Bovaird v Guardianship Tribunal and Ors

Supreme Court of NSW|2009-05-25|Before: Palmer J

CITATION : Bovaird v Guardianship Tribunal and Ors [2009] NSWSC 452

JURISDICTION : Equity Division Protective List

CATCHWORDS : COSTS - APPEAL - Appeal from costs order of Guardianship Tribunal - whether Tribunal's discretion miscarried in refusing to make indemnity costs orders.

LEGISLATION CITED : Family Provision Act 1982 (NSW) Guardianship Act 1987 (NSW) - s 25E, s 25I(1)(b), s 67, s 69(1)

Leon Lewis MacGillivray Bovaird (Plaintiff) PARTIES : Guardianship Tribunal (First Defendant - submitting appearance filed 02.04.08) Diana Catherine Fallon (Second Defendant) Monica Catherine Bovaird (Third Defendant)

COUNSEL : R.R.I. Harper SC (Plaintiff) N. Cotman SC (Second Defendant)

Garland Hawthorn Brahe (Plaintiff) SOLICITORS : I.V. Knight, Crown Solicitor (First Defendant) MBP Legal (Second Defendant)

1 Pursuant to s 67 of the Guardianship Act 1987 (NSW) the Plaintiff, Mr Bovaird, appeals from costs orders made by the Guardianship Tribunal in two applications made for a financial management order in respect of his mother ("Mrs Bovaird"). One application was made by the Second Defendant ("Mrs Fallon") and the other was made by Mr Bovaird himself. 2 Mrs Fallon applied for an order under s 25E of the Guardianship Act that she be appointed the financial manager of Mrs Bovaird's estate. Mr Bovaird opposed the application. On 1 March 2007, when the hearing of Mrs Fallon's application commenced, Mr Bovaird himself made an application for an order under s 25E. 3 Both applications were heard together and, on 29 August 2007, both were dismissed. 4 Mrs Fallon's application was dismissed because the Tribunal was not satisfied that she had "a genuine concern" for the welfare of Mrs Bovaird, as required by s 25I(1)(b), so that she lacked standing to bring the application. 5 Mr Bovaird's application was dismissed because, although Mrs Bovaird was clearly incapable of managing her own affairs, Mr Bovaird was already managing her affairs satisfactorily pursuant to a General Power of Attorney previously given by Mrs Bovaird. The Tribunal therefore concluded that a financial management order in favour of Mr Bovaird was not necessary. 6 On 6 February 2008, the Tribunal made costs orders in both applications. Mr Bovaird had applied for an indemnity costs order in respect of the whole of his costs of the proceedings, amounting to some $61,000, on the ground that Mrs Fallon's application was an abuse of process from the start and that his own application was in the nature of a precautionary defence. 7 The Tribunal declined to make a costs order in respect of the whole of Mr Bovaird's costs. It ordered that Mrs Fallon pay all of Mr Bovaird's costs up to the commencement of the hearing on 1 March 2007. As I have noted, until that time only one application was on foot, namely, that of Mrs Fallon. On and from 1 March 2007, there were two applications, Mrs Fallon's application and that of Mr Bovaird, made that day. 8 The Tribunal ordered that Mrs Fallon pay one-half of Mr Bovaird's costs on and from 1 March 2007: "From 1 March 2007, Mrs Fallon shall pay half of Mr Bovaird's costs. The costs to be halved include but are not confined to all costs in relation to the issues of whether the Tribunal should make a financial management order and what order it should make irrespective that such costs related to both matters …." 9 The Tribunal expressly ordered that the costs of Senior Counsel for Mr Bovaird were not to be allowed as part of the costs payable by Mrs Fallon, on the ground that the nature of the proceedings and the relatively straightforward issues did not justify the engagement of Senior Counsel as well as Mr Bovaird's solicitor. 10 Costs were ordered to be paid on the party/party basis.

11 The appeal under s 67 from the Tribunal's costs order was commenced a few days after the time for appeal under s 67(2)(b) had expired. Mr Bovaird may, therefore, prosecute the appeal only if an extension of time is granted under s 67(2)(c). 12 Mr Cotman SC, who appears for Mrs Fallon, does not consent to an extension of time but fairly and frankly says that he can point to no prejudice if the extension is granted. The reason given by Mr Bovaird for the delay in instituting the appeal is that he was overseas when the Tribunal's decision was delivered and that he did not return in sufficient time to give instructions for the appeal. That evidence is unchallenged. 13 I am satisfied that in these circumstances it is appropriate to extend the time for appeal. I order that time for filing the Summons in these proceedings under s 67(2)(c) be extended up to and including the date of filing.

14 By s 67(1), a party to proceedings before the Tribunal may appeal to the Supreme Court as of right on a question of law and, on any question, only by leave of the Court. 15 Mr Bovaird appeals from the way in which the Tribunal exercised its wide discretionary power as to costs under s 69(1). 16 Dr Harper SC, who appears for Mr Bovaird, submits that the Tribunal, having failed to form the opinion that Mrs Fallon had "a genuine concern" for Mrs Bovaird's welfare sufficient to qualify Mrs Fallon as an application for the purposes of s 25I, ought therefore to have concluded that Mrs Fallon's proceeding was an abuse of process. He says that the application was motivated by an intention to undermine proceedings which Mrs Bovaird and Mr Bovaird had, as plaintiffs, commenced against Mrs Fallon's family interests in the Supreme Court. Mr Bovaird had sought an order from the Tribunal under s 65 that Mrs Fallon's application be dismissed as frivolous and vexatious and that she pay the costs of the proceedings. 17 There are other grounds of appeal, claiming error in fact finding, but I think that an allegation that the Tribunal erred in failing to give a certain legal character to Mrs Fallon's application, namely, that it was an abuse of process or vexatious, raises a question of law for the purposes of s 67(1)(a), so that leave to appeal is unnecessary.

18 Mrs Fallon is the daughter of Mrs Bovaird's late brother, Max Frost, and she is the executor of Mr Frost's estate. At the time of Mrs Fallon's application to the Tribunal, Mrs Bovaird had commenced proceedings in the Supreme Court against Mrs Fallon, as executor of Mr Frost's estate, seeking provision for herself under the Family Provision Act 1982 (NSW). Mr Bovaird had also commenced proceedings in the Supreme Court against Mrs Fallon as executor of Mr Frost's estate and against a family company of which Mrs Fallon was a shareholder, seeking specific performance of an alleged contract to lend Mr Bovaird $880,000 for the construction of accommodation for Mrs Bovaird. By a third set of proceedings in the Supreme Court, Mrs Bovaird made the same claim in contract against Mr Frost's estate and the family company. The proceedings instituted by Mrs Bovaird were, of course, conducted by Mr Bovaird pursuant to the General Power of Attorney given to him by Mrs Bovaird. 19 Mrs Fallon had made the application to the Tribunal for a financial management order in her favour on the ground that Mr Bovaird was misusing his position under the General Power of Attorney to his own financial advantage, at the expense of Mrs Bovaird. Mr Bovaird denied those allegations. 20 In response, Mr Bovaird challenged Mrs Fallon's standing to make the application, saying that she did not have "a genuine concern" for the welfare of Mrs Bovaird. Rather, as I have noted, Mr Bovaird said the purpose of Mrs Fallon's application was to frustrate the Supreme Court proceedings. 21 The Tribunal said this about the requirement that an applicant for a financial management order have "a genuine concern" for the welfare of the patient: "1. that the applicant is bringing to the attention of the Tribunal a fact situation in which the subject person's interests may call for intervention by the Tribunal;

that the applicant is sincere in seeing the situation as one that may call for the intervention of the Tribunal in the interests of the person; and

that the application is motivated by a desire to advance the welfare of the person.

The third requirement does not necessarily mean that the applicant is only focused on the interests of the person. The intertwined lives of the person the subject of an application, their family, service providers and others around them will often mean that an applicant has a focus on their own interests or the interests of third parties as well as those of the person subject of the application. However, for the person to have a genuine concern, the interests of the person must be their primary motivation for the application.

Finally, it must be noted that the issue is whether the Tribunal forms the opinion that the applicant has a genuine concern for the welfare of the person. The Tribunal ultimately has to make a judgement whether, on the basis of the evidence, it is satisfied that it holds this opinion.

In considering whether the standing provision is satisfied, the Tribunal needs to consider all relevant circumstances. The following is a non-exhaustive list of factors that the Tribunal may find it useful to consider:

How the applicant explains the reasons for the application and the kind of orders sought, in the application and in other relevant documents and evidence.

Has the applicant taken any reasonable steps to clarify and resolve the situation before bringing it to the Tribunal?

The relationship of the applicant and the person subject of the application. Is it a family relationship, a friendship, a professional relationship or, for example, a neighbour? How longstanding and close is the relationship? Does the relationship involve any professional or other responsibility of the applicant for the person? Has the relationship been marked by positive and/or negative action by the applicant towards the person?

The views of the person in relation to the issue of genuine concern. Does the person now or has the person over time expressed views in relation to their perception of the applicant and their relationship with the applicant?

Does the applicant have a conflict of interest? Is this conflict more apparent than real?

What is the nature of any conflict of interest? Does the applicant acknowledge the conflict? How does the applicant reconcile or propose to manage the conflict?" 22 Dr Harper does not submit that this approach is wrong in law. 23 In considering whether it could form the opinion that Mrs Fallon, in bringing the application, had a genuine concern for the welfare of Mrs Bovaird, the Tribunal had regard to the following considerations:

Mrs Fallon is Mrs Bovaird's niece and "may have an affection for her" ;

Mrs Fallon had evidence that Mr Bovaird was using considerable amounts of his mother's money for his own expenses;

on the other hand, Mrs Fallon had very limited contact with Mrs Bovaird for years;

if Mrs Fallon were appointed to manage Mrs Bovaird's financial affairs, she would have a clear conflict of interest and duty in deciding how to manage the Supreme Court proceedings brought by Mrs Bovaird against Mrs Fallon's family interests;

Mr Frost's estate was paying Mrs Fallon's legal costs of the application to the Tribunal, suggesting that the application was for the benefit of the estate, not for the benefit of Mrs Bovaird. 24 The Tribunal expressed its conclusions thus: "In terms of the three ingredients of 'genuine concern for the welfare' of Mrs Bovaird that the Tribunal has set out above, the Tribunal accepted that Mrs Fallon was bringing to the attention of the Tribunal a fact situation in which Mrs Bovaird's interests may call for intervention by the Tribunal. Mrs Fallon may sincerely see the facts as calling for this intervention.

However, the Tribunal was not satisfied that Mrs Fallon's application had a primary motivation in a desire to advance Mrs Bovaird's welfare. Mrs Fallon has had very limited contact with Mrs Bovaird over time. Mrs Fallon had clear conflicts of interest and, glaringly, her application was being financed by her father's estate rather than from her own assets. The confusing nature of Mrs Fallon's evidence in relation to her father's commitment and the bond suggested a detachment by Mrs Fallon from Mrs Bovaird's interests and from a central issue in her application.

The Tribunal did not form the opinion that Mrs Fallon satisfied the test for standing, and so dismissed her application."

25 As the Tribunal's costs orders are discretionary in nature, Mr Bovaird must demonstrate that the exercise of discretion miscarried in one or more of the ways described in House v R (1936) 55 CLR 499, at 504-505. 26 Dr Harper submits that the Tribunal failed to take into account the following material considerations:

it was not satisfied that Mrs Fallon had a genuine concern for Mrs Bovaird's welfare as her primary motivation in making the application;

it ought therefore to have followed, and should have been found, that Mrs Fallon's primary motivation in bringing the application was to frustrate the Supreme Court proceedings;

the Tribunal ought not to have accepted that Mrs Fallon "may sincerely see [Mr Bovaird's use of his mother's money] as calling for intervention by the Tribunal" but ought to have found that Mrs Fallon had no such sincere belief;

the conclusion that Mrs Fallon's primary motivation was to stultify the Supreme Court proceedings and the finding which should have been made that she was insincere in her concerns about Mr Bovaird's financial management ought to have led to the Tribunal characterising her application as an abuse of process. 27 Dr Harper submits that these errors fatally undermine the Tribunal's exercise of its discretion on costs. 28 I am unable to accept these submissions for the following reasons, which are substantially those advanced by Mr Cotman SC. 29 As the Tribunal made expressly clear in its costs judgment of 6 February 2008, the Tribunal was very conscious that, although it was not satisfied of Mrs Fallon's genuine concern, it had deliberately (rather than inadvertently) refrained from making a positive finding that the application was frivolous or vexatious (Reasons p.3). This was because Mrs Fallon's application raised "major issues" in relation to whether a financial management order was in Mrs Bovaird's interests. The Tribunal said: "Whilst ultimately not making a financial management order, the Tribunal's decision was made on balance rather than on the decision being very clear-cut." (ibid)

Obviously, this is a reference to the extensive consideration in the Tribunal's reasons of the circumstances in which Mr Bovaird "has been deriving substantial on-going financial benefits from his mother's estate" : Reasons p 17. 30 The Tribunal's consideration of Mr Bovaird's financial management occupied some six pages of the Tribunal's Reasons. It concludes with the Tribunal noting that Mr Bovaird was prepared to give undertakings not to use his mother's assets and income for certain purposes. It is clear that the Tribunal saw some substance in Mrs Fallon's allegations concerning Mr Bovaird's use of his mother's assets, at least to the point where it was not prepared to disbelieve her when she said that her concerns about Mr Bovaird's financial management were a reason for making the application. 31 While I accept, as the Tribunal did, that there is strong ground for believing that Mrs Fallon's motivation in bringing the application was to frustrate the Supreme Court proceedings, it does not follow that the application was, by that fact alone, an abuse of process. The application was unquestionably made in respect of an incapacitated person and there was some substance in Mrs Fallon's complaints as to how Mr Bovaird, as his mother's attorney, was using her property. The Tribunal saw and heard Mrs Fallon give evidence. They were entitled to take into account the impression which she made upon them as a witness in accepting that she may have been sincere in her view that intervention by the Tribunal was necessary. The application which she brought was a perfectly appropriate proceeding to secure that intervention, if the Tribunal had found it necessary. 32 The Tribunal declined to make an express finding that Mrs Fallon's application was vexatious and an abuse of process. I am not persuaded that, in taking that view, the Tribunal fell into any error of law or failed to make findings of fact which the evidence made glaringly probable. I conclude that nothing has been shown to warrant the Court's interference with the Tribunal's exercise of discretion in refusing to award indemnity costs. 33 Similarly, I see no error warranting interference with the Tribunal's decision to award only half of the costs of the hearing from March 2007 onwards. As the Tribunal made clear, a great deal of evidence had to be considered, much of which had been adduced by Mr Bovaird, who failed in his own application for a financial management order. The Tribunal adopted a broad brush approach in apportioning costs in those circumstances and I cannot see that it was clearly wrong to do so. 34 Likewise, I cannot see how I can interfere with the Tribunal's conclusion that Senior Counsel's costs ought not to be awarded to Mr Bovaird. As a specialist Tribunal, it is far better equipped than this Court to determine whether the complexity of a particular case justifies Senior Counsel. 35 For these reasons, the Plaintiff's appeal from the Tribunal's costs order is dismissed. - oOo -

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.

Family Provision Act 1982(NSW)

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