TPD or not TPD? That is the question

10 October 2016

The recent District Court of Queensland decision of Reynolds v Sunsuper Pty Ltd & Anor [2016] QDC 129, regarding the plaintiff’s entitlement to a Total and Permanent Disablement (TPD) benefit, has potentially provided some long awaited certainty on the application of the Date of Assessment in Queensland.


Lisa Reynolds (plaintiff), a 55 year old member of the superannuation trust fund Sunsuper resigned from her employment as a head gardener on 1 December 2011, claiming recurring skin cancers.

On 25 September 2013, the plaintiff claimed a TPD benefit from Sunsuper, whom held a policy of insurance for its members with AIA Australia Limited (AIA). The plaintiff’s claim for a TPD benefit was rejected on 2 January 2014 on the ground that she was not TPD within the Policy definition.

The plaintiff did not accept the rejection of her claim, and subsequently brought proceedings against Sunsuper and AIA seeking payment of the TPD benefit.

The decision

Prior to Dorney QC DCJ handing down his judgment, it was agreed between the parties that Dorney QC DCJ might confine his determination to whether the plaintiff met the TPD definition as at 1 March 2012 (the Date for Assessment), being the first date upon which the plaintiff could meet the criteria for TPD pursuant to the Policy definition.

On 7 June 2016, Dorney QC DCJ delivered judgment for the defendants, finding that the plaintiff did not establish her entitlement to a TPD benefit. He found that, as at 1 March 2012, he was not satisfied on the balance of probabilities that the plaintiff came within the ambit of the definition of TPD in the Policy.

The following emerges from the judgment:

  • An insured member can be precluded from meeting the TPD definition in question if there is available to him or her regular casual work (whereas previously only full-time or part-time work had been successfully relied upon to preclude an insured member from being eligible to meet the TPD definition).
  • An occupational therapist may be insufficiently qualified to provide a reliable opinion on vocational issues.
  • The test for whether an insured member is unlikely ever to return to any occupation within their education, training or experience (ETE), as is usually stipulated in TPD definitions, is not concerned with the availability of employment or work to the insured member – rather it is concerned with the insured member’s capacity to perform remunerative work for which the person is otherwise suited (meaning that the insurer does not have to prove there are jobs available to the insured member in their area of residence).
  • Depending on the wording of the TPD definition in the actual Policy, an insurer need not necessarily look at the insured member’s ability to obtain and maintain gainful employment, but rather their ability to perform the tasks of a particular role within their ETE.
  • Unsuccessful job applications are of ‘very limited utility’ in establishing TPD, as they may simply reflect general unemployment trends or a preference for a suitable alternative applicant.
  • Insurers can take into account the insured member’s sick leave and annual leave entitlements when considering the effect that the requirement for future regular treatment may have on the insured member’s ability to perform a role within their ETE.
Implications of the decision

Prior to Dorney QC DCJ’s judgment, it had been uncertain whether a Queensland Court would adopt the strict Date for Assessment approach noted above, which had been established as the result of a number of cases decided in New South Wales and Victorian Courts, or whether it would maintain a more fluid approach.

Given that the parties agreed to follow the New South Wales and Victorian approach to the Date for Assessment, the Court was not required to make any formal decision on this issue. However, the fact that Dorney QC DCJ did not question this approach may be thought to indicate some tacit approval for the adoption of the New South Wales and Victorian position, in Queensland.

The other notable points outlined above are otherwise favourable to defendants, and may assist both trustees and insurers in defending their decisions on claims, if challenged.

We understand, however, that the plaintiff has appealed this decision to the Queensland Court of Appeal, hence it remains to be seen whether that Court will support Dorney QC DCJ’s decision. Regardless of the outcome of the appeal proceedings, should the appeal proceed, it is likely to be the first Queensland Court of Appeal decision in a TPD matter in approximately fifteen years, potentially providing guidance in Queensland on a number of issues touching on the assessment and determination of TPD claims.

This article written by Nicholas Matkovich, Partner and Christopher Smith, Associate.

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