MERCANTILE MUTUAL INSURANCE COMPANY LTD v BENSKY [2000] WASCA 148 (15 May 2000)

Last Updated: 4 August 2000

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT : THE FULL COURT (WA)

CITATION : MERCANTILE MUTUAL INSURANCE COMPANY LTD -v- BENSKY [2000] WASCA 148

CORAM : KENNEDY J

ANDERSON J

SHELLER AJ

HEARD : 15 MAY 2000

DELIVERED : 15 MAY 2000

FILE NO/S : FUL 112 of 1999

BETWEEN : MERCANTILE MUTUAL INSURANCE COMPANY LTD

Appellant

AND

KEITH BENSKY

Respondent

Catchwords:

Appeal and new trial - Sufficiency of reasons for decision - No failure on part of trial Judge to make critical findings - Turns on own facts

Legislation:

Nil

Result:

Appeal dismissed

Representation:

Counsel:

Appellant : Mr J D Hislop & Mr G A Rabe

Respondent : Mr A Metaxas

Solicitors:

Appellant : Godfrey Virtue & Co

Respondent : Arthur Metaxas & Co

Case(s) referred to in judgment(s):

Case(s) also cited:

Fabre v Arenales & Anor (1992) 27 NSWLR 437

Federal Broom Co Pty Ltd v Semlitch (1964) 110 CLR 626

Ramsay v Watson (1961) 108 CLR 642

1 KENNEDY J: I invite Acting Justice Sheller to deliver the first judgment.

2 SHELLER AJ: This is an appeal from a judgment given by his Honour Judge H H Jackson on 15 July 1999. The respondent Mr Keith Bensky, who was born on 20 January 1951, entered into a contract of insurance with the Occidental Life Insurance Co in July 1986. The insurance was described as an income security plan and is hereafter referred to as "the policy". The rights and liabilities of the insurer under the policy were acquired by the appellant Mercantile Mutual Insurance Co Ltd.

3 At the time that he entered into the contract of insurance Mr Bensky was carrying on a small retail furniture business in Victoria Park trading under the name K & R Bensky. After 1987 he became the sole proprietor of that business. There was evidence that at that time, apart from his business activities, he was a regular tennis player and runner.

4 On 22 March 1989 he married Sandra Wilson. On or about 1 March 1989 he had suffered chest symptoms, as a result of which he was admitted to Royal Perth Hospital. He was diagnosed as suffering from viral pericarditis, pleurisy and pneumonitis. Late in 1989 Dr Traub diagnosed chronic fatigue syndrome.

5 After Mr Bensky's illness in 1989, the business ran for approximately 19 months, until it finally closed in October 1990. His evidence was that during that time he was frequently too ill to go into work, and that on occasion the business closed midweek and on occasion closed early. The evidence was that since the business closed in October 1990 Mr Bensky had not worked.

6 On 4 December 1990 he claimed under the policy. His claim was certified by Dr Fine. The appellant accepted the claim and Mr Bensky received disability payments in accordance with the policy for some time thereafter. During that period Dr Fine regularly certified disability. Early in 1993 the appellant advised that payments would cease to be made under the policy and that in fact happened.

7 In 1995 Mr Bensky issued the writ in these proceedings against the appellant. His claim was based on total disablement under the policy. The appellant defended the claim. The appellant's attitude was that Mr Bensky was not entitled to any payments under the policy. The terms of the policy are referred to in detail so far as relevant in the judgment appealed from. Sufficient for present purposes is to say that under the policy the appellant agreed to pay $24,000 a year at the rate of $2,000 per month after a qualification period of 13 weeks. The benefit expiry date was 23 July 2015.

8 The appellant's agreement so far as relevant was periodically to pay the total disability benefit during Mr Bensky's continuous total disability. Total disability was defined in the policy to mean:

" ... because of Injury or Sickness:

(a) You are unable to perform the important duties of your regular occupation; and

(b) You are not engaged in any gainful occupation; and

"Sickness" was defined as meaning "sickness or disease which first manifests itself after the Date of Issue and while Your Policy is in force".

9 In his judgment of 15 July 1999 Judge H H Jackson gave judgment for Mr Bensky and made declarations and orders accordingly. From this decision, as I have said, the appellant appeals. The grounds of appeal as relied on in the written submissions and the oral submissions put to the Court this morning go to the structure of the reasons for judgment.

10 In short, the appellant submits that the trial Judge failed to make the critical finding that Mr Bensky suffered from the symptoms which he described and which the appellant denied, which were the bases for the conclusion of a significant number of doctors that he suffered from chronic fatigue syndrome, as a result of which he was unable to work. Put bluntly, the appellant at the trial and on this appeal urged that Mr Bensky was a malingerer and accordingly he did not satisfy the conditions of the definition of total disability.

11 We were taken to various parts of the reasons for judgment where the trial Judge set out with care and a degree of particularity the evidence that had been given both by lay and medical expert witnesses. For my own part, I find the appellant's basic submission difficult to accept. I do not think it necessary or, indeed, desirable to go through in detail those parts of the evidence which his Honour carefully set out.

12 I have read through those parts of the evidence and it is clear enough from reading them that there was ample evidence upon which it was open to his Honour to conclude that Mr Bensky suffered from the symptoms which he described and open to conclude that based on those symptoms he suffered, according to the medical evidence, chronic fatigue syndrome. The argument that is put is that, as I understand it, although it may have been open, his Honour did not squarely say whether or not he accepted that evidence.

13 Towards the end of the reasons for judgment, under the heading of "Conclusion", his Honour referred to psychiatric evidence and said that was all to the effect that the plaintiff was not suffering any psychiatric disorder. His Honour then said:

"The issue is one of whether he is suffering physically disabling symptoms. As to that, Mr Rabe [who appeared at the hearing and appears as Mr Hislop's junior on this appeal for the appellant] says the issue is to be determined on the evidence of the plaintiff and other non-medical witnesses and that of the physicians and immunologists."

His Honour referred to those medical professionals and said:

"Apart from Dr Zilko their evidence seems to me to support the plaintiff's case."

His Honour then put aside the suggestion that he should undertake a diagnostic task based upon material put before him about the symptoms of chronic fatigue syndrome. He said:

"My task, given the relevant onus and standard, is to decide the issue by reference to the evidence put before me and where there is expert evidence thereon to use that as a basis of my decision."

Some attack was made upon this statement but it seems to me understood in the context of this case an appropriate one. His Honour said that he was mindful of what King CJ had said in Ivkovic v Rinaldi (1980) 25 SASR 516 at 519 - 520, which his Honour quoted. He then said:

"Of course questions of credibility of the plaintiff and other witnesses are matters for the trial Judge, as are questions of primary fact-finding and issues of the inferences to be drawn therefrom."

That seems to me an entirely appropriate statement of the task that his Honour was faced with on this trial. Then various matters that formed part of the appellant's submissions at trial were referred to. One of those, which again was referred to on the appeal, was Mr Bensky's condition before he suffered the illnesses in 1989 to which I have referred. Of that his Honour observed that the medical history in his view did not support the defendant's proposition.

14 He referred to the evidence that had been given by Mr Bensky's first wife, Sandra Wilson, now Mrs Kerr, whom he married, as I have said, in 1989 and from whom he subsequently separated. Mrs Kerr, who has now remarried, gave evidence of her observations of Mr Bensky both before and after the 1989 illness. Of this evidence the learned trial Judge observed:

"Nor can there be any doubt that Mrs Kerr at least initially was bitter when the plaintiff left her for his present wife. Whilst she is extremely critical of him she lived with him for 8 years then married him and stayed with him until he left her. Her evidence must be looked at in that light."

His Honour went on:

"Nor is there any doubt that prior to his 1989 illness the plaintiff was fit and at least in sporting terms, very active. He took out the policy in 1986 during that period. There is no doubt that he then suffered a serious illness diagnosed as pericarditis pleurisy and pneumonia. The medical evidence all supports the proposition that such an illness is now recognised as a possible catalyst for post-viral illness including chronic fatigue syndrome."

He then referred to the argument that Mr Bensky was a malingerer. A little further on his judgment his Honour said:

"As I understand it, my task is to decide whether the plaintiff qualified under the terms of the policy between the date in 1993 when payments were terminated and trial. I can make no findings as to future benefits."

Again what his Honour said seems to me appropriately to describe the task that he was there to undertake. He went on to say:

"I point out that while much of the evidence was naturally concerned with chronic fatigue syndrome, the real issue is not the correct clinical name for any chronic medical problems but the legal issue of whether the plaintiff is disabled by sickness or disease which first manifested itself after the issue of the policy and because of which he is ... "

and his Honour then set out the terms of the policy which I have referred to, being the conditions which satisfy the condition for total disability. He referred to an argument advanced by the defendant and then said:

"I agree with Mr McGowan [who appeared at the trial for the plaintiff], however, that those practitioners in the best position to compare the progress of the plaintiff over this period have become firmer in their views (Dr Fine, Dr Annear, Dr Traub) to which must be added the opinions of those to whom thereafter the plaintiff was referred who also concur that the plaintiff suffers from not only chronic fatigue syndrome but that it is totally disability in the sense required by the policy (Dr German, Dr Tannebaum). Of the witnesses only the evidence of Mrs Kerr and Mr Mustac positively attacks the plaintiff's credibility on issues of truthfulness. I have addressed the evidence of Mrs Kerr. Mr Mustac is alone amongst the medical professionals. The objective evidence tends, however, to support the plaintiff in my view.

I am satisfied on the balance of probabilities that the claim succeeds."

Mr Hislop took us to that part of the evidence which his Honour may have had in mind when he referred to the "objective evidence". Mr Hislop pointed out that that evidence was not expressed by the medical practitioner concerned to be a diagnosis of chronic fatigue syndrome. However, an examination of what the doctor said in his report and his oral evidence both in chief and under cross-examination suggests that his Honour correctly described that as evidence which tended to support the plaintiff.

15 I accept that trial Judges should indicate clearly which parts of the evidence of the witnesses they accept. That requires the use of no particular language. But I regard it as plain that in his reasons for judgment in the section headed "Conclusion", and in particular in the last two paragraphs which I have quoted, his Honour accepted Mr Bensky's account of the symptoms from which he suffered.

16 As I understand it, the appellant accepts, but, if not, the medical evidence is overwhelming, that on the basis of those symptoms Mr Bensky suffered from chronic fatigue syndrome which was disabling in the way which satisfied the total disablement condition in the policy. His Honour carefully reviewed the evidence. To my mind it would be quite extraordinary to suggest that his Honour, having carefully weighed up the evidence and reached the conclusions that he did, had not accepted what Mr Bensky said about his condition and the medical evidence based upon what Mr Bensky said.

17 Accordingly, in my opinion, the appeal should be dismissed with costs.

18 KENNEDY J: I agree with the reasons expressed by Sheller AJ and have nothing to add.

19 ANDERSON J: I also agree and do not wish to add anything.