethnic, ethno-religious or national origin." It is not in dispute that Mr and Mrs Cairns' national origin is New Zealander.
2. The two elements which must be proved to substantiate a complaint of direct discrimination are "differential treatment" and "causation": Commissioner of Corrective Services v Aldridge [2000] NSWADTAP 5. The treatment afforded to the Complainants must be compared to the treatment that was or would have been afforded to a real or hypothetical person of a different race in the same circumstances or in circumstances which are not materially different.
3. In addition, race must be at least one of the reasons for the treatment: Anti-Discrimination Act, s 4A. The question a Tribunal should ask when addressing the causation element of direct discrimination is whether the person's race is at least one of the 'real', 'genuine' or 'true' reasons for the treatment: Purvis v State of New South Wales [2003] HCA 62; (2003) 217 CLR 92 per Gleeson CJ at 102, McHugh and Kirby JJ at 144. Depending on the circumstances, the motive and purpose of the alleged discriminator, as well as the effect on the aggrieved person, may all be relevant. As with the vast majority of complaints of discrimination, a causal link between the Applicants' race and the alleged treatment would have to be established by inference from primary facts: Seltsam Pty Ltd v McGuiness [2000] NSWCA 29; (2000) 49 NSWLR 262. The following principles identified in Dutt v Central Coast Area Health Service [2002] NSWADT 133 at [70] are relevant: "... (b) an inference must be reasonably drawn on the basis of the primary facts; (c) an inference can be drawn from a combination of facts, none of which viewed alone would support that inference; (d) a fact relied on as the basis of an inference need not be proved to the requisite standard of proof; it is not enough that the inference is a mere possibility: it must be one of "probable connection"; (e) the inference must be a logical one, and not supposition; (f) an inference cannot be made where more probable and innocent explanations are available on the evidence."

Differential treatment

1. There is no reference in the President's Report to a person who could serve as an actual comparator. The Tribunal would have to imagine a hypothetical person who was not of New Zealand national origin, and identify the circumstances to be taken into account when comparing how the Respondents treated the Applicants and how it would have treated such a hypothetical person.
2. The Tribunal considers that it is arguable that the Cairns' situation as a holder of an SCV was that they effectively had the same right to remain in Australia (as permanent residents) as a holder of a formal Permanent Resident visa had. Their circumstances were not materially different from those of the holder of a formal Permanent Residents visa. However the Cairns' SCV, unique to a New Zealander, was treated differently to a Permanent Resident visa. The Tribunal considers that this presents an arguable case that the causation for the less favourable treatment was the Cairns' New Zealand citizenship.

Was a service refused?

1. In declining the complaint the Acting President of the Anti-Discrimination Board stated that the applicants had not been refused a service as they had not sought to claim against the policy. The Tribunal respectfully disagrees with the Acting President's view. The second respondent had conceded that the Complainants were never covered by the policy from the beginning - even though their application for the policy and their premium payments were accepted. An insurance service includes the capacity to claim against a policy as necessary. The Complainants never had this capacity. The Tribunal considers that there is an arguable case that the Applicants were refused service in that they were told they would not have been able to claim against their policy.

Detriment?

1. The Tribunal would have to consider whether the consequential conduct amounts to a 'detriment.'
2. The Tribunal is satisfied the Applicants entered into a policy understanding that should an event occur, that they would have the capacity to claim in relation to the event. The Tribunal's understanding is that despite being issued with a policy and paying the requisite premia, the applicants would never have been able to claim against the insurance policy. This again is arguably a detriment to the applicants.

Causation?

1. The Applicants stressed that the letter from ANZ said: "As an ANZ customer who is a permanent Australian resident and aged between 21 and 59, your acceptance is guaranteed."
2. It is arguable in the Tribunal's view that these words could have meant "as a person who is entitled to reside in Australia permanently" and not "as a holder of a formal Permanent Resident Visa."
3. The Tribunal accepts that it is not necessary to show that the Respondents intended to discriminate against New Zealand applicants from coverage.
4. The Applicants argued that however one looked at the issue, the problem at all times came back to the Cairns' New Zealand citizenship - whether OnePath was motivated by a discriminatory attitude towards New Zealanders or not. The Cairns' SCV, unique to a New Zealander, was treated differently to a Permanent Resident visa. The Tribunal considers that this presents an arguable case that the causation for the less favourable treatment was the Cairns' New Zealand citizenship.

Argument for an indirect race discrimination complaint

1. To establish a complaint of indirect race discrimination the Applicants would need to establish that the Respondents:

• required the Applicants to comply with a requirement or condition;
• with which a substantially higher proportion of persons not of the New Zealand race, comply or are able to comply,
• being a requirement which is not reasonable having regard to the circumstances of the case; and
• with which the aggrieved person does not or is not able to comply.

1. The Tribunal considers that it is arguable that OnePath Life Limited required the Applicants to comply with a requirement that they have a formal permanent resident status visa while living in Australia in order to be able to claim upon their insurance policy.
2. No proportions of complying population were provided to the Tribunal. However it would be a matter for evidence to show that is substantially higher proportion of non-New Zealanders who are residing permanently in Australia have a formal permanent resident status.
3. It is arguable that the requirement for a formal permanent resident designation as opposed to an SCV would be considered unreasonable in the circumstances. Both statuses allow the person concerned to reside permanently in Australia. It is clear that the Applicants do not comply with the requirement that they have a formal permanent resident status. The Respondents argued that the Applicants could have applied for this, in addition to their SCV. The Tribunal notes however that the Second Respondent contended that the Applicants were never covered by the policy from the beginning. It would appear that the lack of a permanent resident status visa could not be repaired once the policy was taken out in 2005.

Merits of Complaint of Aiding and Abetting against ANZ Banking Group Limited

1. The Tribunal is satisfied that there is an arguable case that ANZ aided OnePath in their interactions with the Cairns. These interactions were arguably discriminatory. The letter from ANZ to the Cairns undertakes that the Cairns' Australian residency meets criteria for the policy. Without the ANZ's identification of the Cairns' residency status, in circumstances where the ANZ would arguably have been aware of the Cairns' New Zealand citizenship, the balance of the "res gestae" would not have proceeded. The ANZ stated in their letter that the Cairns' acceptance was guaranteed.
2. The ANZ was closely associated with the offer and acceptance of the policy. Applicant's rejection of settlement offer
3. The Tribunal has considered the Acting President's declination of the complaint because the Applicants had not accepted an offer of settlement.
4. The remedies upon a finding of discrimination are set out in section 108 of the Act:

Section 108 (2) If the Tribunal finds the complaint substantiated in whole or in part, it may do any one or more of the following: (a) except in respect of a matter referred to the Tribunal under section 95 (2), order the respondent to pay the complainant damages not exceeding $100,000 by way of compensation for any loss or damage suffered by reason of the respondent's conduct, (c) except in respect of a representative complaint or a matter referred to the Tribunal under section 95 (2), order the respondent to perform any reasonable act or course of conduct to redress any loss or damage suffered by the complainant, (d) order the respondent to publish an apology or a retraction (or both) in respect of the matter the subject of the complaint and, as part of the order, give directions concerning the time, form, extent and manner of publication of the apology or retraction (or both), (e) in respect of a vilification complaint, order the respondent to develop and implement a program or policy aimed at eliminating unlawful discrimination, (f) make an order declaring void in whole or in part and either ab initio or from such time as is specified in the order any contract or agreement made in contravention of this Act or the regulations, (g) decline to take any further action in the matter. (3) An order of the Tribunal may extend to conduct of the respondent that affects persons other than the complainant or Complainants if the Tribunal, having regard to the circumstances of the case, considers that such an extension is appropriate. (4) The power of the Tribunal to award damages to a complainant is taken, in the case of a complaint lodged by a representative body, to be a power to award damages to the person or persons on behalf of whom the complaint is made and not to include a power to award damages to the representative body. (5) In making an order for damages concerning a complaint made on behalf of a person or persons, the Tribunal may make such order as it thinks fit as to the application of those damages for the benefit of the person or persons. (6) ………..

1. It is clear that there are a range of potential outcomes for a successful complaint foreseen under the Act.
2. The Tribunal respectfully disagrees with the Acting President of the ADB that the fact of a settlement offer has been made to the Applicants renders it unfair or unjust for leave for the complaint to proceed. The Applicants may, if their complaint is successful at hearing, seek remedies other than those offered in settlement. Further the fact that a complaint may or could be settled does not detract from any inherent merit the complaint may have.

Is it fair and just for the complaints to proceed?

1. The issue to be determined is whether it is fair and just in all the circumstances for the complaints to proceed. See Ekermawi v Administrative Decisions Tribunal of New South Wales [2009] NSWSC 143 at [28] - [38]
2. As set out, the Tribunal needs to approach the decision of whether or not to grant leave cautiously as it is dealing with important human rights. The Tribunal considers that there is at least an arguable case of race discrimination in the area of services on the grounds of the Cairns' nationality.
3. Similarly the Tribunal considers there is an arguable case that the First respondent has aided and abetted that discrimination by assisting in the offer of insurance services.
4. It is by no means certain that the Applicants will succeed in substantiating their complaints. However it cannot be said that the complaints lack substance. In the Tribunal's view, it is fair and just in all the circumstances for the complaints to proceed.

Orders

1. Leave is granted for the Applicants' complaints to proceed. I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 25 July 2016