JPT v DST [2014] NSWSC 1735 | Case summary

Judgment 1This judgment deals with an application, by the mother of a young man whose estate was formerly under protected estate management, for an order that she be granted a capital sum by way of an allowance out of his estate for her past, gratuitous provision of care for him. 2The young man (the plaintiff in the current proceedings) was born in 1987 and is presently aged 27 years. He married in March 2013. He and his wife live in a residence owned by him, together with his wife's two young children by an earlier relationship. 3The first defendant in the current proceedings is the mother of the plaintiff. The second defendant is his maternal grandmother. His father died in 1988. 4For convenience, I refer to the principal parties (the plaintiff, the first defendant and the second defendant) by their designations in the current proceedings, notwithstanding that they had other designations in the proceedings (numbered 25 of 2006 in the Protective List of the Equity Division of the Court) in which protected estate management orders affecting the plaintiff were made (under the Protected Estates Act 1983 NSW) on 27 September 2006. 5Protected estate management orders affecting the estate of the plaintiff were in force between 27 September 2006 and 21 July 2014. 6On the 2006 date, on the application of his mother, the Court declared that the plaintiff was a person who was incapable of managing his affairs and ordered that the first and second defendants be appointed managers of his estate. 7The occasion for protected estate management orders being sought, and made, was the plaintiff's recovery, in October 2005, of an award of personal injuries compensation (in proceedings instituted in the District Court of NSW by his mother as his tutor) arising out of injuries suffered by him in a motor vehicle accident in 1987, shortly after his birth. The District Court proceedings had been settled for $2 million, plus costs, less specified deductions, leaving a balance of approximately $1.725 million. 8There is no reliable evidence before the Court as to whether (and, if so, in what sum) an allowance for gratuitous care was included in calculation of the compensation awarded, by way of a settlement, in favour of the plaintiff. 9The plaintiff undoubtedly claimed a head of damages by reference to Griffiths v Kerkemeyer (1977) 139 CLR 161; but that was part of a large ambit claim determined by compromise, not by judicial decision. 10The Court record is silent about the make up of the compensation awarded. The evidence of steps taken towards the parties' compromise falls short of addressing whether any specific allowance was made for care of the plaintiff, past or prospective. 11The NSW Trustee and Guardian Act 2009 NSW repealed and replaced the Protected Estates Act 1983 NSW, with effect from 1 July 2009. Transitional provisions ensured that orders made under the 1983 Act continued in operation under the 2009 Act. 12By a summons filed on 19 May 2014 in the current proceedings (numbered 2014/00150915 in the Protective List of the Equity Division of the Court) the plaintiff applied for orders, under s 86 of the NSW Trustee and Guardian Act 2009 NSW, that the management orders affecting him be revoked. 13The plaintiff's summons was supported by affidavits sworn, inter alia, by himself and the second defendant, but not by evidence as to the respective attitudes of the first defendant and the plaintiff's wife. 14When the proceedings came before me in chambers, I (on 1 July 2014) gave directions designed to ensure that the evidence was duly supplemented to ensure that the Court could make an informed decision on the summons. Those directions included a direction that the NSW Trustee and Guardian (the NSW Trustee) file and serve a report setting out, in summary terms, the financial circumstances of the plaintiff so far as known to the NSW Trustee. 15The same directions provided for the proceedings to come before me, in court, as the Protective List Judge, on 21 July 2014 and for the plaintiff, subject to further order, to use his best endeavours to be personally present in court on that occasion. 16In compliance with the Court's orders, the NSW Trustee filed a report on 17 July 2014 and the plaintiff personally attended court on 21 July 2014. 17On that occasion I made notations and orders that included the following (with emphasis added): "5. NOTE that the report of the NSW Trustee records facts which, if established, suggest that the managers of the plaintiff's estate (his mother, the first defendant, personally, and the second defendant, his grandmother, vicariously) may have been in default of their obligations as managers. 6. DECLARE, pursuant to s 86(1) of the NSW Trustee and Guardian Act 2009 NSW, that the plaintiff is capable of managing his affairs. 7. ORDER, pursuant to s 86(1)(a) of the NSW Trustee and Guardian Act 2009, that the declaration made on 27 September 2006 that the plaintiff is a person who is incapable of managing his affairs be revoked. 8. ORDER, pursuant to s 86(1)(b) of the NSW Trustee and Guardian Act 2009, that the order made on 27 September 2006 for the appointment of the defendants as managers of the estate of the plaintiff be revoked. 9. ORDER, pursuant to s 86(1)(c) of the NSW Trustee and Guardian Act 2009 that the defendants jointly and severally: (a) take such steps as may be necessary or expedient to transfer control and management of the estate of the plaintiff to the plaintiff; and (b) on or before 4 August 2014 or such other time as may be appointed by the NSW Trustee and Guardian, lodge with the NSW Trustee and Guardian such accounts as the NSW Trustee and Guardian may require in writing from them, jointly or severally, in relation to their management of the estate of the plaintiff. 10. ORDER that the defendants, by themselves their servants and agents, be restrained from acting, or holding themselves out as entitled to act, as managers of the estate of the plaintiff. 11. RESERVE for further consideration what, if any, orders may be necessary or desirable to enforce obligations of the defendants, jointly or severally, to account for their management of the plaintiff's estate. 12. ORDER that the NSW Trustee be at liberty, subject to any further order of the Court, to retain within its possession, custody or control, any property of the plaintiff currently held by it pending payment by the plaintiff of any fees, costs or disbursements payable by or on behalf of the plaintiff. 13. ORDER that the costs of the plaintiff, the second defendant and the NSW Trustee be paid by the plaintiff or out of his estate.... 15. RESERVE to all parties liberty to apply to the Protective List Judge generally." 18A declaration that a person formerly in need of protection is capable of managing his or her affairs implicitly carries with it "liberty to apply" to the Court for orders necessary to give effect to the declaration and consequential orders for revocation of management orders affecting him or her: Royal Insurance Co Limited v Mylius (1926) 38 CLR 477 at 497; NSW Trustee and Guardian Act 2009 NSW, s 86(1)(c). In this instance, there was also an express reservation of liberty to apply. 19A reservation of liberty to apply after a grant of final relief (such as a declaration under s 86(1) of the NSW Trustee and Guardian Act 2009 NSW that a protected person is capable of managing his or her affairs) enables further orders to be made which are necessary for the purpose of "working out" the principal relief earlier granted (that is, for the purpose of implementation of, and giving effect to, that principal relief): Australian Hardboards Limited v Hudson Investment Group Limited (2007) 70 NSWLR 201 at 213 [50] - 221 [77]. 20Reservation of a question "for further consideration" enables that question and ancillary business, not disposed of by orders thus far made, to be dealt with on a later occasion: 70 NSWLR 220 [72] - 221 [77]. There was, in this case, an express reservation of a question for further consideration as well as liberty to apply. 21The proceedings next came before me on 4 August 2014, at which time the first defendant agitated her claim for an allowance out of the plaintiff's estate. 22In order to facilitate the orderly disposition of that claim I made orders to the following effect: "1. Order that each of the first and second defendants (formerly managers of the estate of the plaintiff) deliver to the NSW Trustee, and serve on the solicitor for the plaintiff, no later than a specified date: a) a written statement of all claims she seeks to make against the estate of the plaintiff; b) the evidence relied upon by her in support of each such claim; c) a statement accounting for her dealings with the estate of the plaintiff under her management. 2. Order that the plaintiff deliver to the NSW Trustee, and serve on each of the first and second defendants, no later than a specified date: a) a written statement in response to any claim made against his estate pursuant to order 1(a); b) a written statement in response to any form of accounting provided pursuant to order 1(c); and c) any evidence relied upon by him in relation to the subject matter of order 1. 3. Direct that the NSW Trustee provide to the Court (and serve on all interested persons) no later than a specified date a report to the Court on the subject matter of orders 1 and 2, including: a) a copy of all written materials delivered to the NSW Trustee pursuant to order 1; b) a copy of all written materials provided to the NSW Trustee pursuant to order 2; c) a summary statement, if practicable, of the nature of the issues between the parties in relation to the subject matter of orders 1 and 2; d) such, if any, observations as the NSW Trustee is able to make about the merits of the parties' respective contentions on the subject matter of orders 1 and 2 and about the sufficiency of any evidence relating to claims made on the estate of the plaintiff; e) such, if any, observations as can be made by the NSW Trustee as to the sufficiency or otherwise of the former managers' accounting for their management of the estate of the plaintiff." 23By successive applications to judges other than myself, in the duty judge list, the first defendant secured variations in the timetable ordered on 4 August 2014, resulting nevertheless in the proceedings returning to me (as planned) as the Protective List Judge on 24 November 2014. 24As a formal expression of her claim, the first defendant had by that time filed a notice of motion (initially on 4 November 2014, and in an amended form on 14 November 2014) in which she claimed relief to the following effect: (1) an order that the NSW Trustee and/or its servants or agents and/or the Managers of the plaintiff's estate be restrained from appropriating any part of that estate to the plaintiff pending a judgment by the Court as to the orders sought pursuant to this Notice of motion. (2) an order, pursuant to s 65(2) of the NSW Trustee and Guardian Act 2009 NSW, directing the NSW Trustee to pay to the First defendant the sum of $500,000, being an amount equivalent to the commercial value of domestic services gratuitously rendered by the First defendant to the plaintiff, between [the date in 1987 when the plaintiff suffered personal injuries for which he was compensated in the District Court proceedings] and 2006 [when he commenced living independently of his mother and grandmother], being the time that the plaintiff ceased to reside with the first defendant. (3) in the alternative to order 2, an order that the plaintiff pay to the First defendant the sum of $500,000, being an amount equivalent to the commercial value of the domestic services gratuitously rendered by the First defendant to the plaintiff, between 1987 and 2006, being the time that the plaintiff ceased to reside with the First defendant. (4) an order that the NSW Trustee pay the First defendant's costs of and incidental to this Notice of motion. (5) in the alternative to order 4, an order that the plaintiff pay the First defendant's costs of and incidental to this application." 25No claim has been made against the plaintiff or his estate by the second defendant. 26In compliance with the orders made by the Court on 4 August 2014, the NSW Trustee filed a report dated 20- 21 November 2014. 27Upon a review of the proceedings on 24 November 2014 I invited the active parties (the plaintiff and the first defendant), and the NSW Trustee, to submit to a hearing of the first defendant's claim the next day, 25 November 2014. That invitation was taken up. 28The first defendant's quantification of her claim in the sum of $500,000 has an air of unreality about it for several reasons: (a)first, it is a disproportionately large share of, both, the compensation awarded to the plaintiff and the current value of his estate (about $1.8 million). (b)secondly, it far exceeds a claim for an allowance (in the sum of $39,000) foreshadowed by the first defendant shortly before the plaintiff sought, and obtained, an order for revocation of the management orders affecting him. (c)thirdly, the first defendant's claim must be assessed in the context of a continuing failure by her, as a manager of the plaintiff's protected estate, to account for her dealings with estate property. (d)fourthly, as was confirmed during the hearing of the first defendant's motion, in an affidavit sworn by her on 24 November 2014 in response to the NSW Trustee's report dated 20-21 November 2014, in May-June 2014 the first defendant deliberately appropriated to herself, from the plaintiff's protected estate under her joint management, a sum of not less than $45,000, which she has neither repaid nor offered to repay to the plaintiff. (e)fifthly, although the first defendant did provide parental care for the plaintiff, and did act as his tutor in the District Court proceedings that culminated in an award of compensation to him, much of the burden she bore as a parent in the provision of care for the plaintiff was, in fact, borne by the second defendant, with whom the plaintiff lived for several years and to whom (evidently to the exclusion of the first defendant) he acknowledges filial obligations. 29Although counsel for the first defendant, in thoughtful submissions, acknowledged that any allowance that might be made in favour of the first defendant out of the protected estate of the plaintiff is (at its highest) entirely within the discretion of the Court, the first defendant herself appears to have developed a sense of entitlement to a share of the compensation awarded to her son. That sense of entitlement explains, but cannot justify, her use of part of the plaintiff's protected estate for her own personal purposes. 30The first defendant's application for an allowance for past gratuitous care must fail, whether it is directed towards the plaintiff's estate or him personally. There is no principled basis upon which the Court can properly make an order for an allowance to be paid to her out of the plaintiff's estate, whether or not one disregards the orders made for revocation of the management orders affecting him. There is no foundation, whatsoever, for an order against the plaintiff personally, unrelated to his property. 31The relief sought by the first defendant starts with the premise that she provided gratuitous care for the plaintiff. 32From that point of commencement, she can have no cause of action, or equity, against him personally, and no justiciable cause for complaint if he declines to recognise her call upon him for assistance. 33The plaintiff is and was at all material times under no legal liability to pay for whatever services may have been provided to him by the first defendant. Even if it could be established that the compensation he recovered with her assistance included a component specifically referable to her gratuitous care, that fact alone would provide no foundation under the Australian law for imposition of a legal, or equitable, obligation on him to pay her anything: Griffiths v Kerkemeyer (1977) 139 CLR 161 at 177 and 193-194; Kars v Kars (1996) 187 CLR 354 at 368-372. 34The first defendant's claim for an allowance out of the plaintiff's estate is no better placed. 35The Court's inherent, protective jurisdiction extends to authorisation of a voluntary allowance or donation out of a protected estate, not limited to allowances for the maintenance or benefit of a protected person's family, although family may be natural objects of beneficence: HS Theobald, The Law Relating to Lunacy (Stevens & Sons, London, 1924), chapter 65 (pp 463-467); Protective Commissioner v D (2004) 60 NSWLR 513 at 540-542, 543 and 544-545; Griffin v Union Trustee Co of Australia Limited (1947) 48 SR (NSW) 360 at 363; 65 WN (NSW) 5 at 7; Re DJR and the Mental Health Act 1958 (1983) 1 NSWLR 557 at 564 Eg; Re ES and the Mental Health Act 1958 [1984] 3 NSWLR 341 at 343B344D; Singh (bhnf Singh) v Calvary Hospital ACT Inc & Anor [2008] ACTSC 118 at [38]; Scott v Scott [2012] NSWSC 1541; 7ASTLR 299 at [287]; Secretary, Department of Family and Community Services v K [2014] NSWSC 1065 at [7]; W v H [2014] NSWSC 1596 at [51]; L v L [2014 NSWSC 1686 at [35]. 36As noticed in W v H [2014] NSWSC 1696 at [52]-[53]: Where (as in these proceedings) the estate of a protected person is managed by a private manager (ie, a manager other than the NSW Trustee) the Court's inherent jurisdiction is supplemented by the NSW Trustee and Guardian Act 2009 NSW, s65. 37Section 65 (upon which the first defendant expressly relies) is in the following terms, with emphasis added: "65 Orders by Supreme Court and NSW Trustee as to property (1) General power. The Supreme Court or the NSW Trustee may make such orders as appear to it necessary for rendering the property and income of a managed person available for the following purposes: (a) the payment of the debts and engagements of, and otherwise for the benefit of, the person, (b) the maintenance and benefit of the family of the person, (c) otherwise as it thinks necessary or desirable for the care and management of the estate of the person. (2) Orders as to disposal of estate Without limiting the generality of subsection (1), the Supreme Court or the NSW Trustee may order that any property of the person be sold, mortgaged, dealt with or disposed of as the Court or the NSW Trustee thinks most expedient for the purpose of raising or securing or repaying with or without interest money which is to be or which has been applied to any one or more of the following purposes: (a) payment of the person's debts or engagements, (b) discharge of any encumbrance on property of the person, (c) payment of any debt or expenditure incurred for the maintenance (including future maintenance), or otherwise for the benefit, of the person, (d) payment of the costs of any proceeding under this Act or of any sale or other disposition made under this Act, (e) payment of such other sum or sums to such person or persons as the Court or the NSW Trustee thinks fit. (3) Orders as to application of money. Without limiting subsection (1), the Supreme Court or the NSW Trustee may authorise and direct the application of money comprising the whole or any part of the estate of the person to any one or more of the following purposes: (a) the preservation and improvement of the estate of the person, (b) the taking up of rights to issues of new shares, or options for new shares, to which the person may become entitled by virtue of any shareholdings, (c) the investment of money, being money not required for the time being for any of the other purposes specified in this subsection, in such manner as the Court or the NSW Trustee thinks fit. (4) An order by the NSW Trustee is subject to the regulations or to any order of the Supreme Court or to any order of the Civil and Administrative Tribunal (in the case of a person under guardianship)." 38Section 65 confers powers on both the Court and the NSW Trustee. However, given the breadth of the Court's inherent jurisdiction (not displaced by statute) the section adds nothing material to the first defendant's claim for relief. 39Section 65 does, however, attract the general principles articulated in s39 of the NSW Trustee and Guardian Act 2009 NSW. 40Both sections appear in chapter 4 of the Act, entitled "Management functions relating to persons incapable of managing their affairs." 41Section 39 is in the following terms: "39 General principles applicable to Chapter [4] It is the duty of everyone exercising functions under this Chapter with respect to protected persons ... to observe the following principles: (a) the welfare and interests of such persons should be given paramount consideration, (b) the freedom of decision and freedom of action of such persons should be restricted as little as possible, (c) such persons should be encouraged, as far as possible, to live a normal life in the community, (d) the views of such persons in relation to the exercise of those functions should be taken into consideration, (e) the importance of preserving the family relationships and the cultural and linguistic environments of such persons should be recognised, (f) such persons should be encouraged, as far as possible, to be self-reliant in matters relating to their personal, domestic and financial affairs, (g) such persons should be protected from neglect, abuse and exploitation." 42These principles, thus stated, are a statutory embodiment of the jurisprudence that informs the Court's inherent jurisdiction: M v M [2013] NSWSC 1495 at [43]. 43The inherent jurisdiction over the property and person of a person in need of protection is extremely wide: PB v BB [2013] NSWSC 1223 at [29]. Its limits have never been, and cannot, from the nature of the case, be defined: Theobald, p 362; Secretary, Department of Health and Community Services v JWB and SMB (Marion's Case) (1992) 175 CLR 218 at 258. Nevertheless, although the jurisdiction may be theoretically unlimited in scope, it must be exercised in accordance with its informing principles: E (Mrs) v E (also known as Re Eve) [1986] 2 SCR 388 at 414; 31 DLR [4th] 1 at 19 (approved in Marion's Case at 175 CLR 258). 44The jurisdiction is purposive in character: GAU v GAV [2014] QCA 308 at [48]. Its purpose, at its highest level of abstraction, is protection of a person in need of protection. Its guiding principle is that whatever is done, or not done, for or on behalf of a person in need of protection must be for the benefit, and in the interests, of that person. 45Leaving to one side any complication in the first defendant's case arising from revocation of the management orders affecting the plaintiff, the fact that the plaintiff is and was at all material times a person capable of expressing a rational view about the proper disposition of his estate presents a formidable impediment to the first defendant's claim. 46Section 39 expressly requires the Court to take his views into consideration upon any exercise of power under s 65. 47An exercise of inherent jurisdiction is no less mindful of the importance of a protected person's judgement about whether voluntary allowances should be made out of an estate. That can be seen in the foundational judgment of Lord Eldon in Ex Parte Whitbread In the matter of Hinde, a Lunatic (1816) 2 Mer 99 at 101-103; 35 ER at 879, extracted in W v H [2014] NSWSC 1696 at [40]. 48Lord Eldon grounded his reasoning (still reflected in the general law relating to protected estate management) on a proposition that "[the] Court does nothing wantonly or unnecessarily to alter [a protected person's] property, but on the contrary takes care for his [or her] sake, that, if he [or she] recovers, he [or she] shall find his [or her] estate as nearly as possible in the same condition as he [or her] left it, applying the property in the meantime in such manner as the Court thinks it would have been wise and prudent in the [protected person] himself [or herself] to apply it, in case he [or she] had been capable". 49In holding that "the Court will not refuse to do, for the benefit of [a protected person], that which it is probable the [protected person"] himself [or herself] would have done", Eldon LC placed the perspective of the protected person at the centre of the Court's consideration of an exercise of protective jurisdiction. 50I have now observed the plaintiff give evidence, in support of his own interests, on two separate occasions. On 21 July 2014, he demonstrated such command of himself and his personal affairs that I was persuaded to find (in terms of s 86(1) of the NSW Trustee and Guardian Act 2009 NSW) that he was capable of managing his own affairs. On the hearing of the first defendant's motion on 25 November 2014, he vindicated that judgement when cross examined by counsel for the first defendant. 51His capacity for self-management includes an ability to articulate rational reasons, not without a reasonable foundation, in opposition to his mother's claim for assistance at his expense. 52It is not necessary, or appropriate, for me to resolve disputes between mother and son about particular facts relating to their relationship or her care for him. Any attempt to do so could impose a substantial costs burden on everybody and run counter to a cardinal principle (confirmed by Theobald, at p 382) that protected estate management should be directed to administration of an estate "without strife in the simplest and least expensive way". The first defendant's claim for a discretionary allowance at the expense of the plaintiff provides no occasion for adversarial litigation. 53I am confident that the plaintiff can manage his own affairs and that he is not acting irrationally, or unreasonably, in resisting his mother's claim. That point having been reached, deference for his autonomy demands that I respect his judgement in making decisions about management or disposition of his property. 54It is and was at all material times his property. Throughout the time his estate was actively under protective management, the plaintiff retained title to it. The scheme of the NSW Trustee and Guardian Act 2009 NSW, and of the general law underlying it, is that a protected person retains title to his or her property, but that his or her estate is managed on his or behalf by the person appointed as manager: GDR v EKR [2012] NSWSC 1543 at [36]; Ability One Financial Management Pty Limited and Anor v JB by his tutor AB [2014] NSWSC 245 at [174]-[175]. The first defendant's stewardship of the plaintiff's estate (property), as a joint manager of the estate, did not confer upon her, or take away from him, title to his property. 55On the contrary, by assuming the office of a protected estate manager, the first defendant voluntarily accepted the obligations of a fiduciary vis á vis the plaintiff: Ability One Financial Management Pty Limited and Anor v JB by his tutor AB [2014] NSWSC 245 at [166]-[175]. 56As a fiduciary, she was obliged to act at all times, in the interests of the plaintiff, in good faith. She was required, moreover, to avoid conflicts between her personal interests and her duty to the plaintiff, and to take no unsanctioned gains from her office. She was obliged to act as a protected estate manager gratuitously, and to take no financial reward for performance of the duties of her office without the authority of the Court or (pursuant to a statutory power or a direction of the Court) the NSW Trustee or its statutory predecessor, the Protective Commissioner. She was, and she remains, under a duty to account to the plaintiff for all her dealings with his property, including her appropriation of his property for her personal benefits. 57By diverting part of the plaintiff's estate to herself, the first defendant failed in her obligation to the plaintiff as an accounting party. Her deliberate appropriation of more than $45,000 of the plaintiff's estate to her own purposes went beyond a mere sharing of the benefits of being a member of the same household as the plaintiff (Countess of Bective v Federal Commissioner of Taxation (1932) 47 CLR 417 at 422-423) or the making of a reasonable, conventional gift (authorised by the NSW Trustee and Guardian Act 2009 NSW, s 76). 58Her failure to account for estate property provides, in itself, a substantial impediment against the Court making an order that she be granted a discretionary allowance out of the plaintiff's estate. Just as an executor may be denied commission if guilty of a breach of trust, neglect or disregard of fiduciary obligations, so too may a manager be denied an allowance out of the estate under management if in breach of the fiduciary obligations of a protected estate manager: Cf, Re Estate Gowing [2014] NSWSC 247; 17 BPR [98635] at [67]-[69]. 59There is no basis upon which the first defendant's breach of fiduciary duties can be excused in the circumstances of this case, whether by reference to the statutory jurisdiction of the Court (under s 85 of the Trustee Act 1925 NSW) to excuse a breach of trust, or upon an exercise of the Court's general, inherent jurisdiction over the due administration of protected estates or trusts: cf, Ability One Financial Management Pty Limited and Anor v JB by his tutor AB [2014] NSWSC 245 at [42]. In helping herself to funds from the plaintiff's protected estate, without any grant of authority by the Court or the NSW Trustee, the first defendant could not be described (as she must be, if she is to be excused) as having acted fairly, honestly and reasonably. 60Had I been satisfied (which I am not) that an allowance could and should be paid to her out of the estate of the plaintiff, her unauthorised conduct in helping herself to the protected estate would have been a sufficient ground for dismissal of her motion. 61As it happens, in any event, the first defendant's misapplication of money from the estate of the plaintiff far exceeds the amount of her foreshadowed claim for a discretionary allowance, as well as any amount that could properly have been ordered by the Court in her favour. More than a nominal sum could not have been ordered in her favour without adverse effect on the welfare of the plaintiff. He is a young man with a young family, and needs, of his own. 62For completeness, I record that I accept that the Court has jurisdiction to order that provision be made for the first defendant out of the estate of the plaintiff notwithstanding orders having been made for revocation (pursuant to the Trustee and Guardian Act 2009 NSW, s 86) of the management orders affecting him. 63A finding of jurisdiction is supported by a number of considerations. In short, property of the plaintiff remains within the control of the Court as the Court's orders for revocation of the management orders affecting the plaintiff are worked out. First, s 86(1)(c) specifically authorises the Court to "make any orders that appear to it to be necessary to give effect" to the revocation of management orders. I take that language as sufficient to authorise the making of consequential orders beyond an order that, in terms, revokes a management order. Secondly, the orders made for revocation of the management orders in these proceedings reserved questions of accounting for further consideration. Thirdly, an order for an allowance to a protected estate manager, out of a protected estate, is, in substance, an order directed towards accounting for the estate. Fourthly, the NSW Trustee still retains about $190,000 on trust for the plaintiff, subject to orders of the Court. That trust fund, in particular, is susceptible to further orders in working out the Court's revocation orders. 64The first defendant's motion must be dismissed for want of merit, not because of a lack of jurisdiction. Upon an application of principles governing an exercise of protective jurisdiction, it must fail. The Court cannot reasonably conclude (as it must, if the first defendant is to succeed) that an allowance in favour of the plaintiff would serve his interests and be for his benefit. Nor can it reasonably reach such a conclusion in light of its determination that he has capacity for self-management, which he has ostensibly exercised rationally and responsibly. Even if the Court could otherwise justify an exercise of discretion in her favour, the first defendant's continuing failure to account for her stewardship of the plaintiff's estate as a manager bars her way. Her motion must be dismissed. 65Dismissal of the motion does not, of itself, bring to an end the process of working out the orders for revocation of the management orders affecting the plaintiff. 66The failure of the defendants to account for their management of the plaintiff's protected estate requires attention. In that regard, however, I record that, in the hope that he might be able to bring all proceedings between him and his mother to an end, the plaintiff indicated, in closing submissions, a preparedness (contingent upon dismissal of her motion) to waive any unfulfilled requirement for a formal accounting from his mother. 67The appropriate, measured response on the part of the Court to this is: (a) to direct that the NSW Trustee take no further action to require an accounting from the defendants; (b) to leave to the plaintiff himself, personally, the task of taking such, if any, steps he may be advised to take to enforce his entitlement to have the defendants (more particularly, the first defendant) restore to his estate moneys diverted from it; and (c) to reserve, for a specified time, his right to take such enforcement action in these proceedings if, on reflection, he is minded to do so. 68Orders to this effect can be justified, not only as orders for the working out of the Court's declaration that the plaintiff is capable of managing his affairs, but as orders (within the meaning of s 86(1)(c) of the NSW Trustee and Guardian Act 2009 NSW) "necessary to give effect to the revocation" of the 2006 order that the estate of the plaintiff be subject to management under the Act; as (within the meaning of s 64 of the Act) orders "in relation to the administration and management" of the plaintiff's protected estate; or as (within the meaning of s 65 of the Act) orders "for the care and management" of the plaintiff's estate. These statutory powers are to be construed liberally, in service of their beneficial, protective purpose (Protective Commissioner v D (2004) 60 NSWLR 513 at 543 [167]), having regard to the general principles elaborated in s 39 of the Act, informed by the protective character of the Court's inherent jurisdiction: RL v NSW Trustee and Guardian (2012) 84 NSWLR 263 at 284-285 [93]-[94] and [96]. 69In the circumstances of this case, dismissal of the first defendant's motion should carry with it an order that the first defendant pay the plaintiff's costs of the proceedings on and after 4 August 2014, including any costs of the NSW Trustee in the first instance payable by the plaintiff or out of his estate. 70Although the first defendant's application for an allowance out of the plaintiff's estate ultimately found expression in a notice of motion filed on 4 November 2014 and amended on 14 November 2014, it was in fact made, or formally foreshadowed, much earlier. At that earlier time it impacted on administration of the plaintiff's estate, both by postponing a "release of the estate of the [plaintiff] from the control of the Court or the manager" (to paraphrase s 86(1)(c) of the NSW Trustee and Guardian Act 2009 NSW) and by requiring an expenditure of resources by both the NSW Trustee and the plaintiff. 71With this in mind, a fair, practical nomination of the time from which the first defendant's liability for costs associated with her application should commence is 4 August 2014, on which date she pressed her claim in court and had the benefit of directions for its orderly determination. 72The Court has ample powers to make orders dealing with costs of the proceedings. Section 98 of the Civil Procedure Act 2005 NSW provides, inter alia, that costs (including the costs of administration of any estate or trust) are in the discretion of the Court, with full power to determine by whom, to whom and to what extent costs are to be paid. The Trustee Act 1925 NSW, by s 93(2), provides, inter alia, that, in any proceedings with respect to management or administration of any property subject to a trust, the Court may order that costs be paid out of the trust property. 73The ordinary rule in the protective jurisdiction is that the Court exercises its discretion as to the costs of proceedings, not by reference to a rule that costs follow the event, but having regard to what, in all the circumstances, seems proper: CCR v PS (No 2) (1986) 6 NSWLR 622 at 640; M v M [2013] NSWSC 1495 at 50. Nevertheless, where a party (such as the first defendant) unsuccessfully pursues an application in an adversarial manner, it may be (and in this case is) proper for that party to bear the costs of the application: Ho v NSW Public Guardian [2013] NSWSC 1788 at [15]-[16]. 74Costs incurred by the NSW Trustee (including the cost of preparation of a report under the direction of the Court), necessary for the proper determination of the first defendant's application, in the course of working out orders for revocation of management orders, should, in the first instance, be paid by the plaintiff or out of his estate: more particularly, from that part of the estate presently held by the NSW Trustee pending further orders of the Court. To the extent that the plaintiff bears the burden of any such costs, he should be indemnified by a costs order in his favour against the first defendant. 75Whether, and to what extent, the plaintiff enforces any order against the first defendant, for costs or an accounting, is a matter for him. 76I do not intend, by this observation, to do more than to invite him to consider whether, all things considered, his interests might be best served by bringing these proceedings to an end sooner, rather than later, whatever might be (as I have held) his strict legal entitlements.

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JPT v DST

At a glance

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Judgment (6 paragraphs)

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Cases Cited (22)

Cited By (11)