MQN (No 2) [2018] NSWCATGD 47

Preliminary matters - representation

1. NZG and MBL sought the Tribunal's consent to their representation by Ms Madeleine Gilmour, barrister, and MBL asked also for consent to her being represented additionally by Mr John Warburton, solicitor. DVN sought consent to be represented by Mr Todd Alexis SC.
2. Mr Warburton explained his role as being essentially to represent MBL in relation to any aspects of the matters where her interests or concerns might diverge from those of NZG. He said that he expected, in practice, to play little if any role in proceedings. The Tribunal noted the somewhat unusual nature of Mr Warburton's proposed role but was unconcerned by it.
3. Mrs Gilmour and Mr Alexis SC argued that consent should be granted for them to appear in view of: 1. The complexity of the issues raised by the applications; 2. The significant value the interests potentially at stake; and 3. Their respective consistent involvements in all the matters since the directions hearing on 4 May 2017.
4. The Tribunal was satisfied that: 1. for the reasons outlined by Mrs Gilmour and Mr Alexis, legal representation by them, and 2. in the particular circumstances of the applications, for Mr Warburton to represent MBL within the limited scope which he proposed, would assist the Tribunal consistently with the guiding principles set out in s 36 of the Civil and Administrative Tribunal Act 2013 (NSW). Accordingly, the Tribunal gave the consents requested.

Preliminary matters - participation by MQN

1. The Tribunal had previously decided that, in view of MQN's impaired cognition, there was nothing to be lost by relieving NZG, MBL and DVN from the obligation to serve documents on her.
2. The Tribunal considered whether, similarly, it was appropriate for the substantive hearings to proceed without MQN's participation. On this issue: 1. NZG, MBL and DVN agreed that their mother would not be able either to understand or usefully to participate in the hearing; 2. The Tribunal noted the letter dated 31 July 2017 from Dr Z, of a medical centre, MQN's usual doctor, confirming the extent and disabling effect of her progressive dementia, and her inability to attend any hearings; 3. Ms Y, Ms X and Ms W, all of the aged care facility north of Sydney, provided uncontested oral evidence concerning MQN's limited cognition; and 4. The Tribunal noted that the matters at issue in the hearing went, not to matters of MQN's current state of mind, but rather to certain historical matters on which she could now shed little light, as well as certain divergences of view between her children as to how best to make decisions for her in the light of her impaired cognition. Having regard to these matters, the Tribunal decided that it was appropriate to proceed with the hearing without MQN's participation.

Preliminary matters - confidentiality request

1. One of the orders made by the Tribunal on 17 October 2017 was for DVN by 24 January 2018 to provide to the Tribunal and the other parties (excluding MQN, in view of the order of 22 June 2017 referred to in [6(3)] above) "… a summary of his assets and liabilities (with significant contingent liabilities noted) at or about that date…". DVN made no objection during the relevant directions hearing to providing that information to his sisters, but at the time of delivering the information to the Tribunal his solicitor requested that "…it not be provided to the applicants or any other person without the respondent first being given an opportunity to be heard...". NZG and MBL sought on 28 January 2018 an order that DVN provide that information to them.
2. At the hearing on 7 February 2018: 1. It was common ground between all parties that, through guarantees executed by MQN on 25 November 2005 and a mortgage by MQN dated 30 December 2005, Property A secured borrowings by DVN and his wife, EJN from Bank Z, which were also secured over other properties in the property portfolio owned by him and EJN. 2. Mr Alexis said that DVN sought confidentiality for the summary on two grounds: first, since DVN co-owned all relevant assets with EJN, disclosure of the summary would necessarily involve the disclosure of information of a sensitive and confidential nature concerning her, to which she objected; and secondly, the information had been requested by the Tribunal itself, to assist it in its deliberations, and it was not appropriate that sensitive and confidential information which went into some detail as to DVN and EJN's financial affairs and which NZG and MBL had not considered sufficiently relevant as themselves to seek its disclosure at the directions hearing should be disclosed to them. 3. Mrs Gilmour objected, and emphasised the terms of the order, the opportunity which DVN had at the directions hearing to object to the disclosures, and his failure to do so.
3. After considering these submissions, the Tribunal decided: 1. To order in exercise of its powers under s 64(d) of the Civil and Administrative Tribunal Act that the summary be kept confidential and not be available for review by any party to the applications; but 2. To provide a summary to the parties of those elements disclosed which, from the Tribunal's perspective: 1. were responsive to the matters on which it had sought information; and 2. were potentially relevant to its determination of the substantive applications.
4. This information, which the Tribunal summarised to the parties, was as follows: 1. DVN and EJN had at the relevant date a net worth (that is to say, total assets minus total liabilities, including their debt to Bank Z) of at least $5 million dollars; and 2. The composition of their assets was, relevantly, 61% residential or retail real estate which could reasonably be expected to be realised within the timeframes typical for the sale of real estate of the relevant kind, and 35% marketable securities or cash which could reasonably be expected to be realised virtually immediately. The balance comprised assets whose realisation could well take an extended period.
5. The Tribunal was particularly conscious of three considerations: 1. First, EJN's legitimate concerns as to confidentiality of her affairs; 2. Secondly, in ordering provision of the information the Tribunal wished to ascertain whether: 1. DVN had any current structural financial difficulties which might motivate him to make use of his mother's money for his purposes; or 2. His personal gearing was such as to expose MQN's interest in Property A to risk should interest rates rise; disclosure of the minimum net worth figure was sufficient to allow both concerns to be pursued on an adequately informed basis; and 1. Thirdly, the Tribunal also wished to ascertain whether MQN was at financial risk because Property A offered DVN's secured creditors a more readily realisable asset to which they might prefer to have recourse over other and perhaps less readily realisable assets; disclosure of the composition of DVN and EJN's assets was adequate to allow this concern to be addressed on an adequately informed basis. Having regard to these conclusions, the Tribunal decided to make the confidentiality order requested.

GUARDIANSHIP APPLICATION

1. The substantive matters addressed on the first day of the hearing went to guardianship matters. The Tribunal drew three significant conclusions from the evidence: 1. The evidence provided by Dr Z in his report referred to above, and orally by Ms Y, Ms X and Ms W, was consistent with the common position adopted by NZG, MBL and DVN, that MQN has a disability which significantly impairs her ability to make important non-financial decisions; 2. The evidence provided orally by Ms Y, Ms X and Ms W, and that provided both orally and in writing by NZG, MBL and DVN, was that: 1. MQN is settled and well-cared for at the aged care facility; 2. there is no proposal that she be moved from the aged care facility; 3. in addition to the services and care she receives there, she receives as required supplemental physiotherapy organised by her family; 4. there is little by way of additional services - such as the provision of occasional Italian speaking companions, which was an issue raised by the Tribunal during the hearing - which can realistically improve her welfare; 5. the only decisions for her which are likely to be required in the foreseeable future concern her medical and dental treatment; 6. NZG remains the person having care of MQN for purposes of s 3D of the Guardianship Act 1987 (NSW), because at the time at which MQN became a resident of the aged care facility she had been providing her mother with domestic services and support on an unremunerated basis; 7. NZG, as the person having care of MQN and a close relative, and MBL and DVN, as close relatives, are all recognised under Pt 5 of the Guardianship Act as persons responsible for purposes of making medical and dental treatment decisions for their mother with NZG, as carer, having a higher position in the statutory hierarchy for medical and dental decision making than her siblings, who rank equally with one another; and 8. whatever the tensions between the siblings concerning their mother's financial affairs, they share a common concern to ensure her personal care and wellbeing, and a preparedness to communicate with one another on these matters. 1. In consequence, a workable mechanism exists for the making of medical and dental treatment decisions for MQN, so that there is no evident need for a guardianship order.
2. This was a conclusion which the Applicant also arrived at during the hearing, and consequently in her closing address Mrs Gilmour sought leave on NZG's part (and with MBL's consent) to withdraw the guardianship application. DVN supported this application. The Tribunal was satisfied in all the circumstances that: 1. there was no need for a guardianship order, and 2. MQN's welfare and interests did not dictate any other conclusion, and accordingly dismissed the guardianship application.

APPLICATION FOR THE REVIEW OF AN ENDURING POWER OF ATTORNEY

What the Applicant requests

1. In her application for the review of the enduring power of attorney granted in favour of DVN by MQN on 15 July 2011, NZG asks the Tribunal to review pursuant to s 36 of the Powers of Attorney Act 2003 (NSW) both: 1. the making of the EPA; and 2. the operation and effect of the EPA.

Some initial findings

1. It is undisputed by any party that: 1. The EPA was executed by MQN on 15 July 2011; 2. It appointed DVN as MQN's attorney with effect from his acceptance of the appointment; 3. It was expressed to be given with the intention that it continue to be effective if MQN lacked capacity through loss of mental capacity after its execution; 4. DVN accepted his appointment on 15 July 2011; 5. MQN's execution was witnessed by Mr G J Dunstan, a solicitor practising in north Sydney; 6. Mr Dunstan was a prescribed witness under the Powers of Attorney Act; and 7. In witnessing MQN's execution of the EPA, Mr Dunstan gave a certificate in the statutorily prescribed form, stating that: 1. he had explained the effect of the EPA to MQN before it was executed; and 2. she appeared to understand the effect of the EPA.
2. Two conclusions follow: 1. First, that the EPA is a reviewable power of attorney within the meaning of the Powers of Attorney Act; and 2. Secondly, it is therefore an instrument which under s 33(2) of that Act the Tribunal has jurisdiction to review.
3. The Tribunal was satisfied that the Applicant: 1. has a genuine concern for the welfare of her mother, and is therefore an interested person under s 35 of the Powers of Attorney Act in connection with a review of the EPA, and 2. accordingly, is entitled under s 36 of that Act to make the application which is under consideration.
4. Having regard to: 1. MQN's age and potential vulnerability; 2. The concerns raised by the Applicant and supported by MBL; and 3. The value of MQN's assets, and her dependence on them to fund her continuing residence at the aged care facility, the Tribunal decided under s 36(2) of the Powers of Attorney Act to conduct the review requested by NZG.

The making of the EPA

1. The essence of the Applicant's argument is that the EPA is flawed by reason of the circumstances in which it was made, and that these flaws justify the Tribunal in setting the EPA aside. The matters on which the Applicant bases this request are as follows: 1. MQN's command of the English language was such that she could not have adequately understood any explanation of its terms or effect to her which was not translated into Italian. She communicated, they said, in "broken English" and her receptive understanding of English was insufficient to allow her to comprehend sophisticated concepts, such as the effect of the EPA when expressed in that language. No proper translation was provided to MQN. We call this basis "the language issue". 2. The meeting at which the EPA was signed lasted, according to Mr Dunstan's time records, 30 minutes, during which MQN not only granted the EPA but also signed a new will. This was an insufficient period for a proper explanation of both documents to be provided, and for Mr Dunstan to satisfy himself as to MQN's understanding of the EPA. We call this basis "the timing issue". 3. Mr Dunstan's instructions concerning the EPA were provided by the proposed attorney, DVN, rather than MQN herself. That DVN, who was both a significant client of Mr Dunstan and the proposed attorney, was the source of the instructions for the EPA raises questions as to the integrity of the process by which it was prepared. We call this "the instructions issue". 4. DVN was present at the execution of the EPA and was himself involved in explaining the purpose and effect of the EPA to her in Italian. Since MQN was largely reliant on DVN in relation to business, commercial and financial matters, this raised concerns as to the independence of judgement which MQN exercised in granting the EPA. We call this "the independent judgement issue".
2. At an early stage in the matter somewhat nuanced suggestions were made to the effect that in July 2011 MQN's cognition was already impaired to such a degree as to raise questions concerning her capacity to grant the EPA. At the hearing, however, this line of argument was not pursued, and in any event: 1. There was no medical or psychological evidence to that effect; 2. The medical reports from 2006 concerning her brain function at that time did not go to the issue; and 3. There was ample observational evidence: 1. from the Applicant, MBL, EJN and Ms V (a former tenant of retail premises at Property A) that signs of possible cognitive difficulties for MQN first started to appear several years later, and had become pronounced only in 2015; and 2. from Ms U, the occupant between January 2009 and January 2012 of an apartment in Property A, that during that period she had daily or near daily contact with MQN, who showed no signs of cognitive difficulties.

The language issue

1. Mr Dunstan gave evidence that although he could not recall in detail the precise terms of the conversation between himself and MQN concerning the EPA at the signing meeting on 15 July 2011, he recalled both the fact of having explained it to her, and his being: 1. Satisfied that she was signing the EPA voluntarily, and 2. Sufficiently satisfied as to her understanding to allow himself to sign the statutory certification that she appeared to understand the effect of the EPA. He followed a standard procedure in explaining EPAs to intending grantors, and while he had no specific recollection of following that procedure in the case of MQN on 15 July 2011, he had no reason to doubt that he had done so.
2. Mr Dunstan was, in the Tribunal's assessment, a cautious and measured witness. He understood the significance of his evidence in the context of the applications and was in the Tribunal's observation frank in noting matters on which he had no or limited recollection, and careful to distinguish positive recollections of events from belief based on (1) his usual professional practice, and (2) the absence of any recollection of departing from that practice. Mr Dunstan was in the Tribunal's assessment a credible witness.
3. Mrs Q, who worked as a legal secretary for Mr Dunstan at the time, gave evidence that she had been present at the meeting. She could not recall specifically Mr Dunstan explaining the EPA to MQN, but since it was his normal practice (as she knew from having participated in previous similar signings) she concluded that he must have done so in this case. She recalled MQN nodding her head affirmatively in response to what Mr Dunstan said to her. She could not recall any specific questions posed to or by MQN concerning the EPA. She recalled MQN as having an accent when speaking English but had no recollection as to the relative sophistication of her command of the language. Mrs Q was, in the Tribunal's assessment, a frank, truthful and reliable witness, although her evidence adds little concerning the language issue.
4. Ms U gave evidence that during her approximately three years of residence at Property A she had spoken to MQN on a daily or near daily basis. During that time, she had frequently participated in conversations in English with MQN and had at no stage observed MQN having any significant difficulty in expressing herself in or understanding conversations in that language. She said that MQN had an Italian accent, her turns of phrase were not necessarily those of a native speaker, and at times she would ask for explanations of expressions she did not understand. She said that the topics of conversation between them included such matters as cooking, family affairs, and local and family gossip. Ms U was, in the Tribunal's assessment, frank and open in her evidence, and had a good recollection of relevant events and circumstances during her occupation of the apartment. The Tribunal considers her to be a reliable witness.
5. Ms V had for some years operated a hair dressing salon in the retail premises of Property A, and in doing so had frequent contact with MQN. She said that in her observation MQN's command of English was limited, to the extent that she had difficulty in participating in extended conversations with other customers at the salon. She described MQN's spoken English as "broken". Ms V did however state that from her observation MQN could arrive at a basic understanding of relatively sophisticated concepts expressed in English if they were explained to her in sufficiently simple language.
6. Mr Alexis spent some time attempting to demonstrate that Ms V had, by reason of DVN's involvement in the termination of her tenancy of the retail space at Property A, a degree of personal hostility towards him which might colour her evidence. Without expressing any view as to the success or otherwise of these efforts, the Tribunal considered that Ms V's statements as to MQN's command of the English language were reliable.
7. EJN gave evidence concerning her observation of MQN's command of English. It was that virtually all communication between herself and MQN before and after her marriage to DVN had been in English, and that whilst MQN's command of English was clearly that of a non-native speaker who had learned the language relatively late in life, it was sufficient for her to understand fully all conversations, although on occasions MQN did require explanations of words or expressions which she did not understand at first hearing. The subject matter of their conversations covered the wide range of topics on which mother-in-law and daughter-in-law typically exchange views. The Tribunal was satisfied that EJN was a frank and candid witness, and that her evidence was credible.
8. Ms W gave evidence that she had regular and frequent dealings with MQN at the aged care facility, and that during those dealings she had occasion to observe MQN's expressive and receptive command of English, since all interaction between staff and residents, and between residents, is conducted in that language. Ms W said that the quality of MQN's English language skills varied from day to day, but that despite her cognitive decline she retained an overall command of English which was functionally adequate and, at times, surprisingly idiomatic. Ms W was in the Tribunal's assessment a reliable witness.
9. DVN himself said that he had attended the signing meeting at his mother's apartment and had provided his mother with a brief explanation both in Italian and English of the EPA, to the effect that the EPA authorised him to sign all documents on her behalf. She had responded to him that she approved the arrangement. The evidence from Mr Dunstan and Mrs Q does not refer to DVN providing an explanation in Italian of the EPA. Mrs Q, however, was very clear in her recollection of MQN indicating her assent to the EPA in the presence of Mrs Q, Mr Dunstan and DVN. Overall, and especially in the light of Mrs Q's corroborative evidence as to MQN's positive assent, the Tribunal was inclined to accept his evidence on this aspect of matters and has no reason to question his statement that he provided a brief Italian language explanation.
10. On balance, therefore, the Tribunal is not satisfied that at the time of the signing meeting for the EPA on 15 July 2011 MQN lacked sufficient command of English to understand the general effect of the EPA. This understanding was, in the Tribunal's view, likely a simple but not inaccurate one, that the EPA conferred on DVN the authority to execute documents on her behalf. As discussed below the EPA appears to have been conceived by MQN and DVN as little more than a formal supplement to the various informal or functional agency relationships which had for well over a decade subsisted between mother and son in relation to the management of her affairs. It appears from the evidence discussed below that this is how it has in fact operated. The evidence as to her English language skills is that they were sufficient for her to grasp explanations in simple terms of relatively sophisticated concepts and in the Tribunal's view the characterisation of the EPA as a document allowing DVN to sign documents for her was not inaccurate in the context of their relationship, and its explanation to her as so characterised was precisely such an explanation in simple terms of a relatively sophisticated concept.

The timing issue

1. The unchallenged evidence from Mr Dunstan's timesheet for 15 July 2011, which was appended to his and Mrs Q's affidavits, was that: 1. on that day, he and Mrs Q spent 30 minutes, from 9.30am until 10am, attending to the execution of the EPA and MQN's will; and 2. of that time, 15 minutes was devoted to chargeable professional work.
2. In their evidence, they said that the remaining time was spent on non-chargeable matters, including social conversation with MQN and DVN. Mr Dunstan gave evidence that he did not customarily charge travelling time for a brief visit to a local client's home, so that his professional time for the signing meeting covered only time spent with MQN.
3. Mrs Gilmour on behalf of the Applicant suggested to Mr Dunstan that 15 minutes was too short a time in which to provide full explanations of both documents. Mr Dunstan replied that: 1. The reason why a new will was being executed was because of an error in the dating of the 1998 will - which referred to a date of 1908, rather than 1998 - which had been caused by an error on his part. It was not his practice to charge clients for remedying his mistakes, and so it should not be assumed that any of the 15 minutes of chargeable time in the timesheet related at all to the will. Indeed, his view was that the chargeable time related exclusively to the EPA. 2. In any case, execution of the will was a very straightforward exercise. The will itself was, in its dispositive provisions, identical to MQN's previous will, dating back to 1998. The only changes were to correct the typographical error in the earlier will, and to include a technical provision which expressly conferred on MQN's trustee and executor certain mechanical powers in relation to the realisation of her estate by way of supplement to those conferred by law. There was, he said, little to explain to her, other than that the new will was the same in all material respects as her 1998 will but for its date. 3. The time available for the EPA was adequate for his purposes, to allow him to explain the purpose and effect of the EPA to her and to satisfy himself (as he says he did) that MQN understood the purpose and effect of the EPA and executed it voluntarily.
4. On balance, the Tribunal accepted Mr Dunstan's account of events. It is not implausible that he did not record professional time for correcting his own error by having MQN re-execute her will in substantially identical form. Equally, the enduring power of attorney is brief in its terms and readily explained, even in simple language and to a person who is not a native speaker of English. Hence, in the Tribunal's view, that the entire process of executing both documents, coupled with social niceties, took 30 minutes does not of itself lead to the conclusion that the explanation and execution the EPA were so inherently flawed that the EPA should be set aside.

The instructions issue

1. There was no dispute that the instructions to Mr Dunstan to prepare the EPA for execution by MQN were communicated to him by DVN. Both DVN's evidence and that of Mr Dunstan were clear on that point. The issue raised by Mrs Gilmour on behalf of the Applicant was whether this fact flawed the granting of the EPA by MQN. In essence, the question is as follows: if MQN did not have sufficient independence of mind to instruct Mr Dunstan herself, how could she have had sufficient independence of mind properly to execute the EPA?
2. The evidence from DVN was as follows: 1. Since his father's death, he had been acting as his mother's agent in her financial and property affairs. Sometimes this agency was formal in nature, as was the case with the authority she conferred on him to act as a signatory on her bank accounts, and sometimes informal in nature, as was the case with his role in relation to the litigation concerning Property A. 2. His informal agency did not, however, allow him to execute certain kinds of documents on her behalf, and his practice was to bring such documents to her for explanation and execution. 3. For some time before the execution of the EPA, MQN had been complaining to him generally about having to sign documents and asking him why he could not do so for her. He explained that in order to do so she would need to grant him a power of attorney, and in July 2011 she had asked him to arrange for such an instrument to be prepared. 4. Following that conversation, he said, he telephoned Mr Dunstan on MQN's behalf to initiate the process.
3. While it is undoubtedly the case that MQN relied heavily on her son's judgment and assistance in the management of her affairs, the fact of his having communicated to Mr Dunstan the instructions to prepare the EPA does not of itself suggest that she lacked sufficient independence of judgment as to vitiate the grant of the EPA. There is nothing implausible in DVN's account of the circumstances which led up to and included his call to Mr Dunstan, and the general content of that call was corroborated by Mr Dunstan in his evidence.

The independent judgment issue

1. The undisputed evidence was that: 1. Before his death, MQN had relied on her husband in relation to business and financial dealings; 2. Following DVN's death, MQN had looked to DVN to undertake a similar function; and 3. DVN had, as outlined above, done so, whether informally (by giving instructions on his mother's behalf in connection with the dispute over Property A) or formally (by acting as a signatory on her bank account).
2. Mr Dunstan gave evidence that one of his staff had telephoned MQN once the EPA was ready for execution, to make an appointment to visit her for its execution. She, however, had declined to do so unless DVN was present at the signing. Mr Dunstan said that this had particularly stuck in his memory, since initially he was a little offended at MQN's reluctance to deal directly with him having regard to their long acquaintance and previous dealings, although unsurprised by MQN's preference. This was because during the litigation concerning Property A not only had MQN clearly been reliant on her son's judgment but had expressed to him on many occasions the confidence which she placed in her son.
3. DVN's evidence was that: 1. he had been present at the signing of the EPA on 15 July 2011; 2. he had explained briefly to his mother, both in Italian and in English, that the EPA was the document which she had requested to allow him to sign documents on her behalf; and 3. he attended the meeting at his mother's request, although he could not recall whether that request had been communicated to him directly by MQN herself or indirectly through Mr Dunstan's office.
4. The evidence of Mr Dunstan and DVN is mutually corroborative as to: 1. DVN being present at the signing of the EPA at MQN's specific request; and 2. the original expectation of both Mr Dunstan and DVN, that DVN would not necessarily be present for the signing.
5. The Applicant invites the Tribunal to infer from the undisputed fact of DVN's presence at the signing that he influenced MQN to execute the EPA in its current terms. This inference cannot, in the Tribunal's view, be safely or reasonably drawn.
6. Both in MBL's statement dated 8 September 2017 and in Mrs Gilmour's submissions some emphasis was placed on the fact of Mr Dunstan having several years previously, on 23 December 2009: 1. prepared an elaborate direction from MQN relating to the payment to DVN of certain moneys received as a compensation payment from insurers in connection with the litigation over Property A; and 2. included in that direction confirmation by MQN that MBL and NZG had explained the direction to her in Italian, and provision for MQN's signature to be witnessed by NZG and MBL. The conclusion which was urged on the Tribunal was that these arrangements demonstrated that Mr Dunstan already had in December 2009, some 18 months before the EPA was executed, concerns as to MQN's capacity to understand business or financial transactions, and that his evidence as to MQN's apparent understanding of the EPA should be discounted accordingly.
7. Mr Dunstan's evidence was that the direction was one for him to pay the moneys to DVN towards reimbursement of amounts incurred by DVN for MQN's account in connection with the litigation. A written direction from MQN, as client, was required to allow him to deal with the moneys received into his trust account, and that in view of: 1. The large amount involved; 2. The nature of the direction, under which the successful plaintiff directed her solicitor to pay amounts recovered by her to a third party; and 3. The somewhat unusual arrangements embodied in the direction, the purpose of which was to allow the moneys to be debited to Mr Dunstan's trust account and to start earning interest for DVN before Mr Dunstan's office reopened after the Christmas/New Year break, he considered it not only necessary for the arrangements to be set out in some detail but also for there to be evidence that the arrangements had been fully explained to MQN.
8. Mr Dunstan's explanation was a plausible and reasonable one, and nothing in the circumstances of 23 December 2009 is in the Tribunal's view sufficient to cast doubts on his evidence concerning the execution of the EPA. The instructions of 23 December 2009 record quite a complex - although not inherently unreasonable - arrangement involving the payment of a specific and large amount to which MQN was entitled as the successful plaintiff. They can be contrasted with the EPA which records a relatively straightforward (although in principle legally significant) conferral of authority which formalised the general practice that since 1998 had operated informally as between MQN and DVN concerning the management of her affairs. The Tribunal did not, therefore, draw from the events of 23 December 2009 any adverse inference concerning (or in relation to Mr Dunstan's evidence concerning) those of 15 July 2011.

Conclusion as to the making of the EPA

1. There is, in the Tribunal's view, little doubt that the signing of the EPA could with hindsight have been conducted differently, in a way which could have eliminated some at least of the concerns raised by the Applicant. Clearly, for example, it would have been possible to have an Italian interpreter or one or other of MQN's daughters present. Whether in the circumstances of MQN's longstanding reliance on her son she would have been willing to execute the document in his absence is, however, a different matter.
2. In any event, the issue is not whether the signing could have been conducted differently, but rather whether there is sufficient evidence for the Tribunal to conclude that the circumstances surrounding the execution of the EPA were such that it cannot be considered a true expression of MQN's wishes. On balance, the Tribunal does not consider that it can properly reach that conclusion.

The operation of the EPA

1. The second area in which the Applicant asks for the EPA to be reviewed concerns its operation. Both NZG and MBL in their respective statements of 8 September 2017 outline a series of concerns with the way in which DVN has been operating under the EPA, such as to justify the Tribunal in either: 1. suspending the operation of the EPA by appointing a person or persons other than DVN (being NZG and MBL, or the NSW Trustee and Guardian) as MQN's financial manager, or 2. varying the EPA by appointing NZG and MBL as MQN's attorneys in place of DVN.
2. That DVN has been managing MQN's financial and business affairs since 1998 is not in dispute. Moreover, the evidence provided by DVN, which was uncontested, was that he has done so: 1. primarily under informal agency arrangements - most notably, in connection with the litigation concerning Property A - or as a signatory on her bank account under an Authority for Operations signed by her which is dated 6 June in either (the date is handwritten, and the relevant year is not entirely clear in the copy annexed to DVN's affidavit dated 8 October 2017) 2006 or 2008; and 2. only to a limited degree under the EPA; indeed, in paragraph 119 of his affidavit DVN states that he has only used the EPA to execute five specific documents which he lists in that paragraph, as well as MQN's annual income tax returns; the five specific documents are all unremarkable documents relating to equally unremarkable transactions of a kind typically encountered in the ordinary course of owning and letting residential or retail property.
3. This leads the Tribunal to conclude that, so far as the operation of the EPA is concerned, there is no reason for it to intervene. Accordingly, the Tribunal dismisses the Application to Review the EPA.
4. That, however, is not the end of matters, since the third application, for a financial management order concerning MQN, requires the Tribunal to consider more widely DVN's management of his mother's affairs, whether as attorney under the EPA, bank signatory or informal agent. These reasons now turn to the financial management application.

Does NZG have standing to bring this application?

1. A person has standing to bring an application if he/she is: 1. the person who is the subject of the application 2. the NSW Trustee and Guardian or 3. any other person who, in the opinion of the Tribunal, has a genuine concern for the welfare of the person.
2. The Tribunal found that NZG has standing to make the application for a financial management order because, as MQN's daughter, she can reasonably be considered to have the necessary concern.

What did the Tribunal have to decide?

1. The questions to be considered by the Tribunal are:

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

Is MQN incapable of managing her affairs?

1. In Re D [2012] NSWSC 1006, White J assessed the history of case law in relation to financial management and noted that initially the issue of capability was approached by referring to hypothetical or abstract notions of the ordinary affairs of man. However, the Court now assesses the person's own capacity to do what they are proposing to do [58]. White J used a "rational appreciation" of assets test to determine a person's capability to manage his or her affairs. He adopts the reasoning of Barrett J in P v R [2003] NSWSC 819 who said that the task of the Court in these circumstances: …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…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 [26].
2. In PB v BB [2013] NSWSC 1223, Justice Lindsay confirmed that the question focuses attention on the special circumstances of the person. His Honour stated, at [7]: Of central significance is the functionality of management capacity of the person said to be incapable of managing his or her affairs, not: (a) his or her status as a person who may, or may not, lack "mental capacity" or be "mentally ill"; or (b) particular reasons for an incapacity for self-management.
3. The test for determining a person's capability to manage his or her affairs has been described as follows (P v NSW Trustee and Guardian [2015] NSWSC 579, [307]-[308]): Is a person reasonably able to manage his or her own affairs in a reasonably competent fashion, without the intervention of a [financial manager] charged with a duty to protect his or her welfare and interests? … [A] focus for attention is whether the person is able to deal with (making and implementing decisions about) his or her own affairs (person and property, capital and income) in a reasonable, rational and orderly way, with due regard to his or her present and prospective wants and needs, and those of family and friends, without undue risk of neglect, abuse or exploitation.
4. In considering whether the person is "able" in this sense, consideration may be given to:

• past and present experience as a predictor of the future course of events;
• support systems available to the person; and
• the extent to which the person, placed as he or she is, can be relied upon to make sound judgments about his or her welfare and interests: see Lindsay J in CJ v AKJ [2015] NSWSC 498 at [38], and P v NSW Trustee and Guardian at [309].

1. The relevant time for considering whether a person is incapable of managing his or her affairs is not merely the day of the hearing but the reasonably foreseeable future (McD v McD (1983) 3 NSWLR 81 at 86). See Lindsay J in Re W and L (Parameters of Protected Estate Management Orders) [2014] NSWSC 1106 at [20]: Each case must, of course, be considered on its own facts, including not only actual facts presently known but also, so far as they can be known, prospective developments.
2. There is in the present case: 1. no dispute amongst NZG, MBL and DVN that MQN lacks the capacity to manage her affairs; and 2. considerable evidence in the form of: 1. the letter dated 31 July 2017 from Dr Z, of a medical centre, MQN's usual doctor, confirming the extent and disabling effect of her progressive dementia; and 2. the oral evidence provided by Ms Y, Ms X and Ms W, all of the aged care facility in north Sydney, concerning MQN's limited cognition, to support that conclusion.
3. The Tribunal was satisfied therefore that MQN lacks the capacity to manage her affairs and is a person for whom it could make a financial management order if the other conditions for such an order are satisfied.

Is there a need for a financial management order?

1. A simple mechanistic approach would be to decide that there is no need for a financial management order since arrangements are in place for the management of MQN's affairs in the form of the EPA and the appointment of DVN as a signatory on her bank accounts.
2. In considering this application, however, the Tribunal is required to look more widely, and in particular under s 4 of the Guardianship Act to consider several principles. These include relevantly: 1. under paragraph 4(d), the views of MQN herself; 2. under paragraph 4(e), the importance of preserving MQN's family relationships, and her cultural and linguistic environment; 3. under paragraph 4(g), her protection from abuse, neglect and exploitation; and 4. under paragraph 4(a), which is expressed to be the paramount consideration, her welfare and interests.
3. The consequence is that the Tribunal must look beyond the simple fact of those management mechanisms to make an assessment whether, having regard to the relevant principles in s 4 of the Guardianship Act, a financial manager is nonetheless needed.
4. NZG and MBL say that the history and dynamic of DVN's involvement with his mother's affairs means that this is the case. They raised the following matters in support of this proposition: 1. DVN's business and financial affairs were inextricably linked with those of FXN (his late father), and following his death those of MQN, to the point that it is impossible for DVN to bring to bear on MQN's affairs the degree of objectivity and independence which is required to manage them in her interests. 2. The history of property and business dealings between, on the one hand, FXN and MQN and, on the other, DVN, is such that DVN has obtained significant financial benefit from at least one transaction, involving the development and sale of a retail and apartment development in northern Sydney, which ought properly have been more equitably shared with his parents having regard to their investment in the development. A financial manager would be able to investigate the circumstances of this transaction, to the possible financial benefit of MQN. 3. The circumstances surrounding the application of the proceeds of the litigation concerning Property A are a cause of concern, since substantial sums of money were applied by DVN for his own purposes. These include relevantly an apparent shortfall of approximately $780,000 between, on the one hand, the aggregate receipts from the litigation concerning Property A and, on the other, the costs of the litigation and the costs of repairing Property A. Similarly, they say, the appointment of a financial manager would allow these transactions to be investigated, to the possible financial benefit of MQN. 4. Over the period 1998 to 2015 there was a series of payments from MQN to DVN, totalling on their calculation approximately $500,000. Again, they say, a financial manager could investigate these transactions. 5. MQN on 28 November 2005 entered into guarantees in favour of Bank Z of DVN and EJN's borrowings from the bank. These guarantees are secured by a mortgage over Property A which MQN executed on 30 December 2005. It is inappropriate that MQN's principal asset be used to secure DVN and EJN's liabilities, and a financial manager could seek the release of these guarantees and the associated security. The existence of the guarantees and mortgage places DVN in a position of conflict of interest in pursuing his mother's best interests. 6. DVN claims an equitable interest in Property A, which is registered in the name of MQN. This claim again places him in a position of conflict of interest in promoting MQN's interests. 7. Rental payments by MBL for the apartment occupied by her in Property A were paid by her in cash to DVN. She says that these payments were not declared as income in MQN's tax returns in the 2014/2015 tax year, and surmises that these payments were diverted by DVN for his benefit, not that of MQN. 8. The income generated by Property A is not necessarily sufficient to cover MQN's accommodation charges at the aged care facility. While they recognise that DVN pays any shortfall it is, they say, inappropriate that MQN is accommodated at the "grace and favour", to use Mrs Gilmour's expression, of DVN. The appointment of a financial manager would assist in placing MQN's affairs on an independent footing, so that she is not dependent in part or in whole on her son's financial support. 9. The management of Property A by or on behalf of DVN has been unsatisfactory, for several reasons: 1. the maintenance of the property has been inadequate. 2. a long-standing tenant of retail space on the complex who was a friend of MQN, Ms V, was ejected. 3. the complex is professionally managed by a firm of real estate agents, who charge for their services. A similar management function could be undertaken by family members at no charge.
5. DVN says that: 1. For over 40 years the property and business dealings of FXN, MQN and himself have been conducted in an informally integrated way. They are and always have been interlinked, but that alone neither renders him unable to act in his mother's interests nor necessitates the appointment of a financial manager for her. The purpose of developing Property A was to provide his parents with both a home and a source of income in their retirement. This objective was achieved and although MQN no longer lives there she continues to benefit from the income earned by the complex in accordance with her and her late husband's plans. 2. The development and sale of the northern Sydney property were conducted on the basis agreed between DVN and FXN, which reflected the risks and contributions respectively undertaken or made by them in connection with the development. 3. The proceeds of the litigation were properly applied to meet the costs of repairing Property A, the very substantial legal and other costs incurred by DVN and EJN in conducting the litigation, and the substantial financial costs incurred by DVN and EJN in funding the litigation. 4. The transfers from MQN's account to DVN's account (or to the account of a business associated with him) were in conformity with arrangements agreed between DVN and FXN before FXN's death in pursuance of the informal family business plan. These were that FXN would contribute funding to a [redacted] construction and marketing business to be operated by DVN. When, on FXN's death, MQN inherited all his assets, this investment arrangement continued with MQN's concurrence through her contribution of the funding originally agreed to be provided by FXN. The transfers were made by DVN at intervals, but always so as to ensure that an adequate cash buffer for MQN's needs remained at her disposal in her account. 5. Property A was originally encumbered in order partially to fund its construction, and this debt has been both paid down to a substantial degree and refinanced on several occasions. The most recent refinancing was with the Bank Z, who took the guarantees and mortgage in question. There is, DVN says, no dispute that the guarantees and mortgage do secure bank debt owing by him and EJN, or that they applied this debt towards the acquisition of their property portfolio (which also secures the debt). He says that in any event the bank debt is, notionally at least, attributable to some degree to the development costs of Property A. He says that his and EJN's level of debt and interest costs are conservative, and that in practical terms his mother and Property A have no exposure to financial risk because of the existence of the guarantees and mortgage. 6. He considers that he is entitled to an equitable interest in Property A. This is because of his physical and financial contributions to its development. He does not, however, have any intention of asserting that claim during his mother's lifetime. In any event, he has no interest in doing so, since under his mother's will he stands to inherit the entire property, subject only to making a cash payment to his sisters determined by reference the value of the apartment previously occupied by his parents. 7. He agrees that he received on his mother's behalf cash payments from MBL for the apartment occupied by her in Property A, although he preferred to characterise these as board rather than rent. He passed these payments on to his mother, who used them to meet her living expenses and incidental expenditure, such as gifts to friends and relatives. To the extent there was any surplus, his mother usually, with the generosity for which she was known, gave it to him in cash as a gift. 8. To the extent that there is a shortfall between, on the one hand, his mother's accommodation charges at the aged care facility and her additional expenses such as physiotherapy, and, on the other, the net revenues generated by Property A, he has met that shortfall from his own resources and intends to continue to do so. One of the reasons why there is a shortfall from time to time is that the revenues from the complex are lower than they would be if an entirely commercial approach to the management of the building were adopted, since two of the residential apartments in the complex are occupied by NZG and MBL without paying rent. 9. The introduction of professional management to Property A has been successful. The quality of tenants has improved, and the management costs are not excessive having regard to market levels. The complex is properly maintained.
6. The parties provided the Tribunal with a substantial quantity of documentary evidence, and themselves both provided oral evidence and arranged for several third parties to provide evidence. Their respective legal advisers examined at length the witnesses. Out of all this, several relevant conclusions could be drawn: 1. The business and financial affairs of the members of the family of MQN family have been closely intertwined for many years, and these intertwined arrangements were both made and conducted on a very informal basis. The evidence provided by NZG, MBL and DVN all make this clear. In her statement of 8 September 2017, NZG says as follows: 10. Prior to Dad's death, family members had lent money to each other when it was needed with no documenting these arrangements. 11. That was the "Italian" way and our family had come from nothing to my parents being retired on their investments at a relatively young age. 12. I lent [DVN] $150,000 when he was building a complex of apartments and shops at [northern Sydney] and needed money to pay his partner out. He lent money to my daughter [Ms T] and her partner [Mr S]. In his affidavit of 9 October 2017 DVN recounts a similar pattern. In paragraph 26 he sets out a lengthy history of property purchases and developments, often involving the physical performance of work by him and his father, the sale of those properties and the reinvestment of the profits in further ventures. He says that until 1983, NZG and MBL were active participants in these ventures, although from then onwards they preferred to cease investing in the family developments. In paragraph 37 he sets out his understanding of the arrangements for Property A: It had always been my understanding, based on statements repeated to me by Dad and Mum over the years, that everything we built up together over the years belonged to the three of us and would eventually go to me. That is why the purchase of [Property A] and the construction of the building was funded by our combined resources and joint effort. In paragraphs 53 to 69 he sets out in some detail the arrangements which he believed applied, at least as between family members, to the development of the northern Sydney property. The informality with which he and his father made quite complex arrangements is apparent from the final sentence of paragraph 59: Although the final deed [which is the deed referred to below involving [Mr R]] provided that Dad was to be responsible for the construction and fitout costs of unit 3, I paid all the construction and fitout costs above Dad's contribution of $150,000 plus about $20,000 in costs (which I arranged for him to borrow). What is remarkable here is that, even in the context of a formal deed whose function was, in part at least, to resolve difficulties arising from the informality with which the original venture had been established, FXN and DVN continued to conduct their own business relationship on an informal basis. 1. There is no doubt that DVN's financial success is in part attributable to the capital support provided by his parents. Without that support, he would have had less opportunity to deploy and profit from his skills as an astute real estate investor. Sometimes their support took the form of direct investment, as he details in paragraph 81 of his affidavit concerning the use of the net proceeds of sale of his parents' unit in the northern Sydney development as start-up capital for his [redacted] manufacturing business. Sometimes it was in less direct form, such as the guarantees and mortgage granted by MQN. When asked by the Tribunal what the consequences would be of procuring the release of FXN's guarantees to Bank Z, DVN said that in order to do so he and his wife would have to reduce their property portfolio by selling one or two properties. This answer clearly indicates that the credit support which the bank has from MQN for his and EJN's borrowings remains a material factor in determining their borrowing capacity, and ultimately the size of their property portfolio. 2. Some discrete aspects of the business and property history of FXN, DVN and MQN are set out in documents. These include loan and security transactions with banks and the deed dated 23 December 1995 between DVN and EJN, FXN and DVN's co-venturer in that development, Mr R and interests associated with him, under which FXN was introduced as a co-venturer into the northern Sydney development, and Mr R's role was reduced. Other aspects, including DVN and EJN's role in funding Property A litigation appear only to be partially documented, for example by the written direction of 23 December 2009. 3. Property A was developed in order both to serve as a home for FXN and MQN and, through renting to tenants the apartments not occupied by them and the ground floor retail space, to provide them with income in their retirement. This was common ground between NZG, MBL and DVN. 4. MQN looked to DVN to manage her financial affairs following her late husband's death. This is recognised clearly in paragraph 9 of NZG's statement of 8 September 2017 and follows from MQN's appointment of DVN as a signatory on her bank account and DVN's central role in the conduct on her behalf of the litigation associated with Property A. Mr Dunstan's evidence was also clear on the point. 5. Both MQN's will executed on 28 August 1998 (although dated 28 August 1908) and her replacement will dated 15 July 2011, copies of each of which are appended to Mr Dunstan's affidavit dated 6 October 2017, provide for DVN to inherit MQN's estate on her death, subject to the payment to his sisters of one third each of the notional value of Unit X in Property A. 6. MQN is settled and generally well cared for at the aged care facility and that there is little practical alternative to her continuing to reside at the aged care facility, even if intensive home care might in principle provide more personalised care. This is established by oral evidence from each of NZG, MBL and DVN. 7. Apart from privately arranged physiotherapy, there is little if anything by way of additional care or services which could usefully supplement the care provided to MQN by the facility. MQN receives frequent visits from her children, and that all three of her children lived in north Sydney clearly facilitates MQN receiving this intense family contact and support. That NZG and MBL live in Property A, which lies almost directly behind the aged care facility in the next street, makes it particularly easy for them to provide this contact and support. This was established by the oral evidence from each of NZG, MBL and DVN, and corroborated by the oral evidence from Ms Y, Ms X and Ms W. 8. MQN's accommodation charges at the aged care facility are paid regularly by means of a direct debit. They are paid up to date, and subject to one qualification there have been no issues with their full and timely payment. The one issue arose in early 2016, shortly after MQN's entry into the facility, when a direct debit was rejected. This, however, was promptly remedied. This was established by oral evidence from Mr P, a financial officer with the aged care facility. Mr P also told the Tribunal that MQN had now reached a legally prescribed lifetime fee cap, so that her aggregate payments to the aged care facility can be expected to stabilise at a lower level than that at which they have been to date. 9. Since the management of Property A was assumed by a real estate company in October 2015, all rental income has been received by those agents, and all outgoings related to the property have been paid by them from rental receipts. This is apparent from copies supplied to the Tribunal and the parties of Owner Income and Expenditure Statements for Property A prepared by the real estate company for each of the financial year ending 30 June 2016, the financial year ending 30 June 2017 and the period from 1 July 2017 to 31 January 2018. These statements break down income and expenditure for Property A on a monthly basis, allowing the relevant amounts to be traced into MQN's bank statements. The net rental income disclosed by the various Owner Income and Expenditure Statements has been transferred by the real estate company into MQN's bank account * [Footnote removed for publication.] with Bank Y on a monthly basis, and since June 2016 MQN's accommodation charges have been paid by monthly direct debit to the aged care facility from that account. Before then, payments of accommodation charges were also made by direct debit from MQN's account, but on a more episodic basis. It is also clear that on 3 March 2017 DVN made a deposit of $10,000 into the account. There is a sequence of frequent (but relatively regular) minor debits to the account; DVN told the Tribunal that these are for MQN's medication, and for the services of her doctor, Dr Z. Larger debits were, DVN said, to meet MQN's income tax liabilities ($8643.05 on 6 June 2016, and $6022.00 on 21 March 2017) and to pay for her dentures ($3100 on 29 July 2016). Other minor debits include a payment to Ms V for hair dressing and small amounts of expenditure which, according to DVN, were made by NZG or MBL for their mother and paid from MQN's account. All this is clear from bank statements supplied to the Tribunal and the parties concerning MQN's account * [Footnote removed for publication.] with Bank Y in respect of the period 18 September 2015 to 17 January 2018. 10. NZG occupies a unit at Property A (which was FXN and MQN's home) without paying rent. She said that she would be unable to afford a full market rent for the unit, although she said in evidence that she would be willing in principle to pay some rent or to move into a smaller and less expensive unit in the building. 11. MBL and her family occupy a unit in Property A as well. She paid an amount for her occupancy until mid-2015. She stopped doing so, she said in evidence, because of concern that the amounts paid by her were not being used for her mother's benefit. MBL acknowledges that she owes the amounts unpaid and said in evidence that she is willing to resume payment once she is satisfied that the amounts in question will be used for her mother's benefit.
7. Having regard to the relevant considerations under s 4 of the Guardianship Act, the Tribunal draws the following conclusions: 1. Paragraph 4(d) requires the Tribunal to consider the views of MQN herself. Although for the reasons summarised above she did not participate in the hearing, it is in the Tribunal's view clear from the evidence that following her husband's death MQN looked to DVN to assist her in the conduct of her financial and business affairs. What follows is that, if MQN's views are to be inferred, they would likely favour the dismissal of the application and the continuation of DVN's role as her attorney and bank signatory. This is an inference which the Tribunal thinks it can reasonably make, in view of her conduct following FXN's death, by appointing DVN as a bank signatory, by leaving DVN to conduct the litigation concerning Property A, and by refusing to execute the EPA without his presence. 2. Paragraph 4(e) requires the Tribunal to have regard to the importance of preserving MQN's family relationships, and her cultural and linguistic environment. Since her life at the aged care facility is conducted in English and it was common ground between her children that there is little practical utility to be had by providing her with an occasional Italian speaking companion, linguistic considerations do not enter into matters, except to the extent that she may speak Italian with her children and sister, and thus overlap with the preservation of family ties. While it was clear to the Tribunal that relationships between DVN, on the one hand, and his sisters, on the other, are strained and perhaps irretrievably damaged, each of NZG, MBL and DVN have a close, genuine and continuing bond with their mother and each of them recognise the others' similar bonds. This was clear from the evidence they each gave as to their respective daily regimes for visiting MQN, who is in the relatively privileged position of having all three of her children living close at hand and visiting her on a daily (or near daily) basis. For a financial manager to be appointed who viewed it as part of his or her role to maximise MQN's rental income at the price of forcing one or both of NZG and MBL to move out of Property A might be financially advantageous for MQN but would clearly put at risk the close and frequent contact between her and her daughters. A less negative outcome might be the appointment of a manager who prioritised the benefits to MQN of family contact over lower income. The appointment of a financial manager is not, therefore, inherently inimical to the considerations in paragraph 4(e), although much would depend on the views and approach of the particular manager. 3. Paragraph 4(g) directs the Tribunal to consider MQN's protection from abuse, neglect and exploitation. At the heart of NZG's application is the proposition that MQN has been financially exploited by DVN, and that this is demonstrated by a succession of transactions or dealings - principally, the sale of the northern Sydney property and the various transfers of money from MQN's account to (or to entities associated with) DVN. DVN's response is that these transactions or dealings should not be viewed in isolation but must be considered as elements of a long-term family business plan originally embarked on by DVN and his father, and continued by DVN with the passive participation of MQN after FXN's death, to build the wealth and financial security of FXN and MQN and himself. There is nothing inherently implausible in this proposition, nor in the fact that there is no written master plan or even a consistent practice of documenting the intentions of family members in relation to individual ventures. That DVN often conducted his business affairs informally, even with people who were not family members, is apparent from the deed with Mr R referred to above: Recital C to this deed recites that DVN and Mr R "… entered into a verbal [sic] joint venture agreement..." for the northern Sydney development, The only person who can provide any first-hand insight into the context of these transactions is DVN, and his evidence as to the informal nature of the family business arrangements is not inconsistent with NZG's general observations to a similar effect in her statement. The individual transactions of which NZG and MBL complain necessarily take their quality from their respective contexts. NZG and MBL say that the fact of there being transfers from MQN to DVN (or interests associated with him) at a time at which DVN was acting formally or informally on behalf of MQN necessarily raises questions; DVN provides a reasonable and plausible explanation in response, but this response is not corroborated. In the Tribunal's view, however, its concern is not with the investigation or remedy of perceived historical wrongs as such; rather it is with ensuring that appropriate arrangements are in place for the continuing management in her interests of MQN's affairs. The need for the investigation and remedy of historical wrongs which continue adversely to affect the present welfare and interests of the person concerning whom the order is sought are undoubtedly relevant factors for the Tribunal to consider in appropriate cases. In the present case, however, not only is the evidence that MQN's needs are being met but it is clear from the documentary evidence as to dealings with MQN's money and assets over the past two and a half years that since she became a resident of the aged care facility her income and assets have been managed by DVN with efficiency and propriety, and without any suggestion of financial abuse or exploitation. Moreover, the evidence is that her care expenses are being met. That being the case, there is no clear basis for the Tribunal to conclude that a financial management order is required in order to protect MQN from abuse, neglect or exploitation. 4. Paragraph 4(a) tells the Tribunal, as its paramount consideration, to look to MQN's welfare and interests in considering this application. For the reasons outlined in the next paragraph, and subject to the qualifications outlined there, the Tribunal considers that MQN's welfare and interests are best served by not appointing a financial manager.
8. Several considerations are relevant to the Tribunal's conclusion on this issue: 1. MQN is an elderly lady, of limited mobility and cognition. It is common ground amongst all interested parties that her care is practically best assured by her remaining a resident at the aged care facility, where her children can (and do) visit her regularly and frequently. Her interests and welfare are clearly served by a continuation of this situation. Since it is clear from the evidence that her income from Property A has been applied for the past two and a half years towards her accommodation charges and has been generally sufficient for that purpose, with some supplement from DVN, it would appear that the current arrangements are serving her welfare and interests adequately. That being the case, the Tribunal asks, what practical benefit to MQN would result from the appointment of a financial manager? 2. The Applicant argues that the existence of the guarantees and mortgage in favour of Bank Z places MQN's financial position in peril, and that a financial manager is needed to negotiate their release. Undoubtedly Property A is one of the 17 properties (of which 16 are owned by DVN and EJN) which, according to DVN's statement of assets and liabilities, are available to meet DVN and EJN's bank debt. Whether MQN's welfare and interests necessitate the immediate renegotiation of those arrangements, and the appointment of a financial manager to do so, is another question. The evidence from DVN was that he and EJN meet all interest and other payments on their loans promptly and without difficulty from the income generated by their investment properties. The financial information provided by him to the Tribunal as to his and EJN's net worth indicates that they have a personal balance sheet which would allow all their bank debt to be met comfortably from the proceeds of sale of their property and investment portfolio without recourse to Property A, and that this portfolio consists of assets which could be realised within a reasonable timeframe in order to satisfy the bank debt. He answered convincingly questions as to the significance for his financial position of at least one investment property being temporarily untenanted. Moreover, there was no evidence that Bank Z has made any suggestion that it proposes to, or is even contemplating, making a demand under MQN's guarantees or enforcing its mortgage over Property A. Were the bank to seek repayment, then it might well be appropriate to appoint an independent financial manager for MQN, to agitate with the bank certain questions as to the validity and enforceability of its guarantees and security from her, having regard to her age, personal situation and reliance on DVN's commercial advice when she gave the guarantees and mortgage. However, in MQN's present circumstances, the mere existence of the guarantees and the mortgage does not of itself in the Tribunal's view presently justify the appointment of a financial manager from the standpoint of her interests and welfare. 3. The Applicant says that MQN needs a financial manager because of DVN's assertion that he is entitled to an equitable interest in Property A. Were his assertion to mature into a formal claim for the recognition of such an interest, then it might well be appropriate for a financial manager to be appointed to represent MQN's interests. No such claim has been made, however, and DVN was adamant in his evidence not only that he had no intention of doing so but also that, since he stands to inherit Property A on MQN's death, for him to do so would be entirely pointless. Hence, that DVN is aware that he may have such an entitlement is not of itself presently sufficient in the Tribunal's view to justify the appointment of a financial manager to protect MQN's interests. 4. It is well-established that the business, property and financial dealings of MQN's family over the past 40 years have been complex and that the interests of three family members - FXN and MQN and DVN - in and derived from those dealings have been - and remain - intertwined. The Applicant says that these intertwined dealings have been conducted by DVN since FXN's death in a way which unfairly disadvantages MQN. The Applicant invited the Tribunal to infer this from the undisputed fact of a succession of individual transactions, each of which involved either a transfer of value in some way from MQN to, or to interests associated with, or at the instigation of, DVN. DVN, as these reasons note above, explained these transactions by reference to their wider context within the business plan of the family of MQN. Even if, hypothetically, the Tribunal were to conclude that one or more of these transactions could properly be considered as unfair to MQN, the issue for the Tribunal would then be to decide whether MQN's interests and welfare would in fact be promoted by the appointment of a financial manager to investigate and possibly seek the reversal of such a transaction. The answer, in the Tribunal's opinion, is not as self-evident as the Applicant suggests. Certainly, a successful challenge to such a transaction might well increase MQN's personal wealth while at the same time remedying a perceived historical unfairness to her. However, the evidence is clear that her current living arrangements address satisfactorily her needs and, with one supplement from DVN, her income from Property A has for the past two and a half years been both adequate to fund her accommodation and other needs and applied to that purpose. For a financial manager successfully to challenge a particular transaction would not necessarily lead to any practical improvement in MQN's life, since an increase in her resources is unlikely to have any effect either on her needs or their capacity to be satisfied. Moreover, the process of challenging would in fact introduce an undesirable instability, uncertainty and institutionalised discord into her life as it draws to an end. In the Tribunal's view, since MQN's care is appropriate and her needs are being met under the present arrangements, her interests and welfare are best served by stability and continuity. This conclusion supports a continuation of the present regime, at least for so long as it continues to address her needs as effectively as it has for the past two and a half years. 5. The Applicant says that a financial manager would better manage Property A for MQN's benefit. The evidence, however, suggests that under DVN's management since late-2015 the property has been efficiently managed, with transparent recording and reporting of income and outgoings and an improvement in the quality of the tenants of the retail space. Moreover, subject to two qualifications, it has been managed in a commercial way. The first (and more minor) qualification is that certain rentable garage space in the complex has been used, not to generate income, but rather for the continuing storage of DVN's concreting equipment and a pottery kiln which MQN has not used for some years. This suggests either inertia (in not cleaning out the areas) or a sentimental reluctance (from which even the most rational of adult children are not necessarily immune) to part with objects having an association with their parents. Whatever the explanation the amounts involved are modest when compared to those involved in the second qualification. This relates to NZG and MBL's continuing occupation of apartments in the complex without paying rent. It is undoubtedly in MQN's interests to have her daughters close at hand and able to visit her frequently, and this assessment may well underlie what appears to be a tacit acceptance on her behalf of the current situation, the effect of which is to sterilise to an appreciable degree - perhaps between 30 and 40 per cent - the income-producing potential of Property A. 6. The Applicant says that it is not in MQN's interests to be dependent on the "grace and favour" of DVN. To the extent this concern is inspired by the existence of the guarantees and mortgage in favour of Bank Z, then our observations above address it. To the extent it is referrable to DVN's occasional subsidies for MQN, then it raises the issue outlined above, of balancing the competing commercial and personal considerations inherent in managing the occupancy of Property A. In summary, MQN's income is generally adequate to meet her current needs. Since her entry into the aged care facility, her income has been properly accounted for and used to fund her accommodation and personal needs. There is no evidence of any impropriety during that period in the management of MQN's assets or income. She is well cared for, her accommodation is stable, and she enjoys frequent contact with her children. In the Tribunal's view, her welfare and interests are not served by a change in the current arrangements, which address adequately her present needs. The appointment of a financial manager risks introducing instability and discord into her life. The Tribunal's view is, in brief, that MQN's welfare and interests are presently best served by leaving well enough alone.
9. The Tribunal's view is based on the current circumstances. If any of these were to change in way which was adverse to: 1. the stability of MQN's accommodation at the aged care facility; 2. the integrity of MQN's title to Property A; 3. the continuing availability to her of the entire income generated by Property A; 4. the generation of an economic return from Property A adequate to meet her needs; or 5. the close and frequent contact she enjoys with all of her children; then the outcome of a further application before a different panel might well be different. That, however, would be a matter for the Tribunal at the time.
10. For these reasons, the Tribunal was not satisfied that there is a present need to appoint someone to manage MQN's affairs. The application for financial management should be dismissed.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 06 November 2019