Anson v Anson [2005] NSWSC 566 | Case summary

19/05 LOUISE GELL v MICHAEL GELL JUDGMENT 1 HIS HONOUR: Significant amendments have been made to the Protected Estates Act 1983 ("the PE Act") by the Protected Estates Amendment (Missing Persons) Act 2004. That latter Act commenced on 17 December 2004. As this is the first application under the amendments made by it to the PE Act it is appropriate to deliver a judgment which considers some of the aspects of the amendment to the PE Act, and amendments to the Supreme Court Rules 1970 which have been made to implement those amendments to the PE Act. 2 The application is one in which I made declarations and orders in chambers on 2 June 2004 after the defendant had not appeared when the matter was listed before the Registrar. I made orders appointing the plaintiff as manager of the estate of the defendant, and certain consequential orders, on the basis that I would deliver reasons later. Since the orders were made, Young CJ in Eq has also made orders in another case under the new provisions and delivered reasons: Re Flint [2005] NSWSC 560. The Legislative Provisions 3 The PE Act now contains, in section 4, a definition of "protected missing person" as "a person in respect of whom an order is in force under Division 1A of Part 3 that the estate (or any part of it) of the person be subject to management under this Act." A "protected missing person" is expressly excluded from the definition in section 4 of "protected person". 4 A principal provision introduced by the new legislation is section 21C PE Act. It is the only section in Division 1A of Part 3 of the Act. It provides: " 21C Declaration and order where person missing (1) The Court may declare that a person is a missing person and order that the estate of the person (or any part of it) be subject to management under this Act if the Court is satisfied that: (a) the person is a missing person, and (b) the person's usual place of residence is in this State, and (c) it is in the best interests of the person to do so. (2) The Court may be satisfied that a person is a missing person only if it is satisfied that: (a) it is not known whether the person is alive, and (b) all reasonable efforts have been made to locate the person, and (c) persons residing at the place where the person was last known to reside, or relatives or friends, with whom the person would be likely to communicate, have not heard from, or of, the person for at least 90 days. (3) An application for a declaration and order under this section in relation to a person may be made by any of the following persons: (a) the spouse of the person, (b) a relative of the person, (c) a business partner or employee of the person, (d) the Attorney General, (e) the Protective Commissioner, (f) any other person who has an interest in the estate of the person. (4) On the hearing of an application for the purposes of this section, evidence may be given to the Court in such form and in accordance with such procedures as the Court thinks fit." 5 An applicant for a declaration and order under section 21C must prove each of the matters listed in section 21C(1)(a)(b) and (c). I will consider them in turn. Generally, though, it can be said that the making of a declaration and order under section 21C is a serious matter. The fact that the declaration and order is made when the missing person is not in a position to present evidence or tell the Court his or her views about the appointment, and that the declaration and order can irretrievably affect his or her property, means that the Court is unlikely to be satisfied by slight proofs. In cases of particular doubt or difficulty the Court would have power to arrange for someone to represent the missing person for the purposes of the litigation. Section 21C(1)(a) - "the person is a missing person" 6 The Act does not contain any definition of "missing person". Thus, the Court must approach the question of whether a person is a "missing person" in light of the ordinary English meaning of that phrase and the purpose of the legislation. However, section 21C(2) prohibits the Court from finding that a person is a missing person unless it is satisfied of each of the three matters listed in section 21C(2). That does not mean, however, that proof of the three matters listed in section 21C(2) will necessarily be enough to establish that the person is a "missing person". As well, ordinarily evidence would be needed of the circumstances in which the person has disappeared, including his or her condition during the period immediately before the disappearance, and material which casts light on any motive the person may have had to disappear, or on any other possible cause there might be for his or her disappearance. The mere fact that a person has not been seen by people who would ordinarily see him or her is not enough to show that that person is a "missing person" - it is quite consistent with the person being on a holiday. More context is needed to conclude that the person is indeed a "missing person". 7 The requirement in section 21C(2)(a) that "it is not known whether the person is alive" is, unhelpfully, expressed in the passive voice. It provokes the question "not known by whom?". When a statute is imprecise in this way, correct construction of the statute does not necessarily require that only one answer be given to that question. In the context, it seems to me that the people whose lack of knowledge of whether the person is alive needs to be established are people who ordinarily would be expected to have seen, or to have heard from, or of, the person. Given that missing people are ordinarily reported to the police, who then come under an obligation to find out what they can about the whereabouts of the person, in practice that will usually include also that part of the police force whose task it is to investigate the whereabouts of missing people. The NSW Police force has a Missing Persons Unit which specialises in locating missing people 8 Establishing what is required under section 21C(2)(a) (and also establishing what is required under section 21C(2)(c)) will require some identification of who are the people with whom the person would be likely to communicate. To satisfy section 21C(2)(a), the applicant also needs to establish that those people do not know whether he or she is alive. Section 21C(4) permits evidence to be given somewhat informally, if the Court thinks appropriate. It may be appropriate, in cases where the enquiries have been of a kind such that it is impractical to expect an affidavit from everyone of whom enquiry was made, for the person or people who made the enquiries to state in an affidavit what enquiries were made, of whom, and what their responses were, and saying that the deponent believes that those responses are correct. 9 Proof that it is not known whether the person is alive involves proof that it is not known that the person is dead. Results of police enquiries will in many cases go a long way, and perhaps all the way, to satisfying this requirement, but again the facts of the individual case need to be looked to to decide what is sufficient to satisfy the Court that it is not known whether the person is dead. Sometimes, evidence of a physical search being carried out in the area where the person disappeared, or where there is reason to believe the person has gone to, and failure to find, or hear news of the finding of, the dead body of the person may be appropriate. 10 The requirement in section 21C(2)(b) will require evidence to be given concerning what efforts have been made to locate the person. It would be a most unusual case for the Court to be satisfied that a person was missing if the police had not been informed of the disappearance. Ordinarily, the evidence on an application will include evidence of when, and in what circumstances, the police were informed of the disappearance, and of the present state of knowledge of the police concerning that person. Section 21C(4) would permit such evidence to be given by the tender of an original letter from the appropriate part of the police force, stating those matters. What else would be needed for the Court to be satisfied that "all reasonable efforts" have been made to locate the person will depend to some extent on the circumstances of the case. However, reasonable efforts to locate a missing person sometimes include (apart from making enquiries of the kind necessary to satisfy section 21C(2)(c)) seeking publicity in the media concerning the missing person, and going to places they usually frequent and enquiring whether anything has been heard or seen of them. There is a National Missing Persons Unit, which co-ordinates the activities of the various Australian police forces and other organisations like the Salvation Army and the Red Cross which have an interest in locating missing persons. Its internet website (www.missingpersons.gov.au) lists and describes missing persons whose family consent to the listing. Consenting to that listing, unless there was good reason not to, could be part of making "all reasonable efforts". Other organisations like the Salvation Army Missing Persons Bureau, or the Australian Red Cross Tracing Unit might, in some circumstances, be appropriate ones to also seek help from. Some information on available help in finding missing persons can be found at www.police.nsw.gov.au/community_issues/missing_persons. 11 In section 21C(2)(c) the phrase "with whom the person would be likely to communicate" describes both "persons residing at the place where the person was last known to reside", and "relatives or friends". Thus, if the person resided at a place where numerous people resided, but only some (or perhaps none) of those people are ones with whom the person would be likely to communicate, it is only those with whom he would be likely to communicate that section 21C(2)(c) applies to. Similarly, section 21C(2)(c) does not apply to any relatives or friends with whom the missing person would not be likely to communicate. 12 The expression "with whom the person would be likely to communicate" does not, in my view, extend to every fellow resident or relative or friend with whom the missing person from time to time communicates in the ordinary course of daily life - there could be scores of such people. Rather, it seeks to identify the people with whom the person would be likely to communicate if he or she were indeed alive, had been missing, and had access to the ordinary means of communication. It recognises that ordinarily, if a person goes missing, certain people are likely to worry or wonder what has become of him or her, and that the missing person would be likely to contact one or more of those people if he or she were able. 13 However, on some occasions people quite deliberately make themselves disappear, sometimes with the intention of starting a new life. The caution which the legislation requires before an order is made could be compromised if the Court came to the view that the likelihood was that a particular person had deliberately disappeared, and therefore would be likely to communicate with nobody, and therefore no evidence of enquiries to establish section 21C(2)(c) is needed. Rather, giving effect to the policy and purpose of the legislation seems to me to require that the enquiry in section 21C(2)(c) proceed on the assumption that the person in question is not making himself or herself disappear deliberately. Section 21C(1)(b) - "the person's usual place of residence is in this State" 14 The second element in section 21C(1) is largely self explanatory. It will involve giving evidence of where the person resided, and of the circumstances of his or her residing there, over a sufficiently long period to make it clear that the person's "usual place of residence" is in NSW. If the person has been physically present in NSW for only a short time before going missing, it may well be relevant whether the place he or she resided was a home that he or she owned or rented or the home of a relative, rather than a place like a hotel which is more commonly lived in by transients. Having social and business connections in NSW - like a family, a job, or a business - could also sometimes cast light on whether the person's usual place of residence was in this State. 15 A declaration and order made by the Supreme Court of NSW under section 21C would be accorded full faith and credit within Australia (Re DEF and the Protected Estates Act 1983 [2005] NSWSC 534). The same applies if a court upon which the jurisdiction of the Supreme Court of NSW is vested under the Jurisdiction of Courts (Cross-vesting) Act 1987 makes such a declaration and order. However, applicants should bear in mind the possibility that recognition of the declaration and order by a court outside Australia might possibly require a stronger personal connection between the missing person and NSW than that of "usual residence", and might require proof that the person was domiciled in NSW (cf Nygh, Conflict of Laws in Australia, 7th ed (2002) p. 572-575), if the foreign court is prepared to recognise at all a juristic novelty such as the one that section 21C establishes. This question is really one dependent on the law of the country in which recognition of the declaration and order is sought, and so is not one concerning which I can usefully say any more. Section 21C(1)(c) - it is in the best interests of the person to make the declaration and order 16 The third element in section 21C(1) will depend, again, on the particular circumstances of the person who is missing. Obviously preservation and maintenance of the property of the missing person, and dealing with the business affairs of the missing person in a way best calculated to preserve, maintain, or possibly enhance the assets of the missing person, is part of what is within the scope of his or her "best interests". However, "best interests", in this context in the PE Act, goes wider than that. 17 Assistance can be gained in deciding what count as "the best interests" of the missing person by considering the consequences which the PE Act provides when the Court makes an estate subject to management. They include applying the whole or any part of the estate of the protected missing person towards, "… the maintenance of the spouse of the … protected missing person or any child, parent or other person dependent upon the … protected missing person, or for whose maintenance the … protected missing person provided when not a … protected missing person or would be expected to provide." (section 28(1)(c)). 18 They also include purchasing real estate if it appears to the Protective Commissioner to be desirable for the purpose of "providing a home for … any dependents of the … protected missing person." (Section 28(2)(c)). If a private manager is appointed, the Court is empowered to make the property and income of the protected missing person available for "the maintenance and benefit of the family of the protected missing person." (section 32(1A)(b)). When the PE Act itself provides for these types of task to be carried out by the manager, using the estate of a protected person, and when a manager can be appointed only when it is the best interests of the person to do so, that is a strong indication in the statute itself that these types of task which the manager can perform are ones which are part of what count as "best interests" of the person. 19 The second reading speech of the Attorney-General, Mr Debus, in the Legislative Assembly explained a purpose of the new legislation as follows: "Presently, family or friends can only manage the affairs and estates of missing people after obtaining a grant of probate from the Supreme Court. This means the missing person is presumed to be dead. Unless there is strong evidence that the person has died, probate may not be granted until they have been missing for seven years. The presumption of death process is particularly distressing for families and friends of missing people because they usually do not want to accept, let alone prove, that the person is dead. It is also unsuitable for the majority of missing people, who are subsequently found alive. The process takes too long to provide any practical, timely assistance to people wishing to look after an estate in the short or medium term. More than 8,000 people go missing in New South Wales each year: 70 per cent are found within three days, 86 per cent are found within two weeks and 99.7 per cent are located overall. Long-term missing people are those who have been missing for more than a year. In New South Wales there are more than 500 long-term missing people. The Government, in consultation with families and friends of missing people, has developed a clear and simple legal procedure for applications to be made to allow others to manage property belonging to missing people." ( Hansard , Legislative Assembly, 20 October 2004, page 11683). 20 The new legislation does not permit distribution of the estate of a missing person in the way which is possible after a grant of probate or letters of administration is made on presumption of death. Rather, it permits a limited kind of use of the property of the missing person, of the kind the missing person would be likely to approve if he or she could be consulted, to protect, preserve and advantageously deal with that property, and to support the family of the missing person. 21 Section 21C(1) confers power on the Court to order that either the entire estate, or only part of it, becomes subject to management. In considering whether it is in the best interests of the missing person to make an order, the Court will take into account whether it is in the best interests of the person to have an appointment made in relation to the whole of the estate, or only of part of the estate. An inherent disadvantage in the appointment of a manager is that fees become payable in connection with the management. The Protective Commissioner has power under section 8 PE Act to charge fees for the exercise of his functions. Those fees differ depending upon whether the Protective Commissioner is appointed as manager of the estate, or whether a private manager is appointed. Even if a private manager is appointed, the Protective Commissioner exercises a supervisory role over that private manager, and is entitled to charge fees in connection with those supervisory tasks. The present fee is a flat fee for the filing, examination and passing of the private manager's accounts, and a percentage of the net income of the estate. While a private manager is expected to act gratuitously unless the Court otherwise orders, the Court has power under section 77 PE Act to permit a private manager to charge remuneration. As with all orders where the Court permits someone undertaking a fiduciary task to charge fees for carrying out the task, the Court needs to be persuaded that there are circumstances that make it appropriate for an order to be made which permits a private manager to charge fees for acting as manager: cf Anson v Anson [2004] NSWSC 766 at [75] - [78]. Professional private managers will usually not consent to being appointed unless they are entitled to charge. 22 If the Protective Commissioner is appointed as manager, he has a statutory right to charge fees, and to charge higher fees than those applicable if the Protective Commissioner is merely supervising a private manager. 23 Thus, one way or another, fees are payable in connection with an appointment, and the quantum of those fees is related to the size of the estate which is under administration. It follows that if there is some part of the estate of the missing person which does not need to be brought under administration, it could be wasteful to include it in an administration order. Including an asset in an administration order does not necessarily increase the costs of administration, however - eg if a private manager is appointed who acts gratuitously, and the asset in question is one which does not earn income, like the family home of the missing person, in which his or her family continue to reside. The evidence relating to whether the appointment is in the best interests of the missing person will need to provide some basis for the Court to decide whether there is a need to have a manager appointed of the whole estate, or only of part, and if so what part. Who Can Apply for an Order? 24 The potential applicants for an order are listed in section 21C(3). Section 4 PE Act gives an extended definition of "spouse" as extending to the other party to a de facto relationship. 25 There is no definition of "relative", a term which appears in section 21C(3)(b), and also in section 50(1A) which deals with the Protective Commissioner's obligation to consider whether to consult relatives concerning actions in the administration of the estate of a protected missing person. While it is not an uncommon use of language to talk of a person's relatives by marriage, the usual meaning of "relatives" in a legal context is limited to blood relations: Fielden v Ashworth (1875) LR 20 Eq 410. It might not be the case that the legislature intended any blood relation of the missing person, no matter how remote the relationship was, to have the standing to make an application. It is not necessary for present purposes to make any decision about whether there are any limits to the precise degree of relationship which would be necessary to come within section 21C(3)(b). Other Procedural Matters 26 Rules of court have been made governing the new provisions in the PE Act. Proceedings must be commenced by Summons (Supreme Court Rules 1970 Part 76 rule 5(1)). The person concerning whose affairs the orders are sought must be named as a defendant, but need not be served (Part 76 rule 9(2)). The evidence on the application must include, pursuant to Part 76 rule 11(1): "(c) except where the proposed manager is the Commissioner, the Public Trustee or a trustee company, the affidavits in the prescribed form of at least two persons of the fitness of a proposed manager, (d) except where the proposed manager is the Commissioner, a consent in the prescribed form, executed by the proposed manager (except where he is also the plaintiff) and an affidavit in the prescribed form verifying the execution of the consent." 27 The prescribed form of Affidavit of Fitness of Manager is contained in Form 79 of the Forms in Schedule F to the Supreme Court Rules 1970. That prescribed form establishes an extra requirement for the Affidavit of Fitness of Manager, namely that the deponent not be related to the proposed manager. The Affidavit of Fitness of Manager must contain all of the elements of the prescribed form (which I will not set out here), unless the Court permits that requirement of the rules to be dispensed with. 28 The prescribed forms of Consent of Manager, and Affidavit Verifying Consent are set out in Form 80 (where a natural person is the proposed manager) and Form 81 (where the proposed manager is a company). 29 When a manager is appointed to the estate of a protected missing person, section 31 PE Act provides that the Court: "… may require the manager to give security, including security comprising the assets of the … protected missing person, to the Protective Commissioner in respect of the management."

Anson v Anson

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