ZIJ is a 71-year-old woman who lives at an aged care facility in regional NSW. Up until hearings in the Tribunal in January and February 2018 and for some years prior, ZIJ and her de facto partner, ZII (the appellant), shared a home in regional NSW.
ZIJ has two children: ZIL (ZIJ's son) and ZIK (ZIJ's daughter).
On 5 July 2004, ZIJ appointed her son and her daughter as her enduring guardians and attorneys (2004 appointment of enduring guardians and 2004 enduring power of attorney respectively).
On 18 July 2017, ZIJ revoked the 2004 appointments.
On the same date, ZIJ appointed the appellant and ZIM (ZIJ's brother) as her enduring guardians and attorneys (2017 appointment of enduring guardians and 2017 enduring power of attorney respectively).
The 2017 enduring power of attorney appointed the two attorneys on a joint and several basis. By not crossing out two clauses in the standard form, ZIJ also authorised her attorneys to give reasonable gifts as provided by s 11(2) of the Powers of Attorney Act 2003 (NSW) (Powers of Attorney Act) and to confer benefits on themselves to meet the attorneys' reasonable living and medical expenses as provided by s 12(2) of the Powers of Attorney Act. These were not matters that the attorneys under the revoked 2004 enduring power of attorney were authorised to do.
On 8 August 2017, ZIJ's daughter applied to the Tribunal for guardianship and financial management orders in respect of her mother, and a review of the 18 July 2017 revocation of the 2004 enduring power of attorney (2017/240685).
On 10 October 2017, ZIJ's son applied to the Tribunal to review the 2017 appointments of the appellant and ZIJ's brother as ZIJ's enduring guardians and attorneys.
On 10 January 2018, the Tribunal conducted a hearing and made an order revoking the 2017 appointment of the appellant and ZIJ's brother as ZIJ's enduring guardians on the basis that it was in ZIJ's best interests to do so.
On the same date, the Tribunal made a guardianship order that appointed the Public Guardian as ZIJ's guardian for 12 months with decision-making authority about access, accommodation, health care, medical and dental treatment and services.
The remainder of the applications in proceedings 2017/240685 were adjourned on a part heard basis.
On 20 February 2018, the hearing resumed and after reserving its decision, the Tribunal made orders on 22 February 2018 declaring that ZIJ did not have the mental capacity to revoke the 2004 enduring power of attorney and did not have the mental capacity to make the 2017 enduring power of attorney. The 2004 enduring power of attorney, that appointed ZIJ's son and daughter jointly as her attorneys, was declared by the Tribunal to remain valid in whole.
The Tribunal also made a financial management order that committed the management of ZIJ's estate to the NSW Trustee and Guardian and is to be reviewed within 12 months. The 2004 enduring power of attorney is suspended whilst ZIJ's estate is the subject of the financial management order (Powers of Attorney Act, s 50(3)).
The appellant filed a notice of appeal on 9 March 2018.
We heard the appeal on 1 June 2018 and at the conclusion of the hearing directed that any party wishing to make written submissions concerning ZIJ's capacity to revoke the 2004 enduring power of attorney on 18 July 2017 may do so within 14 days.
We otherwise reserved our decision.
For the reasons set out below, we now dismiss the appeal.
[2]
Appeal framework
The decision under appeal in this matter is an "internally reviewable decision" (Civil and Administrative Tribunal Act 2013 (NSW) (CAT Act), ss 4 and 32(4)). A party may appeal an internally reviewable decision on any question of law (CAT Act, s 80(2)(a)) or with the leave of the Appeal Panel on any other ground (CAT Act, s 80(2)(b)).
[3]
Notice of appeal
The appellant filed a Notice of Appeal that was stamped as having been received by the Tribunal on 9 March 2018. In completing the details of the decision appealed against, the Notice of Appeal referred only to the decisions made on 22 February 2018 (following the hearing conducted on 20 February 2018). However, the attachments to the Notice of Appeal indicate that the appellant also intended in appeal to challenge the orders made on 10 January 2018. At the appeal hearing the appellant confirmed that this was the case and none of the other parties or the separate representative raised any objection to the Appeal Panel hearing the appeal against the orders made on both dates.
The appellant requested that we make orders
…to the effect that [ZIJ] did have legal capacity when four documents were signed and witnessed by a Prescribed Witness on 18 July 2017.
Such orders should restore [ZIJ's] appointed trustee and guardian as expressed in her signed documents.
Such orders should reverse the appointment of the Public Guardian.
Such orders should reverse the appointment of the NSW Trustee and Guardian as manager of [ZIJ's] affairs.
During the course of his oral submissions, however, the appellant conceded that he did not dispute the findings made by the Tribunal that by the time of the hearings on 10 January and 20 February 2018, ZIJ lacked capacity to make decisions. The appellant accepted that the guardianship and financial management orders could be made for ZIJ because of her cognitive decline. He remained of the view, however, that those orders should not have been made because there was no need for them. This was because the appointments made by ZIJ on 18 July 2017 of the appellant and her brother as her attorneys and enduring guardians provided a mechanism for decision making to occur on her behalf in the event that she could not make those decisions for herself.
For the reasons given, however, we have dismissed the appeal.
[4]
Interlocutory matters
On 27 March 2018 directions were made as to the filing and exchange of documents between the parties. This included directions to all parties (Direction 1(a) and 2(a)) that by a stated date they were to lodge with the Tribunal and give to the other parties all of the evidence provided to the Tribunal below on which the party intended to rely.
On the day of the appeal, as none of the parties had submitted the following documents in accordance with Direction 1(a) or 2(a), they were handed up and marked as exhibits before the Appeal Panel:
1. Each of the instruments that were the subject of review proceedings before the Tribunal below;
2. A bundle of reports that had been in evidence before the Tribunal below (ACAT assessment and associated documents dated 28 March 2007; Letter from Dr Z to Dr Y dated 4 July 2017; Letter from Professor X to Dr Z dated 31 January 2017);
3. Copies of handwritten notes to ZIJ's children signed by ZIJ but written by the appellant.
On 27 March 2018, the parties had also been directed to lodge with the Tribunal and give to the other parties (the appellant by 24 April 2018 and the other parties by 15 May 2018) the sound recording of the hearing at first instance if what happened at the hearing was being relied on in the appeal as well as a typed copy of the relevant parts.
ZIJ's son submitted a sound recording of the hearings and an informal transcript of selected parts of the hearings conducted on 10 January and 20 February 2018. There was no objection from any other party or the separate representative as to the informal transcript submitted.
The appellant did not file a typed copy of the sound recording.
[5]
Separate representation
At the same directions hearing a separate representative was appointed for ZIJ (CAT Act, s 45(4)). Mr Ben Fogarty participated in the appeal hearing before us in this role.
The separate representative made written and oral submissions that may be summarised as follows.
On 18 May 2018, the separate representative used a tablet device for a FaceTime call with ZIJ that was facilitated by a registered nurse at the aged care facility. Based on his discussions with ZIJ, the separate representative formed the view that ZIJ "has significant cognitive problems, with memory, orientation and language". The separate representative observed that despite her cognitive deficits, ZIJ said that she wanted to be with her family and to be safe and sound and made reference to her children and the appellant.
Based on his communication with ZIJ and his review of the documents filed in these proceedings, the separate representative submitted that ZIJ is not capable of providing instructions to him about the appeal as a result of her cognitive disability due to dementia, and there is a need for another person to manage ZIJ's financial affairs and personal decisions. There is presently "irreconcilable conflict and little to no trust" between the appellant on the one hand and ZIJ's two children on the other, with ZIJ's brother "caught in the middle". It was the separate representative's view that should any of the family members be appointed guardian, they would not consult with all of the other family members with whom they are in conflict and may impede access to ZIJ.
The separate representative submitted that it was in ZIJ's interests that her estate is managed in such a way that it ensures that she remains in full time supported accommodation, she remain in contact with all of her family members and is not prevented from seeing any of them and she not be exposed to any conflict there may be between them.
The separate representative submitted that it was open to the Appeal Panel to find that none of the appeal grounds are made out, to dismiss the appeal and affirm the orders made below.
Neither the Public Guardian nor the NSW Trustee and Guardian took part in the appeal.
[6]
Grounds of appeal and consideration
Under the heading "Grounds of appeal", the appellant provided seven paragraphs. The appellant told us that he prepared these grounds of appeal prior to receiving the written reasons of the Tribunal for the orders made on 10 January 2018 and 22 February 2018. However, he wished to supplement the grounds of appeal with written submissions stamped as having been received by the Tribunal on 25 May 2018 which the appellant said he prepared after receiving the Tribunal's written Reasons for Decision. No objection was raised about this by the other parties or the separate representative.
In his oral submissions at the appeal hearing, the appellant confirmed that the grounds of appeal at paragraphs 2, 3 and 4 of the Notice of Appeal were subsets of the first paragraph which represented what we understood was one of the appellant's main concerns about the Tribunal's decision, namely, that the Tribunal's findings that ZIJ did not have the mental capacity on 18 July 2017 to revoke certain instruments and make new instruments was against the weight of the evidence, in particular the evidence that Mr W, Registrar of a Local Court in regional NSW, signed and witnessed the documents. In oral submissions, the appellant clarified that this concern related mainly to the Tribunal's findings in relation to the revocation on 18 July 2017 of the 2004 enduring power of attorney and the making of the new enduring power of attorney on the same date.
In the Notice of Appeal under the heading "Reasons why the NCAT Appeal Panel should grant leave to appeal against the decision", the appellant further wrote:
Leave to appeal is sought as the decisions and orders of the Tribunal are significantly a clear injustice to the wishes and decisions of [ZIJ] made at a time when her legal capacity was confirmed.
The decisions of the Tribunal were against the weight of the evidence taken including further confirmation of [ZIJ's] legal capacity from her solicitor in taking instructions and the report of the NCAT case officer in her report to the Tribunal.
The decisions of the Tribunal have also cast negative assertions on the professional conduct of the Court Registrar as a Prescribed Witness without any evidence.
As the appellant was unrepresented, we assisted him to define his grounds of appeal following further clarification by him in his written and oral submissions (see Neill v Nott [1994] HCA 23). As a result, we understood his appeal grounds to be as follows:
1. The Tribunal misapplied the law when it failed to commence its consideration of ZIJ's capacity to make and revoke the instruments on 17 July 2018 from the presumption that ZIJ did have the requisite capacity to do so;
2. The Tribunal's decision was against the weight of the evidence because it placed excessive weight on some issues and dismissed other relevant evidence when it made findings that ZIJ did not have the mental capacity on 18 July 2017 to revoke the 2004 enduring power of attorney or the mental capacity to make the new enduring power of attorney and caused a clear injustice to ZIJ;
3. That there was no evidence before the Tribunal that the appointments made by ZIJ on 17 July 2018 were not operating in the best interests of ZIJ;
4. The Tribunal failed to have regard to ZIJ's views about who she wished to appoint as her decision maker/s;
5. The conduct of hearing on 10 January 2018 was unfair as the Tribunal did not allow time for the appellant to test false and misleading statements made by other witnesses.
The grounds articulated at (a) and (e) above raise questions of law (John Prendergast & Vanessa Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69, [13]-[18]) and the appellant may appeal these as of right.
[7]
Ground of appeal (a) - Presumption of capacity
In oral submissions, the appellant asserted that the Tribunal did not begin its consideration of ZIJ's capacity on 18 July 2017 to make the new enduring power of attorney and to revoke the 2004 enduring power of attorney from the correct starting point, namely, that the Tribunal should have presumed that ZIJ did have the mental capacity to take those steps. The appellant argues that there is no indication in the Reasons for Decision for the orders made on 22 February 2018 that the Tribunal did in fact start from that point. As we understood the appellant's position, this error then flowed on to the way in which the Tribunal considered the evidence in relation to ZIJ's capacity to execute the relevant documents on 18 July 2017.
ZIJ's son and daughter both submitted that the Tribunal did apply the presumption of capacity.
The separate representative in oral submissions submitted that while the 22 February 2018 written Reasons for Decision do not appear to reflect that the Tribunal expressly applied the presumption of capacity to ZIJ, the medical evidence before the Tribunal is likely in any event to have rebutted the presumption.
[8]
Discussion
The common law presumption that a person of full age is capable of managing his or her affairs unless the presumption is rebutted is well established (Murphy v Doman (2003) 58 NSWLR 51, [34]-[36] (per Handley JA); Scott v Scott [2012] NSWSC 1541, [233]; Coffey v Coffey (No. 2) [2015] NSWSC 338, [15]-[19]).
Further, in relation to the test for capacity to perform legally valid acts, such as revoking an enduring power of attorney or making an enduring power of attorney, the authorities confirm that the starting point is the "presumption of sanity" (Szozda v Szozda [2010] NSWSC 804, [20]-[26], Barrett J). This does not, however, necessarily equate to the strict application of an onus on a party seeking to establish the incapacity of a principal, particularly in a protective jurisdiction where the obligation to "consider the interests of a person in need of protection, and to do so, if necessary, untrammeled by competing adversarial contentions, may have an impact, in particular cases, on whether or not an onus of proof (wherever it might reside) is discharged" (Scott v Scott [2012] NSWSC 1541, [236]-[237], Lindsay J).
We have some sympathy for the appellant's view that the Tribunal did not commence from the starting point that ZIJ had the mental capacity to revoke the 2004 enduring power of attorney or to make the 18 July 2017 enduring power of attorney. There does not appear to be any explicit reference in the written Reasons for Decision relating to the orders made on 22 February 2018 that the Tribunal began from the premise that ZIJ had the mental capacity to execute the documents on 18 July 2017. There are also aspects of the reasoning and language used in the written Reasons for Decision that could be understood as reversing the presumption or onus.
Nevertheless, when the Tribunal's 22 February 2018 Reasons for Decision are looked at as a whole, we are not persuaded that error is established on this ground. Although the Tribunal did not make express reference to the presumption of capacity that applies, the findings made by the Tribunal show that the Tribunal did not misapply the presumption when it came to making critical findings to support the orders that it made in relation to ZIJ's capacity to make the new enduring power of attorney on 18 July 2017. Nor, when the reasons are looked at as a whole, was the presumption misapplied in the manner in which the Tribunal considered ZIJ's capacity to revoke the 2004 enduring power of attorney.
This ground of appeal is not established
[9]
Ground of appeal (e) - Denial of procedural fairness
As we understood the appellant's submissions on this ground, he asserted that the following matters led to the hearing on 10 January 2018 being procedurally unfair. The Tribunal:
had an onerous amount of information to go through prior to the hearing that had been provided by ZIJ's son and daughter about the appellant, much of which was false, misleading and often contradictory. The Tribunal was clearly swayed by this material
did not at the hearing test or permit to be tested the false and misleading statements prior to making their decision
ran out of time for the hearing on 10 January before reserving the decision which meant that the appellant was not given the chance to test the evidence given against him in the documents supplied by the other parties
[10]
Discussion
Section 38(2) of the CAT Act states:
The Tribunal is not bound by the rules of evidence and may inquire into and inform itself on any matter in such manner as it thinks fit, subject to the rules of natural justice.
Section 38(5)(c) of the CAT Act states:
The Tribunal is to take such measures as are reasonably practicable... to ensure that the parties have a reasonable opportunity to be heard or otherwise have their submissions considered in the proceedings.
The obligation of the Tribunal to accord procedural fairness in relation to Guardianship Division proceedings is summarised in BTD v NSW Trustee and Guardian [2015] NSWCATAP 87 (at [14]-[15]) as follows:
[14] The Guardianship Division is required to comply with the rules of procedural fairness, which are also known as the rules of natural justice: NCAT Act, s 38(2). Those rules require that a person be afforded a fair and unbiased hearing before decisions are taken which affect them: Aronson, Dyer and Groves, Judicial Review of Administrative Action, (5th ed 2013 LawBook Co) at 397. In particular the hearing rule, which is an element of procedural fairness, requires that a decision-maker hear a person before making a decision affecting their interests. McHugh J spoke generally of this rule in Re Refugee Tribunal; ex parte Aala [2000] HCA 57; (2000) 75 ALJR 52 at 73:
One of the fundamental rules of the fair hearing doctrine is that a decision-maker should not make an adverse finding relevant to a person's rights, interests or legitimate expectations unless the decision-maker has warned that person of the risk of that finding being made or unless the risk necessarily inheres in the issues to be decided. It is a corollary of the warning rule that a person who might be affected by the finding should also be given the opportunity to adduce evidence or make submissions rebutting the potential adverse finding (Mahon v Air New Zealand Ltd [1983] UKPC 29; [1984] AC 808 at 820-821.)
[15] The content of the hearing rule must be "appropriate and adapted to the circumstances of the particular case": Kioa v West [1985] HCA 81; (1985) 159 CLR 550 per Mason J at 585. The Guardianship Division's jurisdiction is a protective one. One of its primary aims is to protect vulnerable people from neglect, abuse and exploitation: The Act 1987 (NSW), s 4(g). But that is not its only obligation. The Guardianship Division of the Tribunal is also obliged to ensure that people who are parties to applications receive a fair hearing from an impartial decision-maker. The Tribunal is obliged to disclose to parties who have an interest in the proceedings, the substance of any adverse or prejudicial information and give them a reasonable opportunity to respond: KV v Protective & Ors; KW & Ors v KV & Ors (No.2) [2004] NSWADTAP 48.
In determining whether the appellant was denied procedural fairness, the question for the Appeal Panel is whether he had a reasonable opportunity to respond to any adverse or prejudicial information.
In the proceedings below, a directions hearing was conducted on 19 October 2017 as a result of which the parties were directed to file and serve documents that they wished to rely on in the proceedings by 29 December 2017. As we understand the manner in which the case proceeded below, although ZIJ's children provided material to both the Tribunal and other parties in accordance with these directions, the appellant did not. The directions provided all parties with an opportunity to provide evidence and submissions in support of their position, to understand the position of the other parties in advance of the hearing and to have the Tribunal consider this material prior to the hearing date. It does not appear that the appellant availed himself of this opportunity. Nor has the appellant directed us to those parts of the evidence accepted by the Tribunal that he asserts were based on false, misleading or contradictory evidence given by ZIJ's children.
We also note that there was nothing before us, other than the appellant's assertion, to suggest that the manner in which the Tribunal conducted the hearing on 10 January 2018 prevented him from presenting his case or that he was denied a fair hearing.
As previously noted, at a callover before a differently constituted Appeal Panel on 27 March 2018, a direction was made that the appellant was to give to the Tribunal and the other parties by 24 April 2018 "the sound recording of the hearing at first instance, if…what happened at the hearing is being relied on and a typed copy of the relevant parts" (Direction 1(d)).
The appellant did not provide a transcript of the proceedings below or an audio recording of those proceedings and he could not explain why he had not done so in light of his argument on this ground of appeal. Nor did the appellant take us to any part of the informal transcript provided by ZIJ's son to support his argument.
The ground of appeal asserting a denial of procedural fairness is not established.
[11]
Other grounds of appeal
To appeal on grounds other than a question of law the appellant must obtain the Tribunal's permission or leave.
The principles which govern the granting of leave to appeal pursuant to s 80(2)(b) of the CAT Act are set out in Collins v Urban [2014] NSWCATAP 17 at [84]:
(1) In order to be granted leave to appeal, the applicant must demonstrate something more than that the primary decision maker was arguably wrong in the conclusion arrived at or that there was a bona fide challenge to an issue of fact: BHP Billiton Ltd v Dunning [2013] NSWCA 421 at [19] and the authorities cited there, Nakad v Commissioner of Police, NSW Police Force [2014] NSWCATAP 10 at [45];
(2) Ordinarily it is appropriate to grant leave to appeal only in matters that involve:
(a) issues of principle;
(b) questions of public importance or matters of administration or policy which might have general application; or
(c) an injustice which is reasonably clear, in the sense of going beyond merely what is arguable, or an error that is plain and readily apparent which is central to the Tribunal's decision and not merely peripheral, so that it would be unjust to allow the finding to stand;
(d) a factual error that was unreasonably arrived at and clearly mistaken; or
(e) the Tribunal having gone about the fact finding process in such an unorthodox manner or in such a way that it was likely to produce an unfair result so that it would be in the interests of justice for it to be reviewed, BHP Billiton Ltd v Dunning [2013] NSWCA 421 at [20] and the authorities cited there, SAB v SEM [2013] NSWSC 253 at [8] and [9] and the authorities cited there, Nakad v Commissioner of Police, NSW Police Force [2014] NSWCATAP 10 at [45];…
See also SAB v SEM [2013] NSWSC 253, [8]-[10] (White J); C v W [2015] NSWSC 1774, [44]-[46] (Lindsay J); P v NSW Trustee and Guardian [2015] NSWSC 579, [191] (Lindsay J).
[12]
Were the findings that ZIJ did not have the mental capacity on 18 July 2017 to revoke the 2004 enduring power of attorney or make the new enduring power of attorney against the weight of the evidence? (Ground (b))
In his written submissions the appellant originally included the appointment by ZIJ on 18 July 2017 of her brother and the appellant as her enduring guardians in this ground of appeal. However, as the Tribunal did not make findings about ZIJ's capacity to execute this document but decided to revoke the 2017 appointment of enduring guardians on other grounds, the appellant acknowledged that he was concerned mainly with the findings that the Tribunal made following the second hearing on 20 February 2018. These findings were that ZIJ did not have the mental capacity on 18 July 2017 to revoke the 2004 enduring power of attorney or make the new enduring power of attorney on the same date.
As we understood the appellant's argument, he asserted that, in determining that ZIJ did not have the requisite mental capacity on 18 July 2017 in relation to both documents, the Tribunal failed to give the weight that it should have to the evidence of Mr W, a Registrar of the Local Court in regional NSW, who witnessed ZIJ's execution of both the revocation of the 2004 enduring power of attorney and the making of the 2017 enduring power of attorney. The appellant submitted that the Tribunal:
should have placed greater weight on the evidence that the instruments executed on 18 July 2017 complied with the requirements of the Powers of Attorney Act, Mr W fully complied with his obligations as a prescribed witness and ZIJ met the requirements in relation to her understanding of the powers and the long term implications to the satisfaction of Mr W
"severely discounted" Mr W's evidence as he was unable to recall many details of his meeting with ZIJ approximately seven months earlier, of which he has many meetings in his role as Registrar
placed little weight on Mr W's evidence as he uses a "standard set of questions" to test capacity, when it should have accepted that Mr W stated that he develops open ended questions until he is satisfied with capacity and conducted his business as he was supposed to
In relation to the Tribunal's decision that ZIJ did not have the capacity on 18 July 2017 to revoke the 2004 enduring power of attorney, the appellant asserted that the Tribunal placed too much weight on:
ZIJ signing a document which contained two errors (in relation to the date of the power of attorney she purported to revoke and the spelling of her daughter's first name). The appellant asserted that the Tribunal falsely linked ZIJ's reading skills in failing to detect two very simple errors as evidence that she did not understand what she was signing
ZIJ not being able to explain a full understanding of all of the consequences of revoking the 2004 enduring power of attorney. The applicant submitted that "this is an unachievable condition that very few persons would normally be able to master"
In relation to the Tribunal's decision that ZIJ did not have the capacity on 18 July 2017 to make the new enduring power of attorney, the appellant asserted that:
the Tribunal also applied too onerous a test on ZIJ in setting out what she needs to have understood about the consequences of signing the new enduring power of attorney and that "very few people signing such documents would know the consequences" if the same test applied by the Tribunal were applied to them
the Tribunal incorrectly placed great weight on ZIJ changing the powers given to the attorneys describing them as having "significant consequences" whereas ZIJ was making no changes to the powers to be granted but wished to change the attorneys as she had lost trust in her children to carry out her wishes and acting in her best interests
The appellant submitted that, in placing the weight that it did in relation to each of these matters, the Tribunal failed to give the weight that it should have to the fact that no medical or legal assessment had been made that ZIJ lacked capacity to understand and sign these documents. Nor did the Tribunal attempt to seek any medical evidence that ZIJ lacked the requisite capacity. Their failure to do so led the Tribunal to accept at face value the false assertions and statements made by ZIJ's children that she lacked capacity.
[13]
Purported revocation on 18 July 2017 of 2004 enduring power of attorney
In relation to the mental capacity required for a person to validly revoke an enduring power of attorney, the Tribunal expressed their view (at [51]) that the test laid out by the High Court in Gibbons v Wright (1954) 91 CLR 423 "means that when a person revokes their power of attorney, they need to be capable of understanding what they are doing and the consequences of doing it".
The Tribunal then proceeded to outline the two bases upon which it found that, applying the test as they described it, ZIJ did not have the requisite mental capacity to revoke the 2004 enduring power of attorney. Firstly, the Tribunal said that it placed "great weight on the fact that ZIJ signed the revocation form although it incorrectly described the date of the power of attorney being revoked and incorrectly spelt ZIK's [first] name". The reasoning explaining why the Tribunal placed "great weight" on these two factors is set out at [53]-[60].
In relation to the incorrect use of the date on the document, the date of the 2004 enduring power of attorney was incorrectly referred to as "22 January 2016 or thereabouts" (at [54]) (rather than 5 July 2004). The Tribunal expressed (at [57]) "significant concerns…especially since it was wrong by twelve years" describing it as a "significant discrepancy". The Tribunal also referred to evidence that the existence of the power of attorney executed in 2004 was discussed at annual meetings between ZIJ and her financial adviser and that she had therefore been reminded at least once a year about the power of attorney and the fact that it was in place before 2016 ([58]).
In relation to the misspelling of her daughter's first name (ending with "ine" instead of "yn"), the Tribunal appeared to place weight on evidence provided by ZIJ's son that ZIJ had always been extremely particular about the correct spelling of her daughter's name and it was out of character for her not to correct such an error ([59]).
In the Tribunal's view (expressed at [60]):
the fact that [ZIJ] could not identify and correct two very simple, glaring errors in the revocation document was strong evidence that she did not understand what she was signing.
Secondly, the Tribunal found that ZIJ did not understand the consequences of revoking the 2004 power of attorney. The reasoning explaining this is set out at [61]-[79].
The evidence accepted by the Tribunal (at [65]) was that:
[ZIJ] wanted to "end" the power of attorney appointing her children. This was clear from her statements to [the appellant] and [her brother] and was reported by [Dr Z] and [Dr Y].
However, the Tribunal did not accept that this satisfied the test as to ZIJ's capacity to revoke the 2004 enduring power of attorney as, in the Tribunal's view, ZIJ's focus on the "bank access issue" (whereby ZIJ's two children pursuant to the authority given to them under the 2004 enduring power of attorney had changed the online password to a bank account of ZIJ) was the "sole" reason that ZIJ wanted to revoke the power of attorney (at [67] and [77]) and demonstrated her "narrow focus" on this issue (at [77]).
The Tribunal stated (at [64]) that:
For [ZIJ] to be capable of revoking the 2004 power of attorney, she needed to understand that she had given her children enormous power over her estate and the revocation would take that away from them. She needed to understand that as a consequence of the revocation, her children would no longer be able to make any financial decisions at all for her if she lost capacity, including discussions about the different aspects of her estate mentioned above.
The Tribunal gave little weight to the medical reports of Dr Z (4 July 2017) and Dr Y (11 July 2017) which the appellant relied on to demonstrate that the appellant had the requisite capacity. This was because the Tribunal determined that neither of these reports expressed an opinion as to whether ZIJ understood the effect of the revocation of the 2004 enduring power of attorney (at [77]-[78]).
In relation to Mr W's evidence, the Tribunal stated (at [79]):
We also placed little weight on the evidence of [Mr W] about [ZIJ's] capacity to revoke the 2004 power of attorney. [Mr W] was unable to recall any specific details of his conversation with [ZIJ] at the time of revocation. His notes were general in nature and did not address whether [ZIJ] understood that the revocation would end her children's ability to make decisions about every aspect of her estate, not just her bank accounts. His role on the revocation document was only as a witness of [ZIJ's] signature and he was not required to certify her capacity to execute the document.
[14]
Making of new enduring power of attorney on 18 July 2017
As outlined in the decision of Scott v Scott [2012] NSWSC 1541 (at [199]-[201]):
[199] There is no rule of general application relating to all powers of attorney without regard to particular facts. Attention must be focussed on all the circumstances of the case, including the identities of the donor and donee of a disputed power of attorney; their relationship; the terms of the instrument; the nature of the business that might be conducted pursuant to the power; the extent to which the donor might be affected in his or her person or property by an exercise of the power; the circumstances in which the instrument came to be prepared for execution, including any particular purpose for which it may ostensibly have been prepared; and the circumstances in which it was executed.
[200] An exploration of all the circumstances of the case will, not uncommonly, call for consideration of events leading up to, and beyond, the time of execution of the disputed power of attorney, as well as on the focal point of the time of execution itself. A longitudinal assessment of mental capacity, along a time line extending either side of the focal point, may be necessary, or at least permissible, in order to examine the subject's mental capacity in context. Medicos and lawyers, alike, tend to embrace that approach. It is difficult to do otherwise. Context has a temporal as well as spacial and relational dimensions.
[201] Given equity's tender regard for protection of the weak and considerations of conscience, an examination of the question whether a donor had mental capacity to grant a power of attorney will, not uncommonly, also invite a critical inquiry as to whether any element of undue influence may be discernable.
In the Tribunal's consideration of the circumstances surrounding the making of the 2017 enduring power of attorney, the Tribunal largely disregarded the medical evidence submitted by the parties on the basis that there "were no cognitive assessments of ZIJ close to the time she executed the enduring power of attorney" ([93]) and did not accept the appellant's submissions that the medical reports of Dr Z and Dr Y confirmed that ZIJ had the requisite mental capacity to make the new document ([95]).
The Tribunal outlined in some detail why it gave limited weight to Mr W's evidence in relation to the making of the 2017 enduring power of attorney ([35]-[40], [98]-[103] and [122]-[123]). Whilst it accepted Mr W's evidence that he has witnessed many such instruments and was genuine in his belief that ZIJ appeared to understand what she was signing (at [101]), he did not make contemporaneous notes of the appointment and gave evidence that he only made notes about that day two days later on 20 July 2017 when contacted by a solicitor about his meeting with ZIJ [36].
The Tribunal also noted the evidence that Mr W had confirmed in an email to a solicitor acting for ZIJ's son that neither ZIJ nor the appellant had provided him with any medical reports of ZIJ's diagnosis of dementia [35].
Mr W gave evidence about the process he undertook when he executed the documents for ZIJ ([37]-[40]). However, ultimately, the Tribunal placed little weight on the evidence of Mr W in relation to his assessment of ZIJ's capacity because it was satisfied that his certification was based on ZIJ's responses to the standard questions he usually asks of all appointers and had not tested ZIJ's understanding of crucial aspects of the 2017 enduring power of attorney such as the fact that her attorneys could make decisions about any aspect of her estate and could do so without reference to her ([102]). The Tribunal also considered that Mr W's evidence "had limited weight" because he could not recall the specific details of his appointment with ZIJ, noting that "he could give us no evidence about any explanation she may have given in her own words about the effect of appointing joint and several attorneys or the powers they would have to give gifts or confer benefits on themselves" ([103]).
The Tribunal also outlined in detail other aspects of the evidence relating to ZIJ's capacity to understand the powers that she had provided to the attorneys and the decisions they could make without further reference to her (at [104]-[163]).
In this respect, we note one of the appellant's criticisms was that the 2017 enduring power of attorney did not alter, when compared with the 2004 enduring power of attorney, any of the powers granted to the attorneys. As is dealt with, correctly, by the Tribunal (at [151]) the enduring power of attorney signed by ZIJ on 18 July 2017 in fact gave the appellant and ZIJ's brother the authority to give gifts to others and to confer benefits on themselves to meet their own reasonable living and medical expenses. These authorities were not provided to the attorneys under the 2004 instrument.
As noted in Scott v Scott [2012] NSWSC 1541 (at [202]-[205])), the factors relevant to an assessment of mental capacity in relation to the making of an enduring power of attorney that confers on an attorney power to dispose of the principal's property to or for the benefit of the attorney or third parties may be different from those factors relevant to an assessment of mental capacity in relation to the making of an enduring power of attorney limited in its terms, or effect, to authorisation of acts for the benefit solely of the principal.
After considering all of the evidence, the Tribunal concluded that ZIJ lacked the requisite mental capacity to validly execute the 2017 enduring power of attorney. This was because it "…was a complex legal document with significant consequences for the future management of her estate. It was not a 'standard' power of attorney but included provisions about gifts and benefits and appointed two attorneys to act in a particular way." (at [162])
[15]
Discussion
There is no statutory definition of the expression "mental capacity" in the Powers of Attorney Act. However, the concepts of "capacity" and "incapacity" are informed by the general law (Szodza v Szozda [2010] NSWSC 804, [27]-[42]; Scott v Scott [2012] NSWSC 1541, [194]-[241]).
The capacity to execute a document depends on the particular circumstances in which it is executed. As explained in Gibbons v Wright (1954) 91 CLR 423, 437-438 (Dixon CJ, Kitto and Taylor JJ):
The law does not prescribe any fixed standard of sanity as requisite for the validity of all transactions. It requires, in relation to each particular matter or piece of business transacted, that each party shall have such soundness of mind as to be capable of understanding the general nature of what he is doing by his participation.
…
…the mental capacity required by the law in respect of any instrument is relative to the particular transaction which is being effected by means of the instrument, and may be described as the capacity to understand the nature of that transaction when it is explained. As Hodson LJ remarked [in Estate of Park [1954 P89 and 136], "one cannot consider soundness of mind in the air, so to speak, but only in relation to the facts and the subject-matter of the particular case".
In relation to the revocation of the 2004 enduring power of attorney, we again have some sympathy for the appellant's argument concerning the emphasis placed by the Tribunal on the errors contained in the revocation document concerning the date of the revoked instrument and the spelling of ZIJ's daughter's name. Whilst it is a matter of fact and degree in each case, errors such as those that existed in this document may not in and of themselves in every case support a finding of incapacity even in the case of an elderly person with some degree of cognitive decline who is nevertheless able to express a consistent and justifiable view as to who he or she does not want to have as their attorney/s.
The weight to be given to evidence, however, is a question of fact. As Mason J explained in Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1996) 162 CLR 24; [1986] HCA 40 at [40]:
It is generally for the decision-maker and not the court to determine the appropriate weight to be given to the matters which are required to be taken into account in exercising the statutory power.
The appellant was also critical, in particular, about the limited weight afforded by the Tribunal to Mr W's evidence in relation to his actions in witnessing both the revocation and the making of the new enduring power of attorney. Similarly, in our view, this was a question of fact and a matter for the Tribunal.
Having noted this, the Tribunal also relied on other evidence to support its conclusion that ZIJ did not have the mental capacity to revoke the 2004 enduring power of attorney or make the new enduring power of attorney. The appellant has also criticised the Tribunal's analysis as applying too onerous a test of the degree of understanding required in order for a valid revocation to occur and the making of a new, valid enduring power to occur. We have come to the conclusion that in the absence of any statutory definition of "mental capacity" when looked at as a whole, the Tribunal's identification of the factors relevant to a consideration of ZIJ's mental capacity at the time of execution of these documents does not appear to be outside the bounds of the principles outlined in the leading authorities referred to previously.
In all of these circumstances, we do not consider that the finding that ZIJ did not have the mental capacity on 18 July 2017 to revoke the 2004 enduring power of attorney or make the 2017 enduring power of attorney was against the weight of the evidence. This was a difficult matter particularly given the strongly and genuinely held views of the appellant. It was made more complex by the fact that by the time of the hearings on 10 January 2018 and 20 February 2018, ZIJ was unable, as a result of her cognitive decline, to give evidence of her recollection and understanding of documents executed some six months earlier.
We conclude that the Tribunal did not go about the fact finding process in such an unorthodox manner or in such a way that it was likely to produce an unfair result so that it would be in the interests of justice for it to be reviewed. Nor was there any question or principle or policy raised, or manifest error in the decision or decision making process under review, which merits a grant of leave.
This ground of appeal is not established.
[16]
No evidence before the Tribunal that the appointments made by ZIJ on 18 July 2017 were not operating in the best interests of ZIJ (Ground (c))
To the extent that this ground of appeal relates to the review conducted by the Tribunal on 10 January 2018 of the appointment made by ZIJ on 18 July 2017 of the appellant and her brother as her enduring guardians, the Tribunal set out (at [58]-[97]) the evidence it relied on to arrive at the determination that it was in ZIJ's best interests to revoke the appointment of the enduring guardians. In essence, the Tribunal made findings that it was not in ZIJ's best interests for the appellant to continue as an enduring guardian because he would be unlikely to consult ZIJ's children before making decisions or to place any weight on any views they offered ([64]) and that he would not make decisions which appropriately meet ZIJ's high care needs ([65]).
The Tribunal also set out (at [95]-[97]) the basis upon which it determined that the appointment of ZIJ's brother, as her enduring guardian, was not in ZIJ's best interests and should be revoked. In essence, this was because the Tribunal formed the view that ZIJ's brother would not make independent decisions for ZIJ and would not wish to become involved in the conflict between the appellant and ZIJ's children ([97]).
There was nothing put to us by the appellant that led us to the conclusion that the Tribunal went about the fact finding process in respect of these matters in such an unorthodox manner or in such a way that it was likely to produce an unfair result so that it would be in the interests of justice for it to be reviewed. Nor was there any question or principle or policy raised, or manifest error in the decision or decision making process under review, which merits a grant of leave.
Further, to the extent that the appeal ground relates to the enduring power of attorney purportedly made by ZIJ on 18 July 2017, the statutory test applied by the Tribunal in considering whether ZIJ did or did not have the mental capacity to make a valid power of attorney (Powers of Attorney Act, s 36(3)(a)), does not require consideration of whether the appointments are operating in ZIJ's best interests. Accordingly, we see no grounds in this respect that would merit a grant of leave.
This ground of appeal is not established.
[17]
Did the Tribunal fail to have regard to ZIJ's views about who she wished to be appointed as her decision maker/s? (Ground d)
As we understood the appellant's submissions, he asserted that the Tribunal did not adequately take into account ZIJ's often expressed wishes as to who she wished to have assisted her with decision making. ZIJ's views were clearly expressed in the instruments she executed on 18 July 2017, at the hearings and in correspondence with her children.
We understood the appellant, in making this submission, to be making reference to s 4(d) of the Guardianship Act which requires everyone exercising functions under the Act to observe the principle that the views of the subject person (here ZIJ) should be taken into consideration.
The reviews conducted by the Tribunal of the revocation of the 2004 enduring power of attorney and the making of the 2017 enduring power of attorney, were both conducted pursuant to the relevant provisions, s 36(3) and (3A), of the Powers of Attorney Act. The Tribunal is only under a duty to observe the principles set out in s 4 of the Guardianship Act when the Tribunal is exercising its Division functions for the purposes of that Act. The Tribunal below was not required to observe the principles set out in s 4 of the Guardianship Act when exercising its discretion under s 36(3) or (3A) of the Powers of Attorney Act (ZBC v ZBD [2016] NSWCATAP 264, [100]-[101]).
In relation to the hearing conducted on 10 January 2018 and the Tribunal's consideration of the application for a guardianship order, the Tribunal made express reference to ZIJ's views (at [103]-[104] and [118])) as follows:
[103] We considered that [ZIJ's] evidence at the hearing demonstrated she is currently cognitively impaired and needs support to make decisions. Her responses to our questions were often confused, disjointed or unrelated to the topic. She did not recall appointing an enduring guardian.
[104] While [ZIJ] remembered that [the appellant] had been overseas, she did not remember that [the appellant's daughter] or [ZIJ's daughter] had stayed with her in his absence. She could not give us a logical, coherent plan for where she might live when she leaves hospital. She was not sure why she was in hospital.
…
[118] In deciding to make a guardianship order, we did not place any weight on the views of [ZIJ]. We considered she was not able to understand the concept of guardianship based on her presentation at the hearing. [The appellant] did not express a view about whether a guardian should be appointed as he maintained that his appointment as enduring guardian should continue.
In a similar vein the Tribunal made the following observations in relation to the orders made on 22 February 2018 when considering the financial management application:
[170] [ZIJ's] presentation at the two hearing dates of this matter was consistent with her diagnosis. She was unable to respond to any of our questions in a coherent, rational manner. Her responses were often unrelated to the topic being discussed. She did not remember that [the appellant's daughter] had stayed at her home when he was overseas in June 2017. She did not recall making a power of attorney or going to [a regional NSW] Court House.
[171] At the hearing on 20 February, [ZIJ] expressed many fears and anxieties about people who wished to harm her.
These aspects of the Tribunal's reasoning show that the Tribunal sought ZIJ's views but placed no weight on them due to the extent of her cognitive impairment. We see no grounds in this respect that would merit a grant of leave and this ground of appeal is not established.
[18]
Order
1. Leave to appeal is refused.
2. The appeal is dismissed.
[19]
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
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Decision last updated: 29 October 2018