Bradley Seymour Cranfield and Brian Leonard Cranfield v Sharon Elizabeth Murray and Christopher Keith Davis No. SCGRG 2442 of 1985 Judgment No. 3626 Number of Pages 14 Trusts and Trustees

[1992] SASC 3626

COURT IN THE SUPREME COURT OF SOUTH AUSTRALIA LEGOE J

CWDS
Trusts and trustees - applications to the Court for advice and authority - Application by joint managers of a protected persons estate seeking order giving leave nunc pro tunc - Question of reasonable and professional charges in administering estate Consideration of manager's duties and powers - applicability of professional accountants scale of charges as opposed to annual lump sum calculated on commission - Management and charges of protected estate satisfactory and reasonable - No technical breach of trust by managers - Actions consistent with Aged and Infirm Persons Property Act and Rules thereunder - Costs of and incidental to the application to be paid out of protected estate. South Australian Supreme Court Rules 1987 111.06, 111.07, 111.08, 111.09, 111.10; Aged and Infirm Persons Property Act 1940 (SA) ss6 (1) , 8a, 10(1), (2), (3), (4), 11, 13, 18, 19, 20(1) and (2), 22(1); MentalHealth Act 1977 (SA) 5.26; Trustee Act 1936 (SA) ss 56, 91 and Administrationand Probate Act 1919 (SA) ss 70, 112. In re Darling (1925) SASR 262 at 266 and In re Moris (1939) SASR 305 at 317, applied. Beasley v Marshall (No. 4) (1986) 42 SASR 407 and Public Trustee v Sweeney &; Ors (1981) 32 SASR 343, discussed.

HRNG ADELAIDE, 17 February, 16 March 1992 #DATE 22:9:1992 Appearances not known.

ORDER
Order that the statements which have been filed in the Court in respect of the management of the protected estate should be accepted as satisfactory and a reasonable statement of the affairs of the protected estate.

JUDGE1 LEGOE J This is an application in the above-named proceedings for the determination of certain questions and the obtaining of certain orders pursuant to the Aged and Infirm Persons Property Act, 1940 (SA) ("the Act"). In the application, the applicants, who are the managers of the protected estate of the plaintiff in the action, Bradley Seymour Cranfield, seek the following orders:-
    "1. That there be an order nunc pro tunc that the
    remuneration of the said managers in respect of the management
    of the estate of the plaintiff Bradley Seymour Cranfield be
    allowed at the rate charged by the said managers and that Public
    Trustee have liberty to apply to a Master of this Court in
    respect of such remuneration should it see fit.
    2. That the costs of the within application be paid by Public
    Trustee.
    3. For such further or other order as this Honourable Court
    may deem fit." 2. In the final draft minutes of order submitted on the last day of submissions in this matter, the applicants sought the following orders:-
    "1. That pursuant to ss.6 and 31 of the Aged and Infirm
    Persons Property Act, 1940 there be an order restrospectively
    authorising remuneration to be paid to Patrick Digby Holroyd
    Hill and Ian Allan McFarlane as managers of the estate of the
    plaintiff Bradley Seymour Cranfield in respect of the management
    of the estate of the plaintiff Bradley Seymour Cranfield in such
    annual amounts as are allowed by the Court.
    2. That the within application be referred to a Master for
    inquiry as to the appropriate annual amounts of remuneration
    authorised to be paid to the said Patrick Digby Holroyd Hill and
    Ian Allan McFarlane from the date of their appointment as
    managers and until further order.
    3. Certified fit for counsel. AND further consideration of
    the within application is adjourned. AND the managers and
    Public Trustee, the protected person and any other person
    interested may be at liberty to apply as they may be advised." Relevant Background and Facts 3. The application is supported by the affidavit of both applicants, the joint managers of the protected estate. The relevant background and factual circumstances are as follows:-
    1. On the 20th April 1988 the applicants were appointed by
    an order in the action as managers under the Aged and Infirm
    Persons Property Act to manage the damages awarded in the action
    which made up the protected estate of the first-named plaintiff.
    The relevant parts of the order read as follows:- "1. That
    Patrick Digby Holroyd Hill and Ian Allan McFarlane be and are
    hereby appointed managers to take possession of and hold control
    and manage the whole of the estate of the protected person
    within the powers and duties given and imposed by the Aged and
    Infirm Persons Property Act, 1940 and any Act amending the same
    or in substitution therefore or any Rules of Court made
    thereunder. 2. That in addition to the powers conferred on the
    managers by the said Act the managers shall have the following
    powers namely to invest the unapplied corpus or income of the
    protected estate in any of the investments from time to time
    authorised for the investment of trust funds by the Trustee Act,
    1936 ..." The other orders made were those that are normally
    provided by the standard form of orders published in this Court
    for the administration and protection of a person requiring
    protection under the Act.
    2. The plaintiff had been awarded a large sum of money, namely,
    a sum of approximately $1,000,000 in respect of very severe
    personal injuries which he had suffered in the motor vehicle
    accident the subject of the action.
    3. The applicants were appointed pursuant to the provisions of
    s.8a of the Act, namely, being an action by a person for damages
    for personal injuries sustained where it appeared to the Court
    that by reason of that injury that person suffers or is likely
    to suffer some physical or mental infirmity by reason of which
    he is unable, wholly or partially, to manage his affairs, then
    the Court may, of its own motion or on the application of a
    prescribed person, make a protection order in respect of the
    estate or part of the estate of the person in respect of whom
    damages are to be awarded. After hearing certain evidence, and
    after consideration of some prior authorities, namely, Campbell
v Nangle (1985) 40 SASR 161, particularly at p 192 per King CJ,
and further Beasley v Marshall (No. 2) (1986) 41 SASR 299 at 303
    per Lunn AJ, I made the order appointing the applicants the
    managers of the protected estate, being the sum of money which
    was awarded by way of damages in the action. My reasons for
    making the order appointing the applicants as the joint managers
    of the protected estate are set out in volume 142 LSJS pp.425/5.
    4. Part of the material upon which I based my decision is
    contained in exhibit "D" to the affidavit of the applicants
    filed in support of this application, which is a letter from
    Public Trustee dated 26th February 1987 setting out the basis of
    Public Trustee's "commission and fees determined in accordance
with the regulations made pursuant to s.112 of the
    Administration and Probate Act, 1919" as provided in s.31(2) of
    the Act.
    5. Since the order of the 19th April 1988 appointing the
    applicants as joint managers of the protected estate, they have
    performed services in respect to the estate and rendered
    accounts on a regular basis to the estate for those professional
    services. Those accounts are exhibited to the applicants'
    affidavit in this application. Further, in accordance with the
    requirements of the Act and the Supreme Court Rules, the
    applicants have filed annual returns in respect to the estate
    which disclose the accounts for those services. The Public
    Trustee has conducted an audit of the affairs of the estate each
    year since their appointment. The applicants also depose to the
    fact that this practice is identical with the practice they have
    jointly adopted in respect of a number of other protected
    estates in which they have been appointed managers, either
    singly or jointly.
    6. Finally, the applicants have exhibited to their affidavit a
    bundle of correspondence passing between their firm and Public
    Trustee and a firm of solicitors, Messrs Scales &; Partners and
    the Public Trustee, in respect to whether the Supreme Court has
    allowed the remuneration in accordance with s.31 of the Act.
    In the course of that correspondence, in a letter from Public
    Trustee dated 15th February 1991 and addressed to Mr I.A.
    McFarlane, one of the applicants herein, the Public Trustee
    referred to a Court order which had appointed Mr McFarlane on
    the 18th of May 1990 as manager of the protected estate of one
    V.M. Ferdinands with the powers and duties imposed and given by
    the Act. The Public Trustee pointed out that the order made no
    provision for Mr McFarlane's fees. The letter then continued:-
    "S.(31)(1) of the Aged and Infirm Persons Property Act provides
    there shall be payable to the manager '... such remuneration by
    commission or otherwise ... and such other charges, as are
    allowed by the court ..." Accordingly, Court approval for your
    charges is required. Public Trustee has had these provisions
    brought to his attention and is, accordingly, now advising
    managers of their obligations.".
    7. After receiving that letter from Public Trustee, the
    applicants sought the opinion of senior and junior counsel who
    were counsel in this action. There are a number of other
    actions in which they were appointed as managers of protected
    estates. The applicants were provided with a written opinion
    advising them that in some of the appointments it was on the
    explicit understanding, and in some other appointments on the
    implicit understanding, that the Court had allowed the
    applicants' charges for administering the estates at the time of
    making the orders and there was no need to obtain the approval
    of the Court for the professional charges, as required by Public
    Trustee in the correspondence.
    8. The Public Trustee indicated that he did not accept
    counsel's advice and referred the matter to the Registrar of the
    Supreme Court. Subsequently, the Public Trustee lodged a report
    pursuant to Rule 111.07(4) on 17th January 1992 in respect of
    the protected estate of Ferdinands, referred to above, in which
    the applicant Ian Allan McFarlane was appointed the sole
    manager. Accordingly, the applicants, in view of the impasse
    which had arisen, seek an order from this Court giving leave
    nunc pro tunc allowing their remuneration as set out in the
    accounts filed in this Court pursuant to s.31 of the Act. Arguments Submitted upon the Hearing of the Application 4. Senior counsel for the applicants referred me to a number of provisions in the Act and the authorities which I have already referred to above. Counsel pointed out that a manager is deemed to be a trustee pursuant to s.18 of the Act. As a matter of the general law, a trustee is not entitled to any remuneration. If authority were needed for that well known proposition, it is to be found in the two authorities to which counsel for Public Trustee referred me, namely, In re Darling (1925) SASR 262 at 266 where Angus Parsons J said:
    "In my judgment, it is irregular for a trustee to take any
    money by way of commission or remuneration without an order of
    the Court, or the consent of the beneficiaries when all of them
    can legally give such consent. The proper method to adopt is to
    apply to the Court on petition promptly when occasion arises,
    and to make further applications from time to time as may be
    appropriate. In this case the trustees seem to have met at the
    end of each financial year and decided upon their own salaries
    and bonuses, as though they were not trustees but paid managers
    of the trust estate, a position which is inconsistent with their
fiduciary duties as trustee." In re Morish (1939) SASR 305 at 317 Murray CJ said:
    "The rule is that trustees must act gratuitously in the execution
    of their trust unless the Court approves of a salary being received
    by them when they are appointed, or unless on any application being
    made under s.78 of the Administration and Probate Act 1891, (now
    s.70 of the Administration and Probate Act 1919/1936), the Court
    thinks fit to grant them some remuneration for their services in
    the actual administration." 5. Counsel for the applicants drew my attention to the fact that trustees may receive remuneration where remuneration is either expressly or impliedly provided in the instrument of trust: see generally Jacobs on The Law of Trusts in Australia, 5th edition at p.416. 6. Counsel for the applicants submitted that the order creating the appointment as private managers in this action by necessary and unavoidable implication, provides that the private managers will be entitled to their proper professional costs. He added that the Court, in making the order, was making it on the understanding that the accountants, as professional persons being appointed managers by reason of their expertise and knowledge of the supervision of such estates, would be administering this protected estate through their professional practice and as such would charge the estate the proper and appropriate professional fees. Counsel pointed out that the advantage that the particular managers would bring to the administration of this estate was detailed in the evidence before me when I made the order in April 1988. Furthermore, the basis of the professional charges were fully detailed and explained. In these circumstances, it was clear counsel for the applicants submitted that the order of the Court necessarily was predicated on the basis that the managers would be paid their proper professional charges in the administration of the protected person's estate. Although in this case the damages had not been assessed by the Court, because the action was compromised, the order for the large award of damages was made on the basis that the heads of damage included the future cost and expense of running and administering the protected estate. 7. Both counsel for the applicants and counsel for Public Trustee referred me to a number of provisions in the Act. I shall summarise and make some brief reference to these provisions. S.6(1) of the Act provides, inter alia, that if any circumstances arise for which no procedure is provided by the Act, or if there is any doubt as to what is the correct procedure, then the Court, having regard to the general practice, may direct, and, if thought fit by ex parte proceedings, "what shall be done in any particular case, or that the procedure which has ben adopted shall be deemed proper, or may make such order to meet the circumstances of the case as he deems fit". 8. Section 10(1) of the Act gives the Court a discretion where it thinks fit to make a protection order. It further provides that the Court shall, in making the protection order, appoint "the husband or wife or near relation by blood or marriage of the protected person" OR "some other person, or any body corporate incorporated in this State by or pursuant to any law of this State, either alone or with any other person or persons" OR "the Public Trustee alone" to be the manager to take possession of and to control and manage all or part or parts of the estate of the protected person as the Court may direct. My order of April 1988 selected the alternative of "some other person(s)." By sub-s(2) the Court shall not appoint any person to be manager together with the Public Trustee. By sub-s(3) the Court may require any manager other than the Public Trustee to give such security as to the Court seems fit for the due performance of the duties of the manager. In this matter, the applicants offered security which formed part of my order. Finally, by sub-s(4), if a person other than Public Trustee is appointed then the Court shall cause a copy of the protection order to be supplied to Public Trustee. 9. Although not referred to by counsel, I note that pursuant to s.11 of the Act the Court may rescind any protection order, or may vary such order so as to apply to part of the estate at the time of the variation (see sub-s(2)) and that a protection order shall be determined by the death of the protected person (sub-s(3)). 10. The powers of managers are specified in s.13 of the Act. Unless the Court in any particular case otherwise orders, the manager has the following powers - taking possession of the protected estate and recovering possession from any person holding the same, repairing and insuring against any contingency or any part of the estate, demanding, recovering and receiving monies and personal effects payable to or belonging to the protected person. More particularly in sub-s(1) sub-para (iv), managers have the following power:- "To apply any moneys (whether arising from real or personal property, and whether income or capital) for the maintenance of the protected person, and the wife or husband and children of the protected person, and for the education of the children of the protected person, and in payment of the debts and liabilities of the protected person." 11. I have already mentioned above that a manager is deemed to be a trustee for all the purposes of the Trustee Act, 1936 pursuant to s.18 of the Act. Section 19 is an important provision in this application. By sub-s(1) the manager of every protected estate is obliged, at such times and in such manner as is directed by order of the Court or prescribed by rule of Court, to prepare and file in Court a statement, verified by the affidavit of the manager, showing the property comprised in the protected estate, and the condition thereof, and the manner in which the property has been dealt with, administered, or applied, and such other particulars as may be prescribed, or as may be in any special case directed by the Court to be included in the statement. Rule 111.06 of the Supreme Court Rules provides that within three months of appointment a manager shall file, and if he is not the Public Trustee, serve on the Public Trustee, a statement verified by affidavit showing particulars and the estimated values and condition of each item of property comprising the protected estate as at the date of the protection order together with details of all income payable to the protected estate and of its liabilities, present, future and contingent as at that date. Rule 111.07 provides for the annual returns to be filed and served by a manager of a protected estate. In effect, every manager shall, by 30th September in each year, file and serve on the Public Trustee an affidavit containing "a full and true account of all the assets, income and liabilities of the protected estate for the period since the last similar account was filed up until 30th June in that year provided that it shall not be necessary to file such an affidavit where a statement filed under Rule 111.06 covered the period up to 30th April in that year". The other sub-rules under Rule 111.07 are not relevant in this application. Rule 111.08 provides in effect that a manager other than Public Trustee shall deliver to Public Trustee "such documents and vouchers as Public Trustee may require in relation to any matter relevant to the accounts which have or should have, been filed by the Manager so as to ensure that Public Trustee will be in a position if he wishes to verify all accounts filed". Rule 111.09 provides for the payment of a commission on a percentage basis for the lump sums provided in such Rule, payable to a trustee company manager. There is, however, no provision in relation to the payment of commission by way of remuneration to personal managers of a protected estate, otherwise referred to in the course of these proceedings as the "private" managers. 12. By s.20(1) of the Act provision is made that where a private manager is appointed, and services are rendered by the Public Trustee to the protected estate, the manager shall pay to the Public Trustee out of the estate such remuneration as the Court may from time to time direct. Section 20(2) provides that a private manager shall pay out of the estate the fees of any auditor appointed by the Public Trustee. 13. Section 22(1) of the Act states that proceedings under Part II ss.7 to 32(b) inclusive, whether commenced by originating summons, application under section 8a of the Act or on the Court's own motion, "shall remain open for application to be made therein from time to time to the court by the manager, or the protected person, or the Public Trustee, or by any relation of the protected person, or by any person interested in the protected estate". Clearly, this application is made pursuant to that section. By sub-s(2) it is provided that it is necessary to serve with notice of the application "only such persons or parties (if any) as the court on the application requires to have notice thereof". In this application, it is only the Public Trustee who has been served with the application which has been referred to me by a Master. 14. Section 31 is the section which makes provision for expenses and remuneration of managers. That section provides as follows:- "31(1) All expenses properly incurred by the manager in respect of the maintenance of the protected person, or the administration of the protected estate, shall be charged against and payable out of that estate; and in addition, there shall be payable in respect of all moneys forming part of the protected estate, and coming under the control of the manager, such remuneration by commission or otherwise to the manager, and such other charges, as are allowed by the court in any manner thought fit by the court." 15. Sub-s(2) provides for the commission and fees and such other charges as may be allowed by the Court when the Public Trustee is the manager. Those are the commission and fees determined in accordance with the regulations pursuant to s.112 of the Administration and Probate Act, 1919. It is quite clear that the basis for remuneration by commission or otherwise to personal or private managers is different and distinct from the basis of the commission and fees payable to the Public Trustee, which is at a certain percentage rate on capital and income as provided by the provisions of the Administration and Probate Act pursuant to s.31(2). 16. Counsel for the applicants submits as a matter of construction that s.31(1), insofar as provision is made for "all expenses properly incurred" by the manager in respect of "the administration of the protected estate" applies and covers the proper and reasonable professional charges of a manager who is an accountant. Counsel further submitted that, in accordance with these principles, this Court has approved and allowed managers to charge proper professional charges in cases where a professional private manager is deemed appropriate, either because of the magnitude of the amount of funds in the protected estate, whether arising from an award of damages or otherwise, or because of other difficulties in the management and supervision of the protected person and his or her estate. 17. Another question for issue which arose during the course of submissions on this application related to the concern that the Court has expressed in the making and bringing of unnecessary applications to the Court, having regard to the substantial costs involved. In Beasley v Marshall (no.4) (1986) 42 SASR

407 at p.412 King CJ said:- "Although I would strongly discourage managers from seeking directions from the court in relation to the application of damages allowed for gratuitous services, there may be situations in which the manager feels impelled to make use of his right pursuant to s.24 of the Act to approach the court." 18. Those remarks were made in relation to the payment to persons who had provided gratuitous services being made by the Public Trustee. The power of the Public Trustee to make application to the Court is pursuant to s.24 of the Act whereas the private or personal managers make their application pursuant to s.22, referred to above. In Beasley v Marshall (supra) the Court made it clear that Public Trustee as manager of a protected estate should not normally incur the cost of seeking directions of the Court on the question of payment out in respect of sums of money awarded by way of damages in that case in respect of voluntary services. In this regard, counsel for the applicants submitted that it would be onerous and commercially highly unrealistic for managers to have to submit their charges for monthly approval, bearing in mind the extensive supervision of the protected estate carried out by the manager. It was submitted this would be an unwarranted burden on the protected estate. The scheme of supervision or control of the funds in the protected estate is that provided for in s.19 of the Act and in Rule 111 of the Supreme Court Rules, which I have set out above. It is also to be noted in this case, as counsel for the respondent pointed out, that where a bond has been given then Rule 111.10 further provides that any person who is given a bond for the due conduct of administration of a protected estate, or any surety for any such bond, has died or ceased to carry on business or become bankrupt or entered into an arrangement with creditors or been put into liquidation or gone under official management or receivership, then the manager shall forthwith apply to the Court for directions. 19. Upon these submissions, counsel for the applicants submitted that it was proper in this case for the applicants to make application to the Court to clarify the basis upon which payment should be made to the managers for their reasonable and proper professional charges by way of remuneration, by commission or otherwise, as provided in s.31(1) of the Act. 20. On the other hand, counsel for Public Trustee submitted as follows:-
    1. Counsel agreed with counsel for the applicants that the
    manager who is deemed to be a trustee under the Act is not
    entitled to remuneration at common law. Accordingly, pursuant
    to this Act, the Court should be slow to accept the manager's
    submission that an order made under s.8a of the Act appointing
    them managers should be construed as impliedly authorising the
    automatic deduction of those charges from the accounts of the
    protected estate.
    2. Counsel then submitted (in the absence of separate
    statutory authorisation) that trustee, including a private or
    personal manager under the Act, is not entitled, without
    application to the Court, to take remuneration from the estate.
    Counsel submitted that it is irregular for a trustee to take
    any money by way of commission or remuneration without an order
    of the Court, and reference was made to In re Darling (supra)
    and In re Morish (supra).
    3. Counsel then submitted that s.31(1) of the Act is divided
    into two parts and that the latter part is disjunctive,
    expressly dealing with remuneration to a manager and upon its
    natural and ordinary meaning requires a specific order allowing
    remuneration.
    4. Upon this interpretation of s.31(1) of the Act, counsel
    submitted that there is a clear separation of statutory powers
    under the Act, namely, first the appointment of a manager
    pursuant to s.8a of the Act which does not include any order for
    remuneration to be paid to the manager pursuant to s.31(1) of
    the Act and, secondly, the long-standing practice requiring
    express orders for remuneration of trustees, referred to above,
    which means that the order appointing the managers in April 1988
    did not contain any implied authority for those managers to
    deduct their remuneration from the protected estate.
    5. If the above submissions are accepted then the deductions
    which have been made by the applicants, the managers of the
    protected estate, have been made, in the submission of counsel
    for the Public Trustee, in breach of trust. However, counsel
    hastened to point out that Public Trustee was in no way
    suggesting that either or both of the managers had ever acted
    other than in good faith. Indeed, Public Trustee does not
    oppose the making of an order retrospectively authorising the
    deduction by the managers of a proper remuneration, but submits
    that the terms of the minutes of order sought by the managers
    are in this regard inappropriate.
    6. Counsel for Public Trustee then submitted that the
    respective order required by the managers ought to be made
    pursuant to s.31(1) and s.6(1) of the Act, and (if considered
necessary) pursuant to s.56 of the Trustee Act. 21. Counsel for the Public Trustee then submitted that the managers entitlement to remuneration by way of commission or otherwise should not be based on the professional accountants scale as claimed in this particular matter. Counsel referred to a number of other protected estates, most of which have been administered by the Public Trustee, or by personal managers who are relatives or in some other way closely related to the protected person who, generally speaking, do not charge and are not paid a commission or other remuneration. Counsel stated that there were two other estates managed by private managers namely in Action No. 3286 of 1980 where Angela Marino Anthony Farese is the protected person whose estate is managed by Allan Ralph Raphael, appointed on the 15th of May 1985, and in Action No. 3401 of 1983 Krista Lee Duigan is the protected person, whose estate is managed by the Bank of New South Wales Nominees Pty. Ltd., appointed on the 23rd August 1985. Both of those private managers have applied periodically for orders fixing annual lump sum remuneration. Counsel submitted that this application is the first time, of which the Public Trustee is aware, in which private managers have sought remuneration other than by an annual lump sum figure. Counsel then submitted that if an order is made allowing remuneration by way of periodic charges under a professional accountants scale without setting an annual maximum amount, the order will create a precedent. Public Trustee queries whether it is desirable to set such a precedent. Counsel agreed that the words "or otherwise" in s.31(1) of the Act could be construed as permitting remuneration in accordance with professional accountancy fees. However, in the Administration and Probate Act 1919s.70 the words used "such commission or other remuneration ... either periodically or otherwise, as is just and reasonable" apply to managers under that Act by virtue of a combined force of s.91 of the Trustee Act 1936 and s.18 of the Act. Counsel then referred to the principles upon which trustees' remuneration, in addition to commission, was considered in the case of administration of a deceased's estate; see In re Barr Smith (1920) SALR 380. Counsel referred to a number of authorities relating to professional fees which could be recovered, not strictly being trustees work, without additional charge to the estate unless the will of the deceased person expressly provides for this in a charging clause see In re Edmonds (1943) VLR 97 at 99-100 per O'Brien J and In re Moore
(1956) VLR 132. 22. On this basis counsel for the Public Trustee submitted that a professional accountant appointed as a personal or private manager of a protected estate ought only to be remunerated by an annual lump sum calculated on commission, and not on a professional accountant's scale of charges. The appropriate rate of commission would, in counsel's submission, be that fixed by Rule 111.09 which relates to the commission for a trustee company manager. For these reasons, counsel for the Public Trustee submitted that this application should be referred to a Master to identify the appropriate annual remuneration which ought to have been deducted by the managers since their appointment. For these reasons, counsel submitted, the order which is sought by the managers here is inappropriate as it would have the effect of removing from the Court the decision as to the appropriate past and future remuneration and substituting the rate charged by the managers. Counsel rationalized this submission by submitting that although there are alternative procedures available to the Public Trustee to seek review of charges made by managers, that is not to the point here as the protected person is entitled to the protection of the Court's scrutiny of the managers initial application for approval of remuneration as well as the subsequent protection afforded by other legislation; see In re Edmonds (supra) at p 100. 23. In the alternative, if the above submissions of counsel for the Public Trustee are not accepted and the managers are entitled to remuneration based on a professional accountancy scale, then the matter should be referred to a Master to establish whether the charges made by the managers are appropriate. In this regard counsel submitted it would be necessary to establish:-
    (a) the scale and items used by the managers from time to
    time;
    (b) whether there was any, and if so what, generally
    recognised proper professional scale of charges over the same
    periods;
    (c) particulars of the attendances;
    (d) particulars of the time spent and by what category of
    service provider. 24. Counsel referred to the evidence of the applicant Hill at the hearing before me when the estimated annual fee for managing this protected estate was given at $5,700.00. Counsel pointed out that the average actual annual fees have been $10,700.00 without information having been provided by the managers as to the difference. The Court should accordingly be cautious approving any increase in the managers fees without clear evidence. In any event counsel submits that whether it is an allowance by reference to commission or professional fee scale or otherwise, the form of the order should be for an annual maximum lump sum rather than unlimited. The alleged advantages in this system would be:-
    (1) The manager is obliged at the onset to provide
    sufficient information to the Court to enable the decision to be
    made on an ascertainable basis as to what sum represents proper
    remuneration.
    (2) The amount of the remuneration may be readily identified
    by Public Trustee when preparing his report under s.19 of the
    Act. At present no charge is made by the Public Trustee for
    this service.
    (3) If remuneration is ordered to be paid to a manager by
    reference to a professional accountants scale, without annual
    limit, a far more onerous and time consuming task will be
    imposed to prepare a proper report, akin to a general
    assessment of a bill of costs. If substantial services are
    provided by the Public Trustee, an additional expense will be
    imposed on the estate, being the remuneration which the Public
    Trustee would be obliged to seek under s.20(1) of the Act.
    (4) Alternatively, this more onerous task will have to be
    performed by an auditor appointed by the Public Trustee under
    s.20(2), and again this additional expense will be borne by the
    estate. 25. Counsel for the Public Trustee does not suggest that the managers should submit claims for remuneration to the Court on a monthly basis. The managers need only do so after making an initial application for an annual lump sum, and the Master on being satisfied as to the reasonableness of this figure, would order that the manager be entitled to an annual remuneration up to the identified figure until further order. It may be several years before a manager would consider it necessary to apply to increase the annual figure for remuneration. If there was some substantial additional work in respect of a particular matter, the manager would be entitled to apply to the Court for a further order. The benefit to the protected person of certainty in the application of estate monies under the Court's supervision would justify the additional expense of such periodic payment. 26. In so far as it is suggested by the applicants that the Public Trustee's suggested annual limit on the remuneration is cumbersome and expensive along the lines suggested in Beasley v. Marshall (supra) at p 412, counsel for the Public Trustee submits that that case was confined to the value of gratuitous services and is therefore not applicable here. Counsel submits that this is an important issue of substance and that the legal basis for the deduction of remuneration by the manager should be properly established otherwise there is no legal entitlement to the remuneration. If the principles In re Barr Smith (supra) apply then the application presently made here is contrary to binding authority of this Court. 27. Finally counsel for the Public Trustee pointed out that the Public Trustee is obliged by statute and the Rules of the Supreme Court to monitor the administration of protected estates by private managers. The Public Trustee does require the guidance of the Court's decision on this issue. Other than opposing the order that any costs be made against the Public Trustee, Public Trustee submits that the question of the costs of the manager is to be dealt with in the Court's discretion. 28. Up until this application was made I note that the managers have filed the appropriate affidavit each year exhibiting the balance sheet together with notes setting out the assets and liabilities of the estate as at the previous 30th of June, and the Income and Expenditure Statement for the estate covering the year ending the 30th June 1990 together with supporting Schedules detailing the items in those Statements. For the year ending the 30th June, that is Document No. 64 on the file. Document No. 65 is the Public Trustee's Report for that year in which it is stated that "PUBLIC TRUSTEE considers that the reports are satisfactory and that the accounts would appear to show the true financial position of the protected person as at the 30th June 1989 and the 30th June 1990." That is dated the 19th December 1990. The auditor's report dated the 3rd December 1990 is exhibited to the Public Trustee's Report in which the auditor states
    "...the managers' charges were looked at, and the evidence
    on the files shows that they are active in the personal affairs
    as well as the business affairs of the protected person.
    Bradley Cranfield obviously has some real difficulties and has
    appeared in court on a number of occasions for driving offences
    and assault. There is evidence of close attention to investment
    matters as well as the day to day matters such as payment of
    accounts and banking of monies. Bearing in mind that both
    managers are senior partners of a large professional firm the
    charges are not unreasonable." 29. For the following year ending the 30th June 1991 the appropriate affidavit exhibiting accounts was filed in this matter and the Public Trustee reports in similar terms that they are satisfactory and that the accounts would appear to show the true financial position of the protected person as at the 30th June 1991. The Auditor's Report which is also exhibited to the Report states that the charges made by the managers are reasonable in the circumstances. The auditor points out that there is evidence of considerable time being spent on the affairs of the protected person in various matters such as the obtaining of psychological reports, arranging a trip to Manila, subsequent engagement and marriage of the protected person and a car accident. CONCLUSION
30. I do not accept the interpretation which has been put on the provisions of the Act, particularly s.31(1), by counsel for the Public Trustee. In my judgment that section does provide for the remuneration by commission or otherwise to the private or personal manager and such other charges as may be allowed by the Court in any manner thought fit by the Court. It seems to me that the remuneration by commission or otherwise to the manager is such remuneration as is appropriate for the type of manager who has been appointed. In this case professional accountants were appointed for reasons which were given at the time of the making of the order. That situation has not changed, indeed the general circumstances as appear from the papers have confirmed the appropriateness of making an order to those professional persons. In my opinion the making of a fixed lump sum or charges would not be appropriate in this case. It would be too inflexible to fix an upper limit of commission along the lines stated in R.111.09 whereby remuneration of a commission of 5 percent is allowed on all income collected and a capital commission of 4 percent on the first $50,000.00, 3 percent on the next $50,000.00, 2 percent on the next $100,000.00 and 1 percent on the balance. Such remuneration by way of commission is payable on an annual basis. The accounts in this case show that the professional accountants have charged appropriate fees for the work that they have actually done. These fees are contained in the annual statements which have been filed in the Court pursuant to the provisions of s.19 of the Act and R.111.07. The Public Trustee is obliged to report on these statements and has in fact done so each year. Furthermore, those accounts have been audited. In my judgment payment of remuneration by commission to these managers would be entirely inappropriate and would be inflexible. In my judgment the requirments of section 19 of the Act and Rule 111 give a sufficient protection, which is not only contemplated but authorised by the Act for the protection of the estate. This procedure for professional charges remuneration is authorised by section 31(1) of the Act. 31. For these reasons, in my opinion, there should be an order that the statements which have been filed in the Court in respect of the management of the protected estate should be accepted as satisfactory and a reasonable statement of the affairs of the protected estate. The charges to the managers should be accepted as reasonable as stated by the auditor in each of the annual reports on file. In my opinion there has been no technical breach of trust by the managers in this matter. In my judgment the provisions of the Trustee Act are not applicable for the purpose of fixing any Commission by way remuneration. In my opinion the costs of and incidental to this application should be paid out of the protected estate just as by way of analogy the application of the Public Trustee in the case of Public Trustee v. Sweeney and Ors (1981) 32 SASR 343 was reasonable for the protection of the person whose assets were subject in that case to a Guardianship order under s.26 of the Mental Health Act. For these reasons there will be liberty to the parties to speak to the minutes. I decline to make an order fixing the upper limit of the remuneration by way of commission or otherwise and authorise that the procedure adopted by the managers in this matter is consistent with the Act and Rules thereunder. I certify this application to be fit for senior and junior counsel. The application raised questions of general importance to orders appoint "personal or private managers" under the Act and the basis for payment of "remuneration by Commission or otherwise."