the republic of trinidad and tobago in the...

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THE REPUBLIC OF TRINIDAD AND TOBAGO

IN THE HIGH COURT OF JUSTICE

CV No. 2012 - 03492

Between

RIAN MOYOU

Claimant

And

MEDISERV INTERNATIONAL

Defendant

BEFORE THE HONOURABLE MR. JUSTICE ANDRÉ DES VIGNES

Appearances:

Mr. Kenneth Sagar instructed by Mr. Derrick R. Sankar for the Claimant

Mr. Saeed Trotter for the Defendant

JUDGMENT

INTRODUCTION

1. The Claimant alleges that on 25th August 2004 he entered into a Mediserv Medical Fund

Contract with the Defendant for the provision of medical insurance coverage for himself and

three members of his family. In or about October 2007, the Claimant was diagnosed with

carcinoma of the stomach. In 2008, the Claimant submitted several claims for medical

expenses incurred by him for the treatment of his condition but the Defendant repeatedly

refused to reimburse him. Accordingly, the Claimant claims damages for breach of contract

and reimbursement of the cost of his medical expenses in the sum of $131,379.06, interest and

costs.

2. The Defendant denies that it agreed to provide medical insurance to the Claimant and his

family members and contends that, in accordance with the terms of the applicable Contract,

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the Claimant is not entitled to be reimbursed for his expenses as: (a) his illness was a pre-

existing condition which was excluded from coverage under the Contract; (b) his illness was

associated with or related to his past tobacco use which was also excluded under the Contract;

and (c) he misrepresented his smoking history on his claims. Accordingly, the Defendant

counterclaims for a declaration that it is discharged from liability in respect of the Claimant’s

alleged loss.

THE CLAIM

3. By Claim Form and Statement of Case filed on 24th August, 2012, the Claimant alleged as

follows:

a. On 25th August, 2004, the Claimant entered into a Mediserv Medical Fund Contract

(“the Original Contract”) with the Defendant for the provision of medical insurance

coverage for himself and three family members and was assigned Account No. 301540

under Plan Code CF110;

b. In or about October 2007, the Claimant was diagnosed with carcinoma of the stomach

and incurred the following medical expenses amounting to $131,379.06:

i. 3rd March, 2008 - Cancer test costing $2,955.00;

ii. 4th April, 2008 - Surgery and hospital bill costing $110,113.00;

iii. 3rd July, 2008 - Test costing $2,955.00;

iv. 7th September, 2008 - Cancer Test, Pathology Report and Blood Test costing

$2,900.00;

v. 8th November, 2008 - Test and Chemotherapy costing $12,456.06

c. Pursuant to the Original Contract, the Claimant submitted claims to the Defendant for

reimbursement of his medical expenses but the Defendant, by several letters from its

Claims Examiner II, Ms. Anna R. Bahadur, denied liability. By letters dated 27th May,

2008, 11th September, 2008 and 20th October, 2008, Ms. Bahadur indicated, inter alia,

that the Claimant was ineligible for reimbursement on the grounds that:

i. he failed to consume the necessary incubation period; and

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ii. his medical condition was outside the scope of the contract as it was associated

with the use of tobacco products.

d. By letter dated 16th July, 2008, the Claimant’s Attorney-at-Law wrote to Ms. Bahadur

to indicate, inter alia, that the medical reports of Dr. Kavi Capildeo and Dr. Denaesh

Ariyanayagam dated 12th June, 2008 and 25th June, 2008 respectively, outlined that the

Claimant’s symptoms in October 2007 appeared to be unrelated to any cancer-related

symptoms in 2006. Dr. Ariyanayagam’s report also indicated that there was no

incubation period documented for his medical condition and that the denial of the

Claimant’s claim on that basis was medically unjustifiable. Further, he stated that the

Claimant’s consumption of tobacco approximately 20 years ago did not contribute to

his illness;

e. The Claimant sought another medical opinion from Dr. Anesa Ahamad and, by letter

dated 8th July, 2008, Dr. Ahamad stated, inter alia, that it was unlikely that the

Claimant’s epigastric pain in 2006 was related to the diagnosis of gastric

adenocarcinoma; and

f. By failing to reimburse the Claimant for his medical expenses, the Defendant is in

breach of contract, in particular, Clauses 2A-2-1(7), 33, 47, 71 and 78 thereof.

DEFENCE AND COUNTERCLAIM

4. By Defence and Counterclaim filed on 16th November, 2012, the Defendant contended as

follows:

a. The Defendant did not enter into a contract for the provision of medical insurance

coverage for the Claimant and/or three of his family members. The Defendant is a

Friendly Society (pursuant to Section 5(1)(a) of the Friendly Societies Act, Chapter

32:50) and not an insurance company and is not authorized to and does not conduct

business as an insurance company;

b. The Claimant and the Defendant are members of a society named or styled the Ventures

and Investments Programme (“VIP”), with the Defendant being the Trustee of the Fund

established under a Mediserv Medical Plan (“the Plan”) for the benefit of the members

of the VIP. The Defendant is a risk management company which provides medical

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assistance and risk management services to the VIP and the Fund and the Plan are

managed and regulated in accordance with the Original Contract;

c. As a member of the VIP and together with the Defendant and other members, the

Claimant agreed for the Defendant, as trustee, to manage the Plan and the Fund in

accordance with the terms of the Original Contract. The VIP members contributed to

the Fund and the Defendant was authorized to set rules and terms and conditions for its

operation with the objective of protecting the viability of the Plan and the Fund;

d. By the terms of the Original Contract, the Claimant agreed to accept the rules of

conduct and conditions set by the Plan Administrator and the Defendant was permitted

to add, vary or delete any terms and conditions of the Original Contract at any time

without notice;

e. The Original Contract was revised in 2007 and replaced by Contract Version No.

PMC20070301 (“the Revised Contract”) which became effective on 1st March, 2007.

By letter dated 19th January, 2007, the Defendant notified the Claimant that the

Defendant intended to review the Original Contract. Prior to the Claimant’s anniversary

date of 1st October, 2007, his contract was renewed under the terms of the Revised

Contract. Accordingly, at all material times in 2008, the Revised Contract was the

applicable contract;

f. The Defendant is not bound by the terms and conditions of the Original Contract since

this was amended and/or altered and/or superseded by the Revised Contract. In any

event, the Claimant placed reliance on certain clauses in the Revised Contract in

support of his allegations of breach of contract by the Defendant;

g. The Defendant does not admit or deny the cost of the Claimant’s medical expenses and

puts him to strict proof thereof. In any event, even if the expenses incurred by the

Claimant were eligible for reimbursement under the Plan, the Plan does not provide

100% coverage for expenses incurred and any entitlement would be subject to the

schedule, rules and controls as set out in the Revised Contract and in particular, the

Summary of Benefits;

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h. The Defendant denies the assertions, findings, conclusions and opinions outlined in the

medical reports of Dr. Capildeo and Dr. Ariyanayagam. Further, the meaning of

“Incubation Period” as used in the practice of medicine carries a different meaning

from the meaning intended in the Revised Contract. “Incubation Period” as used in the

Revised Contract is an observation period used to determine whether any specific risks

are to be accepted within the Plan;

i. The Claimant was a past tobacco user and under the general exclusion clause of the

Revised Contract, (Clause 2A-4-4), all risks associated with tobacco or with tobacco

use are absolutely excluded. Accordingly, the Claimant’s admitted use of tobacco in

the past was a risk factor to his cancer, which is a risk excluded according to the

Incubation Period for carcinoma;

j. The findings of Dr. Ahamad do not affect the Defendant’s right to determine that the

Claimant’s illness is related to a risk absolutely excluded from the Plan;

k. When the Claimant made the claim for epigastric pain in 2008, the Claimant disclosed

that he had presented symptoms of epigastric pain in March 2006, a date within twenty

four months of the commencement date under the Plan on 1st October 2004.

Accordingly, the Defendant is entitled to treat the Claimant’s epigastric pain as a pre-

existing condition, which was an excluded risk under the Revised Contract. Further,

the Claimant failed to provide a medical certificate that he was cured of the pre-existing

epigastric pain, as required under Clause 2A-2-1(10) of the Revised Contract and the

Defendant is entitled to treat the 2008 diagnosis as a continuing illness;

l. None of the doctors relied upon by the Claimant expressed the underlying cause of the

Claimant’s condition and the Defendant was entitled to rely on Clause D of the Table

of Incubation Periods which provided that the Defendant is entitled to determine which

class the illness shall be listed within in the Table of Incubation Periods;

m. The Defendant is not in breach of contract for failing to reimburse the Claimant for

monies expended by him as the Claimant was not eligible for reimbursement for any

treatment, services and expenses related to or arising out of, directly or indirectly from

tobacco use as well as pre-existing conditions;

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n. The Claimant submitted medical claim forms seeking reimbursement for medical

expenses in which he either failed to indicate whether he had ever used tobacco or

tobacco products or indicated that he had never used tobacco or tobacco products. In

these forms, the Claimant certified that the answers therein were true and correct and

accepted that to omit and misrepresent any material fact would constitute a breach of

contract. However, by letter dated 1st April, 2008, the Claimant admitted that he had

used tobacco or tobacco products during “his twenties”;

o. The Defendant denies that when the Claimant applied to join the Plan he indicated that

he smoked during his twenties or that he did tests in relation to tobacco use, the results

of which were acceptable to the Defendant;

p. The Claimant’s use of tobacco does not and did not exclude him from the Plan but the

Revised Contract excludes coverage for illnesses related to tobacco use; and

q. Section 2A-4-7 of the Revised Contract provides that no legal action may be brought

to recover under the Plan if after one year of the occurrence of the loss, no written

notice of intended legal action has been given.

THE REPLY AND DEFENCE TO COUNTERCLAIM

5. By Reply and Defence to Counterclaim filed on 22 February, 2013, the Claimant contended

that:

a. He neither admits nor denies that he was assigned as a member of VIP and put the

Defendant to strict proof thereof;

b. The Defendant is a duly registered as a limited liability company under the laws of

Trinidad and Tobago and is not a Friendly Society as alleged;

c. He did not receive from the Defendant any notice of intention to review the Original

Contract and he did not renew his coverage under the Revised Contract;

d. The meaning and purport of the term Incubation Period is as stated in Dr. Capildeo’s

medical report as well as Paragraph K of the Original Contract and Page 5/Section 33

of the Revised Contract, all of which bear the same meaning;

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e. In completion of his application form to join the Plan, the Claimant disclosed his past

tobacco use which had stopped 29 years before. Consequently, the Defendant arranged

for its doctor to conduct tests on him and thereafter he was permitted to enter into the

contract with the Defendant;

f. His smoking some 29 years ago did not cause his medical condition. As a result, the

Defendant is liable as his claim falls outside of Clause 78; and

g. Some of the medical claim forms which he submitted for reimbursement contained a

clause asking whether he ever used tobacco or tobacco products but he did not omit or

misrepresent any material fact or breach the contract. The medical claim forms do not

form the basis of the contract and in no way affected the mind of the Defendant in

accepting the risk.

ISSUES

6. The following issues arise for determination in this matter:

a. Is the Defendant an Insurance Company or a Friendly Society?

b. Was the Claimant a member of the VIP?

c. What was the applicable contract as at the date of the Claimant’s claims - the Original

Contract or the Revised Contract?

d. Is the Claimant barred from bringing this action as a consequence of his failure to give

written notice of intended legal action?

e. Did the Defendant breach the contract by its refusal to reimburse the Claimant for his

medical expenses on the grounds that:

i. The Claimant failed to indicate in his claim forms whether he had used tobacco

or tobacco products or indicated that he had never used tobacco or tobacco

products?

ii. The Claimant’s epigastric pain was an excluded risk under the Pre-Existing

Condition clause, since the symptoms thereof presented themselves in March

2006 during the incubation period set out in the Revised Contract. Further, in

the absence of a medical certificate certifying that the epigastric pain symptoms

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in 2006 had been cured, the Defendant was entitled to treat the Claimant’s

diagnosis of carcinoma of the stomach in 2008 as a continuing illness?

iii. The Claimant’s past use of tobacco was an excluded risk under the terms of the

contract?

f. Is the Claimant entitled to the relief sought? If not, is the Defendant entitled to be

discharged from liability under the Plan?

DISPOSITION

7. For the reasons hereinafter set out, I am of the opinion and so find that the Claimant is entitled

to succeed in his claim for reimbursement of his expenses in the amount of $128,404.06 and

that the Defendant’s Counterclaim should be dismissed. I also find that the Claimant is entitled

to interest on the sum of $113,048.00 at the rate of 2.5% per annum from 27th May, 2008 to

the date of judgment herein and on the sum of $15,356.06 at the rate of 2.5% per annum from

11th September, 2008 to the date of judgment herein. I also order the Defendant to pay the

Claimant’s costs, to be determined based on the amount awarded pursuant to Rule 67.5 of the

Civil Proceedings Rules 1998 (as amended).

ISSUE A: Is the Defendant an Insurance Company or a Friendly Society?

8. I am of the opinion that the Defendant is not an insurance company for the following reasons:

a. In his evidence, the Claimant stated that “I entered into a family Mediserv Medical

Fund Contract… with the Defendant for the provision of medical insurance coverage

for myself and my family…”1 However, under cross-examination he accepted that the

term “medical insurance” was not used in the application form that he signed. He also

admitted that the word “insurance” was never used in the contract and that no

representative of the Defendant told him that it was an insurance company. As he put

it “they never volunteered that information”;

b. In its Defence, the Defendant denied the Claimant’s allegations that it was an insurance

company and that it provided medical insurance coverage to him and contended that it

was not authorized to conduct business as an insurance company. In his evidence, Mr.

Samuel Bernard stated that the Defendant was not an insurance company and was not

1 Witness Statement of Rian Moyou at para. 3.

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licenced to conduct business pursuant to the Insurance Act. This evidence was not

challenged in cross-examination;

c. According to Section 2(1)(a) of the Insurance Act, Chapter 84:01, the Insurance Act

governs all companies which carry on in Trinidad and Tobago, insurance business

which falls into any of the classes specified in the First Schedule of the Act. Section 3

of the Insurance Act defines “insurance business” as the business of or in relation to

the issue of or the undertaking of liability under policies to make good or indemnify

the insured against any loss or damage including liability to pay damages or

compensation contingent upon the happening of a specified event in the currency in

which the premium had been paid. Sections 11(1)(a) and 11(2) also stipulate that,

subject to the Insurance Act, no person may carry on insurance business in Trinidad

and Tobago unless that person is a company within the meaning of the Companies Act

or any other written law and mandates that such a company shall not carry on insurance

business of any of the classes specified in the First Schedule as insurer unless it is

registered by the Central Bank in respect of that class of business. The relevant section

of the First Schedule states that:

“1. “Ordinary long-term insurance business” means business of any of the

following classes:

… (b) the effecting and carrying out of contracts of insurance against the risks …

(ii) of the persons insured becoming incapacitated as a result of disease or

of a disease of a specified class,

if, in the absence of special circumstances specifically provided for in such

contracts, they cannot be terminated before the expiration of five years from the

date on which they were entered into…”

On the evidence before me there is nothing to suggest that the Defendant was registered

by the Central Bank as a company carrying out insurance business in accordance with

the above stated provisions of the Insurance Act. Further, the express terms of the

Original Contract did not specify that medical insurance was to be provided by the

Defendant to the Claimant. Therefore, I am of the opinion that the Claimant has failed

to prove that the Defendant was an insurance company and his allegations in that regard

amounted to no more than bald assertions.

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9. Further, I am of the opinion that the Defendant is not a Friendly Society. In its Defence, the

Defendant contended that it was a Friendly Society and by virtue of Section 5(1)(a) of the

Friendly Societies Act it was exempt from registration. The Friendly Societies Act states

that:

“5. (1) The following societies shall be societies to which this Act applies:

(a) societies (in this Act called friendly societies) for the purpose of

providing by voluntary subscriptions of the members thereof, with or

without the aid of donations, for—

(i) the relief or maintenance of the members, their husbands, wives,

children, fathers, mothers, brothers or sisters, nephews or nieces, or

wards being orphans, during sickness or other infirmity, whether

bodily or mental, in old age (which means any age after fifty) or in

widowhood, or for the relief or maintenance of the orphan children

of members during minority;…

However, this Act shall not apply to a friendly society which contracts with any person for

the assurance of an annuity exceeding two hundred and fifty dollars a year, or of a gross

sum exceeding two thousand five hundred dollars.

6. (1) Every society to which this Act applies shall be registered under this Act; and it shall

be deemed to be a sufficient compliance with the provisions of this section if, before any

subscriptions or fees are collected from any member, the Registrar, by writing under his

hand, permits any person named therein (hereinafter referred to as a “permitted person”)

to take the necessary steps for the formation of a society and the society is in fact registered

within six months of the permission being given.

7. (1) A society shall not be registered under this Act unless it consists of thirty-five persons

at least…”

The Defendant has failed to provide any evidence to enable this Court to determine that it

is a friendly society that is exempt from registration under the Act. In his witness statement,

Mr. Bernard baldly asserted that “Mediserv provides risk management services to assist

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members of a friendly society known as the Ventures & Investments Programme (VIP),

with managing their medical and wellness risks.”3

10. Accordingly, I find that the Defendant is neither an insurance company nor a friendly society,

since neither the Claimant nor the Defendant has adduced evidence to prove either contention.

ISSUE B: Was the Claimant a Member of the VIP?

11. Having considered the evidence adduced on this issue, I am of the opinion that the Claimant

was a member of the VIP.

12. In its Defence, the Defendant contended that the Claimant was a member of the VIP. In his

Reply, the Claimant contended that he could neither admit nor deny this and put the Defendant

to strict proof.

13. In his witness statement4 Mr. Bernard referred to the Claimant’s membership application form

which was approved by the Defendant. He also gave evidence that on the said form the

Claimant gave certain assurances in respect of his acceptance as a VIP member. This form was

annexed as SB5 to his witness statement.

14. Under cross-examination, Mr. Bernard indicated that the said form contained two (2)

applications: (1) an application to become a member of the VIP; and (2) an application to

participate in the Fund. Upon an examination of SB5, the first part of the document appears to

be an application for membership in the VIP and the second part, an application to participate

in the Plan. In respect of the application for VIP membership, SB5 clearly indicated that on 5th

August, 2004, the Claimant applied to become a member of the VIP. Therein, he indicated that

he was informed about the VIP by another member, Rolfe Moyou and that he desired excellent

service from the VIP. Further, the following words appeared on the form immediately above

where the Claimant affixed his signature: “I hereby apply for membership in the VIP…” Also

of note is the fact that in the following section of the form, which was the application for

membership in the Plan, the words “Venture Investment Programme” were included as the

Name of the Group.

3 Witness Statement of Samuel Bernard at para. 3 4 At paragraphs 25 and 26

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15. Under cross-examination on SB5, the Claimant stated that “I was given an application form. I

read it and signed it…”

16. Accordingly, the Defendant has proved to my satisfaction that the Claimant applied to become

a member of the VIP and was thereafter accepted.

ISSUE C: What was the applicable Contract as at the date of the Claimant’s claims – the

Original Contract or the Revised Contract?

17. It is not in dispute that at the time of the Claimant’s acceptance into the Plan and the

commencement date of the Claimant’s coverage under the Plan (1st October, 2004), the

Original Contract was the applicable version of the Mediserv Medical Fund Contract.

18. The Defendant alleged, however, that the Original Contract was revised in 2007 and that in

January 2007 the Defendant notified the Claimant of its intention to review the Original

Contract. The Defendant relied on clause 7 of the General Fund Description in the Original

Contract which provided that “The Principal agrees that the Company is hereby permitted to

add, vary or delete any terms or conditions of this agreement at any time without notice.”

19. In his witness statement,5 Mr. Bernard stated that the Defendant was permitted under the

Original Contract to make changes as it saw fit so as to manage the Fund and the Plan and that,

by letter dated 19th January, 2007, the Claimant was notified of the proposed changes. He also

stated that the Claimant did not raise any objection to the proposed draft revised contract which

became effective on 1st March, 2007. Accordingly, as at the date of the submission of the

Claimant’s claims, the applicable contract was the Revised Contract.

20. Under cross-examination, Mr. Bernard insisted that the Defendant was authorised to make

changes to the Original Contract and that this was not callously done.

21. In his Reply and Defence to Counterclaim, the Claimant denied receipt of the notification letter

or a copy of the Revised Contract until the latter was supplied to his Attorney-at-Law. In his

witness statement, he denied that he approved of or agreed with or signed as accepting the

terms of the Revised Contract and stated that he did not have an opportunity to review it and

was not bound by its terms since it was varied without his knowledge or approval. He also

denied receiving the notification letter.

5 Para. 23 – 24, 29-30.

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22. Under cross-examination, the Claimant maintained his position.

23. According to Chitty on Contracts:6

“At common law a contract may validly give to one contracting party the power

unilaterally to vary the obligations of the parties to the contract”

24. Halsbury’s Laws of England put it this way:7

“At common law, one party cannot unilaterally validly vary the terms of the contract

(except by way of release), but such unilateral variation may constitute a repudiation of

the contract by him. However, the original contract may validly grant to one of the

contracting parties a unilateral power of variation.”

25. Further, Wilken and Ghaly on The Law of Waiver, Variation and Estoppel8 stated as

follows on agreements permitting variation:

“2.43 The common law allows agreement permitting variation in two cases. First, when

the parties incorporate within the contract a set of rules themselves providing their own

variation or amendment… Second, where the parties have either expressly or impliedly

agreed that one or both of them should have the power to vary agreement, subject to one

caveat, that party will have that power. The caveat relates to powers to vary unilaterally.

Not only may such powers fall foul of the unfair contract terms legislation but Courts may

also require the power to be expressed in clear and unequivocal terms.” [emphasis mine].

26. By way of his written submissions, Counsel for the Claimant, Mr. Sagar submitted that the

purported variation of the Original Contract was unilateral and without the Claimant’s consent

and such a term in a contract was onerous, unconscionable, whimsical and oppressive. Counsel

relied on A Schroeder Music Publishing Co. Ltd v Macaulay (1974) 3 All ER 616 to support

his submission that the Original Contract should be compared with a contract where there was

no negotiation between the parties and as such there was no presumption that the terms were

fair and reasonable. As such, the Court should consider all the provisions to determine whether

the bargain was fair.

27. In my opinion, the issue of the unconscionability of the term of the Original Contract which

authorised the Defendant to vary the terms of the contract without notice to the Claimant was

6 Volume 1. 32nd Editio (2015) at para. 22-039 7 Volume 22 (2012) at para. 582. 8 3rd Edition (2012) at para. 2.43

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not raised by the Claimant in his Statement of Case or in his Reply and Defence to

Counterclaim. Significantly, in his Reply and Defence to Counterclaim, the Claimant did not

make any allegation that the relevant clause in the Original Contract which authorised the

Defendant to vary the contract without notice was oppressive, onerous, unreasonable and

capricious or that there was an implied term that the Defendant would not exercise this power

in an unreasonable, onerous, capricious or unconscionable manner. Further, although the

Claimant in his Witness Statement denied receipt of the notification letter or that he approved

of or agreed with or signed as accepting the terms of the Revised Contract and contended that

he was not bound by its terms, his allegations of breach of contract as set out at paragraph 19

of his Statement of Case relied entirely on clauses from the Revised Contract.

28. In light of this, in the absence of any pleading of the existence of an implied term and the

breach thereof by the Defendant, I find that the Claimant is not permitted to raise this issue for

the first time in the closing submissions. Further, there is no evidence that when the Defendant

revised and replaced the Original Contract in 2007 it acted dishonestly, for an improper

purpose or to the prejudice or disadvantage of the Claimant.

29. Accordingly, I am of the opinion that at the time when the Claimant submitted his claims for

reimbursement of medical expenses in 2008, the applicable contract between the parties was

the Revised Contract.

ISSUE D: Is the Claimant barred from bringing this action as a consequence of his failure

to give written notice of intended legal action?

30. I am of the opinion that the Claimant is not legally barred from bringing this action by virtue

of his failure to give written notice of his intention to initiate legal proceedings against the

Defendant.

31. In its Defence, the Defendant averred that pursuant to Section 2A-4-7 of the Revised Contract,

no legal action may be brought to recover under the membership plan if, after one year of the

occurrence of the loss, written notice of the intended legal action has not been given to the

company. However, the Defendant failed to lead any evidence to support this plea.

32. On the evidence, the Claimant incurred loss on the dates when the Defendant denied his claims

by letters from the Defendant’s Claims Examiner II, Ms. Bahadur dated 27th May, 2008, 11th

September, 2008 and 20th October, 2008. In his Statement of Case, the Claimant alleged that

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his former Attorneys-at-law wrote several letters to the Defendant in respect of its denial of his

reimbursement claims. In its Defence, the Defendant admitted receiving these letters.

33. On an examination of the said correspondence sent to the Defendant dated 20th August, 2008,

7th November, 2008 and 30th December, 2010 respectively, it is clear that the Claimant put the

Defendant on notice that he intended to pursue legal action against it.

34. In the circumstances, I am satisfied that the Claimant gave notice to the Defendant by letters

from his Attorney-at-Law dated 20th August, 2008 and 7th November, 2008 of intended legal

action. Accordingly, the Claimant is not barred from pursuing this claim against the Defendant.

ISSUE E: Did the Defendant breach the contract by its refusal to reimburse the Claimant

for his medical expenses on the grounds that:

a. The Claimant failed to indicate in his claim forms whether he had used tobacco or

tobacco products or indicated that he had never used tobacco or tobacco products?

b. The Claimant’s epigastric pain was an excluded risk under the Pre-Existing

Condition clause, since the symptoms thereof presented themselves in March 2006

during the incubation period set out in the Revised Contract. In the absence of a

medical certificate certifying that the epigastric pain symptoms in 2006 had been

cured, the Defendant was entitled to treat the Claimant’s diagnosis of carcinoma of

the stomach in 2008 as a continuing illness?

c. The Claimant’s past use of tobacco was an excluded risk under the terms of the

contract?

35. I am of the view that the Defendant breached the contract by its refusal to reimburse the

Claimant for his medical expenses (in relation to certain claims as identified below) based on

its determination that:

a. The Claimant’s responses on the claim forms with regard to his use of tobacco or

tobacco products amounted to a misrepresentation which entitled the Defendant to deny

liability;

b. The Claimant’s epigastric pain was an excluded risk under the Pre-Existing Condition

clause and the Defendant was entitled to treat the Claimant’s diagnosis of carcinoma

of the stomach in 2008 as a continuing illness; and

c. The Claimant’s past use of tobacco was an excluded risk under the terms of the contract.

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36. Halsbury’s Laws of England11 states as follows with respect to the interpretation of express

contractual terms:

“358. The basic principle is that interpretation is 'the ascertainment of the meaning which

the document would convey to a reasonable person having all the knowledge which would

reasonably have been available to the parties in the situation in which they were at the

time of the contract', or which is 'reasonably available to the person or class of persons to

whom the document is addressed'. It is clear from this that the document setting out the

parties' agreement is to be interpreted objectively. The knowledge reasonably available to

the reasonable person is referred to as the 'background' or the 'matrix of facts'…

360. It remains the case that the primary source for understanding what the parties meant

is their language interpreted in accordance with conventional usage, and where the parties

have used unambiguous language the courts must apply it even if it produces a

commercially improbable result. But it has also been acknowledged that the process of

interpretation is a 'unitary exercise' in the sense that the courts do not consider the words

used in a vacuum but always in the context of the 'background'. If, in that context (as is

often the case), there are two possible constructions, the court is entitled to prefer the

construction which is consistent with business common sense and to reject the other. It is

not necessary to conclude that, unless the most natural meaning of the words produces a

result so extreme as to suggest that it was unintended, the court must give effect to that

meaning, though clearly the courts are more likely to depart from the ordinary meaning of

the words used if that meaning would lead to an absurd result. Furthermore, it is the task

of the court to construe the contract as a whole and an over-literal interpretation of one

provision without regard to the whole may distort or frustrate the commercial purpose. On

this basis, the court may give effect to the intention of the parties by transposing words;

supplying omitted words ; rejecting misnomers or surplusage ; correcting grammatical

errors; and construing ambiguities to save a document. What is not permitted is for the

courts simply to produce the contract which they think the parties ought reasonably to have

entered into.”

11 Volume 22 (2012) at paras.

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37. Accordingly, a determination of whether the Defendant breached the terms of the contract

when it refused to reimburse the Claimant, calls for an objective interpretation of the contract

as a whole in order to ascertain the meaning which it would convey to a reasonable person

with the background knowledge reasonably available to the parties at the time of the contract.

38. The Revised Contract provides as follows:

a. Clause 33 (Section 1) – “The Incubation Period: - the time duration between which

an illness is acquired and its symptoms are manifested. In this Fund the classification

of any illness by Incubation Period is determined exclusively by the Company and is in

incontestable. Adjustments are made to cater for risks; the convenience of the member;

the administration of the fund and clinical statistics from the medical fraternity. The

Table of Incubation Periods compiles illness by Class and it can be recompiled at any

time. At the submission of claims all illnesses of a Class are deemed to have the

Incubation Period of that Class. The most recent version of the table is available at the

office of the Plan Administrator.”

b. Clause 47 (Section 1) – “Pre-existing Condition: - any abnormal condition of mind

or body that may require medical attention and was present in the Member on or before

the Member’s Commencement Date. A Pre-existing condition shall exist if the member

experiences illness or suffer symptoms of any illness on the commencement date of that

Member or if the symptoms manifest themselves so as to suggest to the Company that

given the Incubation Period of the illness as classified in the Table of Incubation

Periods the illness was present on the Commencement Date.”

c. Clause 7 (Section 2A) – “Coverage is provided for necessary reasonable expenses for

all illnesses acquired after the Member’s commencement date; HIV/A.I.D.S and

excluded illnesses excepted …”

d. Clause 10 (Section 2A) - “New Members joining the Plan possessing Pre-existing

Conditions shall be covered for all other illnesses and must be certified cured of the

Pre-existing Condition before being eligible to make Claims against the recurrence of

the Pre-existing Condition. The Member must be certified cured by a doctor and the

Date of Certification shall be used to observe an Incubation Period for any relapse of

the Pre-existing Condition. An occurrence of the Pre-existing Condition within the

Incubation Period of the illness shall be treated as the same Pre-existing Condition…”

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e. Clause 71 (Section 2A) – “The Member warrants that it is clearly understood and

accepted that the risk associated with the medical coverage offered is based on the

Member’s actual state of health at the Commencement Date, as determined by the Pre-

Existing Condition clause; or any other criteria that impacts upon eligibility, not the

Member’s knowledge of his state of health.”

f. Clause 78 (Section 2A) – “Coverage is excluded for any injury, complications

(including death), treatment, Services and expenses related to or associated with or

arising out of, directly or indirectly from the following; … tobacco … use … pre-

existing conditions.”

The Claim Forms

39. The Claimant pleaded that he incurred the following expenses and that he submitted claim

forms to the Defendant in respect thereof:

a. 3rd March, 2008 - Cancer test costing $2,955.00;

b. 4th April, 2008 - Surgery and hospital bill costing $110,113.00;

c. 3rd July, 2008 - Test costing $2,955.00;

d. 7th September, 2008 - Cancer Test, Pathology Report and Blood Test costing $2,900.00;

e. 8th November, 2008 - Test by Dr. Kavi Capildeo costing $2,129.46

f. 8th November, 2008 - Chemotherapy at the Cancer Centre costing $10,326.60

40. In his witness statement, the Claimant gave evidence that he completed and submitted seven

(7) Medical Claim Forms to the Defendant on the following dates:

a. 3rd March 2008 for $2,935.00

b. 4th April, 2008 for $119,113.00;

c. 7th August, 2008 for $2,830.00;

d. 7th September, 2008 for $2,900.00;

e. 10th September, 2008 for $1,500.00;

f. 8th November, 2008 for $10,326.60; and

g. 8th November, 2008 for $2,129.46.

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41. However, the Claimant did not give any evidence in support of his allegation that he submitted

a claim form dated 3rd July, 2008 for $2,955.00. Further, although the Claimant gave evidence

that he submitted claims dated 7th August, 2008 and 10th September, 2008, these claims were

not referred to in his Statement of Case. Accordingly, since it is trite law that special damages

must be specially pleaded and specifically proved, the Claimant’s claim forms dated 3rd July,

7th August and 10th August 2008 shall not be taken into account by the Court.

42. On an examination of the remaining medical claim forms, it is apparent that the dates of the

claims have been misstated by the Claimant on 3 of the 5 claim forms. This can be deduced

from the date on the Defendant’s stamp acknowledging receipt of the claims. Accordingly, the

following is to be noted:

a. The correct date of the claimant’s claim allegedly dated 7th September, 2008 in the sum

of $2,900.00 is 9th July, 2008 (having been received by the Defendant on 12th August,

2008);

b. The correct date of the claimant’s claim allegedly dated 8th November, 2008 in the sum

of $2,129.46 is 11th August, 2008 (having been received by the Defendant on 12th

August, 2008); and

c. The correct date of the claimant’s claim allegedly dated 8th November, 2008 in the

sum of $10,326.60 is 11th August, 2008 (having been received by the Defendant on 12th

August, 2008).

43. Therefore, the following five (5) medical claims fall for consideration:

a. 3rd March 2008 for $2,935.00

b. 4th April, 2008 for $110,113.00 (and not $119,113.00 as stated in the witness

statement);

c. 9th July, 2008 for $2,900.00;

d. 11th August, 2008 for $10,326.00; and

e. 11th August, 2008 for $2,129.46.

44. The claim form dated 3rd March 2008 was received by the Defendant on 14th March, 2008. The

value of this claim was $2,935.00 and the illness or condition identified thereon by the

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Claimant was stated as “Gastric Ulcer/Cancer”. The Claimant’s diagnosis was referred to as

“Dyspepsia” and the surgical procedure performed was described as a gastroscopy by the

Claimant’s doctor on the Attending Physician’s Statement (located to the back of the Medical

Claim Form).

45. By letter dated 27th May, 2008 from the Defendant to the Claimant, this claim was identified

as a claim for dyspepsia and was declined by the Defendant on the basis that his dyspepsia was

associated with his ineligible epigastric pain and carcinoma of the stomach.

46. The claim form dated 4th April, 2008 was received by the Defendant on 10th April, 2008. The

value of this claim was $110,113.00 for the cancer operation and the date of the symptoms first

occurring is identified by the Claimant as 6th March, 2008. The underlying cause of the

Claimant’s condition was referred to as “Idiopathic” by the Claimant’s doctor on the Attending

Physician’s Statement (located to the back of the Medical Claim Form).

47. By letter dated 27th May, 2008 from the Defendant to the Claimant, this claim was identified

as a claim for carcinoma of the stomach and was declined by the Defendant on two grounds:

a. Firstly, that the Claimant was not enrolled in the Plan long enough to have consumed

the necessary incubation period to be eligible for reimbursement for this illness. The

letter identified the Claimant’s date of symptoms/first treatment as 23rd March, 2006

and stated that he would have been eligible for reimbursement if his symptoms first

manifested after 30th September, 2006 or if he had joined the Plan before 23rd March,

2004; and

b. Secondly, that his circumstances associated with the use of tobacco products was

outside of the scope of the contract.

48. The claim form dated 9th July, 2008 was received by the Defendant on 12th August, 2008. The

value of this claim was $2,900.00 and the illness or condition identified thereon by the

Claimant was stated as “Cancer Test (pathology report)”. There were two claim forms dated

11th August, 2008 which were also received by the Defendant on 12th August, 2008. The value

of these claims were $2,129.46 and $10,326.60 respectively and the illness or condition

identified on the first claim was stated as “Cancer Test (pathology test)” and on the second

claim as “Cancer Chemo”. The Claimant’s diagnosis was referred to as “Gastric Carcinoma”

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by the Claimant’s doctor on the Attending Physician’s Statement on all 3 forms (located to the

back of the Medical Claim Forms).

49. By letter dated 11th September, 2008 from the Defendant to the Claimant, these claims were

identified as claims for gastric carcinoma and were declined by the Defendant on the ground

that the present illness was related to and associated with carcinoma of stomach as outlined in

its earlier letter dated 27th May, 2008.

Misrepresentation by the Claimant

50. On the issue of misrepresentation, it is apparent that 4 of the 5 forms do not contain any

question in respect of the Claimant’s smoking history and as such do not fall to be considered

on the basis of misrepresentation by the Claimant. As such, the Defendant is not entitled to

rely on misrepresentation on the Claimant’s part with respect thereto in support of its denial of

liability. The remaining form which is dated 11th August, 2008 amounting to $10,326.60

contains the following questions:

“19. Has the patient ever used tobacco or tobacco products?...

20. If tobacco use is currently terminated, please state Reason (R) and Date …”

In answer, the Claimant responded ‘No’ to question 19 and ‘NA’ to question 20.

51. On the said medical claim form the Claimant attested to the following Clause:

“I certify that the forgoing answers are true and correct to the best of my knowledge and

understand and accept that omission or misrepresentation of any material fact shall

constitute a breach of contract.”

52. According to Halsbury’s Laws of England, a misrepresentation is a positive statement of

fact, which is made or adopted by a party to a contract and is untrue. 12 It goes on to state that:

“764. No misrepresentation, however gross or fraudulent, draws with it any civil

consequences unless it was material and was intended to, and did, influence the mind of

the representee so as to affect his conduct. Inducement in fact and materiality are distinct

and separate matters, and in any form of proceedings it is necessary to establish both…

12 Volume 76 (2013) at para. 701.

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Actual inducement must be shown, irrespective of materiality. In other words, however

probable it may have been in any case that the misrepresentation alleged would influence

a normal person to take just the steps which the representee did, yet, if in fact he was not

so influenced, he has no cause of action…

801. A representee who knows the truth is not deceived. Proof, therefore, of such

knowledge is a complete answer to any proceeding founded on misrepresentation, and it

is sufficient to show that the representee was aware of the real facts at any time before he

altered his position on the faith of the false statement.”

53. In my opinion, based on the undisputed fact that the Claimant was a past tobacco user, his

responses denying same on the aforementioned medical claim form constituted

misrepresentations.

54. As to the effect of these misrepresentations, I am of the view that this does not invalidate the

Claimant’s claim. In the first instance, the Defendant has failed to lead any evidence to support

the fact that these misrepresentations were material and were intended to, and did, influence

the Defendant so as to affect its conduct. In any event, the Defendant cannot be said to have

been induced by the Claimant to its disadvantage or loss, as the Defendant not only denied the

Claimant’s claim, but in its letter to the Claimant dated 11th September, 2008 (in answer to the

claim received on 12th August, 2008), it stated that the reason for its denial of the Claimant’s

claims was on the basis that the Claimant’s illness was related to and associated with carcinoma

of the stomach.

55. In addition, the Defendant knew of the Claimant’s past smoking history prior to receipt of the

claim form dated 11th August 2008, having admitted receiving a letter from the Claimant dated

1st April, 2008 wherein the Claimant admitted to smoking in the past. Based on this, it is clear

that the Defendant knew that the Claimant was a smoker in the past and could not have been

deceived by the erroneous answers given by the Claimant in the said medical claim form.

56. Therefore, I am of the opinion that although the Claimant’s responses with respect to his

smoking history on the medical claim form dated 11th August, 2008 amounted to

misrepresentations, they do not invalidate his claim.

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Pre-existing Condition

57. The Defendant pleaded13 that in a claim form submitted by the Claimant in 2008 for epigastric

pain, the Claimant disclosed that he presented symptoms of epigastric pain in March 2006 and

since the Claimant had only been enrolled in the Plan from 1st October, 2004, the requisite

incubation period of 24 months had not been attained. Accordingly, the Defendant was entitled

to treat the epigastric pain as a pre-existing condition. The Defendant also contended that the

Claimant had failed to provide any proof, as required under the Revised Contract, that the 2006

epigastric pain was cured.

58. In his witness statement, Mr. Bernard indicated that when the Claimant’s first claim was

submitted in July 2008 the claims examiners discovered that he suffered from epigastric pain

in 2006. Therefore, he agreed and approved the determination that this was a pre-existing

condition and that the Claimant’s claim was ineligible for reimbursement. Further, he stated

that the Claimant failed to submit a medical certificate certifying that this pre-existing

condition had been cured. Under cross-examination, Mr. Bernard stated that he had the final

say as to what was the incubation period and this was incontestable. He also indicated that the

incubation period depended on medical information that the Defendant acquired. As to the

Defendant’s determination that the Claimant’s carcinoma of the stomach was a pre-existing

condition, Mr. Bernard stated that:

“I fixed incubation periods for illness. The definition of incubation period is between when

the illness is acquired and when it is manifested. I did not send him for a medical. The

symptoms of carcinoma first manifested themselves during the time he was smoking. I am

withdrawing that answer. The answer is when he had epigastric pain. I got information

about epigastric pain. I did not call medical evidence. I assumed that it was when the

carcinoma was acquired. I have no evidence from a medical person. Illness was acquired

and manifested itself at same time…I have not consulted doctor about Mr. Moyou. I had

information.”

59. Further, in answer to the court on this issue, he stated as follows:

13 Para. 13 (ii) of Defence

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“I relied on medical information in relation to carcinoma and epigastric pain. I looked at

medical reference book. I also consulted Dr. Sinanan. I did not say anything in my Witness

Statement about going to Dr. Sinanan and consulting medical reference book. I can't

remember if Dr. Sinanan gave medical report. We did not disclose any such medical report.

I do not have qualifications in the medical field. I am saying that epigastric pain was the

first symptom of carcinoma and he was diagnosed with carcinoma at a later date in 2008.

I came to this conclusion based on the medical reference book and the advice of Dr.

Sinanan. He did not examine Mr. Moyou. I would have supervised Ms. Bahadur in her

communication with Dr. Sinanan. He would have been sent information but not a report.

He would have been asked whether epigastric pain is related to or associated with

carcinoma. He replied in the affirmative. Dr. Mitra Sinanan is doctor and he is alive. He

may not have written back. I don't recall seeing letter from Dr. Sinanan. I did not disclose

this because I am new to the litigation process. I did not call Dr. Mitra Sinanan as a witness

because I did not realise it was important and I now understand what the court looks for.”

60. The Claimant contended that the diagnosis of gastric adenocarcinoma was not related to the

epigastric pain he experienced in 2006. In his witness statement, he gave evidence that the pain

he complained of in March 2006 was not related to his diagnosis of early carcinoma of the

stomach in 2008 but was related to a bicycle accident in March 2006 and that this pain went

away without any medical treatment. This was also confirmed by the Letter of Medical

Necessity dated 8th July 2008 from Dr. Ahamad which was included in the bundle of

documents tendered into evidence by consent of the parties (RMA 46). However, under cross

examination, the Claimant gave the following evidence:

“I was diagnosed with carcinoma of stomach in March 2008. Prior to that I had epigastric

pain. I experienced epigastric pain after bicycle accident. This was a year or 2 before I

was diagnosed with carcinoma. This was around 2006-2007. My memory about when I

had bike accident is a bit fuzzy.

I was examined by Dr. Climaco by August 2004. This was in relation to bike accident. I

could have been off when I had the bike accident. The epigastric pain was in 2004. This

was same year I entered into contract with the Defendant. I received no treatment for

epigastric pain. I landed on my head in a race. The bike landed on my stomach. I had pain

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in my stomach. She just gave me a form to get an X-ray. After getting the results of the X-

ray, the pain disappeared quickly…”

61. The determination of whether the Defendant was entitled to refuse the Claimant’s claims on

the basis that he suffered from a pre-existing condition as at 1st October 2004, the

commencement date of the Original Contract, depends on an interpretation of clause 47 of the

Revised Contract. For ease of reference, this clause provides that “a pre-existing condition

shall exist if the member experiences illness or suffer symptoms of any illness on the

commencement date of that member or if the symptoms manifest themselves so as to suggest to

the Company that given the Incubation Period of the illness as classified in the Table of

Incubation Periods the illness was present on the Commencement Date.”

62. In order to successfully invoke this clause, therefore, the Defendant bears the burden of proving

that the Claimant was suffering from carcinoma of the stomach as at 1st October, 2004 or that

he manifested symptoms of carcinoma of the stomach so as to suggest to the Defendant, based

on an incubation period of 24 months for cancer specified in the Table of Incubation Periods,

that that illness was present on the 1st October 2004.

63. Counsel for the Defendant, Mr. Trotter submitted that since the Claimant admitted that he

experienced and was treated for epigastric pain in 2004, that epigastric pain could be caused

by or was a symptom of stomach cancer and that the Claimant had to be treated as having

stomach cancer prior to joining the Plan.

64. In my opinion, a reasonable person having all the knowledge which would reasonably have

been available to the parties in the situation in which they were at the time of the contract

would interpret clause 47 to mean that the Claimant would not be covered by the Plan if either

(a) he was suffering from carcinoma of the stomach on the 1st October 2004, or (b) the

epigastric pain that the Claimant experienced in 2004 was a symptom of carcinoma of the

stomach.

65. The question remains, however, whether the Defendant is entitled to treat the Claimant as

excluded from the Plan based solely on the opinion of Mr. Bernard. It is clear that under cross-

examination Mr. Bernard was at first confused as to when he was saying that the Claimant first

manifested symptoms of carcinoma of the stomach. At first, he said it was during the time he

was smoking but he quickly changed that to say it was when he had epigastric pain. He then

stated that he “assumed” that the Claimant acquired carcinoma of the stomach when he had the

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epigastric pain. He readily admitted that he did not have any medical qualifications but sought

to support his conclusion based on his reading of a medical reference book and his consultation

with Dr. Sinanan. However, neither of these allegations were pleaded in the Defence or were

referred to in his Witness Statement. When pressed about the alleged advice of Dr. Sinanan,

he admitted that he had never seen a medical report from Dr. Sinanan and that he only

supervised Ms. Bahadur in her consultation with Dr. Sinanan. Further, the Defendant did not

disclose any report from Dr. Sinanan and Dr. Sinanan was not called as a witness, although he

is alive and presumably available to attend Court. Based on these answers, I do not believe that

Mr. Bernard or any officer of the Defendant ever sought or obtained medical advice with regard

to the Claimant’s condition.

66. In my opinion, a reasonable person would not interpret the Revised Contract in such a manner

as to confer on Mr. Bernard, as the Trustee and Administrator of the Plan, an unfettered

discretion to make an assumption, without the benefit of any medical advice or evidence, that

the Claimant either had carcinoma of the stomach on 1st October 2004 or that the epigastric

pain that he experienced in 2004 was a symptom of carcinoma of the stomach.

67. Mr. Trotter also sought to elicit evidence from Dr. Dhanessar to support the Defendant’s

determination that the Claimant had a pre-existing condition as at the commencement of the

Original Contract. Several questions were posed to Dr. Dhanessar and his responses were

outlined in an annexure to his witness statement as WD2. Therein, he indicated that epigastric

pain could be caused by multiple factors which included stomach cancer as well as trauma to

the area. He indicated that “incubation period”, as defined by the Defendant in its contract, was

consistent with the medical definition of the term. He went on to state that the incubation period

for cancer varied widely and could range from a few years to more than 20 years. Accordingly,

it was impossible to accurately forecast the exact incubation period for stomach cancer.

68. Further, Dr. Dhanessar also stated that there are several factors of which epigastric pain could

be symptomatic. Although stomach cancer was one, it was not the sole factor. There were tests

that could have been done to determine whether the Claimant’s epigastric pain was connected

to his diagnosed stomach cancer. However, there was no evidence before me that any such test

was performed.

69. On the totality of the evidence, therefore, I am of the opinion and so find that the Defendant

has failed to prove to my satisfaction that (a) the Claimant was suffering from carcinoma of

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the stomach on 1st October 2004; or (b) the Claimant’s epigastric pain in 2004 was a symptom

of that illness; (c) in the absence of a medical certificate certifying that the epigastric pain

symptoms had been cured, the Claimant’s diagnosis of carcinoma of the stomach in 2008

should be treated as a continuing illness.

70. Accordingly, I find that the Defendant breached the Revised Contract when it determined that

the Claimant was not entitled to be reimbursed under the Revised Contract by virtue of the pre-

existing condition clause and the Claimant’s failure to consume the specified incubation

period.

Tobacco Use

71. The Claimant alleged that his tobacco use (which ceased more than 20 years ago) did not cause

or contribute to his carcinoma of the stomach. In his witness statement, he reiterated this and

stated that this was confirmed by his doctor, Dr. Ariyanayagam. The medical report of Dr.

Ariyanayagam was included in the Claimant’s bundle of documents tendered into evidence by

consent of the parties and marked “RMA 45.”

72. In his report, Dr. Ariyanayagam stated as follows:

“Mr. Rian Moyou presented on November 27th 2007 complaining of stomach problems

requiring him to eat meals regularly for five (5) months previously. He subsequently

underwent upper gastro intestinal gastroscopy on March 3rd 2008 when carcinoma of the

stomach was diagnosed. There is no incubation period that is documented for carcinoma

of the stomach. Therefore to turn down a claim based on “incubation period” for this

condition is not medically justifiable. This is a conclusion which usually manifests itself at

an advanced stage and fortunately Mr. Moyou’s case was diagnosed at an early stage when

he could have curative surgery. His consumption of tobacco stopped approximately twenty

(20) years prior to this illness and has no contribution towards it. It is also to be noted that

his consultation with his family practitioner on March 23rd 2006 was for a trauma from a

bicycle accident and is not related to his current illness.”

73. The Claimant also tendered into evidence as “RMA 46” a Letter of Medical Necessity from

Dr. Ahamad, Clinical Oncologist at the Brian Lara Cancer Treatment Centre dated 8th July

2008. Of particular importance in that letter is the opinion expressed by her in the final

paragraph in that letter:

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“Of note is the patient’s question whether epigastric pain 2 years ago would have any link

to his current cancer and I explained to the patient that if indeed he did have gastric cancer

in 2006 that it would not be a Stage 1 in 2008 since the behaviour of Gastric Cancer is

extremely aggressive and will progress over that period of time to become fairly extensive

local regional disease and therefore it is unlikely that his Epigastric pain in 2006 is related

to the current diagnosis of Gastric Adenocarcinoma.”

74. The Defendant contended that the Claimant’s past tobacco use was a risk factor for carcinoma

of the stomach and was an excluded risk under the Revised Contract. In his witness statement,

Mr. Bernard was insistent that tobacco risk was clearly an excluded risk.

75. A determination of this issue turns on whether the Claimant’s condition of carcinoma of the

stomach was related to, associated with or arose directly or indirectly out of his past use of

tobacco. The reports of Dr. Ariyanayagam and Dr. Ahamad clearly contradict the Defendant’s

contention but the Court did not have the benefit of their evidence under cross-examination in

relation thereto. Accordingly, the evidence of the medical expert appointed by the Court, Dr.

Dhanessar takes on even greater significance.

76. Dr. Dhanessar stated that it was possible but highly unlikely that the smoking of cigarettes by

a person approximately 20 years ago was the cause of carcinoma of the stomach diagnosed in

2007 – 2008. He indicated that there were multiple factors that were associated with stomach

cancer including smoking. He also stated that smoking by itself was unlikely to cause epigastric

pain but in some individuals it may occur. As to the Claimant’s diagnosis of stomach cancer,

Dr. Dhanessar stated that in its present stage medical science could not definitely say that the

risk factor of smoking was not responsible for the Claimant’s stomach cancer.

77. Under cross-examination, Dr. Dhanessar stated that smoking by itself was unlikely to cause

epigastric pain and that “smoking was very very unlikely the cause of this patient’s cancer of

the stomach.”

78. However, he indicated that his statement about smoking being an unlikely cause of cancer was

based on statistics and he was not an expert on statistics. He also admitted that tobacco use was

a risk factor in stomach cancer but he described the correlation as very small.

79. I am of the opinion that a reasonable man would interpret Clause 78 of the Revised Contract

to mean that once a member’s illness (in this case, carcinoma) was related to or associated

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with or arose from tobacco use, coverage was excluded. However, the Defendant did not obtain

any medical advice or adduce any evidence that the Claimant’s illness was related to or

associated with or arose from his tobacco use. In fact, this conclusion was based once again on

Mr. Bernard’s layman’s opinion as Trustee and Plan Administrator that the Claimant’s

diagnosis of carcinoma of the stomach in 2008 was related to, associated with or arose directly

or indirectly from his prior use of tobacco. Although Dr. Dhanessar stated that smoking was in

fact one of the many factors that was “associated” with stomach cancer, having not examined

the Claimant, he could not say whether the Claimant’s carcinoma of the stomach was related

to, associated with or arose directly or indirectly out of his past use of tobacco. In my opinion,

the Defendant was not entitled to rely on this exclusion clause based on Mr. Bernard’s opinion

only and it could only do so by adducing medical evidence to that effect.

80. Accordingly, I am of the view that the Defendant, having failed to lead any evidence to prove

that the Claimant’s carcinoma of the stomach was in fact related to, associated with or arose

directly or indirectly out of his past use of tobacco, breached the contract when it denied

reimbursement of the Claimant’s claims on this ground.

ISSUE F: Is the Claimant entitled to the relief sought? If not, is the Defendant entitled to be

discharged from liability under the Plan?

81. Having determined that the Defendant was in breach of the contract by failing to reimburse the

Claimant in respect of the said five (5) medical claims, I am of the opinion that the Defendant

is not entitled to be discharged from liability under the Plan. Further, the Claimant is entitled

to relief in respect of these claims.

82. In its Defence the Defendant pleaded that even if the class of expenses claimed by the Claimant

were eligible for reimbursement under the Plan, the Plan did not provide for 100%

reimbursement and the Claimant would only be entitled to such value as set out in the Summary

of Benefits in the Revised Contract.

83. Clause 33 (Section 2A) of the Revised Contract provided that “in each claim for eligible

expenses the Principal is responsible for the deductible and his share of the co-payment and

the Company shall reimburse the rest of the eligible expenses.” Further, Clause 37 (Section

2A) provided that “each claim may carry a deductible and or Co-payment, as listed on the

Summary of Benefits, for Eligible Expenses accumulated over any unbroken 90-day interval.”

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84. However, Mr. Bernard did not give any evidence as to the deductible or co-payment listed in

the Summary of Benefits in the Revised Contract. Accordingly, on the basis that the Defendant

has failed to adduce evidence to prove otherwise, the Claimant is entitled to reimbursement of

his expenses as set out in the said 5 medical claim forms, which amount to $128,404.06.

COSTS

85. In my opinion, the Claimant is entitled to an award of costs to be determined in accordance

with Rule 67.5 of the Civil Proceedings Rules, as amended. This Rule provides that the costs

payable should be based on the value of the claim which in the case of a Claimant is the amount

agreed or ordered to be paid. Therefore, I hereby order the Defendant to pay to the Claimant’s

costs to be determined in accordance with Appendix B and based on the amount awarded.

INTEREST

86. The Claimant has claimed interest at a rate of 12% per annum from the 27th May, 2008.

However, since the medical claim forms dated 3rd March, 2008 (for $2,935.00) and 4th April,

2008 (for $110,113.00) were declined on 27th May, 2008 and the medical claim forms dated

9th July, 2008 (for $2,900.00), 11th August, 2008 (for $10,326.60) and 11th August, 2008 (for

$2,129.46) were declined on 11th September, 2008, I will award interest as follows:

a. Interest on the sum of $113,048.00 at the rate of 2.5% per annum, being half the

statutory rate,14 from 27th May, 2008 to the date of judgement herein; and

b. Interest on the sum of $15,356.06 at the said rate of 2.5% per annum from 11th

September, 2008 to the date of judgment herein.

ORDER

87. In the premises, I hereby order that:

a. The Defendant do pay to the Claimant the sum of $128,404.06 as reimbursement for his

medical claims;

b. The Defendant do pay to the Claimant interest on the sum of $113,048.00 at the rate of

2.5% per annum from 27th May, 2008 to the date of judgment herein and on the sum of

14 Section 2 of the Remedies of Creditors (Amendment) Act, 2016, Act No. 8 of 2016.

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$15,356.06 at the rate of 2.5% per annum from 11th September, 2008 to the date of

judgment herein; and

c. The Defendant do pay to the Claimant’s costs, such costs to be determined based on the

amount awarded pursuant to Rule 67.5 of the Civil Proceedings Rules 1998 (as

amended).

Dated this 7th day of December, 2016

…………………………………..

André des Vignes

Judge

the republic of trinidad and tobago in the...

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