CH
[2007] WASAT 223
•31 AUGUST 2007
CH [2007] WASAT 223
| STATE ADMINISTRATIVE TRIBUNAL | Citation No: | [2007] WASAT 223 | |
| GUARDIANSHIP AND ADMINISTRATION ACT 1990 (WA) | |||
| Case No: | GAA:2032/2006 | 23 AUGUST 2007 | |
| Coram: | MS J TOOHEY (SENIOR MEMBER) MR J MANSVELD (MEMBER) MS D DEAN (MEMBER) | 31/08/07 | |
| 14 | Judgment Part: | 1 of 1 | |
| Result: | Plenary administrator appointed | ||
| B | |||
| PDF Version |
| Parties: | CH SE LM |
Catchwords: | Administration – Capacity – Complex estate – Need – Whether enduring power of attorney a less restrictive means of meeting needs – Administrator appointed |
Legislation: | Guardianship and Administration Act 1990 (WA), s 3, s 4, s 43, s 43(1), s 64(1), s 64(1)(a), s 77, s 97(1)(b)(iii), s 108(1)(a) |
Case References: | Nil |
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL STREAM : HUMAN RIGHTS ACT : GUARDIANSHIP AND ADMINISTRATION ACT 1990 (WA) CITATION : CH [2007] WASAT 223 MEMBER : MS J TOOHEY (SENIOR MEMBER)
- MR J MANSVELD (MEMBER)
MS D DEAN (MEMBER)
- GAA 2520 of 2006
- 1st Applicant
LM
2nd Applicant
CH
Represented Person
Catchwords:
Administration – Capacity – Complex estate – Need – Whether enduring power of attorney a less restrictive means of meeting needs – Administrator appointed
Legislation:
Guardianship and Administration Act 1990 (WA), s 3, s 4, s 43, s 43(1), s 64(1), s 64(1)(a), s 77, s 97(1)(b)(iii), s 108(1)(a)
(Page 2)
Result:
Plenary administrator appointed
Category: B
Representation:
Counsel:
Represented Person : Ms N Wigg
1st Applicant : Self-represented
2nd Applicant : Mr C Czajka
Solicitors:
Represented Person : Lavan Legal
1st Applicant : Self-represented
2nd Applicant : Downings Legal
Case(s) referred to in decision(s):
Nil
(Page 3)
Summary of Tribunal's decision
1 Applications were made for the appointment of a guardian and an administrator for CH who had inherited a large and complex estate comprising residential and commercial real estate, funds in bank accounts and interests in trusts. Most of the estate was owned jointly with her cousin who disputed the need for either appointment but proposed herself as guardian and administrator in the event that appointments were made.
2 After hearing evidence from a consultant psychiatrist, the Tribunal dismissed the applications for guardianship on the ground that CH was capable of acting on her own behalf within the meaning of s 43 of the Guardianship and Administration Act 1990. However, it was satisfied, on the balance of the evidence before it, that she was unable, by reason of mental disability, to make reasonable judgments about all of her estate.
3 In determining whether CH was in need of an administrator, the Tribunal considered whether an enduring power of attorney by which she had appointed her cousin her attorney was a less restrictive means of meeting her need for assistance in the management of her estate.
4 The Tribunal decided that, in all the circumstances, in particular that most of CH's property was jointly owned with her cousin, it was in her best interests that there be a greater degree of independence and accountability in the management of her estate than would be afforded by the enduring power of attorney. As it was satisfied that her cousin was a suitable person to take on the role, and as CH had expressed her strong wish that she assist her, the Tribunal appointed her cousin her plenary administrator.
Background
5 These proceedings are brought under the Guardianship and Administration Act 1990 (WA) (GA Act) and concern applications by SE and LM, made on 12 October 2006 and 1 December 2006 respectively, for the appointment of a guardian and an administrator for CH.
6 On 21 December 2006, a differently constituted Tribunal adjourned the proceedings so that further information could be obtained about CH's capacity to look after herself and make decisions about her person and her financial affairs, and for LM to provide information about CH's estate.
(Page 4)
7 On 22 May 2007, the Tribunal, constituted as it is presently, adjourned the proceedings so that Dr L, a psychiatrist whom CH had consulted in late January 2007, could undertake a more detailed assessment of her capacity. The Tribunal also ordered LM to provide information about CH's financial affairs to the Public Advocate to whom it had referred the applications for investigation pursuant to s 97(1)(b)(iii) of the GA Act.
8 A further hearing was held on 23 August 2007 at which CH and LM each had legal representation. Also present were representatives of the Public Advocate and members of CH's and LM's families.
9 Prior to the hearing the Tribunal received a request on behalf of CH that SE and two friends of CH, all of whom had participated in previous hearings, be excluded from the hearing unless required to give evidence. It was submitted that the Tribunal would hear medical and financial information about CH's and LM's affairs, and that CH in particular found the intrusion of the proceedings into her personal affairs distressing and objected strongly to the attendance of people outside her family.
10 The Tribunal had previously received extensive written submissions from all three persons. As SE had not seen CH since her discharge from hospital in October 2006 and had no current information to put before the Tribunal, it decided that she should not participate in the hearing unless required to give evidence. The Tribunal decided that CH's friends, from whom she is now estranged, also should not participate unless required to give evidence. As it turned out, the Tribunal decided it was not necessary to hear oral evidence from any of these parties.
The applications
11 SE is a social worker at a hospital where CH was admitted in September 2006, having been taken there by LM who is her cousin and with whom CH had been living. There is no need to recount here the events that led to CH's admission to hospital other than to say that it was clearly a very stressful time for her and LM, and SE had grounds for concern about CH's welfare and LM's ability to continue to care for her. SE asked the Tribunal to appoint an independent guardian and administrator for CH.
12 Applications for the same orders (but proposing herself as guardian and administrator) were lodged a short time later by LM, apparently in the belief that, as an applicant, she was more likely to be appointed. LM stated in her applications that she had cared for CH for many years; it had
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- been the wish of CH's father that she do so and she should continue in that role.
The guardianship applications
13 For reasons given orally at the hearing on 23 August 2007, the Tribunal dismissed the applications for the appointment of a guardian for CH. It accepted the evidence of Dr L, a consultant psychiatrist, that CH is capable of acting on her own behalf and making decisions for herself in matters relating to her person. It is not necessary to detail those reasons further here.
The administration applications
14 There is no need for two applications for an administration order. For convenience, we dismiss LM's administration application because it was submitted later in time. All the information provided by LM in support of her application remains before the Tribunal and has been taken into account in this decision.
15 It is common ground that CH has suffered for many years from simple schizophrenia. Her mother died some years ago. Her father died later, leaving a substantial estate. LM was the executrix and trustee of his will. CH's father left all funds in his personal bank account to LM and appointed her trustee of a trust set up for CH's benefit. He left his personal property and commercial real estate equally to CH and LM and expressed his wish that the women would work in partnership, with LM managing all the commercial real estate and with any income shared equally; in the event that CH pre-deceased him, all his property would go to LM.
16 Not long after her father died, CH left Perth, where she lived, and went to live with LM. Some time later, they moved to live some distance away and continued to live together. In the second half of 2006, LM married. It was evidently a difficult and stressful time for their relationship and decisions needed to be made about where and with whom CH would live. It was around this time that CH was admitted to hospital. Among other things, SE became concerned that CH appeared not to understand the nature and extent of her estate and needed assistance with all aspects of managing her financial affairs.
17 CH's estate has increased considerably in value since her father died. The Public Advocate has attempted to establish in detail the nature and extent of the estate left to her and the dealings in relation to it since then.
(Page 6)
- There are some apparent gaps in the information the Public Advocate has been able to obtain but the Tribunal does not consider them significant for its purposes. What is readily apparent from the information obtained is that CH's estate is sizeable and complex, that most property is held jointly with LM, and that CH relies very heavily, if not entirely, on LM for assistance in the management of her estate including the preparation of accounts.
Relevant legislative provisions
18 The Tribunal may appoint an administrator where it is satisfied, firstly, that the person in respect of whom application is made is unable, by reason of a mental disability, to make reasonable judgments in respect of matters relating to all or any part of her estate and, secondly, that she is in need of an administrator of her estate: s 43(1) of the GA Act.
19 Where the Tribunal is satisfied of both matters, it may by order declare a person to be in need of an administrator, and if it does so, shall appoint an administrator or joint administrators.
20 The principles which the Tribunal must observe when exercising its jurisdiction are set out in s 4 of the GA Act. As they apply here, they are:
• the Tribunal's primary concern must be CH's best interests;
• CH is presumed capable of managing her own affairs and making reasonable judgments in respect of matters relating to her estate until the contrary is proved to the satisfaction of the Tribunal;
• an administration order shall not be made if CH's needs could, in the opinion of the Tribunal, be met by other means less restrictive of her freedom of decision and action;
• an order appointing a limited administrator must be in terms that, in the opinion of the Tribunal, impose the least restrictions possible in the circumstances on CH's freedom of decision and action; and
• the Tribunal must, as far as possible, seek to ascertain her views and wishes.
(Page 7)
Medical evidence about CH's capacity to make reasonable judgments about her estate
21 It is not in dispute that CH has a mental disability (defined in s 3 of the GA Act as including "an intellectual disability, a psychiatric condition, an acquired brain injury and dementia"). She was diagnosed in 1992 as suffering from simple schizophrenia and has seen a number of psychiatrists and mental health professionals, and has been hospitalised at different times, over many years.
22 At the earlier hearings, the Tribunal had before it medical reports in which views were expressed about CH's capacity to look after her personal and financial affairs. Dr K, at the hospital where she was admitted in late 2006, assessed her, while there, as incapable of making reasonable decisions about her personal health care, her living situation or her financial affairs; he noted that her condition, while mostly stable, fluctuated on occasion. SE expressed similar views. Dr H, a general practitioner who had known CH for one week, stated on 6 December 2006 that she was capable in all respects.
23 Dr R, a psychiatrist whom CH had seen at times since 2002, stated in a report dated 20 December 2006 that he was unsure if she could make reasonable decisions about her personal health care, her living situation or her financial affairs. He noted she was "vulnerable to suggestions" and had difficulty stating her own opinion.
24 While these reports provide background, their probative value is limited. It is not in dispute that CH was not well at the time of her admission to hospital when Dr K wrote his report (in a written submission LM describes her behaviour around that time as "bizarre"). Dr H is a general practitioner whose assessment was on the basis of one meeting only. Further, it is in the nature of CH's illness that her condition fluctuates, and all these reports are now some months old.
25 The Tribunal prefers the evidence of Dr L, given in a written report dated 12 August 2007 and in oral evidence at the hearing on 23 August 2007. Dr L saw CH on four occasions over six months, the first time accompanied by LM and the other times on her own. His written report responds to specific questions put to him by counsel for CH in a letter which also set out the matters relating to capacity of which the Tribunal must be satisfied.
26 Dr L reports that CH developed a warm relationship with him over time and she became more relaxed and opened up to him. In his view she
(Page 8)
- clearly suffers from schizophrenia, "a long term chronic condition with occasional fluctuations in severity"; she will require psychiatric supervision probably for the rest of her life; while her prognosis overall is poor, she is currently on appropriate medication which she takes reliably and her prognosis for freedom of symptoms while under treatment is good.
27 At his first interview with CH in January 2007, Dr L did not assess her capacity in relation to the applications. He records that she was "rather vague" in providing an account of herself; although she "did seem intellectually dull (which may have been the result of her psychotic condition) she spoke forcibly about being able to make her own decisions".
28 At the second interview in May 2007, Dr L records that, among other things, CH gave him sufficient information to inform him that she was "quite well aware of both her wealth and where it was". Although her intelligence appeared "at low average levels" she showed no major evidence of psychiatric disability.
29 On the third and fourth occasions, in June and August 2007, CH was more relaxed; she talked about recent travels, her diagnosis of schizophrenia and her medication. Dr L assessed her as "average or above levels of intelligence [with] no evidence of cognitive dysfunction". She understood many aspects of her financial affairs: she knew the location and value of at least some of her real estate and could describe to him the steps required to purchase a house.
30 By way of general comments, Dr L states in his report that CH has "a tendency to concrete thinking with some difficulty in abstract thinking". As to whether she requires assistance in the administration of her estate, Dr L recorded that "[s]he appears at the present time and in her current state of mind to be very unclear about aspects of her estate, her assets and the way they are managedbut [sic] I did not believe she had a sufficient understanding of the processes required and some of the complex decisions that need to be made with regard to managing a significant estate." The nature and extent of the assistance she requires is "quite considerable in the sense that [she] has clear views as to what she owns, what she wishes to do and where she wants to go but her concrete thinking and lack of experience makes it very difficult for her to progress these views. I also believe there may be a deficit in her thinking about future planning and meeting the changes in the economic climate etc."
(Page 9)
31 Dr L's report concludes that CH "clearly requires somebody to manage her estate and to do those things that are required to maintain its value" and to "implement her wishes". He notes throughout his report her clear wish that LM fulfil that role.
32 In oral evidence, Dr L confirmed his view that CH needs advice and assistance; she would not really be aware of the global financial situation but she would not be alone in that. However, while she seems fairly clear that, for instance, she wants a particular house, or to live in a particular country town, or to go on a holiday, "there is a limitation in the execution of these things". In his view, she would have difficulty with part, but not all, of the management of her estate.
33 Dr L was asked whether CH's need for advice, including from an accountant, was a function of her mental illness or her inexperience. He considered it was both because simple schizophrenia leads to a tendency to more concrete than abstract thinking, limiting the ability to think very broadly and make things happen and, further, that CH has had a caretaker all her life and her experience in managing her estate would be limited.
34 Finally, while Dr L assesses CH as capable of acting on her own behalf in matters relating to her person, the Tribunal notes his opinion that, even in those matters, "she does lack some capacity in the area of being able to execute some of the decisions that she takes".
Other evidence
35 In her application, LM states that CH is clear in making decisions about buying and selling property, where she wants to go on holidays, what charities she wishes to support and so on. However, "she needs help with bookwork, taxation, paying bills etc".
36 In correspondence with the Office of the Public Advocate, LM has advised that she attends to all CH's finances and provides her with "the independence of a day-to-day bank account"; at times she had become alarmed at what CH was withdrawing on a weekly basis and suspected that others might be taking advantage of her. In later correspondence with the same office, LM stated that she realises it is necessary that she be appointed "officially" as CH's guardian and administrator.
37 The Tribunal heard that LM discusses every financial transaction with CH unless she is not well enough and CH signs any necessary documents.
(Page 10)
38 The Public Advocate's representative has told the Tribunal that, when she interviewed CH on one occasion, she was vague and unclear about the nature and details of her estate. We accept that was so but it is not reliable evidence of CH's capacity. Dr L has told the Tribunal, and we accept, that CH becomes anxious in new situations and might find it more difficult to give information. We have no way now of testing whether any vagueness at the interview with the Public Advocate's representative was because of anxiety or a more general lack of understanding of her estate.
39 The Tribunal has received numerous written submissions from friends and acquaintances of CH and LM. There are evidently strong and differing views about CH's capacity to manage for herself, the degree of her vulnerability and her relationship with LM. Most submissions testify to LM's devotion and care for CH; others doubt her motivations. CH herself has apparently changed her mind at times and on occasions has told people, including from the Office of the Public Advocate, that she no longer wanted to live with LM.
40 Evidence of things said and done around the time of the applications does not assist the Tribunal greatly other than as evidence of what was happening then. CH's illness fluctuates; she was evidently mentally unwell at the time; events at the time were distressing to her, and LM was under pressure and finding it difficult to care for her.
Is CH capable of making reasonable judgments about her estate?
41 It is submitted for CH that she is capable of making reasonable judgments about her estate and the presumption of capacity in s 4(2) of the GA Act has not been displaced by the evidence before the Tribunal.
42 The estate is substantial and complex. It is submitted for CH that any person would need assistance and advice managing such an estate. That may be so. However, merely because most people would require advice and assistance in managing a complex estate, it does not follow that CH is capable of making reasonable judgments in respect of her estate.
43 The Tribunal has heard, and accepts, that CH knows generally what her estate comprises. However, other than a broad knowledge of her estate and the ability to manage day-to-day financial matters, we have not seen evidence that she is able to assess her estate and make judgments about it for herself. We are not satisfied that it is only with the minutiae of her estate that CH needs assistance. The evidence does not in our view support a finding that she is capable of independent judgments about her
(Page 11)
- estate; in particular, nothing before us indicates any understanding and capacity to make judgments in relation to her interests in the trusts.
44 The fact that LM may discuss transactions with CH does not of itself demonstrate a capacity to make reasonable judgments herself. Understanding what her estate comprises and knowing in gross terms that she wants to buy and sell property is not the same as being able herself to make reasonable judgments relating to her estate. We accept that CH can express wishes when a proposal is put to her. However, the concreteness of thinking and lack of ability to think abstractly identified by Dr L, and her reliance on LM, make it unlikely that she can make reasonable judgments independently.
45 It is evident that CH is capable of expressing her wishes about all manner of things including her estate, but expressing a preference, no matter how clearly, is not the same as exercising independent judgment.
46 To some extent, capacity to manage an estate depends on its size and complexity. Capacity in relation to an estate which involves nothing more than collecting a pension and operating a small bank account might need be only modest but the more complex the estate and the more varied and valuable the assets, the more complex the information to be assessed, the factors to be weighed, and the judgments to be made.
47 Dr L has stated that, when he saw her, CH was very unclear about aspects of her estate and the way they were managed. He did not believe she had a sufficient understanding of the processes required and some of the complex decisions that needed to be made in managing a large estate; she could manage parts, but not all, of her estate.
48 Taking into account the complexity of her estate, we find, on the balance of the evidence before us, that CH is not capable, by reason of her mental illness, of making reasonable judgments about all of her estate.
49 It is not possible to say how much CH's lack of capacity is due to her mental illness and how much to her inexperience generally. It appears that she has been largely protected, first by her father and more recently by LM, from having to act independently in financial matters. Her illness and her inexperience cannot sensibly be separated and it is not necessary to do so. The Tribunal is satisfied, on Dr L's evidence, that her illness sufficiently affects her ability to make reasonable judgments about all of her estate to satisfy s 64(1)(a).
(Page 12)
Is CH in need of an administrator?
50 On 29 January 2007, CH executed an enduring power of attorney (EPA) appointing LM her attorney. It is not entirely clear what led to this decision or who initiated it. It is submitted that CH recognised that there were times when she needed, or might need, someone with formal authority to act on her behalf. It appears that LM has not so far acted pursuant to the EPA in any formal sense.
51 Dr L's view, which the Tribunal accepts, is that CH was capable at the time of executing an EPA.
52 Whereas a declaration under s 64(1) of the GA Act renders a represented person largely incapable of dealing with her estate (see s 77) and is therefore restrictive of decision-making and action, an EPA does not have the same effect.
53 It is submitted for CH that, should the Tribunal find her incapable of making reasonable judgments about her estate, the EPA should be allowed to operate in preference to the appointment of an administrator. It is submitted, in particular, that the fact that CH's and LM's interests are mostly joint, and their interests coincide, positively protects CH's interests and removes any potential for conflict of interests.
54 The Tribunal does not accept that argument in this case. Merely having joint interests does not give rise to a conflict of interests such that one party should not act pursuant to an EPA in managing the affairs of the other. However, CH has been found by the Tribunal to be incapable of managing her financial affairs. LM's relationship to her is thereby fundamentally altered.
55 The Tribunal has heard evidence of a very substantial loan by CH to a trust controlled by LM. It is being repaid and it is not suggested there is anything improper about it. It was submitted for CH and LM that the arrangement merely reflects that they are a family. However, it underlines the need for a degree of independence in the management of their separate interests.
56 In the Tribunal's view, CH's best interests are served by the appointment of an administrator with the additional independence and accountability provided by that appointment, and we appoint LM for that purpose. That is not intended to reflect in any way on LM. However, CH's estate is large and complex and her interests are not necessarily the same as LM's even if their property largely coincides.
(Page 13)
57 In reaching this decision the Tribunal has taken into account CH's strongly expressed wish that LM act on her behalf.
Revocation or variation of the EPA
58 Section 108(1)(a) of the GA Act provides that, where the Tribunal appoints an administrator and the continued existence of an EPA would be inconsistent with the functions of an administrator, it shall revoke the power or vary it to remove the inconsistency.
59 The Tribunal sees no need to revoke or vary the EPA in this case. Although it is rendered ineffectual by LM's appointment as administrator, it is not inconsistent with her appointment and it stands as an expression of CH's wishes.
Conclusion
60 The Tribunal appoints LM plenary administrator for CH for a period of five years. The appointment is plenary because the nature and extent of the estate make it impractical to separate out particular functions or powers to be exercised. However, we expect, and are confident LM will do this, that she allow CH the fullest independence possible in the management of her affairs.
Orders
1. The Tribunal declares that CH is:
(a) unable, by reason of mental disability, to make reasonable judgments concerning all of her estate; and
(b) in need of an administrator.
2. The Tribunal appoints LM to be the plenary administrator of CH with all the powers and duties of an administrator under the Guardianship and Administration Act 1990 (WA).
3. The application by LM is dismissed.
4. This order is to be reviewed by 31 August 2012.
(Page 14)
- I certify that this and the preceding [60] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
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MS J TOOHEY, SENIOR MEMBER
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