AAP MBF Trustees sending Member toward Bankruptcy

[Mark Whitaker]

* My name is Mark Whitaker and I live in Cairns. I have been in the aviation industry since 1980 and among other companies I have been Cheif Pilot with both Airnorth in Darwin and Regional Pacific Airlines in Cairns.
Since the 80’s I have been a member of the AAP MBF. 2 years ago I lost my Class 1 Medical. I sent the following letter to the Chairman yesterday morning.


Captain David Harget
Chairman AAPMBF
Austair Pilots Pty Ltd
132-136 Albert Road
South Melbourne 3205

Dear Sir,
The following are direct quotes from the rules of the AAP MBF:
INTRODUCTION FAILURE TO MEET CASA MEDICAL STANDARDS
Because of the suddenness with which a Pilot Class 1 Medical Certificate can be lost, with its serious consequences to family financial security, adequate protection against this eventuality has always been considered of the utmost importance. No less today than at any previous time.
Rule 7 (g)
Where in the opinion of the Trustee, circumstances exist that indicate that a Member or a Member’s dependants may be subject to hardship, the Trustee may in their absolute discretion commence payment disregarding the qualifying periods designated in Rule 7(f).
Rule 7 (j)
Any Member making application for benefits from the Fund shall, if required by the Trustee, submit to an independent medical examination at the expense of the Fund for the purpose of ascertaining the nature and extent of the notified disability.
And Rule 14 (b) (vii)
Do all such acts and things as may be necessary for the carrying out of the objects of the Fund.

To say I am disappointed with the performance of the Trustees would be an understatement.
Since I lost my Class 1 Medical, I have been keeping the Trustees informed of my medical condition and financial situation and completed another medical examination as per Rule 7 (j).
I have had one only formal correspondence from Trustees in the form of a letter from the old Chairman in November 2010; which included, “The Board has considered your claim and at this stage is unable to authorize the payment of a final capital benefit”. This letter was not compliant with Rule 14 (b) as it gave no reason for the decision and no advise as to what I was to do next.
I have formally offered on two occasions that I am willing to sign a DEED stating I would pay 100% of any Capital Claim if I ever regained my Class 1 Medical, I have had no formal response to this offer.
After the March Trustees meeting, I was advised by the office that the Trustees would exercise Rule 7 (j). I complied with this and the report from the Cardiologist agreed with my Cardiologists report.
At the meeting on 14-15 April you had three Cardiologists reports, all stating the same thing, I have a cardiac condition that does not meet CASA Class 1 Medical Standards and the treatment is medication only! Therefore I will never regain my Class 1 Medical.
Since that meeting I have heard nothing from the Trustees nor the office even though I called Yesterday at 12 midday and the manager was in a meeting as was to call me back. I have heard nothing!
I did notice that the monthly payment has arrived into my Bank account, but as I stated, no information as to my Capital Claim, not even an email or phone call saying a formal response from the Trustees would be forthcoming.
I advise you of my financial situation six weeks ago and due to your total lack of communication you have now backed me into a corner that I will find very hard to escape from.
I find the total lack of communication from the Trustees and you as Chairman as demeaning and insulting.
You have my email and phone numbers, please pay me the courtesy of communicating with me.
Yours Sincerely


Geoffrey Mark Whitaker

Today at 5:50 pm I received this email:

Dear Mark
Further to my telephone call to you yesterday I confirm the following:
Following your request for the payment of the balance of your capital benefit, the Board has reviewed at length the medical advice received and advise that they are unable to conclude that the suspension of your Class One is permanent. Therefore they cannot at this time authorise the payment of the balance of your capital benefit.
However in accordance with the Rules a further monthly benefit has been authorised for payment to you.
With respect to the correspondence forwarded by you by email and received yesterday this will be tabled for consideration at the next Board meeting in May.
Kind regards

Last week I had my Lawyer write to the Board of Trustees on my Behalf and the Trustees have not replied to them or me until the above email tonite. By not formally replying to me or my Lawyers this week shows that current crop of Trustees have no concept of “Corporate Governance” and no concept of there responsibilities and obligations of overseeing $100M+ organization.

6 weeks ago I informed the Trustees of my financial situation and the reasons why I find myself in this situation and of my time constraints. I also told them that if they need bank account details I would be happy to supply them. Again, I have heard nothing from them.

Next week I have booked in to see my accountant to start bankruptcy proceedings. Hopefully they can find another way around it but I will still end up with no money and no assets!

During the 21 months that I have not had a medical, the Trustees have never given any advise as how to move forward, Rule 14 (b) (vii). They have only asked for 1 thing which I complied with to see another Cardiologist for another opinion. I went to one they suggested and he agreed with the Cardiologist that performed my Angiogram 2 years ago and my own Cardiologist. I have a stuffed heart and the treatment is medication only. CASA has stated that I will never meet the standard for a Class 1 Medical with my current condition; they will only review my Class 1 Medical if I have surgery. As 3 Cardiologist have stated, I do not need surgery and 70% of people with my condition never need surgery. I will never regain my Class 1 Medical. I have even offered the Trustees that I will repay 100% of any Capital Benefit I receive if I ever get my Class 1 back. They have never responded.

I can get no answer from the Trustees as to why they are not paying out my Capital Benefit.

So why am I putting this on Pprune?

Easy, I want some answers, unfortunately for them its Membership renewal time when they ask members to hand over their hard earned $$$, and yes I make no apologies for using this to get some answers.

I believe the fund is very good and every eligible pilot should be a member, I also believe the rules are very good except for 2 changes, these are:
1. All Trustees must be current pilots and current members, not retired pilots and past members. 2 current Trustees fit this criteria.
2. If you develop a medical condition such as Type 2 Diabetes, CASA puts a condition on exercising a Class 1 Medical “As or With Co-Pilot”. Currently, this restriction is ignored by the rules. If you are an Ag pilot, Instructor or other single pilot you have lost your job with no coverage.

Now getting back to renewal time. Before handing over your money or if you are looking at joining the AAP MBF, ask a current Trustee if you know them or if you don’t, call the office and ask for a Trustee to call you back and ask this question:

“If I ever develop a medical condition that causes the loss my Class 1 Medical, will I be treated by you as you are currently treating Mark Whitaker?”

Currently the Trustees have no SOP’s, Procedures Manual or any other document that I know of that guides them in their decisions. Everything is AdHoc.

If you politely ask the Office for a Trustee to call you back and they come back to you with something like “That’s not the way we do it”; Politely inform them that there is nothing in the Rules from preventing a Trustee from calling a member and insist that one does so.

This is Pprune and posts have a habit of getting out of hand. Please don’t vilify anyone. I would like to hear what answer you get from a Trustee to the question

Mark Whitaker
Cairns
Ex Pilot currently unemployed. (I was selling boats up until 2 months ago, but lost that job due to no one buying boats!)

[The Kelpie]

C'mon guys, I do not know the details but it seems to me Mark is due to be paid out!!!

Re the issue about restricted Class 1, the questions should be asked prior to paying next year's premium as it seems to me that the MBF rules are not keeping up with the latest 'initiatives' (a term I use loosely) coming out of CASA.

Unless this is addressed it seems to me that as a single pilot operator for conditions such as type 2 diabetes the policy is not worth the paper it is written on and you should consider keeping next years premium in your pocket.

More to Follow

The Kelpie

[rmcdonal]

I do not know the details but it seems to me Mark is due to be paid out!!

Come on Kelpie, I had grown to enjoy your informed comments.
Telling pilots not to have LOL insurance because of one post on PPRuNe?


If I recall correctly Mark tried to get himself voted onto the MBF board at last years vote, interesting conflict of interest when $500,000 is at stake.

[The Kelpie]

As a member myself I am interested in this one and intend to ask the question. I was made aware of this subject recently outside the pprune forum and I don't like what I am hearing - I intend to get the facts straight from the trustees.

My comment was not simply in relation to mark whittaker's post.

What is the point of paying a premium for a policy that doesn't want to pay out?

Kelpie

[The Green Goblin]

Very interesting.

Mark, if you don't mind me asking, how much do you need to stave off bankruptcy?

Perhaps we can pass the hat around just like we did for Joe Eakins.

[fmcinop]

2 sides to every story.

The problem is surgery from what I read might fix the problem. While that is the case the MBF cannot make payment. The trustees are legally bound by the rules and would have had their own medical advisors and lawyers look at the case. Unless you can produce a letter from CASA saying under no circumstances will we ever re issue your class 1 which you don't seem to have the trustees legally cannot make payment. What you seem to have is a letter saying at the moment we will not reissue the medical but maybe with surgery we might.

The trustees have their hands tied. Knowing the current trustees and having been one myself I can assure you that if there was not some issue within the rules, they would have made payment.

I do agree than non members should not be trustees and look forward to the 2 current ones leaving once and for all.

[mustman]

What will it take? You to do the unnessacery surgery and die on the operating table?

Guess they will pay out then?

As much as rules are rules, is there still no leeway for common sense at times?

Good luck. Keep us informed!

[Captain Sherm]

We read much on these pages of poor management and improper procedures. However there are many areas of the industry where things are done properly and with every effort to achieve good outcomes.

There can be few more cut and dried cases than where a group of trustees get written advice that says that it is not possible to conclude that the loss of the Class One medical is permanent. In that situation the payment of a monthly benefit is appropriate. The member is not left in the outer darkness.

If the trustees were to be guided solely by strong letters from members then the regulators who issue their licence would be giving them a "show cause" and the benefits available to all current and future claimants could be imperilled.

Over the 50 years of the fund there has been an overwhelming support of pilots with medical issues. Every effort is made to put the "by pilots for pilots" ethic into practice with guidance by the spirit of the rules as well as the black letter. To damn the fund on the basis of one case where the member is still receiving and entitled to a monthly payment seems to me a little over the top.

[remoak]

Unfortunately there are many, many cases of pilots taking big LOL insurance payouts, only to return to flying a year or two later. It isn't necessarily anyone's fault, but insurance companies and mutual funds understandably want to be sure that the loss of licence is permanent and irrevocable before handing over the money.

If they didn't, LOL insurance would be unobtainable.

I know of four guys who have lost their medicals, seemingly without hope of ever getting them back. All four are back flying. One took a 500,000 pound payout (this was in the UK). Of course the insurance company came after him, but there was little they could do.

It also highlights the need for pilots to plan better. Your income depends on your medical, so it's wise to have a second skill to fall back on if it all turns to custard... because any insurance payout you get is highly unlikely to get you to retirement.

[paul makin]

A complex and perplexing problem, but one that, given the will, could be resolved within the ambit of the Rules of The Fund.



Public fora such as Pprune are not really a proper or satisfactory place to be discussing these matters, however given the secretive nature of the Administration of the Fund, and their refusal to allow closed access to the membership, I can understand Mark’s finding it necessary to come to this place.


Fmcinop stated

The problem is surgery from what I read might fix the problem. While that is the case the MBF cannot make payment. The trustees are legally bound by the rules and would have had their own medical advisors and lawyers look at the case.

Close but no cigar.



The Trustee, through the Board “ shall do all such acts and things as may be necessary for the carrying out of the objects of the Fund” (Rule 14 (b) (vii))


The object of The Mutual Benefit Fund is to provide financial assistance to any of it’s members whose earning capacity as a pilot has ceased or has been downgraded due to a temporary or permanent suspension or cancellation of their Class 1 Medical certificate……………” ( Rule 1 (b) )


Many years ago, the then Trustees of the Fund at a meeting with the Fund’s lawyers, received advice that; basically the discretionary powers embodied within the Rules of the Fund are wide ranging and that in effect the Trustees can apply the rules in any way they see fit, provided that such application is to the benefit of the Fund and its members and that it is not applied /conducted , in a capricious manner. My recollection is that Mr Charlesworth ( current Board member ) was at that meeting along with myself and others.


Rule 7 (f)(iv)of the fund states, inter alia: “ Notwithstanding anything herewith contained to the contrary the Trustee may in their sole and absolute discretion make a lump sum payment to a Member of the Member’s entitlement or so much of such entitlement as remains unpaid in final satisfaction of such Member’s entitlement at the end of 15 months from the date of the commencement of the disability, where the Trustee in consultation with the Medical Advisers to the Fund, decide that the suspension or cancellation of the Member’s Class 1 Medical Certificate is unlikely to be removed……………………”


Rule 8 (a) states: “ Where the suspension or cancellation of a Members Class 1 Medical Certificate has not been removed after a period of 15 months from the commencement date of the disability and it has been firmly established to the satisfaction of the Trustee, after due consultation with the Fund’s Medical Advisers that such suspension is permanent, then the balance of the Capital Benefit to which the Member is entitled shall be paid forthwith………………………….


Rule 7 (l) states ……………..”Both the commencement and continuance of such benefits shall be conditional upon satisfactory evidence being provided to show that the Member is taking all reasonable steps to have the disability rectified and the Class 1 Medical Certificate restored.




From discussion with Mark I have gleaned the following.


His condition is such that he does not meet the criteria for the continuation of his Class 1 Medical. CASA agree and have refused to issue a certificate.


His cardiologist has stated that his condition is not suitable for the use of stents.


Presently his condition is controllable with medication, but the underlying problem remains.



CASA will not re-issue a Class 1 while he is on medication alone.


Untreated or un-medicated his condition will deteriorate.


He could undergo surgery that may possibly slow or halt his deterioration.


Surgery is unlikely to permanently restore his function to the standards required to regain his Class 1 medical


Surgery at this juncture would expose him to more risk than he would endure in the absence of surgery.



His cardiologist has declined to recommend him for surgery at this stage.


He has gained two other opinions (one from an MBF designee) and neither of them has contradicted the original opinion, prognosis, or treatment.



As with any member, Mark is required to take all “reasonable “ steps to return his status to that which would lead to his Class 1 status being restored.


Is it reasonable to expect a member to go against the advice of his (and other) cardiac specialists, to put himself into a life threatening situation, on the off chance that the procedure that entails significant medical dangers, might give some, possibly, temporary respite to his condition?


Given that his cardiologist has declined to recommend surgery (at this point), how is he supposed to secure this risky surgery. Perhaps the Trustee might be happier if he went off to India or China to secure a procedure.


Mark has previously asked the Fund Manager if the decision not to process his Capital payout was as a result of an assessment by the Fund Medical adviser Dr Rob Liddell. No satisfactory answer was received. Just an indignant enquiry as to how he knew that Dr Liddell was the funds medical adviser. (News time guys, I told him. Have a problem with that?)



If indeed this decision is the result of an assessment by the Fund’s Medical adviser, is he qualified to overrule the opinions stated and implied, by three cardiologists, that surgery is not currently advised. Is Dr Liddell a cardiac specialist also?


If Mark were to undergo surgery, CASA , (unless the game rules have changed) would probably require a 2 year symptom free period before granting a Class 1 medical certificate.

Given that this has been going on for some 21 months already; lets say 6 months to get surgery organised (non life threatening ailment in the short term therefore low priority in the public health system), then a 24 month symptom free requirement for CASA; we are up to a total of 51 months from go to whoa.

And for an uncertain outcome, with life threatening risks along the way. In the event that his medical was not restored at that point, the Trustee would, under the rules, be obliged to make a determination, at 60 months as to whether or not the medical loss was deemed to be permanent.

In the meantime the Fund will be obliged to keep the Member on drip feed of 1% of Capital benefit per month. Given his parlous financial state, Mark has requested that the Trustee consider making a capital payment, which would could be used far more effectively to secure his welfare, than could the drip feed.
Mark has offered a legally binding undertaking that in the event that his medical be restored he will repay in full any funds to which he is not entitled. No response has been received to that concept.


I would put it that Mark has taken all reasonable steps to secure his medical status, but that the Trustee has been unreasonable and capricious in its application of the rules, which clearly give the flexibility to the Trustee to act for the benefit of a member.


The Trustee has the opportunity to assist a member at a time of drastic need, but has failed to rise to the challenge, in direct contravention of the spirit of Rule 1 of the Fund


In nearly 40 years with the fund, on the basis of the information that has been given to me, this would appear to be the most disgraceful and I believe capricious handling of a member’ claim that I have witnessed.


My questions to the Board would be:


Do you consider that the claimant has taken all reasonable steps to regain his medical status?

If YES. Have you explained in lay terms, why he is ineligible for a payment in accordance with 8 (a)

If NO. Do you consider, that unless the claimant is prepared to undergo a life threatening procedure, he is non-compliant with Rule 7 (l)? If so he is ineligible for further payments and you should cease his drip feed forthwith, (If not why not); and further

If NO. Given that his cardiologist has stated that surgery is contra-indicated at this point in time, what guidance have you provided the claimant, and what further steps can he take?

Is the Board’s lack of conviction that this is a “permanent loss” based on the advice of Dr Liddell, or is it an opinion formed by a majority of the,( non medically qualified), Board members, irrespective of medical advice?


If this decision was based on the advice of Dr Liddell, is he better qualified in cardiac matters, that the claimant’s two cardiologists and the AAPMBF nominated cardiologist? (Dr Liddell is a respected medical practitioner and this should not be construed as a challenge to his professional competence or reputation, just to his relative expertise)



If Dr Liddell is of the opinion that it is not possible to conclude that the loss of medical standard is permanent, he must surely be able to codify what could change to restore the claimant’s medical status. And the claimant advised accordingly. If he is not able to do so, the never say never philosophy should apply to all claimants.


For those who are about to leap on their keyboards and say take it up with the Board, I am just about to do that. My purpose in persuing this in this forum is that th Administration of the AAPMBF is a secret society and without this sort of forum members will have no knowledge other than that which is feed through the system. If the AAPMBF were an open organisation where members could communicate with members, posts such as these would not be necessary, and everyone would be much happier talking behind closed doors. Think about it Dave.

[Mark Whitaker]

* My wife Helen and I have been together of 27 years and married for 24 years. We had our first child 6 weeks after the dispute started in 89 and our third child in a Malaysian hospital. For the past few months Helen has not been sleeping and her skin is red roar with eczema due to the stress.

Today when she arriving home from work she kicked me out!

Due to this I have now lost my Career, my job, I have no money and I have now lost my family.

I have no choice other than to start legal proceedings against the AAP MBF and they will also find themselves in Bankruptcy court as they are a creditor.

I am not posting all of this because I like too, but because the Trustees refuse to talk to me!

Mark Whitaker

[Shed Dog Tosser]

Mark, whilst all of this appears very unfortunate, I have a couple of questions:

Q: have you been paid an income this whole time ?,

Q: if yes, by whom ?,

Q: if yes, what % of your income ?,and,

Q: if yes, when do you expect this income to cease ?.

[SIUYA]

Shed Dog Tosser...

What Paul Makin said.

You asked more than a 'couple' of questions....four in fact. None of which really seemed to make any sense to me. Here goes:

Q1. have you been paid an income this whole time ? [sic]

Huh? I thought Mark stated fairly clearly in post #1 that he was an:

Ex Pilot currently unemployed. (I was selling boats up until 2 months ago, but lost that job due to no one buying boats!)

Seems fairly clear that if Mark's told the truth, then he hasn't actually been paid 'an income' for at least two months.

Q2. if yes, by whom ? [sic] - see Mark's post#1.

Q3. if yes, what % of your income ? [sic] - again see Mark's post # 1. It all seems fairly clear if you can't work out the answer to your own question SDT = 0% - if, as Mark states, he's been unemployed for the past 2 months.

Q4. if yes, when do you expect this income to cease ? [sic] Again, refer to Mark's post #1. I think he made it clear the income 'ceased' a couple of months ago.

You sound exactly like a politican SDT, ie., never ask a question unless you know the anwser, so perhaps enlighten the rest of us and tell us here exactly are you intending to go with the 'couple' of questions you directed at Mark.

I'm all for trustees exercising proper fiduciary discretion. But maybe there's some room to move in this case?

[Shed Dog Tosser]

I guess I'll have to use smaller words, and draw some pictures.

Does the MBF provide an income over a period when one can not work due to loss of Class One medical ?, an income protection function of sorts ?.

If you read Marks post the same way I do, it would appear he is receiving an income, paid monthly from the fund ?.

So, to me, it would appear he is purely trying to obtain his lump sum payment ?.

If that is the case, that does not mean the MBF board are a bunch of heartless bastards, they have a protocol to follow, or perhaps Marks situation is a new situation for the MBF Board.

So if a member in this situation is receiving an income, be it say, 60 or 70% income, and the member is claiming financial hardship, why, when they still have a reasonable income?.

What would a DHC8 Captain near the top of a seniority list earn ?, $110K ?, times 0.6 or 0.7 ?.

If no income protection is provided, why would you not just pay for normal income protection through one of the hundreds of providers ?.

I hope Mark gets what he is entitled to, and hopefully that is the whole amount, but, I have not heard any stories of them not paying genuine claims.

Perhaps you should go a re-read remoaks post, slowly.

Couple, go search the dictionary, find out what an "Idiom" is.

[rmcdonal]

Shed Dog Tosser from the AAPMBF site: Australian Air Pilots Mutual Benefit Fund
Twelve payments at the rate of 1.5% of the Nominated Capital Benefit per month.
A further 48 payments of 1% of the Nominated Capital Benefit per month.

The full $550,000 would be $8250 a month down to $5500 a month after a year.
At $385,000 (Age 56-58) the payments would be $5775 a month down to $3850 a month after 1 year.
Worst case is $275,000 (62-64) with $4125 for 12 months, and then $2750 a month after 1 year.

[scam sniffer]

Shed Dog

If you are a member of AAPMBF, you would have all your answers in your rule book.

If you are not a member one must ask, what's it to ya.

FYI. MBF pays out 1.5 % of NCB per mth for 12 months followed by 1% for up to 5 years but may after 15 mths pay balance of NCB where a loss is deemed permanent.

The reason people take this cover is because it is portable, and at the end if you've been in for over 20 years you get all your premiums back. (conditional)

You have cover for a couple of years between gigs, the quantum is not salary dependent and payouts are not conditional on other employment or subject to aggregation.

Also give an additional death cover over and above NCB starting at 1000g and going up to 200 g dependant on years of membership.

The fund is by pilots for pilots and occassional glithches aside, it does a pretty good job. Most of the board are pretty good guys.

SS

[Shed Dog Tosser]

Scam sniffer,

Am a member, have never read the rule book, but am aware of the loss of income and final pay out if deemed permanent.

Am trying to get the whole picture.

I am certain Marks financial situation is,as he has stated,dire, but, he is still receiving an income, and has been for the whole/most of this period.

So SIUYA, how do you like those apples ?.

As a member I am extremely interested in how satisfied/unsatisfied other members are, so this topic is extremely interesting.

Would it be fair to suggest that the MBF board are not holding onto Marks money for the sake of beings bastards, they are not going out to buy themselves new properties in the Hunter Valley with his benefit, it would appear they either are unable to pay due to current policy "or" they do not feel the loss of the Class One is permanent.

And I say again:

I have not heard any stories of them not paying genuine claims.

[gobbledock]

This is an unbelievable situation. Regardless of the 'who is right/who is wrong' argument, Mark seems to be in a world of hurt. Anybody who opens up so candidly in a public forum is obviously feeling the world on their shoulders.
Is it possible to start throwing the hat around a little ? MODS, what do you think ? I guess I am just asking the question..

[Waghi Warrior]

Being an MBF member I must say that I'm shocked to read Mark's post. Like someone else mentioned I haven't read the rule book either, however I have assumed that if I loose my class one medical that I'm entitled to the full payout, if the condition is permanent.

What's the go if the condition can be reversed to enable the individual to regain a class one, and the individual elects "NOT" to have the condition reversed for what ever reason ? Is the individual still entitled to the insurance payout ? Should be in my view ! Renewal time just around the corner, maybe time to re-consider and invest my money somewhere else that will do me better.

I really feel for Mark, it's a terrible way to finish a career.

GOOD IDEA GOBBLEDOCK.

[Shed Dog Tosser]

Well I would bet my left nut that there are two sides to this story and much more information possibly that has not been presented.

It would appear that Marks condition is not considered permanent by the MBF board, yet the Cardiologist is not recommending surgery, so is there a cure to this condition ?, ( recommended in his case or otherwise ), is it the only medical condition he is suffering from that would prohibit him returning to his previous level of pay within the industry ?.

Not intending on casting any doubts on Marks character, but not all members would be 100% honest, some would see the opportunity for a pay out and grab it, I am certain the MBF has dealt with that scenario before and have protocols in place to protect the organisation and genuine claimants.