AHB v NSW Trustee and Guardian

[2016] NSWCATAD 208

Civil and Administrative Tribunal

New South Wales

Medium Neutral Citation:	AHB v NSW Trustee and Guardian [2016] NSWCATAD 208
Hearing dates:	22 April 2016
Date of orders:	15 September 2016
Decision date:	15 September 2016
Jurisdiction:	Administrative and Equal Opportunity Division
Before:	R Booby, Senior Member
Decision:	The decision of the NSW Trustee and Guardian made on 3 July 2015 as affirmed at internal review 22 October 2015 is affirmed.
Catchwords:	ADMINISTRATIVE LAW – review of decision of NSW Trustee and Guardian – whether the decision to sell property is correct and preferable decision
Legislation Cited:	Civil and Administrative Tribunal Act 2013 (NSW) NSW Trustee and Guardian Act 2009 (NSW) Administrative Decisions Review Act 1997 (NSW)
Cases Cited:	AHB v NSW Trustee and Guardian [2012] NSWADT 76 AHB v NSW Trustee and Guardian [2012] NSWADTAP 37 AHB v NSW Trustee and Guardian [2014] NSWCA 216 Protective Commissioner v. D & Ors (2004) NSWCA 216
Category:	Principal judgment
Parties:	AHB (Applicant) NSW Trustee and Guardian (Respondent)
Representation:	Solicitors: AHB (Applicant in person) NSW Trustee and Guardian (Respondent in person)
File Number(s):	1610009
Publication restriction:	s.64 Civil and Administrative Tribunal Act 2013 (NSW) – No details identifying the applicant, protected person or witnesses to be published

reasons for decision

introduction

1. The NSW Trustee and Guardian (NSWTG) manages the finances of the protected person pursuant to an order of the (then) Guardianship Tribunal of NSW dated 24 October 2012.

2. Section 65 of the Civil and Administrative Tribunal Act 2013 prohibits, except under certain circumstances the publication of the name of a person to whom proceedings under the Guardianship Act 1987 relate. As the order appointing the NSWTG was made under that Act, the Tribunal made an order under s.64(1) of the Civil and Administrative Tribunal Act prohibiting the disclosure of the name of any person (whether or not a party to proceedings in the Tribunal or a witness summoned by, or appearing before the Tribunal.

background

3. The Applicant, AHB seeks review of a decision of the Respondent, the NSWTG, to sell the property belonging to the protected person located in Sydney, NSW.

4. AHB sought internal review of the decision to sell the property and that review upheld the decision. AHB is now seeking the administrative review of the decision to sell the property.

5. AHB has standing to bring this application because he is a person whose interests are adversely affected by the Trustee’s decision (s 62(1) of the NSW Trustee and Guardian Act 2009 (NSW) (the Trustee Act)).

6. AHB has previously sought review of decisions regarding the management of the estate of the protected person.

1. In the matter of AHB v NSW Trustee and Guardian [2012] NSWADTAP 37 the Appeal Panel of the Administrative Decisions Tribunal dismissed the appeal and affirmed the decision of the Tribunal below (AHB v NSW Trustee and Guardian [2012] NSWADT 76) which affirmed the the decision of the NSWTG to sell the home.

2. In the matter of AHB v NSW Trustee and Guardian [2014] NSWCA 216 the Court of Appeal considered an appeal by AHB against a decision of the Administrative Decisions Tribunal and dismissed the appeal.

The DECISION THE SUBJECT OF REVIEW

The Original Decision of the NSWTG

7. An electronic file note of an officer of the NSWTG dated 3 July 2015 refers to a comprehensive account of the reasons for the proposal and approves the decision to sell the property. The reasons for that decision are summarised and include:

1. The protected person has been resident in an aged care facility since 30 November 2009. The applicant provided care for her in the subject property for approximately three years and the property would be assessable for aged care facility fees.

2. AHB was in adverse occupation of the property and was not contributing rent or payment towards council and water rates or insurance. As a result the protected person was not obtaining a benefit from the property. There was also a suggestion that AHB had sublet a room and any rent obtained had not been recovered from AHB.

3. The protected person was unable to express a view about the property. The other stakeholders, being her other two children, were in support of the proposed sale.

4. The Assets Branch of the NSWTG was in favour of the sale as the protected person was not receiving benefit from the property.

5. The budget of the protected person had serious depletion issues that would further impact on future budgets due to non-payment of charges such as rates.

8. In a letter to the NSWTG dated 1 September 2015 AHB proposed that the property be leased rather than sold. He supports his proposal with statements to the following effect:

1. The protected person opposes the sale of the house and also opposes a proposal that a reverse mortgage be taken out on the property.

2. One reason that the protected person opposes the sale of the house is that AHB would be left homeless due to a back injury that renders him unable to work fulltime.

3. AHB is not able to undertake to pay the full market rent and would not object to other tenants being named on a lease.

4. AHB has undertaken some maintenance work on the house to make it attractive to potential tenants.

5. The previous rental income has been expended in the care of the protected person’s dog.

9. In a document dated 22 October 2015 an Assistant Director, Legal Services at the NSWTG affirmed the decision to sell the property. The Assistant Director reviewed all documentation on the file of the NSWTG including the proposal of AHB to sublet the property. Her decision to affirm the decision includes comments to the following effect:

1. The sale of the property would provide certainty of outcome and would secure the future interests of the protected person.

2. Subletting two rooms of the property would have difficulties and there is a risk in relying on rental income to pay for essential needs such as accommodation, care and living expenses.

3. The fact that the proposed rental is for two rooms only in a house otherwise occupied increases the risk of vacancies and the uncertainty of rental returns.

4. There are practical difficulties in the proposal. The NSWTG is the manager of the protected person’s estate and could not delegate to AHB the management of a lease. If AHB and other tenants were all on a lease there would be a problem if for ay reason AHB vacated leaving other tenants who would be responsible for payment of the full rental amount.

5. AHB has stated that he expended previous rental income on caring for the protected person’s dog. However he has lived in the property without paying rent since 2009 and has received the benefit of the rent-free occupation.

the views of ahb

10. AHB submitted a Statement of Issues with supporting documentation. He contends that:

1. In his view the proposed sale is in pursuance of the best interests of the NSWTG and not that of the protected person.

2. At paragraph 43 of the decision in the matter of AHB v NSW Trustee and Guardian (supra) the Court advised that that a reverse mortgage provided a means of ensuring the protected person’s financial security whilst retaining the home.

3. The comment by the decision maker in the electronic file notes dated 3 July 2015 that all stakeholders support the sale is incorrect because the protected person has expressed a view that the house should not be sold.

4. The comment by the decision maker in the electronic file notes dated 3 July 2015 that AHB has had not contributed to the property is incorrect and fails to take account of the work that AHB has done on the property.

5. A report of a clinical psychologist dated 30 August 2012 indicates that the protected person was able to participate in decision-making.

6. The value of the property has increased over time and hence, by retaining the property, the protected person’s estate has benefitted and would benefit further into the future if retained for longer.

7. Whilst it might be difficult to achieve the proposed $500-$600 rental in a share house situation, a lesser rental amount, such as $300 per week would eliminate the protected person’s budge shortfall.

8. An alternative rental proposal is renting the home excluding the bedroom used by AHB and an outside toilet that would be for the use of AHB and the laundry that would be for joint use.

9. The protected person has no need of the large sum that would be provided by the sale of the house.

10. A reverse mortgage would provide for security of outcome regarding the protected person’s estate. AHB undertakes to make all interest payments on such a loan.

11. The NSWTG has provided two different forecast budget deficits for the protected person in the 2015/2916 year, one being $8773 and the other being $15,599. AHB’s calculations suggest a deficit of $7248. This is not a sufficient deficit to warrant the sale of the house

11. AHB provided the Tribunal with a document dated 5 December 2009 signed in the name of the protected person stating that she wanted him to have “full use” of her house, and a document dated 3 November 2014 signed in the name of the protected person stating that she did not want her house sold and wanted it kept for her family and herself.

12. AHB provides his assessment of the situation if the house were sold compared to it being retained.

1. In his assessment, if the house were retained and a reverse mortgage obtained, he would pay the interest on the reverse mortgage. As a result of appreciation in the value of the house, the protected person’s assets at the end of 4 years would be $1,214,850.

2. If the house were sold, allowing for a 3% return on the invested proceeds and deducting the NSWTG fees, the protected person’s assets would $1,059,515.

13. In a letter to the NSWTG dated 19 April 2016, AHB offers to:

1. Deposit $1000 every two weeks into the account of the protected person on the proviso that the NSWTG ceases action to evict him from the home of the protected person.

2. Vacate the property if he fails to make the deposit in fewer than 48 weeks per year whilst the protected person is alive.

3. Vacate the property if the protected person’s need for income exceeded her available funds so long as all the money raised was spent solely on the protected person.

14. In a letter dated 18 April 2016 addressed “To Whom it May Concern” a friend of AHB states that he has known AHB since 1978 and has shared houses with him and there has never been a problem with him paying rent or expenses.

The views of the NSWTG

15. In a document headed “Response to Statement of Issues” Ms Stormont comments to the following effect:

1. When contacted in 2012 the protected person said that she did not want the property mortgaged to pay a Refundable Accommodation Deposit if that would result in interest charges. A file note dated 7 February 2012 by Ms Stormont is to that effect.

2. The protected person now lacks the capacity to provide a view on the sale of the property. The Tribunal notes that according to a file note, on 12 April 2016 Ms Stormont contacted the aged care facility and spoke to the Assistant Care Manager who said that the protected person did not have the capacity to understand decisions regarding the sale of her property and that she is not able to leave the facility.

3. In her will the protected person states that the property should be sold on her death, thus indicating that a sale would be required to provide for her children.

4. In the matter of AHB v NSW Trustee and Guardian 2014 (supra) the Court notes that a mortgage over the property was an “obvious alternative” to the sale of the property, but does not direct the NSWTG to take out a mortgage.

5. Analysis by the Financial Planning Unit of the NSWTG is to the effect that a mortgage is not in the best interests of the protected person.

6. Despite the claims of AHB to have maintained the property, a Sales and Leasing Report dated 7 April 2016 describes the property as being in a “very poor and dilapidated condition”.

7. Whilst the value of the property is increasing, the benefit of that increase in value is only realised if the property is sold. Hence the NSWTG remains of the view that the protected person is receiving no financial benefit from the property.

16. The NSWTG provides an analysis of the protected person’s financial situation. Provided by the Financial Planning Unit. The analysis is dated 12 April 2014 and assumes a life expectancy of 4 years for the protected person. The analysis indicates the following:

1. Assets and Liabilities

1. Total Assets:               $1,332,211

2. Liabilities: Council and Water rates:   $1,784

2. Estimated ongoing income and expenses

Income: $41,533 comprising:

• Centrelink Pension:            $4,470

• State Super Pension:         $26,742

• Dust Diseases Board:         $10,321

Expenses: $58,366, comprising:

• Accommodation:            $34,044

• Comforts:               $650

• Health insurance:            $2,052

• Pharmaceutical:            $500

• Discretionary:            $1,000

• Property Costs:            $5,000

• NSWTG management fee:      $15,000

• NSWTG Account keeping fee:      $120

Shortfall (before Trust account interest)    = $16,832

Shortfall (before Trust account interest and assuming repayment of loan by daughter)                = $13,332

3. Centrelink Pension: The two-year exemption of the property from the assets assessment has ended and the protected person is paying an accommodation charge at the aged care facility. The property is assessable and the protected person is therefore not entitled to a Centrelink pension because her assets exceed the threshold and her income will be reduced accordingly. So far, Centrelink have not ceased the pension and a debt to Centrelink is owed and is accruing.

4. With respect to a reverse mortgage line of credit loan there is no known provider of a reverse mortgage when the borrower does not live in the property.

1. A NSWTG file note dated 3 March 2016 is to the following effect:

1. An arrangement suggested in a letter AHB dated 21 February 2016 (and similar to that provided by AHB in his submissions) is not a “reverse mortgage” but a line of credit for a fixed term of four years. It is not clarified whether the interest rate of 6.5% fixed or variable. The loan is repayable on maturity so it offers no solution other than to accumulate debt or result in a mortgagee sale if the repayments were not kept up.

2. The proposal amounts to an offer by AHB to pay interest of $21 per week whilst the protected person would forgo market rental.

3. Accordingly the proposal is considered to the detriment of the protected person.

4. The version of the Line of Credit provided by AHB In his submissions assumes a fixed interest rate but the website of the provider states that only a variable interest rate was on offer at that time.

5. AHB’s calculation contained in his submissions assumes a drawdown of $7,800pa. However on current estimates the shortfall is higher, at approximately $16,800

5. Regarding AHB’s assessment of the situation if the house were retained:

1. The assumption that AHB would pay the interest on the line of credit each month is not guaranteed.

2. AHB predicts that the real estate will appreciate in value between 4% and 10%. However the actual change in value of real estate is not known. The value of the property might increase, or decrease or remain unchanged. Data available for the past 4 years in the area of the property is that the changes have been 25% in 2015, 10.7% in 2014, 9.1% in 2013 and -1.8% in 2012.

3. AHB’s calculations have not taken into account the cost of the proposed loan.

6. Regarding AHB’s assessment of the situation if the house were sold:

1. A $16,000 sale commission fee to the NSWTG has been wrongly included and does not apply in this situation,

2. Costs of sale including commission and fees have not been deducted.

3. A 3% return on investment of the sale proceeds is incorrect. The funds would be held in a fund that in 2015 paid 2.18% pa.

4. The assessment double counts the NSWTG management fee

5. The sale of the house would render the protected person ineligible for a Centrelink pension however she would no longer incur property costs.

7. The advice of the unit is that whether the protected person would be financially better off at the end of four years or her lifetime, by selling or retaining the property is primarily dependent on the change in the value of the property. Selling the property will result in certainty that her expenses will be funded and preservation of capital with a risk free cash rate of return. Retention of the property would result in additional risk being taken for unknown reward. The Financial Planning Unit supports the sale of the property.

Oral Submissions

17. In his oral submissions AHB submitted that:

1. The preferred outcome was to manage the property to provide funds to meet the needs of the protected person whilst implementing her wish that the house not be sold.

2. The NSWTG had not made proper endeavours to locate a lender who would provide a reverse mortgage to a person who is not resident in the property.

3. The reasons provided by the NSWTG for not approving a subleasing arrangement are unsubstantiated.

4. The protected person would want her children to benefit from the increased value of the house if it were retained and this would amount to a benefit for her.

18. In her oral submissions, Ms Stormont submitted that:

1. All options proposed had been evaluated by the NSWTG and the best option was to sell the house.

2. AHB has provided no evidence that he is able to pay the $1000 per fortnight as offered in his letter of 19 April 2016. He previously said that he was not able pay rent of $500 per week. To make the payments he would need to sublet the property and the NSWTG has set out the legal concerns about him subletting the property for which it is responsible.

3. The reference provided by a friend with whom AHB has shared house provides no details about AHB’s financial circumstances to show that he is able to afford the proposed payments.

4. AHB previously collected rent by sub-letting the property but did not pay that rent to the estate of the protected person even though he knew that she had financial difficulties

5. The view of the NSWTG is that the correct and preferable decision is that the house be sold to provide guaranteed income and to prevent the protected person’s affairs falling further behind.

19. The Tribunal notes that at the hearing there was considerable discussion about the differences between a reverse mortgage and the line of credit proposed by AHB. Ms Stormont submitted that the advice of the NSWTG Financial Planning Unit was that the scheme proposed by AHB required repayment at the end of its term of four years whereas a reverse mortgage is paid out on the death of the homeowner. AHB said that his enquires had revealed that the loan could be extended if the homeowner was alive at the end of its term.

CONSIDERATION

20. In determining an application for review, s.63 of the Administrative Decisions Tribunal Act provides that the Tribunal is to decide what is the correct and preferable decision having regard to the material before it. In determining whether the decision to sell the family home is the “correct and preferable” decision, the Tribunal must have regard to the material before it, including any relevant factual material and applicable written or unwritten law (s 63(1) of the Administrative Decisions Review Act 1997 (NSW)). When undertaking this task the Tribunal may exercise all of the functions that are vested in the Trustee (s 63(2) of the Administrative Decisions Review Act). The Tribunal may affirm, vary, or set aside the Trustee’s decision. If the decision is set aside, the Tribunal may substitute its own decision for that of the Trustee, or remit the matter to the Trustee together with any directions or recommendations (s 63(3) of the Administrative Decisions Review Act).

21. The NSWTG is required to take into consideration s39 of the NSW Trustee and Guardian Act 2009 which requires everyone exercising functions under this Chapter with respect to protected persons or patients to observe the following principles:

1. The welfare and interests of such persons should be given paramount consideration.

2. The freedom of decision and freedom of action of such persons should be restricted as little as possible.

3. Such persons should be encouraged, as far as possible, to live a normal life in the community.

4. The views of such persons in relation to the exercise of those functions should be taken into consideration,

5. The importance of preserving the family relationships and the cultural and linguistic environments of such persons should be recognised,

6. Such persons should be encouraged, as far as possible, to be self-reliant in matters relating to their personal, domestic and financial affairs.

7. Such persons should be protected from neglect, abuse and exploitation.

22. Chapter 4 of the NSW Trustee and Guardian Act 2009 is concerned with 'management functions relating to persons incapable of managing their affairs.' By s.56(a) the Trustee may exercise all the functions necessary and incidental to management and care of the estate of the managed person.

23. There is in force an order from the (then) Guardianship Tribunal committing the management of the protected person's estate to the Trustee. In managing that estate the Trustee may exercise any of the powers vested in it by s.16. Relevantly, these include powers to:

1. Receive money, rent, income and profit of real and personal property,

2. Grant leases of property for a term not exceeding 10 years and give to a lessee an option of renewal if the aggregate duration of the lease and any such renewal does not exceed 10 years,

3. Surrender a lease and accept a new lease,

4. Buy, sell, realise and mortgage real and personal property,

5. Pay rates, taxes, assessments, insurance premiums, debts, obligations, costs and expenses and other outgoings,

6. Repair and insure against fire or accident any property,

24. In considering the decision under review, it is important to recognise the position of a manager of the estate of a protected person when making decisions in the course of the management of the estate. In Protective Commissioner v. D & Ors (2004) NSWCA 216 McColl JA (Mason P and Giles JA agreeing) said at 173 that:

"The manager stands in the shoes of a person who is unable to manage his/her affairs by virtue of circumstance beyond his/her control. The manager exercises a protective and benevolent function, protective in the sense that the manager's task is to ensure the estate is managed in a manner to secure the protected person's estate for the person's continued maintenance. In this respect the 1983 Act and its predecessors reflected the 'parental and protective' jurisdiction historically exercised by the Crown both in exercise of his prerogative and pursuant to the Prerogative Statutes."

25. The Trustee argues that the protected person’s interests will be best served by the sale of the family home because this provides guaranteed income to make up the shortfall between her income and expenses and leaves sufficient funds to pay recurrent and any additional expenses.

26. AHB disagrees. He contends that the protected person will benefit financially from the retention of the home because it will appreciate in value to an extent that outweighs the gains to be made by investing the sale proceeds. In calculating the gains to be made by retaining the house AHB has assumed that he would pay the interest on a line of credit required to fund the protected person’s budget deficits.

27. AHB also submits that the protected person is opposed to the sale and has expressed a wish for him to remain in the house. If the sale proceeds he will be forced to relocate.

28. AHB has also proposed an alternative funding arrangement under which the house, or parts thereof, would be let or sublet, or a reverse mortgage obtained.

29. In a letter dated 19 April 2016 AHB also offered to pay $1000 per fortnight in return for being permitted to remain in the house.

30. The protected person currently receives no income from her principal asset, the family home. The financial accounts submitted by the NSWTG dated 12 April 2016 indicate that her cash reserve in the NSWTG Trust Fund was $3,949 and her estimated annual expenditure exceeds her annual income by more than $16,000 assuming no repayments are made on a loan to her daughter, and more than $13,000 if loan repayments are made.

31. The Trustee estimates that the protected person’s position will deteriorate further when Centrelink pensions cease because the family home is no longer an “exempt asset” and when Centrelink seeks to recoup pension amounts paid in error. In short, the protected person is currently unable to fund budgeted expenditure and over time the gap between her budgeted income and expenditure will progressively increase. Notably, the unchallenged assumptions made by the Trustee to estimate the protected person’s expenditure contain little excess. A modest amount, less than $40 per fortnight, has been allocated to pay for clothing and $25 per fortnight for “comforts”.

32. The parties agree that the current situation is unsustainable. The difference between them lies in which of the available options should be adopted. Six have been proposed. They are, in summary:

1. Selling the family home (Option 1);

2. Renting the home excluding the bedroom used by AHB and an outside toilet which would be for the use of AHB and the laundry which would be for joint use (Option 2);

3. AHB subletting the home to two other tenants (Option 3);

4. NSWTG agreeing to AHB remaining as tenant with two other tenants all of whom are on the lease (Option 4);

5. Obtaining a reverse mortgage or line of credit to fund any shortfall in the budget of the protected person, with AHB paying the interest on the loan (Option 5);

6. AHB remaining in the home and paying $1000 per fortnight (Option 6).

33. I do not consider Option 6 as viable as I am not persuaded that AHB will be in a position to pay $1000 per fortnight to remain in the house for the following reasons:

1. He provides no evidence that he has the financial resources to make these payments and the undertaking is at odds with his statement in a letter to the NSWTG dated 1 September 2015 in which he states that he is unable to work full time and is not able to pay market rent for the house.

2. The reference provided by a friend of AHB does not indicate that the referee has any knowledge of AHB’s financial situation or employment prospects.

3. In a letter to the NSWTG dated 1 September 2015 AHB said that he had retained the use of $1500 obtained through subletting the premises because he had used his money on caring for the protected person’s dog. This does not sit well with an assertion of being able to pay $1000 per fortnight to remain in the house.

34. I do not consider the rental options in options 2, 3, and 4 to be viable for the following reasons:

1. A Residential Marketing Appraisal dated 7 April 2016 describes the building as a “fibro cottage in very poor and dilapidated condition”.

2. Whilst there is no estimate of the cost of making the property fit for rental to attract tenants, I am mindful of the very limited sum of cash reserves held on behalf of the protected person and believe that such work would require resources greater than those currently available to the protected person.

3. I am of the view that the option of renting the house with the exception of a bedroom and toilet with the shared laundry may not be practicable. In his description of that option AHB does not indicate what he would use as a bathroom. There was no evidence from a real estate agent about the practicability of such an arrangement or of whether or not such an arrangement might result in difficulties in keeping the premises tenanted. In the absence of further evidence I am of the view that this proposal is speculative only.

4. I accept that the NSWTG is unwilling to delegate management responsibilities to AHB such that he could sublet to other tenants.

5. I am of the view that there would be practical problems and uncertainty in letting the house to AHB and two other tenants because if any one of them vacated the rent would fall into arrears.

35. In respect of option 5:

1. I am satisfied with the explanation of the NSWTG that the line of credit option proposed by AHB is not the same as a reverse mortgage in that the former is repayable at the expiry of the loan term and the latter after the death of the mortgagor. Whilst AHB said that he had been told that the loan could be renewed on its expiry I was not provided with evidence to support that proposition.

2. In his Statement of Issues, AHB refers to AHB v NSWTG 2014 (supra) and states that “(t)heir Honour’s advice … in paragraph 43 of their judgment has not been heeded …”, and that “(t)he remedy advised by their Honours, that a reverse mortgage line of credit loan, technically called a cash reserve loan, is the correct and preferable course …”. I am not satisfied that this is the substance of what was said by the Court of Appeal.

1. The comment occurs in paragraph 43 of the judgment and is in relation to the claim for costs, not the substantive matter.

2. At paragraph 43 of the judgment, Meagher, JA comments on the argument of counsel for the respondent that the reason for deciding to sell the house was that “liabilities exceed income”. His Honour comments that:

“…the annual deficit was not shown to be such as would require the sale of the protected person’s home. An obvious alternative which permitted the house to be retained was to fund any annual shortfall by borrowings secured by a mortgage over the property. Furthermore, it is clear from the reasons set out above that the mere existence of that annual shortfall was not the basis on which the decision under review was justified …”

3. As I read this comment His Honour was proposing that a mortgage was one potential option, not necessarily the preferred option, and that he acknowledged that the subject decision was made for reasons additional to the budget deficit.

3. I accept the evidence of the NSWTG that it was not able to source a provider of a reverse mortgage where the borrower is not also the occupier of the house.

4. I accept the view put by the NSWTG that there are risks associated with a loan of credit, including the risk of defaulting on the interest payments, which would jeopardise the loan and could threaten title to the property. There is also a risk that the loan would not be renewed at the expiry of its term.

5. I am of the view that the risks associated with a mortgage are real and that that course of action would only be preferred if it brought substantial advantages. AHB contends that an advantage of making up the budget shortfall using a line of credit or a reverse mortgage, as opposed to selling the house, is that it allows the house to be retained whilst it appreciates in value thus providing for gains that possibly outweigh the cost of the loan. However this scenario relies on favourable movements in property prices and interest rates.

6. Retaining the house as it appreciates in value is only of benefit to the protected person if the house is sold in her lifetime so that she obtains the benefit of the increased sale price. Otherwise the benefit of increased value is enjoyed by her beneficiaries.

7. Whilst I consider it appropriate to take into account the interests of the protected person other than her financial interests, it is my view that her interest in augmenting her beneficiaries’ inheritances is not to be preferred over her interest in ensuring her own financial viability and comfort whilst she is alive.

36. In making the correct and preferable decision, I must give paramount consideration to the welfare and interests of the protected person (s 39(a) of the Trustee Act). There is nothing to suggest, from the ordinary meaning of the words “welfare” and “interests”, their context, or the purpose for which the Trustee Act was enacted, that they should be given a narrow meaning and construed to mean financial welfare and interests. I accept that I must have regard to her interests and welfare at large, and that I must take into account her views.

37. While the effect of the decision under review on the protected person’s financial position is not the sole factor to be taken into account, it is nonetheless relevant to the assessment of her interests and welfare. Her financial position will have a direct bearing on her ability to meet the costs of ongoing care and to fund unbudgeted medical expenses and purchase discretionary goods and services. While it is not possible to predict with any degree of certainty what the protected person’s future health needs will be, a prudent approach demands that she have adequate funds available to fund any future costs.

38. I accept that the protected person has indicated that she does not wish the home to be sold. However she also indicated that she did not want it be used as security for a loan to pay any Refundable Accommodation Deposit. She has not expressed a view about it being used as security for a reverse mortgage or line of credit, or whether or not she would want tenants living it. Whilst I take her views into account, and acknowledge that a psychologist in 2012 expressed the view that she should be included in decision making, I accept the view of the assistant care manager at her aged care facility that nowadays the protected person lacks the capacity to understand issues regarding the sale of her property. It is my view that it is not possible to establish her current view as to which of the six options she would choose given her current circumstances.

39. The task of making the correct and preferable decision requires an evaluation of the relative merits of the alternative options having regard to the principles listed in s 39 of the Trustee Act and any other relevant considerations. Given the protected person’s, impaired decision-making capacity and inability to resume a “normal life in the community“, the s 39 principles regarding best interests and protection from neglect, abuse and exploitation of are of particular relevance.

40. The concept of “best interests” is invariably difficult to apply because reasonable minds may differ as to what course may be in a person’s best interests.

41. Taking all of these matters into account, it is my opinion that the interests of the protected person will be best served by the sale of the family home which provides the most certain means to achieving sufficient funds to meet her budget shortfall and allow her to enjoy her assets for the remaining period of her life. It is therefore my view that the correct and preferable decision is that the house of the protected person should be sold.

42. For these reasons I have decided to affirm the decision made on 3 July 2015 as affirmed at internal review 22 October 2015.

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

Decision last updated: 15 September 2016