GFN [2021] NSWCATGD 7

The hearings

1. MZN's application to review the enduring power of attorney was first listed before us on 28 January 2021.
2. While some evidence was taken on that day, the hearing was adjourned, part heard, to enable MZN to read and consider materials provided by OAG which - through no fault of OAG - only reached the Tribunal in the course of the hearing. During that hearing MZN made it clear that her desired outcome from the proceedings was for the Tribunal to treat the application as an application for financial management and appoint the TAG as GFN's financial manager.
3. The Tribunal explained to the parties that an option available to the Tribunal on reviewing an enduring power of attorney, was to not make any order under the Powers of Attorney Act but to instead treat the application as an application for financial management. The hearing proceeded on the basis that the Tribunal was being asked to do so with the TAG being proposed as financial manager.
4. The hearing was conducted using a Virtual Meeting Room in accordance with the Tribunal's COVID-19 procedures. Participating in the hearing on 28 January 2021 were:

• MZN, wife and applicant - by video.
• OAG, stepdaughter and enduring attorney - by phone.
• TYK, daughter of GFN - by phone.
• Ms Z, a Senior Social Worker with a mental health service provider, supporting and assisting MZN by video. .

1. Medical evidence before the Tribunal indicated that, because of his severe dementia, GFN was unable to participate in the hearing and would not understand what was occurring if he did. There was agreement about this amongst all participants. We were satisfied that GFN, as a result of his dementia, was unable to participate in the hearing, would be unable to express a view, and that in those circumstances we should proceed in his absence. We did not think it fair or in his best interest to require him to attend the hearing given his dementia and history.
2. The application was relisted for hearing before us on 5 February 2021. MZN did not attend. She applied in writing for an adjournment, relying on a medical certificate which said she was in hospital and too ill to attend. OAG opposed any adjournment stating that MZN was seeking sympathy and delaying the proceedings. We determined to adjourn the matter and made directions requiring MZN to put her response and submissions in writing. We made it clear that we did not wish to adjourn the matter again.
3. The matter was relisted before us on 19 March 2020. OAG, MZN and Ms Z participated as before. This time TYK was not present. At the conclusion of the hearing, we reserved our decision as we needed time to consider it.
4. These are our reasons for the decision we have reached.

Overview of Evidence

1. Outlined below is a synopsis of the evidence given to the Tribunal both orally and in document form. There was substantial agreement between OAG and MZN as to what had occurred. Where there were differences between them, we have noted them and have briefly explain why we have reached the conclusions we have.
2. GFN is an 81-year-old man with a history of dementia with behavioural disturbances. He also has insulin-dependent diabetes. He is currently a permanent resident of an aged care facility.
3. MZN, his wife, lives at a nearby suburb in regional NSW, in a movable dwelling at a residential park. That dwelling is owned by her daughter OAG, who is GFN's enduring attorney under the enduring power of attorney executed on 19 June 2012.
4. GFN has three daughters from a previous relationship: they are TYK, Ms Y and Ms X. He is also stepfather to MZN's two children from a previous relationship: Mr W and OAG.
5. There is a dearth of medical evidence relating to GFN's condition prior to and at the time of signing the enduring power of attorney.
6. The nearest report in time is dated 25 September 2012 and comes from Professor V, a consultant physician. The report is to Dr U, who was at the time GFN's GP. It reads: I saw [GFN] on the 25th of September 2012. He was accompanied by his daughter. He told me he had a very good stay at [a private hospital] when his blood pressure, blood sugars and behaviour were within normal limits. He went home and had tantrums, according to his daughter. He is still on the same treatment, however there is a lot of friction in the family about his business. He has cancelled the power of attorney and told his lawyer that he is in charge of his business and the family is very concerned about this. It would be good to get psychogeriatric input into his management and I will request [Mr Q] to do this….
7. There is no evidence before us that GFN did revoke his enduring power of attorney. Indeed, as will be seen below, he later affirmed OAG's appointment in evidence to the Tribunal and made no mention of a revocation. MZN does not allege the enduring power of attorney was revoked.
8. There are no other medical reports about GFN's medical and cognitive condition around the time he executed the power of attorney. There is a social work report from Ms T, dated 7 November 2012, which reports on GFN and MZN's poor living conditions and says that GFN is having outbursts, is sad and depressed, and is angry at OAG for interfering in his business.
9. In or around late 2012, through to 2014 and later, GFN and MZN's lives were in chaos. Their business, a bus company, was going broke and the financiers had stepped in and put it in the control of what MZN and OAG describe as "a liquidator".
10. The business was owned and operated by a company called Company XYZ which was trustee for the family trust of GFN and MZN. GFN and MZN were directors and shareholders of Company XYZ.
11. An examination of the company records shows that Company XYZ was deregistered in 2015. No annual returns or other company documents were filed for the company with the ACCC from 2008 onwards. A company search does not show the company entering any form of formal external administration.
12. The evidence from OAG and MZN, however, is clear: that the company's assets were sold by its financiers to satisfy debts, and that at that time GFN and MZN's creditors were "circling".
13. GFN and MZN's situation was made worse by MZN's opiate addiction. While MZN disputed that she is now addicted to any drugs, she did acknowledge that she had a problem in the past.
14. OAG and TYK were insistent that MZN is a long-term opiate addict, who was in the thralls of her addiction, and suffering ill health, in the period when the business was going broke and, in the years, following. They say MZN was and still is incapable of caring for GFN due to her addiction.
15. There are a number of social work and nursing reports among the material before the Tribunal which refer to MZN's active addiction. In a report dated 1 May 2013 Ms S from the Chronic Diseases Team reported on a visit to GFN and MZN who were then living in a van. She reported that GFN's hygiene was poor, there was spoiled food about, the place stunk of urine, GFN's was not eating a diabetic diet, and that MZN had an active opiate addiction. There are also letters from each of GFN and MZN's children which refer to her ongoing addiction being a constant problem. We are satisfied that the weight of evidence points to MZN having a long-standing opiate addiction.
16. MZN now has breast cancer, which she told us is terminal. She is prescribed opiates for pain but gave evidence that she is no longer addicted. Social work reports provided by Ms Z, a Senior Social Worker with the Older Person's Mental Health Service, did not address the issue of MZN's addiction. Ms Z supported MZN in making her application.
17. OAG bought the movable dwelling in which MZN now lives on 20 June 2014. MZN pays rent on the site at the residential park but uses the dwelling as her own. OAG's evidence is that the dwelling was bought as a home for MZN.
18. MZN said that the dwelling was purchased by OAG, in her own name, using GFN and MZN's money. OAG agrees that the money used to purchase the dwelling was intended for GFN and MZN's benefit and regarded as theirs. She says it was money that she was able to obtain from the liquidator of the company when it was being sold up. It formed part of the proceeds of sale of a property at Property ABC (at which GFN and MZN lived) which was owned by Company XYZ and sold on 23 September 2013.
19. OAG said that when the company's assets were being sold up, MZN suffered a heart attack. GFN was not able to deal with the issues at hand and that she stepped into the breach. She dealt with liquidators and lawyers, and personally attended to a number of outstanding issues relating to the company, including appearing for it in the CTTT. A letter from the solicitors engaged on the sale of Property ABC verifies this. It also states that the net proceeds of sale of Property ABC were held in trust and then paid to OAG, as company secretary, in accordance with an authority signed by MZN, a copy of which was provided to the Tribunal.
20. MZN and OAG do not agree about OAG being company secretary, with MZN saying she was always in that role. OAG says that she was appointed as secretary in order for the sale of Property ABC to proceed, that MZN knew of this, and signed the relevant documents which she believes were filed with the ACCC. As already noted, ACCC records show no documents filed for the company after 2008. We are unable to resolve this difference but do not think it crucial to the issues before us. It would make sense if both GFN and MZN were unable deal with company issues as a result of illness, for someone else to be appointed as a director or secretary of the company to affect the sale of company property.
21. The proceeds of sale of Property ABC were $144,701.93. This was first paid into a solicitor's trust account and was then paid to OAG. MZN authorised that payment by signing an authority to pay. OAG then paid the money into a bonus saver account in GFN and MZN's joint names that she was authorised to operate. OAG said that the advice she was receiving at the time was that she should get rid of the funds to protect the money from GFN and MZN's circling creditors.
22. OAG said that the money in the joint account was paid to GFN and MZN as follows: 1. $5000 was paid to GFN on 13 October 2013. 2. $10,000 was paid to MZN on 18 October 2013. 3. $6710 was used to purchase the coach in which GFN and MZN were then living. 4. $3000 was used to purchase a car for them. 5. $2000 was paid to GFN on 24 October 2013. 6. On 25 October 2013, $120,702.93 was paid to MZN by bank cheque on her insistence. MZN acknowledged this in writing.
23. While MZN had not outlined these transactions in her evidence to the Tribunal, instead going straight to the purchase of the dwelling, she did not take issue with this evidence. It was also verified by correspondence from the solicitors. We are satisfied that the funds were paid into the joint account and dispersed as outlined in the solicitor's letter and OAG's evidence.
24. OAG's understanding was that MZN then gave the majority of the funds to her son, Mr W. When we asked MZN why she had done this she said that the credit card companies were circling, and she wanted the funds protected. She wanted Mr W to mind the money for her.
25. OAG said that at about this time GFN was unwell. GFN and MZN were living in appalling conditions and MZN was unable to take care of both herself and her husband. She said that they had gone "off the rails". Various members of the family were trying to find alternate accommodation for them, including, at one time, a flat in regional NSW organised by TYK.
26. At some stage in early 2014, GFN and MZN were living in hotel accommodation at another suburb in regional NSW. They were involved in a car accident when GFN, who was unlicensed, was driving. OAG alleges that MZN fled the scene. MZN denies this saying she was taken to a local doctors. A consequence of the accident was that GFN was again placed in involuntary care. MZN continued living in hotel accommodation at that other suburb in regional NSW and was unwell. We think it unnecessary to determine whether MZN fled the scene of the accident.
27. OAG says that it was about then, in April 2014, that she discovered that MZN had given the money to Mr W for safekeeping.
28. There were then various family meetings and discussions held, involving the children of both GFN and MZN, following which it was decided that the monies Mr W held should be applied to purchasing a place where GFN and MZN could live. It was thought that, if MZN gained access to the funds, they would not last long.
29. On 2 May 2014, a guardianship application was made to the Tribunal with respect to GFN, together with an application for financial management. The applicant was Ms R, from the mental health unit at a public hospital, where GFN was living following the car accident. This was listed for hearing on 16 June 2014.
30. EFG submitted his resignation as one of GFN's attorneys on 24 May 2014. According to OAG he was uncomfortable with having to deal with MZN's continuing traumas.
31. OAG says that, on 4 June 2014, Mr W willingly gave her the balance of the money he held for MZN: $107,000. OAG says that it was agreed, between GFN and MZN's children, that this money was to be used to purchase a place for them to live.
32. On 16 June 2014, the Tribunal heard the applications for guardianship and financial management for GFN. The Tribunal found that GFN was a person with has a disability who was incapable of managing his person. The only person attending who considered GFN capable of making decisions was MZN. All the children participated in the hearing and supported the appointment of OAG as guardian. They believed that she would need coercive powers to be an effective guardian. The Tribunal appointed OAG as guardian with the function of accommodation including coercive powers.
33. The application for financial management was withdrawn and dismissed. The Tribunal explained: At the commencement of the hearing [Ms R] asked the Tribunal to consent to withdraw the application for the appointment of a financial manager for [GFN]. At the time the application was lodged the attorney [OAG], had been reluctant to act upon the power of attorney due to the fragile relationship with [GFN]. [GFN]'s mental capacity has settled and the relationship with [OAG] has improved again. [GFN] agrees that he appointed OAG as his attorney pursuant to the power of attorney of 19 June 2012. [MZN]'s family support [OAG] as attorney. As informal arrangements have been put in place to enable financial management to occur, and [OAG] is willing and able to act as attorney, there is no need for a financial management order to be made.
34. On 20 June 2014 OAG purchased a movable dwelling in the residential park. The purchase price was $105,000. The dwelling was purchased in OAG's name, not that of GFN and MZN.
35. MZN was aware of the purchase and of the source of the funds. She has lived in the dwelling ever since. OAG also says that she spent money furnishing the place, which MZN disputes. It is not necessary for us to resolve this conflict.
36. The relationship between OAG and MZN is not a good one. While they each have differing explanations as to why that is so, the two have been in conflict for many years. The heat with which that conflict burns varies with the circumstances. At the time of the hearings before us the conflict between them was heated. OAG however, told us that there was no conflict as she was no longer speaking with MZN. Therefore, there was no conflict between them. We thought this a fanciful and somewhat artificial construct on OAG's behalf. The conflict between them was patent.
37. The Tribunal record indicates that there has been considerable conflict within the family about care arrangements for GFN over the years. This led to the Tribunal hearing a requested review of the guardianship order appointing OAG, within four months of the original guardianship order being made. That review application was made by MZN. She alleged that OAG had been exceeding her powers by restricting GFN's access to the community and to her.
38. The Tribunal heard the review application on 2 October 2014.
39. At that hearing GFN told the Tribunal that he wanted to live with his wife and that OAG was abusing her position as guardian. There was general agreement among the children (including OAG) that the level of conflict had reached the point that an independent guardian was required. MZN said that GFN was sick of being locked up and could make decisions for himself. His brother, Mr MN argued that he should be appointed guardian in OAG's stead. A friend supported GFN's return home. The Tribunal appointed the Public Guardian as GFN's guardian for the balance of the term of the order, with the functions of access, accommodation including coercive powers, healthcare, medical and dental consent, and services.
40. In a letter written to the Tribunal for that guardianship review OAG's lawyers advised, among other things, that: Recently [OAG] negotiated and purchased a relocatable home for her mother from funds she was holding on their behalf and furnished it as [MZN] was homeless, living in a motel and [GFN] had been placed in a hospital under guardianship.
41. It is to be noted that this letter did not advise in whose name the dwelling was purchased.
42. After being appointed, the Public Guardian decided that GFN should return home to live with MZN in the movable dwelling. This occurred in January 2015 and is said to have gone well for some time.
43. The next review of the guardianship order occurred on 3 June 2015. Not all family members accepted that the move had been in GFN's best interest, and some were having difficulties having contact with him. OAG, Mr W and his wife did not participate in the hearing but supported the continued appointment of the Public Guardian. So too did TYK and Mr MN. The Tribunal reappointed the Public Guardian with the same functions for a further 12 months.
44. GFN's stay at home did not last beyond a year. He reached a point where he could no longer be cared for at home and again become a public patient on an involuntary basis.
45. There is a considerable history of GFN being admitted to a variety of institutions on an involuntary basis, with shorter periods spent in the care elsewhere or with his wife. His involuntary admissions were the result of his unrestrained, sometimes aggressive and irrational behaviour. Before his recent move last year to the aged care facility, he has spent the majority of his time as an involuntary patient. It is only in the past couple of years that his behaviours have settled and that he has been slowly able to be transitioned into normal aged care.
46. He is reported to have settled well at the aged care facility since he moved there in 2019.
47. In the meantime, the Public Guardian has continued as GFN's guardian, with the functions given to the guardian changing over time. Access and accommodation powers were no longer seen as necessary in 2017, when he was a long-term patient, and the Public Guardian was reappointed for three years. Accommodation was added as a function of the Public Guardian when the order was next reviewed in 2020, with his move to aged care in mind. This time the Public Guardian was appointed for two years with the functions of accommodation, health care, medical and dental consents and access to services. Conflict within the family and difficult communication persisted.
48. Throughout this time MZN remained living in the movable dwelling. There is no evidence of her complaining about the financial arrangements underlying the purchase of that dwelling until late 2020 when she made this application to the Tribunal.
49. When GFN was a patient in a public hospital, he sometimes did not have to pay fees. When he moved to the aged care facility, he was required to do so, as is any other resident of an aged care facility.
50. At that time GFN and MZN had both been in receipt of an aged pension for some years. Their pensions were paid into a joint account in GFN and MZN's name, which was in MZN's control. Until late 2020 OAG let this arrangement remain in place. She did not seek to control GFN's income from his pension. It was effectively left for MZN to use as she saw fit.
51. When GFN moved into aged care, MZN was required to apply his income towards the payment of his fees. This reduced the income to which she had ready access. In response to questions from the Tribunal she said that she had not saved money over the years.
52. MZN told us that when she was diagnosed with and began treatment for her breast cancer, she found surviving financially increasingly difficult. She explained that the extra costs occasioned by her treatment meant that she was often short, and she had trouble paying full fees for GFN at the facility. She approached the aged care service provider who runs the facility about her difficulty and was treated sympathetically. Nonetheless, throughout 2020, a debt to the aged care service provider slowly increased, with the aged care service provider saying she overdrew funds from GFN's account at times, resulting in the fees not being paid.
53. The February statement from the aged care service provider shows a balance outstanding of $652.81. By the end of April 2000 $2,154.59 was outstanding. The July statement shows $3,022.69 owing. The August closing balance is $3,837.39. MZN gave evidence that she was attempting to deal with these debts. The emails she provided to the Tribunal show that she was seeking to negotiate a reduction or postponement of fees with the aged care service provider.
54. On 16 October 2020 the aged care service provider alerted OAG to the problem with the payment of fees in an email which read: As you are aware, [GFN] is a resident of [an aged care facility] and as a result of funds being withdrawn from his bank account, he currently owes $3790.99 in nursing home fees. I would appreciate if you would arrange to have his pension paid directly into [the aged care service provider]'s bank account to ensure his fees are paid in the future. ,,, I have attached a fee statement from the date of entry for your perusal.
55. Unsurprisingly this moved OAG to action. Her actions did not include speaking with MZN. OAG attended Centrelink and arranged for GFN's aged pension to be paid directly to the aged care service provider's bank account as requested. She terminated MZN's status as GFN's Centrelink nominee.
56. MZN discovered this when she received a notice, dated 20 October 2020, from Centrelink advising her that her appointment as nominee had been terminated. MZN continues to be treated for her breast cancer and to experience financial difficulties. She can no longer access GFN's aged pension.
57. On 18 November 2020, MZN lodged an application with the Tribunal seeking to review both the making and the operation and effect of the enduring power of attorney appointing OAG. In that application, as noted above, she stated that OAG had terminated her joint bank account with GFN. During the hearing we clarified that this was not the case. The complaint was that OAG had stopped payments of GFN's pension into their joint account, by redirecting it to the aged care service provider.
58. During the hearing OAG was asked whether she is now prepared to transfer the movable dwelling out of her own name, and into the names of GFN and MZN. She said she would not do this because her mother would have nowhere to live if the asset were sold; that her mother would squander the funds if she had access to the proceeds of sale; that the family had agreed that funds should be kept for either GFN and MZN's future needs, and to pay for funerals, etc.

What did the Tribunal have to consider?

1. The Tribunal may, on the application of an interested person, decide to review the making or the operation and effect of a reviewable power of attorney, or not to carry out such a review: Powers of Attorney Act, s 36(1). As a consequence of reviewing the making or operation and effect of a reviewable power of attorney, the Tribunal may decide whether or not to make an order under s 36 of the Powers of Attorney Act (s 36(2)).
2. The Tribunal may make a number of orders relating to the making of a power of attorney including the following:

• An order declaring that GFN did or did not have mental capacity to make a valid power of attorney.
• An order declaring that the power of attorney is invalid (either in whole or in part) if the Tribunal is satisfied: 1. GFN did not have the capacity necessary to make a valid enduring power of attorney. 2. The enduring power of attorney did not comply with the requirements of the Powers of Attorney Act. 3. The enduring power of attorney is invalid for any other reason, for example, dishonesty or undue influence.

1. The Tribunal may make a number of orders relating to the operation and effect of a power of attorney if it is satisfied:

• that it would be in the best interests of GFN to make the order
• that it would better reflect the wishes of GFN to make the order

1. These orders include:

• An order varying a term of, or a power conferred by, the power of attorney.
• An order removing a person from office as attorney.
• An order appointing a substitute attorney to replace an attorney who has been removed from office or who otherwise vacates the office.
• An order reinstating a power of attorney that has lapsed by reason of any vacancy in the office of power of attorney and appointing a substitute attorney to replace the attorney who vacated office.
• An order directing the attorney to: 1. Furnish accounts to the Tribunal or someone nominated by the Tribunal. 2. Lodge a copy of all records and accounts of dealings and transactions made under the power. 3. Requiring that the records and accounts be audited and that a copy of the report of the auditor be furnished to the Tribunal. 4. Submit a plan of financial management for approval.
• An order revoking all or part of the power of attorney.
• Such other orders as the Tribunal thinks fit.

1. If on a review of the enduring power of attorney, the Tribunal decides not to make an order under s 36 of the Powers of Attorney Act, it may, if it considers it appropriate in all of the circumstances, decide to treat the application for review as an application for a financial management order under Pt 3A of the Guardianship Act 1987 (NSW).

Does MZN have standing to make the application?

1. A person may apply for an enduring power of attorney to be reviewed if he or she is: 1. an attorney (including an attorney whose appointment has been purportedly revoked), 2. the principal, 3. any person who is: 1. a guardian of the principal (whether under the Guardianship Act or any other Act or law), or 2. an enduring guardian of the principal under the Guardianship Act, 1. any other person who, in the opinion of the review tribunal, has a proper interest in the proceedings or a genuine concern for the welfare of the principal.
2. The Tribunal found that MZN has standing to bring the application because we were satisfied that, as the wife of GFN, she has both a proper interest in the proceedings and a genuine concern for his welfare.

Should the Tribunal conduct the review?

1. In Susan Elizabeth Parker v Margaret Catherine Higgins & Ors [2012] NSWSC 1516, Slattery J stated [at 80]: On an application for s 36 review such as this the Court must first exercise a discretion under Powers of Attorney Act, s 36(1) to decide whether or not to conduct a s 36 review. In my view the Court does not have to conduct a full review of all documents associated with the operation of the subject power of attorney to do this. Something short of a full review must be able to justify the exercise of the s 36(1) discretion as to whether or not the Court should conduct a full s 36 review. In the circumstances of this case the Court can glean sufficient information to exercise the s 36(1) discretion by undertaking a general survey of what... (a party )...has produced.

Should we review the making of the power of attorney?

1. We decided not to conduct a review of the making of the enduring power of attorney because there was insufficient evidence before us to reach a conclusion that GFN was unable to understand the nature and effect of the power of attorney when he made it. This was the basis of MZN's attack on the making of the enduring power of attorney.
2. There was no medical evidence concerning the development of his dementia prior to or at the time he executed the power of attorney. While there is a report from Professor V, some three months after the power of attorney was executed (quoted at [21] above,) that report reaches no conclusions about GFN's capacity at that time, or when he executed the power of attorney. Professor V did suggest that a psychogeriatric assessment might assist, but there is no such assessment. Nothing in the material before us points to GFN not having relevant capacity at the time, he executed the power of attorney. The solicitor witnessing the execution certified that he explained the instrument to GFN and that he appeared to understand it.
3. Therefore, we decided not to review the making of the power of attorney.

Should we review the operation and effect of the power of attorney?

1. We decided that the Tribunal should conduct a review of the operation and effect of the power of attorney. We did so for a number of reasons.
2. First, were satisfied on the evidence that: 1. That the enduring power of attorney commenced operation when it was executed by GFN on 19 June 2012. It appointed OAG and EFG jointly as enduring attorneys. 2. EFG resigned his appointment on 28 May 2014. Thereafter, OAG was the sole enduring attorney appointed under the instrument. 3. From at least early September 2013, when Property ABC was coming up for sale, OAG believed GFN was incapable of making personal and business decisions. Her evidence of her role in the company at that time, as verified by the solicitors' letter, shows that she was taking an active role in managing GFN's financial affairs and those of the company. 4. In October 2013, OAG had effective control of GFN and MZN's joint account into which she paid $144,701.93 being monies belonging to Company XYZ, which she held for GFN and MZN. The majority of these funds ($120,702.93) she paid to MZN, on behalf of both GFN and MZN. The balance was given to GFN and MZN in cash and also used to purchase a car and coach for them. 5. In making those payments OAG was seeking to hide that money from GFN and MZN's creditors. 6. MZN then paid the money she had received to Mr W in an effort to hide that money from her and her husband's creditors. 7. OAG, with the agreement of all GFN and MZN's children, then obtained the $107,000 then remaining and used it to purchase a movable dwelling in OAG's own name. This was intended to provide a home for GFN and MZN. 8. OAG has said that she will not transfer the movable dwelling into GFN and MZN's name. 9. Until GFN moved to the aged care facility, MZN had unrestricted access to his age pension which was paid into their joint account she was free to use it for her own purposes and at times did so. 10. After GFN moved into the aged care facility his pension was needed to pay for his accommodation fees. 11. MZN withdrew funds from their joint account intended to pay GFN's accommodation fees, resulting in a debt accruing to the aged care service provider for accommodation fees over 2020. 12. In October 2020, OAG became aware of this and intervened by redirecting GFN's pension to the aged care service provider and terminating MZN status as GFN's Centrelink nominee.
3. Based on those findings we were satisfied that when acting as GFN's enduring attorney OAG had: 1. exceeded her authority by actively seeking to hide GFN's assets from his creditors; 2. wrongly purchased the movable dwelling in her own name, thereby appropriating to herself an asset that was partly his and partly that of his wife; 3. created an apparent conflict of interest between her interests as sole owner of the movable dwelling and those of GFN whose funds were used to purchase it in part; and, 4. conferred benefits on MZN when she had no authority to do so.

Discussion

1. It is important to understand that s 9(1) of the Powers of Attorney Act provides that a power of attorney confers on the attorney, "the authority to do on behalf of the principal anything that the principal may lawfully authorise an attorney to do".
2. G E Dal Pont, Powers of Attorney (3rd ed 2020, LexisNexis Butterworths) relevantly says at [5.21]: A power of attorney cannot, however, confer upon an attorney authority exceeding what would have been exercisable by the principal personally. Nor can it confer authority to perform an act that the principal is not legally allowed to perform. .For instance, a principal cannot appoint an attorney with the object of the attorney performing a criminal act, or an otherwise illegal act, on the principal's behalf. So it has been said that the principal cannot instruct an attorney to deprive the principal's creditors of their respective entitlements. And it has been held that an authority to an attorney to terminate the principal's life, or to assist in that process, is ineffective, as it would require the attorney to act unlawfully.
3. In The Estate of Weiss (Dec'd) [1962] P 136, Scarman J (as he then was) said at [144] that an attorney/administrator who: … has any reason to believe that the effect of compliance with the instructions will be to deprive creditors or beneficiaries of the respective entitlements or otherwise cause loss to the estate, he may well be failing in his duty if he does not seek directions of the Court.
4. In the circumstances of the current case, we are of the view that by actively seeking to hide GFN's assets from his creditors, irrespective of the source of advice that she do so, OAG has acted in excess of the authority conferred on her in accordance with s 9(1) of the Powers of Attorney Act. In reaching that conclusion we understand that OAG's wish to protect GFN's estate, but to do so by seeking to hide GFN's assets from his creditors exceeded her authority.
5. If this had been our only concern, we might simply have identified it and decided, in the exercise of our discretion, not to review the operation and effect of the enduring power of attorney.
6. An attorney is in a fiduciary relationship with the person whose affairs they manage. An attorney must act in the best interests of the principal and must not obtain a personal benefit other than specifically provided for in the executed enduring power of attorney: Powers of Attorney Act, s 12(1).
7. The real problem arises from OAG's purchase of the movable dwelling in her own name using her stepfather's (and mother's) money. This was a deliberate decision made by OAG in consultation with other members of the family. Her explanation about securing a home for her parents for the future, which her mother could not sell, is understandable. We do not doubt that her intentions were honest, or that her evidence that she will apply the asset to meet the costs of supporting GFN and MZN in the future, reflects her intent. The fact remains that she has purchased the dwelling in her own name in breach of her fiduciary duty to GFN.
8. OAG has breached s 12 of the Powers of Attorney Act by conferring a benefit on herself. That benefit is the legal ownership of the dwelling. Section 9 provides: 12 Prescribed power of attorney does not generally confer authority to confer benefits on attorneys (1) A prescribed power of attorney does not authorise an attorney to execute an assurance or other document, or to do any other act, as a result of which a benefit would be conferred on the attorney unless the instrument creating the power expressly authorises the conferral of the benefit. Note - This subsection restates a rule of the general law. Accordingly, whether the conferral of a benefit on an attorney is expressly authorised by a prescribed power of attorney is to be determined by reference to the general principles and rules of the common law and equity concerning the interpretation of powers of attorney. (2) Without limiting subsection (1), a prescribed power of attorney that includes the prescribed expression for the purposes of this subsection set out in Schedule 3 authorises an attorney to confer on the attorney the kinds of benefits that are specified by that Schedule for that expression.
9. In ZHC v ZHO [2018] NSWCATAP 190 the Appeal Panel said at [46-47]: "46 Effective 1 May 2015, the appellant was subject to the fiduciary duties applicable to an attorney, one of which is a duty not to mix the property of the principal with the attorney's own property (See Lush J in Re Buckley [2013] WTLR 373 at [42]). 47 The appellant admitted to the Tribunal below that she continued to intermingle her own funds with those of ZHP until June 2017, when she learnt that to do so was impermissible given her role as attorney. Irrespective of whether the appellant's actions lacked the character of dishonesty, this was sufficient in itself for the Tribunal to make the finding that it did."
10. Further, by purchasing the dwelling in her own name OAG has created a conflict between her interests and those of GFN. Whilst she says that she will apply the asset for GFN and MZN's benefit, she has put herself in a position where she can apply it for her own benefit.
11. Finally, when GFN executed the power of attorney, the prescribed expression in that document which allows benefits to be conferred on third parties, was deleted. Section 13 of the Powers of Attorney Act provides: 13 Prescribed power of attorney does not generally confer authority to confer benefits on third parties (1) A prescribed power of attorney does not authorise an attorney to execute an assurance or other document, or to do any other act, as a result of which a benefit would be conferred on a third party unless the instrument creating the power expressly authorises the conferral of the benefit. Note - This subsection restates a rule of the general law. Accordingly, whether the conferral of a benefit on a third party is expressly authorised by a prescribed power of attorney is to be determined by reference to the general principles and rules of the common law and equity concerning the interpretation of powers of attorney. (2) Without limiting subsection (1), a prescribed power of attorney that includes the prescribed expression for the purposes of this subsection set out in Schedule 3 authorises an attorney to confer on a third party the kinds of benefits that are specified by that Schedule for that expression.
12. Schedule 3 to the Powers of Attorney Act prescribes expressions and authorisations for powers of attorney. With respect to benefits conferred on third parties it provides: 1 Authority to confer benefits on third parties. (1) The prescribed expression for the purposes of section 13 (2) is as follows: I authorise my attorney to confer benefits on [insert name(s) and address(es) of each third party] to meet their reasonable living and medical expenses as provided by section 13 (2) of the Powers of Attorney Act 2003. (2) The prescribed expression authorises an attorney to confer a benefit on a named third party only if: (a) the benefit meets (whether in whole or in part) any expenses incurred (or to be incurred) by the third party in respect of any of the following: (i) housing, (ii) food, (iii) education, (iv) transportation, (v) medical care and medication, and (b) the benefit is not more than what is reasonable having regard to all the circumstances and, in particular, the principal's financial circumstances and the size of the principal's estate. (3) In this clause: close friend of a principal means another individual who has a close personal relationship with the principal and a personal interest in the principal's welfare. relative of a principal means: (a) a mother, father, spouse (including wife or husband), daughter, son, step-daughter, step-son, sister, brother, half-sister, half-brother or grandchild of the principal, or (b) if the principal is a party to a registered relationship or interstate registered relationship, within the meaning of the Relationships Register Act 2010, or a domestic relationship within the meaning of the Property (Relationships) Act 1984, any person who is a relative, of the kind mentioned in paragraph (a), of either party to the relationship.
13. For an attorney to confer benefits (which includes the usual support one might expect for a spouse or child) on a principal's spouse and/or children, the prescribed expression in cl 3(1) of Sch 3 of the Power of Attorney Act must be used in the power of attorney. As already noted, the prescribed expression does not appear in GFN's enduring power of attorney.
14. It follows that OAG, as attorney, did not have authority to allow MZN to use GFN's pension as she saw fit and for her own maintenance and support. In making that finding we are noting a legal consequence which OAG should have been aware of.
15. The prescribed expressions in the Powers of Attorney Act for the conferring of benefits and the giving of gifts, are, in our experience, underused and do not appear in many powers of attorney where the principal has dependents who are reliant on her or his support. Those are the exact circumstances in which one would expect to see provision for conferring gifts and benefits made.

Should the Tribunal make any orders under section 36?

1. Having reached those conclusions we then proceeded, pursuant to s 36(2) of the Powers of Attorney Act, to consider whether or not to make an order under section 36.
2. We ultimately concluded that we would not make an order under that section, but instead we decided to treat the application as one for a financial management order with respect to GFN's estate as allowed by s 37 of the Powers of Attorney Act.
3. We reached that conclusion as a result of OAG's refusal to contemplate transferring the dwelling into the joint ownership of her parents. If she had done so, she would have removed the principal impediment we saw to her continued control of GFN's estate as his enduring attorney. If the situation is to remain as it is - which is what OAG proposed - then she will continue to hold an asset in her own name that is rightly part of GFN's estate. We do not know whether he has left a will, or who the beneficiaries of his estate are. If the dwelling remains in OAG's name, it will not form part of his estate when he dies and will not, necessarily, pass in accordance with his wishes.
4. If the dwelling is not transferred, OAG will also remain in a position of conflict vis-à-vis GFN's interests. In Re R [2000] NSWSC 886 at [43] Young J (as he was then) cautioned that: "… to allow a person with conflicts of interest to continue is something that still has to be watched carefully. If it has to be watched carefully then it seems to me that it is just a question of fact and degree as to whether in all the circumstances it is in the best interests of the incapable person that that situation continue."
5. Further, OAG's explanation of her refusal to transfer the dwelling into the joint names of GFN and MZN, did not address GFN's interests at all. Rather, her explanation addressed the need that she perceives to stop MZN from being able to sell the asset and put it at risk. We did not think this a probable scenario if the dwelling is owned by GFN and MZN jointly. Whoever is representing GFN's interest, such as his enduring attorney or financial manager, will have to agree to the sale.
6. We were not persuaded that restraining MZN's behaviour, in the manner OAG seeks to do, by refusing to contemplate a transfer of the dwelling is necessarily one that GFN would approve of or is in his best interest. OAG's refusal is equally explicable as a means of seeking to exercise continuing control of her mother, as suggested by MZN.
7. We concluded, as a result of weighing these matters, that OAG should not continue to control GFN's estate.
8. MZN was not seeking to be appointed.
9. If we were to proceed to remove OAG from her office as GFN's enduring attorney, there was no one we thought capable of taking on the role available. This would mean that there would be no one left to manage the estate. This would be an entirely unsatisfactory result.
10. Consequently, we decided to treat the review of the enduring power of attorney as an application for financial management under which we could appoint a manager of GFN's estate. We noted that the effect of such an order would be the suspension of OAG's appointment as enduring guardian: Powers of Attorney Act, s 50(3).

FINANCIAL MANAGEMENT

1. Before we can make a financial management order in relation to GFN the Tribunal has to be satisfied of the following matters:

• GFN is incapable of managing his affairs.
• There is a need for another person to manage GFN's affairs and
• It is in the best interests of GFN for a financial management order to be made.

Is GFN incapable of managing his financial affairs?

1. In the present case there was no doubt, and it was agreed, that GFN is incapable of managing his financial affairs. This has been the case since at least early 2014. Since then, GFN has been reliant on others, including OAG and MZN, to manage his income and see to his maintenance and needs.
2. A report dated 19 November 2020 from Dr P of the Older People's Mental Health Service, provided to the Tribunal for the purpose of this proceeding, says that GFN is suffering from severe dementia that prevents him from managing his financial affairs. Similarly, Ms Z's social work reports, while advocating for MZN's interests, accept as given that GFN is incapable of managing his financial affairs.
3. We find that to be the case.

Is there a need for another person to manage GFN's financial affairs?

1. GFN's estate is a relatively simple one. OAG argued that there was no need to appoint a financial manager for him because his pension is paid to the aged care service provider and is used by it to pay his bills, meet his occasional and pharmacy needs, and to pay his arrears.
2. While this is correct, there is also a need for GFN's interest in the movable dwelling to be recognised and for that asset to be protected. This is not something that OAG as his enduring attorney is prepared to do. There is, therefore, a need for another person to manage GFN's financial affairs.

Is it in GFN's best interest for a financial management order to be made?

1. We think that a financial management order, which would enable action to be taken towards recognizing GFN as a part owner of the moveable dwelling, is in his best interest. We also think that having a financial manager who is willing to talk with and discuss his needs with his wife, as opposed to being in constant conflict (albeit without contact at times) with her, as OAG is, would be in his best interest.

Who should be appointed as financial manager?

1. In appointing a financial manager, as in making all other orders under the Guardianship Act, the Tribunal must act with the interests of the person concerned as the paramount consideration and in accordance with the other principles set out in s 4 of the Guardianship Act.
2. Section 25M of the Guardianship Act provides that, if the Tribunal makes a financial management order, it may appoint a suitable person to manage the person's estate or may commit the management of the estate to the TAG.
3. In Holt & Anor v Protective Commissioner (1993) 31 NSWLR 227, the Court said that the dominant consideration in making orders about financial managers was the welfare of the person. The President of the Court of Appeal emphasised the Court's broad discretion in deciding who should be financial manager but also set out possible considerations as to the competing advantages of the then Protective Commissioner and a family member as the manager of an estate. The TAG now exercises the role of the Protective Commissioner.
4. In GFN's case we were not prepared to contemplate appointing OAG as his financial manager. It is her conduct in purchasing the movable dwelling in her own name rather than that of GFN and MZN, and then refusing to transfer it to them, that has led to the need to make a financial management order. Given those circumstances, and the long history of family conflict relating to GFN, we were of the view that we should appoint an independent financial manager: one who is apart from that conflict and able to make an independent of assessment of what is in GFN's financial best interest.
5. We therefore committed GFN's estate to the management of the TAG.

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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: 28 May 2021