43 The Plaintiff's application of 13 March 2003 contained information substantially similar to that in his application of 4 March 1997. He advised that since 23 July 1999 he had been entitled to a workers' compensation disability pension. He described his work with Gosford Electrical between 1 June 1981 and 15 March 1982 as spray painting, and with Tidy Car between 13 October 1982 and 1989 as car cleaning.
44 Mr Baker submitted that in light of all of the information before it the insurer's decision was unreasonable on a number of grounds. Firstly, it evidences an unreasonable failure to take into account the reports of Dr Foster. Dr Foster's description in his report of 23 October 1996 of the Plaintiff as a man of simple means who could only work as a labourer when read with the answers to questions 9 and 10 in his report of 18 March 1997 indicate that the Plaintiff's education, training, or experience enabled him to work only as a labourer, an occupation for which he was unfit. To enable him to work in some other occupation would require retraining. It was put that this opinion was given unambiguous emphasis in the report of 19 May 1998 in the passages quoted above (para 40).
45 Secondly, Mr Baker put that all of the medical information, when duly considered and evaluated, provides no support for the insurer's conclusion that the Plaintiff "… is capable of working in other unskilled light work such as the duties he was previously performing as a car detailer", or that car detailing was, in fact, light, unskilled work.
46 Mr Baker also submitted that there was no evidence whatsoever to support the belief that it was within the Plaintiff's physical capabilities to work as a car detailer. If such belief was founded on Dr Power's opinion in his report of 1 July 1997 it could only be the product of such a grave misunderstanding of what was said as to render the decision unreasonable.
47 For the Defendants, Ms Heath submitted, in short, that the decision to decline the claim was one reasonably open on the evidence. In particular, it was submitted that the finding that the Plaintiff was capable of performing car detailing was not inconsistent with the evidence as to his capacities within the range of restrictions considered. She further submitted that the work of car washing and cleaning is a matter of general knowledge for which no expert evidence is required and that, in any event, if the finding was in error it was not essential to the decision and did not render it unreasonable.
48 The evidence in the Plaintiff's applications, the employer's statements, and the return to work plan demonstrates that the type of work for which the Plaintiff was suited by reason of his education, training and experience was unskilled labour using both arms, which was repetitive work which required the ability to carry and lift heavy loads, sometimes above shoulder height. The medical evidence established to a high degree of probability that with the loss of full use of his left arm the Plaintiff was permanently unfit for work of this kind.
49 Dr Fuller's opinion was that the Plaintiff was permanently unfit for the type of employment he was doing whilst he worked at the sawmill. That was the very type of work he was suited to perform by reason of education, training or experience. Dr Nade's opinion left no room for doubt. He noted the Plaintiff was qualified to work as a labourer. His opinion was that he was unable to work in any job which required use of his left upper limb, and was fit only to work in some jobs which were "… right handed only". A reasonable reader would understand him to say that the Plaintiff was incapable of performing the type of work for which he was suited.
50 The medical opinions, including those of Dr Foster and Dr Htwe, are in substantial agreement that the Plaintiff is unable to do repetitive work involving the use of the left arm above the shoulder of the kind he was qualified to do.
51 The thrust of this evidence is that the Plaintiff is effectively unemployable as an unskilled labourer, and is thus unable to follow the occupation for which he is suited. He is not reasonably qualified for any other occupation. It shows that his injury has rendered the Plaintiff totally disabled for work as a labourer. Although he may be fit for light work involving only the use of his right arm, that is not what he is qualified to do.
52 In its evaluation of the evidence the insurer was required to address the question whether the Plaintiff had the capacity ever again to work in an occupation which he is reasonably capable of performing by reason of education, training, or experience. In my opinion the insurer's decision to decline the claim clearly reflects a failure to take into account that his limited education, training and experience was insufficient for any work of the kind which the medical evidence suggested he was physically capable of carrying out. The decision also reflects a failure to adequately consider whether, in the real world, work which required only the use of one arm and restricted use of the other was reasonably available for an unskilled labourer such as the Plaintiff. (cf e.g. Alessi v National Mutual Life Association of Australia Limited (1982) 2 ANZIC 60-481 at p 77,725-727; Muinos v Johnson & Johnson Retirement Benefits Limited, (5 December 1996, BC9605916) at pp 7, 8).
53 These failures are sufficient to hold that the decision was unreasonable. As a comment, had the decision been the verdict of a jury it would have been branded as perverse.
54 Furthermore, the terms of the letter give strong support for the finding, which I make, that the insurer's consideration of the question whether or not the evidence demonstrated that the risk covered by the policy had, in fact occurred was distorted by its groundless belief that the Plaintiff was fit to work as a car detailer. It is simply incorrect to represent, as the letter did, that the medical opinion was that the Plaintiff was capable of working in unskilled work such as the duties he was previously performing as a car detailer. In particular, it has no support from Dr Power's report. As earlier observed (para 29) his reference to the Plaintiff's work as a car detailer occurs merely as part of the employment history. His report could not be reasonably understood as suggesting the Plaintiff had a present capacity to do the same, or similar, work. I reject Ms Heath's submission that this finding was not essential to the decision. Having regard to the whole of the evidence before the insurer, the only rational explanation for the decision is that this finding was central to it.
55 For these reasons I find that the insurer's discretion was not exercised upon a real and genuine consideration of the range of material before it and, therefore, the failure to form the relevant opinion was unreasonable. Accordingly, I uphold the Plaintiff's challenge to the decision of 14 April 2003 and hold that the decision is invalid.
The decision of 7 November 2003
56 By letter of 27 October 2003 to the trustee the Plaintiff's solicitors applied for reconsideration of his claim for total and permanent disablement benefits, and interest. The letter and the Plaintiff's statements of 7 August and 21 October 2003 were sent by the trustee to the insurer on 30 October 2003.
57 The insurer considered this information and all of the material previously provided by the trustee in reaching its decision to decline the application. By letter dated 7 November 2003 the insurer informed the trustee of its decision in the following terms:
"We wish to advise that we have reviewed the details of this claim and on the totality of all the evidence we are unable to conclude that the member is totally and permanently disabled in line with the terms and conditions of this policy. Therefore, our decision to decline this claim remains unchanged".
58 The decision maker was one Mr John Kalfas, a senior consultant of the insurer. In his affidavit of 30 November 2004 he explained the decision thus:
"9. On all of the evidence then received by the Second Defendant in respect of the Claim I did not form the opinion that the Plaintiff was TPD in accordance with the definition in the insurance contract. While taking into account the Plaintiff's subjective view of the limitations on his capacity for work, I noted the restrictions for which he had been medically assessed were 'no heavy lifting' and 'no use of the left arm at or above the shoulder' and I considered on balance that all the evidence, particularly the medical opinion and radiological evidence, did not establish that the Plaintiff was unable ever to engage in work which he was reasonably capable of performing having regard to his experience as an unskilled manual worker. I also considered that the evidence established the Plaintiff could do light manual work and that he was reasonably qualified for that type of work by his past employment including car detailing".
59 In addition to the material in relation to the first and second claims, the evidence before the insurer was, relevantly, as follows:
60 The Plaintiff's statement of 7 August 2003 in which he said:
"6. I then gained employment with Tidy Car which was car detailing business and performed this work for seven years. My role was primarily to wash, wax, dry and vacuum to (sic) motor vehicles as well as other detailing and cleaning work. This type of work required quite a bit of heavy repetitive work involving both my left and right arms. I could not have performed the work using only my right dominant arm".
…
19. My symptoms have remained the same since approximately 1996, and I have constant pain in the outer aspect of my left shoulder which goes up into my neck and down into my arm and forearm.
20. The pain is constant which is made worse by any activity using my left arm, even very minor repetitive work.
…
28. I attempt to avoid driving a motor vehicle because when I turn my neck and leave my left arm on the steering wheel for a length of time, it causes me a lot of pain. As a result my wife usually drives if we travel any distance.
…
31. I have been a labourer all my life except for car detailing and the occasional spray painting. I would have difficulties performing car detailing at present because you have to use your left arm as well as your right arm as you need to work very fast. I would have difficulty in spray paining (sic) because you need to use your left hand to move ladders, sheets and other equipment whilst you are paining (sic) with your right arm".
61 In his statement of 21 October 2003 the Plaintiff gave details of his education, training and experience. He said that he was unable to do office and desk work by reason of his lack of experience and limited education. He said he had reservations about bar work because it requires staff to lift and carry racks of glasses, cartons of beer and spirits, and the stocking of shelves and performance of repetitive work using both right and left arms. He said that the same would apply to the position of a storeman or doing shop work. He also said:
"7. I also would not be able to perform farm work on a full time basis because of the physical requirements of mending fences, lifting bales of hay, moving stock, digging and other heavy work requiring the use of my left and right arms and neck. I have lived on a farm as stated in my previous statement and know that it is quite hard work".
62 Mr Baker submitted that the decision was unreasonable in that, in addition to the grounds relied upon for the challenge to the decision of 14 April 2003, it is apparent that the insurer ignored, or gave inadequate consideration to, the Plaintiff's statements as to the limited type of work he was reasonably capable of performing by reason of education, training or experience, and as to the nature of the duties required of car detailers, bar workers, storeman, or farm workers, and to the medical evidence which clearly demonstrated his inability to perform such duties. It was also put that implicit in the insurer's decision is that the refusal to form the opinion was based upon the erroneous belief which founded the second decision, namely that the Plaintiff was capable of performing duties of the kind required of a car detailer.
63 Ms Heath's submission in effect built upon the submissions made in support of the reasonableness of the decision of 14 April 2003. It was put that the additional evidence in the Plaintiff's statements as to his education, training and experience did not compel the insurer to form the relevant opinion, and thus it could not be said that the decision was unreasonable.
64 In my opinion the evidence requires acceptance of Mr Baker's submissions for the reasons given for my conclusion that the decision of 14 April 2003 was unreasonable. Furthermore, the Plaintiff's statements, uncontradicted, provided additional evidence which demonstrated that the decision was not reasonably open to a person who had given fair and genuine consideration to the material before him. Further, in my opinion, a rational consideration of the significance of the additional evidence would have inevitably led to the formation of the relevant opinion under cl (b) of the definition in the policy with the result that the claim should have been accepted.
65 Accordingly, I also uphold the Plaintiff's challenge to the insurer's decision of 7 November 2003, and hold that the decision is invalid.
66 Had the insurer formed the relevant opinion in response to the Plaintiff's application of 13 March 2003 it may be expected that it would have been acted upon by the trustee with the result that the benefit would have been paid, so that the Plaintiff would have had no need to make the application of 27 October 2003 to the trustee.
67 For the above reasons the Plaintiff is entitled to a declaration that the decisions of 14 April and 7 November 2003 are invalid. However, both parties requested the opportunity to make submissions as to the form of any final relief or orders after consideration of my reasons for judgment. The question of costs is also outstanding. In the circumstances it is appropriate that I direct the parties to make arrangements with my Associate by 25 February 2005 for the re-listing of the matter.
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