This case explores the disablement concept of the insured person being unable to work in "any" occupation based on the skills and knowledge the person acquired through previous education, training and experience.
The member was born in a South Asian country and emigrated to Australia when he was 16 whereupon he enrolled in Year 11 but did not complete the year. He therefore had little formal education in Australia. Further, while he lived in Australia for 23 years, he had limited command of English.
The member worked as a process worker/product assembler and on 7 April 2010 he injured his back while at work. He was given light duties, but ceased work on 15 February 2011 and resigned on 5 September 2011. There was also evidence the member had suffered bullying and harassment while at work.
In May 2012, the member lodged a total and permanent disablement (TPD) claim. He asserted he was unable to work due to chronic pain to his back, knees, shoulders, and Achilles heel. He also suffered depression and anxiety. The member was initially receiving workers compensation and, as part of the state-based WorkCover Authority, he attempted a work placement with another employer for three hours per day, four days of the week. The work placement ceased in February 2013 and he had not worked since.
The Superannuation Complaints Tribunal reviewed a significant number of medical and allied health professionals' opinions and noted that the majority view was that the member "was capable of manual work, with limitations, possibly part-time. However, the failure of his extended treatment, his inability to concentrate and loss of memory, coupled with his psychiatric condition, lack of education, transferable skills, poor English and belief that he needed to recover his physical health in order to work, an outcome not achieved since 2011, meant there was a limited possibility of a return to work".
Under the contractual terms of the policy, the critical question was whether the member would ever be able to engage in any occupation, based on the skills and knowledge he had acquired through previous education, training and experience. Accordingly, a psychiatrist's view that his mental health would improve if he went back to work did not throw any light on what work he could actually do from the perspective of his mental health. The Tribunal wanted to know what real process work in a real manufacturing/assembly line the member would be capable of performing. A glib remark in a medical report, to the effect the member was capable of moderate levels of manual work with modest restrictions, missed the point.
The trustee and insurer had not commissioned any independent medical examination, nor a vocational assessment report, having decided to rely on evidence collected for the Authority. This was the subject of additional criticism by the Tribunal given it is well known that the Authority's doctors would not be focusing on the precise definition of disablement in the policy.
The Tribunal pointed out the judgment of Justice Leeming in Shuetrim's Case (2016) 332 ALR 507:
"To make an assessment of TPD, it is not sufficient for the insurer to be satisfied that it is more likely than not that the person will never return to relevant work. On the other hand, if there is merely a remote or speculative possibility that the person will at some time in the future return to relevant work, an insurer will not, acting reasonably and in compliance with its duties, be able to be satisfied that the person is not TPD. The critical distinction is between possibilities which are readily contemplatable even though they may not be more probable than not, and possibilities which are remote or speculative."
In this case, the Tribunal held that the member had only a remote or speculative possibility of returning to work with the consequence he was TPD within the definition of the policy. It therefore set aside the decisions of the trustee and insurer and made an order for the member to be paid the insured benefit, with interest at the statutory rate under section 57 of the Insurance Contracts Act 1984 (Cth), from the date the insurer first advised the trustee of its decision to reject the claim.
This case explores an insurer cherry-picking medical evidence to deny a claim and the trustee's duty to do everything that is reasonable to pursue the claim, if it has a reasonable chance of success.
The member had been living in Australia for over 20 years.
In her country of birth she had trained as a chef and worked in retail but in Australia she had consistently worked as a cleaner. She had limited English and the Tribunal noted that the role of a cleaner meant she was not required to have verbal interactions with others. Her most recent job involved cleaning on a permanent part-time basis for 25 hours a week.
On 30 January 2012, the member slipped and fell at a local supermarket sustaining a lower back injury. She was unable to return to work and in October 2013 she lodged a TPD claim.
The insurer denied the claim in October 2014 and the trustee conveyed its independent acceptance of the insurer's decision to deny the claim in July 2015. Both the trustee and insurer regarded the member's medical condition as complex.
According to the definition of TPD in the policy, it was necessary to determine if the member was unlikely to return to work in any occupation by reason of her education, training and experience. The Tribunal held that viewing the member's work background, it had little difficulty in accessing her future work prospects as limited to cleaning.
Much of the medical evidence suggested the member had the physical capacity to return to cleaning part-time.
However, Dr NB, the insurer's medical expert, went on in his supplementary report to conclude that "when considering her overall presentation and not just considering the underlying biomedical injury ... the probability that she [would] return to work as a cleaner would have to be considered to be low".
The Tribunal then criticised the trustee and insurer who had both "studiously avoided" the final remarks of Dr NB in their submissions. The Tribunal noted that such cherry-picking of the medical evidence did "not sit favourably with the courts".
It was also pointed out that the trustee has to be cognisant of its obligations under section 52(7)(d) of the Superannuation Industry (Supervision) Act 1993 (Cth). That section requires the trustee to pursue an insurance claim if it has reasonable chances of success. In the Tribunal's view, this required the trustee to exercise vigilance so as to ensure the insurer viewed the entirety of Dr NB's report and, "at the very least, the Tribunal... expected the trustee to properly draw the Tribunal's attention to the appropriate context, against which Dr NB's remarks should be gauged".
After carefully reviewing all the medical evidence, the Tribunal concluded that it was unlikely the member would engage in manual work such as cleaning, either full-time or part-time, as any other conclusion was a remote or speculative possibility, as held by Justice Leeming in Shuetrim's Case  NSWCA 68. The Tribunal found the member to be TPD and ordered the insurer to pay the trustee the insured amount together with interest at the statutory rate under section 57 of the Insurance Contracts Act 1984 (Cth), from the date the insurer first advised the trustee of its decision to reject the claim.
This article was first published in Super Funds, 1 September 2017.