BP v PM & Ors - [2022] QSC 268

SUPREME COURT OF QUEENSLAND

CITATION:

BP v PM & Ors [2022] QSC 268

PARTIES:
REDACTED

FILE NO/S:

263 of 2022

DIVISION:

Trial

PROCEEDING:

Application

ORIGINATING COURT:
Supreme Court of Queensland at Cairns

DELIVERED ON:

2 December 2022

DELIVERED AT:

Cairns

HEARING DATE:

21 November 2022

JUDGE:

Henry J

ORDER:

1. Pursuant to s 118(2) Powers of Attorney Act 1998 (Qld) the Applicant, in her capacity as enduring attorney of and for Victoria is authorised:

(a)     to sell land located at 196 Powley Road, Barrine in far north Queensland more particularly described as Lot 11 on SP 300464 on behalf of Victoria                , in the exercise of the Applicant’s power as enduring attorney of and for Victoria .              .             , to the Fourth Respondent and the Fourth Respondent’s wife, Kate                , as joint purchasers, upon the terms and conditions set out in the written contract, exhibit BP13 to the affidavit of the Applicant filed herewith, and to do all things necessary for or incidental to the effectuation of the said sale, subject to:

(i)      the price being the valuation ascribed to the property by Trevor Gard in an updated market valuation to be procured from him by the Applicant;

(ii)     the amendment of the contract’s Annexure A Special Condition 4 by deleting the word “later” and inserting the word “earlier”.

2.    The Applicant’s costs of and incidental to this application be paid out of the assets of Victoria               .  (including the nett proceeds of the said sale) on the indemnity basis.

3.    I will hear the First and Second Respondents as to what, if any, order should be made as to their costs at 9.15 am 7 December 2022 (out of town parties having leave to appear by telephone), unless the Applicant in her capacity as enduring attorney of and for Victoria               .            reaches agreement with the First and Second Respondents about their costs in the meantime.

4.    Liberty to apply on the giving of two business days notice in writing.

CATCHWORDS:

HEALTH LAW – GUARDIANSHIP, MANAGEMENT AND ADMINISTRATION OF PROPERTY OF PERSONS WITH IMPAIRED CAPACITY – ADMINISTRATION AND FINANCIAL MANAGEMENT – where the applicant is the attorney for financial and personal/health matters of the adult, her mother – where the adult is in permanent residential care at a care facility – where the adult does not have capacity to make decisions about personal health and finances – where the adult owns a small cattle property which is being maintained by the applicant and three of her siblings and its only income is from renting of one of the houses on the property – where the applicant seeks approval from the court to sell the property to her brother at market value – where the transaction is a ‘conflict transaction’ – where the court may approve a ‘conflict transaction’ if satisfied it would be in accordance with the general principles of the Power of Attorney Act 1998 – where two of the respondents, who are siblings of the applicant, oppose the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading BP v PM & Ors

Details

AGLC: BP v PM [2022] QSC 268
Case: [2022] QSC 268
Decision Date: 2 December 2022

CaseChat Overview and Summary

The case of BP v PM & Ors involves a dispute where BP, the applicant, acts as the enduring attorney for her mother, Victoria, who lacks capacity to manage her personal health and finances. Victoria owns a small cattle property which is maintained by BP and her three siblings, with income derived from renting one of the houses on the property. BP seeks court approval to sell the property to her brother, the fourth respondent, at market value. Two of Victoria's other siblings, Patricia and Michael, oppose the transaction on various grounds, including that the sale is at an undervalue, lacks evidence of Victoria’s incapacity in financial matters, is contrary to Victoria’s wishes, and is not in her best interests.

The legal issues before the court were whether the proposed sale accords with the general principles as stipulated by the Powers of Attorney Act 1998 and whether the court should exercise its discretion to authorise the applicant to undertake the transaction. The court had to determine if the sale of the property is in accordance with the general principles outlined in the Act and if it is in Victoria’s best interests. The court's decision-making process involves assessing the transaction against the ten guiding statutory principles under section 6C of the Act, considering the interests of the principal, and exercising its discretion to authorise the transaction if it finds the transaction aligns with these principles.

The court found that the transaction accords with the general principles, as the sale would provide financial benefits to Victoria, who is unable to manage her affairs due to her incapacity. The court considered the fiduciary duty of the attorney to protect the principal's interests, as well as the potential for the transaction to be in the best interests of Victoria. The court was satisfied that the proposed sale would be advantageous to Victoria, and thus authorised the transaction under section 118(2) of the Powers of Attorney Act 1998. The court also ordered that the sale should proceed with specific conditions, including the price being based on a market valuation and an amendment to a special condition in the contract.

In summary, the court authorised BP to sell the property to her brother at market value, subject to certain conditions. BP's costs were to be paid from Victoria's assets, and the court reserved the right to make further orders regarding the costs of the respondents. This decision ensures that the transaction is carried out in the best interests of Victoria, while also addressing the concerns of the opposing siblings.

Orders

Orders of the court

1. Pursuant to s 118(2) Powers of Attorney Act 1998 (Qld) the Applicant, in her capacity as enduring attorney of and for Victoria is authorised:

(a) to sell land located at 196 Powley Road, Barrine in far north Queensland more particularly described as Lot 11 on SP 300464 on behalf of Victoria , in the exercise of the Applicant’s power as enduring attorney of and for Victoria . . , to the Fourth Respondent and the Fourth Respondent’s wife, Kate , as joint purchasers, upon the terms and conditions set out in the written contract, exhibit BP13 to the affidavit of the Applicant filed herewith, and to do all things necessary for or incidental to the effectuation of the said sale, subject to:

(i) the price being the valuation ascribed to the property by Trevor Gard in an updated market valuation to be procured from him by the Applicant;

(ii) the amendment of the contract’s Annexure A Special Condition 4 by deleting the word “later” and inserting the word “earlier”.

2. The Applicant’s costs of and incidental to this application be paid out of the assets of Victoria . (including the nett proceeds of the said sale) on the indemnity basis.

3. I will hear the First and Second Respondents as to what, if any, order should be made as to their costs at 9.15 am 7 December 2022 (out of town parties having leave to appear by telephone), unless the Applicant in her capacity as enduring attorney of and for Victoria . reaches agreement with the First and Second Respondents about their costs in the meantime.

4. Liberty to apply on the giving of two business days notice in writing.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

The arguments of Patricia and Michael’s counsel against the court’s authorisation of the transaction, insofar as they are related to potentially determinative facts, coalesced into arguments that: the proposed sale is at an undervalue, there is no evidence Victoria lacks capacity in financial matters, the transaction is contrary to Victoria’s wishes and the transaction is not in Victoria’s best interests.The Court’s statutory decision-making process Those issues fall for consideration in the exercise of the court’s protective jurisdiction, which evolved at common law to enable care to be taken of those without capacity to take care of themselves.[4] This involved a form of substituted judgment by which the court judged what was in the person’s best interests, including by consideration of what the person would likely want done if capable of self-management.[5] The exercise of that protective jurisdiction in respect of those who have executed an enduring power of attorney now involves a decision-making process stipulated by the Powers of Attorney Act 1998 (Qld). [4]Secretary Dept Health and Community Services v JWB and SMB (Marion’s Case) (1992) 175 CLR 218, 258.[5]Ex Parte Whitbread in the Matter of Hinde, a Lunatic (1816) 2 Mer 99; 35 ER 878. The proposed sale is a so-called conflict transaction according to s 73(6) of the Act, because it “is a transaction in which there may be conflict … between … the duty of an attorney towards the principal; and … the interests of … a relation … of the attorney”. Section 73(1) provides an attorney may enter into a conflict transaction “only” if the principal or the court authorises it. Victoria’s mental state precludes her authorisation. For an authorisation by the court to occur s 73(1) requires it to be authorised under s 118(2) of the Act. Section 118(2) relevantly provides:“…[T]he court may, by order and subject to the terms the court considers appropriate, authorise an attorney, either generally or in a specific case, to undertake a transaction that the attorney is not otherwise authorised to undertake or may not otherwise be authorised to undertake, if the court is satisfied the transaction would be in accordance with the general principles.” Section 118(2)’s reference to the “general principles” is to a group of ten guiding statutory principles in s 6C of the Act, of which more will be said shortly. The content of s 118(2) contemplates the court “may” make an order authorising the transaction “if” it is satisfied the transaction accords with the general principles. It follows s 118(2) requires the court to answer two questions in the affirmative before deciding to give an authorisation, namely:(1)Is the court satisfied the transaction accords with the general principles? (2)Should the court exercise its discretion to authorise the attorney to undertake the transaction? The requirement that the court be satisfied the transaction would be in accordance with general principles was introduced by amendment to s 118(2) in the Guardianship and Administration and Other Legislation Amendment Act 2019 (Qld). Prior to this amendment the relevant pre-condition to the exercise of the discretion to authorise was that “the court considers it in the best interests of the principal”. That change did not remove the interests of the principal as a relevant consideration. It is inevitably a consideration relevant to whether the discretion to authorise the attorney to undertake the transaction should be exercised, because the attorney’s fiduciary duty, mandated by s 66 of the Act, is to “exercise power honestly and with reasonable diligence to protect the principal’s interests”. Additionally, the general principles also mandate consideration of whether the transaction is in the interests of the principal, per principle 9.

Ratio Decidendi

Legal Principle Established

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CITATION:	BP v PM & Ors [2022] QSC 268
PARTIES:	REDACTED
FILE NO/S:	263 of 2022
DIVISION:	Trial
PROCEEDING:	Application
ORIGINATING COURT:	Supreme Court of Queensland at Cairns
DELIVERED ON:	2 December 2022
DELIVERED AT:	Cairns
HEARING DATE:	21 November 2022
JUDGE:	Henry J
ORDER:	*1. Pursuant to s 118(2) Powers of Attorney Act 1998* (Qld) the Applicant, in her capacity as enduring attorney of and for Victoria is authorised: (a) to sell land located at 196 Powley Road, Barrine in far north Queensland more particularly described as Lot 11 on SP 300464 on behalf of Victoria , in the exercise of the Applicant’s power as enduring attorney of and for Victoria . . , to the Fourth Respondent and the Fourth Respondent’s wife, Kate , as joint purchasers, upon the terms and conditions set out in the written contract, exhibit BP13 to the affidavit of the Applicant filed herewith, and to do all things necessary for or incidental to the effectuation of the said sale, subject to: (i) the price being the valuation ascribed to the property by Trevor Gard in an updated market valuation to be procured from him by the Applicant; (ii) the amendment of the contract’s Annexure A Special Condition 4 by deleting the word “later” and inserting the word “earlier”. 2. The Applicant’s costs of and incidental to this application be paid out of the assets of Victoria . (including the nett proceeds of the said sale) on the indemnity basis. 3. I will hear the First and Second Respondents as to what, if any, order should be made as to their costs at 9.15 am 7 December 2022 (out of town parties having leave to appear by telephone), unless the Applicant in her capacity as enduring attorney of and for Victoria . reaches agreement with the First and Second Respondents about their costs in the meantime. 4. Liberty to apply on the giving of two business days notice in writing.**
CATCHWORDS:	HEALTH LAW – GUARDIANSHIP, MANAGEMENT AND ADMINISTRATION OF PROPERTY OF PERSONS WITH IMPAIRED CAPACITY – ADMINISTRATION AND FINANCIAL MANAGEMENT – where the applicant is the attorney for financial and personal/health matters of the adult, her mother – where the adult is in permanent residential care at a care facility – where the adult does not have capacity to make decisions about personal health and finances – where the adult owns a small cattle property which is being maintained by the applicant and three of her siblings and its only income is from renting of one of the houses on the property – where the applicant seeks approval from the court to sell the property to her brother at market value – where the transaction is a ‘conflict transaction’ – where the court may approve a ‘conflict transaction’ if satisfied it would be in accordance with the general principles of the Power of Attorney Act 1998 – where two of the respondents, who are siblings of the applicant, oppose the…