New South Wales Supreme Court CITATION : Kenan Berk v Westpac Securities Administration Ltd & Anor [2010] NSWSC 28 HEARING DATE(S) : 07.09.09, 08.09.09, 09.09.09, 10.09.09, 11.09.09 JUDGMENT DATE : 4 February 2010 JUDGMENT OF : Nicholas J DECISION : par 140 CATCHWORDS : INSURANCE – claim for benefit – whether defendants entitled to avoid policy for fraudulent non-disclosure or fraudulent misrepresentation – whether condition of total and permanent disability established – whether plaintiff entitled to relief – turns on the facts – no questions of principle LEGISLATION CITED : Insurance Contracts Act 1984 (Cth) CATEGORY : Principal judgment Gould v Vaggelas [1985] HCA 75; (1985) 157 CLR 215 Ivkovic v Australian Casualty & Life Ltd (1994) 10 SR (WA) 325 Jones v Dunkel [1959] HCA 8; (1959) 101 CLR 298 CASES CITED : Luxton v Vines [1952] HCA 19; (1952) 85 CLR 352 Nile v Club Plus Superannuation Pty Ltd & Anor [2005] NSWSC 55 Sayseng v Kellogg Superannuation Pty Ltd & Anor [2003] NSWSC 945 Tyndall Life Insurance Co Ltd v Chisholm [2000] 11 ANZ Ins 90-104 Kenan Berk - plaintiff PARTIES : Westpac Securities Administration Ltd – first defendant Westpac Life Insurance Services Ltd – second defendant FILE NUMBER(S) : SC 6025/07 COUNSEL : D E Baran - plaintiff R M Smith SC/N J Owens - defendants SOLICITORS : Sachs Gerace Lawyers - plaintiff Corrs Chambers Westgarth - defendants IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION Nicholas J 4 February 2010 6025/07 Kenan Berk v Westpac Securities Administration Ltd & Anor JUDGMENT 1 His Honour: The plaintiff seeks a declaration that the decision of the first and second defendants (Westpac) denying him payment under the Westpac Term Life policy of insurance no L0900964 (the policy) of a lump sum benefit for total and permanent disability is void. He also claims an order for payment under the policy of the sum of $500,000 with interest. 2 Westpac claims that, pursuant to s 29(2) Insurance Contracts Act 1984 (Cth) (the Act) it was entitled to avoid the policy because the plaintiff fraudulently failed to comply with his duty of disclosure and/or fraudulently made misrepresentations in the application for insurance and in the related personal statement. 3 Alternatively, Westpac denies entitlement to the disability benefit under the policy on the ground that the plaintiff did not satisfy the relevant conditions for payment. The policy and the claim 4 The first defendant was at all material times the trustee of the Westpac Personal Superannuation Fund. By application dated 4 February 2002 the plaintiff applied for term life and total and permanent disability cover following which the policy issued on 27 March 2002. It provided death benefit in the sum of $500,000, and benefit for total and permanent disability for "any occupation" in the sum of $500,000 (the TPD benefit). The premium was $1,291.20. 5 It was undisputed that the policy was a contract of life insurance within the meaning of s 29 of the Act. 6 The requirements of the TPD benefit were defined in cl 20 of the policy which, relevantly, provided: "20. When we will pay you 20.1 If an Insured Person is totally and permanently disabled by any injury, disease or sickness, we will pay you their disability benefit as a lump sum. The meaning of 'total and permanent disability' depends on the type of disability benefit which applies under the policy for that Insured Person. … 20.3 If an 'Any Occupation' benefit applies, 'total and permanent disability' means: An injury, disease or sickness which has prevented the Insured Person from working for six consecutive months and which in our opinion is likely to prevent them from ever again working in any occupation for which they are reasonably qualified because of education, training or experience." 7 On 7 November 2005 the plaintiff sustained injury to his back whilst carrying out building work. On 30 January 2006 he submitted a claim to Westpac that his back injury entitled him to the TPD benefit under the policy. 8 Westpac then sought and obtained information about the plaintiff's medical history and the circumstances in which the application and personal statement were completed and signed. The history and related clinical notes were referred to underwriters for a blind opinion which was that had the history been known the plaintiff would not have been offered TPD cover on any terms. On 25 August 2006 Westpac obtained legal advice to the effect that the plaintiff was guilty of fraudulent non-disclosure of past injuries which attracted the application of s 29(2) of the Act. By letter of 10 October 2006 to the plaintiff's solicitors, Westpac declined cover and cancelled the policy under s 29(2) of the Act on the ground that at the time of applying for cover the plaintiff had failed to disclose his medical history in relation to past injuries. After further correspondence, by letter of 19 February 2007 to the plaintiff's solicitors, Westpac advised that the Trustee agreed with the decision to deny the claim. 9 The critical issue concerns the completion of the application and personal statement, about which the plaintiff's evidence is in conflict with the evidence of Westpac's agent, Mr Christopher Buxton. In short, the contest is in respect of the answers about the plaintiff's medical history made to certain questions in sections L and M of the personal statement. These questions each required a "Yes" or "No" answer. All were answered "No". 10 It was common ground that, whilst at work, the plaintiff had suffered injury to his neck in 1990, and to his lower back in 1993, chronic pain associated with the 1993 injury, and a depressive condition associated with both injuries. 11 The plaintiff accepted that if the answers had been given by him, they would have been knowingly false and dishonest. In this context, the issue became whether the plaintiff's evidence that he disclosed his prior medical history to Mr Buxton is to be preferred to Mr Buxton's denial that he did. 12 If Mr Buxton's evidence is preferred, it is accepted that the plaintiff's failure to answer the questions in sections L and M of the personal statement was fraudulent, thus attracting the application of s 29(1) and (2) of the Act. 13 An issue then arises under s 29(1)(c) of the Act as to whether or not Westpac would have entered into the contract had the material which was not disclosed been disclosed. Westpac's right to avoid the policy under s 29(2) requires it to show that it would not have entered into the contract even had there been disclosure. 14 The next issue, assuming the contract is not avoided, is whether as a consequence of the injury suffered on 7 November 2005, the plaintiff fulfils the requirements of the definition of total and permanent disability under cl 20.3 of the policy i.e.: whether the injury or sickness is likely to prevent him from ever again working in any occupation for which he is reasonably qualified because of education, training, or experience. Background 15 The plaintiff was born on 30 March 1953 in Turkey. He came to Australia in 1974. He left school after year 10 and undertook, but did not complete, a TAFE course as an apprentice motor mechanic. In 1980 he commenced working with BHP Port Kembla as an operator in the reversing mill. 16 In 1986 he returned to Turkey, carried out military service, and married. He worked in various bazaars with a relative. In 1988 he returned to Australia, worked as a contract labourer, and became the owner of the property at no. 20 Cowper Street, Fairy Meadow (Cowper Street). 17 In 1989 he was reemployed at BHP as a shunter in a blast furnace. 18 On 2 January 1990 the plaintiff was injured by an explosion at the blast furnace by which he was thrown into the air. He was in hospital for 10 weeks. According to the report of 7 June 1990 of Dr John Bannister, orthopaedic surgeon, he suffered severe damage to his neck and was totally unfit for all work. On 13 December 1990 Dr W L Metcalf, psychiatrist, held the opinion that the plaintiff experienced phobic anxiety when in the area in which the accident took place, and suggested he be employed well away from that area. The plaintiff resumed work in April 1991 at BHP's conference centre at Warrawong organising the conference and training rooms, with office duties as required. 19 On 23 June 1993, whilst moving a heavy table in the course of setting up a function room at the conference centre, the plaintiff injured his lower back and suffered associated pain. After seven weeks off work he returned to light duties not involving heavy lifting. He continued to suffer chronic back pain which, according to Dr Metcalf's report of 9 December 1993, "… is having a depressing effect on him and complicating his already established post-traumatic stress reaction". On 28 September 1994 Dr V Gupta, the plaintiff's general practitioner, expressed the view that the plaintiff would continue to require regular medical treatment for the relief of back and leg pain, and that his post traumatic stress syndrome was chronic and unlikely to be fully resolved. 20 On 1 March 1996 the plaintiff ceased employment with BHP. On 17 March 1996 Dr Gupta provided a medical report in support of the plaintiff's application for benefit under the BHP Superannuation Fund. He certified that the plaintiff was totally and permanently unfit for his pre-injury work or any other occupation for which he would be reasonably qualified because of physical and mental disabilities. He commented that the plaintiff would need regular medical treatment and psychological support from time to time. 21 Later in 1996 the plaintiff and his family went to live in Istanbul, Turkey. In January 1997 he arranged for the incorporation of his company, Berk Deri, through which he operated a fashion business selling women's shoes. He employed two staff, and worked long hours. About 12 to 15 months later his back improved significantly and his depression settled. Neither his back nor his depression impeded his working ability, and he did not require medical treatment whilst in Turkey. 22 In September 2000 the plaintiff returned to Australia with his family after the 1999 earthquake in Turkey. During his absence the Cowper Street property had been developed into three townhouses one of which, unit 1, became the home for him and his family. 23 On about 19 November 2007 the plaintiff and his sister obtained a business access loan for $280,000 from Westpac to assist with the purchase of the Michel's Patisserie franchise at Liverpool (the patisserie). The loan was secured by a mortgage over the three units at Cowper Street. Mr David Talty, on behalf of Westpac, arranged the transaction. 24 On 14 December 2001 the purchase of the patisserie for the price of $250,000 was completed. Conduct of the business required the plaintiff to drive each day to Liverpool from his home at Cowper Street. He participated in all activities required for the operation of the shop including the unloading and displaying of cakes, cleaning, making coffee and serving customers. 25 On about 4 February 2002 the plaintiff signed the application and related personal statement in support for his application for benefits under the Westpac Life Superannuation and Protection Plan. The policy commenced on 27 March 2002. 26 In about June 2003 the plaintiff sold the patisserie for the price of $350,000, after which he became a property developer as an owner/builder. 27 On 31 October 2003 the plaintiff purchased the property at no. 8 Staff Street, Wollongong for the price of $360,000. 28 On 19 April 2004 he purchased a property at Elliotts Road, Fairy Meadow for the price of $417,000, which he sold on about 8 September 2005 for $382,000. 29 On 7 November 2005 the plaintiff injured his back whilst lifting heavy blocks in the course of working on the building site at no. 8 Staff Street. He has not worked since then. 30 On 30 January 2006 the plaintiff submitted a claim to Westpac for the TPD benefit under the policy. The claim was finally declined on 19 February 2007. The non-disclosure and fraudulent misrepresentation issue 31 The issue concerns the completion of the answers about the plaintiff's medical history in sections L and M of the personal statement. All questions were answered "No". 32 The question posed in section L in respect of each of 18 specified conditions was as follows: "To the best of your knowledge, have you ever had, or been told you had, any of the following?" Full details of any "Yes" answer were to be provided. Of particular relevance were the following: "(12) Mental or Nervous Disorder, Anxiety, Stress or Depression. (13) Injury, Pain, Strain or Disorder of the Spine, Back or Neck." 33 The question posed in section M in respect of each of six specified investigations and treatments was as follows: "To the best of your knowledge, do any of the following questions apply?" 34 Full details of any "Yes" answer were required. Of particular relevance were the following: "2. Do you contemplate seeking any examination advice or treatment (including medical or surgical) in the near future, or have any symptoms of ill health or disability? … 4. Have you consulted any doctors or attended any hospitals within the past five years other than as already stated? 5. Have you ever claimed any benefits from an insurer or been off work for more than a total of 15 days, due to an illness or injury?" 35 It is common ground that the plaintiff's medical history required questions 12 and 13 in section L, and each of questions 1-5 in section M to be answered "Yes". The plaintiff accepted that if he answered "No" to these questions, such answers would have been deliberately false and dishonest to his knowledge. 36 The plaintiff's evidence on this issue is analysed as follows. 37 In chief, the plaintiff said he met Mr Buxton at the shop in January 2002 on two occasions when insurance options were raised, but he was too busy working to discuss details. On the next occasion Mr Buxton came to the shop with the documents. They sat at a table, and Mr Buxton explained the proposed income protection and superannuation cover, and proceeded (T p 32, l 12-24): "A. After that he started asking questions about the forms. Whatever there was questions I said "look, I don't have much" - I was serving at the same time, come back and sitting down, and I said "you have to guide me there because I have not done this before. You have to help me because I have no - I don't know, I have no time, plus I haven't got time and I don't understand this paperwork, you have to guide me through it". Q. You just told us that you were standing up and serving customers as well, is that right? A. I was coming back to the shop, yeah, coming back and forward, yes. Q. So this conversation was taking place in bits and pieces so to speak? A. Yes." 38 Mr Buxton asked, and the plaintiff answered, questions from the application. Some answers were written by the plaintiff (e.g. nominated beneficiaries in section K), and he was uncertain, or could not recall, whether he or Mr Buxton wrote others. His signature appears in section L, and on the last page. 39 He gave an account of the circumstances in which the personal statement was completed. Most of the time Mr Buxton wrote the answers to the questions. He said (T p 39, l 24-p 40, l 41): "Q. No, what did he (Mr Buxton) actually say? What did he say to you? A. He said "now we have to ask you questions of your family, or your history of health", my own history of health. Q. And what happened next? A. He started asking the questions. Q. What did he say? A. He ask me my father - did someone in the family had heart problem. I told him my father died in 1980. I said he died at the age of 45 from heart attack, from heart disease. He asked my mother, I said she is an epileptic, she is alive and other than that he started asking my, in the past of my accident. He started asking "did you have injuries in the past", and I said - but I don't know how he put the term, but in the last ten years or something did you have some injuries, accident-- Q. And what did you say? A. I said yes, I did have an accident. I had explosion in No. 5 blast furnace which I explained before -- Q. What were the words that you said about the explosion of No. 5? A. I said I was blown up in No. 5 blast furnace. I had an accident there and I was taken to hospital. I was off work for a long time, I explained to him everything that I explained before-- Q. Tell us what you said-- HIS HONOUR Q. I am afraid you have to go over it again. Imagine you are talking to Mr Buxton, what was it that you said to him? A. I said "I had an accident in 1990 where a fellow shift mate didn't turn up to work. I had to work for him and during that night we had a call, 'take the loco back 700 metres, a thousand metres back, there is a danger in the furnace'. We took the loco back 700 metres and we waited there. No-one turns up to relieve me still, and I wanted to go home and no-one turned up, and someone from the furnace later on during that night said 'come and pick up the ladles'. I said 'is it dangerous'? He said 'no, it has got to be taken, the danger is finished'. So I went to the furnace to pick up the full ladle. While we coupled up and pulling out, the blast furnace exploded. I flew in the air. I landed on my face and there was hot metal raining, and the first thing I saw there was a Brambles shed and I started running for my life. I took a dive underneath the Brambles shed and there was help coming. I saw lights everywhere and one of the ambulance men was brave enough, he came out and helped me. He helped me up, he put me in the ambulance, he put a mask on my face, oxygen or whatever it was, and I was out after that. I was taken to hospital. I wake up in the hospital that morning. I explained that to him exactly the way I did today sir. BARAN Q What was his response? A. His response said "is there anything left from that day, from that day to today is there anything still bothering you"? I said "as you can see I am working, I am fine. I am working 7 days a week". Q. Was there any further discussion-- A. Yes. Q. --about your history, medical? A. He said "is there anything else that happened between this time, that time", I said "yes, I was working in the conference centre. I was moving a table almost by myself I turned the table and I hurt my back and I was on light duties there for another three years". I said "I had a case that was finished in 1996 and I had a settlement", and I told him the figure and everything—" 40 After explanation of the accidents Mr Buxton used his mobile telephone to make two telephone calls. The plaintiff did not know to whom they were made, and was too busy to hear what was said. Mr Buxton then said he needed to take advice as to whether cover was available and, if it was, he would return another day for the plaintiff's signature and finalisation. Sections L and M may have been filled out with ticks on this occasion. Before Mr Buxton telephoned he asked all the questions about health. The plaintiff wrote the answers in section H as to family history, and the answers in section S as to employment history. 41 Some time later Mr Buxton returned with the documents. The plaintiff continued (T p 43, l 25-30): "A. … He came back to me after he spoke to the office. He came. He came when I was very busy, he put out the forms, he said "Ken, I talk to them. It is okay for you to get insurance, all we need to do now is finalise it, just sign off and this is how much will be taken out of your account and you will be insured from this day on", and I just sign and that was it." 42 The plaintiff denied that Mr Buxton came to his home at any time. 43 Under cross-examination, with reference to the personal statement, the plaintiff gave the following evidence (T p 152, l 31-p 154, l 15): "Q. You have printed your name under the heading "client name". That is your handwriting. Kenan Berk? A. Yes. Q. If you go back to 525 and compare the writing the writing at 525 against 533, when you've written Kenan Berk, it is identical, that is Kenan Berk at 533 is in identical handwriting to what appears under the names, in the names of the beneficiaries in the section "full name of nominated beneficiary" at 525? A. Looks like it is. Q. If you go to page 534 all of the writing on that page is yours; do you agree? A. Looks like it, yes. Q. Over the page 535, all of the writing on that page is yours; do you agree? A. Looks like it, yes. Q. 536, and I am directing in this question your attention to the writing on 536 in the box above the section headed Health Details, do you see that? What I wish to put to you is -- A. Cigarettes. Q. In the information concerning height and weight, smoking and alcohol, all of the handwriting in those two sections are yours, correct? A. Could be. Q. Well, not could be, it is, isn't it? A. It looks like my writing. Q. Then at 538 you have signed twice and the signatures there are yours, are they not? A. Yes. Q. 539, all of the handwriting on that page is yours, is it not? A. Looks it, yeah. Q. Including the ticks in the various boxes at 539, do you agree? A. Ticks could be, yes. Q. If you go back to 537, the ticks in the boxes on that page are your ticks, aren't they? A. 537? Q. You ticked those boxes on page 537? A. Yes, could be. Q. And you also ticked the boxes at 536, didn't you, under the heading Health Details? A. My ticks are as you can see the other ones not the same here. Here we have problems. Q. Sorry? A. Here, we had - where the problems occurred. Q. Do you say that you didn't tick those boxes at 536? A. Some of them would not be mine. Q. Which of them were not yours? A. You can see the different ones. Q. You tell me which are the ones you say you didn't tick because so far as I can see there are 18 ticks? A. Most of them. Q. Tell me which ones you say you didn't tick? A. From 5 onwards. Q. Is this right, you tell his Honour that you have an actual recollection of ticking boxes 1 to 5, is that right? A. hat I am saying is normally I-- Q. Can you answer my question, you told me that your ticks occurred in boxes 1 to 5 at page 536. Do you tell his Honour that you can actually recall ticking those boxes against items 1 to 5? A. I don't recall this anyway. I don't recall this but what I remember-- Q. Just stop there, are you saying you don't recall the circumstances in which the ticks were placed in the boxes at page 536 under the heading Health Details Part 1? A. Sir, I am a bit tired, I am mixed up. I am not feeling very well at the moment. I can answer this, it's no problem but I am starting to have—" 44 At this point the plaintiff applied for an adjournment until next day on the ground that he was unwell. It was granted, by consent. 45 After resumption of the hearing next day, the plaintiff withdrew his evidence that he ticked boxes one to five of section L, and said he was lost, confused, and unable to concentrate when giving that evidence. On similar grounds, he withdrew his evidence that he had ticked the boxes in section M. He then said that before the questions in sections L and M were raised, he disclosed the accidents and details of his medical condition at which point Mr Buxton stopped and said he needed to speak to his office. These sections were not filled in. The plaintiff agreed that he wrote the handwritten letters and numbers in all other parts of the personal statement, but said that the ticks were not written by him. Initially, he said the ticks were already filled in when the document was presented to him (T p 174-175). He then said recollection was difficult, and suggested that some ticks were made by Mr Buxton, and some by him, according to the answer he gave (T p 177). 46 He said that at the conclusion of the meeting, when Mr Buxton took the documents away, only sections L and M of the personal statement remained for completion, and there had been no discussion of the questions in them. 47 Some time later, Mr Buxton returned with the documents, which the plaintiff signed, but did not read. 48 The plaintiff was cross-examined on his statement of 30 October 2006. It was prepared by his solicitor to provide Westpac with details of the circumstances in which information was disclosed prior to the issue of the policy. In it (par 3), the plaintiff said the occasion on which disclosure was made was in conversation on one of Mr Buxton's visits to the shop, after which Mr Buxton made a telephone call, but he did not pay attention to what was said. The conversation continued in which Mr Buxton said: "Most likely your old injuries are not important. We can probably insure you. I will need to make some enquiries." 49 The statement records (par 5) that next day Mr Buxton came to the shop with some forms, including the application. It included: "6. I may have signed the paperwork on that occasion, although I do not remember doing so. I can say, however, that all the paperwork had already been filled in by Chris Buxton. If I did sign anything, it was a document that Chris Buxton had already prepared. … 10. Whenever I saw Mr Buxton, it was always at the shop. Whilst he spoke to me, I was making cakes, serving customers, and generally running my business. Mr Buxton told me that he did not have time to come to my home, and it was convenient to him to come to my shop." 50 The plaintiff was also taken to his affidavit sworn 17 September 2008. The account of the circumstances of the disclosure conversation and the making of a telephone call (pars 4, 5) was in similar terms to that in the statement. The account of Mr Buxton's return next day with the forms (par 8) was in similar terms to that in the statement. The affidavit included: "9. I may have signed the paperwork on that occasion, although I do not remember doing so. I can say, however, that all the paperwork had already been filled in by Chris Buxton. If I did sign anything, it was a document that Chris Buxton had already prepared. At the time, I was at work. The shop was very busy. I was serving customers. I was talking to him while I was working. He said: 'Ken, all the paperwork has been prepared. All that is left is a signature and away you go, the insurance will start. The money will come out of your account every month.' He showed me the application form. He opened it to the position where I had to sign. He put it on the coffee bar in front of me. He gave me his pen. I saw that the paperwork had been filled in. I believed that Chris Buxton had filled it in. He did not read the document to me. I was too busy to read the document. He did not ask me to read the form. I trusted Chris Buxton. I felt he was my friend. He put his finger near the place where I had to sign. I signed the form. … 13. Whenever I saw Mr Buxton, it was always at the shop. Whilst he spoke to me, I was making cakes, serving customers, and generally running my business. Mr Buxton told me that he did not have time to come to my home, and it was convenient to him to come to my shop." 51 The plaintiff agreed that by par 9 he intended to convey he had filled in no part of the application which he signed (T p 209). He accepted that at the times he made the statement and swore the affidavit he knew he had filled in parts of the application and personal statement in his own handwriting (T p 210). He accepted that the assertions that all the paperwork had already been filled in by Mr Buxton were wrong (T p 207, 215). 52 The following is a summary of Mr Buxton's evidence. 53 During 2000 to 2004 he was employed by Westpac as a business protection specialist to arrange insurance for medium to small businesses. His first meeting with the plaintiff was on 9 January 2002 at the patisserie shop at Liverpool when different types of insurance were discussed. During the meeting, in the plaintiff's presence, he telephoned the underwriter's hotline to ask whether the plaintiff was eligible for income protection. The advice that he was not so eligible without a 12 month trading history was explained to the plaintiff. Other types of insurance were then discussed and the meeting ended with agreement that Mr Buxton prepare a presentation for the plaintiff's consideration. 54 The next meeting was on 15 January 2002 at the shop. There was a brief discussion concerning available options, and a presentation was given to the plaintiff which contained examples of premium calculations. 55 The next meeting was on 29 January 2002 at the shop. Although the plaintiff was busy, there was a brief discussion during which the nature of cover required by him was agreed. 56 The next meeting was on 4 February 2002 at the shop for the purpose of attending to the documentation. Mr Buxton brought the form of application and the personal statement. Prior to the meeting some parts of the first page of the application had been completed by Mr Buxton and his assistant, Alison. These were the details of the policy owner in section A, and of the person to be insured in section C. The date was also entered where required. No other part of the document had been filled in prior to the meeting. The only matters completed in the personal statement prior to the meeting were the cover page details of the client's name, application number, and adviser's name. 57 The plaintiff and Mr Buxton sat down to deal with the paperwork. As the shop became busy the plaintiff excused himself from time to time to work. It was then arranged that they meet next day after hours at the plaintiff's Cowper Street home. 58 At about 6.30pm on 5 February 2002 Mr Buxton met the plaintiff at Cowper Street. He brought with him the application and personal statement. The plaintiff's wife and children were present. Mr Buxton sat beside the plaintiff in the lounge room, whilst the others went into an adjacent room. 59 No additional information had been included in the application since the meeting the day before. The plaintiff then provided details of the beneficiaries, and signed as required in section K. Mr Buxton ticked the third box in section L and the plaintiff signed as required. Section M, under the heading "Westpac Financial Adviser Section", was not completed as the information was not available. Section R was signed by the plaintiff. 60 Referring to the personal statement, Mr Buxton said that apart from his signature and the date no entry was in his handwriting. As they proceeded through the document he explained the questions to be answered. The plaintiff completed sections C, D, E, F, G, H, I and J. 61 Mr Buxton asked the plaintiff to complete section L and to raise any questions with him. He said the plaintiff ticked the "No" boxes in each case. He then asked the plaintiff to read through the questions in section M and answer "Yes" or "No", which he did. The plaintiff signed where required in sections Q and R, and completed the employment details in section S. 62 Mr Buxton said he was not told by the plaintiff that he had been injured in an explosion at BHP in 1990, or that he had suffered a back injury in 1993, or that he had suffered from phobias or a nervous condition, or had any form of medical complaint or prior history. 63 In cross-examination Mr Buxton said his purpose in telephoning the underwriter was to double check whether income protection was available for a "start up business" being a new franchise of a business which had a trading history. With reference to his log books he adhered to his evidence in chief that he visited the plaintiff at Liverpool on 4 February 2002 and at his house at "Fairy Meadow just north of Wollongong" (T p 277) on 5 February 2002. 64 He denied the plaintiff had told him of his injuries at BHP. He said the plaintiff told him that while he was working at BHP there was an explosion in the blast furnace, and he decided to leave not long afterwards as he did not think it was safe. The plaintiff told him that he received a redundancy payout and decided to start his own business. Mr Buxton rejected as false the proposition that, on 4 February 2002 whilst the plaintiff was filling out the personal statement at the shop, the plaintiff told him that he had injured his back in the blast furnace explosion, and also at the BHP conference centre. 65 Mr Buxton was cross-examined about a Westpac document headed "Privacy Consent – Underwriting", signed by the plaintiff on 21 February 2002. Its effect, inter alia, was to authorise Westpac to obtain information for assessing the application, including information about health or disability. He said it was normal practice to have the consent form signed at the same time as the application and personal statement were completed, following which the documents would be sent together to the underwriter at head office in the city. Mr Buxton said that in this case the consent form was out of stock and unavailable when he met the plaintiff on 4 and 5 February 2002. The consent form was sent to the plaintiff at the patisserie on 20 February 2002 and, as requested, it was returned next day to Westpac Business Direct, the administration centre at Concord. He said the documents were then sent together to the underwriter, and observed that without the consent form the application could not be assessed. Consideration 66 The fundamental question is whether the plaintiff's evidence that he disclosed his medical history should be preferred to Mr Buxton's evidence that he did not. The resolution of the conflict turns on my findings about them as witnesses. 67 For the plaintiff it was submitted that his evidence that he told Mr Buxton of the explosion and his injuries on 4 February 2002 whilst he was filling out the personal statement should be accepted as truthful. Without being exhaustive, I have attempted to summarise what I understood to be the principal submissions. 68 It was put that the plaintiff acted honestly in giving the information in section G as to Dr Gupta's details and attending him for 18 years, and in section J as to details of height and weight, and in section K as to details of smoking and alcohol, such conduct being inconsistent with an intention to mislead the insurer, and amply supported his claim that he disclosed the relevant history. Similarly, it was put that by signing and returning the privacy consent form, which authorised investigation of his medical condition, he demonstrated the unlikelihood of non-disclosure to deceive Westpac. 69 Further, it was put that it was more probable than not that during the conversation in which the plaintiff referred to the explosion at BHP he explained the related injuries and phobia, and it was unlikely that what he said was limited to the version given by Mr Buxton. 70 It was submitted that Mr Buxton's evidence that on 9 January 2002 he made a phone call to see whether income protection was available to the plaintiff should be rejected as nonsense. It was put that, having regard to Westpac's underwriting guidelines, he would have known that such cover was not available, and as enquiry was unnecessary it was improbable that the call was made. 71 The plaintiff relied heavily on the delay between the time the underwriter received the privacy consent form on about 27 February 2002, and the issuing of the policy on 27 March 2002. It was put that the delay established the inference that the underwriter, after discussion with Mr Buxton, decided not to investigate the plaintiff's medical history after receiving the privacy consent form, a process which accorded with the date of the policy. The submission was as follows (T p 361 l 1 – 36): "The delay, be it from 21st February to 27th, is one thing, but the delay from 27 February to 28 March, in our submission, is an unexplained delay, inconsistent with the guidelines, 24 hour turn around. Mr Van Heerden, a very experienced underwriter, said, at the worst, seven days for a cleanskin application. HIS HONOUR: What are you putting would be the probable conclusion about what was going on during these gaps? BARAN: The probable conclusion is that Mr Buxton must have had a discussion, either with Mr Barry, or Mr Pennington, or someone else at Underwriting, to say, "Look, does he have to fill in on this form that he had a pre-existing condition when he injured himself back in 1990 and then in 1993. He had been overseas. He is now back working and has been working for quite some time. He owns his own business. He works seven days a week. He works like a Trojan. He is able to work long hours and doesn't appear to have any problems whatsoever. In terms of his health, he doesn't pose a risk. What do you think about that?" He has gone back and they may have said, "Get consent forms, or check it out with the doctors". Consent forms are signed and nothing done. Why is nothing done? The defendant doesn't tell your Honour, just doesn't tell your Honour, but says Mr Berk is a fraudster. In our submission, the gap in the defendant's case is unexplained. There is no satisfactory reason for not having called Mr Barry; no satisfactory reason for not having called Mr Pennington. There are two issues that arise. Firstly, the evidence is just simply left, as it were, in the air. Secondly, in our submission, your Honour should draw an inference that, had those gentlemen been called, their evidence wouldn't have necessarily assisted the defendant's case. Of course, your Honour has the critical absence of Mr Buxton's records and the file, any e-mails that may have been sent from Underwriting, a print-out of the tracking system, nothing." 72 It was also put that the passage in Mr Buxton's statement of 28 December 2006 was also consistent with the plaintiff's version. It is: "2 … I also visited Mr Kenan at his home address in Wollongong to finalize the sale and for him to have time to complete the Personal Statement as he was always busy at the shop …" The submission was that the use of the word "finalize" supported the inference that the personal statement had been filled in to section L, and the remainder was to be completed following discussion with the underwriter. 73 Ultimately, the findings sought were that, following the plaintiff's disclosure, Mr Buxton completed section L (and, presumably, section M), after discussion with the underwriter, and having decided that the plaintiff did not pose a risk. 74 For Westpac it was submitted that Mr Buxton was a truthful witness whose evidence should be accepted. It had not been suggested that he was motivated to act dishonestly in accepting false answers to sections L and M, and it was inherently improbable that he would conceal the plaintiff's history from his employer. As for the hypothesis that Mr Buxton passed on the plaintiff's information to the underwriter, and proceeded on the basis that the risk was accepted, it was put that it lacked any evidentiary support, and Mr Buxton was not cross-examined on it. 75 Furthermore, it was argued that, until final submissions, the plaintiff had put no case that Mr Buxton obtained approval from the underwriter for the risk (and, presumably, to complete sections L and M) having regard to what the plaintiff told him and, accordingly, such case was not open. It was pointed out that if such had been the case, Mr Buxton's conduct would not have been dishonest, yet there was no rational explanation for him to falsely deny the conversation on 4 February 2002 in these proceedings. 76 Westpac submitted that the plaintiff was not a witness of credit, and his account should not be accepted, principally for the following reasons: (1) The plaintiff's version of the circumstances in which the documents were completed was internally contradictory, and inherently improbable. For example, he accepted he ticked the boxes in section M and boxes one to five in section L (T p 153, 154), but retracted this the next day (T p 171). His explanation that he was confused when giving the earlier evidence should be rejected because the filling in of the boxes had always been a critical factual issue, and not a topic about which he could have been confused as claimed. Another example was his evidence that Mr Buxton discussed with him each of the 18 questions in section L (T p 179), but later denied this happened (T p 196). (2) The evidence as to the ticks in the personal statement other than those in sections L and M lacked credibility. The plaintiff had asserted that although he wrote all of the letters and numbers, none of the ticks were his (T p 172-177). At one point he said the ticks were already filled in when the document was presented to him (T p 174, 175), but then suggested they were made by Mr Buxton at the same time as he wrote on the form because he was running in and out of the shop (T p 176, 177). It was put that the suggestion that he attended to the writing, but left the ticks to Mr Buxton, was implausible. (3) The plaintiff's oral testimony as to the circumstances of completion of the documents was substantially inconsistent with the account given his statement of 30 October 2006 and in his affidavit of 17 September 2008. Particular reference was made to pars 3, 4, 5 and 6 of the statement and to pars 5 and 9 of the affidavit, (the substance of which is identified above) and to the acknowledgement that the assertion in par 9 of the affidavit that all of the paperwork had been filled in was wrong (T p 210, 215). It was also pointed out that the documents omitted reference to the process of Mr Buxton reading from the forms and the plaintiff filling in various parts of them as described by him in cross-examination. (4) A review of the whole of the plaintiff's evidence demonstrated that his version of events evolved: (a) from a version where he never saw any forms, until they were presented, completed, to him for signature; (b) to a version where he was aware that Mr Buxton was asking him questions from a form, but he played no part in their completion and signed them on presentation; (c) to a version where the plaintiff and Mr Buxton sat down together to complete the documents (except sections L and M) and Mr Buxton did most of the writing; (d) to a version where the plaintiff and Mr Buxton sat down together to prepare the forms (except section L, or parts of it), and where the plaintiff did most of the writing. (5) The description in section I, personal statement, of the outcome of the plaintiff's medical consultation with Dr Gupta on 27 January 2002 as "everything fine" was misleading in that at the time he had ongoing back pain and depression for which Dr Gupta was treating him. (6) The plaintiff's explanation for the negative answers he gave concerning his medical history in the application for insurance with American Life Turkey, dated 21 April 1998, reflected badly on his credit. It was put that his evidence that although he disclosed to the representative details of his prior history in Australia, she told him she was concerned only with his health in Turkey (T p 113) should be rejected as implausible. Conclusion 77 In my opinion, the plaintiff's evidence concerning the completion of the application and personal statement must be rejected as untrue. During the hearing I formed the view that his evidence on this crucial issue was inherently implausible, and contained such significant inconsistencies as to establish to my satisfaction that it was the product of invention. 78 The inconsistencies and contradictions were identified in Westpac's submissions summarised above (par 76). There are obvious substantial differences between each account given by the plaintiff in chief (pars 37-41), in cross-examination (pars 43, 45-47), in the statement of 30 October 2006 (pars 48, 49), and in the affidavit of 17 September 2008 (par 50). The overall effect was to undermine the credibility of his case. In my assessment, the plaintiff's resort to these inconsistent accounts demonstrated each to be false. 79 According to the statement of 30 October 2006, disclosure was made during a conversation at the shop, following which Mr Buxton made a telephone call. The conversation continued, after which Mr Buxton left. Mr Buxton returned next day with the documents (the "paperwork"). All the "paperwork", which the plaintiff may have then signed, had been filled in by Mr Buxton. 80 In this version no documents were under discussion when disclosure and the single telephone call happened. The documents were not brought to the plaintiff until the next day. He was not questioned, and he signed the "paperwork", all completed. 81 The statement was made in response to Westpac's letter of 10 October 2006 to the plaintiff's solicitors advising of cancellation of the policy under s 29(2) of the Act for non-disclosure of the medical history of past back injuries, and inviting further information to support a review of that decision. The statement is said to be on oath. It was enclosed with the solicitors' letter to Westpac of 3 November 2006 which said: "My client disagrees that he failed to disclose previous illnesses and injuries. Indeed, he says that all relevant information was disclosed to Westpac's sales representative, who prepared the Personal Statement and directed Mr Berk to sign it … (the statement) details the circumstances in which information was disclosed prior to the issue of the policy." 82 As earlier mentioned the version in the affidavit was to similar effect. Both the statement and affidavit are couched in unequivocal terms. Although at the time each was made he had solemnly represented that its contents were true, at trial the plaintiff accepted that the account of completion was wrong. 83 In chief, the plaintiff effectively abandoned the earlier versions and asserted the truth of a different one (pars 37-41). Its weakness was revealed under cross-examination (pars 43-47) during which he withdrew answers earlier given in which he said he had ticked boxes one to five in section L and the boxes in section M. 84 As the plaintiff stumbled from one version to another I formed the view that he was a witness without credibility, whose evidence should not be relied upon where contested unless corroborated. In my opinion the differences between the versions were significant. They demonstrate the plaintiff's lack of confidence and conviction in his case. I am satisfied that the simple explanation for his difficulties at the hearing was because he became entangled in a web of deception of his own making. 85 Furthermore, I reject as highly improbable the plaintiff's claim to withdraw evidence that he ticked boxes in sections L and M on the ground that it was given whilst he was confused and unable to concentrate. My observation at the time, reinforced by analysis of the transcript (par 43), was that the plaintiff had no difficulty whatever in answering the questions put with reference to the personal statement, and called for an adjournment only when it occurred to him that his answers would be harmful to his case. 86 A finding, as the plaintiff ultimately sought, that sections L and M were completed after discussion between Mr Buxton and the underwriter and/or by the underwriter, is without any evidentiary support and, hence, not open. The relevant submission was merely an invitation to speculate which must be rejected (Luxton v Vines [1952] HCA 19; (1952) 85 CLR 352, p 358, 360; Jones v Dunkel [1959] HCA 8; (1959) 101 CLR 298, p 304, 305.) 87 The plaintiff's denial that Mr Buxton came to Cowper Street made in the statement, the affidavit, and in oral testimony is also rejected. His wife who Mr Buxton said he met at the house was not called to give evidence, and no reason was advanced for her absence. In this case, I draw the inference referred to in Jones v Dunkel. 88 For the above reasons I reject as untrue the plaintiff's evidence of the circumstances in which sections L and M of the personal statement were completed. I generally accept Westpac's submissions on this issue. 89 I accept Mr Buxton's evidence generally and, in particular, of the circumstances in which the application and personal statement were completed. In my assessment he was a truthful witness whose evidence on all issues was given as best as recollection allowed. He was firm and unequivocal in his account of his meetings with the plaintiff and what occurred at them. Where his evidence conflicts with the plaintiff's, I prefer it. He was unshaken in cross-examination, was internally consistent, and demonstrated that the documents were completed in compliance with his normal practice. Rejection of Mr Buxton's evidence required a rational basis for finding that he acted as claimed by the plaintiff, but it was not established. 90 For example, I find it highly probable that, by reason of the plaintiff's workload at the shop, it was convenient to have the application and personal statement completed after hours at the plaintiff's home. Mr Buxton's descriptions of the house and meeting the plaintiff's wife and children were not contradicted. His log book entries for 4 February and 5 February 2002 support this conclusion. 91 Mr Buxton's evidence supports the findings, which I make, that the application and personal statement were completed on 5 February 2002 at the plaintiff's home at Cowper Street and, in particular, that the plaintiff answered "No" to all of the questions in sections L and M of the personal statement. His evidence also established, and I find, that prior to completion of the personal statement the plaintiff failed to disclose, and/or by his answers to the questions in sections L and M made misrepresentations about, his prior medical history. 92 The plaintiff accepted that if the answers had been given by him, as I have found, he knew them to be false and dishonest at the time. He also accepted that his failure to answer the questions in sections L and M of the personal statement was fraudulent, and attracted the application of s 29(1) and (2) of the Act. The issue under s 29(1)(c) of the Act 93 Relevantly, s 29(1) of the Act provides: "29 Life insurance (1) This section applies where the person who became the insured under a contract of life insurance upon the contract being entered into: (a) failed to comply with the duty of disclosure; or (b) made a misrepresentation to the insurer before the contract was entered into; but does not apply where: (c) the insurer would have entered into the contract even if the insured had not failed to comply with the duty of disclosure or had not made the misrepresentation before the contract was entered into; or …" 94 Thus Westpac's right to avoid the policy under s 29(2) depended upon it showing it would not have entered the insurance contract even had there been disclosure. In Tyndall Life Insurance Co Ltd v Chisholm [2000] 11 ANZ Ins 90-104, a case in which a life insured failed to disclose he had undertaken a medical test Debelle J said (par 78): " … So, in this case, in order that the remedies of s 29 may be available to it, Tyndall must show that the fraudulent non-disclosure or fraudulent misrepresentations were relevant and induced it to accept the risk. I respectfully agree with Professor Sutton that it is implicit in the wording of s 29(1)(c) that the insurer is denied a remedy only where he would have entered into precisely the same contract as that which was made …" 95 As the plaintiff did not concede that Westpac would not have issued the policy had there been disclosure, it was necessary for Westpac to prove the point. 96 The evidence on this issue was given by Mr Nathan Sweeney, Mr Michael Reimer and Mr J P van Heerden. In effect it was unchallenged. I accept it. 97 The evidence of Mr Nathan Sweeney, an experienced underwriter, established that the underwriting assessment of the policy was made by a Mr Brett Pennington, then the senior underwriter within Westpac, in February/March 2002. He identified as Mr Pennington's the handwritten notes in the confidential section of the underwriting assessment sheet, and explained the notations in it. He said that Mr Pennington ceased employment with Westpac in early 2004, and recent enquiries suggested he was presently working in Tokyo. 98 Mr Reimer is a senior underwriter of about 10 years experience. He carried out a blind underwrite referral assessment in respect of the policy at Westpac's request with regard to Westpac's underwriting guidelines applicable at 26 March 2002. He considered the application, the personal statement, and the clinical notes and medical reports which predated acceptance of the risk on 26 March 2002. He identified the underwriting coversheet and Mr Pennington's assessment sheet as documents which recorded the underwriting process. 99 With regard to the plaintiff's medical history and to the guidelines, Mr Reimer's opinion was that the risk was unacceptable, and the policy would not have been written. He said that in his experience underwriters had no discretion to depart from guidelines. 100 His affidavit of 3 December 2008 included: "17. On the basis of the information contained in the personal statement only, I would have recommended that TPD cover be provided to Mr Berk. In my opinion, Mr Berk's application is what is referred to in the insurance industry as "cleanskin", by which I mean that the client disclosed a clean medical history and I would not have made any further inquiries of Mr Berk and on the basis of the information contained in the personal statement alone I would have recommended cover at standard rates. 18. Having reviewed the application form and personal statement, I then read the clinical notes and medical reports attached to the blind underwrite referral … in my opinion the medical reports and clinical notes disclosed an overwhelming medical history and it was clear to me from reading the personal statement that there was no such medical history disclosed on the personal statement." 101 Mr Van Heerden is an underwriting manager of about 18 years experience. He considered the plaintiff's application, personal statement, Westpac's underwriting guidelines applicable in 2002, and medical reports and clinical notes. He observed that, as at 2002, the plaintiff had recurrent spinal problems; mental or nervous disorder, anxiety, stress or depression over a period of at least 10 years and within at least 8 months of his application for insurance; and tinnitus. 102 With regard to this information his opinion was that he would have declined the cover provided by the policy because it presented the plaintiff as an unacceptable risk. In particular, he pointed out that had the plaintiff's depression been disclosed the guidelines required the insurance be declined. 103 In his affidavit of 8 December 2008 (pars 19, 20) Mr van Heerden said that had he assessed the plaintiff's application on the basis of the information contained in the application and personal statement, he would have treated it as a "cleanskin". He would not have sought additional information, and would have determined the risk as acceptable, and that total permanent disability cover ought to be provided. 104 The evidence of Mr Sweeney and Mr Reimer, and the contents of Mr Pennington's underwriting notes, support the finding, which I make, that Mr Pennington relied upon the information in the personal statement in deciding to accept the risk. Mr Pennington was a senior underwriter with Westpac. There is no reason to doubt that he applied the guidelines in accordance with the practice followed by Mr Reimer and Mr van Heerden. Those persons show, if it is not self-evident, that the answers in sections L and M of the personal statement were misrepresentations or non-disclosures likely to induce an underwriter to write the contract, which Mr Pennington did. In the circumstances, the inference is inevitable that he was induced by these false answers to do so (see e.g. Gould v Vaggelas [1985] HCA 75; (1985) 157 CLR 215, p 236, 250). In my opinion the probability of inducement was established without the evidence of Mr Pennington himself. 105 The evidence of Mr Reimer and Mr van Heerden also supports the finding, which I make, that Westpac would not have entered into the same contract of insurance even if there had been disclosure or the misrepresentations had not been made. 106 Accordingly, I hold that Westpac was entitled to avoid the policy under s 29(2) of the Act. The relief claimed by the plaintiff in the amended statement of claim must be refused. The claim under the policy 107 In the event that the conclusion that Westpac is entitled to avoid the policy is wrong, it is appropriate to determine whether the plaintiff is totally and permanently disabled within the meaning of the policy. 108 Under the policy, the applicable disability benefit was an "Any Occupation" benefit. The relevant definition is in cl 20.3 which states: "20.3 If an 'Any Occupation' benefit applies, 'total and permanent disability' means: An injury, disease or sickness which has prevented the Insured Person from working for six consecutive months and which in our opinion is likely to prevent them from ever again working in any occupation for which they are reasonably qualified because of eduction, training or experience." 109 It was accepted that the plaintiff has suffered an injury which has prevented him from working for six consecutive months. As Westpac had not formed an opinion within cl 20.3, it was for the court to determine whether the injury is likely to prevent the plaintiff from ever again working in any occupation for which he was reasonably qualified because of education, training, or experience. 110 The plaintiff's evidence was that because of the injury suffered at the building site on 7 November 2005 (the accident) he has not worked since. He said that he continues to suffer pain, and is unable to sleep, or run, or lift heavy weights. During the day he needs to lie down. He is unable to work as he did at the patisserie. It was not disputed that he suffered the injury complained of; his evidence on this issue, which I accept, was not undermined in cross-examination. 111 Dr Gupta has been the plaintiff's general practitioner continuously since about 1984. He treated him after the accident for severe lower back ache and pain to the left groin and left leg. He obtained a CT scan on 1 February 2006 which reported: " Degenerative bulging of the L4/5 disc with prominent degenerative changes in the facet joints and mild forward spondylolisthesis of L4 with respect to L5. These factors are causing narrowing of the canal and moderate compression of the sac and also some narrowing of the intervertebral foramina but the nerve roots do not appear to be displaced or abnormally swollen. It is difficult to exclude some nerve root irritation although significant compression would be unlikely. Mild spondylotic changes throughout and also mild degenerative change in the facet joints of L3/4 as well." 112 Dr Gupta referred the plaintiff to an orthopaedic surgeon, Dr Medhat Guirgis. Since then treatment has been conservative. He said the plaintiff's constant lower back pain compromises his ability for any work involving lifting, pulling, pushing, carrying, prolonged sitting, standing, and walking. He suffers from anxiety and a lack of motivation for which he takes anti-depressants. 113 Dr Gupta's opinion was that the plaintiff is presently totally unfit for any gainful employment, with poor prognosis. In his report of 10 July 2006 he said the plaintiff was unlikely to improve by means of medical treatment and rehabilitation sufficiently for any gainful employment. In cross-examination he accepted that if the back pain is capable of being managed the depression symptoms would be reduced. 114 Dr Guirgis was unavailable for cross-examination. His reports were admitted without objection. He reported on the plaintiff's condition on 5 February 2006, and advised conservative treatment. On 7 April 2006 he reported that the accident caused: "… further post-traumatic mechanical derangement of the lumbar area of the spine. This was caused by further musculo-ligamentous sprain/strain with further L4/L5 invertebral disc involvement causing gross discal instability. This resulted in Grade II degenerative spondylolisthesis of the body of L4 on that of L5." 115 His opinion was that the plaintiff remained unfit for activities that would require applying stresses to the back. 116 In his report of 25 May 2006, Dr Guirgis stated: "On top of the underlying chronic physical problems the whole picture became complicated by the development of organic changes of chronic pain syndrome at the local level, at the involved spinal cord level and at the cerebral level. He presented with symptoms and signs of chronic pain/anxiety/depression. He was referred to Dr Pacoula (Psychiatrist) in that regard. The pros and cons, expectations, risks and complications of decompression with or without stabilisation were again discussed with emphasis on instrumented spinal fusion from L4 to S1. I stressed the point that no guarantees could be provided about the ultimate outcome of any line of management whether invasive or otherwise. The prognosis in his case should be very guarded because of the onset of symptoms and signs of chronic pain/anxiety/depression. In his current state he is totally unfit for work and the prognosis in his case should be very guarded." 117 Dr Ishrat Ali, psychiatrist, reported to Dr Gupta on 29 June 2006 that the plaintiff was suffering from an adjustment disorder with depression as a result of the injury. In his report to the plaintiff's solicitors of 8 January 2007 the prognosis was that symptoms would continue indefinitely. His opinion was that the plaintiff was totally and permanently disabled, and would never be able to return to his usual position. He said: "5. The depressive symptoms which have resulted from chronic pain and loss of job have worsened the situation and his insomnia and poor concentration interferes in his ability to perform work and as his physical disability is permanent his psychiatric problem is also going to continue indefinitely." 118 Having seen the plaintiff in about July 2009, Dr Ali's view was that the prognosis was unlikely to change in the foreseeable future. In cross-examination, he expected the depression would cease if the chronic pain associated with back injury were to go, as they were inextricably linked. He thought the depressive symptom would continue for so long as back pain continued at chronic level and the plaintiff was unable to cope with it. 119 Dr M H Ellis, a general surgeon, examined the plaintiff on 7 August 2007. He found that the plaintiff suffered significant spinal instability with secondary effects on adjacent lumbar spinal nerves, and required constant medication for pain relief and for depression, continuing medical supervision, and conservative treatment for pain relief. In his opinion the plaintiff was permanently unfit for physically demanding work in which he had been previously employed. 120 In his report of 23 November 2007 Dr Ellis referred to the definition in cl 20.3 and stated that the plaintiff's injury in the accident "… had resulted in total permanent disability satisfying this definition". 121 In evidence Dr Ellis said that he assumed the relevant occupations were those in which the plaintiff had worked, namely as an auto mechanic, a spray painter, in a butchery, factory work as a labourer with BHP, with the patisserie, and in the building trade. He said it was difficult to imagine a job in which he could be employed on a regular basis. 122 Dr Bruce Westmore, forensic psychiatrist, examined the plaintiff on 16 December 2008. In his report of 23 January 2009 he noted that his psychological and psychiatric problems arose as a result of pain, and if greater pain relief could be achieved, significant improvement in the plaintiff's mental state could be expected. 123 Dr Westmore was unable to express a view as to whether, at this time, the plaintiff's mental problems would prevent him from ever working in any occupation for which he was relevantly qualified. This was because he believed there were further assessment and treatment options to be trialled before it could be indicated that his psychiatric condition would not improve. 124 In evidence, Dr Westmore thought the plaintiff's depression might improve if his back pain improved. He accepted that continued suffering of chronic pain will continue to impact on his mental state. He said that even though he has chronic pain his mental state "… is still not so severe that I can say that he cannot work purely from a psychiatric perspective" (T p 318). He thought "… there was a possibility he might be after an appropriate assessment be [sic] directed towards some type of employment that suited his combination of problems, physical and psychological" (T p 318). 125 Dr J G Bodel, orthopaedic surgeon, reported on his examination of the plaintiff on 12 December 2008. He found the plaintiff had mechanical backache and irritative sciatica in the left leg with irritation of the L5 nerve root, and disc rupture at L4/5 level, and that his clinical situation was fairly static. His opinion was that the plaintiff's current orthopaedic condition: "… clearly impacts on his ability to work. He has significant clinical evidence of nerve root irritability and radiculopathy in the left leg and warrants further treatment which has a good chance of improving clinical function and therefore improving his employability." and concluded: "…. this gentleman is currently totally incapacitated for work but not necessarily permanently so. Various treatment options have been outlined which have not yet been investigated and there is a strong probability that successful treatment could allow him to return to at least modified duties in the longer term." He suggested that if the condition did not improve, the possibility of treatment by periradicular block injection or decompressive surgery should be considered. 126 In his report of 5 August 2009 Dr Bodel said: "9 Based on this gentleman's clinical presentation when I assessed him on 12 December 2008 I believe there is a good chance of a reasonable response to a peri-radicular block injection. It is likely, however, that this will be incomplete and not necessary and long lasting. If he does have a good result then there is an increased chance that the decompressive surgery will be helpful. 10 The decompressive surgery also is reasonable and necessary if he fails to respond to more conservative approaches to treatment. He does have clinical signs and symptoms suggestive that he will have a good response to that treatment if it is ever undertaken. Again, I would strongly record that whether this gentleman has a peri-radicular block injection or decompressive surgery is a clinical decision only and the decision to proceed to either of these treatment protocols must be made by the treating surgeon in consultation with patient." 127 In cross-examination Dr Bodel agreed that the approach was one of trial and error, and that present conservative treatment was probably the most appropriate. He said that, like the vast majority with conservative treatment, the plaintiff had the potential to recover between "… maybe six to nine months, maybe a year or two" (T p 247). He accepted that the plaintiff is presently totally and permanently incapacitated, and the success of any treatment option was speculative. He explained that, in his experience, 85 per cent to 90 per cent of people with similar pathology "… are going to be better at a point in the future, which is hard to determine, but it will be some years after the event" (T p 248). Consideration 128 For the plaintiff it was submitted that entitlement to the "Any Occupation" benefit as defined had been established in that the injury from the accident was likely to prevent him from ever again working in any occupation for which he was reasonably qualified because of education, training or experience. Essentially, it was put, the chronic back pain with which depression was inextricably linked, would continue indefinitely, and it was unlikely that he would ever become fit to perform heavy or labouring work of the kind for which he was reasonably qualified. 129 Westpac submitted that the plaintiff had failed to prove that it was unlikely he would ever again work in any occupation because of the injury. Although it was accepted that, at present, he was unable to do the work for which he was qualified, it had not been shown that his condition would not improve so that, over time, he would become able to do so. Reliance was placed on Dr Bodel's opinion that the vast majority of people with a similar back problem under conservative treatment do improve over time, and that the plaintiff would not remain totally incapacitated in the future. It was put that Dr Westmore showed that the plaintiff's depression might improve if his back pain improved, a view supported by Dr Ali. It was argued that their evidence, taken overall, showed the plaintiff was likely to improve so as to be able to work in any occupation for which he was relevantly suited; in other words, the evidence was sufficient to negative a finding that it is likely that the injury will prevent him from ever working again. 130 Westpac also submitted that, in assessing the plaintiff's future prospects, it was relevant to take into account his ability to overcome pain and depression to work satisfactorily for his business in Turkey, in the patisserie, and as an owner/builder. It was put that this history indicated the likelihood that he would return to work in the future. 131 The definition relates to the disability to obtain future employment in any occupation. It requires consideration of whether or not, on the evidence, it is probable that the insured would actually again work in any occupation (i.e. remunerative work) for which he is qualified by education, training or experience, and whether it is likely his injury 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 & Anor [2003] NSWSC 945, par 54; Ivkovic v Australian Casualty & Life Ltd (1994) 10 SR (WA) 325, p 351; Nile v Club Plus Superannuation Pty Ltd & Anor [2005] NSWSC 55, pars 64, 65, 68). 132 As Westpac accepted that by reason of injury suffered on 7 November 2005 the plaintiff, at the present time, is prevented from working in any occupation for which he is relevantly qualified, the crucial question is whether it is likely he will be able to undertake such work at some future time. 133 Dr Gupta's opinion was that the plaintiff is unlikely to improve sufficiently for any gainful employment although his depression symptoms would be reduced if the back pain is capable of management. On 25 May 2006 Dr Guirgis's opinion about the back injury was that no guarantees could be provided about the outcome of any line of management whether invasive or otherwise, and the prognosis should be very guarded. Dr Ali's opinion was that the depressive symptoms would continue for so long as chronic back pain continued and the plaintiff was unable to cope with it. The opinion of Dr Ellis was that the plaintiff was permanently unfit for physically demanding work in which he had been previously employed. 134 Dr Westmore's evidence was that pending the trialling of (unspecified) further assessment and treatment options he was unable to say that the plaintiff's psychiatric condition would not improve. He thought there was a possibility after appropriate assessment that he might be directed towards some type of employment that suited his physical and psychological condition. 135 Dr Bodel found that the plaintiff was currently totally incapacitated for work, and agreed that present conservative treatment was probably the most appropriate. His experience was that with such treatment the vast majority of people with similar pathology could become better within some indeterminate future time. He suggested that if the condition did not improve consideration be given to the possibility of treatment by peri-radicular block injection or decompressive surgery. He agreed the approach to be taken was one of trial and error, and the outcome of treatment options was speculative. 136 The medical evidence, taken overall, supports the finding, which I make, that the plaintiff's disability is a total and permanent disability as defined in cl 20.3. In my assessment, the evidence of Dr Bodel and Dr Westmore indicates no more than that there is a chance or possibility that the plaintiff's condition will improve. It left open for speculation the degree, extent, duration, and timing, of any improvement. 137 Doubtless because prospects and degree of improvement were left as matters of chance, there was no evidence which identified any occupation or form of work which the plaintiff could become capable of undertaking in the future. Accordingly, I was entirely unpersuaded of the likelihood that his present disability will improve sufficiently to enable him to again work in any occupation for which he is reasonably qualified because of education, training, or experience. In my opinion, as a matter of reality and common sense, the evidence negates such a finding. 138 I have not overlooked Westpac's submission that the plaintiff recovered sufficiently from the physical and mental injuries from the BHP accidents sufficiently to enable him to operate the business in Turkey, the patisserie, and to become a property developer. However, in light of the totality of the evidence about the 7 November, 2005 injury, including the plaintiff's, I gave that consideration little weight. 139 For the above reasons, I hold that the plaintiff would be entitled to an "Any Occupation" benefit under the policy, if it is held, contrary to my conclusion, that the policy remains on foot. Orders 140 I propose to order that the amended statement of claim be dismissed. 141 As to the question of costs, my present view is there should be an order that the plaintiff pay the defendants' costs of the proceedings. However, failing agreement, I will afford the parties the opportunity to address me on this issue. Arrangements should be made with my associate by 12 February 2010 for the re-listing of the matter. ********** 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.