(2003) 214 CLR 1
Stead v State Government Insurance Commission [1986] HCA 54
Source
Original judgment source is linked above.
Catchwords
ex p Lam [2003] HCA 6(2003) 214 CLR 1
Stead v State Government Insurance Commission [1986] HCA 54
Judgment (9 paragraphs)
[1]
REASONS FOR DECISION
Mrs B is a protected person, with dementia. The Guardianship Tribunal (GT) appointed the NSW Trustee as her financial manager on 13 October 2011. She was then aged 71. The GT made a limited guardianship order appointing the Public Guardian as her guardian on 19 June 2013. On 16 July 2010, prior to these developments, Mrs B made a will. Its terms are known.
On 13 August 2014, Mrs B's daughter, BNE, requested the NSW Trustee as manager of Mrs B's financial affairs to take action to have the will set aside on the ground that Mrs B lacked testamentary capacity. The NSW Trustee declined to take that action. BNE along with her husband, BND applied for administrative review of that decision by the Tribunal, as is permitted by s 62(1) of the NSW Trustee and Guardian Act 2009 (T&G Act). The Tribunal's function in reviewing an administrator's decision is 'to decide what the correct and preferable decision is having regard to the material then before it': Administrative Decisions Review Tribunal 1997 (ADR Act), s 63(1). In light of that decision, it must either affirm or vary or set aside the decision under review.
The Tribunal affirmed the Trustee's decision: BND & BNE v NSW Trustee & Guardian (2 February 2015, ex tempore decision). BND and BNE now appeal pursuant to s 80(2)(b) of the Civil and Administrative Tribunal Act 2013 (NCAT Act). In the case of a final decision of the present kind, the appeal may be made:
(b) … as of right on any question of law, or with the leave of the Appeal Panel, on any other grounds.
The respondents to the appeal are the NSW Trustee and Guardian (first respondent, the Trustee) and BNE's sister, CNF (the second respondent), who is opposed to the request of her sister and brother-in-law. (In the reasons that follow, we will simply refer to the family members as Mrs B, D, E and F.)
[2]
Background
The evidence before the Tribunal and the material provided to the Appeal Panel shows that Mrs B's 2010 will is consistent with previous wills in that, subject to a gift of a ring to F, the estate is to be divided equally between the two daughters, E and F. The feature of the 2010 will which is at the heart of D and E's concerns is Mrs B's appointment of her accountant (Mr Pines) as her executor. The execution of the will was one of a series of steps relating to her financial affairs that Mrs B took on 16 July 2010.
The other steps related to the management of her financial and guardianship needs while she remained alive. She revoked her previous enduring power of attorney given in 2003 to her daughters, E and F, under which they had been authorised to act if she suffered loss of capacity through unsoundness of mind. She appointed her accountant as her attorney under an enduring power of attorney to operate immediately. She also revoked an appointment she had made on 30 October 2009 appointing daughter E as her enduring guardian with decision making functions relating to accommodation, health care and the giving of substitute consents for medical and dental treatment if Mrs B could no longer personally do that. In place of that arrangement, Mrs B made a new enduring guardianship appointment along similar lines, substituting daughter F as sole guardian. These instruments are now superseded by the appointments given to the NSW Trustee and Guardian. The will remains unaffected.
The GT made its financial management order of 2011 against the background of family conflict about future management of Mrs B's needs. In its reasons the GT referred to E's submissions. It noted that E had described the events that took place on 16 July 2010 as 'a co-ordinated effort to deceive' her mother into doing what she did. She made a number of criticisms of the accountant, especially as to changes that she saw as retrograde in relation to her mother's financial arrangements. She expressed concern over the width of discretion that the enduring power had given him. The GT did seek to ascertain what Mrs B's likely wishes were regarding the future management of her financial and guardianship needs:
[Mrs B] wishes for Mr Pines [the accountant] to continue to look after her financial matters. She said that [D, E's husband, and the first appellant in these proceedings] has caused her upset and she does not want him to manage her affairs. [Mrs B] said that she not want to see her family fighting and wishes for her family to get along.
At annual reviews of the order in 2012 and 2013 D and E pressed the view that the order should be varied, and they be appointed as joint financial managers (see reasons, 4 July 2012, 30 August 2012, and 30 January 2013).
At our hearing D expressed similar concerns as to what the accountant might do when he is called on to exercise discretions as executor of the will.
In its decision in 2013 to appoint the Public Guardian as guardian, the GT rejected separate requests from D and E to be appointed sole guardian. The Tribunal considered that neither was suitable because of the need to preserve family relationships and the significant difficulties in effective communication between E and F. The Tribunal decided that an 'independent and neutral' guardian needed to be appointed.
The history given above is not found to the same degree in the decision of this Tribunal now on appeal (reasons were given ex tempore). We have set this history out in greater detail to provide an understanding of the broader context that underpins the present proceedings.
[3]
Administrator's Decision
On 13 August 2014 E requested the Trustee to challenge the 2010 will. In support, and in line with what she said to the GT in 2011 and subsequently, E alleged that it had been arranged fraudulently by the accountant with the assistance of her mother's solicitor (Mr Edmunds). The Trustee declined to act, stating that it was not a function of a financial manager to challenge a will, and also referred to an office policy that contests in relation to estates are best left to be resolved after death of the protected person. She exercised her right to have the decision internally reviewed. The internal reviewer confirmed the primary decision, but gave broader reasons (9 September 2014).
The internal reviewer's reasons for decision made three points:
1. They acknowledged E's submission that in its 2011 decision the GT had expressed significant doubt about Mrs B's capacity, as at 16 July 2010, to grant the power of attorney and the enduring guardianship appointment. They noted that the GT did not make any comment in relation to such matters as testamentary capacity, or reply to any allegations of misconduct by Mrs B's professional advisers (the accountant and the solicitor).
2. They then referred to the Supreme Court's jurisdiction under ss 18ff of the Succession Act 2006 to authorise a will to be made, altered or revoked for a person without testamentary capacity. The Court is not given a broad discretion to do as it sees fit. It 'must' refuse leave to make an application for an order under section 18 unless five matters listed there are demonstrated. The first of those matters is the likelihood that the testator may have lacked testamentary capacity. If that is demonstrated the second matter and the one most relevant to this case is that the court must then be satisfied that 'the proposed will, alteration or revocation is, or is reasonably likely to be, one that would have been made by the person if he or she had testamentary capacity'. We will not detail the other matters, which go to the nature of the interest of the applicant.
3. They concluded that the Trustee had no evidence of any fraud, and without such evidence it 'will not take any action that would be of considerable expense to the estate of [Mrs B]'.
D had joined in the application at the internal review stage. D and E were informed of the rights to apply for review by this Tribunal. All of the material to which we have referred above was before the Tribunal. The Trustee, as the administrator, provided the Tribunal with a folder of relevant material in its possession as required by s 58 of the ADR Act. The appellants provided detailed material in support of their case.
[4]
The Tribunal's Reasons
As they have not been published generally, we will give a fuller account than is usual of the Tribunal's reasons.
The Tribunal began by referring to the nature of the Trustee's duties, and the guiding principles set down by the T&G Act in relation to the exercise of the Trustee's functions. It highlighted the first of the principles in s 39, i.e. '(a) the welfare and interests of [protected] persons should be given paramount consideration'. The Tribunal referred to the NSW Trustee's submissions. The same submissions were reiterated on appeal. They accord with the reasons of its internal reviewer.
The Tribunal summarised D's submissions. D referred to the size of Mrs B's estate, which he estimated at $3m. D had questioned any suggestion that the taking of proceedings would lead to a significant depletion of the estate. The Tribunal noted D's concern that the accountant could benefit one party and not the other, and choose not to distribute the estate promptly or do so in a manner that was disadvantageous to one party. On the other hand F supported the decision of the Trustee, and said that her mother's estate should be used solely for her mother's needs and not for challenging the will.
The Tribunal then referred to the material upon which the Trustee relied; the first being a letter to the Legal Services Commissioner by the solicitor responsible for drawing up the will, Mr Edmunds (who had been the subject of a complaint to the Commissioner by D and E). Mr Edmunds's letter stated that Mrs B attended his office on 14 and 16 July 2010 to make her will, and showed no signs of disorientation.
The Tribunal noted Mr Edmond's account in that letter of his extensive experience in the aged sector, and his familiarity with the Capacity Toolkit published by the Attorney General's Department, and the capacity guidelines published by the Law Society. Mr Edmond gave a positive account of Mrs B's manner and appearance at the time she presented to have her will done.
The Tribunal noted D's submission that the GT had heard evidence from both the accountant and E. In relation to the accountant's past conduct, D considered that the Tribunal had ignored the evidence that the accountant had actively advised Mrs B to change her 2009 will. He referred to the transcript of the 2011 hearing.
The Tribunal concluded that 'to make a finding of fraud, I would need to be comfortably satisfied that the evidence substantiates such a serious allegation'. The Tribunal was not prepared to make such a finding.
F, E's sister and the second respondent to this appeal, did attend the Tribunal hearing and gave evidence. D cross-examined her. The Tribunal expressed itself satisfied with F's evidence, regarding her as a 'generally reliable and truthful witness'.
The Tribunal summed up, and referred to discretionary considerations that favoured the conclusion that the Trustee's decision should be affirmed. The Tribunal referred to the diminution of the estate that would result from legal proceedings, even though it accepted that this was a less significant factor in relation to an estate of some magnitude. The member concluded that 'there is no clear evidence' that Mrs B lacked capacity at the relevant time. The member drew attention to the guiding principle that 'the freedom of decision and freedom of action of such persons should be restricted as little as possible' (s 39(b)). The Tribunal also referred to the guiding principle at s 39(e): '(e) the importance of preserving the family relationships … of such persons should be recognised'.
[5]
Appeal Grounds
Under s 80(2)(b) of the NCAT Act, the appellant has a right to appeal on any question of law. The appellants' notice of appeal listed a number of matters that were seen as raising questions of law. In addition, under s 80(2)(b), the appellant may apply for leave to extend the appeal to any 'other grounds', i.e. grounds that do not involve questions of law. The appellants sought leave to extend the appeal to other grounds. If a ground that asserts a 'question of law' does not, on closer scrutiny, involve a question of law, or if a question of law is identified but no error of law is found, it follows, we consider, that the ground remains open to pursued as an 'other ground' subject to leave being granted for that purpose. We have approached the consideration of the appeal grounds on that basis.
The notice of appeal has 16 grounds of appeal, and many of them included detailed submissions and references to material such as the proceedings in the GT in 2011, and evidence considered there. (At the appeal hearing in accordance with a direction given when the matter was listed for hearing, the Appeal Panel contacted E by telephone and she confirmed that she wished to have D appear as her agent on her behalf.)
At the appeal hearing D made a number of criticisms of the Tribunal's reliance on Mr Edmunds' letter to the Legal Services Commissioner. He drew attention to the medical evidence he had tendered, and the Tribunal's statement that it showed that Mrs B had 'mild to moderate dementia' at the about the time she made the will (neuropsychological assessment, Dr Lucas, 3 August 2010; and to similar effect, a geriatrician's report, Dr Walsh, 30 September 2010). He disputed the Tribunal's statement that Mr Edmunds' letter had not been challenged. He expressed concern as to why Mr Edmunds had not arranged for Mrs B to be checked by an appropriate treating doctor before she made the new will. He referred to a request for an assessment of capacity made by her treating doctor when she visited the doctor on 15 July 2010. He submitted that the Tribunal's account of the evidence of F was not a fair one, and that the Tribunal 'wasn't familiar with the entirety of [F's] activities'.
In our opinion the 16 grounds said to raise questions of law may be grouped as follows:
1. Late Receipt of Submissions. The appellants claim that they were denied procedural fairness when the Tribunal proceeded with the hearing when it had not received any of their submissions, which they had filed for the hearing in accordance with the timetable, prior to the hearing and did not state this until after the lunchtime break (the hearing took a day). They submit that it would have been impossible to read all the material and develop an adequate understanding of the facts and issues of the appeal in the short period that she had the material. The concern raised is that the Tribunal did not properly take them into account (Ground of Appeal (GA) 1). It was asserted that this led to the Tribunal not canvassing a range of matters raised there, in relation to the state of Mrs B's capacity in July 2010 (GA 2).
2. Evidence Summonses Issues. The refusal to grant a summons (or subpoena) to procure the attendance of the solicitor, Mr Edmunds, at the Tribunal hearing. This meant, it is asserted, that the fraud case could not be proved (GA 3). The refusal to grant a subpoena to procure the attendance of the accountant, Mr Pines (GA 15). The appellants referred to an administrative error by the Registry of the Tribunal in failing to inform D promptly that a subpoena had been granted on 21 January 2015, allowing D to compel production of a copy of the 2008 will from E. The Registry only informed the appellants of the grant of the summons on 9 February 2015, seven days after the hearing had been held. D and E submit that they were unfairly deprived of the opportunity to place the 2008 will before the Tribunal and the Tribunal did not have it to consider (GA 16).
3. Tribunal's Use of Evidence: The Tribunal, it was asserted, wrongly took into account a revoked will of 1996, which had no relevance to the matters in issue (GA 4); accepted the evidence of the Trustee that there was no lack of capacity despite the Guardianship Tribunal's later consideration of this area of dispute, and its decision to place Mrs B under protection (GA 5); had inappropriate regard to the desirability of preserving relationships, when it did not test the issue or the history of the conflict (GA 6); gave inappropriate weight to the Trustee's assessment of the prospects of success, when it failed to assess most of the evidence given by E and D (GA 7); similarly, gave inappropriate weight to the decision on internal review when it stated there was no evidence of fraud, when it had been provided to the review and not considered (GA 8); and gave inappropriate weight to Mr Edmunds' evidence. The appellants referred to medical evidence other than that referred to by the Tribunal in its reasons, in particular Mrs B's attendance at a doctor's office on 15 July 2010, and query why Mr Edmunds did not obtain a testamentary capacity certificate at that point (GA 9). They raised further criticisms in relation to the Tribunal's failing to deal closely with and assess the events of 15 July 2010, the day before the execution of the will (GA 10). They assert that the Tribunal erred in law in finding F a truthful witness, giving various reasons (GA 11). They raised similar criticisms in relation to reliance on Mr Edmunds' letter to the Legal Services Commissioner (GA 12). Further criticisms were raised of the Tribunal's conclusion as to the extent of Mrs B's capacity at the time of execution of the will, and undue reliance on the letter of Mr Edmunds when there were findings in other proceedings, such as the GT proceedings of 2011 and 2013, arguably to a different effect (GA 13). They raised further criticisms in relation to the Tribunal misconstruing the scope and effect of the 2010 will as compared to the earlier will (GA 14).
We do not have a transcript of the proceedings before the Tribunal, as the parties to appeal chose not to obtain one. In preparing these reasons, we have reviewed the material on the Tribunal's file of the proceedings which includes a number of the documents to which the appeal grounds refer.
[6]
Adequacy of Reasons
The question of law that we see most of the grounds raising is that of adequacy of reasons, i.e. all the grounds summarised under (3) above.
Administrative Review in relation to the affairs of Protected Persons. Before dealing with that issue we should make some general observations on proceedings of the present kind.
It is apparent from the papers and the history we gave at the beginning of these reasons that there is a significant difference within the family as to the appropriateness of the change made by Mrs B in relation to the executor clause of her will. It may be, as asserted by the appellants, that the significance of this change cannot be fully understood by looking only to that material that is in evidence. They referred to contemporaneous medical assessments that were not referred to by the Tribunal. They also say that Mrs B's estate includes property trusts and that the accountant remains a trustee in relation to those trusts. The appellants are concerned that after Mrs B's death that, in combination, the discretions said by them to be reposed in the accountant as trustee of those trusts and those given to him as executor of the will, might lead to the administration of the estate in a way that is unfavourable to their interests .
As we see it, the vehicle of an administrative review application to this Tribunal is not the place ordinarily, for an exhaustive examination of issues of these kinds. The scope of a Tribunal's administrative review inquiry will be affected by the nature of the controversy, the nature of the functions given by the relevant law to the administrator, and considerations of efficiency, timeliness and proportionality (see, for example, NCAT Act, s 36(1), s 36(4)). Moreover, administrative review applications relating to decisions concerning protected persons should be conducted in a way that reflects the guiding principles set out in the T&G Act at s 39, in particular (a), that the paramount consideration in guardianship decision-making is the welfare and interests of the protected person.
Great care must be exercised, we consider, before concluding that the preferable approach to the resolution of a controversy within a family over the management of an estate of a protected person is for the trustee to undertake legal proceedings. In this instance, the proceedings contemplated are Supreme Court proceedings where the legislative direction is, in essence, that the sanctity of the will only be disturbed in very narrow circumstances. As we noted earlier, it is not enough to establish a probable case of testamentary incapacity. The court must also be satisfied as to a number of other matters, the most relevant of which in this case is that the change sought is reasonably likely to have been one that the testator would have made had she possessed capacity. Further, even greater care needs to be exercised in relation to proposed litigation where the central allegations are ones of fraud or other corrupt conduct and are directed to members of professions with special ethical obligations. Obviously, there is the further considerable difficulty that the protected person may not be capable of giving any relevant evidence; and, even where that might be possible, the deleterious effect any involvement of that kind might have on his or her health and welfare.
Scope of Duty to Give Adequate Reasons. For a recent summary of what is entailed by the duty to give adequate reasons by a court: see Baker v David [2015] NSWCA 235 (18 August 2015) per Young AJA at [24]:
In Whisprun Pty Ltd v Dixon [2003] HCA 48; 77 ALJR 1598 at [62]- [63] Gleeson CJ, McHugh and Gummow JJ described the trial judge's obligation properly to consider a party's case as a "paramount judicial duty". That does not mean that the judge has to deal with every argument and issue that might arise in the course of a case. However, "where an argument is substantial or an issue is significant, it is necessary to refer to and assign reasons for the rejection of the argument or the resolution of the issue": per Nettle JA (Batt and Vincent JJA agreeing) in Hunter v Transport Accident Commission [2005] VSCA 1; 43 MVR 130 at [21]. As McHugh JA said in Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 at 279, one of the purposes which the obligation to give reasons serves is that of enabling the parties to see the extent to which their arguments have been understood and dealt with. In some cases a complaint of inadequate reasons may obscure the party's real ground of complaint which is that the court has not addressed a significant or substantial issue: see Gordon v Ross [2006] NSWCA 157 at [81] per Basten JA.
See also Resource Pacific Pty Ltd v Wilkinson [2013] NSWCA 33 esp per Basten JA at [40] ff. As Basten JA noted at [48]:
When an appellate court is invited to find that a trial judge provided inadequate reasons, it is important to understand the nature of the function being invoked. It is not the function of an appellate court to set standards as to the optimal, or even desirable, level of detail required to be revealed in reasons for judgment. Rather it is to determine whether the reasons provided have reached a minimum acceptable level to constitute a proper exercise of judicial power. Transparency in decision-making is an important value, but it is not cost free, and may involve separate parameters of quantity and quality
The same principles apply to decisions of the Tribunal at first instance: see, for example, Sikka v Roads and Maritime Services (GD) [2013] NSWADTAP 28 at [18]; and Collins v Urban [2014] NSWCATAP 17; see also, NCAT Act s 62(3).
Consideration. In our view, on the basis of the material before us and having regard to the approach we see as appropriate in this field, the Tribunal undertook an appropriate level of examination of the material upon which the appellants sought to rely.
In our view, the Tribunal addressed the central issue raised by this case, whether the administrator's decision to refuse the appellants' request remained the correct and preferable one. It considered the material relied upon by the appellants. It resisted, we think appropriately, an escalation of the proceedings in a way that would have led to a collateral inquiry into the events of July 2010, when similar concerns had already been extensively canvassed at two GT hearings (albeit not specifically addressed to the making of the will). The Tribunal's reasoning was, we consider, adequately exposed to the appellants. The Tribunal addressed the main points raised by the appellants as justifying a decision to challenge the will. It had similar concerns to those raised by the Trustee. We do not therefore propose to deal any further with the particular points raised by the grounds we have gathered together at point (3). There is no error of law identified.
[7]
Procedural Fairness
The grounds gathered together at points (1) and (2) relate to the Tribunal's management of the proceedings at and prior to hearing. We will deal first with point (2) which concerns the pre-hearing stage.
We do not have any details as to the process of reasoning used by the Tribunal member in refusing to grant the attendance summonses sought in relation to the accountant (Mr Pines) and the solicitor (Mr Edmunds). There will, we recognise, be cases where it is important to a fair determination of the review application that witnesses be required to attend. In administering requests for summonses, the central issue is whether the applicant for the summons has demonstrated that a legitimate forensic purpose is served by the issuance of the summons. In our view, there was sufficient material before the Tribunal to enable a fair determination to be reached without the need for evidence to be given orally by the two advisers. The Tribunal could reasonably have concluded, we think, on the substantial material that already existed in relation to the issues in dispute that no legitimate forensic purpose was to be served in having Mr Pines and Mr Edmunds attend.
The Tribunal did grant the appellants a summons for production of the 2008 will. We accept that there was a Registry error of the kind referred to at GA 16, i.e. the Registry did not notify them that the summons had been granted 12 days before the hearing until a week after the hearing. The 2008 will was, in our view, at the periphery of the issue before the Tribunal i.e. whether to substitute a decision that would require proceedings to be taken in the Supreme Court in relation to the making of the 2010 will. Had the 2008 will been provided in advance we consider that it would have made no difference to the Tribunal's consideration of the issues and its determination: see Stead v State Government Insurance Commission [1986] HCA 54; (1986) 161 CLR 141 at [8]-[10].
As to the grounds gathered together at point (1), while (in the absence of a transcript) we are unable to verify the appellants' account, we will accept it for present purposes. Written submissions are an important component of proceedings, but so is the oral hearing. Here there was an oral hearing of several hours, and the record shows that fourteen documents were received into evidence, and given exhibit numbers, ten from the applicants and four from the respondents. While the written submissions were received at a later stage than might have been ideal, we are not satisfied that that difficulty gave rise to any failure to accord procedural fairness. The central precept of procedural fairness is that the parties be given a fair hearing, in which they receive an adequate opportunity to be heard. We note further that, though the reasons were delivered ex tempore after the close of the hearing, they are relatively extensive and deal carefully with the main points of concern. As emphasised by Gleeson CJ in Re Minister for Immigration and Multicultural Affairs; Ex parte Lam [2003] HCA 6; (2003) 214 CLR 1
Fairness is not an abstract concept. It is essentially practical. Whether one talks in terms of procedural fairness or natural justice, the concern of the law is to avoid practical injustice.
Overall Conclusion: We are not satisfied that any errors of law have been identified by the questions of law that might be seen to arise from the grounds of appeal.
[8]
Leave to Consider Other Grounds
That brings us to the question of whether we should grant leave to allow the various matters of concern raised in the 16 grounds of appeal to be pursued as other grounds, i.e. ones that do not involve a question of law.
In effect, the grounds challenge the particular findings that the Tribunal made as to matters of fact, matters of credibility and its balancing of discretionary considerations. Were we to enter into those areas, we would in effect be reopening the Tribunal's decision to a full reconsideration.
We consider that it is not in the interests of Mrs B to grant leave. Moreover, the appellants have alternative remedies available to them if they wish to pursue their grievances. They can pursue personal proceedings, with the risks that those proceedings carry, in relation to the very serious allegations that they are making about the conduct of the two advisers to Mrs B. After her death, they can contest the probate of the will if they remain concerned about its validity. An executor and trustee has well-known fiduciary duties in relation to the administration of a deceased estate.
Leave to extend the appeal to other grounds is refused.
[9]
Order
Appeal dismissed.
I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.
Registrar
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 14 October 2015