New South Wales Court of Appeal CITATION : HARPLEY v. QBE INSURANCE LIMITED [1999] NSWCA 145 FILE NUMBER(S) : CA 40428/97 HEARING DATE(S) : 14 May 1999 JUDGMENT DATE : 14 May 1999 PARTIES : GEOFFREY RUSSELL HARPLEY (APPELLANT) QBE INSURANCE LIMITED (RESPONDENT) JUDGMENT OF : Meagher JA at 22, 24; Powell JA at 1; Beazley JA at 23 LOWER COURT JURISDICTION : District Court LOWER COURT FILE NUMBER(S) : DC 1/95 (Temora) LOWER COURT JUDICIAL OFFICER : McLachlan DCJ COUNSEL : E.G. Romaniuk (Appellant) J. Stoljar (Respondent) SOLICITORS : Farrell Lusher (Wagga Wagga) by their City Agents Turner Whelan (Appellant) Henry David York (Respondent) CATCHWORDS : INSURANCE - Policy - Personal accident and sickness - Exclusions - Injury caused directly or indirectly or resulting from insured "engaging in or taking part in ... professional sporting activities". DECISION : Appeal dismissed 6 IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40428/97 DC 1/95 (Temora) MEAGHER JA POWELL JA BEAZLEY JA 14 May 1999 HARPLEY v. QBE INSURANCE LIMITED JUDGMENT 1 POWELL JA: This is an appeal brought by an unsuccessful plaintiff from a judgment delivered by McLachlan DCJ in the District Court on 29 August 1997. 2 In those proceedings the Appellant sought to recover from the Respondent, by way of debt, moneys to which he claimed to be entitled pursuant to the provisions of a policy of insurance which had been issued by the Respondent originally in June 1992 and renewed in June 1993, that policy being a policy in the nature of a personal accident and sickness policy. 3 The insuring part of the policy was in the following terms:- "1.1. In consideration of the payment to QBE Insurance Limited (hereinafter called "QBE") of the amounts payable for this Insurance, QBE will pay Compensation to you, the Insured named in the Schedule, or other person nominated in writing by you in accordance with this Policy if any of the Events referred to in the Schedule shall happen to the Insured Person specified in the schedule." 4 Under the title "DEFINITIONS", the policy provided: - "3.1 'Compensation' means the sum set out in the Schedule against the relevant event … ……… 3.2 'Injury' means bodily injury to the Insured Person caused solely and directly by violent accidental, external and visible means. ……… 3.4 'Permanent Total Disablement' means Temporary Total Disablement which has lasted for at least one calendar year from the date of injury which caused the disablement and thereafter prevents the Insured Person for the remainder of his or her life from engaging in any occupation profession or business for which he or she is reasonably qualified by education training or experience. ……… 3.6 'Temporary Total Disablement' means total disablement which prevents the Insured Person from carrying out all the normal duties of his or her usual occupation, profession or business or where the Insured Person engages in more than one occupation, profession or business, all of the ………" 5 Under the title "THE COMPENSATION" the policy provided:- "Injury (as defined) occurring during the period of insurance and within one calender year resulting solely and directly and independently of any other cause in …" and then there were enumerated various "Events" including permanent total disablement temporary total disability. 6 Under the title "EXCLUSIONS" the policy also provided: "This Policy does not apply to any event which is caused directly or indirectly by or which results from:- ……… 6.2. The Insured Person engaging in or taking part in: ……… (a) professional sporting activities. ………" 7 It is the exclusion provision to which I just referred upon which the fate of these proceedings turns. 8 The Appellant, who, at the relevant time, was about 24 years of age, was by trade a butcher, a trade which, at the time of the accident to which I will shortly refer, he carried on in partnership with his father in the town of Temora. However, in addition to the trade of a butcher which he carried on, the Appellant was also engaged in the sport of harness racing - or trotting - a sport which, in this State, was, at that time, conducted subject to the supervision of the Harness Racing Authority ("the Authority"). 9 At the age of seventeen years, the Appellant had obtained from the Authority a licence to train and to drive in races which were conducted by racing clubs or associations which were subject to the supervision of the Authority. For that purpose, the Appellant paid the appropriate licence fee, which licence fee as I understand the Appellant's evidence (Black AB 41) (but see Workers Compensation Act 1987 s.3(1) "worker", s.5, Schedule 1 cl 9(1)(b); see now Workplace Injury Management and Workers Compensation Act 1998 s.4(1) "worker", s.5 Schedule 1 cl 9(1)(b); cp. Sporting Injuries Insurance Act 1978) carries with it a component representing a premium for a personal accident policy issued to all trotting drivers driving in the sport of professional trotting. 10 Thereafter, and up to the time of the accident, the Appellant was involved in the sport of trotting, partly as a part owner of trotting horses, but, as well, in the roles of both a trainer and a driver. These latter two activities entitled the Appellant, when having trained, or having driven, a trotter, not owned by him, which won a prize at any trotting meeting to receive a defined percentage of the prize money. That money appears to have been distributed by the Authority to the owners, trainers and drivers in certain defined proportions, trainers and drivers receiving in their several capacities 5 per cent of the appropriate prize money. 11 At the time of the accident - which was in December 1993 - the Appellant was exercising a trotting horse at the Temora Showground. The evidence makes it abundantly clear that, as part of the process of training a horse and fitting it for racing, it is necessary to exercise it on a regular basis. That being so, the Appellant must be regarded as, at the time, taking part in one of the activities of a trainer-driver of trotting horses, even though the accident did not occur in the course of a race but occurred on a day other than a race day. 12 Although I do not claim fully to understand the detail of how the accident occurred, it is clear that, as the result of something which occurred during the course of the horse being exercised, the Appellant was thrown from the trotting gig and suffered significant injuries to his back. At first, it was thought that he sustained paraplegia; although his condition has since ameliorated, he is nonetheless still to be regarded as a permanently disabled man, and he is in receipt of some form of disability pension. 13 Accordingly, if the injury which the Appellant sustained did not fall within the exclusion clause in the policy to which I have referred, he was, as was conceded at the trial, entitled to recover under the policy, the amount then agreed to be of the order of some $60,000. 14 I regret to say that, at the trial, the parties seemed to have devoted a great deal of time to issues which, as it seems to me, did not need to be addressed unless, and until, it became apparent that the injury would fall within the principal insuring clause in the policy - those issues related to non-disclosure and raised interesting questions pursuant to the provisions of ss 21 and 28, in particular, of the Insurance Contracts Act, 1984 (Cth). 15 In the event, as the result of the way in which the trial was conducted, McLachlan DCJ devoted a considerable part of his judgment to dealing with those questions of non-disclosure and the consequences of non-disclosure, that consideration leading his Honour ultimately to conclude that there had been a relevant non-disclosure, and that, in the circumstances, the Respondent was entitled to disclaim liability under the policy. 16 It was in respect of his Honour's findings in those terms that the Appellant sought to appeal to this court. 17 By Notice of Contention submitted that the judgment delivered by his Honour should be affirmed upon the grounds, first, that, upon the true construction of the policy, the policy excluded any event caused directly or indirectly by the Appellant engaging in or taking part in professional sporting activities; and, second that the Appellant's injuries were caused by, and resulted from, his engaging in or taking part in professional sporting activities namely professional harness racing. 18 Mr E.G. Romaniuk who appears today for the Appellant has said all that could possibly be said on behalf of the Appellant in support of the appeal, but, in my view, the Appeal should be dismissed, and the judgment below affirmed, upon the simple ground that the Appellant's activities which led to his injuries were activities in the course of professional sporting activities. 19 That the Appellant himself, at least at one time, so regarded it is made clear by the terms of a statement (Exhibit 4 - Blue AB 41) which, in March 1994, he gave to a Mr Gersbach, an investigator. In the course of that statement, the Appellant said:- "To the best of my knowledge everything I disclosed for the proposal was the truth. I disclosed details of the amateur sport I played and I also ticked the yes box for the question "8. Do you play any sports (Professional Sports are excluded)". I did not mention my trotting driving and training activities as I believed that this was a professional part of my sporting activities and was therefore not required to be specified due to the bracked (sic) comment (Professional Sports are excluded)". 20 Quite apart from the statement provided by the Appellant to Mr Gersbach the additional evidence that was tendered at trial provides ample support for that view of the Appellant's activities. In this respect I need only note the detailed Schedule (Exhibit 3 - Blue AB 26-39) which has been provided from the records of the Authority, which Schedule details the various payments made to the Appellant (inter alia) in his capacities as trainer and driver over the years prior to the accident. 21 It is, regrettably, my view that, for this reason, the appeal should be dismissed with costs. 22 MEAGHER JA: I agree. 23 BEAZLEY JA: I agree. 24 MEAGHER JA: The order of the Court therefore is that the appeal is dismissed with costs. ***** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.