Tso Kuk Wan v. Lam Yuk Wah
|
DCCJ 4722/2008 IN THE DISTRICT COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION CIVIL ACTION NO. 4722 OF 2008 -------------------- BETWEEN
-------------------- Coram : Deputy District Judge Edward Shum in Court Dates of Hearing : 23rd & 24th November 2009 Date of handing down Judgment : 18th December 2009 JUDGMENT 1.By this action, the Plaintiff claims against the Defendant damages for making a false representation to her that since her gynaecological problem had already been resolved, there was no need for the Plaintiff to disclose the same in her application form (“the Application Form”) for medicine insurance with AXA China Region Insurance Company (Bermuda) Limited (“AXA”). 2.At the beginning of the trial, I sought to clarify with Mr. Fong, Counsel for the Plaintiff, the true basis of his client’s claim. Eventually, Mr. Fong was constrained to admit that his client’s claim should be made on the basis of the tort of deceit. Mr. Fong also confirmed that his client had never pleaded and therefore would not be relying on the claim relating to the Defendant’s failure to take reasonable skill and care in assisting the Plaintiff in filling out the Application Form. 3.I then enquired with Miss Ling, Counsel for the Defendant, who fairly agreed with me that the Plaintiff was not required to plead law. Miss Ling further accepted that the Statement of Claim did contain enough material facts (if found to be true) to support a cause of action in deceit. 4.The elements of the tort of deceit are neatly summarized in para.18-01 of Clerk & Lindsell on Torts (19th ed.) and I quote:-
5.Each aspect of this tort will be discussed in turn below. Meanwhile, I shall firstly set out the background facts. The Background 6.It is not in dispute that the Defendant was and still is working an insurance agent. The Plaintiff first came to know the Defendant through the introduction of the Plaintiff’s aunt, who in turn was and still is one of the Defendant’s clients. The Plaintiff’s husband also gave evidence and which was not seriously challenged by the Defendant that through the Defendant a number of his company staff had taken out various insurance policies with AXA in the past. 7.Sometime in or about August 2001, the Plaintiff took out a medical insurance policy with AXA through the Defendant. Thereafter, through the Defendant the Plaintiff also took out various medical and life insurance policies for and on behalf of her son with AXA. It is further common ground that all subsequent claims by the Plaintiff’s son for compensation under his medical insurance policy with AXA were handled by the Defendant. 8.It is pertinent to note at this juncture that although it is common ground that the Plaintiff had consulted one Dr. Wu Kwong Sum for vaginitis on 30th May 1998 and 15th July 1999, nothing was said about any of these consultations in either the application form submitted by the Plaintiff to AXA through the Defendant in August 2001 or in the Application Form here. 9.Meanwhile, sometime towards the end of June 2002, the Plaintiff was admitted to the Baptist Hospital for treatment of acute gastritis. The Plaintiff stayed in hospital for 3 days and incurred a total sum of $14,487 in medical expenses. Through the assistance of the Defendant, the Plaintiff was able to recover those medical expenses from AXA. 10.However, the Plaintiff decided not to renew her medical insurance with AXA upon its expiry in 2003. The Plaintiff said this was because her husband injured his back and incurred medical expenses of more than $200,000. And yet, he was only compensated for about $30,000 under his medical insurance with AXA. Her husband was very upset and told the Plaintiff not to renew her medical insurance policy with AXA. 11.There is conflicting evidence on who initiated the idea for the Plaintiff to reapply for medical insurance with AXA in 2005. Both parties agreed however that when the Plaintiff decided not to renew her medical insurance with AXA in 2003, the Defendant had already told her that in future AXA would be more cautious and might even require her to undergo medical examination before accepting her application for medical insurance. 12.With this background in mind, I shall look at the respective party’s case in turn. The Plaintiff’s case 13.The Plaintiff’s case is that at the time when the Application Form was filled out, she had clearly told the Defendant that she was found to have uterine fibroid during her annual gynaecological check up. The Defendant then asked the Plaintiff if the doctor had ever told her that the uterine fibroid was going to affect her health in future. The Plaintiff replied that the doctor had told her not to worry because many females also had similar condition to hers. Furthermore, the uterine fibroid would eventually resolve and this was not going to affect her health in future. Upon hearing that, the Defendant then told the Plaintiff that she did not have to mention this in the Application Form since this was not going to affect her health in future. 14.The Plaintiff also disagreed with Miss Ling’s suggestion that the Defendant had asked and she had replied to each of the questions listed in the Application Form. In re-examination, the Plaintiff further clarified that the Defendant had merely asked her about major illness and for this reason she did not mention to her anything about her consultations for vagnitis in 1998 and 1999 and cervicitis in 2003. 15.The Plaintiff was also cross-examined on the first draft of a letter of appeal to the Claims Department of AXA urging them to reconsider the Plaintiff’s claim for compensation. There is no dispute that this first draft was in the Defendant’s handwriting. But then again, the Plaintiff denied that it was written by the Defendant on the basis of information provided by her. In particular, the Plaintiff denied that it was she who mentioned in the first draft that she had forgotten about the incident relating to her uterine fibroid. 16.The Plaintiff’s husband further testified that the Chinese words in the first draft to the effect that the Plaintiff had forgotten about the incident relating to her uterine fibroid were deleted by him. And he said this was because the Plaintiff had already told the Defendant about this gynaecological problem when the Application Form was filled out in 2005. The Defendant’s case 17.The defence case is simply that the Plaintiff never told the Defendant that she had uterine fibroid in the past. The Defendant also denied having represented to the Plaintiff that there was no need to state in the Application Form any gynaecological problem that her doctor had said was not going to affect her health in future. 18.In her evidence in chief, the Defendant said that when the Plaintiff asked her in 2005 if it was possible for her to reapply for medical insurance with AXA, she had already told the Plaintiff that since the previous medical insurance was not renewed in 2003 and the Plaintiff had claimed for compensation in the past, AXA might ask her to undergo medical examination or might even refuse to provide insurance coverage for certain kinds of illness. 19.The Defendant also said in her evidence in chief that she had asked the Plaintiff each and every question listed in the Application Form. When being cross-examined, the Defendant further said that she had specifically reminded the Plaintiff to disclose all past illness. Or else, AXA might refuse to pay her compensation. Indeed, the Defendant went so far as to saying that even if the Plaintiff had already recovered from fever or influenza, she still needed to disclose the same in the Application Form. Evaluation of the evidence 20.Having heard their evidence and observed their demeanour when testifying, I have no hesitation in believing the Plaintiff and her husband but not the Defendant. 21.It is the Defendant’s case that the Plaintiff asked her in 2005 if it was possible for her to take out medical insurance with AXA again. But if the Defendant had actually reminded the Plaintiff to disclose all past illness, be it a minor influenza or fever and regardless of whether she had recovered from such illness, I wonder why the Plaintiff would merely mention in the Application Form her hospitalization for treatment of acute gastritis back in 2002 but not the more recent discovery of uterine fibroid. 22.In this connection, I place much weight on the Defendant’s evidence in court that it was the Plaintiff who volunteered the information on her hospitalization in 2002. As I have said, the Defendant’s case is that she had already told the Plaintiff that AXA might ask her to undergo medical examination or might even refuse to provide medical insurance coverage for certain kinds of illness. I fail to see why the Plaintiff had to be selective in making disclosure about her past illness. 23.One possible explanation is that the Plaintiff had forgotten about the incident relating to her uterine fibroid. But if this was the case, I wonder why the Plaintiff and her husband would delete this convenient excuse from the first draft of the letter of appeal to AXA. This is particularly true when the Defendant’s case, which I do not accept, is that the first draft was written by her on the basis of information provided by the Plaintiff. 24.I find that the Plaintiff had clearly told the Defendant that she was found to have uterine fibroid during her annual gynaecological checkup. I also find that the Defendant had misrepresented to the Plaintiff that she needed not mention this in the Application Form since this was not going to affect her health in future. 25.There can be no doubt that what the Defendant had told the Plaintiff was false. It is also clear from her evidence in court that the Defendant knew or ought to have known that the representation was untrue. Mr. Fong rightly referred me to para. 18-19 of Clerk & Lindsell on Torts (19th ed.) where the learned editors have this to say on the belief of the defendant and I quote:-
26.As the Defendant said in her evidence in chief, as an insurance agent, every time when she interviewed a client, she needed to ask the client her health condition. If she induced a client to take out medical insurance without so doing, she would be facing a dire consequence. In my view, this clearly shows that even if the Defendant did not know what she had told the Plaintiff was untrue, she would still be responsible for making the representation without caring whether it was true or false. 27.Given the fact that the Defendant had been acting as insurance agent for the Plaintiff since 2001 and the Plaintiff and her son relied heavily on the Defendant in handling their insurance matters, I have no hesitation in finding that the Defendant intended the Plaintiff to act in reliance of the false representation. 28.Inasmuch as the Plaintiff has suffered loss and damage as a result of AXA’s refusal to reimburse her medical expenses on ground of non-disclosure, I am satisfied on the evidence that the Defendant is liable to compensate the Plaintiff under the tort of deceit. 29.Miss Ling raises the point that AXA rescinded the medical insurance policy not only because of the Plaintiff’s non-disclosure of the incident relating to her uterine fibroid but also of her other gynaecological problems back in 1998, 1999 and 2003. 30.With respect, this argument is misconceived. As the learned editors of Clerk & Lindsell on Torts (op. cit.) aptly pointed out at footnote 33 on p. [1097]:-
31.Translating the legal principle into the facts of this case, the Plaintiff was given to understand by the Defendant that she needed not mention in the Application Form the uterine fibroid since this was not going to affect her health in future. It would only be reasonable for the Plaintiff to think that there was also no need to mention her gynaecological problems in 1998, 1999 and 2003 since none of them was going to affect her health in future. In any case, the Plaintiff’s evidence in re-examination, which I accept, was that the Defendant only asked her about major illness. Quantum of damages 32.It is clear from reading the terms and conditions of the medical insurance policy with AXA that the Plaintiff is entitled to reimbursement of expenses incurred everyday during hospitalization. It is equally clear from reading the receipt issued by Baptist Hospital that specialist doctor’s diagnosis fee was charged on a daily basis. Subject to my decision on these two points, the following items of claim have been agreed by the parties:-
33.Mr. Fong has to concede that the Plaintiff is not entitled to claim for either the insurance premium paid to AXA (which has already been refunded) or the outpatient doctor’s fee (which is not covered by the medical insurance). 34.I agree with Miss Ling’s submission that the Plaintiff is only entitled to recover from the Defendant the loss that she has actually suffered. With this in mind, I shall also allow the following items of claim:-
35.Also, Miss Ling fairly accepts that the Plaintiff is entitled to a cash allowance of $500 per day during hospitalization and I shall further award a sum of $3,500 as damages under this head. 36.Judgment is therefore given in favour of the Plaintiff against the Defendant for the sum of $51,500 together with interest at the rate of 8.2% per annum for the date of writ to the date of judgment and thereafter at judgment rate until payment. Costs 37.There is no reason why costs should not follow the event. I grant an order nisi that the Defendant do pay to the Plaintiff the costs of this action to be taxed if not agreed. There be certificate for counsel.
The Plaintiff : represented by Mr. Stephen Fong instructed by M/S. Wong, Kwan & Co., Solicitors The Defendant : represented by Ms. Vickie Ling instructed by M/S. Huen & Partners, Solicitors |