M McCalman, General Member
File Number(s): 2018/00290113
Source
Original judgment source is linked above.
Catchwords
C M Kennedy, Senior MemberM McCalman, General Member
File Number(s): 2018/00290113
Judgment (11 paragraphs)
[1]
Introduction
This is an appeal under s 80(2) of the Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act) from a decision of the Guardianship Division of the Tribunal made on 16 October 2018 in which the Tribunal made a financial management order appointing the NSW Trustee and Guardian to manage the estate of ZKX.
We have concluded that the appeal should be allowed and that the financial management order made on 16 October 2018 should be varied to appoint the appellant, ZKY, as the financial manager for her sister, ZKX, with such order of appointment to be reviewed within one year.
[2]
Decision under Appeal
ZKX, aged 56, lives in supported accommodation. She has one sister, ZKY, who has provided informal assistance to her since their mother became unable to care for ZKX. Their mother died on 16 September 2015. ZKX has diagnoses of Down Syndrome and intellectual disability. She does not communicate verbally, and her hearing is significantly impaired.
ZKY v ZKX [2019] NSWCATAP 83 | Case summary | Zoe
On 21 September 2018, the Tribunal received an application from ZKY seeking to be appointed as ZKX's guardian and financial manager.
On 16 October 2018, the Tribunal dismissed the application by ZKY to be appointed as ZKX's guardian, because it was not satisfied that a guardianship order should be made as ZKX's needs were being well managed on an informal basis and a guardianship order was therefore not required. The Tribunal did, however, make a financial management order for the estate of ZKX to be managed by the NSW Trustee and Guardian.
The Tribunal was satisfied that there was a need for a financial management order, and that it was in ZKX's best interests that one be made. However, the Tribunal found ZKY was not a suitable person to manage her sister's affairs, on the basis that there would be a conflict of interest given the sisters' respective positions in relation to their mother's will. Consequently, the NSW Trustee and Guardian was appointed financial manager for ZKX's estate.
On 15 November 2018, the Tribunal received an application from ZKY requesting that the Tribunal's orders of 16 October 2018 be set aside under cl 9 of the Civil and Administrative Tribunal Regulation 2013 (NSW). The Tribunal dismissed the application on 17 December 2018 on the basis that not all parties actively consented to the application.
On 8 January 2019, ZKY lodged a notice of appeal. Initially ZKY appealed both orders made by the Tribunal on 16 October 2018, however, at the hearing of the appeal, withdrew her appeal in respect of the guardianship application. Our decision is therefore only concerned with her appeal against the financial management order and, in particular, the appointment of the NSW Trustee and Guardian as the financial manager of ZKX's estate.
The NSW Trustee and Guardian did not appear or make submissions in relation to the appeal. ZKX also did not appear at the appeal hearing. We accepted the available evidence that ZKX is unable to communicate verbally, would not be able to understand the proceedings of the Tribunal and would be unable to express a view on the proceedings. We therefore determined it was appropriate to proceed with the appeal in her absence.
[3]
Scope and nature of appeals
Internal appeals may be made as of right on a question of law, and otherwise with leave of the Appeal Panel: s 80(2) NCAT Act.
In Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69, the Appeal Panel identified at [13] the following as 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 had been applied;
4. whether there was a failure to afford procedural fairness;
5. whether the Tribunal failed to take into account relevant (that is, mandatory) considerations;
6. whether the Tribunal took into account an irrelevant consideration;
7. whether there was no evidence to support a finding of fact; and
8. whether the decision is so unreasonable that no reasonable decision-maker would make it.
In Collins v Urban [2014] NSWCATAP 17, the Appeal Panel stated at [84] that ordinarily it is appropriate to grant leave to appeal only in matters that involve:
1. issues of principle;
2. questions of public importance or matters of administration or policy which might have general application; or
3. 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;
4. a factual error that was unreasonably arrived at and clearly mistaken; or
5. 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.
[4]
Grounds of appeal
It is appropriate for the Appeal Panel to consider the grounds of appeal in the context that the appellant is self-represented, and therefore, it may have been difficult for her to clearly articulate those grounds and distinguish between questions of law and errors of fact in relation to which leave to appeal is required.
In Cominos v Di Rico [2016] NSWCATAP 5, the Appeal Panel stated at [13]:
[13] It may be difficult for self-represented appellants to clearly express their grounds of appeal. In such circumstances and having regard to the guiding principle, it is appropriate for the Appeal Panel to review an appellant's stated grounds of appeal, the material provided, and the decision of the Tribunal at first instance to examine whether it is possible to discern grounds that may either raise a question of law or a basis for leave to appeal. The Appeal Panel has taken such an approach in a number of cases, for instance, Khan v Kang [2014] NSWCATAP 48 and Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69. However, this must be balanced against the obligation to act fairly and impartially (Bauskis v Liew [2013] NSWCA 297 at [68] citing Hamod v State of New South Wales [2011] NSWCA 367 at [309]-[316]). Relevantly, s 38(2) provides that that Tribunal 'may inquire into and inform itself on any matter in such manner as it thinks fit, subject to the rules of natural justice.'
Based on the grounds of appeal stated by ZKY in her notice of appeal and submissions and as explained by her at the hearing, we have identified the following as possible grounds of appeal:
1. a failure to afford procedural fairness to the appellant in relation to the issue of whether there would be a conflict of interest if she was to be appointed financial manager; and
2. the making of a factual error that was unreasonably arrived at and clearly mistaken concerning ZKX's needs.
The first involves a question of law, while the second requires leave of the Appeal Panel.
[5]
Was the appellant afforded procedural fairness?
Part of the factual background which led the Tribunal to conclude that the NSW Trustee and Guardian, and not the appellant, should be appointed as financial manager, concerned the will of the appellant's and ZKX's mother. Oral evidence was given at the hearing before the Tribunal by the appellant about the terms of her mother's will.
That evidence was to the effect that the appellant is executor of the estate which is yet to be finalised; that the appellant's three children were the main beneficiaries and inherited a property owned by her mother which has now been sold; that ZKX was left a legacy of $5000 and that the balance of the estate (which appeared to be some $50,000 less certain tax liabilities) was left to the appellant.
During the course of the hearing, the appellant offered to provide a copy of her mother's will and was asked by the presiding member to forward it to the relevant case officer in the Guardianship Division. The evidence of the appellant is that she sent a copy of her mother's will to the Tribunal on 19 October 2018. We note that the orders were made on 16 October 2018 and issued on 17 October 2018.
In its reasons for decision, the Tribunal stated at [35]:
"In the Tribunal's view, it is possible that [ZKX] may have a claim for further provision from the Will under the Succession Act, 2006, given that, from an estate of approximately $583,387.22 she has been left only $5,000 on trust, with the balance being left to [ZKY] and her children."
After concluding that there was a need to appoint someone to manage ZKX's affairs, including an investigation of any possible further entitlements she may have under her late mother's will, the Tribunal went on to consider who should be appointed financial manager. ZKY had requested to be appointed as financial manager for ZKX but the Tribunal found that she would not be suitable as she would have a conflict of interest in acting as her sister's financial manager. At [49], the Tribunal identified the source of the conflict as the need to consider whether any application should be made for further provision for ZKX from her mother's will and the fact that ZKY and her children had received most of her mother's estate.
Procedural fairness requires that a party to proceedings be afforded the opportunity to be heard on matters in which their interests are affected. This is reflected in s 38 of the NCAT Act. The evidence of the appellant, confirmed by the record of the hearing, is that at no time during the hearing was the matter of a possible application by ZKX to the Supreme Court for further provision under her mother's will raised with the appellant. The appellant was also not asked to comment on whether, as a result, she may have a conflict of interest in being appointed as her sister's financial manager.
It follows that the appellant was not afforded procedural fairness in relation to the question of whether she was a suitable person to be appointed ZKX's financial manager.
On this ground, the appeal is allowed.
While our conclusion in relation to the procedural fairness ground is sufficient to dispose of the appeal, for reasons which will become apparent, we have gone on to consider the other ground raised by the appellant.
[6]
Error of fact
We therefore now turn to whether the Tribunal made a factual error that was unreasonably arrived at and clearly mistaken.
In its reasons for decision at [38] to [43], the Tribunal referred to a report by an Occupational Therapist dated 30 January 2018 and a National Disability Insurance Scheme (NDIS) Provider Support Plan dated 29 May 2018 along with certain oral evidence given at the hearing by ZKY. Based on its interpretation of this evidence, the Tribunal found that ZKX has ongoing needs which will require the expenditure of further private or personal funds. It was this conclusion which prompted the Tribunal's concerns about whether ZKX may need to seek further provision under her mother's will.
The appellant submits that the Tribunal made an error in its finding that ZKX will require further funding as it fundamentally misunderstood the reports of both the Occupational Therapist and the NDIS Provider Support Plan. The appellant told us that the report by the Occupational Therapist was for the purpose of identifying supports for ZKX that are already covered by the NDIS. Certain possible future needs were mentioned in the report, but this was for the purpose of identifying them as services or equipment which may be incorporated into ZKX's NDIS plan as required, and not to identify any presently unfunded need.
The appellant submitted that all the services her sister requires are met by the NDIS and her pension covers her rent, food, etc., and that, as her sister's condition changes, additional supports will be funded by the NDIS. She also explained that the comment in the NDIS Provider Support Plan that certain funding "was limited" and the provider was "unable to complete the work" in developing a behaviour response plan for ZKX was due to the way NDIS funding is structured and did not indicate that her sister's ongoing needs would not be addressed by the NDIS.
The position put to us by the appellant, which is again supported by the record of the hearing, is that no questions were asked and no evidence was given that funding for supports, including hearing aids or dentures as mentioned in [42] of the Tribunal's decision, or for any future aged care needs would require ZKX's personal funds over and above her pension.
In our view, the Tribunal's failure to ask relevant questions and raise issues concerning the funding of ZKX's future needs through the NDIS or otherwise, led it to make a factual error in its conclusions that ZKX has significant unmet current and future needs. That error was unreasonably arrived at and clearly mistaken. This error contributed to a significant degree to the Tribunal's conclusion that the appellant is not a suitable person to be appointed ZKX's financial manager.
We therefore consider that leave to appeal on this ground should be given and the appeal allowed.
[7]
Who should be appointed as financial manager?
The Appeal Panel has power to vary the decision under appeal pursuant to s 81 of the NCAT Act. In these circumstances, where the appeal was not contested, and related only to the question of who should be appointed as financial manager of ZKX, we determined that it was appropriate for us to vary the decision related to that question for the reasons given below.
In appointing a financial manager, as in making all other orders under the Guardianship Act 1987 (NSW), the Tribunal (including, as in this case, the Appeal Panel) 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 Guardianship Act.
Section 25M of the Guardianship 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 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 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 NSW Trustee and Guardian is the manifest independence of the statutory office, the advantages of a dispassionate and neutral approach in situations of family conflict, expertise and experience in managing estates, an excellent reputation and the security provided to an estate against loss or damage.
The advantages of the appointment of a family member are freedom from fees, 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 her or his quality of life, and particular qualities or qualifications enabling family members to act as managers.
In Holt & Anor, 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 preclude the 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" which the Tribunal should consider when determining who to appoint as a financial manager are discussed by Lindsay J in M v M [2013] NSWSC 1495 at [50], including the recognition that it is a fiduciary role, and the Tribunal must therefore:
"…[B]e alive to the importance of avoiding, or at least minimising, exposure of a protected person to dangers associated with a manager having a conflict between a duty owed to the protected person and the manager's personal interests."
[8]
Is ZKY a suitable person?
In order to appoint ZKY as ZKX's financial manager, we must be satisfied according to the above considerations that she is a suitable person for the role, including among other factors, consideration of ZKY's competencies in financial management generally, as well as any potential conflicts which may arise.
The Tribunal below expressed no doubt in ZKY's qualifications or competencies for the role. She has worked in the finance area, in bookkeeping, as well as in property development, and has paid accounts professionally.
There is further evidence, including letters from ZKX's NDIS Support Coordinator, and the Acting Team Leader of ZKX's current supported accommodation, to the effect that ZKY is a competent and attentive informal support person, and performed well in that role up to the time the NSW Trustee and Guardian was appointed.
The evidence before us indicated that ZKY has maintained a close and continuing relation with her sister and that she has been her primary familial supporter since the death of their mother. ZKY has also managed ZKX's financial affairs informally since 2010 during which time savings of approximately $30,000 have been accumulated.
We accept the evidence as to the abilities of ZKY and her relationship with her sister ZKX and find that ZKY has the general competencies of a financial manager.
[9]
Does a conflict arise and, if so, does it preclude the appellant from being a suitable person?
The question of a conflict of interest arises on the facts of this case due to the parties' respective entitlements or potential claims under the will of their late mother. Details of the will are set out above.
We note that the will makes provision for ZKX's well-being beyond financial distributions, for example, leaving ZKY with the responsibility for ZKX's overall care and protection. In this regard, the will states ZKY is to "[R]egard the best interest of [ZKX] as the paramount consideration…".
We are mindful of the comments made by the Court of Appeal in Abrahams (by his litigation guardian The Public Trustee of Queensland) v Abrahams [2015] QCA 286 at [26] to [28] concerning relevant human rights principles and a person with a disability's right to respect for the person's human worth and dignity. Those comments, in particular, emphasise the importance of the person being encouraged and supported to achieve his or her maximum, physical, social, emotional and intellectual potential and becoming as self-reliant as possible.
These matters may require extra financial assistance over and above that presently available to ZKX. It is therefore accepted by the Appeal Panel that it may be appropriate for ZKX, or an authorised person on her behalf, to seek independent legal advice as to any claims or entitlements in relation to financial distributions under her mother's will.
In the event ZKY is appointed ZKX's financial manager, there may be potential for an apparent conflict of interest between her responsibilities as executor and beneficiary and her responsibilities to ZKX as financial manager. This includes consideration of potential legal action on ZKX's behalf in relation to her entitlements under the will.
Nevertheless, we are satisfied that the conflict is more apparent than real. That is, that the estate, income and capital assets of ZKX will be utilised to advance the interests and quality of life of ZKX, rather than to eventually increase the assets of ZKY.
We are satisfied that the apparent conflict will not interfere with ZKY's consideration of ZKX's need to seek independent legal advice in relation to her entitlements or claims regarding the will. Through her engagement with the Tribunal as a result of her original applications, ZKY is now very much alive to the consideration that needs to be given as to whether ZKX has a claim against their mother's estate and has been informed that it would be prudent for any manager appointed to manage ZKY's estate to seek advice as to whether any action should be taken on behalf of ZKY in relation to the estate prior to the estate being finalised.
ZKY has been the only informal support for her sister, ZKX, for several years. The evidence of ZKY provided in person at the hearing of the appeal, and further evidence given to the Tribunal is that ZKY has competently performed her informal role, including acting on professional advice where needed.
The evidence supports a finding that ZKY continually acts according to ZKX's best interests and to enhance ZKX's quality of life whenever she is required to make a decision which affects ZKX.
We accept this evidence and find that any conflict of interest apparently arising would not diminish ZKY's ability to properly perform the role of financial manager for ZKX, and further, that ZKY is a suitable person to be appointed financial manager for ZKX.
In varying the orders made by the Tribunal on 16 October 2018 we have also decided, as permitted by s 25N(1) of the Guardianship Act, that the Tribunal should review the financial management order within one year.
Having focussed on the facts of this particular case we are satisfied that the balance of considerations leads us to conclude that ZKY should be appointed to manage her sister's estate. However, we are mindful that we must give paramount consideration to the welfare and interests of ZKX in determining who should manage her estate. In circumstances whereby distribution of an estate is yet to be finalised for which there is the potential of conflict between the interests of ZKY and ZKX, it is appropriate that the Tribunal have the opportunity to review the financial management order, and therefore the actions of ZKY in managing her sister's affairs, in a year's time. No doubt at that review the Tribunal will be specifically interested in examining the actions taken by ZKY in seeking advice as to what actions, if any, should be taken on behalf of ZKX, in relation to her entitlements under their mother's will.
[10]
Orders
The orders we make are:
1. Leave is granted to appeal in respect of the order of the Tribunal made on 16 October 2018 which committed the management of the estate of ZKX to the NSW Trustee and Guardian.
2. The Appeal is allowed in respect of the order of the Tribunal made on 16 October 2018 which committed the management of the estate of ZKX to the NSW Trustee and Guardian.
3. The order made by the Tribunal on 16 October 2018 which subjected the estate of ZKX to management under the NSW Trustee and Guardian Act 2009 (NSW) is varied to provide that ZKY is appointed to the role of financial manager for ZKX and that such order be reviewed by the Tribunal within one year of the date of these orders.
[11]
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: 10 April 2019
Parties
Applicant/Plaintiff:
ZKY
Respondent/Defendant:
ZKX
Legislation Cited (4)
Trustee and Guardian Act 2009(NSW)
Civil and Administrative Tribunal Regulation 2013(NSW)