Q. Just stop there, are you saying you don't recall the circumstances in which the ticks were placed in the boxes at page 536 under the heading Health Details Part 1?
A. Sir, I am a bit tired, I am mixed up. I am not feeling very well at the moment. I can answer this, it's no problem but I am starting to have - "
44 At this point the plaintiff applied for an adjournment until next day on the ground that he was unwell. It was granted, by consent.
45 After resumption of the hearing next day, the plaintiff withdrew his evidence that he ticked boxes one to five of section L, and said he was lost, confused, and unable to concentrate when giving that evidence. On similar grounds, he withdrew his evidence that he had ticked the boxes in section M. He then said that before the questions in sections L and M were raised, he disclosed the accidents and details of his medical condition at which point Mr Buxton stopped and said he needed to speak to his office. These sections were not filled in. The plaintiff agreed that he wrote the handwritten letters and numbers in all other parts of the personal statement, but said that the ticks were not written by him. Initially, he said the ticks were already filled in when the document was presented to him (T p 174-175). He then said recollection was difficult, and suggested that some ticks were made by Mr Buxton, and some by him, according to the answer he gave (T p 177).
46 He said that at the conclusion of the meeting, when Mr Buxton took the documents away, only sections L and M of the personal statement remained for completion, and there had been no discussion of the questions in them.
47 Some time later, Mr Buxton returned with the documents, which the plaintiff signed, but did not read.
48 The plaintiff was cross-examined on his statement of 30 October 2006. It was prepared by his solicitor to provide Westpac with details of the circumstances in which information was disclosed prior to the issue of the policy. In it (par 3), the plaintiff said the occasion on which disclosure was made was in conversation on one of Mr Buxton's visits to the shop, after which Mr Buxton made a telephone call, but he did not pay attention to what was said. The conversation continued in which Mr Buxton said:
"Most likely your old injuries are not important. We can probably insure you. I will need to make some enquiries."
49 The statement records (par 5) that next day Mr Buxton came to the shop with some forms, including the application. It included:
"6. I may have signed the paperwork on that occasion, although I do not remember doing so. I can say, however, that all the paperwork had already been filled in by Chris Buxton. If I did sign anything, it was a document that Chris Buxton had already prepared.
…
10. Whenever I saw Mr Buxton, it was always at the shop. Whilst he spoke to me, I was making cakes, serving customers, and generally running my business. Mr Buxton told me that he did not have time to come to my home, and it was convenient to him to come to my shop."
50 The plaintiff was also taken to his affidavit sworn 17 September 2008. The account of the circumstances of the disclosure conversation and the making of a telephone call (pars 4, 5) was in similar terms to that in the statement. The account of Mr Buxton's return next day with the forms (par 8) was in similar terms to that in the statement. The affidavit included:
"9. I may have signed the paperwork on that occasion, although I do not remember doing so. I can say, however, that all the paperwork had already been filled in by Chris Buxton. If I did sign anything, it was a document that Chris Buxton had already prepared. At the time, I was at work. The shop was very busy. I was serving customers. I was talking to him while I was working.
He said:
'Ken, all the paperwork has been prepared. All that is left is a signature and away you go, the insurance will start. The money will come out of your account every month.'
He showed me the application form. He opened it to the position where I had to sign. He put it on the coffee bar in front of me. He gave me his pen. I saw that the paperwork had been filled in. I believed that Chris Buxton had filled it in. He did not read the document to me. I was too busy to read the document. He did not ask me to read the form. I trusted Chris Buxton. I felt he was my friend. He put his finger near the place where I had to sign. I signed the form.
…
13. Whenever I saw Mr Buxton, it was always at the shop. Whilst he spoke to me, I was making cakes, serving customers, and generally running my business. Mr Buxton told me that he did not have time to come to my home, and it was convenient to him to come to my shop."
51 The plaintiff agreed that by par 9 he intended to convey he had filled in no part of the application which he signed (T p 209). He accepted that at the times he made the statement and swore the affidavit he knew he had filled in parts of the application and personal statement in his own handwriting (T p 210). He accepted that the assertions that all the paperwork had already been filled in by Mr Buxton were wrong (T p 207, 215).
52 The following is a summary of Mr Buxton's evidence.
53 During 2000 to 2004 he was employed by Westpac as a business protection specialist to arrange insurance for medium to small businesses. His first meeting with the plaintiff was on 9 January 2002 at the patisserie shop at Liverpool when different types of insurance were discussed. During the meeting, in the plaintiff's presence, he telephoned the underwriter's hotline to ask whether the plaintiff was eligible for income protection. The advice that he was not so eligible without a 12 month trading history was explained to the plaintiff. Other types of insurance were then discussed and the meeting ended with agreement that Mr Buxton prepare a presentation for the plaintiff's consideration.
54 The next meeting was on 15 January 2002 at the shop. There was a brief discussion concerning available options, and a presentation was given to the plaintiff which contained examples of premium calculations.
55 The next meeting was on 29 January 2002 at the shop. Although the plaintiff was busy, there was a brief discussion during which the nature of cover required by him was agreed.
56 The next meeting was on 4 February 2002 at the shop for the purpose of attending to the documentation. Mr Buxton brought the form of application and the personal statement. Prior to the meeting some parts of the first page of the application had been completed by Mr Buxton and his assistant, Alison. These were the details of the policy owner in section A, and of the person to be insured in section C. The date was also entered where required. No other part of the document had been filled in prior to the meeting. The only matters completed in the personal statement prior to the meeting were the cover page details of the client's name, application number, and adviser's name.
57 The plaintiff and Mr Buxton sat down to deal with the paperwork. As the shop became busy the plaintiff excused himself from time to time to work. It was then arranged that they meet next day after hours at the plaintiff's Cowper Street home.
58 At about 6.30pm on 5 February 2002 Mr Buxton met the plaintiff at Cowper Street. He brought with him the application and personal statement. The plaintiff's wife and children were present. Mr Buxton sat beside the plaintiff in the lounge room, whilst the others went into an adjacent room.
59 No additional information had been included in the application since the meeting the day before. The plaintiff then provided details of the beneficiaries, and signed as required in section K. Mr Buxton ticked the third box in section L and the plaintiff signed as required. Section M, under the heading "Westpac Financial Adviser Section", was not completed as the information was not available. Section R was signed by the plaintiff.
60 Referring to the personal statement, Mr Buxton said that apart from his signature and the date no entry was in his handwriting. As they proceeded through the document he explained the questions to be answered. The plaintiff completed sections C, D, E, F, G, H, I and J.
61 Mr Buxton asked the plaintiff to complete section L and to raise any questions with him. He said the plaintiff ticked the "No" boxes in each case. He then asked the plaintiff to read through the questions in section M and answer "Yes" or "No", which he did. The plaintiff signed where required in sections Q and R, and completed the employment details in section S.
62 Mr Buxton said he was not told by the plaintiff that he had been injured in an explosion at BHP in 1990, or that he had suffered a back injury in 1993, or that he had suffered from phobias or a nervous condition, or had any form of medical complaint or prior history.
63 In cross-examination Mr Buxton said his purpose in telephoning the underwriter was to double check whether income protection was available for a "start up business" being a new franchise of a business which had a trading history. With reference to his log books he adhered to his evidence in chief that he visited the plaintiff at Liverpool on 4 February 2002 and at his house at "Fairy Meadow just north of Wollongong" (T p 277) on 5 February 2002.
64 He denied the plaintiff had told him of his injuries at BHP. He said the plaintiff told him that while he was working at BHP there was an explosion in the blast furnace, and he decided to leave not long afterwards as he did not think it was safe. The plaintiff told him that he received a redundancy payout and decided to start his own business. Mr Buxton rejected as false the proposition that, on 4 February 2002 whilst the plaintiff was filling out the personal statement at the shop, the plaintiff told him that he had injured his back in the blast furnace explosion, and also at the BHP conference centre.
65 Mr Buxton was cross-examined about a Westpac document headed "Privacy Consent - Underwriting", signed by the plaintiff on 21 February 2002. Its effect, inter alia, was to authorise Westpac to obtain information for assessing the application, including information about health or disability. He said it was normal practice to have the consent form signed at the same time as the application and personal statement were completed, following which the documents would be sent together to the underwriter at head office in the city. Mr Buxton said that in this case the consent form was out of stock and unavailable when he met the plaintiff on 4 and 5 February 2002. The consent form was sent to the plaintiff at the patisserie on 20 February 2002 and, as requested, it was returned next day to Westpac Business Direct, the administration centre at Concord. He said the documents were then sent together to the underwriter, and observed that without the consent form the application could not be assessed.
Consideration
66 The fundamental question is whether the plaintiff's evidence that he disclosed his medical history should be preferred to Mr Buxton's evidence that he did not. The resolution of the conflict turns on my findings about them as witnesses.
67 For the plaintiff it was submitted that his evidence that he told Mr Buxton of the explosion and his injuries on 4 February 2002 whilst he was filling out the personal statement should be accepted as truthful. Without being exhaustive, I have attempted to summarise what I understood to be the principal submissions.
68 It was put that the plaintiff acted honestly in giving the information in section G as to Dr Gupta's details and attending him for 18 years, and in section J as to details of height and weight, and in section K as to details of smoking and alcohol, such conduct being inconsistent with an intention to mislead the insurer, and amply supported his claim that he disclosed the relevant history. Similarly, it was put that by signing and returning the privacy consent form, which authorised investigation of his medical condition, he demonstrated the unlikelihood of non-disclosure to deceive Westpac.
69 Further, it was put that it was more probable than not that during the conversation in which the plaintiff referred to the explosion at BHP he explained the related injuries and phobia, and it was unlikely that what he said was limited to the version given by Mr Buxton.
70 It was submitted that Mr Buxton's evidence that on 9 January 2002 he made a phone call to see whether income protection was available to the plaintiff should be rejected as nonsense. It was put that, having regard to Westpac's underwriting guidelines, he would have known that such cover was not available, and as enquiry was unnecessary it was improbable that the call was made.
71 The plaintiff relied heavily on the delay between the time the underwriter received the privacy consent form on about 27 February 2002, and the issuing of the policy on 27 March 2002. It was put that the delay established the inference that the underwriter, after discussion with Mr Buxton, decided not to investigate the plaintiff's medical history after receiving the privacy consent form, a process which accorded with the date of the policy. The submission was as follows (T p 361 l 1 - 36):
"The delay, be it from 21st February to 27th, is one thing, but the delay from 27 February to 28 March, in our submission, is an unexplained delay, inconsistent with the guidelines, 24 hour turn around. Mr Van Heerden, a very experienced underwriter, said, at the worst, seven days for a cleanskin application.