Celik v NRMA

THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

JUDGMENT 1 HIS HONOUR: This is an appeal by Hasan Celik and his wife Hasreat Celik pursuant to s69(2) of the Local Courts (Civil Claims) Act from a judgment of a magistrate given on 18 August 1999 in proceedings in the Local Court, which had been brought by Mr and Mrs Celik against NRMA Insurance Limited ("NRMA Insurance") on a policy of insurance issued by NRMA Insurance to Mr and Mrs Celik. In the proceedings in the Local Court the magistrate gave judgment for the defendant NRMA Insurance in the action brought by Mr and Mrs Celik and also gave judgment for NRMA Insurance on a cross-claim which it had brought against Mr and Mrs Celik for the recovery of amounts previously paid to them by NRMA Insurance pursuant to the policy of insurance. 2 The appeal is governed by the new Pt 51B of the Supreme Court Rules. An affidavit by a solicitor was filed, to which were exhibited a copy of the transcript of the proceedings in the Local Court and a copy of the magistrate's judgment of 18 August 1999. On the hearing of the appeal a number of documents which had been exhibits in the proceedings in the Local Court were admitted into evidence. 3 There was no dispute, either in the Local Court or on the appeal, about any of the following facts. In June 1995 Mr and Mrs Celik acquired a Toyota motor vehicle. On 27 June 1995 NRMA Insurance issued a policy of comprehensive motor vehicle insurance on the vehicle. Temporary cover under the policy commenced on 27 June 1995. Conditionally upon the cost of the policy being paid by 18 July 1995 (an event which happened), the term of the policy of insurance was twelve months from 27 June 1995. The policy of insurance was renewed in June 1996 and June 1997. At various times NRMA Insurance paid to Mr and Mrs Celik amounts totalling $10,290 pursuant to the policy. On 28 August 1997 the vehicle was involved in an accident and was damaged beyond repair. Mr and Mrs Celik then made a claim on the policy. NRMA Insurance refused the claim, on the grounds that there had been a failure to disclose driving offences and traffic infringements by Mr Celik in the period of five years preceding the issue of the policy and that there had been a further failure to disclose further driving offences and traffic infringements by him before renewals of the policy. Mr and Mrs Celik disputed that NRMA Insurance was entitled to refuse the claim and brought the proceedings in the Local Court to enforce the claim. NRMA Insurance brought a cross-claim to recover the amounts which it had previously paid pursuant to the policy. 4 There was no dispute that, within the period commencing five years before 27 June 1995 and expiring on the date of the second renewal of the policy, Mr Celik had committed a number of traffic offences. In particular, in Burwood Local Court on 15 December 1994 he had been convicted of driving on 22 November 1994 with a middle range prescribed concentration of alcohol in his blood and had been disqualified from driving for five months from 15 December 1994 and in Newtown Local Court on 11 August 1995 he had been convicted of driving whilst disqualified on 7 April 1995 and had been disqualified from driving for six months from 11 August 1995. 5 The magistrate said in her judgment, "the main factual issue of this case concerns the taking out of the insurance". On this issue there was a conflict between the evidence of Mr Celik (supported to some extent by the evidence of Mrs Celik) and the evidence of witnesses called by NRMA Insurance. 6 Mr Celik's version, as summarised by the magistrate in her judgment, was that on 9 June 1995 Mr and Mrs Celik had gone to the premises of a car dealer, Western Toyota, and had selected a vehicle for purchase. Mr Celik had then told the manager of Western Toyota, Mr Spiteri, to arrange the financing and insuring of the vehicle. He had said to Mr Spiteri, "when I come back, I only want to pick up the car". Mr Celik told Mr Spiteri that he had lost his licence because of drink driving and that was why the vehicle was being bought in his wife's name, as well as his own. 7 On 27 June 1995 Mr Celik collected the vehicle from Western Toyota. By that time Mr Spiteri had arranged everything, including insurance on the vehicle. Mr Celik had played no part in obtaining the insurance. 8 The version which was supported by the evidence of witnesses called by NRMA Insurance, and particularly by the evidence of a Ms Fuller who in June 1995 was an employee of NRMA Insurance working at its Auburn branch, was that on 27 June 1995 Mr Celik had personally attended at NRMA Insurance's Auburn branch and had himself applied for insurance on the vehicle he and his wife were purchasing. 9 At the time of giving her evidence in the Local Court Ms Fuller had no actual recollection of the circumstances in which the policy of insurance on Mr and Mrs Celiks' vehicle had been taken out. Her evidence was based on certain records of NRMA Insurance, on some of which her payroll number 2708 (which was her personal identification number as an employee of NRMA Insurance) appeared and on what she said was the usual practice in June 1995 in the Auburn office. 10 Ms Fuller gave evidence that in June 1995 a person applying to NRMA Insurance at its Auburn office for comprehensive motor vehicle insurance was not required to complete a paper proposal form. The procedure used at the Auburn office, when someone applied at the Auburn office for motor vehicle insurance, was as follows. An employee of NRMA Insurance such as Ms Fuller would bring up on the screen of her computer terminal a "prompt", that is a series of questions to be asked of an applicant for insurance. She gave the following further evidence:- Q. And rather than the insured read the questions on a proposal form you would read them off the screen to the insured, is that right? A. That's correct. Q. And then as the insured responded to the questions you would type in the answers directly into the computer? A. That's correct". 11 The questions in the prompt included "over the last five years has any owner or driver had insurance (1) refused (2) cancelled (3) avoided or (4) renewal not offered (5) any claim refused or (6) special conditions imposed?" and "in the last five years has any owner or driver had any driving offences or traffic infringements?" 12 Ms Fuller identified a computer generated document called "confirmation of details" relating to the insurance of the vehicle being purchased by Mr and Mrs Celik (which became exhibit 3 in the proceedings in the Local Court) as a document created by her by typing the answers she had received to questions asked by her in accordance with the prompt. Ms Fuller's payroll number written in her own handwriting appeared on a print out of this confirmation of details. 13 The confirmation of details included the following:- "Driver history for the past 5 years Mr H Celik - Date of birth 28/02/61 - Years driving 10 - In the last 5 years this driver has had no insurance refused - No insurance cancelled - No insurance avoided - No insurance renewal not offered - No claims refused - No special conditions imposed - Accidents and incidents - At fault in an accident-other vehicle involved 19/01/91 Cost $0 - Offences - No driving offences or traffic infringements". 14 Ms Fuller gave evidence that, according to the usual practice, a copy of a print out of the confirmation of details would have been given to the person applying for insurance, to take away with him. 15 Ms Fuller also gave some evidence which was based on an entry in an NRMA Insurance internal record, reading:-

"27/6/95 RTA listing required by 18/07/95 - 2708 AUB (URN)" 16 On the basis of this entry, Ms Fuller gave evidence that she would have asked the applicant for insurance to provide, by 18 July 1995, an RTA listing, that is a document from the Roads and Traffic Authority setting out "offences, suspensions or cancellations of licences" for the person applying for insurance. 17 No such RTA listing was provided by Mr Celik by 18 July 1995 or at any time before the accident on 28 August 1997. However, when payment was made for the policy on 6 July 1995 at another branch of NRMA Insurance, inferentially by a finance company posting the payment to that branch, the policy was "receipted", without anyone at that other branch becoming aware of the outstanding requirement that Mr Celik provide a RTA listing. 18 Mr Spiteri, the manager of Western Toyota, also gave evidence for NRMA Insurance. With regard to his evidence, the magistrate said in her judgment:- "Mr Spiteri said he had no specific memory of the event and that he had on occasions rung an insurance company to arrange insurance for a purchaser. However, he knew no-one at the Auburn branch and had never to his memory dealt with that branch. It was not the closest NRMA branch to Western Toyota. He said that when he did so ring for insurance he did so only with the customer present, so that the customer could answer the relevant questions. Moreover, Exhibit 3 contained mistakes that he would not have made, in that it nominated the wrong finance company and misstated the purchase price of the vehicle. Further, it contained information that he did not have". 19 In her judgment the magistrate made a finding, contrary to Mr and Mrs Celiks' evidence, that "I am satisfied that Mr Celik attended the NRMA Auburn branch and himself requested the preparation of Exhibit 3". 20 After making this finding the magistrate continued her judgment by saying:- "Even if this is the case, the Plaintiffs say the Defendant has waived compliance with the duty of disclosure by issuing the Policy despite the Plaintiffs' failure to provide the requested RTA listing. The Defendant's evidence shows that the Policy was receipted at the Chatswood branch of the NRMA inferentially by the finance company posting the confirmation and the premium to that branch. The computer program for receipting did not then show the request for the RTA listing and the Policy was issued. In these circumstances the Plaintiffs say the Defendant's action amount to a deemed waiver as provided by s21 ss3 of the Insurance Contracts Act . In answer to this the Defendant argues that Exhibit 3 contains, on its face, no obviously incomplete or irrelevant answer… to… waiver. I accept that this is so that the Plaintiffs say that in requesting a listing Ms Fuller demonstrated that she had been put on notice of the answers given by Mr Celik were incomplete. It seems to me that, if I accept Ms Fuller's evidence as I do, I must accept the clear and unequivocal statement that she would not have produced the confirmation, had Mr Celik informed her of his convictions of the PCA or driver disqualified. The Plaintiffs are critical of the fact that Ms Fuller did not give evidence of her request for further information in evidence in chief. It was revealed in her cross examination. However, Ms Fuller volunteered this information in cross and appeared eager to give it. Her failure to reveal in chief the existence of the notation does not in my view affect the reliability of her evidence that, had she been given notice of these serious offences, she would not have produced Exhibit 3. I am satisfied that, whatever it was that alerted Ms Fuller to the need for an RTA listing, it was not notice of Mr Celik's serious driving offences. I am also satisfied that some notice of the existence of these offences is necessary before the Defendant can be said to have waived the duty to disclose and I refer to Devine v Sun Alliance Australia Ltd, which is an unreported NSW Supreme Court judgment of Justice Giles on 18th of June 1992. It follows that I am not satisfied that the Defendant waived the duty to disclose". 21 It is obvious that part of the second paragraph of the extract from the magistrate's judgment which I have just quoted has not been accurately transcribed. I suggested to counsel, and neither counsel demurred to my suggestion, that the second, third and fourth sentences in the second paragraph of this extract should read as follows:- In answer to this the defendant argues that exhibit 3 contains, on its face, no obviously incomplete or irrelevant answer (so as) to (amount to a) waiver. I accept that this is so. The plaintiffs say that in requesting a listing Ms Fuller demonstrated that she had been put on notice that the answers given by Mr Celik were incomplete". 22 I consider that in the extract from the magistrate's judgment set out in paragraph 20 of this judgment, the magistrate expressly made at least the following findings of fact:-

(i) The confirmation of details (Exhibit 3) did not contain any obviously incomplete or irrelevant answer.

(ii) Mr Celik did not inform Ms Fuller of his driving offences. 23 The magistrate's judgment then continued as follows:- "As far as the Plaintiffs' personal circumstances are concerned, it is clear that both have limited command of English. I accept Ms Barrier's report of Mr Celik's ability and I am satisfied that he, unaided, would be unable properly to read and comprehend Exhibit 3 and the renewals of the Policy sent to him in 1996 and 1997. But I also note that he is aware of the importance of accuracy when he signs a document and that he was frank in his evidence in acknowledging the importance to any insurer of information about his disqualifications and offences. I am satisfied that, despite his limited English, he was well aware of the duty he owed to the Defendant to disclose his full driving history. I am also satisfied that he did not do so. As noted above, I do not accept that Joe Spiteri obtained insurance cover, Mr Celik did himself and, despite his acknowledgment of the importance of those convictions to an insurer, he failed to reveal them to Ms Fuller. This cannot be explained away by poor English. I do not accept his English is so bad that he could not understand the question and give the information he himself knows is so important. Indeed, in his version of the events, he asserts that he informed Mr Spiteri in English of his driving conviction. It is clear that Mr Celik failed to disclose his driving history when he applied for insurance. I am satisfied that he did so knowingly and that he answered the relevant question, without belief in the truth of his answer. It follows therefore that on the test set out in Derry v Peek 1989 Court of Appeal Cases at 373 and 374, the failure to disclose is fraudulent and the Defendant is entitled to avoid the Policy". 24 The reference to Derry v Peek was clearly intended by the magistrate to be a reference to Derry v Peek (1889) 14 App Cas 337. 25 I consider that in this part of her judgment the magistrate made at least the following findings of fact:-

(i) Mr Celik, notwithstanding his limited command of English, understood that he had a duty to disclose his driving record to Ms Fuller.

(ii) Mr Celik did not disclose his driving record to Ms Fuller.

(iii) When asked a question about his driving record in accordance with the prompt, Mr Celik gave an answer which did not disclose his driving record and I infer that the magistrate was satisfied that Mr Celik gave an answer to the effect that he had had no driving offences or traffic infringements in the last five years.

(iv) Mr Celik gave his answer to the question about his driving record, knowing that his answer was untrue or at least without any belief that it was true. 26 I now turn to the grounds of appeal which were argued on the hearing of the appeal.

The magistrate erred in finding that the defendant (NRMA Insurance) did not waive the requirement for disclosure of Mr Celik's previous driving record, in circumstances where he had failed to answer or had given an obviously incomplete or irrelevant answer to a question in the proposal form, pursuant to s21(3) of the Insurance Contracts Act . 27 Section 21 of the Insurance Contracts Act is in the following terms:- " 21 The insured's duty of disclosure (1) Subject to this Act, an insured has a duty to disclose to the insurer before the relevant contract of insurance is entered into, every matter that is known to the insured, being a matter that: (a) the insured knows to be a matter relevant to the decision of the insurer whether to accept the risk and, if so, on what terms: or (b) a reasonable person in the circumstances could be expected to know to be a matter so relevant. (2) The duty of disclosure does not require the disclosure of a matter: (a) that diminishes the risk; (b) that is of common knowledge; (c) that the insurer knows or in the ordinary course of the insurer's business as an insurer ought to know; or (d) as to which compliance with the duty of disclosure is waived by the insurer. (3) Where a person: (a) failed to answer; or (b) gave an obviously incomplete or irrelevant answer to: a question included in a proposal form about a matter, the insurer shall be deemed to have waived compliance with the duty of disclosure in relation to the matter". 28 It can be seen that the conditions for the application of s21(3) are that a person applying for insurance failed to answer or gave an obviously incomplete or irrelevant answer to a question included in the proposal form about some matter. 29 An initial question is whether in the present case there was any "proposal form" within the meaning of that expression in s21(3). 30 As already stated by me, there was no paper proposal form of the usual kind, containing questions which the person applying for insurance was asked to answer. There were, however, the "prompt" and the "confirmation of details". Ms Fuller gave evidence that "this document (that is, the confirmation of details) was made to cut out the proposal side of things. To reduce paper work" and the magistrate in her judgment said that "the confirmation of details… takes the place of the proposal for insurance". 31 In s11 of the Insurance Contracts Act "proposal form" is defined as including "a document containing questions to which a person is asked to give answers (whether in the document or not) where the answers are intended… to be used in connection with a proposed contract of insurance". In s25 of the Acts Interpretation Act the word "document" is given an extended meaning as including any material from which writings are capable of being reproduced. 32 On the hearing of the appeal counsel for Mr and Mrs Celik naturally submitted that in the present case there was a "proposal form". Counsel for NRMA Insurance did not abandon, but did not really press, a submission that there was no proposal form. Counsel for NRMA Insurance accepted that it could be the position that a proposal form could be found in a combination of, or in one or other of, the prompt and the confirmation of details. 33 The magistrate clearly accepted that there was a proposal form and I consider that I should proceed on that basis. However, having regard to the definition of "proposal form" in s11 of the Act, it may be that, even allowing for the fact that the definition in s11 is only an inclusive definition, it is the document containing the questions, that is the prompt, rather than the document containing the answers, that is the confirmation of details, which should be identified as being the proposal form. However, for the purpose of addressing some submissions made by counsel for Mr and Mrs Celik, I am prepared to accept that the confirmation of details formed part of a "proposal form". 34 If it is accepted that there was a proposal form, it is next necessary to enquire whether Mr Celik failed to answer or gave an obviously incomplete or irrelevant answer to a question in the proposal form. The relevant question in the proposal form would have been a question to the effect of whether in the last five years Mr Celik had had any driving offences or traffic infringements. 35 The evidence which was relevant to this issue and which was accepted by the magistrate, was limited. The magistrate completely rejected Mr Celik's account of how the contract of insurance was taken out. Ms Fuller had no actual recollection of what had happened when the contract of insurance was taken out. The only evidence which was relevant to the issue and accepted by the magistrate consisted of the contents of the documents and Ms Fuller's evidence about the usual practice of NRMA Insurance. 36 The words in the confirmation of details "Driver history for the last 5 years… no driving offences or traffic infringements", which were, inferentially, an answer to a question asked in accordance with the question in the prompt, "in the last 5 years has any owner or driver had any driving offences or traffic infringements", do not indicate a failure to answer or an obviously incomplete answer or an irrelevant answer to the question. The magistrate in her judgment accepted that the confirmation of details on its face did not contain any obviously incomplete or irrelevant answer. 37 However, it was submitted on behalf of the appellants that it should have been inferred, from Ms Fuller's requiring that Mr Celik provide an RTA listing by 18 July 1995, that Mr Celik had failed to answer or had given an obviously incomplete answer to a question about his driving record. 38 Counsel for Mr and Mrs Celik, who had also appeared for them in the Local Court, asserted that the same submission had been made to the magistrate at the Local Court hearing. However, it was said that the magistrate in her judgment had incorrectly stated the submission made to her as being that "the plaintiffs say that in requesting a listing Ms Fuller demonstrated that she had been put on notice (that) the answers given by Mr Celik were incomplete", whereas the submission which had been made to the magistrate was simply that it could be inferred from Ms Fuller's requesting an RTA listing that Mr Celik had failed to answer or had given an incomplete answer to a question asked by Ms Fuller about his driving record. 39 It was further submitted that the magistrate's reference in her judgment to the decision of Giles J in Devine v Sun Alliance Australia Limited (unreported 18 June 1992) was inapposite . Devine v Sun Alliance was a case in which there was a written proposal form of the usual kind, in which Mr Devine, who was the person applying for insurance, had answered certain questions. So far as waiver of the insured's duty of disclosure was concerned, Devine v Sun Alliance depended on s21(2)(d) of the Insurance Contracts Act, and not s21(3). The issue in Devine v Sun Alliance (on the subject of waiver) was whether, by writing a letter to the insurer, Mr Devine had put the insurer on notice of matters which were not disclosed in his answers to the questions in the proposal form, with the consequence that there had been a waiver by the insurer within s21(2)(d) of the Insurance Contracts Act. 40 It was further submitted by counsel for the appellants that the reference by the magistrate to Devine v Sun Alliance had led the magistrate erroneously to conclude that in the present case some notice on the part of NRMA Insurance of the matters not disclosed was necessary, before NRMA Insurance could be said to have waived the duty of disclosure. It was submitted that, unlike waiver under the general law, a deemed waiver under s21(3) occurs, whenever an applicant for insurance fails to answer or gives an obviously incomplete or irrelevant answer to a question in a proposal form about a matter, regardless of whether the insurer has any notice of the matter. 41 If the references by the magistrate to Devine v Sun Alliance were made by her in the context of considering a submission made on behalf of Mr and Mrs Celik, that there had been a deemed waiver under s21(3) of the Insurance Contracts Act, then the criticisms made by counsel for the appellants which I have summarised in the last two paragraphs, would be justified. However, it may be that in this part of her judgment the magistrate was considering whether there had been a waiver under the general law, independently of s21(3), in which case her references to Devine v Sun Alliance would have been appropriate. 42 Whether or not the criticisms made by counsel for the appellants of the magistrate's references to Devine v Sun Alliance are justified, it is necessary to focus on the submission made on behalf of the appellants, which is critical to the first ground of appeal, that it should have been inferred from Ms Fuller requiring Mr Celik to provide an RTA listing by 18 July 1995, that Mr Celik had failed to answer or had given an incomplete answer to a question about his driving record. 43 A submission that it should be inferred that Mr Celik had completely failed to answer, as distinct from having given an incomplete answer to, a question about his driving record would be difficult to sustain in the light of the contents of the confirmation of details. 44 Although the magistrate in her judgment stated the submission which had been made to her as being that "in requesting a listing Ms Fuller demonstrated that she had been put on notice (that) the answers given by Mr Celik were incomplete", I do not consider that a submission stated in those terms differs significantly from the submission as put by counsel for the appellants. An inference that Mr Celik had given an obviously incomplete answer to Ms Fuller would be tantamount to an inference that Ms Fuller had been put on notice that an answer given by Mr Celik was incomplete. 45 It is apparent from the magistrate's judgment that the magistrate rejected any submission that Ms Fuller had been put on notice that the answer given by Mr Celik about his driving record was incomplete and hence the magistrate should be taken as having rejected an equivalent submission that the answer given by Mr Celik about his driving record was obviously incomplete. 46 Mr and Mrs Celik cannot succeed on this first ground of appeal, unless the magistrate erred in law in not inferring, from Ms Fuller's requiring that Mr Celik provide an RTA listing, that Mr Celik had given an incomplete answer to a question in the proposal form about his driving record. The magistrate would have so erred in law, only if that inference was the only inference which could reasonably be drawn. 47 I do not consider that the magistrate erred in law in not drawing this inference. 48 The contents of the confirmation of details were a serious obstacle to the drawing of such an inference. According to the confirmation of details, when read with the prompt, Mr Celik did not fail to answer and did not give an obviously incomplete answer to a question whether in the last five years he had had any driving offences or traffic infringements. According to these documents, Mr Celik gave an answer and the answer he gave was categorical and complete - he had not had any driving offences or traffic infringements in the last five years. 49 Ms Fuller, having no actual recollection of what had happened on 27 June 1995, could not say why she had required the RTA listing. However, her action in requiring Mr Celik to provide an RTA listing is readily explicable on grounds other than that Mr Celik had failed to answer or had given an incomplete answer to a question about his driving record. For example, a prudent employee of an insurer might well wish to be provided with official confirmation of an answer by a person applying for insurance that he had had no driving offences or traffic infringements within the last five years. 50 Mr Celik's failure to provide an RTA listing cannot be relied on as bringing s21(3) into operation. The requirement that he provide an RTA listing was not "a question", nor was it contained in a "proposal form", even if "proposal form" is given the wide meaning referred to earlier in this judgment. 51 I reject the first ground of appeal.

The magistrate found as a fact that the plaintiff, Mr Celik, attended at the Auburn branch of the NRMA on 27 June 1995, where there was insufficient evidence to support this finding.

The Magistrate erred in according weight to the evidence of Ms Fuller (a representative of the Defendant) as to her usual practice in relation to the creation of an insurance policy document, particularly in circumstances where Ms Fuller had no independent recollection of the transaction. 52 Although these grounds of appeal were not formally abandoned at the hearing, it was acknowledged by counsel for the appellants that the decision of the majority of the Court of Appeal in Azzopardi v Tasman UEB Industries Limited (1985) 4 NSWLR 139 and the subsequent decisions of the Court of Appeal following Azzopardi presented a serious obstacle to these grounds of appeal succeeding, in an appeal in which only errors of law can be relied on. 53 In my opinion, neither of these grounds of appeal can succeed, in the light of the decision of the majority of the Court of Appeal in Azzopardi. The magistrate did not make any error of law in accepting and giving weight to Ms Fuller's evidence about the usual practice at the Auburn branch of NRMA Insurance. Nor did the magistrate make any error of law in making a finding that Mr Celik had attended at the Auburn branch of NRMA Insurance on 27 June 1995. It was not the case that there was no evidence to support such a finding. In Azzopardi Glass JA quoted with approval McPhee v S Bennett Limited (1935) 52 WN (NSW) 8 at 9 where it was said:- "But if there is evidence of the fact, the question whether that evidence ought to be accepted in whole or in part, or ought to be accepted as sufficient to establish the fact, is itself a question of fact and not a question of law…." 54 I reject these grounds of appeal.

The Magistrate failed to consider the application of s23 of the Insurance Contracts Act 1984 in determining what a reasonable person in the position of Mr Celik would have understood when asked the question as to his driving record in the proposal form.

The Magistrate failed to give sufficient weight to the evidence provided as to the Plaintiff, Mr Celik's comprehension of English, in circumstances where the Magistrate stated that she accepted an expert report prepared in this regard by Ms Barrier. 55 The magistrate accepted that Mr Celik had a limited command of English. However, the magistrate was satisfied that, despite his limited command of English, he had understood the question he was asked about his driving history and he had been well aware of his obligation to disclose his full driving history. The magistrate did not make any error of law by failing "to give sufficient weight" to the evidence about Mr Celik's limited command of English. 56 I comment that the information set out in the confirmation of details, which, on the magistrate's findings, had been supplied by Mr Celik in answer to questions asked by Ms Fuller, does not suggest any inability on the part of Mr Celik to understand the questions he was asked. 57 Section 23 of the Insurance Contracts Act is in the following terms:- " Ambiguous questions Where (a) a statement is made in answer to a question asked in relation to a proposed contract of insurance or the provision of insurance cover in respect of a person who is seeking to become a member of a superannuation or retirement scheme; and (b) a reasonable person in the circumstances would have understood the question to have the meaning that the person answering the question apparently understood it to have; that meaning shall, in relation to the person who made the statement, be deemed to be the meaning of the question" 58 It is difficult to see how any question which would have been asked by Ms Fuller on the basis of the question in the prompt "in the last 5 years has any owner or driver had any driving offences or traffic infringements?" would have been ambiguous, so as to bring s23 into operation. 59 Mr Celik, whose evidence was that he had not gone to NRMA Insurance's Auburn branch, was not in a position to give, and did not give, any evidence about the sense in which he had understood any question asked by Ms Fuller. 60 I reject these grounds of appeal.

The magistrate failed to give reasons or adequate reasons for her finding that the plaintiff, Mr Celik's, failure to disclose was fraudulent. 61 It was submitted that, in relation to the magistrate's conclusion that Mr Celik's failure to disclose had been fraudulent, the magistrate had failed in her judgment to state the relevant facts found by her and to give reasons for her finding of such facts and had thereby committed an error of law. Reference was made to Pettitt v Dunkley (1971) 1 NSWLR 376 and to subsequent cases in the Court of Appeal. It was particularly urged that the magistrate had failed in her judgment to take into account the evidence that Mr Celik had only a limited command of English. 62 I do not consider that there was a failure by the magistrate to state the facts found by her or to give reasons for her finding of those facts, such as to amount to an error of law. 63 The magistrate made a finding of fact, which she stated in her judgment, that Mr Celik had attended the Auburn branch of the NRMA Insurance and had himself requested the preparation of the confirmation of details. The magistrate gave reasons in her judgment for making this finding. A particular reason given by the magistrate was that the confirmation of details contained information, about which finance company was involved and what the price of the vehicle was, which was incorrect and which was, accordingly, information which it was most unlikely that Mr Spiteri would have provided. 64 The magistrate made a finding of fact, which she stated in her judgment, that Mr Celik had failed to disclose his driving record to Ms Fuller. A reason given by the magistrate in her judgment for making this finding was that she accepted evidence by Ms Fuller that, if Mr Celik had disclosed his driving record to her, she would not have prepared the confirmation of details in the form in which she did. 65 The magistrate made a further finding of fact, which she stated in her judgment, that the non-disclosure by Mr Celik of his driving record was fraudulent. In the process of arriving at this finding, the magistrate accepted that Mr Celik had only a limited command of English and would not have been able, unaided, to have read the confirmation of details or the renewal forms. However, the magistrate gave as reasons for making her finding that she was satisfied, on the basis of evidence given by Mr Celik himself, that he was aware of the importance to an insurer of information about his driving offences and that she did not accept that Mr Celik's command of English was so poor that he did not understand a question he was asked about his driving record. 66 It was submitted that an allegation of fraud in a civil case is an allegation of a serious nature and that such an allegation should not be found to have been established, except in accordance with the principles stated by Dixon J in Briginshaw v Briginshaw (1938) 60 CLR 336 at 362-363. 67 I accept that the principles stated in Briginshaw are applicable. However, I do not accept that there was any infringement of those principles by the magistrate. On my reading of the magistrate's judgment, the magistrate was satisfied that fraud had been clearly proved. The magistrate did not rely on "inexact proofs, indefinite testimonies or indirect inferences" or engage in a mere mechanical comparison of probabilities, independent of any belief in the truth of the findings she made. 68 The magistrate did not make any error of law by not expressly referring in her judgment to Bringinshaw. 69 I dismiss the summons and order the plaintiffs-appellants Mr and Mrs Celik to pay the defendant-respondent NRMA Insurance's costs of the appeal.

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