Tuua v Savings Australia Pty Ltd as Trustee for Superannuation Trust of Australia [2006] FCA 1816

FEDERAL COURT OF AUSTRALIA

Tuua v Savings Australia Pty Ltd as Trustee for Superannuation Trust of Australia [2006] FCA 1816

FAATIUGA TUUA v SAVINGS AUSTRALIA PTY LTD AS TRUSTEE FOR SUPERANNUATION TRUST OF AUSTRALIA AND COLONIAL MUTUAL LIFE ASSURANCE SOCIETY LTD QUD 240 OF 2006

DOWSETT J

15 NOVEMBER 2006

BRISBANE IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY QUD 240 OF 2006

ON APPEAL FROM THE Superannuation Complaints TRIBUNAL

BETWEEN: FAATIUGA TUUA

Appellant

AND: SAVINGS AUSTRALIA PTY LTD AS TRUSTEE FOR SUPERANNUATION TRUST OF AUSTRALIA

First Respondent

COLONIAL MUTUAL LIFE ASSURANCE SOCIETY LTD

Second Respondent

JUDGE: DOWSETT J

DATE: 15 NOVEMBER 2006

PLACE: BRISBANE

REASONS FOR JUDGMENT 1 These proceedings purport to be an appeal pursuant to s 49 of the Superannuation (Resolution of Complaints) Act 1993 (Cth) (the "Act") from a decision of the Superannuation Complaints Tribunal, established under that Act. 2 The appellant was born on 10 January 1945 and commenced employment on 4 May 1994. On 16 May 1994, he completed an application to join a superannuation fund conducted by the first respondent. As an aspect of the conduct of that fund, the first respondent offered cover for incapacity from work using a life insurance policy effected with the second respondent. When the appellant applied for superannuation cover, he also applied for four units of insurance cover and, in connection with that application, completed a personal health statement. Had he not so applied, he would have automatically been entitled to two units of insurance cover. In order to acquire the additional two units it was necessary that he complete the health statement. 3 In completing that statement, he ticked a box which indicated that he had never suffered from diabetes, asthma, or epilepsy. This was untrue as he had a history of diabetes. It is not necessary to go into the circumstances in which this misrepresentation occurred. However there were numerous statements on the application form which should have alerted him to the need to make full and honest disclosure. 4 On 22 September 1998 he suffered a back injury at work. He stopped working on 7 October 1998 at age 53. His employment ceased on 3 November 1998. On 21 April 1999 he applied for a benefit pursuant to the policy. In 2004 he was paid a benefit equivalent to two units of cover, the insurer having terminated the policy insofar as concerns the other two units upon the basis of fraud. The first respondent appears to have adopted the insurer's decision, and to have also elected not to pay any benefit beyond the two units. It is not disputed that such decision was a decision to which the Act applies. 5 Pursuant to s 29 of the Insurance Contracts Act 1984 (Cth) (the "Insurance Contracts Act"), an insurer may avoid a contract for fraud and, pursuant to s 31(1), a court may relieve the insured from that consequence. In the Tribunal, the appellant sought to rely on s 31. Clearly, the Tribunal is not a court. Whichever courts may be invested with jurisdiction pursuant to s 31, the Tribunal is not one of them. It so found and, having found fraud on the part of the appellant, upheld the insurer's decision. 6 Pursuant to s 39 of the Act, the Tribunal had power to refer to the Court, on its own initiative or at the request of a party, any question of law arising in relation to a complaint. The appellant did not ask the Tribunal to follow this course. There is no reason to believe that the Tribunal considered the possibility of so doing. 7 The appellant now submits that the Tribunal erred in law and so brings this appeal. An appeal lies only on a questions of law. The appellant submits, firstly, that as the matter is now before this Court on appeal pursuant to the Act, the jurisdiction of the Court is engaged, and I may now grant relief pursuant to s 31 of the Insurance Contracts Act. Whilst, as a matter of theory, it may be open to the Court to proceed in that way, all relevant parties being before it, I would be very reluctant to adopt that course over the opposition of any party. The respondents resist it, saying that this is an appeal, and that it is not appropriate that the jurisdiction of the Court be engaged in this indirect way. I am inclined to accept that submission, particularly as I believe that so to proceed would be likely to raise problems which cannot easily be foreseen at this stage, particularly as to findings of fact and the consideration of facts relevant to an order pursuant to s 31. 8 Secondly, the appellant submits that the Tribunal in fact referred a question of law to this Court, that question being the availability of relief pursuant to s 31. I am unable to construe any aspect of the Tribunal's reasons as having that effect. In any event, I do not consider that it would have been open to the Tribunal to refer to this Court the question of the availability of relief pursuant to s 31 of the Insurance Contracts Act in exercise of the power conferred upon it by s 39 of the Act. The availability of relief pursuant to s 31 is a discretionary matter, depending upon the proper construction of the section and the facts of the case. Whilst there are questions of law involved in that process, it is not purely a question of law. It is therefore not, in my view, a question of law for the purposes of a reference pursuant to s 39. 9 Thirdly, it is suggested that the Tribunal made an error of law in not referring the matter to this Court. It follows from what I have said that I disagree with that view. There was no error of law in failing to refer. The question was not one which could be referred. As I understand s 39, which is in a form not uncommon in legislation, the purpose and function of the procedure is to allow a pure question of law, arising in the course of proceedings in a Tribunal, to be referred for determination. It is not intended to be a launching pad for some sort of collateral proceedings which may involve questions of law and questions of fact similar to those being canvassed in the Tribunal. 10 The appellant ought to have commenced proceedings for relief pursuant to s 31 of the Insurance Contracts Act and, as far as I can see, that course is still open. I do not think it appropriate or permissible that the appellant should seek that relief by turning an application by way of appeal on a question of law into proceedings pursuant to s 31, given the respondents' opposition. 11 The appeal will be dismissed. I order that the appellant pay the respondents' costs of the proceedings, including reserved costs. I certify that the preceding eleven (11) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Dowsett.