PZD [2019] NSWCATGD 31

NCAT Guardianship|2019-12-04

What the Tribunal Decided

We dismissed the application for a guardianship order for PZD.
We made a financial management order in relation to PZD and appointed QLM and BKN jointly and severally as her financial managers subject to the authorities and directions of the NSW Trustee and Guardian.

Background

PZD is aged 86 years. She lives in her own house at regional NSW. PZD moved there from Sydney following retiring, having worked for many years with a banking institution.
Whilst living in regional NSW in 2006, PZD was diagnosed with schizophrenia and remains under the care of a medical centre, taking medication for this condition.
PZD has assistance with home cleaning each fortnight through a service provider and has assistance with transport from a carer from another service, Service Provider AB.
The Tribunal has received an application from PZD's daughter, QLM for a guardianship and financial management order for PZD. QLM lives in the Upper North Shore of Sydney and is supported in her applications by her brother, BKN who lives in Lower North Shore of Sydney.
The applications were received by the Tribunal following an incident in August 2019 in which PZD wrote a cheque for $1.2 million dollars to Service Provider AB. Whilst Service Provider AB contacted QLM following receipt of the cheque and the cheque was cancelled, QLM and BKN are concerned about risk to her finances and to her welfare more generally. They propose that they be appointed as PZD's guardians and financial managers.

The hearing

At the end of these Reasons for Decision are lists of the parties to the application and the witnesses who attended the hearing. [Appendix removed for publication.]

What did the Tribunal have to decide?

The questions which had to be decided by the Tribunal were:

Is PZD someone for whom the Tribunal could make an order because she has a disability which prevents her from being able to make important life decisions?
Should the Tribunal make a guardianship order and if so, what order should be made?
Who should be the guardian?
How long should the order last?

Is PZD someone for whom the Tribunal could make an order because she has a disability which prevents her from being able to make important life decisions?

Section 14 of the Guardianship Act 1987 (NSW) ("the Act') provides that the Tribunal may make a guardianship order for a person if it is satisfied that he or she is "a person in need of a guardian". A person in need of a guardian is "a person who because of a disability is totally or partially incapable of managing his or her person": the Act, s 3(1). A person with a disability is a person who is: 1. intellectually, physically, psychologically or sensorily disabled; 2. of advanced age; 3. a mentally ill person within the meaning of the Mental Health Act 2007 (NSW); or 4. otherwise disabled; and by virtue of that fact is restricted in one or more major life activities to such an extent that he or she requires supervision or social habilitation: the Act, s 3(2).
Before us is a report from Dr Z, General Practitioner from the Medical Centre. Dr Z confirms PZD's diagnosis of schizophrenia and that she currently takes medication for this condition by way of three weekly injections and orally each night. Dr Z describes PZD as a pleasant lady in good physical health for her age and whilst not a danger to herself states she remains psychotic and undergoing psychiatric review.
Also, before us is a report from Dr Y, who is also a General Practitioner from the Medical Centre and who has seen PZD more regularly. Dr Y's report is dated 28 November 2019. Dr Y states that PZD's schizophrenia is moderate and is a fluctuating condition. She notes that she was previously on a Community Treatment Order, however, since 2011 has been voluntarily attending as a patient. It is Dr Y's opinion that PZD's mental illness affects her capacity to make informed decisions. Whilst at present Dr Y considers that PZD is happy and safe in her own home, she states her lack of insight may impair her ability to discern the best sort of accommodation into the future. Similarly, whilst currently Dr Y considers that PZD is independent in her personal care and meals, this may need to be reviewed as she will likely need increasing help.
In relation to decisions about health and medical care, Dr Y considers that her schizophrenia and at times her paranoid ideation may prevent her from recognising a deterioration in her health, however states that her general health and mental health are assessed regularly at their practice.
Further, Dr Y considers that PZD schizophrenia could allow her to be vulnerable to either internal or external suggestions that may lead her to make ill-advised or incorrect financial decisions.
Whilst the focus of Dr Y's report is PZD's mental illness, she notes that the most recent assessment with the Mini Mental State Examination (MMSE) with a score on 23/30 on 28 November 2019 indicates mild cognitive impairment being present.
QLM and BKN support PZD's current living arrangements. QLM said that PZD keeps her house in "immaculate condition". They describe PZD as being very independent and just gets the help she needs that she helps through paid services. Both QLM and BKN spoke highly of the Medical Centre indicating their view that PZD receives good care.
QLM and BKN state that PZD has delusional beliefs about being very wealthy from being a successful author and this can impact on her decision making. By way of example, QLM said that Service Provider AB contacted her expressing concerns that PZD had made a booking to be transported to Airport YZ to meet some important people because she is a famous author. Service Provider AB were concerned as there is no Airport YZ and they were concerned otherwise about the booking.
On another occasion, QLM states she was contacted by Service Provider AB because PZD had made a booking to go to another suburb in regional NSW, however, when they arrived became agitated and distressed as the booking location could not be located and appeared to be fictitious also. Further, QLM was concerned when Service Provider AB contacted her to advise that they had received a cheque from QLM for $1.2 million. QLM considers that PZD's reason for writing the cheque was tied to her delusional beliefs about her wealth.
PZD did not take issue with the reports of Dr Z and Dr Y. When we spoke to her about the cheque for $1.2 million, she said that she wrote this so she did not have to keep writing smaller cheques. She said that because she has so much money, an amount of $1.2 million does not matter much to her. PZD indicated her wealth generated from being an author is very great, alluding to her having been very successful. She did not take issue with QLM's evidence about Service Provider AB having been contacting QLM directly due to their concerns about her decisions.
Dr Z's evidence that PZD remains psychotic is consistent with the evidence of QLM and BKN about her delusional beliefs. It is consistent also with Dr Y's evidence about the impact of PZD's schizophrenia on her decision making. We accept Dr Y's evidence regarding PZD's impaired decision-making as a result.
On the basis if this evidence we are satisfied that PZD has a disability, being schizophrenia such that she is at least in partially incapable of managing her person. She is a person for whom we could make a guardianship order.
Our decision turned however on whether we should exercise our discretion to make a guardianship order.

Should the Tribunal make a guardianship order and what order should be made?

The Tribunal must consider all of the following matters set out in s 14(2) of the Act before exercising its discretion to make a guardianship order: 1. the views (if any) of: 1. the person; 2. the person's spouse; 3. the person's carer; 1. the importance of preserving the person's existing family relationships; 2. the importance of preserving the person's particular cultural and linguistic environments; and 3. the practicability of services being provided to the person without the need for the making of such an order.
These matters have no hierarchy or weighting and each is a mandatory consideration. However, the Tribunal must undertake a balancing exercise for its consideration of the matters in s 14(2) of the Act. When undertaking this task the Tribunal may be guided by the principles that are set out in s 4 of the Act (see IF v IG [2004] NSWADTAP 3).
PZD's view was that she was managing well. Whilst she was open to her children assisting her, the thrust of her evidence was that there was no need for a guardian to be appointed for her. Whilst QLM and BKN agree with PZD's current living arrangements, they expressed concern about being able to "jump in and make a decision" if necessary. The effect of their evidence was that a guardianship order would be a "safeguard" that was necessary, particularly in view of recent events with her writing the $1.2 million cheque to Service Provider AB. They agreed however that with regard to services, an order would not make a difference as Service Provider AB is already contacting QLM directly about services. QLM said if there was an order she would "keep doing what she is doing already".
QLM and BKN stressed that PZD is receiving good care at the Medical Centre. They saw no difficulty in communicating with the staff there and saw no impediment to further psychiatric review or any treatment for mental health or otherwise being provided for PZD.
There was no evidence relevant under ss 14(2)(b) and (c) of the Act indicating that a guardianship order should be made. The evidence relevant to s 14(2)(d) of that Act indicted that services were already being provided without an order and that informal arrangements were in place and were effective in resolving concerns that had arisen about PZD's decision at times about her services.
In addition to the matters set out in s 14(2) of the Act, we had regard to the guiding principles set out in s 4 of that Act. The principles of most relevance were the need to protect PZD from neglect, abuse or exploitation and the need to encourage her so far as possible to live a normal life in the community. We also considered the importance of minimising any restriction to PZD's freedom of decision and action. As s 4(a) of the Act requires, we gave paramount consideration to PZD's welfare and interests. Ultimately, we decided that this would be better promoted by not making a guardianship order in all of the circumstances.
Taking all of these issues into consideration, we dismissed the application for a guardianship order. Whilst we take into account the views expressed by QLM and BKN, we place greater weight on the evidence indicating that there was no need for an order. Having dismissed the application on this basis, there was no need to address the other questions outlined above.

What did the Tribunal have to decide?

The questions to be considered by the Tribunal are:

Is PZD incapable of managing her affairs?
Is there a need for another person to manage PZD'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 PZD incapable of managing her affairs?

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].
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.
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.
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 [2015] NSWSC 579 at [309].

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].
We considered evidence concerning PZD's health and ability generally in the context of the application for a guardianship order. The medical evidence available to us demonstrates that PZD's decision-making incapacity extended to decisions concerning her financial affairs.
Dr Y considers that PZD's schizophrenia affects her capacity to make informed decisions about her financial affairs. She states that her illness allows her to be vulnerable to either internal or external suggestions that may lead her to make ill-advised or incorrect financial decisions. Dr Z states that whilst PZD is pleasant and is not a danger to herself, she remains psychotic and under psychiatric review.
It is not in issue that PZD wrote a cheque for $1.2 million to Service Provider AB. When we spoke with her about this, her reasoning was not sound. She could not account for why she should write a cheque for such a large amount when her invoices are around only one hundred or two hundred. She could not say why she would forego generating income say from interest from the $1.2 million by paying this over in a lump sum to Service Provider AB. The gist of her evidence was that it did not matter because she had so much money, being wealthy from being a successful author.
During the course of the hearing, PZD showed us her cheque book. Apart from regular payments to her service providers and other routine expenses, there was a cheque butt indicating a cheque for $800 to Ms X who is a carer with Service Provider AB. PZD said that she wrote this out directly to Ms X in addition to paying her usual invoice from Service Provider AB because had been doing a good job. PZD said she later changed her mind and did not give the cheque to Ms X.
QLM and BKN said there do not know many details of Ms X's financial affairs, however, that she owns her house in regional NSW and her income is by way of an age pension paid into her bank account. They say that PZD has not generated income from being an author and is not wealthy. They say that she has delusional beliefs.
QLM states that PZD's delusional beliefs about her finances extend to believing that she has large sums of money in accounts with a particular institution. QLM states that her inquires indicate that this institution does not exist. Whilst PZD also told us she has large sums of money in this institution, she was otherwise unable to provide details.
Whilst we accept that PZD is paying her bills and generally managing her everyday expenses, we accept QLM and BKN's evidence that she has shown poor decision-making about her finances. She is vulnerable to being financially exploited and is not making sound judgements. We accept Dr Y's evidence that her capacity to make informed decisions about her finances is affected by her schizophrenia.

Is there a need for a financial management order and is it in PZD's best interest that an order be made?

Whilst PZD felt that she was managing well with her finances, she was not opposed to QLM and BKN being appointed as her financial managers. We accept that this is necessary to ensure that PZD's income, assets and liabilities are appropriately managed in her interests and to protect her from being financially exploited.

Who should be appointed as financial manager?

In appointing a financial manager, as in making all other orders under the Act, the Tribunal must act with the interests of the person concerned as the paramount consideration and in accordance with the other principles set out in s 4 of the Act.
Section 25M of the Act provides that, if the Tribunal makes a financial management order, it may appoint a suitable person to manage the person's estate or may commit the management of the estate to the NSW Trustee and Guardian.
In Holt & Anor v Protective Commissioner (1993) 31 NSWLR 227, the Court said that the dominant consideration in making orders about financial managers was the welfare of the person. The President of the Court of Appeal emphasised the Court's broad discretion in deciding who should be financial manager but also set out possible considerations as to the competing advantages of the then Protective Commissioner and a family member as the manager of an estate. The NSW Trustee and Guardian now exercises the role of the Protective Commissioner.
On the side of the then Protective Commissioner was seen to be the manifest independence of the statutory office, the advantages of a dispassionate and neutral approach in situations of family conflict and divided views as to the best interests of the person, expertise and experience in managing estates, an impeccable reputation and the security provided to an estate against loss or damage.
The advantages of the appointment of a family member were more economic management of smaller estates (that is, freedom from fees) and a greater familiarity with assets and liabilities in smaller estates, a greater capacity of a person with a disability to interact with the manager so as to exercise a greater influence over the broad directions of the management of the estate, love and affection for and knowledge of the protected person and concern for his or her quality of life, and particular qualities or qualifications enabling family members to act as managers.
The Court considered that interrelated property interests in a family situation, where a conflict of interest and duty may be "more apparent than real", should not necessarily present an absolute bar to appointment of a family member who is otherwise appropriate. However, when appointing a family member, a decision maker must be satisfied that the estate, income and capital assets, will be utilised to advance the interests and quality of life of a protected person rather than to eventually increase the assets of the family.
In Application by AMAM; Re SAM [2011] NSWSC 503, Hallen AsJ stated: [34] It would be unwise to attempt any definition of the matters that may legitimately be enquired into to determine whether the applicant is suitable. Each case must depend on its own circumstances. Needless to say, however, the Court must consider, at least, the proposed manager's character, honesty and ability to manage, diligently, the managed person's property in the managed person's best interests.
The matters or "guidelines" that should be considered when determining who to appoint as financial manager, as established in Holt & Anor v Protective Commissioner (1993) 31 NSWLR 227, are discussed and expanded upon by Lindsay J in M v M [2013] NSWSC 1495 at [50].
QLM and BKN proposed that they be jointly and severally appointed as PZD's financial managers. BKN previously worked as an accountant for 17 years and for the last 20 years, has worked in sales in the information technology and has skills in managing finances. QLM works as an interior designer. Their evidence regarding the steps that they would take if appointed was measured and respectful of maintaining PZD's independence as much as possible whilst also protecting her interests. They said they would be able to communicate and work together.
As indicated above, whilst PZD felt that she was managing well with her finances, she was not opposed to QLM and BKN being appointed as her financial managers. She said she trusted them.
The evidence of BKN and QLM otherwise revealed no disqualifying factors that would prevent the acting as PZD's financial managers if appointed. They are aware that if appointed as PZD's financial managers they are required to work under the authorities and directions of the NSW Trustee and Guardian and be accountable to that office. They saw no difficulties in complying with these requirements.
We were satisfied that QLM and BKN were suitable persons to be jointly and severally appointed as financial managers for PZD subject to the authorities and directions of the NSW Trustee and Guardian.

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: 12 June 2020

Trustee and Guardian Act 2009(NSW)

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Judgment (11 paragraphs)

Legislation Cited (4)

Cases Cited (10)