IF v IG & Others

NCAT Guardianship|2014-08-13|Before: Simpson J, Hodgson J, Young J

WHAT THE TRIBUNAL DECIDED 1The Tribunal dismissed the application for a guardianship order. The Tribunal appointed Mr SXA as financial manager for Mr MCQ subject to the oversight and direction of the NSW Trustee and Guardian. The Tribunal decided to make no order following its review of the enduring power of attorney.

BACKGROUND 2Mr MCQ is an 80-year old man with cognitive and physical disabilities and a range of health conditions. He lives at an aged care facility on the North Shore of Sydney. Mr MCQ has three adult children from his first marriage, Mr PMN, Mr NUH and Ms DVB. For 34 years he has been married to his second wife Mrs MSQ. He has two stepchildren, Mr LKJ and Ms TWD. 3In 2002, Mr MCQ signed an enduring power of attorney appointing his wife Mrs MSQ. 4There is a family business, Pty Ltd A, which was founded by Mr MCQ's father and then managed successively by his brother Mr DCG, by Mr MCQ and now by Mr PMN. 5In 2012, Mr MCQ moved into the aged care facility. 6Conflict has developed between Mrs MSQ and Mr MCQ on the one side and Mr PMN on the other side in relation to financial issues. Related to this conflict, Mr MCQ said that he did not wish to see Mr PMN. 7In December 2013, Mr PMN made applications for guardianship and financial management orders and for review of the enduring power of attorney. 8In February 2014, Mr MCQ signed an appointment of enduring guardian appointing Mrs MSQ in relation to accommodation, health and services issues with her two children as alternative guardians. 9With leave from the Tribunal, Mr IUY, solicitor represented Mr MCQ in the proceedings. Mr PMN and Mrs MSQ were also assisted by solicitors but did not seek leave for legal representation.

MR PMN'S STANDING TO MAKE THE APPLICATIONS 10For Mr PMN to have standing to make his guardianship and financial management applications, he needed to be a person "who, in the opinion of the Tribunal, has a genuine concern for the welfare" of Mr MCQ (sections 9(1) and 25I(1), Guardianship Act 1987 (NSW)). He could make an application for review of the power of attorney on the same basis or on the basis that "in the opinion of the review Tribunal, [he] has a proper interest in the proceedings" (section 35(1), Powers of Attorney Act 2003 (NSW)). 11In two cases, the Tribunal carefully considered what the standing provisions in the Guardianship Act require (ACJ [2007] NSWGT 15; QAG [2007] NSWGT 12). The Tribunal decided that, in the context of the Act, a genuine concern for the welfare of the person requires:

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 interests of the person must be the primary motivation for the application. 12The word welfare is used broadly in the Guardianship Act including financial as well as personal welfare. 13In KTC [2011] NSWGT 21, the Tribunal decided that the genuine concern test has the same meaning in the Powers of Attorney Act and considered what was meant by "a proper interest in the proceedings." In the current case, the Tribunal ultimately did not need to address the "proper interest" test as it found that Mr PMN satisfied the "genuine concern" test. 14Mrs MSQ and Mr MCQ each questioned Mr PMN's standing, suggesting that he was motivated by his own interests in the context of the financial dispute between him and his father. This was arguable in view of the financial conflict which preceded Mr PMN's applications being made. 15Clearly, Mr PMN did have personal financial interests in the situation in that the financial disputes included issues around the adequacy of the rent being paid by the family business (in which Mr PMN has a controlling interest) to the owners of the business premises (Mr MCQ one third, Mr PMN one third and the family superannuation fund one third) and whether the business owes Mr MCQ a considerable amount in long service leave. 16However, Mr PMN's applications expressed concerns about a range of issues including:
Mr MCQ's deteriorating physical and cognitive state over the years;
whether Mr MCQ had capacity to participate in directors' meetings of the trustee of the family superannuation fund;
his capacity to manage his financial affairs;
whether his financial affairs have been conducted for his benefit;
whether Mr MCQ would receive the best medical treatment if his nursing home and all family members were not fully informed about his health and needs;
and about access to Mr MCQ by his children and grandchildren. 17As the proceedings unfolded, there was conflicting evidence in relation to a wide range of issues. This is spelt out later in these reasons. 18In submissions, Mr PMN's solicitors maintained he had a genuine concern that dealings with Mr MCQ's assets and affairs were not for Mr MCQ's benefit and that these matters warranted investigation. 19The Tribunal took into account that Mr PMN is Mr MCQ's son, lived with him well into adulthood and worked with him in the family business for many years. In more recent times, there has been conflict around financial issues. 20In the hearing, when questioned by the Tribunal about what should happen if money needed to be extracted from the family business to meet Mr MCQ's needs, Mr PMN was clear and very emotional in stressing that his father's interests would have to come first. The Tribunal accepted the genuineness of this response. 21In view of Mr MCQ's cognitive impairment, conflict about his financial interests and family access to him, the Tribunal accepted that Mr PMN was bringing fact situations in which Mr MCQ's interests may call for the Tribunal's intervention. The Tribunal accepted Mr PMN's sincerity in seeing the situation this way and that his primary motivation was to advance Mr MCQ's welfare; the Tribunal was particularly influenced by the overall history of Mr PMN's relationship with his father and his emphasis that his father's financial interests must come first, 22The Tribunal accepted Mr PMN's genuine concern and standing in relation to each of his applications.

Issues for the Tribunal 23The questions which had to be decided by the Tribunal in relation to guardianship were:

Is Mr MCQ someone for whom the Tribunal could make an order because he has a disability which prevents him from being able to make important life decisions?
Should the Tribunal make a guardianship order and if so, what order should be made?
Who should be the guardian?
How long should the order last?
Does Mr MCQ have a disability which prevents him from being able to make important life decisions? 24To put this issue more precisely using the words in the Guardianship Act, the Tribunal had to be satisfied that:
Mr MCQ has a disability which restricts him in one or more major life activities to the extent that he requires supervision or social habilitation, and that, as a result,
he is at least partially incapable of managing his person. 25The Tribunal had a range of health professional evidence, in particular reports from geriatrician Dr Y who had seen Mr MCQ twice in April 2013. Mr MCQ was in a wheelchair related to a stroke in 2012. He had an extensive vascular history, including TIAs, strokes and stenting to the basilar artery. He had a history of some cognitive impairment since at least 2010. On cognitive testing, he showed some deficits. He had moderately severe dementia, physical disability and tired easily. Mr MCQ's cognitive function would almost certainly have deteriorated further since April 2013. 26In the hearing, Mr MCQ showed difficulty with recalling various aspects of his history and health situation and did not recall signing an appointment of enduring guardian. 27In a conciliation hearing, the parties had agreed that Mr MCQ was no longer able to make his own important lifestyle decisions and that there was a need for guardianship order. However, by the time of the hearing, Mr MCQ and Mrs MSQ's admissions appeared to step back from this concession. 28Particularly in view of the reports from Dr Y, the Tribunal was clear that Mr MCQ does have a significant cognitive impairment and physical disabilities that lead to considerable support needs. Dr Y's assessment of Mr MCQ's capacity to make decisions was mainly focused on financial issues. The Tribunal did not form a clear view about whether Mr MCQ lacks capacity to make important life decisions and is partially incapable of managing his person since, in any event, it would not have been satisfied that it should make a guardianship order - see below.

Should the Tribunal make a guardianship order? 29In deciding whether to make a guardianship order, the Tribunal needed to take account of all relevant factors, including those listed in Section 14(2) of the Act. These relate to the views of Mr MCQ and his spouse, preserving family relationships, preserving cultural and linguistic environments and the practicability of services being provided without a guardianship order. The Tribunal could be guided by the principles in Section 4 of the Act, in particular regarding Mr MCQ's interests as its paramount consideration. The Tribunal ultimately has a broad discretion whether to make a guardianship order (IF v IG & Others [2004] NSWADTAP 3). 30In his lawyer's submissions, Mr MCQ expressed contentment with his appointment of Mrs MSQ as enduring guardian and strongly opposed the appointment of any other guardian. In the hearing, Mr MCQ spoke very positively about Mrs MSQ and his trust in her as a decision maker if he needed one. 31Mrs MSQ wanted to continue as enduring guardian or person responsible. If family members did not accept Mr MCQ's wish not to see them, she requested that the Public Guardian be appointed in relation to this issue. 32There is no dispute about Mr MCQ continuing to live at the aged care facility which is an extra care facility with high fees. 33Mr PMN was keen to have a high level of access to information in relation to his father's health and care. However, while this may be Mr PMN's wish as a son who cares about his father, there was no significant evidence to suggest that this was needed in Mr MCQ's interests. 34If there is medical treatment that Mr MCQ does not understand, then the law says that his wife Mrs MSQ is the person to decide about this as "person responsible" under the Guardianship Act. Mrs MSQ would be person responsible as enduring guardian. There is some uncertainty about the validity of the appointment of enduring guardian in view of Mr MCQ's cognitive impairment. However, even if it is not valid, Mrs MSQ would be person responsible as the closely involved spouse. 35Mr MCQ has a long-standing general practitioner Dr X who visits the aged care facility very regularly and sees Mr MCQ as needed. In his report of January 2014, Dr X said that, at the aged care facility, Mr MCQ is receiving the highest quality care available. Mrs MSQ spends many hours each day with him ensuring that his occupational care is maintained. Dr X has witnessed Mrs MSQ's total dedication to Mr MCQ's well-being. She has always been his advocate to ensure that he has the best care and attention. Mr MCQ wanted Mrs MSQ as his guardian and carer. He could not have anyone better than Mrs MSQ to look after his welfare. 36In the hearing, Ms WFD, care manager at the aged care facility, said that Mr MCQ has been generally well over the last year. He receives physiotherapy, attends exercise classes and does exercises with Mrs MSQ. Mrs MSQ raises issues with Ms WFD directly and there are case conferences. Mrs MSQ raises sensible issues. The facility's relationship with Mrs MSQ works well. Mr MCQ did have an aged care assessment. The facility does not have him diagnosed with a cognitive impairment. 37Mrs MSQ spoke positively about the facility and said that she spends a lot of time with Mr MCQ. She speaks up about Mr MCQ's needs to staff. Dr X is a caring doctor. 38Mrs MSQ had written to the Tribunal that she was willing to notify Mr PMN of any major changes in Mr MCQ's care and treatment. 39Whilst the Tribunal was surprised that Ms WFD was not aware that Mr MCQ has a cognitive impairment, overall, it was clear that Mr MCQ's health and care needs are being met very conscientiously by the combination of the facility, Mrs MSQ and Dr X. 40The other issue that might have called for a guardianship order was the issue of access to Mr MCQ by Mr PMN and other family members. Related to the financial conflict, there have been issues about Mr PMN having access to his father. In June 2013, Mr MCQ signed a letter to Mr PMN asking him not to make further contact while financial issues were outstanding and threatening legal action if Mr PMN telephoned or visited. Mr PMN questioned that this letter could have been written by Mr MCQ. In the hearing, he said that there had been visits where Mr MCQ welcomed him after he had been told he was not welcome. 41In the hearing, Mrs MSQ said that she had not stopped Mr PMN's contact with Mr MCQ. She had written the June 2013 letter for Mr MCQ on the basis of Mr MCQ's thoughts and wishes, following an unpleasant visit by Mr PMN where Mr MCQ's will had been discussed. There had been some nice visits by Mr PMN to Mr MCQ at the facility but then some stressful visits. 42Mr MCQ said that Mr PMN very seldom visits him and he would not like Mr PMN to come more because Mr PMN aggravates him. He did not want to see him. Mr MCQ also spoke negatively about contact with his other children Mr NUH and Ms DVB. 43Ms WFD said that, from the facility's perspective, there was no impediment to Mr PMN visiting his father other than whether Mr MCQ wished to see Mr PMN. 44Mr PMN expressed concern about influence on Mr MCQ by others and suggested visits would be workable if there was a concerted effort by others. He also acknowledged that time is a healer and that the core issue was whether his father welcomed him when he walked in the door. 45As discussed in the hearing, the Tribunal did not see how a guardianship order in relation to access would be workable. It would be unrealistic to impose access on Mr MCQ. Whatever the impact of Mr MCQ's cognitive impairment and whether or not he is influenced by others, the core issue is whether Mr MCQ is willing to have contact with Mr PMN. 46Likewise with other family members, the core issue is whether Mr MCQ is willing to see them. 47Clearly, the current financial conflict is central to the access issues with Mr PMN. The Tribunal's hope is that the financial management order will allow these conflicts to be resolved. This is the most likely way to remove impediments to access by Mr PMN. Historically, Mr PMN and Mr MCQ clearly had a very close relationship living and working together and so it would be in Mr MCQ's interests if a positive relationship can resume in the future. However, the Tribunal could not see how appointing a guardian with an access function would facilitate this purpose. 48Overall then, while Mrs MSQ was open to the idea of the Public Guardian addressing access issues, the Tribunal would have seen this as an intrusion that Mr MCQ did not want and which would not have achieved any useful purpose. Mr MCQ's health and care needs are being well met and Mrs MSQ was willing to inform Mr PMN of any major changes in Mr MCQ's care and treatment. Even if the Tribunal could make a guardianship order, it was not satisfied that it should.

Issues for the Tribunal 49The questions which had to be decided by the Tribunal in relation to financial management were:

Is Mr MCQ incapable of managing his affairs?
Is there a need for another person to manage Mr MCQ's affairs and is it in his best interests for a financial management order to be made?
If so, who should be appointed financial manager?

Outline of Mr MCQ's financial affairs 50The family business, Pty Ltd A, is controlled by Mr PMN who is sole governing director and majority shareholder. Mr MCQ also has substantial shares in the company. 51The business premises in Sydney are owned one third by Mr MCQ, one third by Mr PMN and one third by the family self-managed superannuation fund whose trustee is Pty Ltd B. The premises were valued at $1 million in 2012. 52Pty Ltd B has two shareholders, Mr MCQ and Mr PMN each having one share. There are three directors, Mr MCQ, Mr PMN and Mrs MSQ. Mrs MSQ's uncontradicted evidence was that Mr MCQ is the predominant beneficiary of the superannuation fund with an entitlement in the order of $1 million plus 75% of the superannuation fund's interest in the business premises. 53Mr MCQ also has about $14,000 in the bank and $49,000 in listed shares. 54Mr MCQ paid a bond of $200,000 at the aged care facility. From the evidence in the hearing of Ms W, general manager of the facility, Mr MCQ now has a balance of $138,000 of this bond. From the bond, an extra services fee of $2400 a month is deducted plus, for five years, a retention fee of $323 a month. 55Mrs MSQ's understanding is that, when the $200,000 is fully used up, Mr MCQ will need to provide further capital for a bond or pay an extra amount each month. 56Ms W said that Mr MCQ also has to pay general fees of approximately $3700 a month. 57Over time, Mr MCQ has made considerable financial provision for each of Mrs MSQ and Mr PMN. This includes:

Transferring to Mrs MSQ his half share in their matrimonial home in Mosman.
In 2010, gifting to Mrs MSQ the $410,000 sale price of a property that he owned in Regional NSW.
Gifting to Mr PMN a one third interest in the business premises, plus over 15,000 shares in the family company on the basis of the shares being worth $311,350.

Is Mr MCQ incapable of managing his financial affairs? 58In PY v RJS [1992] 2 NSWLR 700, Justice Powell said that a person is not shown to be incapable of managing his or her affairs unless at least it appears: (a) that he or she appears incapable of dealing in a reasonably competent fashion with the ordinary routine affairs of man; and (b) that by reason of that lack of competence there is shown to be a real risk that either: (i) he or she may be disadvantaged in the conduct of such affairs; or (ii) that such monies or property which he or she shall possess may be dissipated or lost. It is not sufficient merely to demonstrate that the person lacks the high level of ability needed to deal with complicated transactions or that he or she does not deal with even simple or routine transactions in the most efficient manner. 59(a) above includes issues about being able to plan for the future, and working out how to feed one's family, generate income and look after capital (H v H, Supreme Court of NSW, Justice Young, 20 March 2000). It also includes being able to carry on a business. The likelihood that the person would seek and follow appropriate advice is important (Re GHI [2005] NSWSC 581). 60In P v R [2003] NSWSC 819, Justice Barrett restated the test for incapability as follows: The task of the court[...] is to make a judgment as to the capacity and ability of the person concerned to cope with the ordinary routine affairs of living, particularly so far as they concern the person's property. This is a somewhat shorthand version of the tests laid down by the authorities[...]The point to be emphasised is that the requisite judgment is to be made in the light of objective physical facts concerning the relevant person's property, money and other assets and the way the person is able to look after them. If there is a lack of capacity, the reason for it does not matter. 61Justice White followed this formulation in Re D [2012] NSWSC 1006 and the Tribunal also accepts it. 62As already referred to, the Tribunal had a range of health professional evidence, in particular reports from Dr Y who had seen Mr MCQ twice in April 2013. Mr MCQ was in a wheelchair related to a stroke in 2012. He had an extensive vascular history, including TIAs, strokes and stenting to the basilar artery. He had a history of some cognitive impairment since at least 2010. On cognitive testing, he showed some deficits. He had moderately severe dementia, physical disability and tired easily. Dr Y discussed with him his wish to transfer to his wife his one third interest in the business premises and thought he had sufficient understanding to make this decision. 63In January 2014, Dr Y reflected on her views and expressed some concern about the independence of Mr MCQ's wishes in relation to the business premises and his understanding of the ramifications for the family business of transferring assets to his wife. He would not have been capable of understanding complex legal or financial documents or attending company meetings and participating in discussions. Mr MCQ's cognitive function would almost certainly have deteriorated further since April 2013. 64Dr X has been Mr MCQ's general practitioner for 17 years. In a report dated 28 January 2014, he said that Mr MCQ was able to make his own personal and financial decisions. 65Dr V is a neurosurgeon who treated Mr MCQ in 2011. In July 2011, he showed significant changes with his thought processes. Dr V's view was that Mr MCQ lacked capacity to comprehend reasonably complex financial matters, to attend company meetings or to make an informed decision. 66Dr Y was the best qualified of the doctors to assess Mr MCQ's capacity. In view of her evidence, there was a strong argument to say that Mr MCQ is incapable of managing his affairs. This could be so even if he did have capacity for the specific financial issue on which Dr Y was focused in relation to a possible transfer of Mr MCQ's interest in the business premises to Mrs MSQ. 67From the conciliation hearing, there was common ground between the parties that Mr MCQ was incapable of managing his financial affairs. 68In the hearing, Mr MCQ showed limited awareness of his affairs. For example, he thought that he owned the business premises. He said that he was not sure whether Mr PMN had any ownership of the business. He thought that he had distributed the proceeds of the Regional NSW property to family members rather than just Mrs MSQ. 69Particularly in view of Dr Y's evidence and that of Mr MCQ in the hearing, the Tribunal was clear that Mr MCQ is incapable of managing his financial affairs.

Should the Tribunal make a financial management order? 70Mrs MSQ has been managing Mr MCQ's finances as his attorney. She told the Tribunal she uses the power of attorney to operate on Mr MCQ's bank account that his income goes into. She has a separate account and small income. They use their combined money to meet their needs. 71Mr MCQ was content for Mrs MSQ to continue as attorney. In the hearing, Mr MCQ's trust in Mrs MSQ was clear. 72The power of attorney is in the old form which includes a provision allowing the attorney to act in ways "whereby a benefit is conferred on her." The legal effect of this wording was never clear and under the Powers of Attorney Act 2003, much clearer and more limited standard powers are spelt out in relation to the extent to which attorneys may benefit themselves. 73There is a range of financial issues facing Mr MCQ, including:

How to arrange his affairs so as to meet his needs and comfort for the remainder of his lifetime.
What provision to make for Mrs MSQ's month to month needs.
How to deal with strong and consistent wishes that Mr PMN and Mr NUH attributed to Mr MCQ over time that the business and business premises should pass into Mr PMN's ownership. See Mr PMN's statement of 23 July 2014 and Mr NUH's letter to the Tribunal. 74More specific issues include:
Mr PMN's concern that there may have been considerable unexplained spending of Mr MCQ's money. On the basis of figures from Mrs MSQ, the Tribunal saw this as approximately $125,000 over 40 months to early 2014. Mr PMN claimed it was $197,000. Mrs MSQ said that unaccounted money had gone towards general living expenses.
The below-market rent being paid by the family business to the owners of the business premises. Mr PMN acknowledged that the rent has been below market but said that the rent was previously above market when a mortgage was being paid off. He said that the lower rent in recent years had been with Mr MCQ's agreement.
Whether Mr MCQ is owed approximately $50,000 in long service leave as alleged by Mrs MSQ but denied by Mr PMN.
The governance of the superannuation fund in view of Mr MCQ's declining cognitive capacity to act as a director and the negative relationship between the three directors. In 2013, there was major contention in relation to the wish of Mr MCQ and Mrs MSQ to issue to Mrs MSQ a share in the trustee of the superannuation fund.
Whether there should be some or total extraction of Mr MCQ's finances from the business and the current superannuation fund.
In early 2013, Mr MCQ was seeking to transfer to Mrs MSQ his interest in the business premises. 75All of these issues arise within a context of a very high level of mutual distrust between Mrs MSQ and Mr PMN. 76In the hearing, Mrs MSQ said she was happy to continue acting as attorney but, if it would help with the family conflict, she was open to having an independent financial manager. 77Mrs MSQ does have a conflict of interest in her role as attorney in that her own understandable interests in her ongoing maintenance and financial future do not necessarily coincide with Mr MCQ's interests. 78In Re R [2001] NSWSC 886, Justice Young carefully considered the issue of when a financial manager should be appointed in a situation where there is a power of attorney but the attorney has a conflict of interest. Justice Young said that, to allow a person with conflicts of interest to continue using a power of attorney is something that has to be watched carefully. It was "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." 79Another factor that favoured making a financial management order was that the resolution of the current financial issues will require resolution of a suitable outcome with Mr PMN. In view of the flagrantly poor relationship between Mrs MSQ and Mr PMN, the Tribunal was sceptical about the prospects off a sensible resolution of the current issues being achieved if she is the one negotiating with Mr PMN. 80A further argument for a financial management order is that it will bring the management of Mr MCQ's finances at least under the independent monitoring of the NSW Trustee and Guardian. 81Clearly there is a need for someone to manage Mr MCQ's affairs on his behalf. In view of Mrs MSQ's conflict of interest and the need to resolve issues with Mr PMN, the Tribunal was satisfied that Mr MCQ's interests required a financial management order so that a financial manager can resolve the issues rather than via the power of attorney.

Who should be the financial manager? 82The Tribunal needed to consider whether it could appoint a suitable person to the role of financial manager and otherwise needed to appoint the NSW Trustee and Guardian. This issue needed to be determined in accordance with Mr MCQ's best interests. The Tribunal has a broad discretion here. It needed to take into account all relevant circumstances and could be guided by the principles in section 4 of the Guardianship Act (Guardianship Act section 25M; Holt v Protective Commissioner [1993] 31 NSWLR 227; SH v Protective Commissioner [2006] ADTAP 22; LA v Protective Commissioner [2004] NSWADTAP 39; M v M [2013] NSWSC 1495). 83In Holt v Protective Commissioner, President Kirby of the Court of Appeal set out a checklist of considerations that "might be kept in mind" in deciding who should be financial manager. See also M v M [2013] NSWSC 1495 where the Justice Lindsay set out a checklist of factors that the Court might bear in mind. These factors included:

Prudent management administered without strife in the most simple and inexpensive way.
Whether the manager has given thoughtful attention towards a financial management plan. 84While there is no absolute bar on appointing a financial manager who has a conflict of interest, it is an issue that the Court of Appeal has said should be approached carefully and that ordinarily a person with a conflict of interest would not be appointed. In some family situations, the conflict of interests flowing from inter-related property interests will be more apparent than real. (Holt v Protective Commissioner [1993] 31 NSWLR 227 at 242. See also H v H, Supreme Court Protective Division, unreported, Hodgson J, 31 March 1994; Re R [2000] NSWSC 886; Re L [2000] NSWSC 721 and; M v M [2013] NSWSC 1495). 85Mr PMN proposed that Mr HMT or the NSW Trustee and Guardian be appointed as financial manager. Mr HMT is a chartered accountant who had been Mr MCQ's accountant for over 10 years for both personal and business matters. He has been the accountant for the family business and superannuation fund. He would not charge any fee. 86Mr MCQ was content for Mrs MSQ to continue as attorney. In the hearing, he also expressed clear trust for financial issues in his old friend Mr SXA who is an accountant. He was clear that he did not want Mr HMT involved with his finances. In "Background notes" of 5 August 2014, Mrs MSQ expressed various concerns about actions by Mr HMT and his firm. 87If an order was to be made, Mrs MSQ favoured herself being appointed as manager either alone or jointly with Mr SXA. In the hearing, she was open to Mr SXA being the manager. 88In view of Mr MCQ's capacity to at least participate in financial decision-making, the Tribunal was very sceptical about appointing a financial manager to whom he was opposed. This was the case with Mr HMT. 89In view of Mrs MSQ's conflict of interest and very poor relationship with Mr PMN, with whom a manager will need to seek to negotiate financial issues, the Tribunal did not see her as an appropriate financial manager. 90Mr SXA is a chartered accountant and long-standing good friend of Mr MCQ. He has had wide ranging experience in the commercial world. He is currently the principal and owner of a factoring and investment company. He was willing to act as financial manager without charge. 91In the hearing, Mr SXA said that he is a very good friend of Mrs MSQ and Mr MCQ and saw their family grow up. Mr MCQ has always kept him informed about things. He was willing to be financial manager. He felt it was best to separate Mr MCQ's interests from Mr PMN's as soon as possible. Mr MCQ will need the funds anyway. The current situation is just creating more problems for Mr MCQ mentally and physically. There is a need to move on from past promises. Mr SXA would seek an outcome that was beneficial to all parties. He emphasised his integrity and impartiality. 92Mr PMN could buy the business premises or they could be sold. The current rent did not seem to be a market rent. However, Mrs MSQ and Mr MCQ would probably not want to pursue past rent. The issue about the long service leave has gone on too long. However, if there is proof that it was paid, then that would be okay. 93Mr SXA was accepting of his obligation to act in Mr MCQ's best interests. This included checking that spending of Mr MCQ's money was in accordance with his best interests. He appreciated that he needed to act within the authority and directions of the NSW Trustee and Guardian. 94Mr PMN expressed concern that Mr SXA had formed a position without full information and about his independence. Mr SXA responded that Mr PMN would need to rely on his integrity. He is a chartered accountant. He is looking at the situation as he sees it unless he gets other information. He felt that Mr PMN had rejected reasonable offers that have been made. 95Mr PMN said that he favoured the NSW Trustee and Guardian being appointed because of its independence. 96The Tribunal saw arguments for and against appointing Mr SXA and for and against appointing the NSW Trustee and Guardian. 97In the case of Mr SXA, he had a major advantage of being able to provide a very personal approach to management in consultation with Mr MCQ who trusts him and is an old friend. The Tribunal saw this factor as very important in view of Mr MCQ's continued ability to input to decisions and the high level of conflict in relation to financial issues. Having a financial manager that he trusted and could readily communicate with would be very valuable to Mr MCQ's peace of mind. 98Mr SXA has financial expertise and already has substantial familiarity with the situation and Mr MCQ's attitudes. He would charge no fees. 99The disadvantage the Tribunal saw in Mr SXA was that he is a good friend of Mrs MSQ as well as Mr MCQ. This did create an issue of conflict of interest. Mrs MSQ's interests include being partially financially dependent on Mr MCQ and in addressing Mr PMN's concerns about management of Mr MCQ's affairs in recent years when Mr MCQ has had disabilities and Mrs MSQ has been attorney. Mr SXA's friendship with Mrs MSQ could also to some degree impede negotiations that he may need to have with Mr PMN in relation to the current financial issues due to Mr PMN's concern about Mr SXA's independence. Mr SXA did express some quite firm views about what actions he should take as financial manager. 100However, the Tribunal did accept Mr SXA's assurance that he would approach his position with impartiality and that he was open to new information. He also showed keenness to find a resolution to the conflict. Mr SXA's professional training would assist him with all this. The Tribunal also noted that Mr SXA would be under the usual oversight and direction of the NSW Trustee and Guardian which includes the Trustee's approval being required for actions. 101The advantage of the NSW Trustee and Guardian was its flagrant independence. On the other hand, it would not be able to provide the personal service that Mr SXA could provide. It would face a bigger challenge in coming to grips with the quite complex financial situation. It would charge fees. 102On balance, the Tribunal attached particular significance to Mr SXA's professionalism and close positive relationship with Mr MCQ. Mr SXA does face a conflict of interest but this is mitigated by his professional training, determination to be impartial and the usual oversight and direction of the NSW Trustee and Guardian. 103The Tribunal accepted that Mr SXA is a suitable person to act as Mr MCQ's financial manager and that it was in Mr MCQ's interests that he be appointed. 104Mr SXA's appointment will continue indefinitely unless the Tribunal, on application, decides it is in Mr MCQ's interests to replace Mr SXA as financial manager.

Recommendations 105The Tribunal recommends to Mr SXA that he first ensure that he has full and balanced information in relation to the issues facing him as manager. The Tribunal will provide him with all of the papers before it and it will be important for the parties to provide him with any other important information. 106Some of the information Mr SXA needs may include the following:

Mrs MSQ's financial situation and the extent of assets that Mr MCQ has given her over time. (This might include part of Mr MCQ's considerable inheritance from his brother Mr DCG in 2002 from which Mrs MSQ said he made gifts to a number of family members and friends.)
Evidence confirming that the $920,000 paid into Mrs MSQ's bank account on 18 June 2014 (which was used towards Mrs MSQ's current purchase of a new home) came from an account of her daughter Ms TWD as stated by Mrs MSQ. It was odd that the transfer of Mrs MSQ's previous home to Ms TWD was shown to be for no consideration when Mrs MSQ and Ms TWD assured the Tribunal that it was in fact for $650,000.
A copy of Mr MCQ's current will and, if a new will has been made in recent times, a copy of the previous will. In light of the recent report of Dr Y, there would have to be some concern about Mr MCQ's capacity to have signed a will in recent times. 107In light of all information, Mr SXA can further consider his views in relation to an appropriate financial management plan. 108Mr SXA will need to formulate an initial management plan for the approval of the NSW Trustee and Guardian. 109The Tribunal recommends that, within whatever parameters the NSW Trustee and Guardian may set, Mr SXA then seek to negotiate with Mr PMN an appropriate resolution of current issues of conflict. 110It is in Mr MCQ's interests to seek to resolve the current financial conflict fairly and as expeditiously as possible. This is important for Mr MCQ's financial security and peace of mind and, hopefully, to allow re-establishment of a positive relationship between Mr MCQ and Mr PMN. 111It would be preferable if the financial conflict can be resolved through negotiation if this is possible. Litigation would likely be protracted, expensive and traumatic for Mr MCQ.

REVIEW OF POWER OF ATTORNEY 112Having decided to make a financial management order, the Tribunal decided to make no order on the review of power of attorney. The power of attorney is suspended by the financial management order. Mr PMN had wanted orders for Mrs MSQ to account for her actions as attorney. She had done so to some degree in response to the Tribunal's directions in preparing the matter for hearing. The financial manager can consider whether to look into past financial issues further.

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: 22 October 2014

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