IN THE HIGH COURT OF FIJI AT SUVA
APPELLANT JURISDICTION

CIVIL APPEAL NO.: HBA 17 of 2013

BETWEEN:

DOMINION INSURANCE LTD
Defendant-Appellant

AND:

FIJI TEACHERS UNION
Plaintiff-Respondent

COUNSEL : Ms. S. Narayan for the Appellant.
Mr. S. Chandra for the Respondent. 

Date of Hearing : 28th June, 2015
Date of Judgment : 6th November, 2015 

JUDGMENT

[1] The plaintiff-respondent (hereinafter referred to as the plaintiff) entered into a health insurance agreement whereby the defendant-appellant (hereinafter referred to as the defendant) agreed to indemnify the medical expenses of the members of the plaintiff union. 

[2] Chandrika Prasad (hereinafter referred to as the insured) one of the members of the plaintiff union fell ill and had to go to Australia for a heart surgery. The insured attempted to obtain consent of the defendant to go to Australia for the surgery but failed. Since he had to undergo the surgery immediately the insured went to Australia and later made his claim which was repudiated by the defendant.

[3] The plaintiff instituted action in the Magistrate's Court claiming $ 15,000.00, as damages under the Fair Trading Decree, General Damages, Interest and costs of the action on indemnity basis.

[4] The learned Magistrate who heard the case left the Judiciary without delivering the judgment and the learned Magistrate who delivered the judgment was entrusted with that task.

[5] The learned Magistrate in her judgment dated 29th July 2013 ordered the defendant to pay the plaintiff a sum of $ 15,000.00 with interest at the rate of 10.5% from the date of the judgment until the entire sum awarded is paid in full.

[6] Being aggrieved by the judgment of the learned Magistrate the defendant preferred this appeal on the following grounds:

1.	The learned Magistrate erred in law and in fact in deciding that the defendant did not comply with the terms and conditions of the medical insurance policy on overseas evacuation where there was sufficient evidence that the terms and conditions of the insurance policy required the plaintiff to be examined by the defendant's doctors for the second opinion which the insured did not allow.

2.	The learned Magistrate erred in law and in fact in deciding that the medical insurance policy on overseas evacuation covered countries like Australia and New Zealand when plaintiff had a standard insurance policy which states overseas evacuation procedures and country for treatment was only Batra Hospital, India.

3.	The learned Magistrate erred in law and in fact in deciding that the appellant failed to evaluate the plaintiff's request for overseas treatment and refused to send the respondent for treatment in an emergency situation when there were sufficient evidence that the respondent made his own arrangements to travel to Australia on 3rd April 2008 and received treatment on 8th April 2008 without obtaining prior approval for overseas treatment and which country the treatment will be done as per the insurance policy, which the plaintiff failed to do. 

4.	The learned Magistrate erred in law and in fact in deciding that the defendant is in breach of section 54 of Fair Trading Decree 1992 when there was sufficient evidence that the applicant had to comply with the terms and conditions of insurance policy and cannot at any time act outside the insurance policy.

5.	The learned Magistrate erred in law and in fact in deciding that the plaintiff was not advised of the exclusion clauses before accepting the premium when there was sufficient evidence that the terms and conditions of the insurance policy was agreed to by the respondent before insurance premiums were paid by its members and the signed policy document were issued to the respondent on 14th February 2005.

6.	The learned Magistrate erred in law in awarding $ 15,000.00 to the plaintiff without taking into account the terms and conditions of the insurance policy and what were the effects of the said terms and how and when they can be breached.

7.	The learned Magistrate erred in law in awarding 10.5% interest from the date of the judgment until the entire sum is paid in full when the Magistrate's Court Rules state that the Magistrate's Court can award interest at 5% per annum as the jurisdiction is limited to $ 50,000.00.

[7] The learned Magistrate found that the defendant was in violation of the provisions of section 54 of the Fair trading decree when it failed to explain the exclusion clauses of the insurance agreement to the insured before accepting the insurance premium. 

Section 54 of the Fair Trading Decree provides as follows;

(1)	A person shall not, in trade or commerce engage in conduct that is misleading or deceptive or is likely to mislead or deceive.

(2)	Nothing in this Division shall be taken as limiting by implication the generality of subsection (1).

[8] The insurance policy in question is not an individual policy but a group insurance policy. The plaintiff entered into this insurance agreement with the defendant on behalf of its members. When an agreement is entered into both the parties are expected to read and understand its terms and conditions before subscribing their signatures to it unless the parties are illiterate persons. In the instance case the insureds are all teachers and it is their association which represented the entire membership when this insurance agreement was entered into. Therefore, there was no requirement for the defendant to read and explain the terms and conditions of the agreement to each and every member of the plaintiff association. 

[9] In terms of the contract of insurance the overseas medical evacuation benefits must be recommended and certified by a medical practitioner stating that an insured person needs treatment and a specialist appointed for the purpose by Dominion Insurance must recommend such treatment. It is also provided for in the agreement that the insured may make his own arrangement for the appropriate evacuation overseas after having obtained prior approval from the insurer. 

[10] It is clear that the overseas medical evacuation could be done only with the prior approval of the insurer. In this case the insured had brought to the notice of the insurer his medical condition and submitted an angiogram report to substantiate his position. The officer who received the documents from the insured had informed him that it would take two to three weeks to obtain the approval. The learned Magistrate concluded that this implied that the insured would be granted approval had he waited for two to three weeks but since he was unable to wait for that long due the urgency of the matter arrangements were made for him to go to Australia. The statement of the officer of the insurance company to the effect that it would take two to three weeks to process the request for overseas medical evacuation did not have the effect of granting permission and the contract of insurance did not provide for such a course.

[11] However, it is important at this stage to consider whether the practice adopted by the defendant to take a long time like in this case is fair by the insured. There are illnesses that can wait for weeks but in the instant case the insured had to undergo a surgery without any delay. Although it is not provided for in the insurance agreement there are instances where the insurer has to act fast and make necessary provisions for the insured to obtain medical facilities without any delay. 

[12] In the business of insurance the insured has hardly any say in preparing or suggesting the terms and conditions of the insurance agreement although it is a contract between the parties and also that in every contract consensus ad idem or meeting of minds has to be an essential ingredient. It is the insurer who decides as to what facilities the insured is entitled to on the contract and when he becomes entitled to receive such facilities. I am mindful of the fact that insurance is a business and the insurer will always attempt to get the maximum profit out any contract of insurance they enter into. However, the insurer has a duty to see that the insured gets the maximum facilities without any delay when he or she is really in need. The contract of insurance in question does not make provisions for a period of time within which the insured must grant permission for overseas medical evacuation. In this instant the defendant has not acted reasonably by setting a time period of two to three weeks to consider whether the approval for overseas medical evacuation could be granted. 

[13] Section 54 of the Fair Trading Decree prohibits anyone from engaging in any business which is deceptive or misleading or is likely to mislead or deceive. The contract of insurance sued upon does not contain any clause which is misleading. The Plaintiff or the insured who is a member of the plaintiff society, has not brought to the notice of the Court any such clause nor have the plaintiff say that it was misled by the defendant to enter into this agreement. On a careful consideration of the terms of the contract of insurance it appears that some of the terms are not favourable to the insured. However, the parties at the time of entering into this contract agreed to these terms and conditions. 

[14] Another ground of appeal is that the insured left for medical treatment before the defendant obtained a second opinion from its own doctor. There is no evidence in that regard on record and there is also no evidence that the insured refused to subject himself for examination by another doctor. However, the defendant had taken its own time to make these arrangements which made the insured to leave for treatment without prior approval. 

[15] Another ground of appeal is that the plaintiff has obtained treatment from a hospital which was not approved by the defendant. According to the contract of insurance "preferred hospital" means a hospital which an insured person is directed by Dominion Insurance for treatment of a disability. 

[16] Under the heading POLICY COVERAGE in section 1 of the contract it is provided that overseas medical evacuation benefit must be recommended and certified first by a medical practitioner stating that an insured person needs treatment, second, a specialist appointed for the purpose by Dominion Insurance must recommend such treatment. 

[17] It also provides that subject paragraphs (ii) or (iii), which limit the claim to $ 30,000, the insured may make his own arrangement for the appropriate evacuation overseas after having obtained prior approval from Dominion Insurance Limited for a course of treatment in a hospital other than a preferred hospital. 

[18] Any of these conditions to become operative the defendant must indicate whether it would grant approval and in this case as I have already stated the defendant has taken comparatively a long time to process the application of the insured which in not reasonable. However, the parties cannot deviate from the terms of the contract of insurance entered into between them. 

[19] It was argued that the learned Magistrate erred in ordering the defendant to pay interest at the rate of 10.5% per annum on the sum awarded since the rate of interest that could be awarded by the Magistrate's Court is only 5%. The learned Magistrate in her judgment has not stated the basis on which this amount of interest was awarded. 

[20] For the reasons aforesaid I make the following orders.

ORDERS.

1.	The appeal of the defendant-appellant is allowed.

2.	The judgment of the learned Magistrate is set aside. 

3.	The claim of the plaintiff is dismissed.

4.	Taking all the circumstances of this case into consideration I make no order for costs of this appeal. 

Lyone Seneviratne
JUDGE

06.11.2015