Aak v NSWTG and ABH
[2011] NSWADT 161
•01 July 2011
Administrative Decisions Tribunal
New South Wales
Medium Neutral Citation: AAK v NSWTG and ABH [2011] NSWADT 161 Hearing dates: 3 March 2011 Decision date: 01 July 2011 Jurisdiction: General Division Before: J Millar, Judicial Member Decision: Decision affirmed
Catchwords: Protected Estates - review of NSWTG's decision not to investigate Power of Attorney, not to pursue recovery of monies Legislation Cited: Administrative Decisions Tribunal Act, 1997
Guardianship Act, 1983Cases Cited: Commissioner for Children & Young People v. FZ (2011) NSWCA 11 Category: Principal judgment Parties: AAK (Applicant)
NSW Trustee & Guardian (First Respondent)
ABH (Second Respondent)Representation: AAK (Applicant in person)
NSW Trustee & Guardian (Respondent)
ABH (Respondent in person)
File Number(s): 103316 Publication restriction: S126 of the Administrative Decisions Tribunal Act 1997 applies
REASONS FOR DECISION
GENERAL DIVISION (J MILLAR (JUDICIAL MEMBER)): AAK is the applicant for review a decision by the NSW Trustee & Guardian (NSWTG) to take no further action in regard to further investigation of a power of attorney given by his mother and recovery proceedings against ABH or AAK. The NSWTG and ABH both oppose AAK's application and seek that the decision under review be affirmed.
HISTORY
On 29 July 2009 the Guardianship Tribunal made an order that the estate of AAK's and ABH's mother be subject to management under the provisions of the NSW Trustee & Guardian Act, 2009 and that management of her estate be committed to the NSW Trustee. On the same date the Guardianship Tribunal, on the application of ABH that the Tribunal revoke an enduring power of attorney dated 15 January 2008 which appointed AAK as attorney for their mother, reviewed the making and the operation and effect of the power of attorney and determined not to make any order. On the same date, in respect of an application by AAK requesting the Guardianship Tribunal to revoke an enduring power of attorney dated 11 October 2001 by which ABH was appointed attorney for their mother, the Tribunal reviewed the making an operation and effect of the power of attorney and determined not to make any order in respect of it, and instead in all of the circumstances, treated the application for review as an application for a financial management order pursuant to Part 3A of the Guardianship Act, 1987.
At the time of making those orders the Tribunal found that AAK's and ABH's mother was not capable of managing her financial affairs, that she needed to have a financial manager appointed and that it was in her best interests that such an order be made. Management was committed to the NSW Trustee. An application for appointment of a financial manager made by AAK did not need to be determined in view of the other orders made by the Guardianship Tribunal and accordingly it was dismissed.
At the time of the hearing before the Guardianship Tribunal AAK's and ABH's mother was aged 86 years and was residing in a nursing home at Pendle Hill where she had been located since 2004.
It is evident from the reasons for decision of the Guardianship Tribunal concerning the orders made on 24 July 2009 that the Tribunal was provided with a substantial quantity of evidence by AAK concerning his brother's dealings with their mother's finances over recent years following the execution by their mother of the power of attorney dated 11 October 2001 by which ABH was appointed attorney by their mother.
Following the appointment of the NSW Trustee as financial manager for their mother, AAK provided correspondence to the legal department of the NSW Trustee in which he set out in detail his requirements with regard to having his brother account for his conduct in relation to the dealings in which he had engaged concerning their mother's money.
On 3 May 2010, Ms C Phang of the NSW Trustee decided to take no further action in regard to further investigation of the power of attorney or recovery proceedings from either AAK or ABH.
On 15 November 2010 AAK requested an internal review of the decision made by Ms Phang on 3 May 2010. I note from the s.58 documents provided to the Tribunal that document D17 acknowledges receipt of AAK's letter dated 15 November 2010 seeking an internal review of the decision made on 26 October 2010. It appears that this decision is in similar terms to the decision of Ms Phang of 3 May 2010. 27 October 2010 is the date of the letter written by Ian Irwin, Legal Officer of the NSWTG to both AAK and ABH in which Mr Irwin gives an explanation of the decision made not to undertake further action in the matter. Essentially, it appears the decision was made upon the basis of a cost benefit analysis. Mr Irwin noted that there were funds in the estate of approximately $106,000.00 at the time and a DVA pension being received which gave an operating surplus for the coming 12 months of about $10,000.00. The implication of these statements is that AAK's mother was sufficiently provided for. Mr Irwin urged both AAK and ABH to allow the matter to rest in view of the fact that it was unlikely, in his opinion, to serve any real advantage to their mother.
Upon the internal review of the decision conducted by Ruth Pollard, Acting Assistant Director Legal Services, the decision was made on 2 December 2010 to affirm Ms Phang's original decision that no further action be taken to investigate the power of attorney given in favour of AAK and that no further action be taken in relation to recovery proceedings from either AAK or ABH.
On 14 December 2010, AAK filed an Application for Review of a Reviewable Decision in the Tribunal. On 8 February 2011 ABH applied to be joined to the proceedings in view of the fact that his interests were potentially affected by the proceedings. On 15 February 2011 the Tribunal ordered that ABH be joined as a party to the proceedings.
LAW
There was no issue between the parties that the decision which is the subject of the application for review was a reviewable decision as defined in s.8 of the Administrative Decisions Tribunal Act, 1997. Section 63 of the Act requires that in determining the application for review the Tribunal is to decide what the correct and preferable decision is having regard to the material before it. Such material includes any relevant factual material and any applicable written or unwritten law.
Section 70 of the Act requires that the Tribunal ensure that the parties to proceedings before it are given a reasonable opportunity to present their cases and to make submissions in relation to the issues in the proceedings. This provision of the Act is relevant in this matter in view of AAK's desire expressed at the hearing to cross-examine ABH and Ms Phang.
Section 73 of the Act sets out a number of provisions concerning the procedure to be adopted by the Tribunal. The Tribunal may determine its own procedure, is not bound by the rules of evidence and may enquire into and inform itself on any matter in such manner as it thinks fit subject to the rules of natural justice and is to act with as little formality as the circumstances of the case permit. Among other requirements the Tribunal is to ensure that the parties have the fullest opportunity practicable to be heard or otherwise have their submissions considered in the proceedings.
The issue of a right to cross-examination in the Tribunal was considered in Commissioner for Children & Young People v. FZ (2011) NSWCA 111, Young JA, when considering the issue of cross-examination, referred to Ramsay v. Australian Postal Corporation 147 FCR 39 in which Spender J said at 47:
"While a right to cross-examination is not necessarily to be recognised in every case as an incident of the obligation to accord procedural fairness, the right to challenge by cross-examination a deponent whose evidence is adverse, in important respects, to the case a party wishes to present, is."
With respect to the Administrative Appeals Tribunal it has been held that that Tribunal is "plainly entitled to control the hearing and to limit examination or cross-examination so as to ensure some semblance of relevance to the real issues": Lawrence v. Chief Executive Officer, CRS Australia (2006) 42 AAR 539 at 547; (2006) FCA 341.
AAK's CASE
AAK attended the hearing and appeared on his own behalf. In support of his Application to the Tribunal he provided a 44 page document dated 13 December 2010. This document set out on the first page his requests being that the Tribunal investigate and make a determination on his complaints in relation to the internal review decision dated 3 December 2010, his request for a review of a decision dated 15 November 2010 and the letter from NSWTG dated 26 October 2010. There was attached with his 44 page initial submission documents referred to as item 1, item 2, etc, to item 26. These documents are referred to in his initial submission in support of his Application to the Tribunal.
In addition to these documents, AAK filed an Affidavit with the Tribunal said to be declared and affirmed on 26 February 2011.
The Tribunal also received the documents required to be filed pursuant to s.58 of the Administrative Decisions Tribunal Act, 1997 from the NSWTG which included a letter from AAK to the NSWTG dated 16 November 2009. On 3 February 2011 the Tribunal received a further document from the NSWTG which was a letter titled, "Formal Complaint" from AAK addressed to the Manager, NSW Trustee & Guardian dated 8 March 2010 together with enclosures.
During the course of the hearing, AAK provided further documents to the Tribunal which were titled, "Cross-Examination of Catherine Phang" of NSWTG and, "Cross-Examination of ABH", both dated 3 March 2011.
AAK made oral submissions during the hearing.
At the hearing AAK was taken to each of the complaints referred to in his Affidavit affirmed 26 February 2011. He was invited to make submissions in relation to each of the 19 complaints referred to in that document. In his Affidavit, he indicated that the submissions (consisting of 44 pages together with supporting items of evidence) which accompanied his application to the Tribunal were in support of the 19 complaints set out in his Affidavit. AAK was invited to address each of the matters raised in his Affidavit since they appear to be a summary of the matters referred to in his written submissions and other material filed with the Tribunal.
AAK made the following submissions. He objected to the terminology used by NSWTG where money used by ABH was described as being "borrowed". He also objected to the use of the word "allegedly" before the word "misappropriated". His view is that the moneys in issue were stolen or misappropriated by ABH.
AAK submitted that Ian Irwin of NSWTG is not an auditor or otherwise trained to carry out an audit, the implication being that he was unsuited by reason of lack of qualifications and experience to undertake the task assigned to him within NSWTG.
With respect to complaint No.1, AAK submitted that NSWTG should have obtained copies of the relevant cheques. Upon enquiry of the ANZ Bank he said that he had ascertained that there is no cost incurred with the bank in obtaining copies of the cheques. He said that accordingly, the copies should have been obtained and a competent person should have been assigned the task of conducting the investigation.
With respect to complaint No.2, AAK said that it should not have been said that ABH "accounted for" missing monies. Rather ABH had admitted to spending money for his own benefit, which money belonged to their mother.
With respect to complaint No.3, AAK believes the statement that their mother gave ABH and family two sums of $500.00 was "untrue and inconclusive". AAK believes that ABH simply gave these monies to himself. AAK acknowledged that ABH had refunded to their mother's account the total sum of $55,694.50 which he had taken from her funds and in AAK's opinion it was very likely that the two sums of $500.00 were also "stolen".
Complaint No.4 concerned a sum of $2,400.00 drawn on 16 September 2002. However AAK acknowledged that the expenditure of that sum has since been explained.
With respect to complaints No.5, 6, 7 and 8, AAK submitted that the NSWTG had made a major error in proceeding on the assumption that the ANZ Bank would charge to obtain copies of cheques. He submitted that upon enquiry made by him, as at December 2009, there was no charge for cheque enquiries made by the Bank.
With respect to complaint No.9, AAK objected to the use of the word "alleged" when referring to monies misappropriated since in his opinion the fact of misappropriation is established.
With respect to complaint No.10, AAK drew attention to a statement by the review officer to the effect that Mr Irwin was not able to fully confirm repayment of an amount of $1,200.00 by AAK to his mother's account. AAK submitted strongly that he established by reference to documents set out on page 21 of his submission that he had repaid the sum of $1,200.00. He submitted that he was entitled to be completely exonerated with respect to this matter.
With respect to complaint 11, AAK submitted that the NSWTG had demonstrated actual bias towards ABH who is a retired Magistrate. He argued that this bias was demonstrated by a number of matters, including the NSWTG accepting ABH's excuses for not accounting for further funds removed from their mother's account, the NSWTG not making any cheque enquiries, the NSWTG being unaware that such enquiries would be at no cost and the NSWTG's readiness to accept what ABH says as the truth.
With respect to complaint 12, AAK submitted the officers named on page 23 of his submission, who are all officers of the NSWTG having an association to varying degrees with this case, were incompetent for the task given to them. They all appear to agree with each other and have made "huge errors". He queried what training and qualifications the relevant persons have with regard to auditing financial affairs. In his opinion, their incompetence was demonstrated by their failure to attempt to obtain copies of the cheques, not knowing that this would be free of cost, and one of them, Mr Irwin, admitting that he has "no skills to be performing such a task".
With respect to complaint No.13, AAK argued that the NSWTG should re-open its investigation to establish affirmatively that he used the sum of $2,000.00 of his mother's money for her benefit. He submitted that the funds were used to pay for her exercise and massage therapy. At pages 25 to 33 of his submissions, AAK dealt with this matter in some detail. In essence, he submitted that given the information provided to the NSWTG they should have been able to establish that he did use the sum of $2,000.00 referred to in this complaint for his mother's benefit being for the expenditure indicated.
With respect to complaint 14, this complaint essentially related to a finding made by the Guardianship Tribunal in that it was said that the Guardianship Tribunal found that "ABH had been forthright with the Tribunal". AAK argued that this was inaccurate and he submitted that he had provided ample evidence to disprove this statement.
With respect to complaint No.15, AAK argued that Mr Irwin's statement to the effect that AAK did "no more than made very general accusations of a defalcation in the amount of $100,000.00 and this assertion was not sustainable on the evidence," was incorrect. He set out in his submissions commencing at page 36 an account of the steps he took to establish that his allegations were true concerning the disposition of his mother's money by ABH.
With respect to complaint No.16, AAK argued that the statement in Mr Irwin's submission that Paul Johnson was a witness of credit in the Guardianship Tribunal proceedings was false and should be retracted.
Complaints No.17 and 18 refer to Mr Irwin, to the fact that he is biased, should be removed from the case and that the case should be re-opened and conducted by somebody with suitable qualifications and experience. Apart from earlier submissions concerning bias, further submissions by AAK were contained on pages 39 and 40 of his written submissions concerning these complaints.
With respect to complaint No.19, AAK submitted that he was entitled to be exonerated in relation to the expenditure of $2,000.00 referred to in Mr Irwin's submission where he refers to a cheque that may have been drawn by AAK for $2,000.00 but which was a relatively small amount and hence did not require further action or investigation. AAK told the Tribunal that he had proved this money had been spent for his mother's benefit and accordingly an affirmative finding should have been made exonerating him from any assertion of wrong doing on his part.
NSWTG's case
The NSWTG was represented by Ms C Phang, solicitor, at the hearing.
Ms Phang was the original decision maker concerning the decision not to take further action by way of investigation of the original power of attorney or recovery proceedings following investigation concerning funds taken from the account of AAK's mother. In making her decision she adopted the recommendation of Mr Irwin contained in a submission by him dated 30 April 2010. That document is item D11 of the s.58 documents. The decision of the review officer reviewing the decision made by Ms Phang was made on 2 December 2010. Her reasons for deciding to affirm the original decision of Ms Phang are set out in the Internal Review of Decision dated 2 December 2010, a copy of which was forwarded by letter dated 2 December 2010 to AAK, which letter also advised him of his rights to apply for review of the decision by the Tribunal.
Apart from relying upon the reasons set out in the documents to which reference has just been made, Ms Phang drew attention to the statement in item D19 of the s.58 documents on page 5 of that item where it was indicated that Mr Irwin accepted that AAK had fully repaid the amount of $1,200.00 referred to in complaint No.10 made by AAK.
ABH'S CASE
ABH attended the hearing and appeared on his own behalf. ABH made written submissions to the Tribunal dated 23 February 2010. He also affirmed an Affidavit on 23 February 2011.
ABH indicated that he relied upon his Affidavit and written submissions in support of his case. ABH relied upon material which he had provided to the Guardianship Tribunal and which is contained in the s.58 documents. He indicated in his Affidavit that he had repaid all monies that he had borrowed from his mother. He said in his Affidavit that to pursue enquiries concerning cheques drawn on his mother's account is likely to be an unnecessary and expensive process which would be of no benefit to his mother. In his submissions, he submitted that the only evidence before the Tribunal is that the cheque withdrawals from his mother's account were for her own purposes and to pay her accounts and there was no evidence to the contrary. Accordingly, in his opinion, there was no evidence before the Tribunal to justify overturning the decisions of the NSWTG.
REASONING
Before proceeding to resolve this matter, it is important that the issues for determination be clearly identified. As has been previously noted, in determining an Application for Review of a Reviewable Decision the Tribunal is required to make the correct and preferable decision. The decision under review as identified in the Internal Reviewer's Decision of 2 December 2010 is the decision to take no further action to investigate the power of attorney given in favour of AAK and to take no further action in relation to recovery proceedings from either AAK or ABH. Section 29 of the NSW Trustee & Guardian Act, 2009 provides that persons exercising functions under the relevant provisions of that Act with respect to persons such as AAK's mother have a duty to observe the seven principles there stated. These principles include that the welfare and interests of the person whose affairs are under management should be given paramount consideration.
In my opinion the issue for determination on this Review is whether it is in the best interests of AAK's and ABH's mother for the investigations referred to in the review officer's decision to be pursued. The issue on review is not whether one or more particular sums of money were removed from their mother's account in circumstances which make removal of those funds unlawful, by being taken without consent or in breach of the fiduciary duty which was owed by the attorney under the power of attorney, or was a "borrowing" which must now be repaid or recovery of which should be pursued by an action in debt.
It is significant in this matter to identify the issue and to identify what is not an issue upon the Review. This is so because AAK indicated at the hearing that he wished to cross-examine two people in relation to various subjects. He wished to cross-examine ABH in relation to the misappropriation of particular amounts of money from his mother's account. He also wished to cross-examine Ms Phang in relation to the qualifications of Mr Irwin and other persons who are officers of the NSWTG associated with this case.
AAK provided to the Tribunal at the hearing a document entitled "Cross-Examination of Paul Johnson" of eight pages in length. In this document AAK set out the matters which were to be the subject of the cross-examination. In the case of ABH he provided to the Tribunal an Affidavit affirmed 23 February 2011. Accordingly, this raises at least the possibility of the opportunity for cross-examination being extended to the other parties.
In relation to Ms Phang, AAK provided to the Tribunal during the hearing a document entitled "Cross-Examination of Catherine Phang of NSWTG", being a document of 12 pages in length. This document set out the cross-examination that AAK proposed to undertake of Ms Phang. With regard to Ms Phang it must be remembered that she had not sworn an Affidavit nor did she give any oral evidence in the proceedings. Although she was the original decision maker, she attended the hearing as the legal representative of the NSWTG. AAK cannot cross-examine Ms Phang since she is not a witness in the proceedings.
In any event with respect to the proposed cross-examination of Ms Phang, in my opinion the matters intended to be the subject of cross-examination are really matters of argument or matters about which cross-examination will not assist in the resolution of the relevant issues upon this Review.
In my opinion, it is not appropriate that the review hearing be used to undertake, in whole or in part, the investigation as to the disposition of sums of money from AAK's mother's bank account which would be the subject of investigation if the review officer's decision was set aside.
To return to the reference above to the statements of Spender J in Ramsay , while the evidence of ABH in his Affidavit may be thought to be adverse to AAK's case, in my opinion the evidence really amounts to ABH's assertion that any expenditure of his mother's money on his part was in his mother's interests and all funds which he borrowed have been repaid to her estate. Whether this is so and whether there have been withdrawals which are not explained and which are not established as being for the benefit of AAK's mother is the matter which would be the subject of the investigation if it were to take place. In my opinion, determination of this review is not assisted by cross-examination which would challenge the assertions of ABH in his Affidavit. Cross-examination should be directed to disputes of facts to either correct or contradict evidence given by a witness with a view to establishing the true facts to the extent that is necessary to resolve the issues in the case. In the present case, this matter is to be resolved primarily by argument and submissions.
In resolving the issue which arises upon the Review, it is a matter of considering the respective arguments for and against the undertaking of the relevant investigations. There are several matters which are relevant to this determination.
AAK attached to the document entitled "Formal Complaint" dated 8 March 2010 addressed to the Manager, NSW Trustee & Guardian, a lengthy list of cheques which are said to be "suspect and must be investigated". The cheques are dated from 5 June 2001 to 6 February 2008. The information provided gives the date and number of the cheque, the statement page number, the amount of the cheque and a tally of the total. As I understand it, AAK argues that an even greater amount than the total of $68,030.62 is unaccounted for and should be investigated.
The first of these cheques was written approximately 10 years ago. As at the date of the review officer's decision of 2 December 2010, cheques to a total amount of $44,506.37 had been drawn more than six years previously. Apart from any other reason not to investigate the matter further, if recovery of any of those amounts was sought from the person who received the funds in circumstances where they should not have done so, it is likely that a Limitation Act defence would be available to defeat any action for recovery of the relevant funds.
Given that many of the cheques were drawn more than six years ago, it is likely that there will be difficulties in establishing the facts, even assuming all of the cheques can be made available by the bank at no cost, concerning the expenditure relevant to each cheque and the purpose of the expenditure. Many of the sums referred to are quite small, being less than $100.00 in many instances. The onus of proving that monies are repayable will be on the NSWTG. It is not difficult to imagine significant problems of proof in seeking to recover funds which were taken so many years ago in circumstances where the NSWTG would not have firsthand knowledge of the transactions. Accordingly it would only offer evidence obtained from such enquiries as it could make concerning the matter.
There is also an issue of expense to be considered. As AAK points out several times in his submissions, if an appropriately qualified person is to be employed to undertake the investigation such a person may be an accountant or auditor who will have to be retained and paid at normal professional rates to carry out the work. It cannot be known before the task commences whether such expenditure will prove to be worthwhile. As ABH has repaid all amounts which he says he borrowed from his mother in circumstances where it appears he acknowledges it was imprudent to do so, it may be assumed that it is likely he does not consider himself liable to refund any further funds. That being so, any further recovery from him, if it were to be sought, is likely to be contested. This is likely to lead to legal proceedings which will incur legal costs for the NSWTG which will be payable from the estate under management. If proceedings were to be instituted to recover various amounts of the relevant withdrawals from the bank account of AAK's mother and the proceedings were successful with regard to some amounts and unsuccessful with regard to others (because some were shown to be for the benefit of AAK's mother directly or indirectly or because the matter could not be sufficiently proved), then the NSWTG would not necessarily obtain a costs order to cover the costs of such proceedings. An order may be made that each party pay its own costs given that each party may have won some issues and lost other issues.
In considering whether it is in AAK's mother's best interests to conduct the investigations under consideration, regard should be had to the nature and extent of her estate under management. As at 3 May 2010, according to item D11 of the s.58 documents at page 5, it appears that AAK's mother was appropriately accommodated in a nursing home at Pendle Hill and was in receipt of a DVA pension which was projecting an operating surplus for the year in the vicinity of $10,000.00. There was also an amount of $98,000.00 in trust funds. AAK's mother is presently about 88 years of age. In all of the circumstances it appears that ample provision has been made for all necessary expenses to be met as required and indeed, there appear to be more funds than are required to meet even unexpected contingencies. Therefore, one might ask how does it advance the welfare and interests of AAK's and ABH's mother to conduct the investigation and possible recovery proceedings concerning funds withdrawn from her account in the past. In my opinion, having regard to the age of the relevant transactions, the costs likely to be incurred with respect to accounting services, legal services and costs of the office of the NSWTG in relation to investigation and possible recovery proceedings, and taking into account the nature and extent of the estate under management, it is not in the best interests of AAK's and ABH's mother to pursue the investigations any further.
It is appreciated that AAK holds very strong views concerning the conduct of his brother, ABH, in particular, to the effect that his brother has stolen funds belonging to his mother and misappropriated them for his own use and benefit. However, whether or not that is so is yet to be established. The issue is whether pursuit of an investigation of these allegations is warranted having regard to the best interests of the person whose affairs are under management. In my opinion, the correct and preferable decision in all of the circumstances is that no further action should be taken to investigate the relevant transactions.
In relation to the issue of investigation of the power of attorney, as a financial management order has been made by the Guardianship Tribunal, no purpose would be served by undertaking any investigation of the power of attorney. Again, the correct and preferable decision is to not pursue an investigation of that matter.
CONCLUSION
The Tribunal decided to affirm the decisions under review.
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Decision last updated: 01 July 2011
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