Canada Life Assurance Ireland Ltd v O Connor

• Jurisdiction: Ireland
• Judge: Mr. Justice Quirke
• Judgment Date: 02 October 2006
• Neutral Citation: [2006] IEHC 286
• Date: 02 October 2006
• Court: High Court

[2006] IEHC 286

THE HIGH COURT

[No. 466S/2003]

CANADA LIFE ASSURANCE IRELAND LTD v O'CONNOR

BETWEEN

CANADA LIFE ASSURANCE IRELAND LIMITED

PLAINTIFF

AND

LIAM O'CONNOR

DEFENDANT

Abstract:

Abstract Here

1 JUDGMENT of the Hon. Mr. Justice Quirke delivered the 2nd day of October 2006 .

2 In this case the plaintiff (hereafter called "Canada Life") employed the defendant Liam O'Connor on 28th May, 1989. Mr. O'Connor's job was to sell the Canada Life's financial products which were principally, (a) insurance policies and (b) saving and retirement accounts.

3 Mr. O'Connor worked for Canada Life for thirteen years until he was dismissed by his employer on 20th September, 2002. He has commenced proceedings against Canada Life claiming that his contract of employment was unlawfully terminated. These proceedings are unconnected with that claim.

4 It was a term of Mr. O'Connor's contract of employment that if, during the course of his employment, he was incapacitated by ill health and unable to do his job he was entitled to receive disability monthly allowances whilst so disabled under the terms of a Disability Income Benefit Scheme provided by his employer.

5 In order to qualify for receipt of those monthly allowances it was necessary for him to provide his employer with doctors certificates which confirmed his disability and unfitness for work.

6 During the ten month period between December, 2001 and September, 2002, Mr. O'Connor provided his employers with certificates from his doctors which certified that he was incapacitated during those months by ill health and was unable to do his normal job.

7 With the support of those certificates Mr. O'Connor claimed from Canada Life and was paid disability allowances totalling €82,929.44.

8 In these proceedings Canada Life seeks repayment of that sum of €82,929.44 on a number of grounds and alternatively as damages for alleged breach of contract, conversion and misrepresentation on the part of Mr. O'Connor.

9 In summary, Canada Life claims that it is entitled to recover the sum from Mr. O'Connor because it claims that during the ten month period during which he was paid the disability allowances Mr. O'Connor was capable of working and was in fact working at his normal job.

RELEVANT FACTS

10 I am satisfied that the following facts have been proved by way of evidence in these proceedings.

11 1. During the course of his employment with Canada Life Mr. O'Connor was remarkably successful in selling Canada Life's products. His success was acknowledged by his employer on several occasions and by other associated organisations.

12 His income, arising out of his success, was substantial. His value to Canada Life was also considerable because Canada Life benefited from the very large amount of business which he sold on behalf of his employer.

13 2. Towards the end of the year 2000 and the beginning of the year 2001, the Irish Government introduced Special Savings Investment Accounts (hereafter "SSIA's") for the benefit of its citizens.

14 These savings accounts offered very attractive returns to investors who were prepared to open such accounts between May, 2001 and May, 2002.

15 Mr. O'Connor who, by the year 2001, had introduced more than 3000 clients to Canada Life wrote a circular letter (called a "mailshot") to all the clients whom he had earlier introduced to his employers. The mailshot encouraged the clients to open SSIA's with Canada Life and invited the clients to contact Mr. O'Connor.

16 The mailshot was successful. Large number of clients contacted Mr. O'Connor and opened SSIA accounts with Canada Life.

17 3. In early November, 2001 Mr. O'Connor was attacked by criminals who assaulted him with a car jack and beat him severely in an attempt to rob him.

18 As a result of the injury sustained in that attack Mr. O'Connor was unable to work and remained home.

19 Whilst he was at home he suffered a very severe injury when a lawnmower was pulled onto his foot which was pulverised by the blades of the lawnmower. His injuries included the amputation of one of his toes.

20 The injury was very severe and the surgeon who treated him recommended that he shouldn't work for a number of months.

21 Because a large number of clients continued to contact him and to contact Canada Life in response to his mailshot Mr. O'Connor felt under pressure and was suffering significant stress at this time. Additionally Canada Life wished to know when he would be in a position to resume work.

22 He began to suffer psychological symptoms which were complicated by the fact that Canada Life was, concurrently, investigating a complaint which had been made about Mr. O'Connor and which is unrelated to these proceedings.

23 By reason of his injuries and ill-health a disciplinary hearing which was intended to investigate the complaint against Mr. O'Connor was postponed in December, 2001 and rescheduled for February, 2002.

24 With the exception of a number of days in February, 2002 Mr. O'Connor provided medical certificates from his treating doctors which certified that he was unfit to work during the entire of the period between December, 2001 and September, 2002 when he was dismissed from his employment.

25 Mr. O'Connor attended the disciplinary investigative meeting in February, 2002. At that time and during the meeting he was still suffering from his physical injuries and was also suffering from stress and psychological illness.

26 The meeting was described by a witness on behalf of Canada Life as "inconclusive". Mr. O'Connor was advised not to work and not to contract clients and he agreed not to do so.

27 The resumed meeting was also described as "inconclusive" by the same witness.

28 Mr. O'Connor was still suffering from his physical injuries and from psychological symptoms. He was still receiving constant calls from his clients and when he attended Canada Life's premises on a number of occasions he was told to go home by his immediate superior (Mr. McGrath), and by other members of the staff.

29 In May, 2002 Mr. O'Connor removed 400 client files from the office of Canada Life without authorisation.

30 When his employers discovered that he had taken the files they contacted him and required that he return them. He did so and admitted that his actions were "fool hardy". He apologised stating that he "didn't realise the serious implications of what I was doing."

31 In May, 2002 Mr. O'Connor was referred by his general practitioner to Dr. Elizabeth Cryan who is a Consultant Psychiatrist. Dr. Cryan was concerned. Her professional opinion was that Mr. O'Connor was presenting with depressive symptoms, having been in contact with the suicide of his wife's nephew. She was satisfied that Mr. O'Connor was himself suicidal at that time for a variety of reasons.

32 Dr. Cryan diagnosed an adjustment disorder with accompanying depressive and anxiety symptoms. She felt that Mr. O'Connor was suffering from significant stress resulting from his earlier physical injuries, his marital difficulties, and his work place problems. His condition had been exacerbated by anxiety in relation to his income.

33 Dr. Cryan treated Mr. O'Connor by way of combination of medication including anti-depressants. She then referred him for psychological support to a clinical psychologist who treated him on a weekly basis.

34 4. In early 2002, Mr O'Connor was receiving a very large number of inquiries from clients who wished to open SSIA accounts. At this time he was concerned about his income and financial circumstances. Accordingly, he made an arrangement with an insurance broker named Raymond O'Neill. This arrangement was made with the collaboration of a Mr. Gavin Glass who was then a Consultant Broker in Canada Life (i.e. he canvassed business on behalf of Canada Life from assurance brokers). The arrangement was intended primarily to accommodate the interests of Mr. O'Connor, Mr. O'Neill and, indirectly, Mr Glass. However, Canada Life benefited also.

35 The arrangement which was made was that, whilst he was ill, Mr. O'Connor would channel his clients to Canada Life through the brokerage of Mr. O'Neill who would receive commission from Canada Life in return for that business.

36 It is agreed between Mr. O'Connor and Mr. O'Neill that when Mr. O'Connor was fit to resume his employment with Canada Life, Mr. O'Neill would transfer the clients back to Mr. O'Connor who would then be entitled to receive the commission from Canada Life for that business under the terms of his contract of employment with Canada Life. That business also comprised a beneficial factor in the calculation of Mr. O'Connor's pension entitlements on retirement from Canada Life.

37 The benefit which Mr. Gavin Glass received from the arrangement was credit resulting from the increase in business from brokers whilst the business was being channelled through Mr. O'Neill's brokerage.

38 The arrangement which Mr O'Connor made with Mr. O'Neill was designed to preserve the business which he felt he had obtained on behalf of Canada life so that he could receive the appropriate commission benefits from Canada Life for that business when he was fit to resume his employment with Canada life.

39 5. During the 10 month period between December, 2001 and September, 2002 Mr. O'Connor received no money or benefit from Mr. O'Neill or from Canada Life or from any other source by way of commission or otherwise arising out of the business which went to Canada Life as a result of this arrangement.

40 Mr. O'Connor did not seek or obtain business for any other company during this time or receive any payment of any kind whatsoever for any work done on behalf of Canada life or on behalf of any other company or person during this time. His income was...