BGMJ
[2014] QCAT 422
•15 August 2014
| CITATION: | BGMJ [2014] QCAT 422 |
| PARTIES: | BGMJ |
| APPLICATION NUMBER: | GAA4773-14 |
| MATTER TYPE: | Guardianship and administration matters for adults |
| HEARING DATE: | 6 August 2014 |
| HEARD AT: | Brisbane |
| DECISION OF: | Member Joachim |
| DELIVERED ON: | 15 August 2014 |
| DELIVERED AT: | Carrara Health Centre |
| ORDERS MADE: | 1. The appointment of The Public Trustee of Queensland as administrator for BGMJ for all financial matters is revoked. 2. The Public Trustee of Queensland is directed to transfer to the attorneys all of the adult’s assets and provide an account of their reasonable expenses to the attorneys for payment by 4pm 5 September 2014. 3. The attorneys for financial matters, BMMJ and BMGG are directed to provide: a. a financial management plan to the Tribunal using the Tribunal form “a financial management plan for appointed administrators.” The plan is to evidence the attorney having received financial planning advice from a licensed financial planner; by 4 pm 6 November 2014. b. copies of the principal’s (BGMJ) bank statements/passport/ term accounts for the past year with appropriately notated entries (6 August 2014 – 5 August 2015); by 4pm 4 September 2015. c. copies of receipts for any individual items purchased in excess of $500.00 for the next year (6 August 2014 – 5 August 2015); by 4pm 4 September 2015. d. for any shares, or investments, a copy of all dividend notices or statements received during the year (6 August 2014 – 5 August 2015); by 4pm 4 September 2015. 4. The attorneys are directed to keep all records, receipts and dealings of transactions involving the principal’s assets, income and expenditure. 5. The attorneys are directed not to make any gifts or loans to anyone using the principal’s assets. 6. The attorneys are directed to pay reasonable expenses of The Public Trustee of Queensland from the funds of the principal. |
| CATCHWORDS: | ADMINISTRATION – ENDURING POWERS OF ATTORNEY – where Adult Guardian conducted investigation – where Public Trustee of Queensland appointed as administrator – where enduring power of attorney overtaken – where Public Trustee of Queensland directed to conduct further investigation – where Public Trustee of Queensland appointment reviewed – where Public Trustee of Queensland investigation still being undertaken – where attorneys acknowledge poor record keeping – where Tribunal has concerns of Public Trustee of Queensland’s action – whether attorneys should be reinstated and supervised Guardianship and Administration Act 2000 (Qld), s 31 |
APPEARANCES and REPRESENTATION (if any):
| APPLICANT: | Attorneys self represented |
| RESPONDENT: | The Public Trustee of Queensland represented by Kylie Retschlag and Stephen Taylor representing the Official Solicitor |
REASONS FOR DECISION
The Tribunal conducted a review of the appointment of the Public Trustee of Queensland (‘Public Trustee’) on 6 August 2014. The Public Trustee was appointed as administrator for BGMJ on 9 August 2013 for a period of 12 months.
At that time a New South Wales enduring power of attorney dated 15 December 2000 appointing BMMJ and BMGG as attorneys for financial matters was overtaken. Directions were given to the Public Trustee at that time.
According to s 34 of the Powers of Attorney Act 1998 (Qld) the New South Wales enduring power of attorney must be treated as if it were an enduring power of attorney made under the Powers of Attorney Act.
The appointment of the Public Trustee on 9 August 2013 was made following a hearing which heard concerns of the Adult Guardian following an investigation by that office of the actions of the attorney.
These concerns related to non-keeping of records, making of gifts and loans to family members, costs of the adult’s living expenses, the use of funds to renovate the adult’s property in New South Wales and numerous unaccounted cash withdrawals.
The review conducted on 6 August 2014 is done so under s 31 of the Guardianship and Administration Act 2000 (Qld). At the end of the review I must revoke the appointment unless I am satisfied that I would make an appointment if a new application were to be made.
The first matter I need to consider is BGMJ’s capacity for decision making.
The evidence before me is that she was unable to make any decisions for herself as a result of progressive vascular dementia and very poor memory. All parties present at the hearing who know BGMJ agreed that she did not have the ability to make decisions about her financial matters.
The next question I need to address is, is there a need to appointment an administrator? There are two possible answers. The answer to that question is yes if the enduring power of attorney appointing the sons is to remain overtaken or is to be revoked. The answer is no if the Public Trustee’s appointment is revoked.
Whether the Public Trustee’s appointment is to be revoked depends on how satisfied I am that the attorneys have addressed questions about their actions and whether I can be satisfied they will undertake their obligations in accordance with the Powers of Attorney Act.
The Public Trustee was requested at the hearing in 2013 to investigate certain actions of the attorneys. The Public Trustee, as a result, has sought explanations from the attorneys regarding the transactions referred to in the Adult Guardian’s report of 5 April 2013.
The Public Trustee advised explanations have been provided for some but not all of the transactions. The investigation is still being undertaken.
The Public Trustee provided to me a detailed schedule of transactions subject to the Public Trustee’s investigation. The Public Trustee raised concerns regarding the non-supply of receipts, whether financial advice had been received during the global financial crisis and about loans to family members.
The Public Trustee was seeking directions from the Tribunal that the attorneys provide to the Public Trustee an explanation and all documents in their possession in relation to transactions listed in Annexure B to their submissions.
Most of the items listed in Annexure B have an explanation given but few receipts or invoices are provided. The attorneys acknowledge their poor record keeping and say they have no more receipts. It seems fruitless to me to make the order requested by the Public Trustee.
Annexure A to the Public Trustee’s report outlines a range of expenses the attorneys say they incurred on their mother’s behalf including travel, telephone calls, dvds, and expenses for treats, magazines and recreation. Whilst there is no documentary evidence supporting their explanations I am satisfied it is more likely than not these costs were incurred.
As to the global financial crisis the attorneys advise that they sought advice from a financial planner at their mother’s bank. They cannot be criticised for riding out the global financial crisis.
The loans to family members are said to be consistent with the principal’s behaviour when she had capacity. She has been very generous indeed purchasing houses for family members. Their error was not securing repayments of loans and relatively poor documentation.
There were multiple withdrawals of $200 used for BGMJ’s incidental spending when she was with family. The attorney’s wife noted these stopped when BGMJ went into care.
I am satisfied that the attorneys assisted their parents over many years with their affairs and they provided care for BGMJ for many years. The attorneys appear to have dealt with the house at Fernvale in BGMJ’s best interests in the face of family disputation.
The attorneys acknowledge they had been ignorant of the rules and failed to keep records. They state there has been no misappropriation of funds, they should be reinstated in accordance with their mother’s wishes and that they have acted in good faith. BMMJ indicated in his written submission how the attorneys would operate if reinstated.
The Public Trustee say that the Public Trustee should stay as administrators as they are competent and more appropriate than the attorneys. I do not need to take into account the appropriateness considerations unless I am satisfied I would make an appointment if a new application were to be made; that is the appointment of an administrator. I am not so satisfied.
BGMJ’s current financial situation is this. She has property in New South Wales worth approximately $675,000 which is rented. She has cash with the Public Trustee in the vicinity of $422,000. She receives rent from her property of $1,100 per fortnight, a DVA pension of $856 per fortnight and interest of approximately $426 per fortnight. Her expenses include chemist account, insurance, her care fees, property management fees, property maintenance and rates. She has a current surplus of $130.48 per fortnight but if the Public Trustee’s fees were removed her surplus would increase by approximately $190 per fortnight.
BGMJ’s financial affairs are relatively straight forward. She has two assets of significance. That is, the house and her cash savings. For the most part her expenses include those associated with the house which are dealt in the main by Elders Real Estate and secondly her nursing home fees.
I accept that the attorneys did not act in accordance with the Act. I am however willing to give them a second chance and will revoke the Public Trustee’s appointment. The attorneys will be required to provide a financial management plan within three months and a range of documents to the Tribunal annually. Their actions will be supervised. They will be directed not to make loans or gifts.
I will read the formal orders of the Tribunal shortly but I would like the Public Trustee to examine four issues of concern that I have.
The first of these is in relation to the statement of advice given by Morgans. I refer to section 3.3 which describes the terms of engagement. In this they say that the investments considered in this plan are restricted to the Public Trustee of Queensland term investment accounts conservative fund, growth fund, higher growth fund and the Australian equities fund. These funds are invested in the pool sector funds managed by Queensland Investment Corporation. Thus the only investments that Morgans can consider are restricted to the Public Trustee funds.
It seems odd to me that an advisor can only recommend the Public Trustee funds. It suggests there are no others suitable. This cannot possibly be so. The Public Trustee should review its restrictions on the advice Morgans can give.
My second concern relates to the liquidation of the investment portfolio of BGMJ. The recommendation was made that the portfolio which she had built up whilst she had capacity should be moved to cash investments on the basis that the portfolio is invested in shares which were high risk.
BGMJ is 90 years old and has a low risk profile according to the advice. Morgans advice was prepared on 25 February 2014 and the bulk of the holdings were liquidated on 6 June 2014.
The Public Trustee should have been aware that their appointment was for one year only and due for review on 9 August 2013. It was possible and indeed it has transpired that the attorneys could be reinstated. The Public Trustee did not give the attorneys the statement of advice from Morgans and request them to comment. It was sent to BGMJ, the point of which escapes me given her incapacity.
The attorneys should have been consulted. They point out that the income projected from the Public Trustee Term Investment Fund will be significantly less than the income from the investments that were liquidated.
My criticism of the Public Trustee is that they did not consult with the attorneys who two months later could have been reinstated. That leads me to my third concern that the Public Trustee submissions were partly based on an assumption that the EPA had already been revoked. That assumption was clearly incorrect. The advice provided in the submissions was wrong in law.
The fourth concern I have with the Public Trustee is that the Public Trustee advised the Tribunal there were no exit fees from the portfolio when it was liquidated. Subsequently it was revealed that there were exit costs of approximately $1,470.
I would like the Public Trustee to examine those four concerns of mine.
The formal orders of the Tribunal are:
1. The appointment of The Public Trustee of Queensland as administrator for BGMJ for all financial matters is revoked.
2. The Public Trustee of Queensland is directed to transfer to the attorneys all of the adult’s assets and provide an account of their reasonable expenses to the attorneys for payment by 4pm 5 September 2014.
3. The attorneys for financial matters, BMMJ and BMGG are directed to provide:
(a)a financial management plan to the Tribunal using the Tribunal form “a financial management plan for appointed administrators.” The plan is to evidence the attorney having received financial planning advice from a licensed financial planner; by 4 pm 6 November 2014.
(b)copies of the principal’s (BGMJ) bank statements/passport/ term accounts for the past year with appropriately notated entries (6 August 2014 – 5 August 2015); by 4pm 4 September 2015.
(c)copies of receipts for any individual items purchased in excess of $500.00 for the next year (6 August 2014 – 5 August 2015); by 4pm 4 September 2015.
(d)for any shares, or investments, a copy of all dividend notices or statements received during the year (6 August 2014 – 5 August 2015); by 4pm 4 September 2015.
4. The attorneys are directed to keep all records, receipts and dealings of transactions involving the principal’s assets, income and expenditure.
5. The attorneys are directed not to make any gifts or loans to anyone using the principal’s assets.
6. The attorneys are directed to pay reasonable expenses of The Public Trustee of Queensland from the funds of the principal.
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