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Chandra v Fiji Care Insurance Ltd [2004] FJHC 311; HBC0220.1999 (23 September 2004)

IN THE HIGH COURT OF FIJI
AT LAUTOKA
CIVIL JURISDICTION

Action No. HBC0220 of 1999L

Between:

SUNILA DEVI CHANDRA
Plaintiff

-v-

FIJI CARE INSURANCE LTD.
Defendant

Mr. V.P. Mishra Counsel for the Plaintiff
Mr. D. Prasad Counsel for the Defendant

Date of Hearing: 5th, 17th August 2004
Date of Judgment: 23rd September 2004

JUDGMENT

Background

The plaintiff’s claim is based on an Insurance policy for health cover for herself. The plaintiff was at the material time a school teacher and a member of Fiji Teachers Union which had taken out what in Fiji is called a group insurance policy. The plaintiff suffered from a spinal tumour and was first admitted to Lautoka Hospital and then evacuated to a hospital in Australia where she was treated. On her return she claimed for expenses she had incurred but it was declined on the basis that such treatment was available in Fiji and therefore she was not entitled to compensation under the terms of the policy and that she had not been assessed by designated medical practitioner of the defendant prior to evacuation as required by the policy.

Certain facts have been agreed to by the parties. These are set out in the minutes of pretrial conference as follows:

Agreed Facts

1. The Plaintiff is a qualified school teacher.

2. There is an insurance health cover policy being Policy No. 0455FU which the Fiji Teachers Union is registered as the assessed. (“The Policy Contract”)

3. Sunila Devi Chandra is a contributing member to the Fiji Teachers Union

4. The Plaintiff became critically ill and was admitted at Lautoka Hospital. She was diagnosed as having spinal tumour causing progressive paraplegia.

5. The Plaintiff was seen and assessed by Doctor J Mareko who confirmed urgent treatment to Australia.

6. The Plaintiff was evacuated to Australia and treated at Dalcross Hospital on 22 October, 1998.

7. The Plaintiff has supplied invoices and/or receipts to the Defendant amounting to $32,150.47 (thirty two thousand one hundred and fifty dollars and forty seven cents) and has demanded payment of the same by the Defendant

8. The Defendant has refused to pay the said sum of $32,150.47 (thirty two thousand one hundred fifty dollars and forty seven cents only).

Evidence

The plaintiff called three witnesses including herself. PW1 Sunila Chandra is the plaintiff who now lives in Hamilton New Zealand. She stated that she had an operation for spinal tumour at Dalcross Hospital in Australia on 24th October 1998. Prior to that she had been admitted to Lautoka Hospital for 35 days. She had been in pain for two years. She said she had seen over the period of two years virtually all the doctors at Lautoka Hospital including Doctor McCaig who examined her and had her X-rayed some time in 1996. He had examined her for the same pain for which she was operated.

While admitted for 35 days, she was attended to by Doctor Mareko and a visiting orthopaedic surgeon from Newcastle one Doctor Kleinman. After myelogram tests she lost control of her bladder. On recommendation of Doctor Mareko she was evacuated to Australia. Doctor Mareko had issued a report to her.

From her myelogram results, she was told that a blockage was causing all the problems. She was accompanied by her husband and a doctor to Australia.

In cross-examination she stated that Doctor Mareko had not examined her prior to her admission. She had the policy during the two years she suffered but she did not report to the insurance company. When she was admitted to hospital, her husband applied to the defendant for treatment overseas. She stated that she had not seen the policy as it was a group policy and kept by the Fiji Teachers Union.

To a question by court she said that she was not told who the designated doctors of Fiji Care Insurance were.

PW2 Doctor Joeli Mareko is a Consultant Orthopaedic Surgeon. He has practiced as a doctor since 1983. He had attended to the plaintiff while she was admitted to Lautoka Hospital for 35 days. He prepared two medical reports on her after consulting Doctor Leon Kleinman. Doctor Mareko did clinical examination. He had X-rays done which did not show anything. A myelogram was done on her. He described myelogram as a system of injecting opaque substance within the space in spinal cord. The myelogram showed a substantial blockage but he could not delineate the upper limit towards neck and head. He could not say what caused the blockage. There was a compression of spinal cord. A CT scan was arranged and done in Suva. The report of CT scan said result was not convincing as to what the problem was. The patient had lost control over bladder and bowel. He considered operating on her as highly risky because complications could have arisen and even resulted in damage to spine. If spinal column was damaged, she could become paraplegic.

He consulted Doctor Kleinman who was highly qualified and with wide experience and he suggested evacuation overseas. Doctor Kleinman suggested MR1 which was not available in Fiji and for a neurosurgeon to look at her. There are no neurosurgeons in Fiji.

She was evacuated to Australia where a Neurologist Doctor Sears saw her and treated her. He prepared a report as to what was done. According to the report the tumour had affected the covering of spinal cord and the bone as well so the bone texture was not normal. MR1 was done on her.

The treatment given was laminectomy by opening the vertebra more to the left, and it revealed that it was a highly vascular tumour involving a lot of blood vessels. Both microsurgery and macrosurgery were done on her. Microsurgery of spine according to Doctor Mareko cannot be done in Fiji as firstly because there are no neurosurgeons in Fiji and secondly because such surgery requires special microscope not available in Fiji.

Having looked at Doctor Scars report the witness was of the view that they could not have obtained such detailed investigation in Fiji and would not be able to find who the enemy was and they would be operating blindly.

He said he got no record of him agreeing with Doctor Rosemary Mitchell that surgery could be done in Fiji or telling her that the patient did not want operation done in Fiji. He agreed he is not a Fiji Care designated doctor.

In cross examination he stated that he came to Lautoka Hospital in 1998. He considered Doctor Eddie McCaig a good surgeon. Spinal cord decompression surgery has been done in Fiji and he had done it in real emergency. He did not discuss the patient with Doctor McCaig but only with Dr Piscioneri who wanted a second CT scan done on her.

PW3 Basant Lal Chandra is the husband of the plaintiff. His evidence does not add much to whatever was said by his wife and Doctor Mareko. He had seen report of 9th October 1998 prepared by Dr. Mareko. Before 9th October he had spoken to Doctor Mareko. The doctor did not tell him that such operation could be done in Fiji.

In cross-examination he said he had written letters to Fiji Teachers Union (FTU) regarding this matter. FTU did not tell him that such treatment was available in Fiji.

Factual Analysis

The basis of the claim is the Group Health Insurance Policy. The plaintiff tendered two different statements Exs. 1A & 1B to the policy. The commencement date in Exhibit 1A is 6th February 1999 and the termination date is 6th February 2000. The commencement date on Exhibit 1B is 6th February 1998. The events in the present case occurred in October & November 1998 so Ex. 1B is the one applicable to this case. The relevant provision is in schedule 2 under the Heading OVERSEAS MEDICAL ASSOCIATION. The relevant words are:

“where the FIL designated Medical Practitioner advises that an insured person needs Treatment which is not available in Fiji, FIL will pay”_ _

and then there follows a number of costs which would be paid.

It is agreed that Doctor Joeli Mareko was not a FIL designated medical practitioner. The existence of overseas medical evacuation clause is a recognition of the limits of medical facilities available locally. There are certain medical facilities available as a routine in other countries but not available in Fiji. To cover up or compensate for this unavailability or vacuum in these medical facilities, some people in Fiji take out health policies with overseas evacuation for medical treatment as part of the policy. As evacuation is necessary in cases of emergency, one would expect that utmost speed and urgency would be shown in such cases.

In Frank R Eggers Junior v Blueshield (Pacific) Insurance Ltd. HBC0094 of 1997 Justice Gates summed up the essence of such policy at page 22 as follows:

“A medical evacuation policy is bought in order to purchase peace of mind. A customer is worried about obtaining quality medical procedures and operations speedily. He seeks swift remedies if urgent medical problems were to arise”.

Who the designated medical practitioners were would be within the peculiar knowledge of the defendant. Whether the names of those practitioners were deleted from time to time or more added to the list is not known. There is hardly any purpose served if the beneficiaries of the health policy who were required to seek advice from specified medical practitioners did not know who they were or where to contact them. The names, addresses and phone contact of these practitioners should be made available in advance to the assured rather than the assured when faced with an emergency having to rely on the defendant for such names. People in emergency panic and have no time to start reading policies. Emergencies can arise anytime during public holidays or at night when Defendant’s office are not open. Advance notice of names of such practitioners would be prerequisite if this clause was to effectively put into practice the promises made. The onus would be on the defendant to provide the names and addresses.

Doctor Joeli Mareko says he was not a designated doctor. The issue is really whether the plaintiff knew he was not. There is no evidence to suggest that Fiji Care told the plaintiff that Doctor Joeli Mareko was not designated doctor but somebody else was. The defendant was aware that the plaintiff was admitted in Lautoka Hospital and yet it made no effort to send its designated doctor to Lautoka to see her. Surely it would be far easier to send their doctor to the hospital than to have this very sick person transferred to Suva. Such designated doctor would then have been able to discuss the patient with Doctor Mareko, and examine her records. Only then could the designated doctor make an informal decision. That did not happen and now the defendant is raising the issue of availability of such treatment in Fiji. It is asserting that the treatment was available in Fiji. It must prove it.

Availability of Treatment in Fiji

The defendant in its defence says the treatment accorded to the plaintiff in Sydney namely laminectomy and removal of benign tumour was available in Fiji and that Doctor Piscioneri would have carried out the necessary operation. The defendant in its submission submitted that the plaintiff failed to avail herself of treatment which was available locally. Therefore she is in breach of the policy and she ought not to be compensated.

On the evidence available the plaintiff had gone through a number of doctors before her admission to Lautoka Hospital. On admission it was Doctor Mareko who examined her, had X-rays, myelogram and CT scan done on her. He had conducted whatever tests were available in Fiji. He came to a certain conclusion after myelogram was conducted. He was not sure of the upper extremity of the blockage. He was not prepared to risk, or take a sort of stab in the dark which could end up in complications later such as plaintiff becoming a paraplegic. Doctor Mareko had the additional advantage of obtaining a second opinion from Doctor Kleinman who had outstanding credentials and whose experience was second to none in Fiji.

His recommendations for overseas treatment had sound foundation. One of the procedures recommended was MR1 which was not available locally. Doctor Kleinman also felt that the plaintiff needed to be examined and treated by a neurosurgeon. There are no neurologists in Fiji. Simply because Doctor Piscioneri was prepared to operate on the plaintiff does not by itself mean the treatment was available in Fiji. Treatment means effective treatment with some degree of success. For that to happen the necessary first steps to effective diagnosis must be available. In the present case MR1 was not available and it is also clear from evidence that the nature of the malady required the intervention of a neurosurgeon which Dr. Piscioneri was not.

Doctor Mareko was aware that Doctor Piscioneri suggested treatment locally. Doctor Piscioneri had not examined her. Doctor Mareko explained that his duty was to the patient and to ensure that she became a productive citizen again.

Exhibit 5 is the report by Neurosurgeon who attended to her. It explains the complications which were found on the plaintiff. It shows that a MR1 was done on her and which revealed the exact location of a tumour and what operations were conducted on her. This report only fortifies the fears of Doctor Mareko and his conclusion that the treatment was not available in Fiji. I agree with Doctor Mareko’s conclusion that considering the circumstances of plaintiff’s disease the treatment was not available in Fiji. The plaintiff therefore I conclude cannot avail itself of the assertion that the treatment was available locally.

Estoppel

Mr. Mishra submitted that letters written by the defendant company created an estoppel. He referred to letters dated 21st October 1998 and dated 13th November 1998 being plaintiff’s Exhibit 6 and 7. These letters do not unequivocally undertake to pay but both say that costs will be paid in accordance with the terms of policy. There is a condition attached. Compliance with terms of policy is a prerequisite to payment according to these letters. Accordingly estoppel does not apply.

Treatment Costs etc. Overseas

It is agreed by the parties that the plaintiff had supplied invoices and/or receipts amounting to $32,150.47. I believe these figures are in Fijian dollars. What the various invoices are for is not known but in view of the maximum limits provided in New Zealand dollars and the exchange rate between the NZ currency and Fijian currency (roughly 0.84) I can safely award judgment for this.

Mental Stress

Mr. Mishra in his final submissions laboured at length for general damages for pain and suffering for two weeks and also for mental stress. He relied on Eggers case. As such I shall address this matter at a greater detail then I thought I need to.

Generally speaking a person in breach of contract is not liable for pain and suffering and distress for such breach caused to the innocent party. In Watts v Morrow [1991] EWCA Civ 9; (1991) 4 All ER 937 at 959 Bingham LJ noted:

“A contract-breaker is not in general liable for any distress, frustration, anxiety, displeasure, vexation, tension or aggravation which his breach of contract may cause to the innocent party. This rule is not, I think, founded on the assumption that such reactions are not foreseeable, which they surely are or may be, but on considerations of policy.

But the rule is not absolute. Where the very object of a contract is to provide pleasure, relaxation, peace of mind or freedom from molestation, damages will be awarded if the fruit of the contract is not provided or if the contrary result is procured instead. If the law did not cater for this exceptional category of case it would be detective.”

In Farley v Skinner [2001] UKHL 49; 2001 4 All ER 801 the House of Lords also considered damages for non financial loss arising out of breach of contract. At page 812 speaking of the “exceptional category” cases Lord Steyn observed

“There is no reason in principle or policy why the scope of recovery in the exceptional category should depend on the object of the contract as ascertained from all its contractual parts. It is sufficient if a major or important object of the contract is to give pleasure, relaxation or peace of mind”.

Considering the above cases and Eggers I am of the view that damages for mental stress in breach of contract can be awarded in a proper case or this exceptional category cases. However because this is exceptional category pleadings would need to be quite explicit. Further Lord Steyn gave a salutary warning that “awards in this area should be restrained and modest” and should not “contribute to the creation of a society bent on litigation”.

The plaintiff’s claim makes no reference to any pain and suffering or mental stress being suffered by the plaintiff. In her prayer she is asking for damages which in the context of the statement of claim would refer to damages for breach of contract. Further I looked at minutes of pre trial conference which again made no reference to damages for pain and suffering and mental stress as an issue for the trial. Besides the plaintiff herself gave no evidence of mental stress. In Eggers damages for pain and suffering and for mental stress were allowed because they were referred to in the pleadings. Eggers was further a case where the insurance company delayed his evacuation resulting as prolonging his pain and stress. I would expect a more thorough allegations in the statement of claim than a bare word ‘damages’ in prayer. A defendant is entitled to know what is the nature of damages sought so he/she is prepared to counter them. I cannot allow damages for pain and suffering and mental stress.

However there is little doubt that the defendant was in breach of contract. I allow damages for breach of contract in the sum of $1,000.00.

Interest

The plaintiff had been locked out of these funds. Some interest must be awarded to her. Accordingly I allow her interest at 6% per annum from 23rd June 1999 (date of filing of writ) to present under Law Reform (Miscellaneous Provisions) (Death and Interest) Act Cap 27.

Accordingly I award the following sums:

I enter judgment for the sum of $41,348.73 together with cost in the sum of $4,000.00 as the plaintiff and her witness had to travel from New Zealand.

[Jiten Singh]
Judge

AT Lautoka this 23rd day of September 2004.