Wheeler v FSS Trustee Corporation as trustee for the First State Superannuation Scheme

Introduction

1. The plaintiff, Ms Joanne Grindley Wheeler, was formerly a member of the New South Wales Police Force. She was medically discharged as hurt on duty from the Police Force on 2 February 2012. Ms Wheeler was unable to work from 21 September 2010.
2. It is common ground between the parties that, at the time she ceased to carry out her duties, Ms Wheeler suffered from post-traumatic stress disorder (PTSD) and major depressive disorder, as a result of a number of her experiences whilst a member of the Police Force. At the end of the hearing, it was also common ground that Ms Wheeler continued to suffer from the psychological illness that had caused her to be discharged from the Police Force, and that, at that time she was incapable of engaging in any work for which she was reasonably qualified by reason of education, training or experience.
3. In these circumstances, it is not necessary to set out the series of frightening and horrifying events that Ms Wheeler experienced, while a member of the Police Force. It is sufficient to say that, although it is tragic that as competent and committed a member of the Police Force as Ms Wheeler was has developed the serious psychological illness that she has come to suffer, as a result of her actions in the line of duty, a consideration of those events makes the outcome readily understandable.
4. Ms Wheeler was 36 years of age at the time when the second defendant, MetLife Insurance Ltd (the Insurer), rejected her claim. She had a remaining work life of 29 years, based upon a retirement age of 65 years.
5. Ms Wheeler was, at all relevant times, a member of the First State Superannuation Scheme (the Fund) of which the first defendant, FSS Trustee Corporation (the Trustee), was the trustee.
6. Under the terms of the trust deed governing the Fund, the Trustee was entitled to insure its obligations to pay benefits to members, and it did so by means of two insurance policies issued by the Insurer. The two insurance policies were respectively called Group Life Insurance Policy Document, and Group Life Insurance Policy Contract Blue Ribbon (collectively, the Policies).
7. On 8 May 2012, Ms Wheeler lodged a claim for total and permanent disablement (TPD) benefits with the Trustee. Shortly thereafter, the Trustee made a claim on Ms Wheeler's behalf against the Insurer.
8. Ms Wheeler claims to be entitled to a benefit of $170,100, under the Basic Cover Insurance, and $625,451, or alternatively $578,270, under the Police Blue Ribbon Insurance. Each of the benefits claimed is based upon Ms Wheeler's entitlement, both under the trust deed that constitutes the Fund, and the Policies, to receive benefits for being totally and permanently disabled within the meaning of those documents.
9. The Insurer concedes that if Ms Wheeler succeeds in these proceedings, she is entitled to be paid the amount of $170,100, and the alternative amount of $578,270. I am not sure whether Ms Wheeler has abandoned her claim for the greater sum of $625,451. I will leave this issue to be resolved after judgment, if Ms Wheeler succeeds in her claim.
10. By 11 June 2014, the Insurer had not made a determination on Ms Wheeler's claim, and on that date she filed the statement of claim by which these proceedings were commenced.
11. In essence, Ms Wheeler claimed that the Insurer had constructively denied her claim, so that the court should proceed to determine her entitlement to each of the TPD benefits that she has claimed.
12. The Trustee, on 17 November 2014, filed a cross claim, in which it claimed a declaration that its liability to Ms Wheeler for the payment of any TPD benefit be limited to the extent that it receives payment from the Insurer under the Policies.
13. The Trustee did not seek positive relief against the Insurer, to oblige the Insurer to pay to it any TPD benefits to which Ms Wheeler was entitled as a member of the Fund, notwithstanding that the Insurer had not determined the application made on behalf of Ms Wheeler for a period of over two years.
14. On 4 September 2015, a few days before the commencement of the hearing of Ms Wheeler's claim by this court, the Insurer sent to the Trustee a letter in which it stated that it had rejected Ms Wheeler's TPD claims, and set out its reasons for the rejection. This letter followed the Insurer having sent to Ms Wheeler, on 13 August 2015, what is generally called a procedural fairness letter, in which the Insurer outlined the effect of the material it had, both for and against Ms Wheeler's claims. The Insurer provided the material upon which it proposed to make its determination to Ms Wheeler with the letter. It gave Ms Wheeler 14 days to make any submissions in response.
15. On 7 September 2015, which was the first day of the hearing, the Trustee filed, by consent of the other parties, a notice of submitting appearance, in which it submitted to the making of all orders sought by Ms Wheeler, and the giving of entry of judgment in respect of all claims made, save as to costs.
16. The proceedings between Ms Wheeler and the Insurer have been conducted on the basis that Ms Wheeler is personally entitled to prosecute a claim against the Insurer, for an order that it pay the Trustee the amounts of the TPD benefits to which the Trustee is entitled under each of the Policies, in respect of Ms Wheeler's claim against the Trustee.
17. The Insurer accepted that, if the court finds that, at some point, the Insurer constructively denied Ms Wheeler's claim, or that its rejection of Ms Wheeler's claim is invalid, then the court should proceed to determine Ms Wheeler's entitlement itself; in the sense of determining whether the Insurer has become obliged to pay to the Trustee under the Policies the TPD benefits to which Ms Wheeler claims she is entitled as a member of the Fund. The Court of Appeal has recently decided, in TAL Life Ltd v Shuetrim; Metlife Insurance Ltd v Shuetrim [2016] NSWCA 68 (Shuetrim), at [188], that the Insurer's concession was sound, and if the court finds that its determination of Ms Wheeler's claim is invalid, then the court should decide whether Ms Wheeler is entitled to the TPD benefits.
18. Also on the first day of the hearing, the court gave Ms Wheeler leave to file an amended statement of claim. The effect of the amendments was to remove the claim against the Trustee, and the allegations of fact relevant to that claim, and also to delete aspects of the claim pleaded against the Insurer, which the legal representatives for Ms Wheeler evidently thought were surplus to her needs.
19. The Insurer was accordingly given leave to file a defence to the amended statement of claim. Relevantly, the Insurer asserted, in par 25 of its defence, that on 2 September 2015, it declined Ms Wheeler's TPD claim, and provided reasons for its decision by letter dated 4 September 2015.
20. This aspect of the Insurer's defence introduced a significant new issue into the proceedings. Formerly, the issues were whether the Insurer had constructively denied Ms Wheeler's claim, and if so, was Ms Wheeler entitled to the TPD benefits claimed, by reason of the obligation upon the Insurer to pay the amount of those benefits to the Trustee under the Policies. Now that the Insurer has determined Ms Wheeler's claim by rejecting it, there is the additional issue of whether or not the Insurer's rejection of the claim was invalid.
21. The introduction of this new issue obliged Ms Wheeler to further amend her statement of claim, which she did by leave granted on 9 September 2015. In substance, the effect of the further amended statement of claim is to maintain Ms Wheeler's claim that the Insurer constructively denied her claim, and that the court ought itself to determine on the evidence that she is entitled to the TPD benefits that she claims. Ms Wheeler now also claims that the circumstances in which the Insurer decided to reject her claim, immediately before the commencement of the hearing, constituted a breach by the Insurer of its duty to Ms Wheeler, so that the determination is invalid. Alternatively, even if the determination is not invalid because the Insurer did not act reasonably in making that determination, because of the circumstances and the timing in which it was made, the determination is nonetheless invalid, because it involved a breach of the Insurer's duty of good faith and fair dealing, and to act reasonably, in considering and determining the validity of Ms Wheeler's claim.

The Fund rules

1. As the Trustee has submitted to the order of the court, and as neither of the remaining parties has made any issue that requires any consideration of the rules of the Fund, it will not be necessary to consider those rules in any detail.
2. However, it may be noted that the rules define "insured benefits" in rule 23.1 as meaning "the amount payable to the Trustee from an insurance policy in respect of the death or disability of that member". Rule 11 relevantly provides: 11.1 The Trustee may acquire, hold, vary or dispose of one or more insurance policies to provide insured benefits for members. 11.2 The Insured benefit of a member is: (a) limited to the extent that the Trustee is able to effect cover under an insurance policy; (b) only payable to the extent that the Trustee receives payment from the insurer under an insurance policy.

The Policies

1. As I have noted above, Ms Wheeler has made claims under two insurance policies issued by the Insurer to the Trustee.
2. The first Policy is called Group Life Insurance Policy Document.
3. The only issue that arises under the first Policy is whether Ms Wheeler's claim falls within the definition of TPD in the definitions section of the policy wording, the relevant part of which (par (a)(ii)) reads: the Covered Person having been absent from their Occupation through Injury or Illness for 6 consecutive months and having provided proof to the satisfaction of us that the Covered Person has become incapacitated to such an extent as to render the Covered Person unlikely ever to engage in or work for reward in any occupation or work for which he or she is reasonably qualified by reason of education, training or experience.
4. There is no issue about whether Ms Wheeler was at the relevant time a Covered Person, or that she was absent from her Occupation as a member of the Police Force through illness for six consecutive months. The date for assessing Ms Wheeler's claim is accepted by the parties as being six months after 21 September 2010, which is 21 March 2011. That is the date at which the effect of Ms Wheeler's illness must be determined for the purpose of her claim for the TPD benefit under this Policy.
5. It will be convenient at this point to set out the term of the first Policy that deals with the making of claims under the Policy. 13. CLAIMS 13.1. The Policyowner must notify us in writing as soon as is reasonably practicable of an event entitling the Policyowner to a Benefit. 13.2. It is a condition of payment of any Benefit that the Covered Person provide us with such evidence to substantiate the claim as we may reasonably require. 13.3. The Covered Person must submit at our expense to a medical examination conducted by a Medical Practitioner or other health professional appointed by us as we deem necessary…
6. The second Policy upon which Ms Wheeler has based her claim is called Group Life Insurance Policy Contract Blue Ribbon. The criterion that must be established for eligibility to a TPD benefit under this Policy is set out in Item 6(b) of the First Schedule to the policy wording, which relevantly reads as follows: The Insured Member having been absent from their Occupation with the Employer through injury or illness for six consecutive months and having provided proof to our satisfaction that the Insured Member has become incapacitated to such an extent as to render the Insured Member unlikely ever to engage in any gainful profession, trade or occupation for which the Insured Member is reasonably qualified by reason of education, trading or experience.
7. While the wordings of the two TPD definitions are not identical, they are to the same effect, and raise the same issues in respect of their application, for the purposes of the present case.
8. I will also set out the term of the second Policy that deals with the making of claims: 7. CLAIMS 7.1. The Policyowner must notify us in writing as soon as is reasonably practicable of an event entitling the Policyowner to a Benefit. 7.2. The accuracy and timeliness of a claim investigation, and subsequent payment, will be diminished if we are not notified in writing within one year after the event giving rise to the claim. 7.3. It is a condition of payment of any Benefit that the Insured Member provides us with such evidence to substantiate the claim as we may reasonably require. The Insured Member must submit at our expense to a medical examination conducted by a legally qualified medical practitioner appointed by us as we deem necessary…
9. A number of aspects of these clauses may have significance in the present case. First, the TPD definitions in the Policies require the insured member of the fund to provide proof that the definitions have been satisfied to the satisfaction of the Insurer. These terms lie at the heart of the dispute, and the Insurer ultimately rejected Ms Wheeler's claim on the basis that she had not provided the necessary proof.
10. Secondly, the terms in the Policies dealing with claims appear to contemplate that the Insurer will carry out an investigation, and the fund member is required to provide such evidence to substantiate the claim as the Insurer may reasonably require. These terms are not inconsistent with the TPD definitions on their face. However, as will be seen, the manner in which the Insurer carries out any investigation that it undertakes may have a real and practical influence on the ability of the fund member to provide the proof required by the TPD Definitions.
11. Thirdly, the claims terms include provisions that deal with when claims should be made by the Trustee. In each case, the Trustee must notify the Insurer as soon as reasonably practicable of an event entitling the Trustee to a benefit. If the relevant event is a level of incapacity in the fund member that satisfies the TPD definitions, and if that event occurs at the end of the six months period of absence from work, then a question arises as to when it is reasonably practicable for the Trustee to notify the Insurer of that event. This raises subtle but important issues. In cases where the relevant injury or illness does not have a clear and immediate practical effect on the level of incapacity of the fund member, but it takes some time for the effect of the injury or illness to stabilise, and for the level of incapacity to become known, then the timing of the notification to the Insurer may have a significant effect on the Insurer being satisfied that the fund member is unlikely ever to be employed in work of the nature contemplated by the TPD definitions.
12. There is a further, practical issue that should not be ignored. The Trustee is the policy owner, and the Policies require the Trustee to make the claim, and for the fund member to provide the proof required by the TPD definitions. In reality, the manner in which Ms Wheeler's claim was made and determined was not consistent with what the Policies appear to contemplate; particularly in relation to her having to provide proof to the satisfaction of the Insurer that the TPD definitions were satisfied. The Trustee required Ms Wheeler to make a claim on it by filling out pro forma documents. Those forms did not require, or even make provision for, ample evidence of the incapacity suffered by Ms Wheeler, or the prospects of her gaining work over the remainder of her working life. The Trustee provided those documents to the Insurer, which constituted the making of the claim. The Trustee did not in any real way prosecute the claim itself. At most, the Trustee acted as a conduit between Ms Wheeler and the Insurer. The Insurer carried out the investigation to its own satisfaction. The Insurer required Ms Wheeler to cooperate in various ways to assist the Insurer to obtain the material that it thought was relevant. The Insurer felt no obligation to provide any of the material that it had gathered to the Trustee or Ms Wheeler until, shortly before it made its determination, it provided what is customarily called a procedural fairness letter to Ms Wheeler directly, which included all the material upon which the Trustee intended to act, and a summary of the information for and against Ms Wheeler's claim. It then offered to receive additional material from Ms Wheeler. While Ms Wheeler could, perhaps, have obtained her own material at any time during the investigation, the refusal by the Insurer to share the information that it had, inhibited the ability of Ms Wheeler to provide proof that was responsive to the material already in the hands of the Insurer. The Insurer then determined the claim made by the Trustee on behalf of the fund member. That happened only a short time after the delivery of the procedural fairness letter (in which Ms Wheeler was given only 14 days to respond). The insurer rejected the claim on the basis that Ms Wheeler had not provided adequate proof to satisfy the Insurer. That was so, even though almost all the proof was gathered by the Insurer, and Ms Wheeler had not been given any real or practicable opportunity to provide responsive proof.

Legal principles

1. The publication of the Court of Appeal's decision in Shuetrim has intervened between the completion of the hearing and the publication of my reasons for judgment in these proceedings. The decision settles one of the issues that was in dispute between the parties. That issue is the meaning of the expression "unlikely ever" in the TPD definitions, and in particular, the degree of probability involved in determining whether a fund member is unlikely ever to be employed in the manner contemplated by the TPD definitions.
2. As it has happened, these reasons were largely complete at the time the judgment in Shuetrim was handed down. I have revised these reasons where appropriate to accommodate the reasons in Shuetrim. The principles laid down by the Court of Appeal have not altered the decision that I had reached before the judgment was published.

The nature of the problem

1. It will be convenient to consider a number of practical issues that arise in this case, before the legal principles that are relevant to its determination are considered.
2. Ms Wheeler is a physically able person, who at present suffers from chronic PTSD and major depression disorder. As stated above, the medical evidence is unanimous that at the present time she is unable to work as a police officer, or in any other employment for which she is reasonably qualified by reason of education, training or experience.
3. Ms Wheeler had, at the date her application for TPD benefits was rejected, a remaining expected working life of 29 years. The issue of whether she is unlikely ever to engage in relevant employment depends upon the likelihood that her present psychiatric condition will change over the balance of her working life, in a way that now makes it sufficiently likely, in accordance with the true meaning of the term "unlikely ever", that she will be relevantly employed.
4. A number of features of Ms Wheeler's psychiatric disorders may be relevant to the proper determination of whether the TPD definitions are satisfied in her case. First, of course, her injuries are psychological and not physical. They are not immediately visible, except to the extent that they may be manifested by her behaviour. Realistically, there is a risk that persons who consider the consequences of Ms Wheeler's psychological disorders may be influenced, honestly and unintentionally, by societal attitudes to psychological disorders. Such disorders, if they are not manifested in extreme forms of conduct, may not appear to be real.
5. Secondly, as the evidence in this case shows, it may take considerable time, measured in years, before the level of incapacity caused by PTSD, with comorbid major depression disorder, stabilises in a way that permits qualified psychiatrists to determine whether or not the disorders are chronic, what the stabilised symptoms of the disorders are, and the likelihood that some improvement will occur over time, in a way that may give Ms Wheeler some capacity to engage in relevant work.
6. There was evidence that the literature shows that 30% of persons with PTSD become chronic sufferers of PTSD (T 143). This was not considered expert evidence, but it may be taken as indicative for present purposes. It follows that in a population of PTSD sufferers, some 70% may recover, although perhaps not without residual disabilities. As I understand the evidence, the question of whether a particular sufferer will recover, or whether that person's psychological illness will become chronic, can only be answered after the passage of time, after the person is given all available treatments but without success. The outcome is not readily predictable on an individual basis.
7. Consequently, if an expert psychiatrist is asked to give an opinion early in the course of the illness, the experience that only about 30% of cases become chronic might naturally cause the psychiatrist to say that there is a likelihood of recovery. However, if that statistical approach is applied to all PTSD sufferers, all will be said to be likely to recover, when in fact 30% of cases will not.
8. The problem therefore, is that a correct determination of whether the psychological injury of a particular PTSD sufferer is chronic may depend upon when the determination is made, in the course of a history of treatment that may take years. As the chronicity of the illness may only emerge as treatments continually fail, too early a determination of whether the illness is permanent may produce a false negative.
9. In the case of psychological illnesses of the nature suffered by Ms Wheeler, there will be a number of sources of uncertainty relevant to the application of the TPD definitions. The amplitude of the uncertainties may depend upon when they are considered. As I have said, at a particular time there may be uncertainty as to whether the illness has had time to stabilise, so that it can be known with reasonable confidence what the true extent of the incapacity is; whether there is any residual capacity for work; and whether there are prospects that future treatment or spontaneous recovery will improve the capacity for work. If there is residual capacity, or if there is some chance of recovery of capacity, there will then be uncertainty about the real prospects of the sufferer gaining relevant employment over the balance of his or her working life.
10. As I have noted above, Ms Wheeler ceased to work as a police officer on 29 September 2010, but was not discharged from the Police Force, as being medically unfit, until 2 February 2012. In the meantime, Ms Wheeler received psychological treatment, and medical investigations were undertaken, in order for a decision to be made by the Police Force as to whether Ms Wheeler was capable of continuing to undertake any of the duties of a police officer. Shortly after 2 February 2012, the Trustee provided to Ms Wheeler the forms necessary to make an application for the TPD benefits, in circumstances which invited Ms Wheeler to make the claim, if she thought that she satisfied the TPD definitions. The claim was made on 8 May 2012. Presumably, the Trustee took the view that it was not reasonably practicable to notify the Insurer that an event had occurred that might entitle the Trustee to a benefit, while it was still possible that Ms Wheeler might be capable of continuing to work as a police officer. Consequently, the timing of the application was temporally connected to a decision having been made that Ms Wheeler was incapacitated from continuing to be a police officer. However, there had not by that time been any comprehensive consideration of whether Ms Wheeler was permanently incapacitated from engaging in any other relevant occupation. There was therefore, no necessary temporal connection between the timing of the application and the stabilisation of Ms Wheeler's psychological disorders, which may be necessary to determine the true nature of her incapacity in relation to other forms of employment.
11. As I understand the expert medical evidence, the symptoms suffered by a person with PTSD and major depressive disorder are not constant, just like they are not always visible in the behaviour of the sufferer. The illness is in a number of respects insidious. It affects employability because it undermines the sufferer's cognitive capacity, reliability, sociability, energy and motivation, among other disabilities. It is possible for a person to suffer PTSD and major depressive disorder with symptoms that in fact entirely incapacitate them from engaging in any form of employment, but which do not have the result that they are entirely unable to engage in ordinary day-to-day activities, albeit intermittently and unreliably. Evidence of sufferers engaging in normal pursuits does not necessarily correlate with capacity to engage in employment. There is a heightened risk of error if the question whether a sufferer satisfies the TPD definitions is determined on the basis of evidence that would be suitable for physical illnesses or injuries. A more exacting approach may be required, if the applicability of the TPD definitions is to be determined accurately.

What are the insurer's duties?

1. In Shuetrim at [47] to [58], Leeming JA made a number of observations on the subjects of whether a member of a superannuation fund in Ms Wheeler's position is entitled to sue the insurer directly for relief to which the trustee of the fund is entitled; and also the nature of the duty owed by the insurer to the trustee. The latter issue raised the consideration of whether the duty owed by an insurer was in part a duty of utmost good faith, or a duty of good faith. As his Honour said at [58], it was not necessary for him to express a final view on these subjects.
2. The Insurer did not raise any opposition to Mrs Wheeler's claim that she could enforce the Trustee's rights under the Policies against the Insurer, and if successful, obtain an order that the Insurer pay the TPD benefits to the Trustee. The case was conducted on the basis that Mrs Wheeler was entitled to make the claim that she has made.
3. In her further amended statement of claim, at pars 30, 32 and 33, Mrs Wheeler dealt with the issue of the nature of the duty owed by the Insurer by alleging that the Insurer "failed to act with utmost good faith and failed to act in good faith and fairness and failed to act reasonably". Mrs Wheeler had, so to speak, a bet each way on the issue of whether the duty involved a requirement that the Insurer act with utmost good faith, or only good faith. Nothing was made of this distinction by the parties in these proceedings. As will be seen from the reasons that follow, I have adopted the description of the duty owed as requiring the Insurer to act in good faith and with fair dealing, and to act reasonably.
4. I have considered the duties imposed upon insurers in determining claims of the nature made by Ms Wheeler in Panos v FSS Trustee Corporation [2015] NSWSC 1217 at [148] to [154]. It will be sufficient to restate the following extract from the judgment of Santow JA in Hannover Life Re of Australasia Ltd v Sayseng [2005] NSWCA 214; 13 ANZ Ins Cas 90-123: 35. Turning to the challenge to Hannover's decision as insurer, the matter in issue on this appeal, the trial judge observed that when the decision of an insurer is challenged, while the grounds of challenge are generally similar to those applicable to trustees, the court proceeds to determine the facts should the insurer have actually failed to form the relevant opinion or have constructively failed to do so by proceeding on the wrong basis ([77] Red, 55M-S). 36. The nature and content of Hannover's obligations vis-à-vis Mr Sayseng were derived by the trial judge from the principles stated in Edwards v The Hunter Valley Co-op Dairy Co Ltd (1992) 7 ANZ Ins Cas 61-113 at 77,536. The relevant principles were said to be these ([81] Red, 57K-58Z): (a)There was an implied obligation on Hannover to consider and determine whether it should form an opinion on the matter which was a condition of its own liability; (b) That obligation involved consideration and determination of the correct question; (c) Hannover was under a duty of good faith and fair dealing which required it to have due regard for the interest of the claimants, meaning Mr Sayseng, as well as the Trustee; (d) Hannover was also obliged to act reasonably in considering and determining what its opinion was; (e) If the view taken by Hannover can be shown to have been unreasonable on the material before it, its decision can be successfully attacked; (f) If Hannover's decision is successfully attacked, the matter upon which its opinion was required becomes one for determination by the Court; (g) It has been held to be unfair for an insurer to act upon detailed and adverse medical reports obtained by the insurer itself without giving the claimant an opportunity to balance the report by obtaining a detailed report from a treating doctor, or giving the claimant a chance to answer the adverse elements in the report ([88], Red, 60L-O) citing Chammas v Harwood Nominees Pty Ltd (1993) 7 ANZ Ins Cas 61-175, Hodgson J at 78000 and 78001; Wyllie v National Mutual Life Association Ltd (Hunter J, 18 April 1997, unreported) and Beverley v Tyndall Life Insurance Co Ltd (1999) WAR 327 per Ipp J at [25], [33-37] and [84-95] and Malcolm CJ at [6], [12] and [13], [14] and [15]. Anderson J who agreed in the result of the appeal did not agree with this holding: see [97]-[98].
5. In Shuetrim, Leeming JA, with whom Beazley P and Emmett AJA agreed, said on this subject: [60] I do not regard the following as controversial. First, the clause does not turn upon the fact that the Insured Person is unlikely ever to undertake employment, but instead is expressed to turn upon the state of mind of the insurer. [61] Secondly, in considering the matter and reaching a state of satisfaction, the insurer is required to act reasonably. That has been worked out in a series of decisions dating from the mid-nineteenth century, to which McLelland J referred in Edwards v The Hunter Valley Co-op Dairy Co Ltd at 77,536: Where under a contract, rights or liabilities depend upon the subjective state of mind of a party, eg the party's approval, opinion or satisfaction, of or about something, it can be a difficult question whether the party is subject to an implied obligation in reaching that state of mind, or failing to reach it, as the case may be, to be bound by objective standards of reasonableness.... However in the field of insurance, it is well established that where under a contract of insurance an element of the insurer's liability is expressed in terms of the satisfaction or opinion of the insurer, the insurer is obliged to act reasonably in considering and determining that matter. [62] Thirdly, there are limits to what flows from the obligation to act reasonably. As McLelland J added: To say that an insurer must act reasonably in forming or declining to form an opinion is not to say that a Court can substitute its own view for that of the insurer. As North J pointed out in Doyle at 529, 'reasonable persons may reasonably take different views'. Unless the view taken by the insurer can be shown to have been unreasonable on the material then before the insurer, the decision of the insurer cannot be successfully attacked on this ground. [63] Fourthly, the words "proof to the satisfaction of us" reflect an obligation on the part of the Insured Person to provide evidence in support of his or her claim. [64] Fifthly, the clause does not turn on the insurer being satisfied that the Insured Person will never be able to resume employment, but the lesser threshold that he or she is "unlikely ever" to do so. The clause is thus more readily satisfied than the language in Manglicmot v Commonwealth Bank Officers Superannuation Corporation Pty Ltd [2011] NSWCA 204; 282 ALR 167 regarded by Giles JA as "quite emphatic": at [88]. [65] Sixthly, all of the foregoing is subject to the obligations of good faith on the part of the insurer, as well as the (overlapping) implied obligations to act reasonably and to do all that is necessary to enable the other party to have the benefit of the agreement (see Mackay v Dick (1881) 6 App Cas 251 at 263, Butt v M'Donald (1896) 7 QLJ 68 at 70-71 and Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 450), as set out in the passage in Edwards reproduced above.
6. A number of principles governing the issue of how the Insurer is to determine whether or not the TPD definitions have been satisfied, emerge out of a number of recent decisions of this court.
7. First, the requirement in the definition that the fund member provide proof to the satisfaction of the Insurer has the effect of "placing an evidential burden on the insured person": Shuetrim v FSS Trustee Corporation [2015] NSWSC 464 at [43] ff, and Ziogos v FSS Trustee Corporation [2015] NSWSC 1385 at [77] per Ball J. This is not the same thing as to say that the fund member has a burden of proof, as the process of determining claims is not the same as a judicial process.
8. Secondly, having regard to the terms of the Policies, the Insurer's duty of good faith and fair dealing does not require the Insurer to undertake its own investigations: Ziogos at [77].
9. Thirdly, as the onus is on the insured person to bring forward adequate material, an obligation arises from the duty of good faith and fair dealing for the Insurer to give the insured person a reasonable opportunity to bring forward that material: Ziogos at [78].
10. Fourthly, if (for example in the case of an unrepresented person) the insured person does not put forward sufficient material to enable the Insurer to address the substantive issues that it is required to address, then the duty of good faith and fair dealing would require the Insurer to say so, and to give the applicant an opportunity to put forward additional material: Ziogos at [78].
11. Finally, the Insurer's "statement of reasons for declining a claim should be understood as a practical document intended to inform the claimant of the basis of the decision rather than detailed reasons with reference to the evidence relied upon comparable to a judgment of a court or tribunal": Weber v Tiss Pty Ltd & Ors [2005] NSWSC 67 at [8]. While that is true, it is directed to the nature and complexity required of the letter informing the fund member of the reasons for the Insurer's rejection of the application. It does not obviate in any way, the need for the Insurer to comply with its duty of good faith and fairness, and to process and determine the application in a way that is reasonable in the circumstances.
12. As I have said, in practice, the way in which the evidence that supports the claim for the TPD benefits is gathered may not be entirely consistent with the expectation that the fund member will provide the proof. In practical terms, it may be the Insurer who controls and undertakes almost the whole of the investigation, and the fund member may be given relatively little opportunity to provide proof, in a convenient and effective way, to support the claim that the TPD definitions have been satisfied.
13. If the fund member, or the Trustee on his or her behalf, in fact controlled the process of proof, then the fund member could deal proactively with many of the problems that I have outlined above, concerning in particular, the timing of the application in relation to the stabilisation of the symptoms of the injury or illness, and the possible reduction in the level of uncertainty concerning the satisfaction of the TPD definitions that flows out of the assessment of the nature and duration of the incapacity, rather than out of the likelihood that a fund member with a particular level of incapacity will be able to engage in relevant employment in the future.

At what time must the TPD definition be satisfied?

1. The question arises as to the time as at which the test for the entitlement to the TPD benefit must be satisfied. The authorities appear to establish that the answer to this question is: where the TPD definition is in the terms applicable in the present case, as at the end of the six consecutive months of absence from work: see the decision of Brereton J in Halloran v Harwood Nominees Pty Ltd [2007] NSWSC 913 at [33], which was approved by Bathurst CJ in the Court of Appeal in Hannover Life Re of Australasia Ltd v Dargan [2013] NSWCA 57; (2013) 83 NSWLR 246 at [41] (the other four judges of appeal agreeing). See also Erzurumlu v Kellogg Superannuation Pty Ltd [2013] NSWSC 1115, and Folan v United Super Pty Ltd [2014] NSWSC 343.
2. Speaking on this subject, Stevenson J in Shuetrim v FSS Trustee Corporation [2015] NSWSC 464, said at [67]: An insured person cannot be TPD within the meaning of the MetLife definition unless he or she is absent from his or her occupation through illness or injury for six consecutive months. It is, in my opinion, implicit in the definition that such incapacity must arise from the injury or illness that caused the six month absence from work. The definition thus requires consideration of whether the incapacity results from that injury or illness. The TPD definition thus directs attention to the insured person's capacity, or lack of it, at the end of that period. That is, in my opinion, the time at which the insurer must consider whether the insured person is incapacitated in the manner called for by the definition. Otherwise, it would be open to an insured person to seek to satisfy the insurer, at any time after having been absent from work for six months, and perhaps many years later, that he or she was relevantly incapacitated by reason of the injury or illness that led to his or her absence from work.
3. According to his Honour, it is the insured person's capacity at the end of the period of absence that is relevant. I will call this time the "assessment date". If that were not so, it would be open to the insured person to claim many years later that he or she had become incapacitated in the manner required by the TPD definition, as a result of the injury or illness that had caused the absence from work, even though the insured person was not incapacitated in the relevant manner as at the end of the period.
4. As stated above, I do not understand the parties to the present case as having disputed the proposition that the issue is whether the TPD definitions were satisfied as at the assessment date. I note that the Court of Appeal in Shuetrim did not have to deal with a submission that the time at which the TPD definition was to be applied was not confined to the assessment date, "but extended to subsequent times": see Shuetrim at [155].
5. If the question of whether the TPD definitions have been satisfied is to be determined as at the assessment date, a subsidiary question is: what evidence concerning the level of incapacity of the insured person should be taken into account when the determination is made?
6. The answer to this question that has been given in previous authorities has now been clearly established by the decision of the Court of Appeal in Shuetrim, where Leeming JA said: [150] There can be no doubt that the medical and psychiatric opinions expressed in 2013 and 2014 were relevant to the consideration by TAL of the probability of Mr Shuetrim being able to return to work after July 2012. In McArthur v Mercantile Mutual Life Insurance at [74], Muir J said: Medical reports coming into existence after the relevant time will be admissible provided that they are pertinent to the determination of the appellant's condition at the relevant time. McMurdo P agreed with Muir J. McPherson JA also agreed with this aspect of Muir J's reasons, adding that it accorded with "the principle that the court does not speculate when it may know": at [23]. The primary judge relied upon that statement of principle. [151] More recently, the High Court's decision in Finch v Telstra Super Pty Ltd [2010] HCA 36; 242 CLR 254 at [18] is confirmatory of the position. Of a materially identical clause in a trust deed, the High Court said that the member was entitled to submit that: It can now be seen that the reason why I ceased to be a Telstra Employee was a state of affairs making it unlikely that I will ever engage in any gainful Work again. What matters is that that state of affairs arose while I was a Telstra Employee. It does not matter that the symptoms of that state of affairs emerged more clearly after I left Telstra's employment.
7. Leeming JA found, at [153], that TAL was in breach of its duty to act reasonably in determining the application because it based its failure to be satisfied only on material from around the date of assessment, being around the end of the period of absence of work, but it had not properly taken into account more recent material.

What is meant by unlikely ever?

1. The Insurer made the following submission (omitting footnotes): 55. There are a number of single instance decisions in which "unlikely" has been assessed separately, first, as being an assessment on the balance of probabilities. 57. As noted above, the genesis of this reasoning is the decision of White v Board of Trustees (1997) 2 Qd. R 659 per White J at 672, at which she considered the terms "unlikely" and "ever" separately and found: "The addition of 'ever' to the condition allows the Board to look well into the future but does not, in my view, affect the degree of unlikelihood to which regard must be had." 58. The effect of a disjunctive analysis is to lower the evidential onus on a Stage 2 assessment, and lower the level of satisfaction to the question of a probability. 59. [The Insurer] submits that to treat the words disjunctively so as to resolve the question of "unlikely" on the balance of probabilities is in error. [The Insurer] submits the use of the words "unlikely" and "ever" are conjunctive, and is not disjunctive. It is a composite phrase used in the commercial document.
2. The issue of principle has now been decided by the Court of Appeal in Shuetrim, in that Leeming JA 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. [90] I would reach this conclusion independently of authority, but note that it accords with what was said in Beverley by the Western Australian Court of Appeal. [91] To anticipate what follows, for an Insured Person to be unlikely ever to return to relevant work does not mean merely that it is more probable than not that he or she will not ever return to relevant work. The primary judge, understandably following what was stated in the headnote of White and in two recent first instance decisions, applied an incorrect test.
3. Given that the nature of the probability inherent in the expression "unlikely ever" has now been determined authoritatively, there is no need for me to consider the authorities that predate Shuetrim in any detail.
4. However, the issues that require determination in the present case make it necessary for me to consider a number of additional questions of principle.
5. The Insurer relied on the decision of Hallen J in Birdsall v Motor Trades Association of Australia Superannuation Fund Pty Ltd [2014] NSWSC 632 (which was upheld on appeal) at [124], as being an instance of a case where the word "ever" was treated merely as giving rise to an indication of the obligation to look well into the future. I do not accept that submission. Hallen J canvassed in a comprehensive way a number of authorities that dealt with the meaning of the expression "unlikely ever": see [109] to [118].
6. Apart from the now rejected proposition that "unlikely" required a probability of less than 50%, the authorities establish two propositions, which in my view, survive the decision in Shuetrim.
7. The first is that the word "unlikely" sets a much lower test than would be posed if an insured had to establish absolute incapacity: see Ivkovic v Australian Casualty & Life Ltd (1994) 10 SR (WA) 325, at 351, and Davis v Rio Tinto Staff Superannuation Fund Pty Ltd [2002] FCA 376; (2002) 118 FCR 170. Leeming JA repeated this proposition in Shuetrim at [64].
8. The second is that the court must consider the actual, or real possibility of employment, rather than a theoretical possibility: see Halloran v Harwood Nominees Pty Ltd [2007] NSWSC 913; Nile v Club Plus Superannuation Pty Ltd [2005] NSWSC 55; Jeffrey Guy Baker v Local Government Superannuation Scheme Pty Ltd [2007] NSWSC 1173; Sayseng v Kellogg Superannuation Pty Ltd [2003] NSWSC 945; Kenan Berk v Westpac Securities Administration Ltd & Anor [2010] NSWSC 28; Lazarevic v United Super Pty Ltd [2014] NSWSC 96; and Folan v United Super Pty Ltd [2014] NSWSC 343.
9. It will be sufficient to set out only the following extracts from the authorities as samples of the views expressed by the judges. In Nile, Brownie AJ wrote: [64] As Hodgson J pointed out in Chammas … one must consider not just the theory that someone is physically fit to do particular work, but also the actual likelihood of that person obtaining employment, meaning full time employment (or, I take it, substantially full time employment, generally comparable with the plaintiff's employment before his 1996 injury) that was reasonably open to the plaintiff. Given the plaintiff's education, training and experience, the prospects of his actually obtaining employment in any of the jobs suggested by Dr Innes-Brown were remote, and perhaps non-existent. … [65] The notion that some employer might employ him to do "clerical work" had to be reconsidered in the light of the plaintiff's affidavits, and one is left to wonder who might realistically be expected to employ him in that capacity, given his education, training and experience; and the proposition that he might be employed as a parking patrolman, standing and walking all day, is equally unpersuasive, given the plaintiff's statements in his affidavit, and the medical evidence.
10. I should observe that it is now established that permanent part-time employment may be sufficient: see Hannover Life Re of Australasia Ltd v Dargan [2013] NSWCA 57; (2013) 83 NSWLR 246.
11. Nicholas J said in Sayseng v Kellogg Superannuation Pty Ltd [2007] NSWSC 583 at [64]: The definition relates to disability to obtain future employment. It requires consideration of whether or not, on the evidence, it is probable that the insured would actually obtain work for reward (i.e. paid employment) for which he is qualified by education, training or experience, and whether his condition has disabled him from doing what he is qualified to do. The court is expected to take a realistic and common sense approach in its assessment. The application of the definition is directed to the realities affecting the capacity of the insured under consideration. It is not about theory. (Sayseng v Kellogg Superannuation Pty Ltd [2003] NSWSC 945, per Bryson J para 54; Ivkovic p 351; Nile v Club Plus Superannuation Pty Ltd [2005] NSWSC 55, paras 64, 65, 68).
12. The Court of Appeal did not expressly consider these principles in Shuetrim; they must be taken to continue to operate. Stevenson J, at first instance in Shuetrim [2015] NSWSC 462, restated these principles at [39], specifically by reference to the judgments in Nile and Lazarevic. The Court of Appeal did not make any adverse comment on this aspect of the judgment.
13. Leeming JA stated the effect of the expression "unlikely ever" in the following terms, at [89]: "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". A "remote or speculative possibility" is to be distinguished from a "real chance". There may be scope for debate about the relationship between Leeming JA's observations, and the principles that I have described immediately above. In my view they are entirely consistent, and are merely different expressions of the effect of the term "unlikely ever". Leeming JA focused on the degree of probability that is involved, while the judges in the authorities referred to above were concerned with what is required in the practical application of the "unlikely ever" test.
14. It is still necessary, in making a determination as to whether the TPD definitions are satisfied, to start with the medical evidence concerning the nature of the fund member's incapacity at the time of the determination, and the prognosis for recovery and improvement in the level of capacity. It is necessary to look forward from that date in a way that is real or practical, and not theoretical, and which has regard to the actual objective and subjective circumstances of the fund member. There will be many cases where the fund member has a residual capacity to undertake work, or a real chance of recovery, so that looking forward over a considerable number of years justifies a conclusion that there is a real chance that the fund member will obtain relevant employment. However, the decision in Shuetrim does not give licence, in cases where there remains a considerable number of years of potential working life, to an immediate focus on the length of the period and an intuitive assessment that there is a real chance of relevant employment, on the basis that anything might happen given a long enough time for it to happen in.
15. In practical terms, the application of the "unlikely ever" test, as explained in Shuetrim, is likely to be influenced substantially by two factors; being first, whether the fund member may have some residual capacity for relevant work at the time of the determination; and secondly, whether the symptoms of the injury or illness have had time to stabilise by the time the determination is made.
16. These factors have limited application in Ms Wheeler's case. First, the expert psychiatric evidence that was contemporaneous with the rejection by the Insurer of Ms Wheeler's application was that she was then incapacitated from all forms of employment, and at the time of the hearing the Insurer conceded that position. Consequently, in Ms Wheeler's case, she did not have some residual capacity that would justify an enquiry as to the likelihood that she would gain relevant employment during the balance of her working life. The question is whether, by further treatment or natural spontaneous recovery, Ms Wheeler will gain additional capacity. It is only if that question is answered positively, that there will be scope for considering the possibility that she will gain relevant employment. Secondly, although it took a number of years to happen, by the time the Insurer rejected Ms Wheeler's claim, some five years had elapsed since the end of the period of her six months absence from work, and Ms Wheeler's psychological disorders had stabilised in a way that enabled the reporting psychiatrists to conclude that her PTSD had become chronic, and her level of incapacitation was unlikely to change over the balance of her working life. Accordingly, the problem did not actually arise in the present case that the determination was made at a time when there was substantial uncertainty as to Ms Wheeler's prognosis, because her disorders had not yet stabilised.
17. Therefore, it is not, necessary for me in this case to consider the two factors to which I refer above in any detail.
18. I merely observe, in relation to the first factor, that it will usually be important to distinguish cases where the fund member is currently totally incapacitated from work, from those in which the fund member has some apparent residual capacity to engage in employment. In the former, the focus must be on the likelihood and consequences of any recovery of capacity. In the latter, the focus is likely to be on the likelihood, in a real and practical but not theoretical sense, that the fund member is capable of undertaking work within the relevant category, and is actually likely to obtain work of that nature.
19. In relation to the second category, a number of observations by Leeming JA in Shuetrim warrant note. It will be convenient to recapitulate the problem from above. Speaking generally, and no doubt simplistically, 70% of persons who suffer from PTSD are likely to recover, at least sufficiently to give them capacity for relevant employment. Thirty percent of sufferers are likely to become chronic, and may lose all capacity for relevant employment. If the determination of the fund member's entitlement to the TPD benefits is made early in the treatment process, a medical conclusion that the fund member has a 70% chance of recovery will clearly cause the fund member to fail the "unlikely ever" test. That will be so, even though 30% of claimants may in fact have a level of incapacity for employment that satisfies the TPD definitions.
20. Leeming JA, at [74], referred to a submission made by senior counsel for TAL in the following terms: [74] Mr Jackman SC also made the following submission: [I]n the particular context of our clause ... there is a further reason which doesn't appear in all of these definitional clauses to [prefer] the stronger view of no real chance and that is that the parenthetic words in our definition deal with the situation where a condition is unclear. Now, if something is unclear, then the scales are finely balanced and in those circumstances the insurer has the ability to defer assessment, but when the insurer comes to making the assessment, the way that our definition operates, it proceeds on an assumption that the condition is no longer unclear, that is it's clear one way or the other and if it's clear one way or the other, one then wouldn't construe 'unlikely' by adding the extra words in the sense of more unlikely than not. If it's clear, then there's no difficulty applying the test of no real chance, but there has been confusion in the authorities which seems to have been occasioned more by the head note and, perhaps, some of the reasoning of White J which at one point seemed to proceed on the basis that there wasn't a significant difference between the rightful formulations, but we would submit there is and her Honour was correct in the ultimate conclusion that was reached.
21. This submission was based upon certain wording contained in TAL's definition of TPD that is not present in the TPD definitions in the Policies. The relevant TPD definition was: …The Insured Person having been absent from their Occupation through Illness or Injury for 3 consecutive months (where the Insured Person's condition is unclear it is reasonable to defer assessment) and having provided proof to the satisfaction of us that the Insured Person has become incapacitated to such an extent as to render them unlikely ever to engage in or work for reward in any occupation or work for which he or she is reasonably qualified by reason of education, training or experience. (Emphasis added)
22. This TPD definition therefore expressly dealt with, at least to some extent, the problem of the fund member's condition being unclear at the date of the application for the TPD benefit. The definition contemplates that the assessment may be deferred until the condition has become clear.
23. TAL's submission was that, where the fund member's condition is unclear, and "the scales are finely balanced", then the insurer has the ability to defer assessment. If the assessment is then made, when the fund member's condition has become clear, then there is no difficulty in applying the test of no real chance. If it is right to say that the uncertainties involved in applying a particular TPD definition may include: first, uncertainty as to the nature of the incapacity; secondly, uncertainty as to prospect of recovery; and thirdly, likelihood of obtaining relevant employment with residual capacity, the TAL definition deals appropriately with the first of those uncertainties. If it be accepted that the real commercial purpose of the Policies is to give the TPD benefits to fund members who in fact are incapacitated in a way that satisfies the TPD definitions, then the TAL TPD definition removes an uncertainty that should not lead to the TPD claim being rejected.
24. Leeming JA responded to TAL's submission by saying, at [88]: [88] … 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%".
25. The head note referred to is the head note in the report of the decision of White J in White v The Board of Trustees [1997] 2 Qd R 659. It is not necessary to refer to that headnote. The point is that Leeming JA accepted TAL's argument that the bracketed words in TAL's TPD definition supported the submission that "unlikely ever" did not mean "less than 50%". That must involve an acceptance of the argument that, if the TPD definition contemplated that the assessment would take place after the condition, being the nature of the incapacity suffered by the fund member, has become clear, it was appropriate to equate "unlikely ever" to "no real chance".
26. Clearly, Leeming JA gave the same meaning to "unlikely ever" in the Insurer's TPD definition (which was in the same terms as the TPD definition in the Blue Ribbon Policy in the present case) as he gave to that term in the TPD definition in the TAL policy. The inclusion of the bracketed words was not essential to the conclusion that Leeming JA reached. However, it may be respectfully wondered what underlying assumption was made by Leeming JA as to the issue of whether the application of the TPD definition in the Blue Ribbon Policy permitted the assessment of whether the TPD definition was satisfied at a time when there was substantial uncertainty as to the level of incapacity caused by the fund member's condition.
27. One possible pointer to his Honour's view is an observation that he made at [111], in response to submissions concerning the likelihood of a return to work that would satisfy the TPD definitions: "…it might also warrant deferring the assessment date". This peripheral observation may support the proposition that in some cases, the assessment should be deferred to give at least a reasonable time in the circumstances for the level of incapacity suffered by the fund member to become as clear as possible before the assessment is made.
28. It is, of course, unlikely that all illnesses and injuries will neatly fall into a division that allows for a period in which it will be possible to determine the real long-term incapacity that is caused to the fund member, and then to separately consider the possibilities of partial recovery and residual capacity for work. Many illnesses and injuries will lead to substantial long-term uncertainty of outcome. The question will be whether the Insurer's duty of good faith and fairness to the fund member will require, in an appropriate case, that the Insurer defer the assessment of the fund member's complaint until there has been at least a reasonable opportunity for the condition of the fund member caused by the illness or injury to stabilise, at least to the greatest extent reasonably possible, to give a sound basis for the application of the TPD definition. That would involve an attempt to remove, as far as reasonably possible, the degree of uncertainty of outcome caused by uncertainty about the level of incapacity suffered by the fund member. It would lead to a conscious attempt to minimise the possibility that claims by fund members with genuine TPD are wrongly rejected, because of an irrelevant uncertainty as to the true level of incapacity as at the assessment date. Realism requires that it be accepted that these considerations would need to be applied at times when the claimant fund member is likely to be demanding as early an assessment of the claim as is possible.

Ms Wheeler's application

1. As stated above, the last day that Ms Wheeler worked as a member of the New South Wales Police Force was on 21 September 2010. Ms Wheeler was retired hurt from her employment on or about 2 February 2012.
2. On 5 March 2012, the Trustee sent to Ms Wheeler a number of forms and a questionnaire to be completed, in order for her to make her TPD benefit application. The letter contained the following: … After the insurer has conducted an initial review of the claim, it will advise what further information will be required to continue with the assessment. This may include obtaining a copy of any relevant workers compensation file, requesting further information from you or your employer and/or obtaining more detailed reports from one or more of your treating doctors. In some cases you may be requested to have one or more independent medical examinations. [The insurer will cover the cost of any information they request from third parties]… Please note that any decision made by an Insurer must be reviewed by the Trustee of the FSS before the outcome is advised to you. This is to ensure that the outcome is fair and reasonable and in the case of an accepted claim, to check the correct amount of insurance has been paid.
3. This instruction may reflect the terms of the Policies which dealt with the making of claims. I have set those terms out above at pars 28 and 31. As I have observed above, those terms contemplate that the Insurer will carry out an investigation, and that Ms Wheeler will provide to the Insurer such evidence to substantiate her claim as the Insurer may reasonably require.
4. While the fact remains that the TPD definition speak in terms of the insured person "having provided proof to our satisfaction", as a practical matter, the process of investigation appears to be governed by the claims term in each of the Policies.
5. Ms Wheeler made her application for the TPD benefit by completing by hand, the pro forma documents sent to her by the Trustee. She signed an application for payment of the disabled benefit, which was printed under the letterhead of the Trustee, on 8 May 2012. She also provided a medical statement, under the letterhead of both the Trustee and the Insurer, which was partly filled out by herself, and partly by her treating psychiatrist, Dr Selwyn Smith. That document was completed on 31 May 2012. On 8 May 2012, Ms Wheeler also completed a form called a statement of claim, under the letterhead of both the Trustee and the Insurer. It appears that the claim was forwarded by the Trustee to the Insurer on about 2 July 2012.
6. In response to Question 5 in the medical statement, being: "Please provide a summary of the patient's present condition including causes, symptoms and diagnosis", Dr Smith wrote, in the three lines made available: "Ms Wheeler has been exposed to a significant number of distressing and traumatic events causing her to significantly decompensate with symptoms of PTSD". His response to the question of what the patient's capabilities and limitations were was "Totally incapable" and "Totally limiting". He stated that Ms Wheeler was "Not likely to return to work". His comment in the space provided for "Other comments" was simply "Not capable of working".
7. On 12 July 2012, the Insurer wrote a letter to Ms Wheeler, in which it sought provision of certain information and authorities, and advised her that it would request information directly from Dr Smith, and Ms Wheeler's GP, Dr Doan.
8. On 2 August 2012, the Insurer wrote to Ms Wheeler requesting her to attend a consultation with Dr Richard Burek, for the purpose of his providing an independent psychiatric opinion to the Insurer.
9. On 17 September 2012, the Insurer arranged for Ms Wheeler to attend upon a senior rehabilitation consultant, on 16 October 2012, for the purpose of the Insurer being given a vocational assessment.
10. Then, on 19 November 2012, the Insurer arranged for Ms Wheeler to participate in a factual interview, to be conducted by Brooksight on 10 December 2012.
11. The Trustee wrote to Ms Wheeler, on 5 March 2013, requesting that she provide the Trustee with tax returns and notices of assessment for the years 2010 and 2011.
12. Instead of the Insurer requiring Ms Wheeler to put forward all of the material necessary to satisfy the Insurer that she had satisfied the TPD definition, as at the assessment date, it accepted an application based upon the completion of a number of forms, which required Ms Wheeler to provide very little information at all to support her application. Ms Wheeler was unrepresented by any lawyer when she made her application. Contrary to its entitlement not to make any investigations, the Insurer made nearly all of the investigations that were made.

Insurer's investigation of Ms Wheeler's claim

1. Before I deal with this issue, I will mention a number of matters that have affected my ability to determine why the Insurer's investigation proceeded in the manner in which it did.
2. First, the Insurer has not called evidence from any claims manager to explain the reasons for the course adopted by the Insurer. That may be the usual course in matters such as the present, but it does limit the ability of the court to work out what was really happening within the Insurer's office.
3. Secondly, the Insurer's file is not in evidence, in the sense of there being a sufficiently complete file to enable the court to be confident that it can understand what happened, when, and why.
4. Elements of the Insurer's file are in evidence; principally, the documents that the Insurer puts forward on the basis of an implication that the documents constituted the whole of the material that influenced the Insurer in making its determination. The assertion that that implication should be drawn is not supported by evidence. The evidence also includes documentary communications received and sent by the Insurer, in some cases being letters of instructions to experts for the provision of reports. However, the correspondence is disconnected from the claims material, so that it is not possible for me to reconstruct the file with confidence.
5. The Insurer commissioned its own psychiatric reports from two psychiatrists, shortly after it received Ms Wheeler's claim. One was Dr Selwyn Smith, who was Ms Wheeler's treating psychiatrist; who has seen her regularly from at least early 2011 to date; and who has provided a number of medical reports to various correspondents, as well as two reports to the Insurer.
6. The other psychiatrist was Dr Richard Burek, who has provided two medico-legal reports to the Insurer. Dr Burek only interviewed Ms Wheeler on one occasion, being 6 August 2012. Ultimately, the Insurer was not able to rely upon the evidence of Dr Burek for medico-legal purposes in these proceedings, because it discovered shortly before the date on which the hearing began, that Dr Burek was suffering from dementia.

Dr Selwyn Smith's reports

1. As disclosed in the Insurer's 13 August 2015 procedural fairness letter, the Insurer obtained from some source, I assume probably from the workers compensation insurer, a number of earlier reports prepared by Dr Selwyn Smith, which it relied upon in making its determination of Ms Wheeler's claim.
2. It will be convenient, for the sake of clear exposition, to deal with Dr Selwyn Smith's reports in chronological order, even though that will not reflect the order in which the Insurer received those reports.
3. In a report dated 24 March 2011, which was coincidently three days after the end of the six months, during which Ms Wheeler had been absent from work, Dr Smith reported to Allianz Australia Insurance Ltd: … Ms Wheeler in my opinion is not currently fit to work within the NSW Police Force. Ms Wheeler is currently not fit to work externally to the NSW Police Force. I do anticipate however that over time she will be able to engage productively in work outside the NSW Police Force. In my opinion Ms Wheeler's prognosis for returning to the NSW Police Force on pre-injury duties must be viewed as poor. This is in light of the chronicity of her symptomatologies… As stated treatment will not reintegrate Ms Wheeler into work with the police but will assist her in reintegrating into alternative work outside the NSW Police Force… (Emphasis added).
4. Dr Smith gave a report to Employers Mutual Ltd on 29 April 2011. He said: … I anticipate that her attendance at the Post-traumatic Stress Disorder (sic) will considerably assist in the amelioration of her Post-Traumatic Stress Disorder symptoms. It is difficult to be categorical in regard to Ms Wheeler returning to police Force duties following her attendance at the Counselling and Therapy Centre Post-traumatic Stress Disorder program. I would anticipate that she will be able to engage in alternative work shortly after the program has been completed. I am guarded in regard to her re-engaging at pre-injury duties. (Emphasis added)
5. It will be convenient here to interpolate reference to a report prepared by Dr Graham George on 29 August 2011, which was addressed to Employers Mutual Indemnity (Workers Compensation) Ltd. The reason for the interpolation is that Dr Smith responded to this report, in the next report that is considered below. Dr George diagnosed Ms Wheeler with having chronic PTSD, and major depression with anxious mood. He gave the opinion that Ms Wheeler was not capable of participating in employment and other life roles. However, in response to a question as to whether Ms Wheeler's symptoms were likely to improve with psychiatric treatment, Dr George responded: "Hopefully, her symptoms will improve with treatment". Dr George said that Ms Wheeler was not currently or in the future able to return to work as an operational officer within the NSW Police Force. Significantly, in response to a question as to why there had been no substantial improvement in Ms Wheeler's psychiatric condition since leaving work, Dr George responded: There has been some improvement in her condition, but often, in cases of post-traumatic stress disorder, a patient has to learn to live with ongoing symptoms over time. Often, full recovery does not occur.
6. On 23 September 2011, Dr Smith wrote a report to the NSW Police Force, in which he had been asked to respond to Dr George's report. Dr Smith said that he had re-examined Ms Wheeler on 21 September 2011. His report included: 1. I do agree with the recommendations following Dr George's examination and in particular that Ms Wheeler is unable to return to the NSW Police Force in any capacity… 3. In my opinion Ms Wheeler may be able to engage in work in the future outside the NSW Police Force. She previously worked in nursing but has no desire to reintegrate into nursing work. Exactly what other work she could do I am unable to advise you. (Emphasis added)
7. Dr Smith wrote a further report to Employers Mutual Ltd on 27 January 2012, which included: 3. Ms Wheeler may have the capacity to work in an alternative job and with a new employer. She does have qualifications as an enrolled nurse but has not worked in that field since 1998. She may require a separate vocational evaluation to determine what she can do. 4. Ms Wheeler should avoid police related activities in any future occupation. I would be supportive of further exploration in regard to her alternative work within the next few weeks. 5. I do believe that Ms Wheeler does have the capacity to participate in a vocational assessment with an approved rehabilitation provider in order to establish a new return to work goal… (Emphasis added)
8. On 1 May 2012, Dr Smith wrote a letter to Strategic Rehab Solutions, which prepared a vocational assessment report, dated 10 April 2012, for Employers Mutual Ltd. The report found that Ms Wheeler was capable of working in six occupations, which were said to be suitable by reference to her training, experience and qualifications. The Insurer relied upon this vocational assessment report, when it decided to decline Ms Wheeler's application. Dr Smith said: In general she would be able to undertake all the options you have suggested. I would however exclude her from undertaking work as an investigator or engaging in security or working as an insurance investigator as these would in all probability be difficult for her in the light of the previous adverse experiences with the NSW Police Force. You should be advised that Ms Wheeler continues to experience psychiatric symptomatology of significance and may not be able to participate in such work. A trial job option may be in order. (Emphasis added)
9. These series of reports reflected Dr Smith's professional understanding of Ms Wheeler's capacity, and her ability to undertake work outside the NSW Police Force, at the time when he was requested by the Insurer to provide it with a report.
10. Dr Smith's final word was that he thought that "in general", Ms Wheeler would be able to undertake some of the work options identified by Strategic Rehab Solutions, but she "may not be able to participate in such work". He suggested that a trial job may be in order.
11. These reports were all prepared in the year after the assessment date. It is reasonably clear that, on the basis of the evidence that was then available, the incapacity caused to Ms Wheeler by her PTSD did not appear to satisfy the TPD definition.
12. The Insurer wrote a letter of instructions to Dr Smith, on 12 July 2012, which materially asked: We refer to the claimant's Total & Permanent Disablement claim with [the Insurer] To assist us in assessment of this claim, it would be appreciated if you could provide us with the following information… 2) What is the current psychiatric diagnosis? Would you please express this in DSM IV terms and make some comment as to the severity of this condition? 3) Please outline the specific criteria satisfied to make this diagnosis… 5) Would you please outline your management plan including treatment, frequency of appointments (please provide dates), treatment, medication and dosages. 6) What alternative strategies would you consider should the current management plan be unsuccessful? 7) Which symptoms are preventing the claimant from returning to work and why? 8) What is the claimant's current work capacity? 9) Your short and long-term prognosis including the likelihood of return to previous work responsibilities in either full or partial capacity. 10) Are there any other factors which you believe may be contributing to or perpetuating this condition (e.g. relationship, family, medical, substance abuse, personality issues or financial problems). 11) Is the claimant's condition stabilising/deteriorating/improving? … The information we are requesting is for the primary purpose of the assessment and investigation of this claim…
13. Dr Smith provided a report to the Insurer on 31 July 2012. Dr Smith gave the following psychiatric opinion: It was my opinion following my initial examination that Ms Wheeler demonstrated diagnostic criteria for a Post-traumatic Stress Disorder in association with heightened levels of anxiety and depression… She has remained under my clinical care. In the light of her ongoing symptomatologies it was my opinion that Ms Wheeler could not engage in productive work with the NSW Police Force and it was against this background that I supported her discharge on medical grounds, hurt on duty. This was accepted.
14. Dr Smith evaluated Ms Wheeler, from a DSM-IV perspective, as having chronic PTSD and major depressive disorder, and that her current condition was moderately severe.
15. Relevantly, in response to the Insurer's questions 8, 9 and 11, Dr Smith answered: 8. In my opinion Ms Wheeler is currently incapacitated for work. 9. In the short-term her prognosis must be viewed as poor. She may in the future return to alternative work. As stated however at the present time this is not possible… 11. Her condition in my opinion has stabilised. (Emphasis added)
16. Significantly, Dr Smith advised the Insurer that Ms Wheeler's condition had stabilised; that she was not currently capable of working as a police officer, or in doing alternative work, but she "may in the future return to alternative work". Dr Smith did not develop his opinion in relation to the likelihood of Ms Wheeler becoming capable of doing alternative work, by considering the circumstances that might lead to an improvement in her psychological condition, and the likelihood of that occurring. He provided no opinion concerning whether there was a real chance of Ms Wheeler being able to engage in relevant work, or whether that possibility was only remote or speculative.
17. It may be noted that the Insurer entirely failed to ask Dr Smith, as the treating psychiatrist, what the likelihood was of Mrs Wheeler gaining work in the future in some avenue of employment other than her previous work.
18. Over one year later, on 9 September 2013, Dr Smith provided a psychiatric report to Ms Wheeler's solicitor. A significant part of this report repeats what Dr Smith had already said in his earlier report to the Insurer. He added: 4. In my opinion, Ms Wheeler's condition has stabilised. That is to say her injuries have become well-settled or static with or without treatment and are unlikely to remit despite treatment. Ms Wheeler's condition is unlikely to improve by greater than 3% over the ensuing 12 months. 5. Ms Wheeler has not engaged in any remunerative employment since leaving the NSW Police Force. She has had difficulty engaging in voluntary activities. 6. The likelihood of Ms Wheeler engaging in work on the open labour market in my opinion must be deemed as poor given her ongoing psychiatric symptomatologies and her limited educational experiences outside the NSW Police Force. She would have difficulty focusing and concentrating and relating to the public at large. She may be able to engage in menial tasks only… 10. In my opinion, Ms Wheeler's prognosis must be viewed as a guarded given the length of time she has experienced her symptomatologies and her limited improvement to date. (Emphasis added)
19. In the course of a whole person impairment evaluation, according to the WorkCover guidelines, Dr Smith said that Ms Wheeler suffered a severe impairment in relation to adaptation and: "Ms Wheeler is unable to work more than 1 or 2 days at a time. Her pace would be reduced and her attendance would be erratic".
20. In the course of the same evaluation, Dr Smith made an observation that is relevant to one of the grounds upon which the Insurer declined Ms Wheeler's application. He said, in relation to social functioning, that Ms Wheeler had moderate impairment, and: "Ms Wheeler reported a strained relationship with her partner. Sexual interaction no longer occurs. Her relationship with her partner has deteriorated significantly".
21. This report begins to show that, with the passage of time, and the failure of Ms Wheeler to respond to treatment, Dr Smith was becoming more guarded as to whether she would ever be able to engage in employment.
22. Then, on 28 August 2014, Dr Smith wrote a further report to an agent of the Insurer, in response to a letter dated 8 May 2014, by which Dr Smith was asked to respond to the Strategic Rehab Solutions vocational assessment report dated 10 April 2012, and another such report completed by Injury Treatment, dated 24 October 2012.
23. The significance of this report, for the purposes of the present dispute, is that Dr Smith expressed a changed opinion, as to whether Ms Wheeler would be capable of engaging in work of any kind in the future. As this report is of considerable importance, I will set out the more relevant parts of it in some detail: … I did highlight in my previous reports that Ms Wheeler may have the capacity to engage in work outside the NSW Police Force. It was Ms Wheeler's intention to undertake some work when she was discharged from the NSW Police Force. I was supportive of her goal in that regard. I did however express reservations pertaining to her psychiatric capacity to undertake such work. It should be noted that Ms Wheeler has not, since discharge from the NSW Police Force, progressed well from a psychiatric point of view. Indeed she experienced a marked downturn in her mood to the point that she displayed diagnostic criteria for a Major Depressive Disorder. She required readmission to St John of God Hospital at Richmond in the light of significant psychiatric symptoms of concern. She partially improved. She then experienced marked symptoms pertaining to her comorbid Post-Traumatic Stress Disorder and against that background I arranged for her readmission to St John of God Hospital Richmond. Indeed at the time of writing this report she remains under my clinical care at St John of God Hospital Richmond where she has been attending the "closed" specialised Post-Traumatic Stress Disorder program. I have noted the vocational assessment completed by Rehab Strategy Solutions dated 10 April 2012. I have also noted that at the time of that assessment Ms Wheeler was significantly improved and was residing with her husband and two children. It should be noted that her relationship with her husband has markedly deteriorated and they have now separated. As I have also noted her mood has also significantly deteriorated. The assessor has highlighted that Ms Wheeler did not have the motivation to go out and was spending most of her day inside. She required her husband or mother to take her to appointments. This in my opinion was consistent with her Major Depressive Disorder. I have noted the employment history and transferable skills suggested by the assessor. I have also noted the identified job options including administration assistant, medical laboratory technician, enrolled nurse, inquiry clerk, customer service officer and office manager. Whilst the vocations identified may from a theoretical point of view be deemed appropriate it is my opinion that the assessor has not taken into consideration Ms Wheeler's marked psychiatric disability that in my view would prevent her from engaging in such occupations. She would lack the self esteem and self confidence (sic) to undertake such work. She would also lack the ability to focus and concentrate on the relevant tasks required... I have noted that I previously did recommend that Ms Wheeler would be able to undertake the above suggested options with the exception of investigative work involving security or insurance. I subsequently and in the light of her marked psychiatric deterioration recommended that she could not engage at work. At the present time Ms Wheeler is incapacitated for work and as I have noted has been re-hospitalised in the light of her psychiatric disorder. IN RESPONSE TO THE SPECIFIC QUESTIONS RAISED IN YOUR LETTER OF 8 MAY 2014 I WOULD STATE AS FOLLOWS: 1. It is my opinion that Ms Wheeler is not able to perform the abovementioned alternate occupations now or in the future in a full-time or part-time capacity. I have noted that she is currently 36 years of age with 29 years remaining to work based on a retirement age of 65 years. I was hopeful that Ms Wheeler would have the capacity to engage in some work and I was encouraging her in that regard with her full compliance. Unfortunately she has deteriorated significantly to the point that she has had to be re-hospitalised at St John of God Hospital. She has only partially improved and I am guarded in regard to her prognosis. Ms Wheeler continues to demonstrate a significantly low self-esteem and loss of confidence with marked impairments in her capacity to concentrate and retain information. This is consistent with her comorbid Major Depressive Disorder. 2. The main reason why I have changed my opinion relates to the significant downturn in her emotional state. Placing her into a work situation that she feels that she cannot cope with in my opinion would pose a significant risk to her further psychological harm. She remains markedly dependent on others to assist her. 3. Ms Wheeler's current psychiatric condition demonstrates significant symptoms associated with her Post-Traumatic Stress Disorder, chronic induration, as well as comorbid Major Depressive Disorder. Current treatment includes hospitalisation, ongoing cognitive behaviour therapy, supportive psychotherapy and pharmacotherapy. 4. Whilst I have noted the recommendations from the vocational assessors it should also be noted that no detailed psychological evaluation has been undertaken by the assessors in regard to Ms Wheeler's capacity to undertake work.
24. It appears clearly from this report, that Dr Smith changed his position about Ms Wheeler's prognosis, and in particular, her capacity in the future to engage in any work, specifically the occupations suggested by Strategic Rehab Solutions. He did so because Ms Wheeler had suffered a "marked psychiatric deterioration".
25. There is nothing in this report, or any other report prepared by Dr Smith, which suggests that Ms Wheeler's PTSD and comorbid major depressive disorder were caused by any factor other than the experiences that had caused her to leave work with the Police Force.
26. Dr Smith mentioned Ms Wheeler's marital problems in the context of an observation that, at the time when the Rehab Strategy Solutions vocational assessment was completed, Ms Wheeler had significantly improved and was residing with her husband and two children. He noted that the relationship had markedly deteriorated and that Ms Wheeler and her husband had separated.
27. Dr Smith did not provide an opinion that the separation was in some way a new cause of Ms Wheeler's psychological condition that had intervened to cause her symptoms, or an exacerbation of symptoms, that could not directly be traced to her experiences while working for the Police Force.
28. It should be noted that the Insurer did not provide to Dr Smith, for his comment, any of the investigation reports, which the Insurer ultimately relied upon in deciding to decline Ms Wheeler's application. As will be seen, in my view this was a significant omission. It had the consequence that, when the Insurer made its determination, it did not have any expert psychiatric evidence as to whether the activities of Ms Wheeler described in the investigation reports, much of which suggested that Ms Wheeler may have been capable of operating normally, was inconsistent with the medical conclusions that Dr Smith had expressed concerning her capacity for employment, or not.
29. The evidence does not explain why the Insurer sought expert psychiatric opinion on the conclusions reached in the vocational assessment reports, but not the investigation reports.

Dr Richard Burek's reports

1. On 21 July 2012, the Insurer wrote a letter to a psychiatrist, Dr Burek, seeking an independent report, in different terms to the letter written to Dr Smith. Relevantly, the Insurer said: The claimant is now 35 years old. Her pre-disability occupation was a police officer full-time for the NSW Police force. She reported that her date last worked was 20.09.2010 and that she ceased work due to her claimed condition. The claimant has not worked in any capacity since that time. The claimant is currently applying for a Total and Permanent Disability Benefit. It would be appreciated if you would perform an examination and furnish us with a written report. In your report, we would like you to address the following issues: - 1. A brief description of the claimant including height, weight, hair colour, any distinguishing features. 2. Diagnostic Findings: What is your present diagnosis for the claimant's condition? 3. History: Please obtain and provide a comprehensive history, aetiology and chronology of the claimant's past and present difficulties and the treatment regimens employed to date to treat them. 4. Treatment Compliance: What treatment is the claimant currently receiving for this condition? Has he (sic) been satisfactorily complying with his (sic) present treatment regimen? If not, please note the areas where problems with compliance may exist. 5 Treatment Efficacy: What forms of treatment(s) do you currently recommend, and what is your opinion regarding the efficacy of the claimant's current treatment regimen? (Please be as specific as possible when outlining alternative treatment recommendation and indicate any specific problem areas or circumstances which may need to be addressed). 6. Motivation: Is the claimant motivated to attempt a return to his (sic) usual occupational work on a full-time or part-time basis? If lack of motivation is a problem, is it attributable to clinical symptomatology, or are non-clinical/medical issues a factor? 7. Secondary Gain: Is secondary gains (either from Disability Benefits or from any other factor or circumstance) playing a role in perpetuating the claimant's current presentation, and is it undermining his (sic) and/or willingness to return to gainful employment on a full-time or part-time basis? 8 Work Related Abilities and Limitations: Please kindly have the claimant describe his (sic) duties in his previous roles. In light of this information, please advise whether or not you consider the role as a sedentary type of work in nature and whether or not the claimant is currently medically fit to do this type of work on a part-time and full-time basis. Is there any condition or illness currently present which would render the claimant partially or totally incapable of meeting the duties and responsibilities required by his (sic) usual full-time occupational work as a police officer? Please explain. If the claimant is presently able to work in some capacity but with limitations or restrictions, please specify the degree and type of limitations you would place on him (sic), and also provide the basis of these limitations. (Note: Limitations may be expressed in terms of a reduced number of hours per day or week, a percentage of all normal occupational duties, and/or may be specified to limitations or restrictions on a particular function within a job description). 9. Prognosis: If the claimant is not currently able to return to work in a full-time or part-time capacity, what is your prognosis regarding the claimant's prospect for recovery and eventual return to his (sic) usual occupational work as a police officer in a full time (40 hours per week) capacity? If it is your medical opinion that the claimant might be able to return to his (sic) usual occupational work as a police officer on a full-time basis in the foreseeable future, what is your estimated timeframe and what steps would Mr Westwood (sic) need to undertake to do this? How many hours per week the claimant would be medically considered capable of working? If it is your medical opinion that there is no possibility for the claimant to return to work to his usual occupation what type of work is suitable for Mr Westwood (sic) in view of his education, training, experience and current condition? Do you consider that the claimant has become incapacitated to such an extent as to render him (sic) unlikely ever (until age 65) to engage in any gainful profession, trade or occupation for which he is reasonably qualified by reason of education, training or experience? (Emphasis in original)
2. Dr Burek apparently assessed Ms Wheeler on 6 August 2012. It is not clear how long the consultation lasted for. He provided a report to the Insurer dated 17 August 2012.
3. Dr Burek agreed that the present diagnosis for Ms Wheeler's condition was chronic PTSD and major depressive episode.
4. However, he gave the following opinion concerning Ms Wheeler's treatment regime: On Ms Wheeler's testimony, her traumatic and depressive symptoms remain as already described. As such, she is under-treated. She has only had one antidepressant and she has had no mood stabiliser. Ms Wheeler states that she and her mother are going to see Dr Selwyn Smith next week. It is possible that she may be admitted as an inpatient. I consider that she needs her antidepressants reviewed. There are other antidepressant medications that could be trialled… I consider that current treatment is ineffective from a pharmacological point of view. She has only had one antidepressant Lovan. On her testimony, 20 mg has had little impact and there has been no improvement on 40 mg. Ativan is the only medication she is taking to help sleep; as symptomatic treatment it is adequate. Another antidepressant should be trialled. She still has significant symptoms. Consideration could be given to a mood stabiliser that may help with traumatic night-time experiences. There are other medications to help with sleep, e.g. Stilnox, Imovane, or Phenergan.
5. Dr Burek said that Ms Wheeler's lack of motivation was a problem, but that it was attributable to her clinical symptomatology. He also said that there was no evidence of secondary gain playing a role in perpetuating Ms Wheeler's presentation.
6. Dr Burek also said that Ms Wheeler could not currently work in any capacity. In relation to the crucial issue of what work Ms Wheeler might be capable of doing, if there was no possibility for her to return to her usual occupation, Dr Bureck said: I consider there is no possibility that Ms Wheeler will return to work in her usual occupation for which she is trained… On enquiry about whether she could return to nursing, I consider this is highly unlikely. Nursing work entails the same sorts of problems that she would have to deal with emotionally as confronted her in the drownings, suicides and murders to which she has already been exposed. She also states she only worked for two years in nursing and it ended in 1999… I do not consider that Ms Wheeler is incapacitated to such an extent that she will never (until the age of 65) engage in any gainful profession, trade or occupation. Currently her treatment could be improved as I stated in the formulation. As such she is not permanently incapacitated. (Emphasis added)
7. It is this last opinion that is most significant. Dr Burek stated, without explanation, that he did not consider that Ms Wheeler was incapacitated to such an extent that she would never engage in any gainful profession. In fact, the Insurer asked Dr Burek to express an opinion on the correct question, which was whether Ms Wheeler was "unlikely ever (until age 65) to engage in any" relevant employment. Dr Burek, however, answered a different question, when he said that he did not consider that Ms Wheeler "will never" engage in any relevant employment. As this question went to the heart of the TPD definition, it ought to have been clear to the Insurer and Dr Burek that precision was required. The criterion "never" is a more absolute and stringent one than the criterion "unlikely ever"; see Shuetrim at [65]. The former requires the formation of a positive opinion that there is zero chance of the event happening. The latter may be satisfied even though there is in fact some real chance (even though unlikely) that the event will occur.
8. As will be seen, these observations do not involve the mere splitting of hairs, as, in its 4 September 2015 letter advising Ms Wheeler of the reasons for its denial of her application, the Insurer specifically relied upon this aspect of Dr Burek's report, where it said: "In his report dated 17 August 2012, Dr Burek did 'not consider that Miss (sic) Wheeler is incapacitated to such an extent that she will never (until the age 65) engage in any gainful profession, trade or occupation'".
9. Furthermore, Dr Burek clearly linked his conclusion that Ms Wheeler was not permanently incapacitated to his opinion that currently her treatment could be improved. This follows from the use of the expression "As such" in his statement of opinion: "Currently her treatment could be improved as I stated in the formulation. As such she is not permanently incapacitated".
10. On the evidence before the court, the Insurer relied upon this statement of opinion by Dr Burek, without following up in any way, either his suggestion that Ms Wheeler's condition would be improved by a change of medication, or the appearance that Dr Burek's opinion that Ms Wheeler was not permanently incapacitated, was dependent upon the doctor's view that her condition would be improved if her medication was changed.
11. The Insurer ignored this issue in the reasons that it gave for denying Ms Wheeler's claim.
12. One consequence of the Insurer's refusal to provide Dr Burek's report to the Trustee, or Ms Wheeler's solicitor, until the time of the procedural fairness letter, was that Ms Wheeler was not given any real opportunity to respond to Dr Burek's suggestion, and if it was thought beneficial, to trial the new medications, to see whether they had the effect expected by the doctor.
13. On 10 May 2013, the Insurer asked Dr Burek whether he agreed with the findings in the vocational assessment reports, that Ms Wheeler would, at some point, be capable of performing the identified work options in either a part-time or a full-time capacity. Dr Burek's response was: I advise that Ms Wheeler would, at some point, be capable of performing these identified work options in either a part-time or full-time capacity. I interviewed Ms Wheeler on 06 August 2012. I have not seen her since. At that time she was not able to do any work at all, due to her ongoing psychiatric symptomatology. (Emphasis added)
14. Even allowing for the practical and commercial setting in which this report was written, the opinion given by Dr Burek is stated in a remarkably bald way. It is supported by no reasoning whatsoever. The extremity of Dr Burek's response is demonstrated by the fact that he had only seen Ms Wheeler once, some eight months previously.
15. Dr Burek was also specifically asked to comment on whether he perceived any differences between the history that Ms Wheeler had given to him during their single consultation, and material contained in factual investigation reports concerning enquiries made with a representative of the Police Force, on the one hand, and the history given by Ms Wheeler, as shown in Dr Smith's reports, on the other.
16. In relation to the information obtained from the Police Force, Dr Burek observed: "She gave me no information about problems directly relating to a fellow officer, or problems in being denied promotion".
17. As to the history apparently provided to Dr Smith, Dr Burek pointed to a statement in Dr Smith's report where he had said: "To compound her emotional symptomatologies Ms Wheeler also reported being bullied and harassed by a work colleague who was superior to her. Attempts at mediation with this particular man were most distressing to her." Dr Burek observed: "Dr Smith gained this information; I did not gain it. As such there is an important inconsistency in the information gained by us".
18. It is perplexing why these apparently minor differences between what Dr Burek was told by Ms Wheeler in a single consultation, what the Insurer learned by enquiries with some representative of the Police Force, and the history that Ms Wheeler apparently gave to Dr Smith, are of any significance. If there is any significance, it was not explained by Dr Burek.
19. Again, this is not an inconsequential matter. In its letter of reasons for declining Ms Wheeler's application, the Insurer said: Dr Burek was asked by [the Insurer] to consider the histories given by the member to both Dr Smith and Dr Burek. Dr Burek noted that Dr Smith had taken a history of being bullied and harassed by a work colleague superior to her, and that attempts at mediation 'were most distressing to her'. Dr Burek noted that 'Dr Smith gained this information; I did not gain it. As such there is an important inconsistency in the information gained by us'.
20. The implication appears to be that Ms Wheeler had not been frank in the histories that she gave to the two doctors. This consideration must have influenced the Insurer's decision-making process, because it has said so. The importance of the information is entirely unexplained. When one reviews the histories contained in the reports of the two doctors, it becomes clear that Ms Wheeler gave complex, comprehensive and consistent histories. Particularly given her psychological condition, it is not to be expected that she would have been entirely exhaustive each time she was required to explain her history to a new doctor.

Dr Robert Wotton's reports

1. Dr Robert Wotton is a consultant psychiatrist, who provided medico-legal reports to Employers Mutual NSW Ltd, on 30 July 2014 and 12 November 2014. The Insurer referred to both reports, when it determined Ms Wheeler's application. The later report was provided to the Insurer by means of Ms Wheeler's solicitor's letter to the solicitors for the Insurers on 27 March 2015. Dr Wotton examined Ms Wheeler on 30 July 2014 and 12 November 2014. It is fair to say that both of Dr Wotton's reports appear to be well-reasoned.
2. In his 30 July 2014 report, Dr Wotton recorded that, in February of that year, Ms Wheeler was hospitalised for four weeks for treatment for PTSD and depression.
3. Dr Wotton set out the following results of the mental state examination that he carried out: Mrs Wheeler appeared anxious from the beginning of the interview and this did not diminish throughout the hour and a half that I saw her. Although a good historian in that she was able to outline a number of traumatic events and experience in her life as a police woman, Mrs Wheeler was at times unable to give a strict chronology of events. She said from the outset that her memory was no longer accurate. She gave a convincing account of accumulated trauma in the workplace with a series of either threats to her own life or close counters with the horrific or tragic deaths of others. She was at times tearful in relation particularly to the loss of her identity as a police woman. She was obviously distressed about the degree of emotional restriction that her illness had caused her. Her affect was appropriate to her mood. There were no signs of any psychotic forms of thinking. Mrs Wheeler appeared to be a genuine woman with an above average intelligence and good insight into her condition… Psychiatric diagnosis: Post-traumatic stress disorder.
4. Under the heading "Fitness for Work", Dr Wotton said: Based on the review particularly of her treating psychiatrist Dr Smith and my assessment, I do not believe Mrs Wheeler is fit for work. She is significantly affected by her symptoms and struggles to maintain a household.
5. Under the heading "Permanent Impairment", Dr Wotton opined: I am unable to determine whether the condition has reached the point of maximum medical improvement, as there are still treatment options open to Mrs Wheeler. I think that this would best be re-evaluated following the second attendance at the St John of God Adult Trauma Program… I do agree with the assessment of Dr Selwyn Smith about her overall condition and its prognosis.
6. Dr Wotton provided his 12 November 2014 report, after an additional examination of Ms Wheeler, and with the benefit of a report from the St John of God Hospital. Ms Wheeler gave information to Dr Wotton about the results of the four weeks that she had spent as an inpatient at the St John of God Hospital.
7. Ms Wheeler told Dr Wotton that her relationship with her husband had broken down. That subject had not been raised at the time of Ms Wheeler's earlier examination by Dr Wotton. Dr Wotton observed: She was surprisingly emotionally unresponsive when describing the deterioration of her marriage, her husband's leaving her, and the prospect of a life without him. It was as if she was emotionally numb to these unfolding events. She was frank about the degree to which she must have underestimated the impact of her illness on her husband's capacity to cope.
8. Dr Wotton's conclusion about Ms Wheeler's recent treatment by the St John of God Hospital was: There has been no change in diagnosis. Ms Wheeler has had some symptom relief from her period of treatment in St John of God Hospital, but she is still markedly symptomatic and clinically impaired from her condition.
9. In relation to Ms Wheeler's fitness for work: Given that improvement overall has not occurred, and given that Mrs Wheeler may now be facing a permanent separation from her husband, it is highly unlikely that she will ever be fit for work. (Emphasis added)
10. Dr Wotton said that Ms Wheeler's condition had reached the point of maximum medical improvement.
11. He made an evaluation of permanent impairment, and in respect of employability he said: "Still majorly impaired by her symptoms. Can have some days where she functions adequately for a few hours, but this is likely to be followed by days where she is unable to function. Would be totally unreliable for these reasons in any work place setting".

Vocational assessment reports

1. The Insurer relied upon two vocational assessment reports when it rejected Ms Wheeler's application. The first was prepared by Ms Lauren Gow, of Strategic Rehab Solutions, for Employers Mutual Ltd, on 10 April 2014, following a meeting with Ms Wheeler on 29 March 2014.
2. The report, which appears on its face to have been professionally prepared, identified that Ms Wheeler had several transferable skills that would permit her to undertake the following occupations: insurance officer, welfare officer, office manager, investigator (fraud), security - loss prevention, control room and alarm monitoring, and insurance investigator.
3. The report noted that Ms Wheeler had been diagnosed with PTSD and with anxiety. It also noted that Ms Wheeler had said that she was hopeful that her condition would improve in the future. It noted Ms Wheeler's description of her psychological function, in which she described a number of limitations on her ability to function, and then continued: No formal evaluation of Ms Wheeler's psychological status was conducted during the Vocational Assessment. Ms Wheeler reported that she has been advised by his (sic) Psychiatrist/Nominated Treating doctor, Dr Selwyn Smith that she is unable to return to the police force.
4. The second vocational assessment report was provided on 24 October 2012 by Injury Treatment to the Insurer. The author, Ms Maura Goonetilleke, assessed Ms Wheeler on 16 October 2012.
5. Ms Goonetilleke had the benefit of Dr Smith's report dated 1 May 2012, as well as the Strategic Rehab Solutions report. Dr Smith's report was the short report in which he had said that, in general, Ms Wheeler would be able to undertake some of the options suggested by Strategic Rehab Solutions, but that she may not be able to participate in such work, and a trial job option may be in order.
6. Apparently, no further consideration of Ms Wheeler's psychological condition was undertaken. Ms Goonetilleke identified five potential areas of employment, being administration assistant, medical laboratory technician, enrolled nurse, inquiry clerk/customer service officer, and office manager.

Investigation reports

1. In the period between 20 July 2012 and 28 May 2014, the Insurer obtained six investigation reports, which it advised in its procedural fairness letter it proposed to take into account.
2. The reports cover many matters, and it is appropriate to look to the procedural fairness letter to identify the information in the reports that the Insurer considered to be significant.
3. The first report was prepared by AHC Investigations on 20 July 2012. It reported that Ms Wheeler had been listed as a player in 2012 for the Camden & District Netball Association, with the Benkennie Boosters. Ms Wheeler had played the last five out of eight games.
4. A second report by AHC Investigations, dated 12 September 2012, related to surveillance on five days between 3 August 2012 and 31 August 2012. Ms Wheeler was seen to be active away from her residence on all days, engaged in matters such as shopping at her local shopping centre, attending a local hospital, attending a medical clinic, departing a netball game, and conversing with various persons. She appeared to sustain injuries playing netball on 18 August 2012.
5. Brooksight Investigations provided a report to the Insurer, on 17 December 2012, of an interview carried out with Ms Wheeler on 10 December 2012. In its procedural fairness letter, the Insurer described the information in this report that did not support Ms Wheeler's claim in the following terms: … You provided a history that there was interpersonal conflict involving you, Senior Constable Herman Pereira and his girlfriend, Chris who also worked at the same local area command. You advised that you were required to participate in mediation with Senior Constable Herman Pereira which was unsuccessful. You did not mention your unsuccessful job application and that the role was awarded to Senior Constable Pereira.
6. Brooksight Investigations also provided a report dated 7 March 2013, concerning interviews with members of the NSW Police Force. The only apparent significance of this report, which the Insurer also said did not support Ms Wheeler's claim, was that Ms Wheeler had been unsuccessful in an application for promotion, on or about 13 March 2010, and that the role had been awarded to the officer against whom Ms Wheeler had made allegations of bullying and harassment.
7. By a further report of AHC Investigations, dated 22 May 2014, the Insurer was advised that Ms Wheeler was an active member of the Boston Terrier Club of NSW. Her dog was shown and won a number of awards at various shows held from 23 March 2014 to 18 May 2014. The dog was also exhibited and won an award on 21 December 2013 at the Dogs NSW Christmas Show. The dog had won 'best in show' at the 2014 Royal Easter Show. It had also been shown at various other locations including Wollongong, Blacktown, Goulburn and Liverpool.
8. The report also identified Ms Wheeler on Facebook, smiling and socialising with friends.
9. The Insurer also referred to a further report by AHC Investigations dated 28 May 2014, although it states that Ms Wheeler was not sighted in the surveillance operation that was carried out in the period 16 May 2014 to 24 May 2014.

Attempts by Trustee and Ms Wheeler to obtain information

1. Ms Wheeler's present solicitor became involved in the matter, for the first time, on 5 August 2013. On that day he wrote to the Trustee, and requested information concerning the status of the TPD application; whether the Trustee was waiting for any information; and if so, what that information was. He also requested copies of the vocational report, the psychiatric report, and the Brookside transcript, which had been prepared in response to the steps that the Insurer asked Ms Wheeler to take in support of her claim. He also asked for copies of any medical reports held by the Insurer or the Trustee. He added: You will appreciate that as a sufferer of Post Traumatic Stress Disorder (PTSD) Mrs Wheeler does have anxieties regarding these issues and your prompt response to this letter would be of great assistance and reassurance to her.
2. On 5 August 2013, Ms Wheeler's solicitor wrote a letter to the Insurer, with which he enclosed a copy of his letter to the Trustee of the same date, and an authority executed by Ms Wheeler on 23 July 2013, for documents to be provided to the solicitor in relation to her claim. The solicitor also said that he would be obliged if the Insurer could provide him with written confirmation of the status of the claim.
3. The Trustee provided certain technical information to the solicitor, on 21 August 2013, and advised that, once a response had been received from the Insurer, the solicitor would be advised.
4. On 4 September 2013, the Trustee wrote to the solicitor to request that a privacy request form be completed, so that the Insurer could release copies of any reports that it held on its file. The Trustee advised that the Insurer was in the process of completing a full file review, and also sending to Dr Smith a request, asking him to comment on the vocational assessment and factual reports.
5. I interpolate here, that the Insurer did not actually make that request of Dr Smith until 8 May 2014.
6. On 9 September 2013, the solicitor wrote to the Trustee, questioning the Insurer's need for a formal privacy authorisation, given that the solicitor had already sent to the Trustee on 23 July 2013, an authority from Ms Wheeler to deal with the solicitor. The solicitor asserted: We assert that there is an obligation on you as a Trustee and [the Insurer] as the Insurer to be open and transparent in respect of the process leading to the determination of our client's TPD claim. This obligation we assert, includes the provision of all relevant documentation.
7. On 11 October 2013, the Trustee again asked the solicitor to provide a completed privacy request form, without responding to the solicitor's 9 September 2013 letter.
8. The Trustee responded to that letter on 18 October 2013, by advising that it had forwarded the solicitor's letter to the Insurer.
9. The Trustee again wrote to the solicitor on 4 November 2013, and stated that it had requested the Insurer to release the medical reports, which the solicitor had requested, to the Trustee within 14 days.
10. On 4 November 2013, the Trustee wrote a letter to the Insurer that included the following: We have been provided with a copy of correspondence between the Member's solicitor and [the Insurer] in relation to the Member's request that [the Insurer] release the medical reports it holds in its possession in connection with the assessment of the Member's TPD claim. We note that [the Insurer] is continuing to assess the Member's claim. We also note that [the Insurer] has advised the Member's solicitor that in order to consider the request for release of the Medical reports that it holds, the Member will need to complete a form entitled "Request to Access Personal Information" and pay a fee of $25.00 to cover [the Insurer's] administration costs… The Trustee notes the following: 1. The Member has signed a Declaration and Authority which authorises [the Insurer] to disclose her personal information…to his (sic) Fund Trustee/Administrator. 2. NPP 6 requires [the Insurer] to provide a Member with access to their personal information on request of a Member unless one of the exceptions set out in NPP 6 apply. In the light of correspondence recently received from [the Insurer's] Privacy Officer, the Trustee anticipates that [the Insurer] will rely upon NPP 6.1(f) to refuse to provide the requested medical reports. The Trustee's view is that should [the Insurer] approach the request of the Member's solicitor in this way, this is not a proper basis to refuse the Member access to the requested medical reports. There are presently no negotiations on foot with the Member and the claim is under assessment… As you know, the Trustee has a duty to act in the best interests of the Member and to do everything that is reasonable to pursue his (sic) insurance claim if the claim has reasonable prospects of success. The Trustee considers that the Member's request that [the Insurer] released the medical reports it holds in its possession in connection with the assessment of his (sic) TPD claim to be a reasonable request and one which [the Insurer] should consider favourably. Having regard to the above, please provide the Trustee with the medical reports in [the Insurer's] possession in connection with the assessment of the Member's TPD claim within 14 days. The Trustee will then provide the reports to the Member's solicitor in accordance with the request. If [the Insurer] does not agree to provide the Trustee with the medical reports that the Member's solicitor has requested, please provide the Trustee with detailed reasons supporting that decision.
11. I infer that the reference to NPP 6.1(f) is a reference to part of the National Privacy Principles, which are found in Schedule 3 to the Privacy Act 1988 (Cth). That provision is: 6.1 If an organisation holds personal information about an individual, it must provide the individual with access to the information on request by the individual, except to the extent that… (f) providing access would reveal the intentions of the organisation in relation to negotiations with the individual in such a way as to prejudice those negotiations…
12. The evidence does not show whether the Insurer was relying upon this provision, as it did not respond to the Trustee's letter.
13. On 25 November 2013, Ms Wheeler's solicitor wrote another letter to the Trustee, in which he asked whether a response had been received from the Insurer, and again asked for copies of the vocational assessment, the psychiatrist's report, and the report of the Brooksight investigation. He also said: "As you can appreciate it has been twelve (12) months since our client undertook the above examinations and interviews and she is still awaiting a determination of the claim. Can you please advise whether the Insurer is awaiting further documentation to make their determination?
14. The Trustee again wrote to the Insurer on 26 November 2013. It reiterated the request made in its 4 November 2013 letter, and requested that the Insurer provide it with detailed reasons supporting any decision to decline to provide the Trustee with the medical reports requested by Ms Wheeler's solicitor "no later than COB 28 November 2013" (emphasis in original). The Trustee's letter continued: In addition, please find enclosed a copy of further correspondence from the Member's solicitor addressed to the FSS Trustee dated 25 November 2013. Please note the Member's solicitor is requesting an urgent update in regards to the status of the Member's claim and requesting advice as to whether [the Insurer] is awaiting further documentation in order to finalise their determination. Please provide the FSS Trustee with an urgent response to same to be forwarded to the Member's solicitor. The Trustee also takes the opportunity to put [the Insurer] on notice that if the Member's solicitor litigates in respect of the length of time [the Insurer] is taking to finalise the assessment of this claim (now in excess of sixteen (16) months) that the Trustee will seek the recovery of defence costs from [the Insurer]. We look forward to your urgent response.
15. The Trustee again wrote to the Insurer on 11 December 2013. It noted that it had received no response to its letters of 4 and 28 November 2013. It then said: We now call on you to provide a copy of all the documents obtained or received by you in respect of the above claim, except those documents sent to you by us. We also call on you to provide the qualifying/instructing letters sent by you in respect of the above claim.
16. The letter then refers to what is described as "the portal". The evidence does not explain what the portal was. However, it apparently enabled the Trustee to identify that the Insurer had seven types of information, including medical reports, vocational assessments, and factual interview reports. The letter states that the Trustee's call includes, but is not limited to, those documents.
17. The letter continues: Properly answering this call is an important incident of your duty under the contract to consider the claim reasonably and to form a proper opinion as to whether you are satisfied the insured member meets the second limb of the total and permanent disablement definition. Unless you have already determined to pay the benefit, discharging your contractual obligations to properly inform yourself requires you provide all the material under your consideration to [the Trustee] for our review and for us to obtain the comment of the insured member or expert or legal advice as we deem appropriate. Furthermore, you have a duty of utmost good faith to [the Trustee] to cooperate with [the Trustee] in achieving the contractual objects. This includes a duty to give proper disclosure in respect of the claim. Your duty to disclose is not limited to evidence you consider adverse to the claim and on which you intend to rely but includes evidence supportive of the claim or which, when read with other material, is capable of supporting a submission favourable to the claim… Persistent failure to answer our correspondence and to provide the requested documents will be an actionable breach of contract. Please let us have your response as a matter of urgency by 5 PM 13 December 2013… If we do not have a satisfactory response from you by that date we will refer the matter to our solicitors for further action.
18. Ms Wheeler's solicitor wrote a reminder letter to the Trustee, on 16 December 2013, in which he sought a prompt response.
19. The Trustee wrote to Ms Wheeler's solicitor, on 20 December 2013, to say that the Trustee had raised his concerns with the Insurer on a number of occasions, and that when the issue was resolved, the requested documentation would promptly be provided to the solicitor.
20. The Insurer did not respond to any of the Trustee's correspondence.
21. The solicitor again wrote to the Trustee on 11 April 2014. He referred to a letter to the Trustee dated 20 February 2014, which does not appear to be in evidence. He noted that Ms Wheeler's claim had been under consideration for approximately 23 months, and said that "the determination is long overdue". He then set out a detailed chronology of the correspondence. The balance of the letter included the following: We remind you that Mrs Wheeler is suffering from a serious psychological injury and this continued delay is serving only to exacerbate her already significant anxiety about the matter. We note that having lodged the claim herself and dealing with the Trustee and the Insurer for approximately fifteen (15) months, Mrs Wheeler's psychological symptoms were so acute that she was compelled to retain our office to act on her behalf. We assert that any further delay is likely to have a significant impact on our client's psychological well being (sic) and strengthen a potential damages and interest claim against the Trustee and Insurer for failing to handle the matter with due dispatch… Due to the length of time and the amount of evidence presently before the Insurer, we do not see why a determination has not been made in this matter and we formally request that this matter be reviewed and a determination be reached as a matter of urgency. Should a determination fail to be communicated to us within twenty-eight (28) days from the date of this letter, we will take this as a constructive declination of the claim and will initiate proceedings in the Supreme Court seeking declarative relief, including a claim for interest and legal costs without further notice to you. We confirm that a copy of this letter has been provided to [the Insurer] (emphasis in original).
22. The Trustee wrote to the solicitor on 5 May 2014. It advised that it appreciated Ms Wheeler's frustration, and said that the Trustee had escalated Ms Wheeler's TPD claim with the Insurer. It said that the Trustee would defend any claim made against it.
23. The Trustee also wrote to the Insurer on 5 May 2014. It enclosed a copy of the solicitor's 11 April 2014 letter. It is not necessary to set out the terms of the letter in detail. It repeated the complaints and demands that the Trustee had made on a number of occasions. It included: We ask that you provide us with a comprehensive status update with respect to [the Insurer's] assessment of the TPD claim by no later than close of business on Thursday 8 May 2014, including whether [the Insurer] is awaiting any further information, why it considers this information necessary to enable it to make a determination and the expected timeframe for receipt of same. Please also address the concerns raised by the member's solicitor in the enclosed correspondence. In the event we do not receive a satisfactory response from you by the specified time, we may refer this matter to our solicitors for further action (emphasis in original).
24. The Insurer responded on 8 May 2014. The response included: We acknowledge the concerns raised in the correspondence and confirm that this matter has been referred to our Dispute Resolution Officer who will provide a substantive response within 45 days of the date of the date (sic) your letter. Regarding the status (sic) this claim, we advise that we have undertaken a review of the claim and written to Dr Smith for updated information and expect a response within 30 days of the date of that request. We will continue to follow up this request to ensure its timely completion. We appreciate the member's cooperation in this regard. Upon receipt of this information we will notify the Fund and provide a status update.
25. It seems extremely likely that it was the Trustee's letter of the same date that prompted the Insurer to initiate the request.
26. As has been seen above, it was this request that caused Dr Smith to provide an updated opinion, in which he explained why his experience treating Ms Wheeler had caused him to form the following conclusion: "It is my opinion that Ms Wheeler is not able to perform the above-mentioned alternative occupations now or in the future in a full or part-time capacity".
27. On 26 May 2014, the Trustee wrote to Ms Wheeler's solicitor, to inform him of the Insurer's response.
28. Ms Wheeler filed her statement of claim in this matter on 11 June 2014. The Trustee's defence was filed on 14 November 2014, and the Insurer's defence was not filed until 18 March 2015.
29. Nothing then happened, so far as the Insurer's communications with the Trustee and Ms Wheeler's solicitor was concerned, until, it appears, 2 March 2015. A letter from Ms Wheeler's solicitor to the solicitors for the Insurer, dated 27 March 2015, refers to a letter from those solicitors dated 2 March 2015. That letter is not of particular significance. It asked whether the Insurer was entitled to take into account the contents of an affidavit served by Ms Wheeler in these proceedings. Ms Wheeler's solicitor enclosed a copy of the report of Dr Robert Wotton, dated 12 November 2014, and asked that the Insurer take the report into account in making its determination on Ms Wheeler's application for the TPD benefit.
30. A further five months elapsed, before, on 13 August 2015, the Insurer sent its procedural fairness letter to Ms Wheeler. I will deal with the terms of this letter, Ms Wheeler's response, and the Insurer's letter dated 4 September 2015, by which it declined Ms Wheeler's application, below.
31. For present purposes I note that the 4 September 2015 letter declining the application contained the following statement (before setting out the TPD definition in each of the policies): The member's entitlement to payment of the TPD benefits requires that the member provide proof to our satisfaction that as at 21 March 2011 she had…
32. In relation to each policy, the final conclusion stated by the Insurer was: The member has not provided proof of these matters to [the Insurer's] satisfaction as required by the Policy. Consequently no TPD benefit is payable pursuant to [the relevant] Policy.

The procedural fairness letter

1. As has been stated above, the Insurer wrote a procedural fairness letter to Ms Wheeler on 13 August 2015. It gave her 14 days to make submissions in response.
2. The letter contained an outline analysis of the evidence separately under the headings "Evidence in support of TPD claim", and "Evidence that does not support the TPD claim". The letter in substance extracted the material from the doctors' reports, the vocational assessment reports, and the investigation reports that I have summarised above. There was an accompanying schedule that extracted the available material in additional detail.
3. Perhaps the most notable feature of the letter is that nearly all of the information unfavourable to the claim came into existence before Ms Wheeler filed her statement of claim on 11 June 2014, and almost all of the information that supported the claim came into existence afterwards.

Ms Wheeler's solicitor's response

1. Ms Wheeler's solicitor sent a response to the Insurer's solicitors on 27 August 2015. He said that it appeared to be no coincidence that the procedural fairness letter was written a few weeks before the case was due to be heard, and suggested that it was an attempt by the Insurer to require Ms Wheeler to overcome a new hurdle, by having to show that the reasons that the Insurer would give for rejecting her claim were attended by relevant error.
2. The solicitor claimed that the Insurer's delay in responding at all to Ms Wheeler's claim amounted to a serious breach of its duty of good faith and fairness.
3. Perhaps as a result of the limited time that had been given, the response was brief and did not engage with the detail in the procedural fairness letter to any significant degree.
4. Unlike the situation in Shuetrim, in the present case, Ms Wheeler's solicitor did not respond to the procedural fairness letter by inviting the Insurer to make a decision immediately on the claim: see Shuetrim at [104].

The Insurer's rejection of the plaintiff's claim

1. The Insurer pleaded in its defence that it made the determination to reject Ms Wheeler's application for the TPD benefits on 2 September 2015, and wrote to the Trustee advising it of its reasons on 4 September 2015.
2. The Insurer made a submission to this effect in its final submissions, but it did not point to any evidence of the actual determination having been made on 2 September 2015. As the Insurer did not call the relevant claims manager, and there is no documentary evidence of the actual determination, I find that the Insurer has not proved when the determination occurred.
3. On 4 September 2015, the Insurer wrote a letter to the Trustee, in which it informed the Trustee that it had rejected Ms Wheeler's claim, and set out its reasons for that decision. It is necessary to set out the Insurer's letter in full: We refer to the Member's claim for Total and Permanent Disability (TPD) benefits under the PBRI Policy and FSS Policy. We wrote to the fund and member on 13 August 2015 providing an opportunity to comment on the information MetLife has obtained during the assessment of the TPD claims. We received a letter from Slater and Gordon addressed to TurksLegal dated 27 August 2015 providing the member's response to our letter of 13 August 2015. We have not received a response from the fund. In deciding whether the member is TPD as defined in both policies, regard must be had to the unlikelihood of a return to work as at the date 6 months from the date last worked. The member last worked on 21 September 2010. The relevant date of assessment is 21 March 2011. The member's entitlement to payment of the TPD benefits requires that the member provide proof to our satisfaction that as at 21 March 2011 she had:

• PBRI Policy - been absent from her occupation with the employer through injury or illness for six months; and had become incapacitated to such an extent as to render her unlikely ever to engage in any gainful profession, trade or occupation for which she has reasonably qualified by reason of education, training or experience.
• FSS Policy - been absent from her occupation with the employer through injury or illness for six months; and had become incapacitated to such an extent as to render her unlikely ever to engage in or work for reward in any occupation or work for which she was reasonably qualified by reason of education, training or experience. For the purpose of ascertaining whether the member is unlikely ever' to return to work within the terms of the definitions, MetLife has had regard to the retirement age of 65, and hence whether the member was at the date of assessment incapacitated to the extent that she was unlikely to return to such work at any time prior to reaching age 65. In the letter from her solicitors Salter & Gordon, dated 27 August 2015, the member places reliance upon having suffered from Post-Traumatic Stress Disorder ('PTSD') and a major depressive disorder 'from 2010 to date'. The letter from Slater and Gordon misconceives the question MetLife is to determine by emphasising the situation as at 2015, rather than as at the date of assessment. The letter also misconceives the question that MetLife is required to consider in assessing this claim, which the solicitor describes as being 'that the plaintiff is not employable after 5 years of unemployability'. The question MetLife is required to determine with respect of both the PBRI and FSS policies is set out above. For the reasons discussed in our letter of 13 August 2015, MetLife has not formed the opinion that the member had at the date of assessment become incapacitated to such an extent as to render her unlikely ever to engage in any gainful profession, trade, occupation or work for which she was already reasonably qualified by reason of education, training or experience. The letter from the member's solicitor dated 27 August 2015 has not persuaded MetLife to form the opinion that as at the date of assessment the member had become incapacitated to such an extent as to render her unlikely ever to engage in such work for which she was already reasonably qualified by reason of education, training or experience before age 65. The reports of Dr Smith (psychiatrist), Dr Wotton (psychiatrist) and Dr Richard Burek (psychiatrist) are all pertinent to the member's condition as at 21 March 2011. Dr Smith in his report dated 24 March 2011 considered that while the member was then currently not fit to perform work external to the NSW Policy Force, he anticipated that 'over time she will be able to engage productively in work outside the NSW Police Force'. He concluded that treatment would assist in reintegrating the Member into alternative work outside the NSW Police Force. Dr Smith provided a further report shortly thereafter, dated 29 April 2011, stating that he anticipated that the Member would be able to engage in alternative work shortly after completing a Post-Traumatic Stress Disorder program. Dr Smith noted in his later reports (23 September 2011, 27 January 2012, 1 May 2012 and 31 July 2012) that the Member may be able to engage in work in the future outside NSW Police Force. He did not state that his opinion was contingent at that time upon the Member's response to treatment. In his report dated 28 August 2014, Dr Smith when referring to the vocational options identified in the Strategic Rehab Solutions report (discussed below) stated that 'Ms Wheeler is not able to perform the abovementioned alternative occupations now or in the future in a full time or part time capacity'. Dr Smith's opinion regarding the member's capacity for work was expressed well after the date of assessment. Further, Dr Smith described a downturn in the member's emotional state well after the relevant date and in the context of her then-current marital crisis. In his report dated 17 August 2012, Dr Burek did 'not consider that Miss Wheeler is incapacitated to such an extent that she will never (until the age of 65) engage in any gainful profession, trade or occupation'. He concluded that 'Currently treatment could be improved as I stated in the formulation. As such she is not permanently incapacitated'. Our letter of 13 August 2015 specifically drew attention to the report of Dr Wotton, Consultant Psychiatrist, dated 12 November 2014 as supportive of the TPD claim. The letter from the member's solicitor dated 27 August 2015 alleges that MetLife 'does not appear to have taken Dr Wotton's report into consideration when considering the plaintiff' TPD status'. This is incorrect. The member's solicitor also asserts that the report of Dr Wotton dated 12 November 2014 was 'supportive of the plaintiff's claim', but does not elaborate as to the manner in which that report was supportive of the claim. We note that Dr Wotton had considered in his report dated 3 July 2014 that it was too early to determine whether the member had obtained any substantial benefit from treatment and recommended further outpatient treatment. In his later report of 12 November 2014, Dr Wotton considered that 'given improvement overall has not occurred, and given that Ms Wheeler may now be facing a permanent separation from her husband, it is highly unlikely that she will ever be fit for work'. Dr Wotton's opinion is expressed at the date of his assessments of Ms Wheeler on 12 November 2014, well after the date of assessment. Further, Dr Wotton considered that the gains from treatment the member would receive would depend on stress coming from extraneous factors, for example the impact of the member's then-current marital issues. Again, those marital issues are being described at a point in time well after the date of assessment. Should the member in fact be unlikely ever to return to work as a consequence of marital issues, that situation arose well after the relevant date for MetLife's assessment of the claim. The member's solicitor asserts in the letter dated 27 August 2015 that 'even if the plaintiff could work (which she clearly cannot) no employment would be available to her in her circumstances'. This is not correct. The vocational assessment reports dated 10 April 2012 and 24 October 2012 identify various work options as being suitable for the member and within her education, training or experience. One report was obtained by the member's workers compensation insurer and the other was obtained by MetLife for the purposes of the TPD claims. Local labour market analysis in both reports confirmed there were advertised positions considered suitable for the member available around the area where she resided. Both Dr Smith and Dr Burek considered that that member could undertake some or all of the jobs identified in the vocational assessments. Dr Smith indicated on 1 May 2012 that the member could undertake at least three of the jobs identified and he recommended a trail job. Two months later, on 31 July 2012, Dr Smith, for reasons not explained, expressed the view that the member was at that time, incapacitated for work. An investigation report dated 20 July 2012 revealed that the member continued to play netball with the 'Benkennie Boosters' Division 4 Netball Team at Harrington Park from around April 2012 to August 2012. Surveillance revealed that the member was observed on 18 August 2012 in attendance at a local netball court wearing netball attire, and subsequently on that day, leaving hospital with her right arm in a sling and left knee bandaged. The member's participation in team netball is contrary to the functionality reported by the member to the medical practitioners who examined and reported on her during this period. Dr Smith recorded in his report dated 31 July 2012 the history provided by the member that she 'remains markedly avoidant, lacks confidence and has experienced a loss of self-esteem and self-confidence…'. This history is inconsistent with her participation in the Benkennie Boosters netball team. The member described to the medical practitioners certain barriers to her engaging in work (such as being avoidant, lacks confidence, loss of self-esteem, and self-confidence) which are inconsistent with investigation reports revealing that the member was/is an active member of the 'Boston Terrier Club of NSW', with her dog winning a number of awards including 'Best in Show' at the Royal Easter Show 2014. The member's dog has been shown at various shows in regional southern locations in New South Wales. The investigation report dated 22 May 2014 includes a photograph of the member on her Facebook profile dated 15 April 2015 holding an award with her dog. The member has also been active on social media since 2012, and a number of photographs of the member have been posted on her Facebook profile socialising with friends. Dr Burek was asked by MetLife to consider the histories given by the member to both Dr Smith and Dr Burek. Dr Burek noted that Dr Smith had taken a history of being bullied and harassed by a work colleague superior to her, and that attempts at mediation 'were most distressing to her'. Dr Burek noted that 'Dr Smith gained this information; I did not gain it. As such there is an important inconsistency in the information gained by us'. Dr Burek was asked to consider the vocational assessment report dated 24 October 2012 and the roles identified in that report of Administration Assistant, Medical Laboratory technician, Enrolled Nurse, Inquiry Clerk/Customer Service and Office Manager. Dr Burek considered that the member 'would, at some point, be capable of performing these identified work options in either a part-time or full-time capacity'. He noted at the time of his examination on 6 August 2012 she was not able to do any work at all due to her psychiatric symptomology. It was not however Dr Burke's opinion at that time that the member was incapacitated to the extent that she was unlikely to return to work of the within her education, training and experience at any time prior to reaching age 65. MetLife's decision PBRI Policy Metlife has not formed the opinion that the member had become incapacitated to such an extent as to render her unlikely ever to engage in any gainful profession, trade or occupation for which she was reasonably qualified by reason of education, training or experience at the date of assessment. The member has not provided proof of these matters to MetLife's satisfaction, as required by the Policy. Consequently no TPD benefit is payable pursuant to the PBRI Policy. FSS Policy Metlife has not formed the opinion that the member had become incapacitated to such an extent as to render her unlikely ever to engage in or work for reward in any occupation or work for which she was reasonably qualified by reason of education, training or experience at the date of assessment. The member has not provided proof of these matters to MetLife's satisfaction, as required by the Policy. Consequently no TPD benefit is payable pursuant to the FSS Policy. Dispute Resolution We note that this matter is presently the subject of litigation. Should you or the member require any clarification or further information, please direct any such request through the legal advisers.

1. As I have noted above, the Insurer begins by stating that the entitlement to receive the TPD benefit requires that the member provide proof to the Insurer's satisfaction that, as at 21 March 2011, she had satisfied the TPD definitions. In fact, the Insurer took almost exclusive control of the investigation to determine whether the TPD definitions were satisfied.
2. The most significant aspect of the letter follows the reference to Ms Wheeler's solicitor's statement, in his 27 August 2015 response, to the fact that Ms Wheeler placed reliance upon having suffered PTSD and a major depressive disorder 'from 2010 to date'. The Insurer states: The letter… misconceives the question [the Insurer] is to determine by emphasising the situation as at 2015, rather than as at the date of assessment. The letter also misconceives the question that [the Insurer] is required to consider in assessing this claim, which the solicitor describes as being 'that the plaintiff is not employable after 5 years of unemployability'.
3. The Insurer then analyses, in turn, the various reports that it had that were prepared by Dr Smith, Dr Burek and Dr Wotton.
4. As to Dr Smith, the Insurer starts by referring to the observations by Dr Smith in his 24 March 2011, 29 April 2011, 23 September 2011, 27 January 2012, 1 May 2012 and 31 July 2012 reports, which admit of the possibility that Ms Wheeler might be able to engage in work outside the Police Force at some time in the future. I have set out the relevant parts of those reports above.
5. None of those reports actually addressed the question of whether Ms Wheeler had a real chance of returning to work in an occupation other than a police officer, or whether her chance of doing so was really only remote or speculative. The issue was not dealt with in any technical manner.
6. The Insurer then refers to Dr Smith's report, dated 28 August 2014, wherein he had explained that he had changed his opinion, and that Ms Wheeler was not able, then or in the future, to undertake any of the types of employment identified by Strategic Rehab Solutions. The crucial observation made by the Insurer is: … Dr Smith's option regarding the member's capacity for work was expressed well after the date of assessment. Further, Dr Smith described a downturn in the member's emotional state well after the relevant date and in the context of her then-current marital crisis. (Emphasis added)
7. The Insurer's reliance upon Dr Burek's report focused on that part of the report in which the doctor stated that Ms Wheeler would never engage in any gainful employment, and that: "Currently treatment could be improved as I have stated in the formulation. As such she is not permanently incapacitated".
8. In relation to Dr Wotton's reports, the Insurer noted that Dr Wotton considered, in his 3 July 2014 report, that it was too early to determine whether Ms Wheeler had obtained any substantial benefit from the treatment she had recently received. The Insurer focused on the statement by Dr Wotton to the effect that: "given improvement overall has not occurred, and given that Ms Wheeler may now be facing a permanent separation from her husband, it is highly unlikely that she will ever be fit for work".

Was the rejection of Ms Wheeler's TPD claim reasonable?

1. It will be convenient to deal first with the issue of whether the Insurer's rejection of Ms Wheeler's TPD claim is invalid because, in rejecting the claim, the Insurer breached its duty to act reasonably in determining whether it was satisfied that Ms Wheeler satisfied the TPD definitions at the date of assessment.

Insurer's reliance upon medical reports of Dr Smith and Dr Wotton

1. The first question that arises, as to the reasonableness of the process of reasoning adopted by the Insurer, concerns the validity of its assertion that, because the question is whether the TPD definition is satisfied at the end of the six months period of absence from work, medical evidence as to Ms Wheeler's incapacity that is brought into existence relatively contemporaneously with the date of assessment should prevail over medical evidence, which suggests a different result, and which is brought into existence many years later.
2. On a fair reading of the Insurer's letter, it relied upon its view concerning the time of preparation of the medical reports as a separate reason for rejecting Ms Wheeler's application. That follows from the statement concerning Dr Smith's reports: "Dr Smith's opinion regarding the member's capacity for work was expressed well after the date of assessment". In relation to Dr Wotton's report, the Insurer said: "Dr Wotton's opinion is expressed at the date of his assessment of Ms Wheeler on 12 November 2014, well after the date of assessment". In each case, the Insurer prefaces the subsequent reference to the significance of Ms Wheeler's marital problems with the word "Further", which suggests that the Insurer considered the marital issue to be an additional, separate one.
3. In my view, the reports prepared by Dr Smith up to his 31 July 2012 report, would, if they had stood alone, superficially have justified the Insurer in forming the view that it was not satisfied that Ms Wheeler satisfied the TPD definitions as at the date of assessment. However, on even a reasonably close reading, those reports did not actually address the crucial question of whether Ms Wheeler had a real chance of engaging in alternative relevant employment, or whether that chance was merely a remote or speculative possibility.
4. Dr Smith's 9 September 2013 report is more equivocal, as is reflected in the fact that the Insurer's procedural fairness letter lists extracts from this report under both the evidence in support, and the evidence that does not support, headings.
5. By his 28 August 2014 report, Dr Smith explicitly rejected his own earlier opinions, and explained why he had formed the opinion that Ms Wheeler would not be able to perform the identified occupations, either then or in the future, up to the expected date of her retirement.
6. For the reasons that I have given above, it is established that whether the determination is made by the Insurer, or the court, the question is whether the TPD definitions were satisfied as at the assessment date.
7. However, the inclusion in the TPD definitions of the wording "having provided proof to our satisfaction" has the effect, as a matter of language, and practical necessity, that the relevant "proof" is the proof that the insured person is able to provide to the Insurer in the period up to the time when the Insurer makes its determination as to whether or not it is satisfied.
8. It was an error of principle, inconsistent with the proper construction of the TPD definitions, for the Insurer to discount later medical evidence in the way that it did, in favour of medical evidence that was more contemporaneous with the date of assessment. The TPD definitions require (a) that in fact the insured person has been absent from work for six consecutive months; (b) that the absence be caused by ("through") illness or injury; (c) and that the insured person has become incapacitated to the requisite extent. The authorities further establish that (d) the required incapacity must exist as at the end of the period. However, the TPD definitions do not require that it be clear at the end of the period that the insured person has the required incapacity, in the sense that the material available at that time demonstrates once and for all that the insured person is unlikely ever to engage in a relevant occupation. The question is whether the insured person is in fact incapacitated in the relevant way, and all evidence probative of that question that is brought into existence between the date of assessment and the date of the determination must be taken into account.
9. So much has been confirmed by the judgment of Leeming JA in Shuetrim at [150] and [151].
10. In my view, it was unreasonable for the Insurer to discount, on principle, the final report of Dr Selwyn Smith, and also the last report of Dr Wotton, because of the relative remoteness in time of those reports from the date of assessment, in comparison to other reports. The Insurer's determination must be found to be invalid for essentially the same reason as was given by Leeming JA in Shuetrim at [153].
11. Given that Dr Smith, in particular, had changed his medical opinion, it would have been reasonable for the Insurer to require the doctor to provide more comprehensive justification for his change of position. However, it did not do that. It simply rejected Dr Smith's opinion by preferring the opinions set out in his earlier reports.

Significance of Ms Wheeler's separation from her husband

1. If it is correct that the Insurer must give proper weight to all of the evidence received up until the time when the determination is made, having regard to the possibility that later evidence may be more accurate as to the true state of the incapacity that Ms Wheeler suffered at the end of the period of absence from work, than earlier evidence. It must therefore, remain open to the Insurer to assess whether later evidence pointing to more permanent incapacity truly reflects the level of incapacity as at the assessment date, or whether some new, intervening cause has exacerbated the incapacity.
2. On a fair reading of the Insurer's 4 September 2015 letter, it acted on the basis, in declining Ms Wheeler's claim, that the final opinions of Dr Smith and Dr Wotton stated that a reason for Ms Wheeler's permanent incapacity was the addition of the separation from her husband, to her pre-existing psychological condition. The implication is that the Insurer reasoned that Ms Wheeler was not incapacitated to the requisite degree, on the assessment date, because it was her later separation from her husband, compounded with her psychological illness, that produced that effect.
3. In my view, it was not reasonable for the Insurer to proceed upon the basis that Dr Smith and Dr Wotton had given opinions that Ms Wheeler's separation from her husband was a separate cause of her incapacity, which had made that incapacity permanent, when it was not permanent at the end of the period of absence from work.
4. The true position appears most clearly from an analysis of the changes evident between Dr Wotton's 30 July 2014 and 12 November 2014 reports. In the earlier report, Dr Wotton stated that, in February 2014, Ms Wheeler had been hospitalised for four weeks for treatment for PTSD and depression. The conclusion in that report was that it was best that Ms Wheeler be re-evaluated following her second attendance at the St John of God Adult Trauma Program. The later report revisited Ms Wheeler's condition, after she had attended that program. It was at Dr Wotton's examination of Ms Wheeler on 12 November 2014 that she advised him of her separation from her husband. In my view, as a matter of fact, the proper conclusion to be drawn is that the reversal in Ms Wheeler's psychological condition that caused Ms Wheeler to be hospitalised in February 2014 occurred by reason of her illness, as at the end of her period of absence from work, and not as a result of her separation.
5. The same conclusion follows from a comparison of the contents of Dr Smith's 9 September 2013 and 28 August 2014 reports. In the former, Dr Smith referred to the relationship between Ms Wheeler and her husband having become strained and as having deteriorated significantly. He did not say that the couple had separated. Dr Smith referred to the separation as having occurred in his 28 August 2014 report. Ms Wheeler's re-hospitalisation in February 2014 intervened. Dr Smith did not suggest in either report that the deterioration in the relationship was a new, intervening event that had caused Ms Wheeler to suffer a higher level of incapacitation than that from which she suffered at the assessment date.
6. Dr Smith said, in his 28 August 2014 report, that Ms Wheeler had not, since discharged from the Police Force, progressed well from a psychiatric point of view. He referred to the marked downturn in her mood that required readmission to the St John of God Hospital. Dr Smith did not associate this experience with Ms Wheeler's separation from her husband.
7. The Insurer may have been entitled to regard the line of reasoning that I have set out in the preceding paragraphs as being equivocal. The Insurer may have been entitled to ask for clarification by the two doctors of whether they meant to give opinions that Ms Wheeler's separation from her husband was a new cause that had led to permanent incapacity, when the incapacity was not permanent at the date for assessment. The Insurer did not do so. It was not reasonably entitled, on the evidence before it, to determine Ms Wheeler's application on the basis that both doctors had formed the opinion that the separation was an intervening cause that made Ms Wheeler's incapacity permanent.
8. The reason that I have given immediately above for concluding that the Insurer did not act reasonably in rejecting Ms Wheeler's claim, is based upon the finding that the deterioration in Ms Wheeler's psychological condition occurred before she separated from her husband, and that the two doctors did not express opinions that it was the separation that had caused Ms Wheeler's incapacity to become permanent. However, it would not necessarily follow that the Insurer's rejection of Ms Wheeler's claim was reasonable, if it was the breakdown in Ms Wheeler's marriage that was a factor that caused her incapacity to become permanent.
9. The occurrence of a marriage breakdown is not usually one that leads to either partner becoming incapacitated from work. The possibility of a marriage becoming untenable may be, unfortunately, a natural incidence of one partner suffering from PTSD and major depressive disorder. The unexplained refusal of the Insurer to communicate with Ms Wheeler as to the fate of her application for two years, may well have exacerbated her psychological condition, and facilitated the marriage breakdown. In my view, while the fact of the marital breakdown having occurred may have reinforced any difficulties of recovery that Ms Wheeler faced, it should not be regarded as an intervening event, for the purposes of the application of the TPD definitions in the Policies.

Insurer's reliance upon reports of Dr Burek

1. Next, in my view, it was not reasonable for the Insurer to rely upon the extract from Dr Burek's report, which it set out in its 4 September 2015 letter, given that Dr Burek addressed the question of whether Ms Wheeler would never be capable of engaging in a relevant occupation outside the Police Force. The Insurer ought to have appreciated that, although it had asked Dr Burek the correct question, he had in fact given an answer to the wrong one. Furthermore, Dr Burek did not address the issue of whether the likelihood that Ms Wheeler would be able to engage in relevant alternative work was a real one, or only a remote or speculative possibility.
2. Further, it was not reasonable for the Insurer to act upon Dr Burek's opinion concerning the possible effect of a change in Ms Wheeler's medication, without further exploring the question whether that change would in fact improve Ms Wheeler's employment prospects. Dr Burek expressed his opinion on 17 August 2012, after a single examination of Ms Wheeler. The Insurer rejected Ms Wheeler's application some three years later. There was more than ample time for the Insurer to advise Ms Wheeler of Dr Burek's opinion, so that steps could be taken to see whether or not Dr Burek's opinion was correct; and to enquire whether a change in medication should be explored, and if so, what its effect might be. It was not reasonable for the Insurer to rely upon Dr Burek's unexplained opinion, without having first explored the issue further.
3. Accordingly, I find that the Insurer did not act reasonably in forming the opinion that it was not satisfied that Ms Wheeler satisfied the TPD definitions, as at the date of assessment, insofar as the Insurer based its determination on the medical evidence on which it acted.

The Insurer's reliance on vocational assessment reports

1. It is then necessary to consider the Insurer's reliance on the vocational assessment reports.
2. Both of the vocational assessment reports appear to have been properly and professionally prepared, albeit on the basis of a single interview with Ms Wheeler.
3. The persons who prepared the vocational assessment reports were not competent to conduct any psychological assessment of Ms Wheeler's condition, and they did not purport to do so. Dr Smith provided a report to Strategic Rehab Solutions, after the date of its report, in which he said that he agreed that Ms Wheeler might, in the future, be capable of undertaking some of the occupations suggested in the report. At the time the Injury Treatment report was prepared, Ms Goonetilleke had available to her the same report by Dr Smith.
4. Accordingly, as at the time when the Insurer initially received both vocational assessment reports, it would have been reasonable for the Insurer to act upon them, on the basis that they were supported by adequate medical evidence.
5. However, the effect of Dr Smith's 28 August 2014 report was to remove the medical basis that had underpinned the two vocational assessment reports. Because Dr Smith had changed his medical opinion, it would have been reasonable for the Insurer to challenge Dr Smith, and to require him to justify the change of position. It was unreasonable for the Insurer to continue to rely upon the two vocational assessment reports, and ignore the change in Dr Smith's medical opinion.

The Insurer's reliance upon the investigation reports

1. The next issue to be considered is the Insurer's reliance upon the investigation reports, including Ms Wheeler's participation in netball, her apparent showing of her Boston terrier at dog shows, and her apparent socialising on Facebook.
2. The reasonableness of the Insurer relying upon its own impressions of evidence of this sort, must depend upon the relationship between the symptoms of the psychological disorders suffered by Ms Wheeler, and the extent to which those symptoms are likely to have an impact on Ms Wheeler's day to day life.
3. To take a particular example, if a builder claims that he is permanently incapacitated from working in the building trade, or any related occupation to which he is suited, by reason of a back injury, a surveillance film that shows the builder packing down in the front row of a rugby scrum may be sufficient evidence to establish, to the ordinary person's eye, that the builder's claim is false. The position may not be the same in the case of many injuries, including psychological disorders. The question is whether it was reasonable for the Insurer to rely upon its own assessment of the significance of the investigation reports, or whether it could only reasonably do so after submitting those reports for the consideration of the medical experts.
4. I will not attempt to be exhaustive, but the medical evidence suggests that both PTSD and major depressive disorder are insidious mental injuries, which can be extremely detrimental to the sufferer's ability to hold down regular employment, whether full-time or part-time; but the symptoms of the disorders are not permanently and consistently manifested. The psychological injuries may have the effect that the sufferer becomes too unreliable, too disorganised, too unsociable, and too lethargic, to be realistically employable, among other disabilities. However, when a person is suffering from these psychological disorders, what you see is not necessarily what you get. The sufferer may, at various times and periods, appear reasonably normal, and capable of engaging in many forms of employment. The presence of the psychological disorders is not necessarily inconsistent with periods of happiness and sociability. Indeed, treating psychiatrists and psychologists are most likely to advise sufferers to do their best to get out into the real world and try to live a normal life, as a remedial exercise. In short, the ordinary person cannot safely look at evidence of the occasional day to day activities of a person suffering from PTSD and major depressive disorder, and conclude that the person is not suffering from disabilities that may make the person practically unemployable, because the person is able from time to time to engage in the sort of activities of which healthy people are capable of doing.
5. It may be accepted that, speaking broadly, many of the activities engaged in by Ms Wheeler, which are depicted in the investigation reports, would reasonably support a conclusion by the Insurer that Ms Wheeler's psychological disorders did not make her permanently unemployable. However, for reasons that are not explained, the Insurer did not submit the investigation reports to any of the medical experts, in order to obtain a medical opinion that it was proper to conclude that Ms Wheeler's activities were inconsistent with the history that she had given to the various doctors, so that she was not suffering from the level of disability that she claimed to suffer from. The Insurer submitted the vocational assessment reports to the doctors, but not the investigation reports.
6. In my view, it was not reasonable for the Insurer to act upon its own assessment of the significance of the investigation reports, without first having sought expert medical opinion concerning the significance of the activities of Ms Wheeler depicted in those reports.
7. I therefore find that the Insurer failed to act reasonably in deciding that Ms Wheeler had not provided proof to the Insurer's satisfaction, that Ms Wheeler had become incapacitated, as at the date of assessment, through her illness, to such an extent as to render her unlikely ever to engage in any gainful profession, trade or occupation for which Ms Wheeler was reasonably qualified by reason of education, trading or experience. Accordingly, the Insurer's determination that Ms Wheeler had not satisfied the TPD definitions is invalid.

Did the Insurer breach its duty of good faith and fair dealing?

1. The issue that remains is whether the Insurer breached its duty of good faith and fair dealing to Ms Wheeler by reason of the manner in which it investigated and determined Ms Wheeler's application, as opposed to its reasoning in deciding that it was not satisfied that the TPD definitions had been satisfied.

The Insurer's delay in providing material to Ms Wheeler

1. The first question is whether the Insurer breached its duty to Ms Wheeler by failing to provide the evidence that it was collecting, until it did so on 13 August 2015, when it sent the procedural fairness letter to Ms Wheeler.
2. The Insurer's response to the repeated demands of the Trustee on this issue was one of almost total silence.
3. The Insurer's submission to the court on this issue was the repeated, bare assertion that the Insurer had no obligation to provide the material to the Trustee, or Ms Wheeler, earlier than it did.
4. I reject the Insurer's submission, and find that in the circumstances of the present case, the Insurer's duty of fair dealing obliged it to provide at least the primary doctors' reports, vocational reports, the transcripts of interview, and investigation reports to Ms Wheeler at a much earlier time than it did.
5. In my view, that conclusion could be supported on the basis of ordinary conceptions of fairness. However, there is a more telling basis for the conclusion.
6. The policies required Ms Wheeler to provide proof to the satisfaction of the Insurer that the requirements of the TPD benefits were satisfied as at the assessment date. The Insurer in fact took control of the investigation, as was contemplated by the terms of the Policies dealing with claims. Notwithstanding that the Insurer procured almost all of the evidence upon which it acted, it rejected Ms Wheeler's claim on the basis that she had not supplied the Insurer with the necessary proof. If Ms Wheeler had had the carriage of the investigation, the Insurer would have been required to give her the time reasonably necessary to provide adequate proof. If in fact the Insurer took carriage of the investigation, it could not deny the claim on the basis that Ms Wheeler had not provided adequate proof, in circumstances where it had not given Ms Wheeler adequate time to supply that proof. The Insurer took three years to complete the investigation. It then gave Ms Wheeler only 14 days to respond to the procedural fairness letter. Fourteen days was self-evidently insufficient. However, Ms Wheeler's entitlement to have adequate time to provide the necessary proof to the Insurer would not have been afforded to her by simply giving a much longer time for her to respond to the procedural fairness letter. That would have unfairly prolonged even further, the time taken for the Insurer to determine Ms Wheeler's claim. The only way that the Insurer could take carriage of the investigation itself, in a way that accommodated the Insurer's obligation to process the claim with reasonable expedition, and Ms Wheeler's entitlement to have adequate time to provide the necessary proof, was for the Insurer to provide the material that it had obtained earlier, and progressively, during the course of the investigation.
7. In short, the source of the unfairness is the terms of the Policies, which permit the Insurer to have the conduct of the investigation, but still require Ms Wheeler to provide the proof necessary to satisfy the TPD definitions.
8. In my view, it would be no answer to this conclusion for the Insurer to suggest that Ms Wheeler was at all times free to obtain her own evidence in support of her claim, even if that had to be done in ignorance of the material that was being collected by the Insurer. The Insurer can be taken to have been aware at all times that Ms Wheeler was a substantially incapacitated person; who was suffering from severe mental disorders; and who was unemployed and probably dependent upon workers compensation payments. The Insurer ought to have appreciated that it would be inefficient and wasteful for Ms Wheeler to be required to obtain her own material in support of her claim, without having any opportunity to understand the nature and effect of the material obtained by the Insurer, and what material in response would be helpful to her claim. (One might compare the situation where parties to litigation had to prepare their evidence in ignorance of the evidence to be relied upon by the other party, until the week before the hearing, or where one party had to disclose its evidence in advance, but the other did not).
9. In this case, the Insurer erected an impenetrable stone wall and refused to provide any material to the Trustee and Ms Wheeler, until very shortly before it declined the application. It is therefore not necessary to consider in detail, exactly what material should have been provided, and when. It is sufficient for me to say that I can see no justification for the course taken by the Insurer, and no justification has been proffered by it. I cannot see how an earlier and more comprehensive provision of material could have jeopardised the investigation being undertaken by the Insurer. The last investigator's report was dated 28 May 2014, almost one and a half years before the claim was denied. I do not think that the Insurer's desire to have the applicant investigated on numerous occasions, over a two year period, is a good excuse for withholding the results of those investigations from the applicant for a further one and a half years.

The manner in which the Insurer determined Ms Wheeler's claim

1. In my view, it is proper to deal with the issue of whether the Insurer breached its duty of good faith and fair dealing to Ms Wheeler, by considering its conduct globally. That will involve a consideration of the fact that the Insurer took three years to process and reject Ms Wheeler's claim. As considered above, the Insurer refused to provide any of the material that it gathered during the course of its investigation, for almost the whole of those three years, notwithstanding the constant and reasonable requests from the Trustee and Ms Wheeler that they be given the material for the purpose of responding to it. When the Insurer provided the material to Ms Wheeler, it only gave her 14 days to respond. Even then, the Insurer rejected Ms Wheeler's claim only days before the commencement of the hearing.
2. It would be artificial for the court to consider any of these aspects of the Insurer's determination of Ms Wheeler's claim in isolation from the others.
3. So far as the issue of bare delay in processing Ms Wheeler's claim is concerned, this is a case where, for the reasons that I have considered above, the Insurer could well have justified considerable delay on the basis that good faith and fair dealing required it to allow a reasonable time to elapse so that Ms Wheeler's psychological disorders could stabilise; and the success or otherwise of all available treatments could become apparent. This consideration may have justified a delay until a reasonable, short period had elapsed after the Insurer received Dr Smith's 28 August 2014 report, being a time sufficient for the Insurer to obtain corroboration of the basis of Dr Smith's change of opinion.
4. There does not appear to be adequate justification for the Insurer's subsequent delay until 4 September 2015.
5. However, because of the special circumstances of this case, where some considerable delay was necessary in the interests of Ms Wheeler, I would have hesitated to find that mere delay was a breach of duty by the Insurer, in the absence of the other factors that I have listed above.
6. So far as the secrecy in which the Insurer conducted its investigations is concerned, the crucial factor is that it absolutely refused to provide any material to the Trustee or Ms Wheeler, for a period of three years. It might be wrong for the court to suggest that the Insurer's duty of good faith and fair dealing required it to conduct its investigations on an open book basis, so to speak, with the Trustee and Ms Wheeler. As the Insurer provided no information, it is not necessary to explore finally what the ambit of the information that should be provided would be. In my view, the terms of the TPD definitions required the Insurer to approach the issue on the basis that, even though efficiency and its own self-interest justified it conducting the investigation itself, it could not determine the application, unless the material upon which it was going to act reasonably satisfied the description of proof provided by the applicant. The Insurer might be entitled to proceed in a commercially sensible and practical way. It would at least have to provide enough information to the Trustee and Ms Wheeler to enable them to satisfy themselves that the investigation was proceeding on a sound and fair, footing, and to give them sufficient time to obtain evidence in response to any material that was damaging to the application. As I have said above, it would have been reasonable for the Insurer to provide the primary medical reports and the instructions given to the doctors; to provide transcripts of interviews given by Ms Wheeler; to provide vocational assessment reports; and a synopsis of any surveillance activities, at least after those activities had been completed.
7. There is an obvious relationship between the amount of material that the Insurer has provided to the applicant, and the time of provision of that material, on the one hand, and the time that the applicant should be given after receipt of the procedural fairness letter, to respond to the contents of that letter, on the other. In the present case, the relationship between no material having been provided over a three-year period, and 14 days being given for the response, is to make the response time derisory.
8. The Insurer did not call any evidence to try to explain, or justify, the manner in which it processed Ms Wheeler's application.
9. It is clear that in substance, Ms Wheeler's claim was one of constructive denial. It could not have been anything else, because there had been no determination of Ms Wheeler's claim by the time her statement of claim was filed. That position remained the case for a further year.
10. The legal principles that apply to the issue of whether an insurer should be taken to have constructively denied an insured person's claim are quite different to those that apply to the issue of whether an actual determination is invalid. The former issue may, in many cases, be easier for an insured person to establish, insofar as it depends principally on the actual length of the delay, and the reasons for the delay. The task facing the insured person becomes much more difficult, once an insurer had made a determination. In the well-established way, the insurer's determination will prevail, provided that it has decided whether or not it is satisfied of the required matters in a manner that conforms with its duty of good faith and fair dealing, and to act reasonably in making the decision. It will be self-evident in most cases, as it is in the present, that the strategic pendulum will swing favourably towards the Insurer, if it makes the determination before the hearing of the claim.
11. In this case, the conclusion is inescapable that, in determining when it should make its decision on Ms Wheeler's application, the Insurer has counted back from the date fixed for the commencement of the hearing, and not forward from the date the application was made. That conclusion must be drawn, in the absence of any satisfactory explanation to the contrary from the Insurer.
12. I have dealt with a similar issue in Panos v FSS Trustee Corporation [2015] NSWSC 1217 at [235]. At least in cases such as the present, where the length of time taken by the Insurer to determine Ms Wheeler's application cannot, on the face of it, be justified, and no justification is offered, it is proper in my view for the court to find that the making of the determination, as close to the commencement of the hearing as a small number of days, and after a full year of complete inactivity, is a breach of the Insurer's duty of good faith and fair dealing to Ms Wheeler.
13. It is too plain to require explanation, that for any defendant in any proceedings to fundamentally change the juristic basis of the proceedings so close to the commencement of the hearing as one month, is likely to put the plaintiff in the invidious position of having to suffer the delay that is a consequence of an adjournment of the hearing, or to put his or her chances in jeopardy by going ahead with the hearing without adequate preparation. That is exceptionally unsatisfactory, where the plaintiff is an incapacitated person who is suing to enforce an entitlement under an insurance policy, and it is entirely within the power of the defendant to take any steps that may change the basis of the hearing early enough to enable the plaintiff to adjust properly, but for reasons of its own, it does not do so.
14. In my opinion, all of these factors taken together justify a finding that the breach by the Insurer of its duty of good faith and fair dealing to Ms Wheeler was sufficiently serious that the consequence should be that the Insurer wrongfully, constructively denied Ms Wheeler's application, before it actually rejected the application on 4 September 2015. That by itself would have justified the court in forming its own view as to whether Ms Wheeler satisfied the TPD definitions, as at the assessment date. As it has happened, however, the court is required to form its own view on that issue anyway, because the Insurer did not act reasonably in determining that it should reject Ms Wheeler's claim, for the reasons that I have given above.
15. I have not ignored the fact that Mrs Wheeler gave, as a particular of the Insurer's breach of duty, an allegation that it wrongly failed to take into account the contents of a medico-legal report dated 2 September 2015, which was prepared by Dr Selwyn Smith, and served by Mrs Wheeler on the Insurer on or about that date, when it decided to reject Mrs Wheeler's application. I will consider this report in detail below, when considering the issue of whether Mrs Wheeler has established that in fact she satisfied the TPD definitions, as at the assessment date.
16. I do not accept that Mrs Wheeler has established this aspect of her case. Mrs Wheeler's solicitor allowed the 14 days for response given in the procedural fairness letter to elapse, without warning the Insurer that Dr Smith was preparing a further report that would be served imminently. As I have said above, I have not accepted that the Insurer has proved that it made the decision to reject the application on 2 September 2015, and only dated the letter giving reasons two days later. Nonetheless, I do not accept that Mrs Wheeler has proved that a medico-legal report served by her solicitors in the litigation on about 2 September 2015 was actually brought to the attention of the persons who made the decision to reject the application in sufficient time for the Insurer to realise that it ought to have taken the report into consideration before it rejected the application.

Did Ms Wheeler satisfy the TPD definitions as at the assessment date?

1. As the Insurer's determination that Ms Wheeler is not entitled to the TPD benefits that she claims is invalid, it will be necessary for the court to decide for itself whether Ms Wheeler satisfied the TPD definitions, as at the assessment date.
2. The Insurer conceded in final submissions that Ms Wheeler has PTSD and depression, and further asserted that she has alcohol abuse disorder. It also conceded the following matters - that she is currently unemployable in any capacity for which she has relevant skill, training or experience; that she requires treatment for her symptoms; and that she is incapable of work as a police officer, or in security or investigations.
3. However, as I understand it, the Insurer maintains that it is not unlikely that Ms Wheeler will ever be able to engage in the other occupations identified in the vocational assessment reports.
4. Accordingly, the Insurer submitted that, notwithstanding all of the concessions that it has made concerning the psychological condition of Ms Wheeler, and her present incapacity to engage in any employment, the evidence does not satisfy the test that Ms Wheeler was, as at the assessment date, incapacitated by her illness to such an extent as to render her unlikely ever to engage in work of the requisite description.

The Insurer's evidence

1. In its final submissions, the Insurer relied upon all of the evidence that it had before it when it made the decision to reject Ms Wheeler's claim, and also certain additional evidence that had been prepared, or come to light, after the rejection occurred.
2. The Insurer relied upon evidence of activities undertaken by Ms Wheeler, of which it was not aware at the time it rejected her claim. It will be convenient to adopt the description of that evidence contained in the Insurer's written submissions: 25. [Ms Wheeler] has engaged in volunteer work which she has found rewarding. For some years she has been reading to her children at the Marwarra Public School. 26. It was at about 2012 she became involved in the Christmas Festival in Narellan and she ended up becoming a committee member and performing volunteer work. 27. Further, from about 2012 or 2013, her involvement with the Marwarra Public school increased, such that by March 2014 she became president of the P & C Committee and also was involved in organising a fete and a number of other fundraisers. 28. Her role as president automatically ceased with the AGM in March 2015. Nobody nominated for the position of president, and after two meetings she was again nominated and accepted the position. She remains in that position. She told the Court she was not intending to nominate at the 2016 election. 29. She also did one day's work at Sackville Primary School. 30. She told the Court she did not feel she could even hold down a part-time job. 31. The evidence is that the amount of work she performed on a voluntary capacity was limited to a couple of hours a week… Marwarra Public School P & C Committee and Public School documents were tendered as Exh 2 and 3 which demonstrated her involvement in the school and gave an indication as to the type of activity in which she was engaged. The plaintiff attended for the most part, weekly P & C meetings from March 2014 to October 2015. 32. [Ms Wheeler] said she enjoyed this work and found it fulfilling, and that she likes to make a contribution. She has missed some meetings because she felt unwell or had motivational issues.
3. The evidence bears out these submissions; they were not challenged by Ms Wheeler; and Ms Wheeler freely acknowledged them in cross-examination. As will be seen, however, further evidence puts a different complexion on these activities, insofar as they may bear on the likelihood of her ever gaining employment.
4. The Insurer also relied upon evidence given by Dr John Sydney Smith, a consultant psychiatrist, who first examined Ms Wheeler after the initial hearing was adjourned; and his evidence is called in replacement of that expected to be given by Dr Burek. Dr Sydney Smith prepared reports on 15 October 2015 and 1 February 2016. Put simply, Dr Sydney Smith suggested that Ms Wheeler had an alcohol abuse disorder, which was exacerbating the consequences of her PTSD and depression, and that there were good prospects of Ms Wheeler's current psychological disabilities being ameliorated, if she undertook available treatment for her alcohol abuse disorder. The Insurer submitted that any apparent unlikelihood that Ms Wheeler would ever engage in relevant employment ought to be displaced by the probability that the effect of the treatment would improve Ms Wheeler's condition, in a way that would make it likely, in the sense required by the term "unlikely ever", that she would gain employment.
5. Dr Sydney Smith's primary evidence was his 15 October 2015 report. He interviewed Ms Wheeler for 1 ¾ hours on 6 October 2015. Dr Smith agreed in cross-examination, that Ms Wheeler was under considerable stress at that time, because the first hearing of her claim had miscarried, due to an adjournment that had become necessary because of Dr Burek's illness.
6. Dr Smith engaged in a very extensive review of the documentary evidence concerning Ms Wheeler's psychological illness, and the treatment that she had received over the five years since she ceased work. Understandably, that approach was imposed upon Dr Smith because he had had no opportunity of examining Ms Wheeler at any time over that period.
7. In his general comments at the beginning of his report, Dr Smith said that Ms Wheeler dated her emotional decompensation to the events of 2009, "although she later conceded that she suffered an episode of depression in 2004 and had symptoms of anxiety as early as 2001". He referred to Ms Wheeler having related him an account "of her significant alcohol abuse", but said that he could find little evidence in the documents that this was ever canvassed in detail by any of further treating doctors.
8. An important part of the history taken by Dr Smith from Ms Wheeler is set out in his report at page 8, where he records: When I questioned her about her alcohol consumption she stated that she started to drink more during 2010 and it escalated once she stopped working and she has continued to abuse alcohol since. She would drink "every night to help me sleep" and would have the equivalent of two bottles of wine until she "passed out" and fell asleep. She admitted that her consumption has been to the extent that often she has been amnesic for the events of the previous night and she has also found that she had bruises on her body that she could not account for. She stated that her longest period of abstinence from alcohol was the one month that she was in St John of God Hospital in 2004 and for one month following that. She also claimed that she has told Dr Selwyn Smith about her abuse but he has never suggested that she undergo Drug & Alcohol counselling.
9. In his psychiatric assessment of Ms Wheeler, Dr Smith focused (at pages 37 to 39) on events in 2004, which Dr Smith considered were evidence of Ms Wheeler suffering from major depressive disorder, long before she began to develop symptoms of PTSD. Dr Smith expressed the following conclusion (page 45): The available evidence thus indicates that she has long suffered a Major Depressive Illness with secondary PTSD features, complicated by alcoholism. Her alcoholism has never been addressed. Her depression has not received optimal treatment… She has not been tried on any other antidepressant drug and she should be. If her depression remained refractory after such an attempt she should be treated with a combination of two antidepressant medications. A mood stabilising drug could also be added, as these seem to potentiate the effect of antidepressant medications. If such combinations do not work then she would be a suitable candidate for Electrode Convulsive Therapy. All such efforts to reduce her depression should be in combination with Drug & Alcohol Counselling. She would best be managed as an inpatient in a Mood Disorders Clinic, such as that at the Prince of Wales Hospital. I believe that as she has never received the appropriate treatment for her mental disorder, the prognosis for recovery with treatment remains high. Once she is in remission she should be able to take part in a Return to Work Rehabilitation Program. She would probably prefer not to return to police work or similar. Consequently I do not believe that she now could be classified as eligible for Total and Permanent Disability benefits either according to the Police Blue Ribbon Policy or the FSS Group Life Policy criteria. Nor could she have been so classified on 21/3/11, six months after her cessation of work on or about 21/9/10.
10. Dr Smith said in response to Dr Selwyn Smith's 2 September 2012 report (page 50): In this report Dr Selwyn Smith reiterates that she is suffering a PTSD and Major Depressive Disorder. He does not address the issue of her chronic and severe alcohol abuse. He states: "Switching to another antidepressant or introducing a mood stabiliser apart from possibly contributing to adverse side-effects will in my opinion not improve her current psychiatric condition". With this statement I totally disagree, for reasons I have expressed above. Even without a change of medication the effective control of her alcohol abuse is likely to significantly improve her current psychiatric condition. A trial of other antidepressants, possibly in combination, should be possible without the development of adverse side-effects. The addition of a mood stabilising drug would potentiate the effects of the antidepressant regime.
11. Dr Sydney Smith stated, as his conclusion, a prognosis in the following terms: "I believe that Ms Wheeler is likely to respond to the appropriate treatment of her Major Depressive Disorder and alcohol abuse. She should then be able to re-enter the workforce, at least in a part-time capacity".
12. In substance, Dr Sydney Smith took the view that Ms Wheeler's major depressive disorder was her primary ailment, and that her PTSD was secondary to her depression. He acted in the belief that Ms Wheeler drank two bottles of wine every day of her life to the point of stupefaction (except for a few short months) from the time she left work in 2010. He took the view that there were medications available, which would diminish Ms Wheeler's depression, and steps that could be taken to reduce her alcohol intake. It was on that basis that he expressed his opinion that Ms Wheeler should be able to re-enter the workforce, at least in a part-time capacity.
13. In cross-examination, Dr Sydney Smith said that for the last 10 years, he had been engaged in medico-legal practice, and had not treated any patients in that time. Prior to that, he said that he had treated possibly 20 to 30 police officers for PTSD. He accepted that he had treated insufficient police to enable him to talk in general terms about the ability of police to recover from PTSD. He accepted that 30% of persons with PTSD become chronic sufferers. However, he cannot relate that percentage to police, because he has not had enough experience.
14. The doctor accepted that he had prepared his report on the understanding that Ms Wheeler had told him that every night for the last five years, with the exception of a period of two months, she drank two to three bottles of wine a night. Dr Smith's response was somewhat equivocal in cross-examination as to whether he had in fact prepared his report on that basis (T 144 and 145).
15. Dr Smith gave the following evidence in cross-examination (at T 148 and 149): Q. You agree with Dr Smith, as I understand you, that when you saw this lady, she was totally unemployable at that time; is that right? A. Yes… Q. Yes. In your two hours with her, you saw, do we have this right, no clinical sign in her presentation to suggest to you that she was likely to go back to work at some time in the future, did you; no clinical sign? A. As she presented to me, I wouldn't have seen her going back to work.
16. As I understand Dr Smith's evidence, he did not give any opinion to support a claim that Ms Wheeler's marital problems were a new intervening cause, which had the result that she was now permanently incapacitated from employment, while she was not so incapacitated as at the assessment date.

Ms Wheeler's evidence

1. This is an appropriate point for me to say that I found Ms Wheeler to be a transparently candid witness, who unhesitatingly gave prompt and direct answers to the questions put to her in cross-examination, without any apparent regard to the consequences her answers had to the prospects of her succeeding in her case. She gave immediate and apparently truthful answers to a very substantial number of questions concerning her day to day activities, which were obviously against her own interests. I accept the evidence that Ms Wheeler gave. The Insurer did not make any submission against Ms Wheeler's credit.
2. To my eye, Ms Wheeler was distressed and emotionally upset during most of her evidence (although it is proper that I make clear, that that was a result of her psychological condition, and counsel conducted the cross-examination with all of the care that could be expected of him in the circumstances). At one point, when faced with the possibility (which did not eventuate) of having to sit through over an hour of surveillance videos of her activities, Ms Wheeler quite plainly suffered a panic attack in the witness box.
3. My observations of Ms Wheeler's apparent symptoms of her psychological condition take me no further than to conclude that her appearance was consistent with the evidence that she gave. The court must, however, rely upon the evidence of the expert psychiatrists for the purpose of determining the likelihood that Ms Wheeler will ever engage in any relevant employment.
4. I should mention that Dr Burek, in his first report, found no evidence of secondary gain on Ms Wheeler's part, which I understand to be a modern euphemism for malingering.
5. Ms Wheeler swore affidavits on 29 January 2014 and 30 September 2015.
6. In her first affidavit, Ms Wheeler substantially directed her attention to historical matters, and the underlying facts required to be proved in support of her case. She stated her current symptoms at par 29. I accept that evidence.
7. In Ms Wheeler's short, second affidavit, she gave updating evidence concerning the symptoms that she had described in par 29 of her earlier affidavit. I accept that evidence.
8. Ms Wheeler was cross-examined about her alcohol consumption (T 11 and 12) as follows: Q. The question I have for you is when you took that sick leave in September 2010, what was your alcohol consumption at that time? Do you recall? A. It's a bit hard to recall exactly because it's been so up and down, but I was I know by that stage I was drinking of a night time to help me sleep because I was having dreams and flashbacks and stuff. Q. You saw a Dr Sydney Smith in October of last year, you told him that you'd been drinking at a heavy rate for about the last six years, do you recall telling him that? A. I don't really remember saying at a heavy rate. It's not really what I would've said. Q. It's fair to say that there were times in the previous six years where you were drinking excessively is that correct? A. Yes. Q. I just want to clarify a few things, you told Dr Sydney Smith when you saw him in October that you would drink anything up to two bottles of wine in an evening, do you recall telling him that? A. I do recall on occasions, I don't do that every night. Q. That on occasions you would wake up being unable to remember the events of the night before? A. That's true, on occasions. Q. You would wake up with bruises which you couldn't explain? A. I have in the past, yes. Q. You told him you did that on occasions is that what you're saying? A. Well, it's happened in the past, he didn't actually ask me how many days that's happened or how many times. He just said, "Has it happened?" and I said, "Yes". Q. But you did tell him that that pattern of drinking had gone back about six years, is that correct? A. I don't know. Q. Whatever you told him in October, are you saying that that is the truth, what you told him in October? A. Yes, whatever I told him was the truth. I've seen so many doctors, I'm so confused as to I don't know, I can't remember anything. Q. When you say you can't remember anything A. I can't remember dates. Q. Is the best you can do that it was possible that you were on occasions drinking up to two bottles of wine per night as at September 2010/October 2010, is that what you tell the Court? A. I don't understand what you're asking, you've confused me. Q. On occasions were you drinking excessively as at September and October 2010? A. On occasions yes. Q. What about outside that occasional use, in September 2010 would you drink every night? A. In September? Q. In September 2010 were you drinking every night? A. I don't recall. I can drink nights in a row and then I can go weeks without a drink before I get stressed and then I need another one. That's the best I can answer that question. Q. Do you say that that's been the pattern over the last six years? A. Yes.
9. I accept the evidence given by Ms Wheeler that she has not, for the last five years, consumed alcohol in the amounts that Dr Sydney Smith understood her to have done. Ms Wheeler definitely did not present in the witness box as if she had consumed such an extreme amount of alcohol, for so long a period. The cause of the misunderstanding is unclear. It is likely that the misunderstanding occurred because of some false impression unintentionally conveyed by Ms Wheeler, during her short examination by Dr Smith, while she was affected by her mental disorders and the increase in anxiety that she suffered following the adjournment of the first hearing.
10. Ms Wheeler was cross-examined at length about responses she had given to questions asked by Strategic Rehab Solutions, about voluntary work that she had done at Christmas in Narellan, about her participation in the P&C committee at her children's school, about her ability to drive a motor vehicle, about her attending the local shops and doing grocery shopping and other shopping, about her playing in the local netball team, and about a holiday she took with her husband and children to London and Paris for about six weeks. As I have said, in my view, Ms Wheeler responded to the questions in a very candid way.
11. As to the holiday, Ms Wheeler said (T 51): Q. On that holiday did you feel that you drank too much, while you were out on that holiday? A. I did drink a lot, I had a lot of panic attacks. I was very uncomfortable being away so far from home. Not long after the return, I was admitted to hospital for four weeks.
12. Ms Wheeler was cross-examined about the circumstances in which she participated in the showing of her Boston terrier (T 55 and 56): Q. You'd acquired a small Boston Terrier which actually had some show potential? A. Well, I actually bought him as a pet, but when I took him back to the breeder for a visit, she said he's turned out really lovely, can we show him, so I didn't show him, she showed him. Q. It's common enough for the owner not to be the shower at a dog show; is that right? You have a show, somebody to show the dog? A. No, I've got friends that show their own dogs. Q. Did you ever involve in showing Rory yourself? A. No. Q. But you attended these shows from time to time, didn't you? A. From time to time I went to watch him. … Q. You've travelled widely with the dog showing circuit, that's correct isn't it? A. I wouldn't say widely. Q. You've been to Canberra on dog shows. A. I went down to Canberra, yep. Q. You've been to the South Coast, is that right, on dog shows? A. Yep. That's just a drive for the day, yep. Q. You've been to Queensland on the dog shows? A. Yes, once I went to Queensland, in the last three years, once. I've been to Canberra show once, and the Queensland show once. Rory goes, but I just don't go everywhere. Q. But that's something that you've found to be a satisfying activity, isn't it? You've enjoyed that activity? A. I have, yep. Q. Just out of interest, and you may be able to help me, does the name or the entity Easy Dog Entries mean anything to you? A. Is that when you enter the dogs into shows? I don't do the entries. I've never done an entry…
13. It is clear that from time to time, Ms Wheeler has been able to engage in activities that are consistent with the behaviour of ordinary and psychologically healthy people. Those activities have consistently been occasional, and relatively infrequent. The effect of the expert medical evidence was that the ability of Ms Wheeler to engage in activities of these types was not inconsistent with her being totally incapacitated from engaging in any form of ordinary employment, because of the effect of the PTSD and major depressive disorder from which she was suffering.
14. In my view, the proper course for the court to take is to rely upon the expert medical evidence, and in properly considering the evidence, to make any necessary findings concerning the effects of the mental disorders from which Ms Wheeler suffers.
15. Ms Wheeler relied on three additional medico-legal reports prepared by Dr Selwyn Smith on 2 September 2015 and 15 October 2015, and then on 9 December 2015, in response to Dr Sydney Smith's first report.
16. The opinion expressed by Dr Selwyn Smith is encapsulated in the following extracts from his 2 September 2015 report: 2. Ms Wheeler continues to display significant psychiatric disability related to her Post-Traumatic Stress Disorder, chronic in duration, and comorbid Major Depressive Disorder… There has been no significant change in Ms Wheeler's condition that would cause me to alter my previously expressed opinions in regard to her being incapacitated to undertake her former career as a police officer… I remain of the opinion that Ms Wheeler continues to be incapacitated for alternative work and in particular such occupations as suggested in the vocational capacity report namely that of insurance operator, welfare officer, office manager, investigator, security, loss prevention, control room, alarm monitoring and insurance investigator. Ms Wheeler would not be able to muster the ability to undertake such work because of her ongoing psychiatric symptoms. She lacks the ability to focus and concentrate to any extent. Her self-esteem and self-confidence have been markedly lowered. Her psychiatric disability in my opinion would be apparent to the public at large as well is any prospective employer. 4. I remain of the opinion that Ms Wheeler is presently not able to return to the workforce in any capacity, either on a full-time or part-time basis because of her psychiatric conditions. 5. At no time have I observed any clinical signs that indicate to me that there is a real chance that she will return to the workforce whether in full or part-time role in the future. Since leaving the NSW Police Force Ms Wheeler has not displayed significant improvements. My opinion accords closely with that of Dr Robert Wotton in regard to her poor prognosis pertaining to her psychiatric disorder and her ability to work. 6. It is my opinion that Ms Wheeler is incapacitated to such an extent as to render her unlikely ever to engage in or work in any occupation (either on a full-time or part-time basis) for which she is reasonably qualified by means of education, training or experience…
17. In the course of his lengthy response to Dr Sydney Smith's primary report, dated 15 October 2015, Dr Selwyn Smith said, in his 9 December 2015 report: I respectfully disagree with Dr Smith's conclusion that Ms Wheeler's Post-Traumatic Stress Disorder is secondary to her depression. Her Post-Dramatic Stress Disorder is a primary psychiatric disorder. There is no such clinical entity as a secondary Post-Traumatic Stress Disorder as stated by Dr Smith. His opinion is at striking variance with those of other clinicians who have examined Ms Wheeler, none of whom have suggested "a secondary Post-Traumatic Stress Disorder"… Dr Sydney Smith's opinion is also at striking variance with clinical personnel at St John of God Hospital Richmond who have treated Ms Wheeler. All clinical personnel have been consistent in emphasising the extent of her post-Traumatic Stress Disorder and comorbid Major Depressive Disorder. Dr Burek is also quite clear in his opinion that Ms Wheeler suffers from chronic Post-Traumatic Stress Disorder and Major Depressive Disorder… Ms Wheeler does demonstrate diagnostic criteria for an Alcohol Use Disorder. Her Alcohol Use Disorder in my opinion is secondary to her Major Depressive Disorder and Post-Dramatic Stress Disorder. The alcohol intake has fluctuated with time. It is directly related to the degree of distress she is experiencing. Ms Wheeler's alcohol utilisation has been discussed with her. As referred to in Dr Smith's own report Ms Wheeler did benefit from her inpatient stay where she was detoxified and her reliance on alcohol was discussed. It should be noted that her comorbid Major Depressive Disorder was also addressed during her inpatient stay at the hospital (Xavier Unit) during her hospitalisation… At the present time it is my opinion that Ms Wheeler is not in need of the addition of a further antidepressant… She is not a candidate for electroconvulsive therapy. She is not in need of admission to a mood disorder clinic such as the Prince of Wales Hospital. I have difficulty in accepting Dr Smith's conclusion that she has never received appropriate treatment for her mental disorder. Dr Smith has for some inexplicable reason dismissed the significant impact of her Post-Traumatic Stress Disorder has had on her. He has instead emphasised her Major Depressive Disorder that in my opinion is currently in partial remission. His opinion is at striking variance with those expressed by other experienced clinicians who have a significant and broader knowledge of Ms Wheeler's clinical state that accords closely with my own as her treating psychiatrist… Given the length of time that Ms Wheeler has experienced her psychiatric disorders and that she has been deemed to have stabilised from a psychiatric perspective by other examiners I have considerable difficulty in accepting Dr Sydney Smith's opinion that the introduction of further medication will ameliorate her symptoms. I also have marked difficulty in accepting his conclusion that voluntary work at the children's school will transfer into paid work… Dr Smith has not considered that in addition to Ms Wheeler experiencing distinctive features of a Post-Traumatic Stress Disorder and her Post-Traumatic Stress Disorder has also resulted in persistent and exaggerated negative beliefs and expectations about herself. She has experienced distorted cognitions about the consequences of traumatic events she has experienced. She has continued to experience fear, guilt and shame with a markedly diminished interest in participation in significant activities. She has avoided stimuli including social interaction to any extent, particularly in interpersonal situations that arouse recollections of the traumatic experiences. Such symptoms are also reinforced by her underlying Depressive Disorder. In my clinical experience having dealt with a large number of police officers and other patients who have developed Post-Traumatic Stress Disorder that despite intensive treatment of the type that Ms Wheeler has undergone they nevertheless continue to experience a marked degree of chronicity that significantly intrudes into their capacity to engage in productive employment. Indeed my clinical experience has revealed that only a minority of police officers are able to return to police work or engage in productive work roles on the open labour market. Often they remain unemployable, socially avoidant and expeience a marked degree of chronicity pertaining to their Post-Traumatic Stress Disorder symptoms. Many patients do not recover despite active psychiatric treatment. At best many can only undertake menial tasks. I respectfully disagree with the opinion of Dr Sydney Smith who has discounted the extent of Ms Wheeler's post-traumatic symptomatologies and the impact these, together with her depressive symptoms, are having on her capacity to reintegrate into work. The fact remains that there are some patients who do not respond to the panoply of treatment suggested by Dr Smith that he has directed to the depressive component of her psychiatric condition. He has not addressed at all the fact that she has undergone extensive treatment for her Post-Traumatic Stress Disorder at a highly regarded hospital program for Post-Traumatic Stress and has only partially ameliorated but not to the extent that she would in my opinion be capable of integrating into the open labour market. In conclusion there is nothing within Dr Smith's report that causes me to modify the original opinion is that I have expressed.
18. I found Dr Selwyn Smith to be a very impressive expert witness under cross- examination. Although he prepared a number of medico-legal reports for Ms Wheeler in the period leading up to the hearing, he was also her treating psychiatrist for a period of about five years, and treated her regularly over that period.
19. Dr Selwyn Smith was sometimes aware in detail, but in other times aware in outline, of the day-to-day activities that have formed the basis of the Insurer's case that Ms Wheeler is sufficiently capable at present, and that the court should not find that she will be unlikely ever to undertake the requisite employment. Dr Selwyn Smith was unmoved in his view that these occasional and short-term activities were not inconsistent with the basis of his opinion that Ms Wheeler has no realistic likelihood of being able to engage in any form of employment in the future. The doctor said that he encouraged these activities, because they were likely to ameliorate Ms Wheeler's suffering, as it is damaging to people with her psychological disorders to lock themselves in their homes.
20. The essential point made by Dr Selwyn Smith was that he was aware, sometimes in specific terms and in others more generally, of the activities that Ms Wheeler undertook, on days when she was feeling more hearty; and he in fact encouraged her to undertake those activities for her own good. The fact that she could engage in activities of this type intermittently was not inconsistent with her being permanently incapable of employment.
21. Dr Selwyn Smith said in examination in chief concerning his awareness of Ms Wheeler's alcohol consumption (T 99): A. Her alcohol intake has fluctuated, fluctuated wildly and it's usually directly linked to her emotional state, or adverse experiences… A. In my view, Ms Wheeler's alcohol intake is secondary to her underlying and predominant psychiatric program, namely her post-traumatic stress disorder, chronic in duration in association with a major depressive disorder. Her alcohol is predominantly used to numb her, to assist her in sleeping predominantly and that is not unusual in my experience. Q. What opinion do you have about the proposal of Dr Sydney Smith that she be sent off to drug and alcohol counsellors? At this stage at any rate? A. I don't see any particular benefit. Ms Wheeler has a good rapport with the treating personnel she's seeing. She sees me, she is open and frank. She discusses her alcohol intake… She's done three hospital programs, two of which were inpatient programmes and in my judgment, the inpatient program has been the most efficient if you will in allowing her to cease her reliance on alcohol. I think that's far superior than going to a drug counsellor who in my experience doesn't have the broad experience of a psychologist or psychiatrist, who can deal if you will with co-morbid conditions. Q. Is it likely to assist her with her PTSD? A. No.
22. Dr Smith's fundamental disagreement with Dr Sydney Smith was in his opinion that the primary disorder was PTSD (T 100). He said that there is no such clinical entity as secondary PTSD.
23. Dr Smith explained in detail (T 101) why he disagreed with Dr Sydney Smith's opinion that Ms Wheeler's condition would be improved if she was placed on a combination of additional antidepressants. He said: "… it is often times dangerous to combine medications, and in my judgment there is really no firm reliable scientific evidence that it is effective. Dr Smith refers to a stacking approach of addition (sic) more medications, increasing the dosage, and in my judgment that is likely to result in adverse effects. Ms Wheeler is already experiencing adverse effects. She's gained weight. She did gain weight with the Avanza of 16 kg. There's been sexual dysfunction. I'm concerned about her weight again, which carries a risk of metabolic syndrome, diabetes, and there is a very serious condition, particularly with antidepressants which one must always be cautious of, of serotonin syndrome. Particularly when you raise levels of antidepressants, serotonin is the chemical in which you're attempting to raise at the nerve ending, synapses in the brain. If you are not careful and you raise the levels too high, the patient would experience significant side-effects, if not death. There are a whole host of other adverse effects, I'm talking about neuroleptic syndrome, I could go on and on but the side effects of these drugs are significant…
24. Cross-examined about Ms Wheeler's volunteering to read at her son's school, Dr Smith said (T 104): A. I was encouraging Ms Wheeler as were others to engage in some activity to get her out of the house, she was becoming housebound, volunteer activity. The involvement in the school was a key step for her, but one should also emphasise the importance of that was also related to her need to be close to her children. She was given the background extremely concerned for the well-being of her children. She had been exposed to a number of deaths involving children. She was fearful that her children would be harmed and so in engaging in the school in a voluntary capacity with the P & C committee she did, it was a method if you will of being close to the children and ensuring the children were safe. And in that sense it helped her and I encouraged her.
25. Questioned about his agreement to an arrangement suggested by Ms Gow, of Strategic Rehab Solutions, that Ms Wheeler undertake voluntary work for up to 10 hours a week at the Sackville Road Primary School, Dr Smith said (T 106): A. The clinical problem Ms Wheeler is confronted with pertains to a markedly fluctuating picture. There are some days when she has the capacity to make an effort and mobilise herself and get up and do what she is supposed to do and there are other days when she is quite immobile and she is withdrawn and she is isolated and she doesn't want to move at all other than just to stay at home in her pyjamas. My recollection is that she could not engage in that school activity she was down. She had no motivation, no drive, and it wasn't possible for her.
26. Asked about whether he enquired about Ms Wheeler's alcohol consumption, Dr Smith said (T 107): A. Yes. I would enquire about her alcohol. I know Dr Sydney Smith's made an issue that I haven't enquired. This is not true. I would always ask her about her alcohol intake, which was a frank question I would ask patients, because it's important, and she would reply. To me, I accepted what she was telling me. I didn't think she was distorting how much. Sometimes she tells me she was drinking a lot, two or three bottles at a time. Sometimes just two or three gin and tonics, and it varied.
27. When it was put to him that the issue in dispute between himself and Dr Sydney Smith was whether alcohol use exacerbated Ms Wheeler's PTSD, or vice versa, Dr Smith said (T 109) A. It's not a fair comment at all. If you look at the progression of her exposure to traumatic events, there is no question in my mind that the prime diagnosis is post-traumatic stress disorder followed by an emerging depressive disorder of a major kind. That's where we differ.
28. Dr Smith agreed that the presence of the alcohol abuse disorder did complicate the clinical picture.
29. Asked about his knowledge of Ms Wheeler's involvement with her children's School, Dr Smith said (T 117): "I knew she was involved in the school in a variety of ways, reading and being near her children, and serving on committees… But it was a minimal extent, and the prime thrust was to be near her children". When it was put to him that he may not have been told by Ms Wheeler of all of the activities in which she was engaged, Dr Smith said (T 118): A. That may well be. That's what I was told, that's what I've reported. Be that as it may, if I may; irrespective of all the activities you've mentioned, chaired a meeting, went to the fetes et cetera, I made the point that irrespective of whatever activities she was doing as a volunteer, this would not translate into paid work because of her problems, and I still maintain that.
30. Dr Smith's cross-examination ended with an investigation of whether Ms Wheeler may not have informed Dr Smith of all of the day-to-day activities in which she engaged, because Ms Wheeler hoped to make a secondary gain. Dr Smith responded by stating (T 119): "but if you are asking my opinion do I consider Ms Wheeler malingering or prone to secondary gain, no I don't buy that, don't accept that at all".
31. Ms Wheeler called Dr Wotton to give evidence, and relied upon the reports that Dr Wotton provided to the workers compensation insurer. Dr Wotton was called to the witness box, but the Insurer made the election not to cross-examine Dr Wotton. The Insurer did not challenge the views expressed by Dr Wotton in his reports. It did not suggest that those opinions were based upon any unreliable history given by Ms Wheeler to Dr Wotton. It was not put to Dr Wotton that Ms Wheeler's marital problems were the cause of her incapacity becoming permanent.
32. I prefer the evidence given by Dr Selwyn Smith and Dr Wotton to that given by Dr Sydney Smith.
33. In forming that preference, I have been substantially influenced by the fact that Dr Selwyn Smith has been Ms Wheeler's treating psychiatrist for a period of five years. Over that time, he has given a significant number of reports to various different correspondents, and it has been only relatively recently, that he has been qualified in addition as a medico-legal expert for Ms Wheeler. In cases such as the present, the regular and long-term exposure of the treating psychiatrist to the patient is likely to make the treating psychiatrist's evidence more reliable and valuable for a number of reasons. First, the treating psychiatrist will have a longitudinal perspective. Secondly, by reason of the substantial number of examinations, the treating psychiatrist will not be dependent upon the history given by the patient in a few short examinations. The treating psychiatrist will have had an opportunity to witness the symptomatology of the patient over a considerable period. The treating psychiatrist will have a working understanding of the clinical notes of other treating professionals, such as those at the St John of God Hospital.
34. Further, I am not persuaded by the reasoning behind Dr Sydney Smith's opinion, that the primary disorder suffered by Ms Wheeler is major depressive disorder, to which her PTSD is secondary. I accept Dr Selwyn Smith's opinion on that issue, which appears to be consistent with what has been stated in all of the other medical reports that are in evidence. Consequently, I reject the suggestion that Ms Wheeler's prospects of gaining relevant employment in the future will be enhanced by her being given a new regime of treatment for her depression. I accept that that is a matter for the treating psychiatrist, and I am persuaded that Dr Selwyn Smith is well aware of the risks involved in increasing her medication, for what is in fact the secondary disorder, so that it is unlikely that Ms Wheeler's treatment regime will be changed.
35. I find that Dr Sydney Smith's opinion that alcohol abuse disorder is a substantial cause of Ms Wheeler's symptomatology, so that her employment prospects will be improved, if she receives additional treatment for alcohol abuse, is based upon a false assumption, as to the extreme level of alcohol consumption in which Ms Wheeler has engaged over a period of some five years.
36. I am satisfied that the medical evidence establishes that, over the period of what is now more than five years since the cessation of Ms Wheeler's employment with the Police Force, enough time has elapsed, and enough treatments have been given to Ms Wheeler, to support the medical opinion that her psychiatric condition has stabilised, and is unlikely to be substantially improved by further treatment or medication. Unfortunately for Ms Wheeler, it has turned out that she is one of the 30% odd of persons who suffer from PTSD whose condition becomes chronic.
37. I am also satisfied that the evidence that has been put before the court that shows that Ms Wheeler is capable, on an irregular basis, of engaging in activities that would, in the case of psychologically healthy people, is not for medical reasons inconsistent with her claim that she satisfied the TPD definitions as at the assessment date.

Shuetrim

1. As the decision of the Court of Appeal in Shuetrim appears to have brought about a change in the accepted meaning of the expression "unlikely ever" in the TPD definitions, and as the decision contains some guidance as to how the issue of whether the definitions have been satisfied should be determined, it is perhaps appropriate that I specifically address the reasons why the outcome for Ms Wheeler in this case is different from that experienced by Mr Shuetrim.
2. As I have discussed above under the heading "What is meant by unlikely ever?", the question is whether there is a real chance that the applicant will return to relevant work over the balance of the applicant's expected working life, even if it is less than 50%, where a real chance must be a possibility which is not remote or speculative. Leeming JA, at [89], likened a real chance to a possibility which is "readily contemplatable". It is necessary to address the significance of these principles to the present case.
3. One similarity between Ms Wheeler's and Mr Shuetrim's cases is that the former had a remaining expected working life of 29 years, and the latter 30 years. Both applicants were relatively young, in terms of Leeming JA's observation at [208] that: … Relatively young people whose medical or psychological condition is uncertain will find it harder to prove to an insurer's or a court's satisfaction that they are unlikely ever to return to work for which they are reasonably fitted by education, training or experience.
4. In Shuetrim, as appears from the judgment of Stevenson J at [21], [83], [99] and [100], Mr Shuetrim suffered from lateral epicondylitis (or "tennis elbow") and a secondary anxiety and adjustment disorder, which were injuries caused by the way he was treated by his fellow members of the Police Force, after he suffered his orthopaedic injury. In Ms Wheeler's case, it was the unanimous opinion of the psychiatrists who were called to give evidence that, as at the date of the hearing, Ms Wheeler was totally incapable of engaging in any occupation, by reason of chronic PTSD and major depressive disorder, and the issue was as to which expert opinion should prevail as to whether there was any prospect of her recovering sufficiently to be able to undertake some form of relevant employment, by reason of additional therapy or changes to her medication.
5. It is instructive to look not only at what Leeming JA said concerning the meaning of the relevant TPD definitions, but also what he did in determining that they were not satisfied. Ultimately, Leeming JA found at [209] that he did not consider that the evidence supplied by Mr Shuetrim satisfied him that Mr Shuetrim was, as at the relevant assessment date, "unlikely ever to return to relevant work (which is to say in an occupation for which he was qualified by education, training or experience, even if only on a part-time basis). His Honour reached that conclusion by the following process of reasoning: 1. He found that Mr Shuetrim had exaggerated his physical and mental conditions in his evidence: see [192], [198] and [199]. 2. He found that the thrust of the medical evidence was that Mr Shuetrim's left elbow was "almost certain to improve over time": see [200]. His Honour noted that he had to "bear in mind that the question is one of 'unlikely ever', which requires an opinion as to the extent (if any) Mr Shuetrim will recover use of his dominant left arm over the remainder of his working life". 3. He regarded the evidence of Mr Shuetrim's general practitioners "to be a relatively powerful consideration", and preferred the evidence of those general practitioners who in effect expressed the view that there was hope for employment in the future: see [201] to [203]. 4. He noted that the evidence of the medical practitioners took the form of the tender of their reports without cross-examination: see [205]. The reports were therefore admissible for all purposes, and it was for the court to weigh the cogency of the competing opinions. 5. In dealing with the psychiatric evidence at [207], his Honour noted that Mr Shuetrim had exaggerated his claims and "to the extent that the history provided by Mr Shuetrim is exaggerated, the psychiatrists' opinions proceed on an incorrect premise". 6. He noted that ultimately, the onus was on Mr Shuetrim "to provide evidence sufficient to support the opinion required by the TPD definition, which is an opinion concerned with the remainder of his working life": see [207]. 7. Finally, at [208], his Honour noted the difficulty, which I have extracted above, that young people whose medical and psychological condition is uncertain will have difficulty in satisfying insurers and the court that they have satisfied the TPD definitions.
6. Relevantly, in Ms Wheeler's case the following considerations apply: 1. While the Insurer in the present case relied upon much the same sort of evidence concerning Ms Wheeler's day to day activities that the insurers in Mr Shuetrim's case successfully relied upon to establish that Mr Shuetrim had exaggerated his claims, I rejected their submission to that effect in Ms Wheeler's case. I found that Ms Wheeler did not exaggerate her physical and mental conditions. She was candid about the day to day activities she was able to achieve. 2. Importantly, in Ms Wheeler's case, the psychiatrists who had prepared reports on her mental and consequential physical condition, and her prognosis for recovery, were called to give evidence, and were cross-examined. One significant consequence was that it was established in her case that the psychiatrists' opinions did not proceed upon an incorrect premise, because, particularly in the case of Dr Selwyn Smith, the treating psychiatrist did not alter his expert opinion, even where he was aware of the activities upon which the Insurer's case relied upon. In Ms Wheeler's case the risk that lay opinion would be misled by unwarranted reliance upon evidence that Ms Wheeler was capable of engaging in certain activities in the same way as healthy people was dispelled by positive expert evidence that the ability to engage in that conduct was not inconsistent with total incapacity for employment caused by Ms Wheeler's psychiatric conditions. 3. Mr Shuetrim suffered from 'tennis elbow', and the expert evidence supported the conclusion that the disability was almost certain to improve over time, particularly when time was viewed in terms of a 30 year working life. The expert evidence that I accepted supported the conclusion that Ms Wheeler's injury was chronic and had stabilised, and there was no reason to believe it would improve at any time in the future. Consequently, the possibility of improvement was rationally only a matter for speculation. 4. In Ms Wheeler's case, the equivalent evidence to that given by Mr Shuetrim's general practitioners was the evidence of Ms Wheeler's long-term treating psychiatrist, Dr Selwyn Smith. His evidence comprehensively supported Ms Wheeler's claim, after allowance is made for his change of opinion following the failure of all treatments to cause an improvement in Ms Wheeler's symptoms. 5. Consequently, in Ms Wheeler's case, it would have been a matter of intuitive speculation to draw a conclusion that there was a real likelihood that Ms Wheeler's capacity would improve over the remainder of her working life that would be sufficient to give her a real chance of obtaining relevant employment.

Conclusion

1. I conclude that the evidence justifies a finding that, as at the assessment date, Ms Wheeler was incapacitated to such an extent as to render her unlikely ever to engage in any gainful profession, trade or occupation for which she was reasonably qualified by reason of education, training or experience, within the meaning of the TPD definitions in the Policies.
2. Ms Wheeler is therefore, entitled to appropriate orders to ensure that she receives the TPD benefits to which she is entitled, together with any interest to which she is also entitled. The Insurer must pay Ms Wheeler's costs of the proceedings.
3. The parties are to bring in short minutes of order to give effect for these reasons for judgment. If agreement can be reached, I will make the orders in chambers. If not, the matter can be relisted by arrangement with my associate.

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