ZCV v ZCW

NCAT Appeal Panel|2017-01-27

Overview

ZCV has appealed from a decision of the Civil and Administrative Tribunal sitting in the Guardianship Division (the Tribunal) of 8 April 2016. In its decision, the Tribunal appointed ZCW, ZCV's sister, as the financial manager of the estate of their mother, ZCX. For clarity, and with no disrespect intended, we refer to the ZCV as 'the son', ZCW as 'the daughter' and ZCX 'the mother'.
For the following reasons, the Appeal Panel has decided to allow the appeal, and order that the matter be remitted to the Tribunal for reconsideration.

Out of time?

There appeared to be an issue that the appeal had not been filed within 28 days of the decision of the Tribunal, as is required by the Civil and Administrative Tribunal Rules 2014 (NSW). However, the son told the Appeal Panel that he did not receive the Tribunal's decision until 26 May 2016, and that therefore the appeal, having been filed on 7 June 2016, had been filed within the 28 day time period required. The daughter did not challenge this evidence and agreed that the appeal could proceed. We find that the appeal was lodged within time.

Notice of Appeal

The son filed a Notice of Appeal on 7 June 2016. Attached to the Notice were over 100 pages of documents. These documents included the evidence before the Tribunal, together with submissions and a response to the daughter's Reply.
The Appeal Panel also had before it a bundle of documents titled "Reply to [the daughter's] Response which the son filed on 16 December 2016. This bundle consists of 28 pages, including a transcript of various telephone conversations between the son and the mother which took place both before and after the Tribunal hearing.
We have divided the son's grounds of appeal into the following categories: 1. (1) errors of fact made by the Tribunal in accepting his sister's evidence in preference to his own evidence (for instance, his sister's evidence in relation to the heating of their mother's home); 2. (2) inconsistencies in the Tribunal's reasoning (for instance, by finding that although he had not signed his acceptance of the Second EPOA, he was bound by a fiduciary duty not to obtain a benefit); 3. (3) the Tribunal decision was not fair and equitable (for instance, by the Tribunal failing to consider the issues surrounding the purchase of a headstone for his father); 4. (4) the Tribunal's decision was against the weight of the evidence (in particular, the Tribunal's findings at [102] and [103] of its Reasons that the son claimed that there were insufficient funds for the maintenance of the farm and the mother's home); and 5. (5) significant new evidence being available that was not reasonably available at the time of the hearing.

Reply to appeal

The daughter filed her Reply to Appeal on 5 July 2016. The Reply addresses factual matters before the Tribunal including: (1) the issue of heating in her mother's home, and the fact that she purchased a heater for her mother on 25 May 2015; (2) whether or not the son acted as an attorney for his mother. The daughter claims that the son did act as an attorney by redirecting their mother's mail, undertaking ATM transactions on their mother's account, depositing a cheque of $18,590.00 into his own account and transferring only $9,300.00 to their mother; taking their mother to the bank on 24 November 2014 and causing her to draw a bank cheque for $6,150.00 and ordering a headstone for their late father.
The daughter also submitted that the son had failed to provide her with financial information such as invoices and bank statements which she needs to complete her mother's tax return and the farm tax return, despite repeated requests to do so.

The son's response to the Reply

In summary, the son denies each of the allegations made by his sister, and says that she was lying when she gave her evidence to the Tribunal.

Nature of the Appeal

This appeal, being an appeal from a decision of the Guardianship Division of the Tribunal to the Appeal Panel, is an "internal appeal" for the purposes of the Civil and Administrative Tribunal Act 2013 (the NCAT Act), s 32. Internal appeals can be made as of right on any question of law, or with leave of the Appeal Panel on any other grounds: NCAT Act, s 80(2)(b).
Section 81 of the NCAT Act sets out the orders that may be made on appeal: 81 Determination of internal appeals (1) In determining an internal appeal, the Appeal Panel may make such orders as it considers appropriate in light of its decision on the appeal, including (but not limited to) orders that provide for any one or more of the following: (a) the appeal to be allowed or dismissed, (b) the decision under appeal to be confirmed, affirmed or varied, (c) the decision under appeal to be quashed or set aside, (d) the decision under appeal to be quashed or set aside and for another decision to be substituted for it, (e) the whole or any part of the case to be reconsidered by the Tribunal, either with or without further evidence, in accordance with the directions of the Appeal Panel. (2) The Appeal Panel may exercise all the functions that are conferred or imposed by this Act or other legislation on the Tribunal at first instance when varying, or making a decision in substitution for, the decision under appeal.
We note that a court or tribunal "ought not be astute to find fault with the reasoning process of Tribunals whose decisions are the subject of an appeal or are being reviewed": Absolon v NSW TAFE [1999] NSWCA 331; Minister for Immigration and Ethnic Affairs v Wu Shan Lian [1996] HCA 6; (1996) 185 CLR 259.

A question of law?

The Appeal Panel in Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69 considered the requirements for establishing an "error of law" giving rise to an appeal as of right and noted at [11] that, in circumstances where appellants are not legally represented, a decision maker may look at the grounds of appeal generally. Without expressing exhaustively every possible question of law, the Appeal Panel in Prendergast referred at [13] to the following as raising questions of law: (1) whether there has been a failure to provide proper reasons; (2) whether the Tribunal identified the wrong issue or asked the wrong question; (3) whether a wrong principle of law has been applied; (4) whether there was a failure to afford procedural fairness; (5) whether the Tribunal failed to take into account a relevant (mandatory) consideration; (6) whether the Tribunal took into account an irrelevant consideration; (7) whether there was no evidence to support a finding of fact; (8) whether the decision was so unreasonable that no reasonable decision-maker would have made it.
For the reasons that follow, we consider that the Tribunal, in reaching its decision to appoint the daughter as the financial manager for the mother: (1) applied a wrong principle of law; and (2) made a finding without evidence or reasoned illogically.
These are errors of law. We consider that a differently constituted Tribunal should reconsider the whole case in accordance with these reasons.
Having reached this conclusion, there is no need for us to deal with the son's other grounds of appeal on questions of law; decide whether to give leave for the son to appeal on grounds other than questions of law; or consider whether we should admit fresh evidence sought to be relied on.

Tribunal's decision

As the Tribunal noted in its reasons, before it could make a financial management order, it had to be satisfied that: 1. (1) the mother was not capable of managing her affairs; 2. (2) there was a need for another person to manage the mother's affairs on her behalf; and 3. (3) it is in the best interests of the mother that a financial management order be made: Guardianship Act 1987 (NSW), s 25G.
The Tribunal was satisfied as to each of these matters and no ground of appeal relates to these findings.
The Tribunal then had to decide who should be appointed as the mother's financial manager. The Tribunal may "appoint a suitable person as manager of that estate, or commit the management of that estate to the NSW Trustee": Guardianship Act, s 25M.
The son suggested himself, and submitted that the daughter was not suitable. The daughter suggested herself, and submitted that the son was not suitable. The Tribunal noted that the mother said that she would like either her son or her daughter to be appointed as financial manager, and was strongly opposed to the notion of an independent financial manager such as the NSW Trustee and Guardian being appointed. The Tribunal decided to appoint the daughter.
We consider that the Tribunal erred in reaching this decision.

Applying a wrong principle of law

The decision was based on several findings including the Tribunal's finding that at [101] that When [the son] was appointed as an attorney, notwithstanding the fact that he felt that the [Second EPOA] could not be operated, he was bound by a fiduciary duty not to obtain any person [sic - personal] benefit … and to keep records and accounts. He also had a duty to avoid any conflict of interest.
The findings that the son was bound by a fiduciary duty and also had a duty to avoid any conflict of interest are errors of law because, for the reasons we explain below, the son was not legally bound by any such duties. The Tribunal applied an incorrect principle of law or misapplied the law in making these findings.
When determining whether the son was a suitable person to be his mother's financial manager, the Tribunal made a finding of fact at [102] that the son had asserted that there were insufficient funds available for the maintenance of the farm. The Tribunal went on to find, at [103] that the son's acceptance of a gift from his mother of $9,300.00 was inconsistent with his concern about lack of available funds. At [105] - [106] the Tribunal concluded that the son's acceptance of the gift from his mother was a conflict of interest and that, on that basis, he was not a suitable person to be appointed as financial manager.
The son said that his mother wanted to give him $9,300.00 as a payment for looking after the farm for many years. The son said that his mother noted this on a Christmas card, and that she had wanted to give him money in the past but on this occasion she insisted. The daughter did not give evidence which contradicted the son's assertion, nor did the Tribunal question that evidence. However, the Tribunal found at [105], that "because of the issue with the gift", and the son's conflict of interest, it was not appropriate to appoint him as financial manager.
The acceptance of the gift did not give rise to a conflict of interest because, contrary to the Tribunal's finding at [101], the son was not bound by a fiduciary duty not to obtain any personal benefit or to avoid any conflict of interest. What the Tribunal described as a "conflict of interest" arose, the Tribunal found, because of the appointment of the son as his mother's attorney. True it is that the mother appointed the son as one of her two joint attorneys pursuant to the Second EPOA, but the daughter did not accept her appointment as a joint attorney. Even accepting that the son did accept his appointment (as claimed at the appeal hearing, but not accepted by the Tribunal), the Second EPOA never commenced to operate in accordance with cl 4. Therefore, the obligations of an attorney, including the obligations of a fiduciary including the obligation not to hold a conflict of interest, never arose. As the son correctly submitted at p 12 of his submissions: There was NO Power of Attorney appointment validated, because both nominees did not sign the acceptance. I cannot act as a single attorney, so there was NO Power of Attorney in operation, NO fiduciary obligation and NO conflict of interest.
A similar submission is repeated at p 15. Given these matters, the Tribunal erred in its findings at [101].
The Tribunal stated at [106] that "[on] that basis" it was not satisfied that the son was a suitable person to be appointed as financial manager for the mother. In doing so, the Tribunal appears to be referring to its findings at [101] (set out above) and at [105] that his acceptance of a gift from his mother represented a conflict of interest.

Making a finding without evidence or reasoning illogically

The son disputes the following findings of the Tribunal: [102] However, on the basis of his own evidence, [the son] accepted a gift of $,9,300 from his mother, in circumstances where he now asserts that there are insufficient funds available for the maintenance of the farm. [103] Whilst it is [the mother]'s absolute right to confer gifts upon whoever she wishes, [the son]'s decision to accept that gift is inconsistent with his expressed concern about the lack of available funds for the maintenance of the farm and [the mother]'s house.
The son submits that the findings are "completely false". He submits that his concern about the funding for maintenance of the farm and his mother's house is "very clearly about access to funds, not [the] amount of funds."
His submission is supported by his statement dated 24 October 2015, which was before the Tribunal. There, he relevantly states: [17] The farm is going to ruin and needs urgent maintenance work carried out. There are many things we can do ourselves, but not at my own personal expense. We need to carry out major work for which we need to pay money to do as it requires specialised equipment, such as fencing. The week [sic - weed] control now out of control and we need to pay someone to come in and do it. Road and bridge works are also required on the farm. [18] [My sister] controls my mother's finances. She has taken my mother's Credit Card and Cheque book and is a signatory on some of mother's bank accounts. … [24] I am concerned that my mother is not being looked after properly by my sister and that she does not have access to her own finances. [25] I am concerned that the farm is going to ruin and that major works that need to be carried out are not being done because [my sister] withholds all my mother's funds. [26] I do not have the finances to pay for the work that needs to be carried out myself.
The son was clearly saying that there were sufficient funds for the maintenance of the farm, but that the daughter was not making those funds available.
His submission also appears to be supported by the observation of the Tribunal at [110] that there had been a difference of opinion about how to prioritise the release of funds.
It is arguable that the Tribunal's reference to available funds at [102] and [103] is a reference to an assertion by the son that the mother did not have sufficient funds to maintain the farm. If that is what the Tribunal meant, there was no evidence for that finding. The Appeal Panel has, with the agreement of the parties, listened to the sound recording of the Tribunal hearing and there was no evidence given to that effect. A finding made without evidence is an error of law: Azzopardi v Tasman UEB Industries Ltd (1985) 4 NSWLR 139.
Alternatively the Tribunal's reference to available funds at [102] and [103] is a reference to an assertion by the son that the daughter was not making sufficient funds available to him. If that is what the Tribunal meant, it was not logical for the Tribunal to find that accepting a gift was inconsistent with the fact that the daughter was not making funds available to maintain the farm.
Either the Tribunal has made an error of law or has reasoned illogically in the findings it made at [102] and [103]. That is a further reason for upholding the appeal and remitting the matter to be reconsidered with any further evidence that the Tribunal allows.

Orders

The Appeal Panel orders: 1. The appeal is allowed. 2. A differently constituted Tribunal is to reconsider the Tribunal's decision to appoint ZCW as the financial manager of the estate of ZCX.

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

Amendments 08 March 2017 - Amendment to Order 2. 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: 08 March 2017

At a glance

Court

Decision date

Source

Judgment (14 paragraphs)

Parties

Legislation Cited (3)

Cases Cited (5)