Mr Aaron Standley, the Plaintiff, sues Onepath Life Limited ("Onepath") in connection with a sickness and accident insurance policy that was issued to him by Onepath in 2008, which included cover for total and permanent disability ("TPD"). Mr R. de Meyrick of Counsel appears for Mr Standley and Mr G. Watson SC appears for Onepath.
Mr Standley made a claim for payment of a lump sum in September 2016: CB 239-245. The claim was formally rejected by Onepath in November 2017. Onepath has, however, been paying Mr Standley monthly payments from 2016 to date. It was agreed that that fact has no bearing on the outcome of this claim.
There is no dispute as to the terms of the Onepath policy. It provides that Onepath will pay "the full TPD Cover amount insured by the benefit payment type which applies" if Mr Standley suffers "total and permanent disability while the TPD Cover is in force and satisfies the conditions of the TPD definition which applies" (CB 272). The definition which applies is "Own Occupation" (CB 356) and the Own Occupation TPD definition, relevantly, is as follows (see CB 273):
"'Own Occupation' relates to the most recent occupation in which the life insured was engaged prior to the date of disability.
Own Occupation TPD means that, as a result of illness or injury, the life insured:
1. a. has been absent from and unable to engage in their 'Own Occupation' for three consecutive months; and
b. is disabled at the end of the period of three consecutive months to such an extent that they are unlikely ever again to be able to engage in their 'Own Occupation';
or
2. a. suffers at least 25% permanent whole person impairment as defined in the American Medical Association publication 'Guides to the Evaluation of Permanent Impairment', 5th edition, or an equivalent guide to impairment approved by us; and
b. is disabled to such an extent that, as a result they are unlikely ever again to be able to engage in their 'Own Occupation'."
I shall refer to this clause as the "TPD Definition" in the balance of these reasons, noting that only sub-cl 1 was said to be relevant.
On 2 August 2015, Mr Standley was injured whilst riding his motorcycle which collided with another motor vehicle (I shall refer to the motor vehicle accident as the "MVA"). He sustained injuries to his left wrist and two fractures to his right leg. The wrist injury involved a fracture and was put in a cast. There was a comminuted fracture of the right tibia. Mr Standley underwent surgery with an open reduction and internal fixation with plates and screws. He was in hospital for approximately five days.
At the time of the MVA, Mr Standley was employed as a Call Centre Manager for DHL Supply Chain ("DHL"), a parcel delivery service. DHL referred to the position as Customer Experience Manager ("CEM"). Mr Standley had worked at DHL only since June 2015.
Prior to working at DHL, Mr Standley worked in a similar role with Fastway Courier (from July 2013 to February 2015), as National Service Centre Manager for AAPT Telecommunications (from February 2012 to July 2013), as an Operations Manager for Tom-Tom Sales BV (from October 2007 to January 2012), as National Service Centre Manager for Chubb Security Services (from 2004 to 2007), and several other similar roles prior to that. Mr Standley had served four years in the United States Navy carrying out inspections related to aircraft and maintenance: see CB 178-184. He obtained a Certificate IV in Business Management from Meadowbank TAFE in 2003 and, based on a resume provided by Mr Standley (see CB 199), Mr Standley had other qualifications including a Bachelor of Science and Business Management from the University of Phoenix: see CB 202-203.
The evidence is that in October 2015 Mr Standley returned to work at DHL but was viewed by DHL as having insufficiently recovered from the MVA. He later recommenced at DHL in late October or early November 2015: see T37.1-3 (noting that the transcript incorrectly records "2016" as the year instead of "2015"). In February 2016 he resigned from the position. There is evidence from Mr Whiteford that he, a more senior manager at DHL, had said to Mr Standley in early February 2016 words to the effect of "I don't think it's working", reflecting the view that Mr Whiteford or his superiors had formed in late January or early February 2016: see T38.4-5.
Mr Whiteford's view was that although Mr Standley had made an enthusiastic and genuine effort to return, he was not, as at February 2016, coping with the work: T38.7-11. The respect in which Mr Standley was not coping and the reasons for Mr Whiteford's view were not explored in cross examination.
On 1 September 2017 Onepath wrote to Mr Standley through his lawyers providing Mr Standley with an opportunity to review the report prepared by Dr Chen of 14 September 2016 to QBE (one of the insurers dealing with one of Mr Standley's other claims arising out of the MVA), a report of Ms Jessica Cucchiaro of Assessability dated 28 June 2017 provided to Onepath and the "Role Profile" obtained from DHL (being the document at CB 27A and 27B). The letter at CB 253-255 also refers to an earlier report of Dr Davies (Mr Standley's general practitioner) and to Dr Chen's report. The letter states:
"While the balance of medical evidence confirms that Mr Standley has a degree of permanent impairment, it would seem it is not at a level that would render him totally and permanently disabled in performing his 'Own Occupation'.
We note from the recent claim forms submitted by Mr Standley for his income protection claim that Dr Davies has recently diagnosed him with secondary anxiety and depression. As treatment for this condition was only recently commenced we are unable to consider this condition as part of our TPD assessment until we have established Mr Standley's response to the treatment over a reasonable period of time.
Having regards to all the evidence that has been made available to us we are unable to admit a claim for a TPD benefit. We therefore invite you to review the enclosed reports and provide any further information you would like considered in the assessment of the claim.
Should you wish to provide a response or submit further information for us to consider, please do so within 21 days from the date of this letter."
Subsequent to the letter referred to above, Mr Standley's lawyers sent to Onepath the reports of Mr Theodosi, Dr Teoh, Mr Wright and Dr Takyar. In its letter of 15 November 2017 (at CB 256-258), Onepath noted receipt of those documents and that they had been reviewed. The letter continued:
"Our decision
The assessment of Mr Standley's TPD claim is based on whether he meets the TPD definition as at the date of assessment. According to the relevant TPD definition the date of assessment has been determined as 2 May 2016, being three months after Mr Standley ceased work.
The medical evidence we have obtained shows that Mr Standley's psychological illness was not present at the date of assessment and appears to have emerged as a secondary condition at a much later stage. This means that we are unable to consider Mr Standley's psychological illness as part of our assessment of his TPD claim until reasonable time to respond to treatment has passed.
Our assessment of Mr Standley's claim has therefore been based on his physical disabilities. The weight of the evidence obtained as presented to you in our procedural fairness letter dated 1 September shows that while Mr Standley has some physical limitations and a certain degree of permanent impairment, it would seem it is not at a level that would render him totally and permanently disabled in performing his 'Own Occupation'.
Having regard to all of the relevant evidence available to us, we are not satisfied that Mr Standley meets the definition of TPD."
Mr Standley's evidence (at paragraphs 22 to 29 of his Evidentiary Statement of 12 October 2018) is that:
"[22] After the accident and to date I have suffered persistent and severe pain in the right ankle and left wrist. Over time, I have also developed back pain, and left ankle pain, which I believe has been brought about due to my walking with a limp.
[23]… [I] could not cope with the work. I was in a great deal of pain and struggling with depression.
[24] The job involved me being on my feet for much of the day and I could not cope physically or mentally with work. As a result I reluctantly resigned from my job in about February 2016.
[25] Since the motor cycle accident, I no longer volunteer, I no longer scuba dive, and no longer shoot. My day to day activity is very limited. I can only walk short distances, stand for short period of times [sic] and sit for a short period of time. My right ankle, right knee, left ankle and left wrist constantly hurt. I have had back pain since the accident.
[26] I feel deeply depressed much of the time. I don't go out much anymore, and have withdrawn from close family and friends. I am not doing any of my pre-accident usual enjoyable activities of a social and recreational nature.
[27] I am now unable to concentrate. I feel overwhelmed, irritable, frustrated and unhappy.
[28] I feel physically tired all the time, sick and run down, headaches and muscle pains and I have sleeping problems. Since the anxiety and depression came on, I have lost 8 kilos.
[29] My motorcycle accident has not only destroyed my ability to earn but has also ruined my quality of life."
The relief claimed in the Statement of Claim is for damages for breach of contract and various declarations that, for example, Onepath failed to exercise its discretion in good faith and was unreasonable. There is an alternative declaration sought, namely that the matter be adjourned pending further consideration by the Defendant. The Statement of Claim pleads that Mr Standley served a completed claim form and that by letter it was wrongly declined in November 2017 and should have been accepted by Onepath. The date of the claim form is misstated in the pleading (it was dated 30 August 2016 and lodged in early September 2016) but nothing turns on that error. At the hearing the case focused on the damages claim rather than on the declaratory relief sought in the Statement of Claim. This is not a case in which a trustee stands between the insured and the insurer: see, for example, Hannover Life Re of Australasia Ltd v Jones [2017] NSWCA 233. Interest is also sought on the unpaid amount claimed.
In the claim form dated 30 August 2016 (CB 239-345) which Mr Standley submitted to Onepath, he was asked why he ceased work and he gave the answer:
"Constant pain in leg and wrist."
In the form he described his duties (at CB 241) as:
"Managing staff, walking and monitoring office, lifting packages, email, customer meeting, warehouse monitoring."
The last word was said to be "meeting" (see T58), but it is clearly "monitoring".
It will be observed that there is no reference in the claim form to Mr Standley being unable to walk, to back pain or to any psychological condition but, rather, constant pain in his leg and wrist. I asked Mr Standley at T29.15 why he had made no reference in the claim form to the matters to which he deposes in his first Statement and he said:
"I spent a long time in the military and I come from a different background, an age group where I just felt like I just had to push through and keep going, um, when I returned to work and it wasn't until I left after work things were deteriorating even worse and I went to see my physician, my GP, and he did an online or a screen test or question test to find out if I was suffering from any issues and that's how it turned out to be, sir.
Q. This form, you haven't really answered my question but I'll just put it this way, this form was lodged well after you left work, wasn't it?
A. Yes sir, it was.
Q. You finished in February 2016 or three months after that?
A. Yes sir.
Q. So this is well after you've left work but there's no mention of any psychological issues?
A. I just tried to push through it, sir--
Q. So why didn't you? You say you want to push through, you pushed through at work and you failed on your case?
A. Yes.
Q. You were no longer at work. You are making a claim on the insurer?
A. Yes sir.
Q. Why did your claim form make no reference to these things that you say you had?
A. At the time I didn't know I had them. At the time I was just pushing through my situation."
In support of his claim, Mr Standley relies on the following medico-legal experts:
1. Dr Ben Teoh's Reports of 10 April 2017 and 25 June 2019.
2. Reports of Victoria Road Physiotherapy (Mr Theodosi) dated 8 September 2017, 17 October 2017, 10 January 2019 and 4 July 2019.
3. Mr Adam Wright's Reports of 15 September 2017 and 24 January 2019.
4. Dr James Athanasou's Report of 23 December 2019.
5. Motor Accident MAS Certificate of Dr Ash Takyar dated 14 September 2017.
6. Motor Accident MAS Certificate of Dr Gliksman dated 26 June 2017.
The Defendant relies on the following medico-legal experts:
1. Dr Thai's Reports of 11 July 2019 and 2 December 2019.
2. Dr Kneebone's Reports of 10 July 2019 and 19 November 2019.
3. Dr Chen's Report of 14 September 2016.
4. Dr Atkinson's Report of 12 November 2016.
5. Ms Cucchiaro's Reports of 28 June 2017 and 10 October 2019.
Onepath also relies on a report of Dr Davies dated 6 September 2017.
Mr Standley has also brought a worker's compensation claim in respect of the MVA (see T15.46 - T16.26), for which he received an amount of $500,000, and he also received a pay out from another claim he made against the CTP insurer (see T13-T14), for which he received $900,000. Some of the reports to which I have referred above were obtained in connection with the other claims made by Mr Standley. Dr Gliksman, an independent Medical Assessment Service assessor for the State Insurance Regulatory Authority, assessed Mr Standley, as at 26 June 2017, as 11 per cent whole person impairment (as a result of the physical injuries) (see CB 93-99), and Dr Chen (who was retained by lawyers acting for one of the insurers) assessed him as six per cent (and unlikely to exceed 10 per cent) whole person impairment. A MAS Certificate in respect of Mr Standley's psychological injuries was given by Dr Takyar, a psychiatrist and independent MAS assessor, who assessed Mr Standley as suffering from "an adjustment disorder with mixed anxiety and depressed mood". Dr Takyar assessed Mr Standley as having nine per cent whole person impairment: see the certificate dated 14 September 2017 found at CB 92. Dr Takyar noted that "from a psychiatric perspective, his capacity is reduced to being able to work one or two days per week": see CB 92.
Dr Takyar stated at CB 89:
"Current and Proposed Treatment
He has been seeing his psychologist, Dr Adam Wright, for four months on a monthly basis, but had initially been seeing him weekly. As he is self-funding, he has had to reduce the frequency of treatment. He is receiving cognitive behavioural therapy. His general practitioner had prescribed alprazolam, but he found himself highly sedated and this was then changed to diazepam. He said that his general practitioner had encouraged him to consider an antidepressant but he told me that he was fearful and that he had completed his own research (perhaps online) and came to the conclusion that antidepressants might do him more harm. From a duty of care perspective, I encouraged him to seek the opinion of his general practitioner in more detail and to perhaps discuss this with his psychologist or see a psychiatrist if his general practitioner was encouraging of this."
Of the reports relied on by Mr Standley, there are no reports from any treating doctor. Indeed, Mr Standley has never attended for treatment on any psychiatrist, pain management specialist or rehabilitation specialist.
There is no dispute as to the nature of the physical injuries Mr Standley (who is left hand dominant) suffered in the MVA. There is disagreement as to what level of impairment he suffers from when expressed in terms of "whole person impairment" in respect of the physical injuries, and there is considerable disagreement in the expert reports as to the effect his physical injuries had on his ability to work, although the divergence can be explained to a significant degree as arising from the different assertions of what Mr Standley's role at DHL entailed.
Dr Guirgis, a surgeon retained by the Plaintiff's solicitors for medico-legal assessment in the MVA case, expressed the view (as at 21 December 2016, CB 47), based on Mr Standley's physical injuries and his job description (see CB 51), that Mr Standley's injuries "had rendered him permanently incapacitated for the type of occupation in which he was employed at the time of the accident" (see CB 51-52). Dr Guirgis had been told that Mr Standley's duties "involved prolonged walking, frequent negotiation of steps to go around the warehouse and supervise the forty workers under him." Dr Guirgis at CB 52 referred to an employability assessment report which stated the numerous abilities that Mr Standley retained. Dr Guirgis expressed some generalised comments but did not directly address the "abilities" or assert that Mr Standley suffered from a lack of them.
Dr Teoh's view, as at 10 April 2017, in relation to Mr Standley's psychological condition was that Mr Standley's presentation is consistent with a diagnosis of "Chronic Adjustment Disorder with Mixed Depressed and Anxious Mood (DSM-5 Diagnostic Criteria)" (see CB 58) and he assessed Mr Standley's whole person impairment as 17 per cent: CB 58A. Dr Teoh thought the condition was chronic and his prognosis poor because it had become chronic: CB 58. He assessed Mr Standley as fit for "suitable duties", but did not say what those were. Dr Teoh expressed similar views in a later report in June 2019, assessing Mr Standley as at that date as having a whole person impairment of 15 per cent: see CB 63-65.
Mr Wright, a clinical psychologist, assessed Mr Standley (as at September 2017) as experiencing Adjustment Disorder with Anxiety and Depressed Mood (CB 71). On 24 January 2019, he certified that:
"Aaron [i.e. Mr Standley] is continuing with therapy for the management of anxiety and depression relating to his car accident. He is currently unfit to carry out his usual occupation": see CB 72.
There are three reports of Mr Theodosi dated 8 September 2017, 17 October 2017 and 10 January 2019. The reports do not clearly set out what treatment was given by Mr Theodosi other than treatment in December 2017 (see CB 69, being the report of 10 January 2019) and probably a course of treatment in January 2016 for passive mobilisation massage and strength exercises for the right ankle and left wrist: see CB 67, being the report of 8 September 2017.
Until September 2017 (at least), Dr Davies was Mr Standley's general practitioner. He provided a report on Mr Standley dated 6 September 2017, in the following terms (CB 170-171):
"In response to your request of 24/7/17 I have reviewed the detailed reports provided to me and my own clinical notes enclose the following information;
1. Aaron last consulted me on 24/08/2017
2. Aaron reported continuing pain in both ankles and left wrist. He is able to walk 100m on level ground before needing to stop and rest. He will use a stick if planning to walk longer distances. He also reports being unable to type for long periods or manage loads greater than 1kg in his left hand. He reports anxiety which he feels is secondary to pain and for which he is seeing a psychologist. He is taking diazepam for anxiety and ibuprofen for pain. Aaron advised he was unable to any lifting > 1 kg, to walk more than 5 minutes, stand more than 20 minutes, sit more than 25 minutes or drive more than 30 minutes. He also reported being unable to do repeated bending activity for more than 30 minutes or to do any climbing.
3. Apart from the treatment outlined above Aaron is also consulting with Dr Medhat Giurgis, orthopaedic surgeon. Aaron advised me he was seeing Dr Giurgis on 31/08/2017 but I have not had any correspondence from that visit to date. I have not received any correspondence at all from Dr Giurgis apart from a statement dated 20/09/2016 indicating Aaron was permanently unable to perform the duties of his previous position. I have not received any information regarding a detailed prognosis or management plan for Aaron's leg or arm injuries.
4. Option 1; Customer Services Manager. Having reviewed the description supplied, Aaron should be able to perform the duties required, taking into consideration travel arrangements, workplace access and flexibility of workplace environment and duties consistent with limitations described in response 2 above. Aaron may also require additional input regarding rehabilitation and pain management.
Option 2; Call Centre Manager. Aaron should be able to perform the duties required with the same conditions listed for Option 1.
Option 3; Client Relationship Manager. Aaron should be able to perform the duties required with the same conditions listed for Option 1.
Option 4. Operations Manager. Aaron should be able to perform the duties required with the same conditions listed for Option 1.
5. In my opinion there are good prospects for Aaron to be able to perform these roles but he will require a structured return to work program, having been out of the workforce for some time. He may also require more intensive specialist care, including second opinions from orthopaedic surgeons sub specialising in hand and fool/ankle conditions.
6. Reviewing the statement provided by me on 17/10/2016 I am now of the opinion that treatment and rehabilitation options for Aaron have not been exhausted. Also it is apparent that Aaron's previous skills would allow him to return to functional work despite ongoing physical disability. Therefore he should not be considered totally and permanently disabled at this stage."
It will be observed that Dr Davies had, at the time of his report, seen Mr Standley as recently as 24 August 2017. Dr Davies also reports that Mr Standley is seeing a psychologist for anxiety and that Mr Standley believes the anxiety "is secondary to [his] pain". The report makes no reference to Dr Davies having recommended that Mr Standley take any medication that Mr Standley did not want to take (see, in contrast, Dr Takyar's note of what Mr Standley told him at CB 89), and there is nothing to indicate that Dr Davies had prescribed Mr Standley with "SSRI antidepressant medication" in March 2016, this being what Mr Standley told Dr Kneebone (see CB 131), which is also in contrast to what Mr Standley told Dr Teoh at CB 56 (i.e. that, as at April 2017, he had not been prescribed any medication). I should note that although there is evidence that other earlier reports were given by Dr Davies, these were not tendered by either side.
Dr Davies' report is not inconsistent with Mr Standley having suffered some psychological impact from the accident at some time before August 2017, but the report is not supportive of the contention that Mr Standley was in such a state that he could not return to work and it contradicts the proposition that he was, as at August 2017, unlikely ever to work again in his own occupation, even on the basis of the limitations Mr Standley described to Dr Davies. Dr Davies' report stands in contrast to the reports of Dr Takyar at CB 92 and Dr Teoh at CB 55, which deal with the position in September 2017 and April 2017 respectively.
Dr Chen, as at September 2016, described Mr Standley's condition as follows:
"In my opinion, Mr Standley is now fit for fulltime pre-injury duties as a Customer Experience Manager. The exercises for his right foot should eventually allow him to resume using his orthotics in his work shoes which should improve his comfort when walking around the office and factory. As he has resigned, this job is no longer under consideration."
Dr James Athanasou, a consultant in Vocational Guidance and Rehabilitation, expressed the view, as at December 2019, that, as a result of the injury suffered in the MVA, Mr Standley has:
"…lost the capacity to continue in his occupation as an operations manager and customer experience manager… He is not suited for work as: (a) customer service manager due to the 'physical aspect and emotional aspect of it… up-and-down… dealing with clients… travelling… typing'; (b) call centre manager as it is 'one and the same… data analytic component… can't concentrate like I used to'; (c) client relationship manager as he 'can't sit for more than 20 minutes'; and (d) operations manager as it involves the 'same components' as above (cf. Ms J Cucchiaro, 2019).
While he may have some residual capacity in theory, it is not at all clear that he will be able to exercise it meaningfully or realistically in a competitive job market. The full extent and duration of any residual capacity is really a matter for your specialist medical opinions": see CB 82.
Dr Kneebone, a psychiatrist retained on behalf of Onepath, diagnosed Mr Standley as presenting in July 2019 with:
"adjustment disorder with mixed anxiety and depressed mood although a differential diagnosis considered was that of a major depressive disorder, single episode of moderate to severe severity": CB 138.
In the report that Dr Kneebone provided, he retrospectively assessed Mr Standley as at 2 May 2016 in the following terms:
"In the light of the above, the author of this report can only provisionally diagnose Mr Standley as having an adjustment disorder with mixed anxiety and depressed mood as at the date of assessment on 2nd May 2016.
Such a diagnosis can only be made on the basis of Mr Standley's self report as there appears to be no medical evidence in support of Mr Standley's claim with regards to the date of onset of his psychological symptoms."
In a later report dated 19 November 2019, Dr Kneebone raised doubts as to the claim of total impairment based on Mr Standley's psychological condition. At CB 150 he said:
"Given the sedentary nature of Mr Standley's own occupation and the observations of Adam Wright together with the reasonable expectation that more assertive pharmacological treatment of Mr Standley's depressive symptoms by a psychiatrist with an interest in chronic pain and the enlistment of Mr Standley in a multidisciplinary pain management program would give rise to modest but significant improvement in his psychological symptoms and level of functioning, the author of this report formed the view that there was a real chance that Mr Standley would be able to engage in his own occupation albeit in all likelihood only on a part time basis prior to reaching normal retirement age on 8 February 2036."
(Emphasis added)
The reports of Dr Athanasou, Dr Teoh (June 2019) and Dr Kneebone were clearly not available to Onepath in 2017.
The following emerged from cross examination and re-examination of Mr Standley:
1. Mr Standley agreed that he has been walking to and attending the gym regularly and since the accident (T12.49-50 and T13.14-24), for between 30 minutes to an hour each time, but he said at the gym he does stretching exercises to keep his leg and arms "limber and mobile": T27.35.
2. He said that, since the accident, he has never at any time looked for work of any kind (T13), although he agreed that that would be an easy thing to do: T13.26-50.
3. He did not agree that he had a strong financial interest in not resuming work (T14.1-2) and in asserting that he was disabled from work (T16.20) or in exaggerating the extent of his injuries (T17.49), but at T19.28-30 he agreed that it was in his interest to emphasise that the DHL job involved physical activities.
4. He denied that he had "very consciously and very deliberately exaggerated the physical activities involved" in the DHL work: T20.5-9.
5. He said, when asked if the walk from his office to the boardroom (a distance of 10 metres) was less than walking two minutes to the gym, that it was "probably less time": T21.49 - T22.1. When I asked him why he said "probably" he retracted it and said he misspoke: T22.13. Mr Watson submitted that this was another example of Mr Standley attempting to deliberately exaggerate his limitations and the extent of physical work required of him at DHL.
6. He had told one of the Defendant's experts (Dr Thai) that he supervised 60 people at DHL, but he had told Dr Guirgis that he supervised 40 people, and he was cross examined about the "60 people" representation at T25.27 - T26.1. He said he could be managing anywhere between 30 to 60 people: T25.33-34. That range was not mentioned to Dr Chen, according to her report, as she writes that he managed a team of "60 people" (see CB 158), and Mr Standley's assertion is contradicted by Mr Whiteford's evidence, who said the highest number would have been in the "mid-forties".
7. Mr Standley was cross examined at T26.31 - T27.20 as to the absence of any reference to psychological injury in the claim form submitted to Onepath:
"WATSON
Q. Just on another matter, you may have heard while there was a discussion called the opening before you were called to give evidence, a discussion about a psychological injury. Do you remember that?
A. Yes, sir, I do.
Q. You know that your lawyers lodged a claim with OnePath asserting the grounds upon which you were entitled to this total and permanent disablement benefit. You know that, don't you?
A. Yes, sir.
Q. If I tell you - I can show you if you wish, but if I tell you that it does not even include any reference to a psychological injury, would that surprise you?
A. No, sir, it would not.
Q. That's because the psychological injury came on later.
A. (No verbal reply)
Q. Is that right?
A. I - I can't explain that, sir. The reason why I say that was, when I went back to work - if I may explain myself, your Honour?
Q. Could I just get you to answer my question: you accept, do you, your lawyers submitted a claim form to OnePath. Do you?
A. Yes, sir.
Q. I'll give you a date.
WATSON: It's in the book, your Honour, at p 246.
Q. They sent it in a letter dated 4 October 2016. Would you accept that for a moment?
A. Yes, sir.
Q. Nowhere in that claim form does it refer to any psychological injury or problem. Do you accept that?
A. Yes, sir.
Q. That is because no psychological injury or problem had manifested by that time. Correct?
A. Yes, sir."
In re-examination Mr de Meyrick asked him as to when he first noticed a change in his mood or state of mind: T28.15 - T29.11. At 28.40 - T29.11, in re-examination, there appeared the following exchange:
"DE MEYRICK
Q. My question, if you recall it, do you recall my question which was--
A. When--
Q. --when after the accident did you first start to notice a change in your moods or state of mind?
A. Shortly after the accident, sir. When I was in the hospital.
Q. When you went back to work you've explained under questioning from my friend some of the physical problems you recall experiencing. Do you recall experiencing any problems in terms of coping from a mental point of view?
A. I did, sir.
Q. What were those problems?
A. I wasn't sleeping properly, I wasn't focussing, I couldn't deal with my staff directly. I just felt so overwhelmed all the time. I didn't have that strong personality that I used to when I was managing people. I was on medication for the pain and that was causing some stress and anxiety as well. I couldn't move as fast as I used to. I just wasn't with it.
Q. You continued to feel like that after you stopped the work - return to work trial?
A. Yes sir, I did."
and I have previously set out at [14] above Mr Standley's answers to my questions at T29.15-47.
In his first Evidentiary Statement, Mr Stanley gave no details of the physical demands of his work: see CB 15-19 and T24.43 - T25.1.
Mr Watson drew attention to the fact that Mr Standley told only one of the experts (Dr Chen) that he continued visiting the gym after the accident, and he told Dr Teoh and Dr Thai that he had ceased going to the gym. I think that these omissions are relevant to Mr Standley's credibility as well.
Onepath strongly challenged the Plaintiff's assertion that, as at May 2016, he was disabled by reason of his physical injuries to such an extent that he was unlikely ever again to be able to engage in his "Own Occupation". Mr Watson's submission on Mr Standley's credit was that I should approach Mr Standley's evidence "with caution" (see T60.27) and should be "wary" of adopting his evidence because of matters of demeanour, inconsistency and unreliability: T62.45-47.
I did not find Mr Standley to be an impressive witness. Mr Standley was unwilling to admit that he had a financial interest in exaggerating the extent of his disabilities (see T17.43-49 and see T16.15), although he did later admit that it was in his direct financial interest to emphasise that his job at DHL involved physical activities: T19.27-30. He would not agree that he had received a lot of money from his CTP claim (see T14.37), saying he had received "some money", which it turned out was $900,000 (before expenses). Having admitted that he goes to the gym several times a week for between 30 and 45 minutes and walks there (a two minute walk, he said at T21.47), he was not keen to agree that a walk to the boardroom on the same floor as his office at DHL would take less than two minutes: T21.49 - T22.12. There were a number of non-responsive answers: see, for example, T15.30-34, T17.24-30 and T39.15-21. When asked by Mr Watson to give the name of his "treating orthopaedic surgeon", Mr Standley said "the last one I saw was I believe Dr Guirgis", although Mr Standley was referred to Dr Guirgis by his lawyers for medico-legal purposes rather than for treatment: T18.19-25. When faced with evidence from Mr Whiteford that contradicted Mr Standley's evidence that he often worked back late (see CB 22, paragraph 10, and also see T40-T41), Mr Standley asserted (T39.25 and CB 24C) that he took work home - something he had not asserted in his first two Evidentiary Statements, the second of which contained a detailed description of his work: see CB 22, paragraphs 8-10. None of the matters to which I have referred are of themselves determinative but, together and coupled with the evidence at T26.31 - T27.20, T28.40 - T29.11 and T29.15, the changing elements of his evidence through three Evidentiary Statements and the differing accounts given to medico-legal experts, I think there is force in Mr Watson's submissions on credit. I should note, however, that whilst Mr Watson challenged Mr Standley's veracity on matters to do with his physical limitations and his role as a CEM, he did not put to Mr Standley that he had lied to the medical experts and to the Court about his psychological condition, and I did not take Onepath to dispute that Mr Standley had, at least by September 2017, developed a psychological condition. This is an important matter the significance of which I shall return to later in these reasons.
It has been said that caution may need to be exercised in relying too heavily on inconsistencies recorded in doctors' clinical notes and reports (see Mason v Demasi [2009] NSWCA 227 at [2] per Basten JA), but where a party relies on a report that contains assertions as to what he has said, and where, as here, the assertions appear in more than one report and the plaintiff has not asserted that he did not say what is attributed to him, I think that the discrepancies are matters to be taken into account. Indeed, in relation to the number of employees that he supervised he extended the figure of 60 to "60 plus" in his third Evidentiary Statement and, according to Dr Thai, Mr Standley told him that his work at DHL required him to walk several kilometres a day: see CB 111.
Mr Whiteford, whose credibility was not challenged and whose evidence I accept, said in his Evidentiary Statement of 10 March 2020:
"[5] Mr Standley's duties in his role as Customer Experience Manager at DHL are accurately set out in a job description entitled 'Role Profile'. Mr Standley worked about 8 to 9 hours per day, between roughly 8.30am and 5.30pm. Annexed to this Evidentiary Statement and marked "EW-1" is a copy of the document entitled 'Role Profile'.
[6] During Mr Standley's employment with DHL, I was his direct supervisor and he reported directly to me. Mr Standley and I worked in the same building.
[7] The duties of Mr Standley's role were entirely sedentary and office based, being centred around management and staff coordination. His role was not physically-based, and he was not required to perform any manual work or any work in DHL's warehouse.
[8] When packages went missing in DHL's warehouse, it was the responsibility of the storemen who work in the warehouse to locate these packages.
[9] I do not recall any instance when Mr Standley attended DHL's warehouse to locate packages or otherwise.
[10] It was not part of Mr Standley's duties or job description to attend DHL's warehouse, let alone perform any work there.
[11] I do not recall Mr Standley being required to ascend and descend stairs on numerous occasions during a working day.
[12] I do not recall Mr Standley spending 50% of his time at DHL on his feet. It was not a requirement of his role. Mr Standley did spend a high percentage of his time outside his office but it was sitting with agents not standing. These matters are based on my actual observation of Mr Standley."
Mr Whiteford said that he did not spend much of his day observing Mr Standley but I am confident his recollection is more reliable than that of Mr Standley.
The CEM position, Mr Whiteford agreed, was one of high responsibility and a "fairly high-pressured job": T34.14-15. It involved supervising, at most, a team of forty or so people (T34.21-24) and not 30 to 60 as Mr Standley asserted at T30-35. The CEM was required to meet key performance indicators and "service level agreements" with responsibility for the team's performance and to do whatever it took to "get the job done": T34.50 - T35.1. The CEM had his own office with glass windows. The people he supervised were seated at desks outside and in front of his office, and Mr Whiteford was on the same floor, as was a conference room, a kitchen and toilet amenities.
In relation to the physical requirements of the work at DHL, Onepath has established, in my view, that Mr Standley's reporting to medical experts significantly exaggerated the extent of movement and physical exertion required. I accept Mr Whiteford's evidence that the job was essentially sedentary and did not require Mr Standley to perform any manual work, any work in the warehouse or to walk any significant distance. According to Mr Whiteford, when Mr Standley was outside Mr Standley's office dealing with agents, he was sitting with the agents not standing. The location of missing parcels was not the role of Mr Standley but of the storemen. Mr Standley was not required to ascend or descend stairs during the day and, if he did do so, it would have been infrequently. Mr Whiteford said he could not recall Mr Standley spending 50 per cent of his time on his feet and said that it was not a requirement that he stand: see CB 26, paragraphs 7-11. Mr Whiteford agreed that the job required Mr Standley to do what was necessary to fix problems but I do not accept Mr Standley's evidence that he spent 50 per cent of the time on his feet "rushing about in the warehouse", or that he had any need to be in the warehouse on a regular, or even infrequent, basis.
It appears that the vocational experts called by Onepath were not asked to consider the psychological aspect because Onepath's position was that, as at September 2016 when Mr Standley lodged his claim, Mr Standley was not claiming to be suffering from a psychological condition, and its position at the hearing before me is that the only focus of the Court should be on May 2016. Onepath emphasises the link between 1(a) and (b) of the Own Occupation TPD definition and the words "at the end of the period of three consecutive months."
There are four aspects of the evidence which make it difficult to accept Mr Standley's evidence that he did have psychological symptoms as at February or May 2016:
1. The absence of any reference in the claim form (submitted in September 2016) to reasons other than physical.
2. The first reference to such a condition being in the report of Dr Teoh in April 2017: see CB 55-59.
3. He has never seen a psychiatrist other than for the purposes of examination in relation to this or one of his other claims. He did consult with a psychologist, Mr Wright, but as at September 2017 he had attended only three sessions with Mr Wright (the commencement date for which is not identified).
4. His contradictory answers in the witness box, to which I have referred at [14] and 34 above, and particularly his admission that as at 30 August 2016 no psychological injury or problem had manifested itself: T27.14-20.
Dr Kneebone's report does provide an assessment as at 2 May 2016, which I have set out earlier. The doubt that led Dr Kneebone to express his diagnosis only in provisional terms was entirely justified for reasons that I have given above.
Onepath's position is that Mr Standley can only succeed in his claim if he can establish that, as at May 2016 (i.e. at the end of the three month period since he left work), he was unlikely at that time to ever be able to work as a CEM on a full time basis. Onepath accepts that an ability to work on a part time basis would be insufficient, but it contends that the only relevant date in respect of which the assessment must be considered is May 2016 - so that the only question is, was he at that date unlikely to ever work again full time as a CEM.
Mr de Meyrick put forward three answers to that contention. The first is that he submitted that if May 2016 were the date as at which Mr Standley's capacity for work must be assessed, the Court should find that Mr Standley was physically incapable of performing the role of CEM on a full time basis. Secondly, he submitted that although there was no clear evidence that the Plaintiff was suffering psychological impairment as at May 2016, the Court should find that he had such an impairment. The third response was that the insurance contract should not be read narrowly as Onepath contends - that is to say, Onepath is wrong to focus only on May 2016 and to ignore the material presented to it (and to the Court) which establishes that Mr Standley has been suffering from a psychological condition, in addition to his physical impairment, for some time.
Mr Standley must establish that there was, as a result of his injury or illness (not, for example, as a result of litigation in which he was involved) no real chance that he would return to his occupation as a CEM on a full time basis. It should be noted that, in considering work as a CEM, it is not necessary to restrict consideration only to the role at DHL.
In Wallaby Grip Ltd v QBE Insurance (Australia) Ltd [2010] HCA 9; (2010) 240 CLR 444 at [28], the High Court observed that it is for an insured to establish such facts as are necessary to prove that the loss in question is covered by the contract, and Mr de Meyrick accepted that the onus is on the Plaintiff to establish that he meets the requirements of "Own Occupation TPD". As noted earlier, however, it was accepted by Onepath that the relevant work as a CEM or similar is on a full time, not part time, basis: see T10.42-44.
The TPD definition, relevantly, requires that, as a result of illness or injury:
1. The insured be absent from and unable to engage in his own occupation for a period of three consecutive months.
2. The insured is, at the end of the period of three consecutive months referred to in (1), disabled to such an extent that he is unlikely ever again to engage in his own occupation.
I accept that in order to establish his inability to work in February to May 2016 and the unlikelihood, as at May 2016, of him being able to ever return to work in his own occupation, Mr Standley was able to lead evidence obtained later than May 2016 that expressed a retrospective view as to his condition. Nevertheless, Mr Standley is still required to establish that, as a result of illness or injury, he was unable to work as a CEM for the entire three month period during which he was absent from work and that, at the end of that three month period, he was unlikely ever to work again in his own occupation on a full time basis. There is no expert evidence that establishes that, as at 2 May 2016, Mr Standley was in fact suffering from a psychological condition and, for the reasons which I have already given, I do not think he has established that he was. In relation to the physical injuries and their impact, I am unable to place much weight on the medical assessments advanced on behalf of Mr Standley due to Mr Standley's exaggeration of the physical aspects of his employment, to which I have earlier referred. Ms Cucchiaro's reports support Onepath's contention that Mr Standley was in 2016 and 2017 able to work as a CEM. Dr Atkinson's assessment based on the reports she had been given was that Mr Standley possessed transferable skills (set out at CB 185-186) that would enable him to pursue roles as a customer service manager, call centre manager, client relationship manager or operations manager, notwithstanding his physical injuries. A report of Dr Thai, an occupational physician, expressed the view that Mr Standley was able to perform office based sedentary tasks and would have been fit for full time "suitable duties in an office based sedentary role within his education, training and experience as an operations manager": CB 118. None of the vocational reports relied on by the Defendant, it should be noted, were predicated on the existence of a psychological condition.
It will be apparent from what I have said above that I am not persuaded that Mr Standley was precluded, for all of the period from February to May 2016, by reason of the physical injuries sustained in the MVA and sequelae, from performing as a CEM on a full time basis and that he was unlikely ever to return to work as a CEM. I also am not persuaded that, during that period, psychological sequelae had developed.
In relation to the third issue, Mr Watson submitted that it involves a straightforward application of the contractual terms, requiring the Court to determine whether Mr Standley was, as a result of illness or injury and for three consecutive months, absent from and unable to engage in his own occupation and disabled "at the end of the period of three consecutive months to such an extent" that he was unlikely ever again to be able to engage in his own occupation on a full time basis - the phrase "unlikely ever" to be given the meaning ascribed to it in TAL Life Ltd v Shuetrim [2016] NSWCA 68; (2016) 91 NSWLR 439. Mr Watson contended that the contract of insurance requires the Court to focus on the position at the end of May 2016.
Mr de Meyrick accepted that Shuetrim governs the meaning of "unlikely ever". In that case, Leeming JA (with whom Beazley P and Emmett AJA agreed) said:
"[88] It seems clear to me that the headnote of White has caused some subsequent decisions to depart from what was applied in Beverley (as well as by White J herself in Wiley). Further, I accept TAL's submission that in most cases any attempt to express a likelihood in percentage terms will have merely the illusion of mathematical precision. I also agree with TAL's submission that the bracketed words in the TAL policy tell against the construction in the headnote. Those words confirm what flows from the ordinary meaning of the language of "unlikely ever", namely, that where there is a real chance that a person may return to relevant work, even though it could not be said that a return to relevant work was more probable than not, the insurer would not be satisfied that the definition applies. "Unlikely ever" is, in this context, much stronger than "less than 50%".
[89] What follows is this. To make an assessment of TPD, it is not sufficient for the insurer to be satisfied that it is more likely than not that the person will never return to relevant work. On the other hand, if there is merely a remote or speculative possibility that the person will at some time in the future return to relevant work, an insurer will not, acting reasonably and in compliance with its duties, be able to be satisfied that the person is not TPD. The critical distinction is between possibilities which are readily contemplatable even though they may not be more probable than not, and possibilities which are remote or speculative. A real chance that a person will return to relevant work, even if it is less than 50%, will preclude an Insured Person being unlikely ever to return to relevant work."
(Emphasis added)
If Mr Standley was not suffering from a psychological condition in the three months he was absent from work between February and May 2016, and if the physical injuries were on their own insufficient to prevent him from working, then, as at May 2016, he did not meet the criteria for TPD. In relation to Onepath's assertion that the only relevant date for assessment is as at May 2016, Mr de Meyrick contends that the clause is not to be read narrowly - that the assessment of whether Mr Standley is unlikely to ever return to work can occur at a later time. The form lodged in September 2016, he submits, is not given contractual force by the contract of insurance - and the insurer was wrong to ignore the medical evidence that establishes that, at least at a later time, the Plaintiff did meet the criteria of being unlikely ever to work again in his own occupation on a full time basis.
In my view, the words "at the end of the period of three consecutive months" have a precise focus - that is to say, the relevant date for assessment is at the end of the three months during which the insured has been absent from his own occupation as a result of illness or injury. It does not permit a date for assessment to be chosen long after the expiry of the three months. Indeed, "after" is not the word used but, rather, "at the end of". I do not think that there is any ambiguity about the clause or how it is to operate and, accordingly, I do not think that the contra proferentem principle has any role to play in this matter.
This leaves for consideration the further contention that the three month period does not have to commence on 2 February 2016: see T50.24-35. This argument is based on the following propositions:
1. He had in April 2017 and September 2017 been diagnosed with a psychological condition which prevented him from working full time in his own occupation.
2. Mr Standley had not as at September 2017 been working for three months.
3. He was not as at September 2017 ever likely to return to his own occupation on a full time basis, having regard to his psychological condition and his physical condition.
4. He had presented to Onepath reports which supported the contentions in (1) and (3) above.
The first proposition was not in dispute. In relation to the remaining propositions, Mr Standley did provide reports to Onepath of Dr Takyar, Dr Teoh and Mr Wright. Onepath did obtain a report from Dr Davies which undermined Mr Standley's claims, but at the hearing Onepath did not seek to establish that Mr Standley's claims as to his psychological condition in the second half of 2017 were fake or exaggerated or that he was able to return to full time employment as a CEM in 2017 and beyond, and, as I have noted, Mr Watson did not cross examine Mr Standley on these issues or make submissions on them - rather, Onepath's position was that Mr Standley's condition in 2017 was simply not relevant to the Court's determination, the focus of which should be, Mr Watson submitted, May 2016, consistent with Mr Standley's claim form and his pleading. That position may also have been influenced by the fact that the psychiatric report which Onepath obtained from Dr Kneebone, whilst unsupportive of Mr Standley's claim to be unable to work at all, did express the view that Mr Standley would "in all likelihood" be able to work only part time (see [32] above).
The final issue in the case thus narrowed itself to the question of whether the only date for assessment was May 2016, as Onepath contends, or whether a later date prior to Onepath's determination in November 2017 (or the commencement of these proceedings in December 2017) could be relied on by Mr Standley.
Mr Watson asserted that Mr Standley's case was founded on February to May 2016 as the period of three months that he relied on and that his claim form was based on that as well. The first two assertions of Mr de Meyrick to which I have referred are consistent with that approach.
It is, however, the contention that the three month period does not have to be February to May 2016 to which attention must be given, and paragraphs 7, 8 and 13 of the Statement of Claim are in the following terms:
"[7] As a result of the said injuries and/or associated conditions, the Plaintiff became unable to continue his employment with DHL Supply Chain, and ceased employment from about February 2016, and has not been employed since that date.
[8] Further the injuries and conditions referred to above and the resultant disabilities have, from about February 2016 and continuing, prevented the Plaintiff from engaging in or following his own occupation or any occupation for which he is reasonably suited by education, training or experience.
[…]
[13] On a true interpretation of the facts, the Plaintiff properly meets the definition of TPD under the Policy, such that his claim for the TPD benefit should have been accepted by the Defendant."
(Emphasis added)
The emphasised words indicate that the claim is that Mr Standley's inability to work was a continuing inability, so Mr Standley, contrary to Mr Watson's submission, is not prevented from maintaining that at some stage (at least prior to the commencement of these proceedings - i.e. December 2017) he was unable to work for a period of three months and that at the end of that period of three months he was unlikely ever to return to full time employment as a CEM. Although, as I have held, the TPD clause requires that the assessment of likelihood of return to work must focus on a date that is at the end of a three month period of the insured not having worked due to illness or injury, the clause does not in its terms limit the three months of inability to work to any particular period, and I am not persuaded that there is any reason to read into the clause any limitation on its scope.
Having regard to Onepath's position and the absence of any challenge at the hearing to Mr Standley's psychological condition as at September 2017 (and beyond) and its impact on his ability to ever return to work full time as a CEM, as well as the medical reports (other than of Dr Davies) which support his claims, Mr Standley has made out his entitlement to the benefit under the policy from September 2017.
It was agreed at the hearing that if the Plaintiff was successful I should grant the parties time to agree upon the precise amount of the judgment sum (particularly with regard to interest) and I will also hear the parties on the question of costs.
[2]
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Decision last updated: 01 July 2020