Churchill v Clearview Life Assurance Ltd [2023] QSC 225

• [1] The applicant in these proceedings (the defendant) seeks leave pursuant to rule 188 of the Uniform Civil Procedure Rules 1999 (Qld) (UCPR) to withdraw deemed admissions contained in their defence filed 27 April 2022. The respondent in these proceedings (the plaintiff) does not oppose the defendant having leave to withdraw some of the deemed admissions, but not all.
• [2] The defendant's amended application seeks leave to withdraw 52 deemed admissions. However, only 11 of these are now in contest.
• [3] Accordingly, in relation to this application, I only need to consider the unresolved deemed admissions that are contained in paragraphs 19, 31(b), 38(b), 38(c), 38(d), 42, 43, 44, 51(b), 51(c), 70(b) of the defence.

• [4] Rule 188 of the UCPR provides:

A party may withdraw an admission made in a pleading or under rule 187 only with the court's leave."

• [5] In DJ & MA Hose Pty Ltd ATF Hose Family Trust v Wide Bay Insurance Broking Pty Ltd ATF Wide Bay Business Trust[1] Hindman J summarised the principles relevant to the withdrawal of admissions made in a pleading:

[44] Rule 188 UCPR provides that a party may withdraw an admission made in a pleading or under rule 187 UCPR only with the court's leave.

[45] Whilst the discretion to grant leave is a broad one, the following factors can be relevant in determining whether to exercise the discretion to grant leave:

(a) there is no principle that admissions made, or deemed to have been made, may always be withdrawn "for the asking", subject to payment of costs;

(b) sworn evidence is generally required verifying the circumstances justifying the grant of leave;

(d) "whether the subject matter of the admission is truly contested";

it is not enough for the applicant "simply to assert that a dispute exists";

(e) evidence surrounding the issues the subject of the admission;

(f) "an admission may be withdrawn if the admission is contrary to the actual facts";

(g) whether there is likely to be a real dispute about the evidence, including detailed particulars of the issue or issues which the party would raise at trial if the admission was withdrawn;

(h) any delay in making the application for leave to withdraw the admission and if that delay is explained; and

(a) distinguished between the evidence that may be required in respect of an application for leave to withdraw express admissions as opposed to deemed admissions; and

(b) noted that in exercising the discretion to give leave there is no "a priori rule as to what evidence is required in every case. Nor is that an a priori rule that an affidavit generally verifying a proposed defence will not be enough."

[47] The discretion to withdraw an admission is to be guided by rule 5 UCPR.

[48] In Davies v Davies (No 1) Bradley J, referring to the analogous discretion in rule 367 UCPR wrote:

"[45] The court has a broad power to make 'any order or direction about the conduct of a proceeding it considers appropriate' that may be engaged to grant leave to withdraw an admission. The interests of justice are paramount in determining whether an order or direction should be made. The broad power is to be applied with the objective of 'avoiding undue delay, expense and technicality' and facilitating 'the just and expeditious resolution of the real issues ... at a minimum of expense.' The court's inherent power to control and supervise proceedings extends to granting such leave where that is an 'appropriate action to prevent injustice'.

[46] A party seeking leave to withdraw an admission should identify the reason for the withdrawal, explain how the admission came to be made, and identify any prejudice that may be caused if the application is refused. The stage of the proceeding, the prospects of the party succeeding on the issue if the admission is withdrawn, any prejudice to other parties if the admission is withdrawn, and any other matter affecting the administration of justice should be considered to determine how the interests of justice may be served, consistently with the express objective of the rules. All of these matters may inform the exercise of the discretion under r 367 or the court's inherent power"."

• [6] In this case the plaintiff's submissions focus on two issues in relation to the unresolved paragraphs, being whether:

(a) the subject matter of the admission is truly contested; and

(b) reasonable inquiries have been made to find out whether the allegation is true or untrue.

• [7] In relation to whether the subject matter is truly contested, Chesterman JA observed in Hanson Construction Materials Pty Ltd v Davey & another[2] that:

"[15] It is no doubt true that the UCP Rules are meant to expedite litigation and to limit disputes to issues that are genuinely in contest, but it must, in my respectful opinion, remain the case that the rules do not operate so as to prevent the trial of issues that are genuinely in dispute.

[16] The first consideration, therefore, in an application to withdraw admissions must be whether the subject matter of the admission is truly contested. Often, if not always, that determination will be informed by the circumstances in which the admission was made. It is usually a good indication that a fact is not in dispute that the party against whom it is made admits it to be true. This, I apprehend, is why the cases emphasise the need for an explanation as to the making of the admission. If an applicant cannot demonstrate that there is a real dispute about the subject matter of the admission no other consideration need be examined."

• [8] The cases are clear that before permitting the admission to be withdrawn, the first step to be determined is whether there is a genuine dispute about the defendant's liability in the action. For that purpose, it is not enough to simply to assert that a dispute exists.
• [9] Margaret Wilson J observed in Hartmann v Pilkington & Ors (Hartmann)[3] that it follows from the necessity of demonstrating that there is a real dispute about the subject matter of the admission that an applicant for leave needs to show the response he or she would belatedly make to the allegation and to confirm that that response would accord with evidence available to be led at trial.
• [10] This in turn raises another issue, i.e. the circumstances where an admission can be withdrawn and a non-admission can then be pleaded. As Margaret Wilson J stated in Hartmann:[4]

"[16] The rules acknowledge that a party's pleading may contain an allegation of fact which is outside the knowledge of the opposing party, and that even after reasonable inquiries the opposing party may still not know whether such fact is true or untrue. In such cases, they permit the opposing party to plead a nonadmission, so long as it is accompanied by a direct explanation for the opposing party's belief that it cannot be admitted.

[17] There is no warrant for restricting the circumstances in which leave to withdraw an admission may be granted to those in which the applicant wishes to plead a denial and can provide a "direct explanation" for his or her belief that the allegation is untrue.

[18] There may be facts solely within the knowledge of the party who pleads them. Where, however, a party ("A") pleads a conversation between him or her and a third party ("X"), the opposing party ("B") will seldom be entitled to plead a non admission simply on the basis that he or she was not a party to the conversation and its contents are within the knowledge of A. In most cases it would be reasonable to expect B to make inquiries of X to ascertain the truth or untruth of what has been pleaded. Similarly, where A pleads facts about his or her own occupation or use of land, B will seldom be entitled to plead a nonadmission simply on the basis that those facts are within the knowledge of A. In most cases it would be reasonable to expect B to make inquiries to ascertain the truth or untruth of what A has pleaded about him or herself. Of course, such inquiries may not be fruitful, and thus B may be justified in pleading a nonadmission.

[20] I consider that where a party wishes to withdraw an admission and instead to plead a non admission, he or she should not usually be given leave to do so in the absence of sworn evidence of inquiries made to find out whether the allegation is true or untrue, and the Court's being satisfied that those inquiries were reasonable in all the circumstances."

• [11] In January 2014, the plaintiff was investigated by the Australian Securities and Investment Commission (ASIC), which led to him entering into an enforceable undertaking with ASIC.
• [12] Following the investigation by ASIC, the plaintiff contends that from September 2015 he developed various psychological conditions such as Moderate Depressive Disorder, Anxiety Disorder and Adjustment Disorder with Mixed Anxiety and Depressed Mood. Accordingly, he contends that he has suffered a sickness within the meaning of the life insurance policies issued by the defendant and was unable to work or perform various income producing duties as a result of the sickness.
• [13] On 8 November 2021, the plaintiff commenced this proceeding against the wrong entity. The defendant raised this issue in correspondence with the plaintiff on 6 December 2021, and on 10 March 2022 the plaintiff served an amended claim and statement of claim (ASOC) against the defendant (the correct entity).
• [14] The defence was filed and served on 27 April 2022.
• [15] The plaintiff claims entitlement to certain benefits under life insurance policies issued by the defendant. In summary, the plaintiff claims he:

(a) is entitled to a total permanent disability benefit (TPD benefit);

(b) is entitled to two benefits for income protection:

(i) first, that he was entitled to be paid a monthly income protection benefit (monthly IP benefit) until he elected to receive a lump sum income protection benefit (lump sum IP benefit);

(ii) second, the lump sum IP benefit;

(c) would not have had to pay the premium for the financial year 2021.

• [16] The parties agree on the conditions under the policies that need to be met for the defendant to be liable to pay any of the above benefits.
• [17] Pursuant to the conditions of the TPD benefit, the plaintiff must demonstrate (among other things) that as a result of a sickness or injury he was unable to work in his own occupation for any three-month period and at the end of that period he was disabled to such an extent that he is unlikely to ever work again in his own occupation.
• [18] There is a dispute between the parties as to what the plaintiff's occupation is for the purpose of the policies.
• [19] The plaintiff's position, as set out in paragraph 19 of the ASOC, is that his occupation was as a financial planner specialising in life insurance. The defendant's position is that the plaintiff's position is not limited to a specialisation in life insurance.
• [20] The defendant also disputes the severity of the plaintiff's sickness - which are alleged to be psychological conditions - and whether as a result of that sickness he cannot work or is unlikely to work in his occupation.
• [21] In relation to the conditions for the lump sum IP benefit the plaintiff must demonstrate (among other things) the conditions for the TPD benefit and a further condition that he has chosen to accept the lump sum IP benefit in lieu of the monthly IP benefit.
• [22] In relation to the conditions for the monthly IP benefit two assessments are pleaded, either of which can be satisfied:

(a) first, an hours-based assessment which requires (among other things) the plaintiff, solely because of sickness or injury, to be unable to work for more than 10 hours per week in his regular occupation, unable to perform important income producing duties of his regular occupation for more than 10 hours per week and be under the care of a medical practitioner in relation to the sickness or injury; and

(b) second, a duties-based assessment which requires (among other things) the plaintiff, solely because of sickness or injury, to be unable to perform one or more important income producing duties of this regular occupation, under the care of a medical practitioner in relation to the sickness or injury and not working.

• [23] It is noted that the same issues arise in respect of the TPD benefit except that the wording is slightly different.
• [24] In this matter there is a dispute as to what the plaintiff's income producing duties were and whether he was, or is, unable to perform those duties.
• [25] The defendant's position is that the plaintiff was not unable to work or perform various income producing duties as a result of a sickness (the defendant denies that the plaintiff has suffered all of the psychological conditions based on medical evidence). Rather, the defendant submits that the plaintiff was able to work and sold his business.
• [26] The plaintiff claims that he satisfies the other conditions of the TPD benefit, monthly IP benefit and lump sum IP benefit.

• [27] In relation to paragraphs 19, 38 (b) (c) and (d) and 70, the defendant has pleaded to the allegation. However, the defendant has not expressly denied or not admitted the allegation. Accordingly, such allegations are deemed to be admitted pursuant to rule 166(1)(a) of the UCPR.
• [28] In relation to paragraphs 41, 42, 44, 51 (b) and (c), the defendant does not admit the allegation. However, the non-admission is not accompanied with a direct explanation as to why the allegation cannot be admitted (bare non-admission). Accordingly, the allegations are deemed to be admitted pursuant to rules 166(4) and (5) of the UCPR.

How did the defendant make these deemed admissions?

• [29] The defendant relies on an affidavit by Mr Andrew Gawthorne, a solicitor, who has had day to day conduct of this matter since 10 November 2021. Mr Gawthorne states that a New South Wales counsel was briefed in relation to this matter who advised him on 23 February 2022 to brief a Queensland counsel to settle the defence. However, this did not occur until April 2023.
• [30] In relation rule 166 of the UCPR, Mr Gawthorne states:

"72. When drafting the defence, I was aware of the existence of rule 166 of the Uniform Civil Procedure Rules 1999 (Qld) (the UCPR). I read the rule. I noted the requirement that a denial or non-admission be accompanied by a direct explanation for the defendant's belief. I thought that the requirement for a direct explanation for a denial or non-admission in one paragraph was met if it was accompanied by other paragraphs which contained a pleading of the defendant's case on the issue, for example paragraphs 74 and 80 of the defence, which addressed the defendants reasons for declining the IP and TPD Benefit Claims respectively.

1. I was not aware it was necessary to state the reason for the denial or non-admission after each denial or non-admission based on my experience, the defence was compliant with the requirements of the New South Wales Supreme Court. I believe, albeit mistakenly now I apprehend with hindsight, that the defendant had complied with the requirements of rule 166.
2. I am informed by Mr Walsh, and believe, that he was also aware of rule 166 of the UCPR. However, he also proceeded under the same mistaken belief as me that:

(A) The defendant did not need to provide a direct explanation for each and every denial and non-admission directly after the denial and non-admission;

(B) That the rule would be complied with if the defence traversed the issue somewhere clearly within the defence."

• [31] Mr Gawthorne states that the defence was prepared under significant time pressure and in the circumstances, he formed the view there was insufficient time to brief a Queensland based barrister due to the time available and the volume of documents.
• [32] I note that on 5 September 2022, the defendant's solicitor received a copy of the plaintiff's reply which stated that the plaintiff adopts the deemed admissions arising from the defence by operation of rule 166 (5) of the UCPR. Accordingly, as of this date, the defendant was put on notice that the plaintiff was proceeding on the basis that the defendant had made deemed admissions.
• [33] After this date there was further correspondence between the parties' solicitors, some of which I will refer to.
• [34] On 31 October 2022 the plaintiff's solicitor sent their draft management document plan. In their covering letter, the plaintiff's solicitors stated that they considered the following issues to be the subject of deemed admissions in the defence:

(a) the meaning of 'sickness' under the policy;

(b) the reasonableness of the defendant's determination to decline the TPD claim;

(c) the reasonableness of the defendant's determination to decline the income protection claim;

(d) whether the plaintiff was, as at the date of the determinations, sick or otherwise unable to return to work as a financial advisor; and

(e) whether the plaintiff met the requirements of the Own occupation TPD definition outlined in the Policy.

• [35] Mr Gawthorne states that he did not understand that deemed admissions had been made as to the matters alleged by the plaintiff.
• [36] On 30 January 2023, the defendant's solicitors received a letter from the plaintiff's solicitor that set out their intention to rely on deemed admissions contained within the defence to support the appropriateness of the plaintiff's document management plan over that of the defendant's.
• [37] On 28 March 2023, the defendant's solicitors sent correspondence to the plaintiff's solicitor requesting clarification of the paragraphs (or sub-paragraphs) of the defence which the plaintiff viewed as deemed admissions and, accordingly, purported to adopt.
• [38] On 12 April 2023, the defendant engaged Queensland counsel for the first time and on 13 April 2023 the defendant's solicitor received correspondence from the plaintiff solicitor setting out the paragraphs which the plaintiff considered deemed admissions under paragraph 166 of the UCPR.
• [39] I accept that in this case that the deemed admissions were made in genuine error by New South Wales practitioners who did not appreciate the proper construction of the pleading rules in Queensland.
• [40] Although the New South Wales practitioners could have could have acted with more haste up until they briefed counsel in Queensland, by preparing their defence and briefing Queensland counsel earlier, their actions must be seen in the context of their misunderstanding of how the Queensland UCPR operated.
• [41] In all the circumstances I am satisfied that Mr Gawthorne has provided an adequate explanation as to how the deemed admissions were made and the delay in bringing this application has been explained in his affidavit material.

• [42] In this case the plaintiff states that the effect of granting the defendant leave to withdraw admissions will be that the plaintiff will need to prove allegations that, as things presently stand, are admitted. This, the plaintiff submits, will also have consequential effects on disclosure and gives rise to four forms of prejudice to the plaintiff.
• [43] First, the plaintiff will need to seek to obtain documentary evidence from third parties for some of the issues that would be raised if leave were granted. The allegations sought to be put back in issue go back a substantial period of time, for example:

(a) the allegation in paragraph 19 of the statement of claim about the plaintiff's occupation conceivably requires evidence going back to April 2013 when the plaintiff first took out insurance with the defendant;

(b) the allegation about Mr Churchill being under the 'regular care' of Dr Fenelon in paragraph 38 of the statement of claim goes back to 4 September 2015; and

(c) the allegation in paragraph 51 of the statement of claim, about the decrease in the rate of Mr Churchill's writing of policies, relates to the period between 2014 and 2016.

• [44] The plaintiff submits that this passage of time means that there is a serious risk that such evidence will be no longer available.
• [45] Second, in similar vein to the first form of prejudice raised_,_ the plaintiff states that some of the allegations being put in issue if leave were granted concern conversations alleged to have occurred a long time ago, for example:

(a) paragraph 31 of the statement of claim relates to something told to Mr Churchill in January 2015; and

(b) paragraph 43 concerns, amongst other things, a conversation between a Ms Kalantzis and Mr Churchill in November 2015.

• [46] Accordingly, the plaintiff refers to the serious risk that witnesses' memories may have dimmed in relation to conversations due to the passage of time. The plaintiff submits that it would be an error to only consider the marginal prejudice measured by a comparison between the evidence available at the commencement of the proceeding versus the evidence available now. In circumstances where the admissions have been made by the defendant, the plaintiff submits that the relevant comparison is between:

(a) not having to prove the admitted matters; and

(b) having to prove them with the risks associated with the passage of time.

• [47] This, the plaintiff submits, is even more so in this case, when so much of the time between the plaintiff's original making of his insurance claims and the commencement of this proceeding was taken up by the defendant considering the claims.
• [48] The third species of prejudice that arises relates to the plaintiff's particular condition. The plaintiff's solicitor's evidence is that:

"... exacerbated levels of stress and anxiety are triggered every time the plaintiff is advised about a step in the proceeding and has to provide instructions that require him to recall or think about the events the subject of the claim."

• [49] The plaintiff submits that giving the defendant leave to withdraw admissions will increase the exacerbation of the stress and anxiety suffered by the plaintiff i.e., to the extent that the defendant's admissions are permitted to be withdrawn, then the extent to which instructions must be sought from the plaintiff increases, and the extent to which his stress and anxiety is exacerbated is increased.
• [50] Fourth, the plaintiff has made disclosure based on the issues on the pleadings (including the deemed admissions). The granting of leave to withdraw the admissions will require this process to be redone.
• [51] Any issue of prejudice needs to be examined in relation to the deemed admission that is being sought to be withdrawn and not on a general abstract basis. This involves considering not only the paragraph in question but also any other paragraphs which are relevant but not in dispute between the parties.
• [52] I have considered the issues of prejudice as raised by the plaintiff, in particular the effect of delay on the quality of justice as observed by Mc Hugh J in Brisbane South Regional Health Authority v Taylor.[5] Taking into account all of the circumstances of this case, I am satisfied that the issue of delay and prejudice does not loom large. This is especially where the plaintiff concedes that the defendant can withdraw a number of deemed admissions, but not all.
• [53] Prior to the hearing, a substantial number of deemed admissions were resolved between the parties. Accordingly, any issues of delay in bringing this application, increased costs implications and increased stress being incurred by the plaintiff has limited relevance unless it particularly relates to an unresolved deemed admissions in question. I note that most of the deemed admissions are due to form, as the substance of the facts relied upon were always pleaded or particularised in the respective allegations in the existing defence. Accordingly, the plaintiff has been on notice about these issues for some time.

"19. The only occupation that Mr Churchill was regularly engaged in at any material time was that of a financial adviser specialising in life insurance products (Life Insurance Adviser)."

"19. In response to paragraph 19 of the Amended Claim, the Defendant:

(a) says that the relevant occupation in which the Plaintiff was regularly engaged for the purposes of the Policy was the occupation of financial advisor; and

(b) denies that the plaintiff's occupation for the purposes of the "total disability" and Own occupation TPD definitions in the Policy is limited to a specialisation in life insurance products."

"19. In response to The defendant denies paragraph 19 of the statement of claim, on the denial basis, because Amended Claim the Defendant:

(a) says that the relevant occupation in which the plaintiff was regularly engaged for the purposes of the Policy was the occupation of financial advisor; and

(b) denies that the plaintiff's occupation for the purposes of the "total disability" and Own occupation TPD definitions in the Policy was not limited to a specialisation in life insurance products."

• [57] The plaintiff states that paragraph 19 of the ASOC has three factual dimensions:

(a) the only occupation that Mr Churchill was regularly engaged in at any material time (emphasis added);

(b) was that of a financial adviser;

(c) specialising in life insurance products (Life Insurance Adviser).

• [58] Accordingly, the plaintiff states that paragraph 19 of the ASOC raises an allegation of fact (about the fact of the plaintiff's occupation) and not an allegation about the proper construction of the insurance policy.
• [59] The plaintiff emphasises that to show a genuine dispute about a fact that warrants leave to withdraw an admission, it is necessary for a party to do more than merely assert the existence of such a dispute. The plaintiff states that the defendant has not made any inquiries and doesn't point to any evidence to suggest that the plaintiff was engaged in any other profession:

"MR MAY ...the evidence that the defendant relies upon is evidence where there's a reference to Mr Churchill working as a financial advisor. That is not evidence suggesting a genuine dispute about him specialising - working as a financial advisor specialising in life insurance. Evidence that he works as a financial advisor is consistent with him working as a financial advisor specialising in life insurance unless there's some evidence to be pointed to - or some inquiries made indicating either some other occupation or some different specialisation or not having that specialisation."

• [60] The plaintiff submits that there is no evidence led by the defendant, for example, suggesting that the plaintiff provided financial advice in respect of anything other than life insurance products. Accordingly, the defendant's affidavit material shows a lack of evidence about relevant enquiries that could have been made:

"MR MAY: ... So the defendant could've asked its related entity, "What sort of work was Mr Churchill doing? Did Mr Churchill do any advice - did - do any financial advising that wasn't life insurance work?" The defendant could've asked other entities which 10 it has identified Mr Churchill having provided advice for information about what advice he provided or what kind of work he was doing to address this allegation. But there's no evidence of any inquiries of that kind, and in that circumstance, in my submission, this really isn't in the category of something that's in genuine dispute."

• [61] The plaintiff refers to the additional prejudice that if the deemed admission was withdrawn it would put the plaintiff in the position of having to obtain and give evidence that the only occupation he was regularly engaged in at any material time was a financial adviser specialising in life insurance policies, which would in effect involve proving a negative. The plaintiff states that this would involve him proving everything he did which would be a significant burden.
• [62] Accordingly, the plaintiff submits that leave should be refused leave to withdraw the admission in paragraph 19 of the defence.
• [63] In relation to paragraph 19, the fabric of the material allegations in the defence remains wholly intact, with the only amendments being the adoption of the formal language of r 166 of the UCPR to deny the ASOC allegation to which it responds.
• [64] In my view, reading the ASOC as a whole, paragraph 19 raises a mixed question of fact and law in relation to the operation of the policy by reference to those facts which is the subject of the plea in paragraph 19.
• [65] Paragraph 4(d) of the ASOC pleads facts, i.e. between approximately 1999 and at least September 2015, the plaintiff worked in his regular occupation as a financial adviser specialising in life insurance policies. The defendant admits this.
• [66] Paragraph 19 of the ASOC then appears in (Part C CIRCUMSTANCES GIVING RISE TO CLAIMS). Part C.1 deals with the plaintiff's occupation and duties.
• [67] Paragraph 19 pleads that the plaintiff's occupation for the purpose of the policy was that of a financial advisor specialising in life insurance. That is a matter which the defendant seeks to contest by reference to the policy and what the policy means.
• [68] In my view, paragraph 19 of the proposed amended defence raises a genuine dispute. It raises a question of what the occupation of the plaintiff is for the purpose of the policy provisions which are pleaded.
• [69] The dispute in relation to paragraph 19 turns on what the plaintiff's occupation was (per se, or by specialisation) for the purpose of the policy, and in turn how the policy gave treatment to the occupation enjoyed. Accordingly, in such circumstances, no further explanation or inquiry is required for the purpose of withdrawing the deemed admission.

"38. From 4 September 2015, Mr Churchill has been under the regular care, and following the advice, of Dr Fenelon in relation to his mental health."

• [72] Particulars are then provided of the dates when the plaintiff attended Dr Fenelon.
• [73] The defence states:

"38. In response to paragraph of 38 of the ASOC, the defendant:

(a) admits that the plaintiff has attended appointments with Dr Fenelon between 4 September 2015 and 24 October 2019 as particularised;

(b) says that it has not been provided with Dr Fenelon's consultation records after 24 October 2019, does not know and does not admit the attendances after 24 October 2019

(c) says that the advice referred to is not identified and the Defendant therefore does not know and does not admit that the Plaintiff has been following it, or whether the Plaintiff has been under the 'regular care' of Dr Fenelon;

(d) says that not all of the appointments particularised were for care and advice in relation to the plaintiff's mental health.

1. 26 February 2016 (pain in toe / right intra-articular injection 1st MTPJ);

(ii) 3 November 2016 (severe left chronic ATFL Rupture);

(iv) 20 February 2017 (impact to foot from cricket ball / x-ray);

(vii) 5 April 2019 (ankle and hip pain after moving house)."

"38. In response to paragraph of 38 of the statement of claim ASOC, the defendant:

(b) denies, on the denial basis, that the plaintiff attended the following appointments with Dr Fenelon prior to 24 October 2019 in relation to his mental health because the purpose of the appointment was as stated in brackets:

(i) 26 February 2016 (pain in toe / right intra-articular injection 1st MTPJ);

(ii) 3 November 2016 (severe left chronic ATFL Rupture);

(iv) 20 February 2017 (impact to foot from cricket ball / x-ray);

(vii) 5 April 2019 (ankle and hip pain after moving house); and

(c) otherwise, does not admit the allegations on the non-admission basis.

(b) says that it has not been provided with Dr Fenelon's consultation records after 24 October 2019, does not know and does not admit the attendances after 24 October 2019

(c) says that the advice referred to is not identified and the Defendant therefore does not know and does not admit that the Plaintiff has been following it, or whether the Plaintiff has been under the 'regular care' of Dr Fenelon;"

• [75] Paragraph 38 pleads that from 4 September 2015, the plaintiff has been under the regular care, and following the advice, of Dr Fenelon in relation to his mental health.
• [76] In the proposed amended defence the defendant does not admit the allegations on the non-admission basis. Fraser JA in Aimtek Pty Ltd v Flightship Ground Effect Pte Ltd[6] discussed the rules relating to non-admissions:

"[8] The rules concerning nonadmissions differ from the rules concerning denials. Fryberg J's conclusions cannot be applied to the pleading in this case. Rule 166(4) requires a direct explanation for the party's belief that the allegation can not be admitted: Cape York Airlines Pty Ltd v QBE Insurance (Australia) Ltd [2008] QSC 302; [2009] 1 QdR 116 at 121-122 [22], but it would be mere pedantry to insist that a pleaded expression of that belief is defective merely because it does not precisely adopt the words used in the rule. Barker v Linklater [2007] QCA 363; [2008] 1 QdR 405 is inconsistent with any such requirement. In that case, Muir JA (with whose reasons Jerrard JA, who gave additional reasons, and Douglas J agreed) held that a non-admission "on the grounds that the defendants are unable to attest to the truth or otherwise" of specified allegations, amounted to a non-admission which was accompanied by the necessary "direct explanation for the party's belief that the allegation ... can not be admitted" - albeit that the explanation "paid scant heed to grammatical rules and was not felicitously expressed": at 419-420 [47]-[48]. The respondent's pleading should not be held to be defective merely because it might have been expressed more elegantly."

• [77] The plaintiff refers to the requirement for the defendant to show that there is some genuine dispute about what it now wishes to be able to plead, and emphasises that the defendant has failed to speak to Dr Fenelon in circumstances where they have authority to do so:

"MR MAY: They need to speak to Dr Fenelon and ask him.

HER HONOUR: But what doc - is Dr Fenelon say? "He came. I did all these things. He came again and he did all these things." Did he follow the advice? How will that - how could that be ascertained?

MR MAY: Well, in my submission, that could be ascertained. Dr Fenelon would - and, in particular, what Dr Fenelon, if it were the case, could provide to the defendant is information suggesting that Mr Churchill has not followed his advice, but there's nothing of that character. Your Honour's quite right that it may be that the investigations might not have gone anywhere, but what the cases say is that the party needs to do the investigations and put on the evidence of the investigations.

MR MAY: - - - and that - and the explanation given by the defendant for not having asked Dr Fenelon is that Dr Fenelon "wouldn't have told us", and that doesn't withstand scrutiny, given the authority that my client gave."

• [78] The plaintiff submits that given the lack of evidence from the defendant they should not be given leave to withdraw the admissions arising from paragraphs 38(b), (c) and (d).
• [79] I note that in relation to paragraph 38, the fabric of the plea has not changed greatly in the proposed further amended defence. It has always been admitted by the defendant, and remains admitted, that the plaintiff has attended appointments with Dr Fenelon between certain dates in relation to his mental health. It has been pleaded, and remains pleaded, that some of those appointments were not in respect of his mental health.
• [80] The issue raised in relation to the amendment of paragraph 38 concerns the narrow issue of whether the plaintiff followed the doctor's instruction which, conceptually, necessarily involves his subjective response.
• [81] What is required is that the defendant has made reasonable enquiries to ascertain whether the allegation is true or untrue which in turn concerns the subjective nature of whether the plaintiff followed the advice of Dr Fenelon. In my view, the only inquiries that could be made in relation to this issue is with the plaintiff himself. He is not an independent person of whom enquiries could be made by the defendant but rather is the person who makes the allegation.
• [82] In all of the circumstances, I am satisfied that there is a genuine dispute and I give leave to withdraw the deemed admission in paragraph 38 of the defence.

• [83] The same general point raised in relation to paragraph 38 also arises in relation to paragraphs 42 and 44 as they raise both raise allegations about the plaintiff's belief.
• [84] Paragraph 42 of the ASOC states:

(i) Clearview Financial had robust compliance procedures;

(ii) he had complied with Clearview Financial's compliance procedures;

(iii) he had complied with all relevant compliance requirements applicable to a Life Insurance Adviser;

(iv) ASIC's Concerns were baseless;

(v) ASIC were acting capriciously in pursuing ASIC's Concerns in the sense that Mr Churchill believed that:

(A) in some respects, ASIC's demands were not possible to meet due to limitations of Clearview Financial's software or unavailability of information from insurers;

(B) in all respects, ASIC's demands would not have any material impact on client outcomes;

(C) ASIC intended to pursue its concerns regardless of whether they were baseless or not;

(vi) it would be futile to contest ASIC's Concerns;

(vii) he had no option but to give the undertaking sought by ASIC;

(viii) he was bullied into providing the undertaking sought by ASIC;

(b) Mr Churchill was distressed, depressed, frustrated, upset and anxious about those matters; and

(c) in particular, Mr Churchill was distressed, depressed, frustrated, upset and anxious because he believed that, no matter what he did:

(i) he would never be able to achieve what ASIC considered to be compliant conduct; and

(ii) he would always be at risk of ASIC raising concerns about compliance that would be futile to contest as he would again be bullied into not contesting such concerns."

"42. In response to paragraph 42 of the ASOC, the defendant:

(a) says that the Plaintiff's belief as to the matters alleged in sub-paragraph 42(a) is not relevant to the Plaintiffs cause of action against the Defendant in these proceedings; and

(b) does not know, has no means of ascertaining and does not admit the matters alleged in sub-paragraphs 42(a), (b) and (c)."

"42. In response to The defendant does not admit paragraph 42 of the statement of claim on the non-admission basis. Amended Claim, the defendant:

(b) does not know, has no means of ascertaining and does not admit the matters alleged in sub-paragraphs 42(a), (b) and (c)."

"44. The matters pleaded in paragraph 43 strengthened Mr Churchill's belief about the matters pleaded in paragraph 42 above and his distress, depression, frustration, upset and anxiety about those matters."

"44. In response to paragraph 44 of the Amended Claim, the defendant:

(a) says that the Plaintiff's belief about the matters alleged in paragraph 42 of the Amended Claim is not relevant to the Plaintiff's cause of action against the Defendant in these proceedings;

(b) does not know, has no means of ascertaining and does not admit the matters alleged in paragraph 42."

"44. In response to paragraph 44 of the statement of claim Amended Claim, the defendant:

(a) does not admit the allegations on the non-admission basis says that the Plaintiff's belief about the matters alleged in paragraph 42 of the Amended Claim is not relevant to the Plaintiff's cause of action against the Defendant in these proceedings; and

(b) objects to the allegations on the irrelevancy basis does not know, has no means of ascertaining and does not admit the matters alleged in paragraph 42."

• [90] Both paragraphs 42 and 44 plead the plaintiff's belief about certain matters and in such circumstances the plaintiff's counsel acknowledges the difficulties in challenging the withdrawal of the deemed admissions in relation to these paragraphs:

"MR MAY: And can I accept that of the ones we challenge, these are the ones that I have the most difficult argument in respect of, they being allegations about my client's belief. The point I make about them is that the things that Mr Churchill alleges that he believed are, in many respects, things that follow from allegations elsewhere in the pleading which are admitted, and I've referred to that in my written submissions. Now, it is true, because these allegations about Mr Churchill's belief, that the only way to know for certain whether those allegations are true or not is by asking Mr Churchill, even then, what is truth and so on. But you can investigate the subject matter of the alleged belief to show contrary indications which would suggest that Mr Churchill couldn't have believed that, for instance. And the only point I make about 42 and 44 is that there's no evidence of that kind of investigation to identify things...

Arguably paragraph 42 of the defence does not contain a deemed admission because the defendant pleads: does not know, has no means of ascertaining and does not admit the matters alleged in sub-paragraphs 42(a), (b) and (c)."

• [91] Arguably paragraphs 42 and 44 of the defence do not contain a deemed admission because the defendant pleads:

"does not know, has no means of ascertaining and does not admit the matters alleged in sub-paragraphs 42(a), (b) and (c)."

• [92] The same can be said about paragraph 44 where the defendant pleads:

"does not know, has no means of ascertaining and does not admit the matters alleged in sub-paragraphs 42."

• [93] The direct explanation for the non-admission is that the defendant does not know and has no means of knowing.[7] However, even if they are deemed admissions, I will give leave for the deemed admissions to be withdrawn.
• [94] The evidence of Mr Gawthorne is, in essence, that there are no reasonable enquiries that the defendant can make. I accept this to be the case. Hartmann is not an authority that the defendant must make enquiries of the plaintiff's state of mind.
• [95] I will give leave for the deemed admissions in paragraphs 42 and 44 to be withdrawn.

"51. By about January 2016, the rate at which Mr Churchill wrote new life insurance business had decreased substantially from what it was prior to the ASIC Investigation."

"51. In response to paragraph 51 of the Amended Claim, the defendant:

(a) admits that the rate at which Mr Churchill wrote new life insurance decreased;

(b) does not know and does not admit the extent of the decrease; and

(c) insofar as it is alleged that the decrease was caused by the Undertaking Publicity does not know, has no means of ascertaining and does not admit that the decrease was caused by the Undertaking Publicity."

"51(b). otherwise does not admit the allegations on the non-admission basis. does not know and does not admit the extent of the decrease; and"

• [99] Arguably there is no deemed admission in paragraph 51(b) of the defence. The defendant admits that the rate at which the plaintiff wrote new business decreased and pleads that it does not know and does not admit the extent of the decrease.
• [100] In essence, the only matter in issue is whether the decrease was "substantial". The issue arises because the plaintiff has not pleaded such substantiality any further. Whether or not a decrease occurred which was "substantial" is subjective.
• [101] However, the defendant by not canvassing the particulars does not admit them, nor does he admit their relevance to the establishment of a cause of action or any part of it. As White J in Ballesteros v Chidlow No 2 explained:[8]

"[21] Not only need there be an understanding of the difference between material facts and the evidence by which they are to be proved but also material facts and particulars of those facts. Although particulars are part of the pleading and may be struck out for the same reason, r 162, it is a well-established principle of pleading that particulars are not to be pleaded to, Turnover v Bulletin Newspaper Pty Ltd [1973] HCA 60; (1974) 131 CLR 60 at 80 per Barwick CJ. His Honour said

"The defendant by not canvassing the particulars does not admit them, nor does he admit their relevance to the establishment of a cause of action or any part of it."

With that in mind para 6 of the statement of claim contained only one material statement of fact and that was that the plaintiff sustained personal injuries as a consequence of the motor vehicle collision. The enumerated injuries, as is the usual fashion in such a pleading, appear as particulars. The longstanding rule of practice that particulars are not to be pleaded to is an answer to any complaint which would seek to apply r 166(5). Even so, there are only three responses to the particulars 8.1, 8.2 and 8.6 which are denials without further elaboration. The other responses sufficiently comply with the requirement of a direct explanation."

• [102] However, even if paragraph 51 contains a deemed admission I would give leave to withdraw any deemed admission in paragraph 51 of the defence.
• [103] Paragraph 51 of the ASOC pleads that:

"By about January 2016, the rate at which Mr Churchill wrote new life insurance business had decreased substantially from what it was prior to the ASIC Investigation."

• [104] The particulars of this allegation identify that:

(a) in 2014 the plaintiff wrote 'approximately 200 new life insurance policies'; and

(b) in 2016 the plaintiff wrote 'approximately 10-15 new life insurance policies'.

• [105] In relation to paragraph 51 of the ASOC, Mr Gawthorne deposes in his affidavit the inquiries that have been made:

"158. At paragraph 51 of the ASOC, the plaintiff alleges that the rate at which the plaintiff wrote life insurance business decreased 'substantially', including with particularised reference to a decrease in meetings conducted and new business written when comparing his activities in 2014 and 2016.

1. The defendant admits that the new business written by the plaintiff was less in 2014 than it was in 2016.
2. In the course of preparing this affidavit, I am informed by Ms Choudhury, and believe:

(a) the defendant, via his financial advice business, was writing policies for multiple insurers;

(b) the defendant does not have all of the policies written from other insurers, and the defendant is only able to determine the 'new business' / new policies written with respect to it;

(c) from the policies that the plaintiff wrote for the defendant, the number of life insurance policies written decreased from 252 in 2014 to 16 in 2016."

• [106] Mr Gawthorne's evidence is that the new policies that the plaintiff wrote for the defendant decreased from 252 (in 2014) to 16 (in 2016). The plaintiff states that such a decrease is plainly substantial. Accordingly, the plaintiff submits that there is no real dispute about the allegation pleaded in paragraph 51 and the defendant should not be able to withdraw its deemed admission.
• [107] A decrease from 252 to 16 polices that the plaintiff wrote for the defendant, per se, is substantial. However, that is only part of the picture.
• [108] The plaintiff was also doing work for other insurers and, in such circumstances, the defendant does not know whether the plaintiff's new life insurance business had decreased substantially taking into account the other policies as the defendant does not know the quantity of such policies.
• [109] However, the plaintiff emphasises that there is no evidence that the defendant has made any inquiries with any of those other insurers about the quantity of policies that that the plaintiff was writing. The plaintiff refers to material which shows that the plaintiff was dealing with related entities of the defendant and yet, the plaintiff submits that there is no evidence that the defendant has made any inquiries with any of those other insurers about the quantity of policies that that the plaintiff was writing.
• [110] The plaintiff refers to an authority signed by the plaintiff which allows the defendant to collect his private information and disclose it to various people:

"Section 15: Privacy/personal information use and declaration

By providing your personal information you consent, acknowledge and declare that,

We can collect and use your personal information for the following purposes: to process your current and any subsequent transaction request, and to administer your policy;

For the above purposes we can collect your personal information from, and disclose it on a confidential basis to: our related entities; government departments and agencies; investigators; lawyers; advisers; and the agent of any of these; and

Where you provide personal information to us about another person, you are authorised to provide information to us, and that you will inform that person, (unless doing so would pose a serious threat to the life or health of any individual) who we are, how we use and disclose their information, and that they can gain access to that information.

In all circumstances where our contractors, agents and outsourced service providers become aware of personal information, confidentially agreements apply. Personal information may be used by our agents, contractors and outsourced serviced providers for our purpose.

I hereby declare that the information in this claim form is true, correct and complete.

I understand and agree that if I make any false or fraudulent statements or fail to advise ClearView Life Assurance Limited of any relevant information regarding my claim, ClearView Life Assurance Limited may refuse to pay, and cancel my claim."

• [111] In my view, such an authority signed by the plaintiff does not authorise the defendant to require other entities to provide material about the quantity of policies that the plaintiff was writing.
• [112] In relation to this issue, the defendant was limited as to the inquires they could make. I accept the defendant's submissions as to this point.

"MR DOUGLAS: .... We don't know the position in relation to the other insurers, and we don't have full disclosure from the plaintiff. Your Honour, it's one thing to say, "Yes, we should go and ask the other insurers", but we know one other insurer that may or may - only which - who may or may not be able to assist us. The problem the plaintiff advances is he doesn't plead his case in such a way which enables readily - ready response. One would've expected, perhaps, a proper plea would entail the plaintiff pleading, "Well, I suffered a reduction in this regard by reference to all of my insurance portfolios, including CommInsure, etcetera, etcetera. So my reductions for CommInsure was this much. My reductions for ClearView was that." It - it's an imprecise plea, and that's part of the problem for the plaintiff. The decrease acknowledged by the defendant in relation to life insurance policies written for it (252 down to 16) is plainly substantial."

• [113] Alternatively, the plaintiff submits that the defendant should at least be required to maintain so much of its existing admission as relates to writing new life insurance business with the defendant (or otherwise the specific reduction in new policies for the defendant from 252 to 16 policies) by way of an explicit admission in the proposed amended defence. I do not agree.
• [114] The defendant continues to plead in the proposed amended defence that the rate at which the plaintiff wrote new life insurance decreased. As to the specific reduction in new policies for the defendant from 252 (in 2014) to 16 (in 2016), there is no basis to require the defendant to plead an express admission. It is incumbent on the plaintiff to be more specific in its pleading of material facts.
• [115] In all the circumstances, I am satisfied that there is genuine dispute and give leave to withdraw the deemed admission in paragraph 19 of the defence.

"70. On or about 29 May 2018, or alternatively on or about 9 November 2020, Mr Churchill made a claim under the Policy for the IP Lump Sum Benefit (IP Lump Sum Benefit Claim).

(1) The IPD Lump Sum Benefit Claim was implicitly made by the TPD Benefit Claim.

(2) Alternatively, the IPD Lump Sum Benefit Claim was made by Mr Churchill in writing by a document titled `Submissions in response to preliminary assessment in relation to TPD Benefit Claim' sent by his legal representatives (Cooper Grace Ward Lawyers) to Ms Lee-Ann Barnard on about 9 November 2020, a copy of which is [GW.001.001.2861]."

"70. In response to paragraph 70 of the Amended Claim, the Defendant:

(b) says that the Plaintiff made the claim prior to March 2020.

(c) The Defendant acknowledged that the Plaintiff's application for potential entitlements to further monthly income protection payments to be converted into a lump sum TP payment in its letter to the Plaintiff dated 11 March 2020, re "Policy: Total and Permanent Disablement, Claim No 8295" (TPD Procedural Fairness Letter), first paragraph on page 1."

"70. In response to paragraph 70 of the statement of claim Amended Claim, the defendant:

(b) denies, on the denial basis, that the claim was made on 9 November 2020 because says that the Plaintiff made the claim was made prior to March 2020;

(i) The defendant acknowledged that the plaintiffs application for potential entitlements to further monthly income protection payments to be converted into a lump sum TPD payment in its letter to the plaintiff dated 11 March 2020, re "Policy: Total and Permanent Disablement, Claim No 8295" (TPD Procedural Fairness Letter), first paragraph on page 1.

(c) does admit that the claim was made on 29 May 2018 on the non-admission basis;"

• [119] Paragraph 70 of the ASOC pleaded that the plaintiff made a claim under the policy for the IP Lump Sum Benefit 'on or about 29 May 2018' or 'alternatively on or about 9 November 2020'.
• [120] The plaintiff states that the defendant's evidence does not identify what date it says that the claim for payment of the lump sum IP benefit was made. It simply asserts that 'it was prior to March 2020'. Accordingly, the plaintiff submits that there is no explanation in the evidence of the basis for the defendant's position on this issue or evidence of any inquiries made about the issue.
• [121] The point that the plaintiff makes about paragraph 70 (b) is that there is not an adequate explanation for why the defendant says positively that the claim was made prior to March 2020 but does not identify a particular date on which it was made; the defendant simply asserts that 'it was prior to March 2020'.
• [122] Accordingly, the plaintiff submits that there is no explanation in the evidence of the basis for the defendant's position on this issue or any inquiries made by the defendant about the issue. In such circumstances, the plaintiff submits that there is not a genuine dispute and the admission should stand.
• [123] Paragraph 70 of the ASOC is framed in the alternative as to when the plaintiff made a claim under the policy for the lump sum IP benefit:

(a) on or about 29 May 2018; or

(b) on or about 9 November 2020.

• [124] I note that the evidence in relation to paragraph 70 appears on the face of the material:

(a) "March 2020" emerges from a letter sent by the defendant to the plaintiff responding to the claim dated 11 March 2020; and

(b) there is a TPD benefit claim form of on or about 29 May 2018.

• [125] Particular 1 of paragraph 70 of the ASOC states that if the claim was made on or about 29 May 2018, then it was implicitly made by the TPD claim. Thus, the TPD claim form is asserted by the plaintiff to have a particular effect, namely an implicit effect, not a direct effect.
• [126] Accordingly, this is where the contest lies between the parties as explained by the plaintiff's submissions on this point:

"MR DOUGLAS: Implicit effect. Not as a direct effect. And that's the contest between the parties set up by the defence. Now, again, this is not something which is a revelation. We did plead in the existing defence to that document by reference to the later date of November 2020. What we didn't do was plead that, yes, you did make a claim in 2018 as you say you did, and we admit that, but we say it has a particular legal effect. Not the effect that you say."

• [127] In my view the defendant has raised a genuine dispute in relation to the effect of the TPD claim form. Such a dispute relates to the effect of various documents and policies as the defendant proposes, in lieu of the non-admission in subparagraph (c), to plead as follows:

(a) Admits that on or about 29 May 2018 the plaintiff made a claim for payment of the TPD benefit but says:

(i) him making a claim for such TPD benefit did not constitute, under the policy, the making of a claim for the TPD benefit Lump Sum Option;

(ii) nor does that fall to be inferred implicitly given that the TPD Lump Sum Option would result in the cessation of ongoing monthly IP payments, which payments the plaintiff continued to claim and receive until IP payments were refused in January 2020;

(iii) there was no indication within the TPD benefit claim form, including in the "Other Comments" section, of the plaintiff's intention to claim the TPD Lump Sum Option, resulting in cessation of IP benefits; and

(iv) pursuant to the terms of the policy, the opportunity to receive TPD Lump Sum Option benefits was not initiated by the claim made 29 May 2018, but rather by the plaintiff having satisfied the "Own Occupation TPD" definition, being made an offer by the defendant and with the plaintiff then confirming to the defendant that he accepted the offer in writing.

• [128] Accordingly, in such circumstances, evidence of further inquiries made by the defendant is not required for the purpose of withdrawing the deemed admission.
• [129] Particular 2 of paragraph 70 of the ASOC states that in the alternative the claim was made by the plaintiff in writing sent by his legal representatives on or about 9 November 2020. By reference to correspondence dated 11 March 2020, the defendant denies on the denial basis that the claim was made on or about 9 November 2020.
• [130] I note that in relation to paragraph 70(b) of the proposed amended defence, the fabric of the allegation pleaded in the existing defence concerning the date of making of an IP lump sum claim remains and serves as the explanation for the now formal denial contained in the proposed amended defence.
• [131] In all of the circumstances I am satisfied that there is a genuine dispute and give leave to withdraw the deemed admission in paragraph 70.

• [132] The defendant has been wholly successful in their application. However, as the defendant makes this application seeking an indulgence of the Court, the defendant accepts that they must pay the plaintiff's costs of this application for leave.

• [133] The order is as per the amended draft provided by the defendant.
  1. The applicant has leave to withdraw the admissions contained with paragraphs 1(b), 11(a), 11(b), 11(i), 11(k), 11(l)(ii), 12(a)(i), 13(a)(i), 13(c), 14(a)(i), 14(b), 16(c), 18(c), 19, 20, 22, 31(a), 33, 36, 38(b), 38(c), 38(d), 41(b), 42, 44, 46(a)(ii), 46(a)(iii), 47, 48(d), 50, 51(b), 51(c), 70(b), 73(b), 74, 75, 76, 77, 78(a)(iii), 78(b), 79, 80, 81, 82, 83, 85, 86, 87, 88, 89, 90 and 91 of the defence filed on 27 April 2023.
  2. The applicant pay the respondent's costs of the application to be assessed on the standard basis.

[1] DJ & MA Hose Pty Ltd ATF Hose Family Trust v Wide Bay Insurance Broking Pty Ltd ATF Wide Bay Business Trust [2022] QSC 191 at [44] - [48].

[2] Hanson Construction Materials Pty Ltd v Davey & another [2010] QCA 246 at [15] - [16].

[3] Hartmann v Pilkington & Ors [2012] QSC 254.

[4] Hartmann v Pilkington & Ors [2012] QSC 254 at [16] - [18], [20].

[5] Brisbane South Regional Health Authority v Taylor [1996] HCA 25; (1996) 186 CLR 541.

[6] Aimtek Pty Ltd v Flightship Ground Effect Pte Ltd [2014] QCA 294 at [8] (Holmes and Morrison JJA agreeing).

[7] See Aimtek Pty Ltd v Flightship Ground Effect Pte Ltd [2014] QCA 294.

[8] Ballesteros v Chidlow No 2 [2005] QSC 285.