YOU LI, THE PERSON APPOINTED TO REPRESENT THE ESTATE OF TONG KWAN, DECEASED v. NEW YORK LIFE INSURANCE WORLDWIDE LTD

HCA 250/2002

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 250 OF 2002

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J U D G M E N T

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The dispute

1.  On 22 January 1998, the defendant issued a life insurance policy to the plaintiff’s husband Tong Kwan, now deceased.  The insured sum was US$1 million.  

2.  On 6 February 1999, Mr Tong passed away at the Nan Fang Hospital in Guangzhou.  Notification of death was given to the defendant. 

3.  On 31 August 1999, the defendant gave notice that there had been a non-disclosure of the deceased’s health and the policy was treated as being void ab initio. 

The background

4.  To recapitulate on 9 January 1998, Mr Tong was examined by Dr Chik Poon Yin.  The medical report shows that he was overweight at 203 pounds.  But the urine analysis showed negative sugar result.  He was not required for a blood test under such an insurance policy unless there was any indication to follow up medical examination. 

Witnesses

5.  However a year later on 31 January 1999, Mr Tong was admitted to Nan Fang Hospital in Guangzhou.  According to the detail admission record compiled by Dr Gao Fang (高方), he said :

“現病史：緣於4年前無明顯誘因出現煩渴多飲、多食、多尿，每日飲水達3000ml，無明顯消瘦，來我院查體發現血糖升高(具體程度不詳)，診為‘糖尿病II型’，給予‘達美康’口服，血糖正常，尿糖轉陽後出院。出院後間斷服用‘二甲雙胍’、‘迪化糖啶’，血糖控制不理想，不曾監測尿糖。3天前患者因疲勞過度，飲酒過量導致左額下區腫脹、疼痛、發紅、發熱、無咳嗽、咳痰、氣喘、呼吸困難、無牙痛、咽痛，2 天出現發熱，體溫波動於38-39.5^oC之間，給予‘新菌必治’‘丁胺卡那’抗感染，療效欠佳，為進一步明確診治入院。發病來精神，食慾差，二便正常，體重無明顯減輕。

既往史：平常身體健康狀況一般，否認高血壓，腎病史，3年前因飲酒過度導致‘急性胰腺炎’來我院，給予禁食，抗感染，柳酶等處理後痊癒出院。無外傷手術史。對‘青霉素鏈霉素’過敏，否認‘肝炎’結核，菌痢‘等急，慢性傳染病史。預防接種史不詳。”

6.  The record shows that the defendant had been admitted to the same hospital four years ago in or about 1995.  He was diagnosed as having diabetes Type II and was prescribed diamicron to control his blood sugar. 

7.  Three years before that, i.e. in or about 1996, he was also admitted on acute pancreatitis by reason of his over-drinking of alcohol. 

8.  On 6 February 1999, one Dr Lee Siu Ping (李少萍) of Nan Fang Hospital certified death of Mr Tong.  She stated that his causes of death were as follows :

「死亡診斷：

1.  急性口底蜂窩組織炎併顱內瀰延，呼吸、心跳中樞衰竭。

2.  腦血流回流受阻，腦水腫。

3.  感染中毒性休克，多臟器功能衰竭。

4.  糖尿病II型。」

9.  I find Dr Gao to be a very impressive witness.  He has no interest in this case.  He came all the way from Guangzhou to testify on the only day he was available and this court accommodated his request.  He got to leave immediately after court for his ongoing medical commitments. 

10.  He specifically recalled this patient Mr Tong as he was introduced by a colleague in the hospital, who was Mr Tong’s friend.  He recalled talking to him personally.  He is frank and honest in his accurate recollection and has not tried to make up anything when he came to certain questions which he could not accurately remember.  He only kept his evidence as accurately as possible according to his clear memory. 

11.  On the contrary, I find the plaintiff Madam You to be not reliable.  It was Mr Tong’s second marriage.  Regrettably she put forward the case as if she knew nearly everything about her husband.  However the evidence pointed to the contrary.  In the first place, she did not know her husband has been taking a medicine all the time called phenfluramine.  She did not even know who prescribed this drug to him although this drug was not related to diabetes and it was only used to control his appetite. 

12.  In spite of the fact that she insisted her husband should have diet-control, she said that he actually ate a lot and especially like fatty foods.  He was significantly overweight at the time of examination by Dr Chik at 203 pounds.  Yet she said he appeared to be quite healthy. 

13.  The evidence supported the findings that Mr Tong had been a heavy alcoholic drinker.  In fact, Dr Gao opined that strong alcoholic drinks could destroy the pancreas cell leading to diabetes.  Mr Tong was actually admitted to Nan Fang Hospital for over-drinking.  In fact, according to the aforesaid admission record in January 1999, it had been said that Mr Tong had been admitted to Nan Fang Hospital four years ago and was diagnosed as having diabetes Type II.  This is in line with a document produced by the defendant : the application form for Employee Enrolments Form for Group Medical Insurance submitted to the Netherlands Insurance Company (C87).  This was signed by Mr Tong on 1 January 1999, a year after the relevant date of his application to the life insurance policy in issue.  In answer to questions 5 and 6, Mr Tong stated that he was admitted to Nan Fang Hospital in 1995 for “routine body check-up”.  Yet Madam You said there was no such incident.  

14.  In answer to question 7 “Are you … currently under medical observation or receiving any treatment or medication or aware of any symptoms which may indicate a disorder?”, Mr Tong said he was taking preventive medicine since 1997 by purchasing the same himself. 

15.  More significantly in question 8 “Have you … ever been treated or been told of … diabetes … condition?”, Mr Tong filled in “periodically check-up to prevent suffering of diabetes”.  It is true that by January 1999, the relevant date of disclosure in January 1998 had already been passed.  But this is clear evidence that at least by January 1999, Mr Tong was aware he was suffering from diabetes and yet Madam You said that she was not aware of the same until Mr Tong was admitted to Nan Fang Hospital in late January 1999 and she believed that her husband was not aware of the same all along. 

16.  Madam You only doubted the accuracy of this form as it was filled up in English.  However the words “中國南方醫院” are in Chinese and the words self-purchase “自購” are also in Chinese.  In any event Mr Tong signed this document when diabetes was clearly mentioned just two inches above his signature. 

17.  Dr Gao opined that the negative urine sugar test in January 1998 in Dr Chik’s report could well be because Mr Tong was taking diabetes medicine.  

18.  From the totality of evidence before me I come to the firm conclusion that Mr Tong knew he was suffering from diabetes in January 1998 as he was diagnosed to have diabetes Type II in 1995.  This is a material non-disclosure to the defendant in Mr Tong’s application for the life insurance policy in issue in January 1998.  Accordingly the defendant is entitled to avoid the policy ab initio. 

Conclusion

19.  The plaintiff’s action herein is dismissed.  The defendant is entitled to costs of the action, to be taxed if not agreed.