George Maurice Norman Farkas v Northcity Financial Services Pty Ltd & 3 Ors [2004] NSWSC 206

George Maurice Norman Farkas v Northcity Financial Services Pty Ltd & 3 Ors [2004] NSWSC 206

On the proper construction of the policy, the terminal illness prognosis was to be made at the time of diagnosis on the presentation of the disease itself, without assuming treatment. On that basis, and even if available treatment were considered, the plaintiff's lymphoma was highly likely to result in death within 12 months at diagnosis, so Tower was liable for the terminal illness benefits under both the Tower Term and Critical Illness conditions. The negligence claims failed because the plaintiff was informed on 21 January 2002 that Tower had accepted him and the Court was not satisfied that any earlier notification would probably have led to a policy start date avoiding the 90 day...

Jurisdiction
Australia
Judgment Date
22 June 2004
Procedural Posture
Insurance Policy Construction and Alternative Negligence Claim in the Equity Division, Commercial List / Judgment After Hearing; Parties Directed to Bring in Short Minutes of Order
Outcome
Tower Australia Ltd is liable to pay terminal illness benefits totalling $750,000 to the plaintiff; the negligence claims are dismissed.
Legal Topics
['terminal Illness Benefits' 'critical Illness Insurance' 'construction of Insurance Policy Terms' 'meaning of Highly Likely' '90 Day Exclusion Period' 'insurance Broker Notification of Acceptance' 'cancer Diagnosis and Occurrence of Insured Event']
['insurance' 'negligence' 'contract Interpretation'] ['terminal Illness Benefits' 'critical Illness Insurance' 'construction of Insurance Policy Terms' 'meaning of Highly Likely' '90 Day Exclusion Period' 'insurance Broker Notification of Acceptance' 'cancer Diagnosis and Occurrence of Insured Event']

Case Brief

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Procedural Posture

Insurance Policy Construction and Alternative Negligence Claim in the Equity Division, Commercial List / Judgment After Hearing; Parties Directed to Bring in Short Minutes of Order

Legal Issues

  1. 1 ['Whether the plaintiff was diagnosed with a terminal illness within the meaning of the Tower Term Benefit Conditions and the Critical Illness Benefit Conditions.' 'Whether the phrase "highly likely to result in death within 12 months" required assessment of the disease with or without treatment.' 'Whether the occurrence of cancer for the Critical Illness Benefit was subject to the 90 day waiting period.' "Whether Tower, Northcity, K&M or Shar were negligent by failing to notify the plaintiff of Tower's acceptance in December 2001 and whether any delay caused loss."]

Ratio Decidendi

On the proper construction of the policy, the terminal illness prognosis was to be made at the time of diagnosis on the presentation of the disease itself, without assuming treatment. On that basis, and even if available treatment were considered, the plaintiff's lymphoma was highly likely to result in death within 12 months at diagnosis, so Tower was liable for the terminal illness benefits under both the Tower Term and Critical Illness conditions. The negligence claims failed because the plaintiff was informed on 21 January 2002 that Tower had accepted him and the Court was not satisfied that any earlier notification would probably have led to a policy start date avoiding the 90 day...

Court Disposition

Tower Australia Ltd is liable to pay terminal illness benefits totalling $750,000 to the plaintiff; the negligence claims are dismissed.

Orders

  • ['The fourth defendant is liable to pay Terminal Illness Benefits totalling $750,000 to the plaintiff.' 'Negligence claims dismissed.' 'The parties are to bring in Short Minutes of Order reflecting the findings.' 'The matter is listed at 11.30 am on 25 June 2004 for directions for the filing of Short Minutes of...