ZKN [2021] NSWCATGD 34

ZKN [2021] NSWCATGD 34 - NSWCATGD 2021 case summary — Zoe

[3]

THE LEGAL FRAMEWORK AND THE ORDERS THAT THE TRIBUNAL CAN MAKE

The Tribunal's jurisdiction in relation to the review of the making of powers of attorney is set out in Div 4 of Pt 5 of the POA Act.
The Tribunal may, on the application of a person with standing, decide to review the making, revocation, operation or effect of a reviewable power of attorney: POA Act, s 36(1).
When reviewing the making of a power of attorney, the Tribunal may make an order declaring that the principal either did or did not have the mental capacity to make a valid power of attorney at the relevant time. If the Tribunal is satisfied the principal did not have the capacity necessary to make the power of attorney, the Tribunal may declare the power of attorney to be invalid. The Tribunal may also make an order that the power of attorney is invalid for some other reason, such as where the principal was induced to make the power of attorney by dishonesty or undue influence.
When reviewing the operation and effect of a power of attorney, the Tribunal may make orders but only if it is satisfied that it would be in the best interests of the principal or to do so would better reflect the wishes of the principal. The available orders include removing the person from office as an attorney, appoint a substitute attorney, revoking all or part of the power of attorney or any other orders the Tribunal thinks appropriate.
In the alternative, the Tribunal may decide not to make any orders in respect of the review and, in that event, may treat the application as an application for a financial management order under Pt 3A of the Guardianship Act "if it considers it appropriate in all the circumstances to do so": POA Act, s 37(1). This may be appropriate if there are concerns about the making of a power of attorney but to revoke the instrument would leave the principal without necessary assistance in managing their finances.
The Tribunal's jurisdiction in relation to the review of an enduring guardianship appointment is set out in ss 6J to 6MA of the Guardianship Act.
The Tribunal must on the application of a person with standing, review the appointment of an enduring guardian. On reviewing the appointment, the Tribunal may revoke the appointment or confirm the appointment, with or without varying the functions of the guardian: Guardianship Act, s 6K(1). The Tribunal must not revoke the appointment unless the enduring guardian requested the revocation, or it is satisfied that it is in the best interests of the appointor that the appointment be revoked: Guardianship Act, s 6K(2).
The Tribunal may also proceed, if it considers it is in the best interests of the appointor to do so, deal with the review as if an application for guardianship, financial management or both had been made: Guardianship Act, s 6K(3).

[9]

The Law Society Guidelines - "Questions for preparing an Enduring Power of Attorney"

The Law Society have published guidelines on questions for solicitors who are preparing an enduring power of attorney for a client. The guidelines on capacity include the following statements: "Did you see the client alone? To minimise the risk of undue influence it is preferable to see the client alone. If another person is present make a file note of the person's name and relationship to the client and the reason for their presence… Did you explain the effect of the power of attorney? This is required for the certificate for the purposes of section 19 of the Powers of Attorney Act 2003. In particular, the client should understand: 1.That the document is only effective while the client is alive and has no effect after their death; 2.That they can revoke (cancel) the power at any stage, as long as they have mental capacity; 3.That the power that they are giving another person (the attorney) will extend after the client has lost the mental capacity to revoke (cancel) the enduring document; 4.That they must appoint the attorney of their own free will and without any undue influence on the part of a third party; 5. That they are giving power to another person to manage their financial affairs, and this power includes things like: a) buying and selling property on their behalf (including their own home); b) depositing and withdrawing money from their account/s; and c) buying and selling shares with their money. Did the client appear to understand the effect of the power of attorney? This is required for the section 19 certificate. If you are not satisfied as to the client's understanding, consider obtaining a medical opinion, and do not give the certificate [Footnote removed for publication.]. It is recommended that you ask open-ended questions (examples include: Why do you want to appoint someone as your attorney? Tell me about your family and friends. Who do you want to appoint as your attorney/s and why are you choosing them? What sort of decisions will your attorney be able to make?) and record the questions and the client's answers in a file note. It is recommended that you discuss with your client the importance of choosing an attorney who is trustworthy and responsible, and discuss the extent of the proposed attorney's qualifications for the role, either because of their prior knowledge and involvement in the client's affairs or by reason of having appropriate skills and experience."

[12]

The views of Mr Z, Solicitor

Mr Z prepared and witnessed the execution of the instruments appointing KAQ as ZKN's enduring guardian and attorney. He provided the Certificate under s 19 of the POA Act. He told us that he was first instructed by ZKN in 2015 when he prepared documentation for ZKN and her husband, now deceased. He agreed that he had been previously instructed by ZKN in relation to the instruments of enduring guardianship and enduring powers of attorney on 13 June 2020 and again on 25 October 2020.
In relation to the appointments on 25 June 2021, Mr Z stated that he had received separate telephone calls from both KAQ and ZKN requesting that KAQ be appointed ZKN's enduring guardian and enduring power of attorney. He then attended the public hospital on the 25 June 2021 to obtain ZKN's instructions. In relation to this meeting he gave the following evidence: 1. He met with ZKN in her hospital room. He was accompanied by his wife, Ms X; 2. He was not aware of any formal diagnosis of dementia or any issues giving rise to ZKN not having capacity to give him instructions. He was aware that she was in hospital due to due injuries caused by her burning herself at home. Whilst at the hospital, he did not make any enquires of the medical team treating and caring for ZKN as to whether she may have a medical condition impacting on her capacity to understand the documentation he wished to discuss with her; 3. he did not take any notes of the meeting with ZKN. All his evidence was therefore based on his memory and recall; 4. in response to our questions as to how he satisfied himself that ZKN had capacity to instruct him, he stated that he mainly relied on his past dealings with her and her understanding of the process. Her instructions were also consistent with her previous instructions when he had prepared similar documentation; 5. he stated he was aware of the Law Society guidelines on assessing a client's capacity. We asked him whether he put to ZKN the specific questions referred to in the guidelines regarding ZKN's understanding of the effect of an enduring power of attorney and whether he asked open ended questions. He stated that he believed he did but he agreed that he could not verify this as he did not taken notes; and 6. he agreed that having heard the evidence of Dr Y, ZKN's capacity was an issue. He also agreed that had he been aware of her diagnosis, he would have been "more assiduous" in his meeting with ZKN.

[16]

Is ZKN incapable of managing her affairs?

The test of capability has been clearly set out by Lindsay J in P v NSW Trustee and Guardian [2015] NSWSC 579: "Is a person reasonably able to manage his or her own affairs in a reasonably competent fashion, without the need for 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, in a reasonable, rational and orderly way, with due regard to his or her 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" to manage his or her financial affairs in a reasonably competent manner, 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]. No one at the hearing disputed the validity of the power of attorney.

We refer to and rely on the evidence from Dr Y outlined above.
Ms V, Occupational Therapist from the public hospital prepared a report dated 20 July 2021. Ms V carried out a full assessment on ZKN at the public, hospital on 27 May 2021 to consider her functional capacity and cognition to facilitate discharge planning. Ms V detailed in report the findings following her assessment. Given ZKN's deficits, Ms V concluded that ZKN is likely to display a reduced level of insight, problem solving, judgement, memory and orientation. She is likely to require support to manage complex tasks and manage decision making. Ms V supported the appointment of a guardian and financial manager.
We refer to and rely on the evidence of ZKN outlined above. In our view, ZKN's presentation was consistent with the medical evidence. That is, she had no recall or minimal recall of recent events such as meetings with her solicitor and the signing of documents. She struggled to recall names of family members. We also considered a previous incident last year when ZKN was the subject of financial exploitation by an appointed power of attorney. This incident highlights her vulnerability to be taken advantage of by unscrupulous persons in the future.

[20]

The views of KAQ

KAQ spoke by telephone during the hearing. Unfortunately, the telephone connection was weak and on several occasions during the hearing, the line dropped out or KAQ's words dropped out causing him to call back. At other times, his voice became faint and difficult to comprehend.
KAQ told us that he was a seafarer and was currently working as an officer on a ship which was presently sailing around the waters of Croatia. This would explain the poor quality of the telephone connection. He stated that he was very close to his grandmother and spoke to her regularly by telephone. He believed his grandmother has always wanted to appoint him as her guardian and attorney but did not because she believed he was not available due to being overseas and having his own family responsibilities.
In early June 2021, KAQ found out that his grandmother was in hospital and attempted on several occasions to speak to the treating medical team about her condition and treatment but no person made themselves available apart from the social worker, Ms T. During one telephone call with his grandmother, she indicated she did not wish to move to regional NSW and asked KAQ to become her decision maker. He had a subsequent telephone call with Mr Z who arranged the paperwork and spoke to his grandmother. KAQ then consulted with a London legal practitioner to accept the appointments as enduring guardian and enduring power of attorney.
KAQ was only advised of his grandmother's dementia following his appointment as attorney. However, he was aware of her declining health and was concerned about her particularly in relation to her being financially exploited.
KAQ wished to be appointed his grandmother's financial manager. He understands he does not live in Australia but he stated the real issue is "connectivity". He is available 24/7 to communicate by mobile or email. He can sign documents and have them returned by email or other social apps. In relation to his grandmother's estate, he has been in contact with her banks and is seeking information regarding the current balance and any other investments. He has recently arranged for a maintenance person to attend his grandmother's property and arrange for the lawn to be mowed. If his grandmother needs to be placed in an aged care facility, he could liaise with the management and ensure the fees were paid and placement secured. He was also agreeable to providing regular reports to the NSW Trustee and Guardian and seek guidance from them as required.

[27]

Is ZKN a person for whom the Tribunal could make an order because she has a disability which makes her totally or partially incapable of managing her person?

Section 14 of the Guardianship Act provides that a guardianship order may be made for a person if the Tribunal 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": Guardianship 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: Guardianship Act, s 3(2).
The term "social habilitation" is not defined by the Act. In P v NSW Trustee and Guardian [2015] NSWSC 579, Lindsay J considered the meaning in the context of s 3(2) of the Guardianship Act, at [303]; "The expression 'social habilitation' (in the context of references to 'disability', 'restricted', 'major life activities', and the word 'requires') may be taken to refer to a need for services to help a person to be, or become, able to function normally in community with others."
We refer to and rely on the evidence of Dr Y, Geriatric Specialist as outlined above. In his report, Dr Y also referred to several issues identified during ZKN's current admission being: "Unwitnessed fall, hot water burn, moderate Alzheimer's dementia further complicated by Sundowning Syndrome and nocturnal agitation, behaviour and psychological symptoms of dementia (BPSD) managed with regular Sertraline, Mirtazapine and Risperidone, multifactorial delirium (now resolved), recurrent urinary tract infections, constipation, essential tremors, poor insight, lives alone and refuses to accept services."
We refer to and rely on the evidence of Ms V, Occupational Therapist as outlined above.
While ZKN expressed a view that she could make her own decisions, we preferred the consistent and unequivocal medical evidence regarding her medical conditions and decision-making capacity. As stated, ZKN's overall presentation and interaction with us during the hearing was also consistent with the medical evidence. Based on all the evidence, we were satisfied that ZKN has a disability that prevents her from making important life decisions. She is a person in need of a guardian and for whom we could make a guardianship order.

[28]

Should the Tribunal make a guardianship order and if so, what decision making functions should be included in the order?

Section 14 of the Guardianship Act sets out the following as matters that the Tribunal must have regard to when considering whether to make a guardianship order:

the views of the person, the spouse and the person who has the care of the person;
the importance of preserving existing family relationships;
the importance of preserving cultural and linguistic environments; and
the practicality of services being provided to the person without the need for making a guardianship order.

We must also observe the general principles set out in s 4 of the Guardianship Act. These include that:

the welfare and interests of the person with disabilities should be given paramount consideration and the person's views taken into account;
the freedom of decision and freedom of action of such persons should be restricted as little as possible;
such persons should be encouraged to live a normal life in the community and to be self-reliant in their personal, domestic and financial affairs;
the importance of preserving the family relationships and the cultural and linguistic environments of such persons should be recognised; and
the importance of protecting the person from abuse, neglect and exploitation.

Ms S, Social worker indicated that ZKN was ready for discharge but due to concerns about her returning home, her discharge destination had not been decided. There had been some previous discussion with SZN about ZKN moving to a respite placement at an aged care facility in regional NSW but ZKN was opposed to going to regional NSW. ZKN had also refused to discuss discharge options other than returning home.
Ms V noted in her report that ZKN lives alone in her acreage property. Due to her poor mobility, she requires a wheelchair but has had multiple previous falls at home. ZKN has stated that she had difficulty with activities of daily living and had trouble maintaining her home. She has approval for a level 4 home care package but has previously declined all services. She has been adamant that she does not require support to maintain her living at home.
The hospital treating team including Ms S supported a guardianship order being made to facilitate ZKN's discharge home with adequate and appropriate services or if this is not possible, transfer to a suitable aged care facility.
Apart from ZKN, all persons who participated in the hearing supported the making of a guardianship order.

[30]

Who should be the guardian?

Section 17 of the Guardianship Act states: 1. A person shall not be appointed as the guardian of a person under guardianship unless the Tribunal is satisfied that: 1. the personality of the proposed guardian is generally compatible with that of the person under guardianship; 2. there is no undue conflict between the interests (particularly, the financial interests) of the proposed guardian and those of the person under guardianship; and 3. the proposed guardian is both willing and able to exercise the functions conferred or imposed by the proposed guardianship order.
We are not able to appoint the Public Guardian as a person's guardian if there is a private person who can properly be appointed.
KAQ requested he be appointed. He referred to his submissions outlined above regarding his availability at all times of the day and night by phone, email and other multi-media sources. We raised our concerns with KAQ about his distance from his grandmother, his busy work and family schedule and regarding his 24/7 access, the fact that his call had dropped out on several occasions during the hearing. We also pointed out the types of decisions to be made by a guardian, unlike financial matters, were often requiring immediate attention and often concerning the subject person's safety, welfare and well-being. These included decisions about accommodation, the services received and medical treatment. These decisions often involved multi-layered and complex processes requiring a guardian to liaise quickly with multiple parties including the subject person. We asked KAQ how he would meet these obligations to make these difficult and complex decisions in the best interests of his grandmother. KAQ was unable to provide any further information or insights that gave us confidence he could fulfil the role, particularly in relation to ZKN who will be unlikely to agree to services and any accommodation proposals put forward that do not involve her returning home. Therefore, while KAQ was willing, he was in our view, unable to meet all the demands and obligations of a guardian and for these reasons, we appointed the Public Guardian there being no other suitable person proposed.

At a glance

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Judgment (32 paragraphs)

Legislation Cited (5)

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