Coleman v New Ireland Assurance Plc (t/a Bank of Ireland Life)

• Jurisdiction: Ireland
• Judge: Mr. Justice Clarke
• Judgment Date: 12 June 2009
• Neutral Citation: [2009] IEHC 273
• Court: High Court
• Date: 12 June 2009

[2009] IEHC 273

THE HIGH COURT

[No. 2031 P./2005]

Coleman v New Ireland Assurance Plc (t/a Bank of Ireland Life)

BETWEEN

CAROLINE COLEMAN

PLAINTIFF

AND

NEW IRELAND ASSURANCE PLC TRADING AS BANK OF IRELAND LIFE

DEFENDANTS

KEATING v NEW IRELAND INSURANCE COMPANY 1990 2 IR 383

Abstract:

Contract law - Practice and procedure - Contract of insurance - Non disclosure of material fact - Whether the plaintiff failed to disclose a material fact of which she was aware - Whether the plaintiff failed to answer questions raised in the proposal form to the best of her ability and truthfully.

Facts The plaintiff, who was diagnosed with Multiple Sclerosis (MS) some time after she entered into an insurance policy with the defendant sought payment from the defendant in the sum of €95,231, by way of Critical Illness Cover as provided for in her policy of insurance. The defendant accepted that the plaintiff prima facie qualified for the payment under the terms of the policy. However, the defendant sought to defend these proceedings on the basis that the plaintiff failed adequately to disclose material matters at the time when the insurance policy was first put in place. The plaintiff provided incorrect information in relation to previous medical appointments and medical tests. Essentially, the plaintiff failed to disclose that she had suffered problems with her eyesight in 1990 and was referred to a specialist and underwent tests as a result. The plaintiff's general practitioner gave evidence that he was concerned the aforementioned symptoms might be indicative of MS but he did not convey those concerns to the plaintiff at that time. The plaintiff did not suffer any other symptoms of MS between the incident in 1990 and the date she signed the proposal form some eight years later and she gave evidence that she had completely put that incident out of her mind by the time she completed the insurance forms.

Held by Clarke J. in favour of the plaintiff: That there was no doubt but that the answer to at least two questions raised on the proposal form were inaccurate. However, the non disclosed information related to events that occurred eight years prior to the completion of the proposal form. On balance, it appeared it was not intimated to the plaintiff that there was any ongoing risk arising from her condition in 1990 and there was no reoccurrence or any other relevant symptoms prior to the completion of the proposal form. The plaintiff had put the entire incident out of her mind and consequently the plaintiff answered the questions raised in the proposal form truthfully and to the best of her knowledge as it then was. The plaintiff was entitled to the recovery of the sum of €95,230.76 together with Courts Act interest from 1 July 2004 to date.

Reporter: L.O'S.

1. Introduction

2 2 1.1 The plaintiff ("Ms. Coleman") has unfortunately been diagnosed with Multiple Sclerosis ("MS"). Some time ago, in circumstances which it will be necessary to explore, she entered into an insurance policy with the defendants ("New Ireland") which included so called Critical Illness cover. Part of the relevant policy terms provided for the payment to Ms. Coleman of €95,231 (originally IR£75,000) in the event of her coming to suffer from various specified illnesses, including MS. On that basis, Ms. Coleman claims to be entitled to the payment of that sum.

3 3 1.2 New Ireland accept that the conditions necessary for the payment of the sum have arisen in that it is accepted that Ms. Coleman prima facie qualifies for the payment concerned under the terms of the policy. However, New Ireland seek to defend these proceedings on the basis of what is said to have been a failure adequately to disclose material matters at the time when the insurance policy was first put in place. Before detailing the precise issues which arise between the parties it is appropriate to turn, therefore, to the facts, most of which are not in controversy between the parties.

2. The Facts

2 2 2.1 Ms. Coleman was born in December, 1972. In the late 1990s, she was engaged in the purchase of a house which involved obtaining a mortgage facility from Bank of Ireland. In that context she was required to take out life protection cover. New Ireland operates within Bank of Ireland as a provider of such assurance. With that in mind, an appointment was arranged by Ms. Coleman's local Bank of Ireland branch with a representative of New Ireland, for the purposes of seeking to put in place the relevant cover.

3 3 2.2 Ms. Coleman's initial requirement was for cover in the sum of IR£60,000. Following a discussion with and advice from New Ireland's representative, it was decided that Ms. Coleman would apply for what was called "living cover". That form of cover included both a standard life cover which would result in the sum of IR£60,000 being paid on Ms. Coleman's death, but also critical illness cover in the same sum which would result in Ms. Coleman being paid the sum in question in the event that she should suffer from one of the specified illnesses detailed in the policy.

4 4 2.3 At the same meeting Ms. Coleman signed a proposal form which, as is normal practice, contained within it various questions concerning, amongst other things, Ms. Coleman's health history. It is agreed by all witnesses that what in fact happened was that the New Ireland representative concerned read out the questions to Ms. Coleman and filled in the answers, as given by Ms. Coleman, in her own handwriting. Ms. Coleman then signed the document in question. It was also accepted by Ms. Coleman that the representative concerned had explained to her, in advance of going through the specific questions, the importance of making full disclosure of any material matters concerning her health.

5 5 2.4 It is again common case that the proposal was accepted on what were normal terms subject to one matter. Ms. Coleman disclosed, in answer to one of the relevant questions, that she had had some difficulties with her back. While not material, in itself, to these proceedings it should be noted that the policy concerned contained, by agreement, an exclusion in relation to critical illness cover by reference to that back trouble.

6 6 2.5 The following year Ms. Coleman wished to increase the level of her cover from IR£60,000 to IR£75,000. On the occasion in question it would seem that a further application form and questionnaire was filled in. The evidence given on behalf of New Ireland suggests that it was New Ireland's practice at that time, that persons seeking a top up form of insurance would be asked to fill in the relevant questionnaire (or, perhaps, more accurately would be asked the questions from which the representative concerned would fill in the answers), by reference only to any material changes in the situation from the time when the original proposal form was put in place. It is fair to say that the proposal form concerned does not say that in terms. Indeed, the wording of the proposal form is no different in the case of a top up proposal, on the one hand, or an original proposal, on the other hand. In other words, the person concerned is asked for any relevant medical details under various headings, irregardless of the time period from which the relevant medical details might stem. That position remains the case where a top up insurance is put in place. In any event all of the questions on the top up proposal form were answered in a way which disclosed no medical difficulties. Strictly speaking the top up proposal form is, therefore, on any view, incorrect. Ms. Coleman had disclosed a number of matters in her original proposal form which were not repeated in the proposal form for top up insurance. However, on the basis of the evidence from New Ireland, I am satisfied that, as a matter of probability, Ms. Coleman was informed that it was unnecessary to make any further disclosure in relation to issues already disclosed on the original proposal form. On that basis, it is clear that the real question that needs to be answered in these proceedings concerns the disclosure set out in the original proposal form.

7 7 2.6 In particular, two aspects of that proposal form are relied on by New Ireland.

8 8 2.7 The section of the proposal form dealing with medical history is section D. In part 3 of section D, the proposer is invited to identify the name and address of the proposer's doctor and to "give the date and reasons for any visits you have made, including the results of any checkups". The answer given to that question in the original proposal form is simply flus/colds. In addition the proposer is asked "have you seen any other doctors or specialist?" The answer to this question is no. As will become clear there is no doubt, as a matter of fact, that both of those answers are incorrect.

9 9 2.8 Parts 4 and 5 of section D ask the proposer whether the proposer had ever suffered from various conditions. Under 4(h) there is a disclosure of the back injury to which I have made brief reference earlier. Under part 5(c) the proposer is asked whether the proposer had "any other tests or suffered any other illness?" The only disclosure under that heading is to the effect that there had been tests for suspected gallstones which were negative and had not given rise to any subsequent problems.

10 10 2.9 There is no other disclosure in respect of any tests carried out or illnesses suffered. It is again clear that, as a matter of fact, those answers are also incorrect.

11 11 2.10 Against that background it is necessary to go back to a time some eight years prior to the proposal form being filled in. At the time in question, Ms. Coleman was...