Life insured ordered to attend a subsequent medical examination
29 July 2015
The Supreme Court of NSW has made orders regarding the attendance by a life insured (who was not a party to the proceedings) at a second medical examination.
An interlocutory application in Angela Campbell Pty Ltd as trustee for Halina Superannuation Fund v Westpac Life Insurance Services Limited (Unreported Judgment, 29 June 2015) Supreme Court of New South Wales (Equity Division)
The plaintiff is the trustee of Angela Campbell's (the life insured's) superannuation fund and the owner of a policy of life insurance issued by the defendant. The plaintiff claimed a sizeable Total and Permanent Disability benefit (the TPD benefit).
The life insured, Dr Angela Campbell, claimed the TPD benefit due to a psychiatric illness.
Dr Campbell was examined at the request of the insurer by a psychiatrist in August 2014. That psychiatrist did not make any diagnosis or come to any conclusion regarding Dr Campbell's ability to work and so after proceedings were commenced, the insurer arranged for an examination with a different psychiatrist.
The plaintiff objected to Dr Campbell attending the further examination, relying upon a term of the policy that provided:
At any time after we receive the claim forms, we may ask you or the Insured Person for more information or for an authority to obtain more information. You, or the Insured Person, must give us that information or authority. We may also choose a registered medical practitioner to examine the Insured Person. (Our emphasis).
The plaintiff argued that the policy should be interpreted as providing that Dr Campbell could only be examined by a single medical practitioner, and that, as she had already been reviewed by a psychiatrist, she had complied with her obligations under the policy.
The insurer filed a motion seeking orders that Dr Campbell attend the examination with the psychiatrist, or alternatively, that the plaintiff compel her to attend the examination and that the proceedings be stayed until she attended the examination.
The motion was heard by Justice Brereton who delivered an oral judgment on 29 June 2015 in favour of the insurer and ordered Dr Campbell to attend the appointment with the psychiatrist.
The arguments and decision
The Courts' specific power to order attendance at a medical examination (under UCPR, Part 23) is limited to parties to the proceedings. The life insured, Dr Campbell, was not a party.
The insurer thus relied upon the unreported decision of Registrar Musgrave delivered on 20 September 2013 in Magda de Berg v Westpac Life Insurance Services Limited1 where it was held that the powers under the Uniform Civil Procedure Rules, Part 2, Reg 2.1 in relation to the just, quick and cheap resolution of proceedings provided the Court with a necessary adjunct where the Rules had not contemplated a particular scenario, and would yield an undesirable result if they were to be applied literally and that therefore the life insured in that case could be compelled to be medically examined at the request of the insurer.
Justice Brereton ordered Dr Campbell to attend the appointment, relying upon the decision in Kurnell Passenger and Transport Service Pty Ltd v Randwick City Council2 where it was acknowledged that there are cases, where a person who is not a party, should be required to submit to a medical examination. Justice Brereton held that in these proceedings, where the interests of the plaintiff and the life insured were closely aligned and where the proceedings were brought by the plaintiff for the benefit of the life insured, the interests of the plaintiff and the life insured were indistinguishable, and there would be no injustice in ordering a stay should the life insured fail to attend the appointment with the psychiatrist.
Justice Brereton further held that the shortcomings of the existing psychiatric report made it in the interests of justice that Dr Campbell should submit to a further examination.
It is not unusual that the policy owner and/or beneficiary under the Policy are not the life insured.
This decision will be helpful for insurers who are placed in a position where they are unable to compel a life insured to comply with investigations, including medical examinations, because the NSW rules do not yet expressly contemplate situations where the life insured is not a party to proceedings. This decision confirms that the Court can compel examinations (including subsequent examinations) of life insureds who are not a party to proceedings, where the interests of the plaintiff and the life insured are closely aligned.
1 (Unreported Judgment, 20 September 2013) Supreme Court of New South Wales (Equity Division).
2  NSWCA 59.