EBF and DMW
[2008] WASAT 236
•10 OCTOBER 2008
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL
STREAM: HUMAN RIGHTS
ACT: GUARDIANSHIP AND ADMINISTRATION ACT 1990 (WA)
CITATION: EBF and DMW [2008] WASAT 236
MEMBER: MR J MANSVELD (MEMBER)
HEARD: DETERMINED ON THE DOCUMENTS
DELIVERED : 10 OCTOBER 2008
FILE NO/S: GAA 279 of 2008
BETWEEN: EBF
Applicant
AND
DMW
Respondent
Catchwords:
Guardianship and administration - Application for legal costs to be paid from the represented person's estate - Principle that parties bear their own costs - That principle may be overturned in certain circumstances - Applicant in a position not dissimilar to the majority of applicants who appear before the Tribunal - Applicant entitled to legal representation to protect her own interests - Application dismissed
Legislation:
Guardianship and Administration Act 1990 (WA), s 16, s 16(4), s 97(1)(b)
Guardianship and Administration Act 2000 (QLD), s 82, s 127
State Administrative Tribunal Act 2004 (WA), s 5, s 9, s 32(1), s 32(2), s 32(4), s 35, s 87
Result:
The application is dismissed
Category: B
Representation:
Counsel:
Applicant: N/A
Respondent: N/A
Solicitors:
Applicant: N/A
Respondent: N/A
Case(s) referred to in decision(s):
A and ES [2005] WASAT 279
GD and AD [2005] WASAT 203
ReELF [2004] QGAAT 57
Re ERF [2005] QGAAT 62
REASONS FOR DECISION OF THE TRIBUNAL:
Summary of Tribunal's decision
The daughter of an elderly woman (now deceased) made an application for her legal costs to be paid from the woman's estate.
The daughter had applied to the Tribunal for a guardian and administrator to be appointed for the woman. The daughter and her brother were in disagreement about the management of the woman's estate which had lead to the bank accounts of the woman being frozen.
In all the circumstances of the case, it could not be said that the legal assistance obtained by the daughter justified her legal costs being paid from the woman's estate. In respect of the proceedings she was in a position not dissimilar to the majority of applicants and parties that appear before the Tribunal without legal assistance.
Although the daughter had every right to seek legal advice to protect her interests, it was not considered necessary to the final determination of the Tribunal which was to make a decision in the best interests of DMW.
In dismissing the application for costs, the Tribunal took the view that it should not depart in this case from the principle that parties bear their own costs in proceedings.
Background
These reasons relate to an application for costs under s 16(4) of the Guardianship and Administration Act 1990 (WA) (GA Act). The costs (legal fees) were incurred in the proceedings of guardianship and administration for DMW.
The application for costs has been made by EBF, daughter of DMW and applicant in the guardianship and administration proceedings.
EBF is asking that her legal fees of $1,693 be paid from the estate of DMW.
At the time of the hearing for the guardianship and administration applications, DMW was a woman of 84 years of age and living with EBF.
DMW passed away after the application for costs was made.
The applications for guardianship and administration
The applications for guardianship and administration were heard by the Tribunal on 13 March 2008. EBF attended the hearing as did her brothers, MFW and DAW. EBF was legally represented.
There was no dispute that DMW was a person for whom guardianship and administration orders could be made. She had been suffering from dementia for a number of years and the Tribunal had before it a number of reports from medical practitioners who had assessed her as incapable of caring for herself or making reasonable judgments about her person and estate.
It was common ground that EBF had been caring for DMW for 20 years or so and that she continue to do so for as long as possible. She was being assisted in the care of her mother by DAW.
A concern was raised by MFW that he could not get to see his mother at the home of EBF because of a disagreement about the way her finances were being managed by EBF. This matter was resolved by an agreement that MFW would visit his mother at the home of his brother.
As it transpired the Tribunal appointed EBF as DMW's limited guardian with the function of consenting to her treatment and health care. There was no opposition to the appointment.
MFW had raised concerns about the management of his mother's finances, alleging that expenditure had been made from her funds by EBF that he believed might not have been for her benefit. He pointed to a number of significant withdrawals from the bank account of DMW over a period of years which he said required explanation.
DMW had, on 4 May 2007, (at the initiation of MFW), executed an enduring power of attorney appointing MFW and EBF as joint and several attorneys. MFW had accepted the appointment but not so EBF.
Because of the dispute between MFW and EBF about the management of their mother's finances, DMW's bank had frozen her accounts awaiting the outcome of the Tribunal proceedings in respect of administration.
EBF had stated that DMW's estate comprised of her entitlement to the age pension and about $17,000 in bank funds. Of those funds $10,000 had been set aside for DMW's eventual funeral costs and the balance was in an operating account.
EBF submitted that the age pension was a modest amount and it could not be expected that DMW would accumulate much funds after payment for her share of living expenses. Despite this, a not insignificant amount of funds had been saved.
EBF stated that she had taken DMW on regular overseas holidays to visit her family and that DMW had paid for her own costs and had also provided gifts to family members.
EBF stated that she did not systematically withdraw funds from her mother's bank account for her share of living expenses but would from time to time withdraw a lump sum to cover a particular period of time.
MFW submitted that DMW's financial needs were not large and that funds had only accumulated since he had become involved to make EBF accountable for the management of DMW's funds.
EBF proposed herself as the administrator for her mother. MFW proposed the appointment of the Public Trustee. DAW supported EBF's appointment.
Another son of DMW, who lives outside of the State, supported the ongoing care of his mother by EBF and DAW.
MFW made a final submission that an administration order include an ex gratia payment from DMW's estate to assist in the medical treatment of his seriously ill daughter. EBF and DAW supported the submission and an amount of $3,000 was proposed.
The Tribunal decided to appoint EBF as the plenary administrator of the estate of DMW. Because of the disagreement about the amount of board and lodging that DMW should pay, the administrator was directed to make contact with the Public Trustee (to whom administrators are required to submit annual accounts), to seek advice on the appropriate amount to charge DMW for board and lodging whilst she continued to live with EBF.
The enduring power of attorney executed by DMW on 4 May 2007 was revoked.
The Tribunal authorised the administrator to make an ex gratia payment of up to $3,000 for the medical expenses of DMW's granddaughter (the daughter of MFW).
The claim for costs
In her application for costs, EBF states that she was 'forced' to make the application for administration as she was having major problems with a brother (MFW) who '… illegally obtained power attorney (sic) to handle my mother's affairs (which was cancelled during the hearing on 13 March 2008) which lead to my mother's bank accounts being frozen by the bank.'
EBF stated further:
Due to the various threats from my brother and ignorance of these issues I retained a lawyer to assist me during the process which has cost me A$1693.00 …
I would like to be reimbursed for the above amount as I do not think it is fair that I should be penalised for caring for my mother for the last 19 years.
The discretion as to costs
The jurisdiction to make an order for costs in the matter before the Tribunal is found in the State Administrative Tribunal Act 2004 (WA) (SAT Act) and the GA Act. If the two acts are in conflict, the enabling Act prevails (s 5 of the SAT Act).
Section 87 of the SAT Act states:
Costs of parties and others
(1)Unless otherwise specified in this Act, the enabling Act, or an order of the Tribunal under this section, parties bear their own costs in a proceeding of the Tribunal.
(2)Unless otherwise specified in the enabling Act, the Tribunal may make an order for the payment by a party of all or any of the costs of another party or of a person required to produce a document or other material on the application of the party under section 35.
(3) The power of the Tribunal to make an order for the payment by a party of the costs of another party includes the power to make an order for the payment of an amount to compensate the other party for any expenses, loss, inconvenience, or embarrassment resulting from the proceeding or the matter because of which the proceeding was brought.
(4) Without limiting anything else that may be considered in making an order for the payment by a party of the costs of another party where the matter that is the subject of the proceeding comes within the Tribunal's review jurisdiction, the Tribunal is to have regard to
(a)whether the party (in bringing or conducting the proceeding before the decision-maker in which the decision under review was made) genuinely attempted to enable and assist the decision-maker to make a decision on its merits;
(b)whether the party (being the decision-maker) genuinely attempted to make a decision on its merits.
(5)The rules may deal with the effect of certain offers to settle, and responses, if any, to the offer, on the making of an order for the payment by a party of the costs of another party.
(6)The Tribunal may order that the representative of a party, rather than the party, in the representative's own capacity compensate that or any other party for costs incurred because the representative acted in, or delayed, the proceeding in a way that resulted in unnecessary costs.
Section 16 of the GA Act states:
Costs
[(1)repealed]
(2)Where a person gives evidence or information
(a)at the instigation of the State Administrative Tribunal; or
(b)at the instigation of a party and the State Administrative Tribunal considers that the circumstances are exceptional,
the Tribunal may approve payment to him of such amount as it thinks fit in or towards defraying any costs and expenses incurred by him in doing so, and an amount so approved shall be paid from moneys appropriated by Parliament for that purpose.
[(3) repealed]
(4)The State Administrative Tribunal may, if it is satisfied that a party to proceedings commenced under this Act has acted in the best interests of the represented person or a person in respect of whom an application is made, order that such costs relative to those proceedings as the State Administrative Tribunal thinks fit be paid to that party by, or out of the assets of, that person.
(5)Nothing in this section limits any other power of the State Administrative Tribunal under the State Administrative Tribunal Act 2004.
The decision to make an order for costs is ultimately at the discretion of the Tribunal.
In respect of a costs application under s 16(4) of the GA Act, it might be argued that the requirement that a party act in the person's best interests is not a difficult threshold to cross. For the most part, parties act in what they believe to be in the best interests of the person for whom an application has been made. This could include the applicant and any other party who has the wellbeing of the person at heart and contributes in a helpful and positive way to the proceedings.
To read s 16(4) of the GA Act in this way, however, is to raise the possibility of an open-ended approach to awards of costs from the estate of a person for whom the GA Act applies which, in my view, is not the intent or scope of that section. The general discretion under s 16(4) should not be used independently of the cost regime provided for in the SAT Act and the overarching principle that parties bear their own costs. Section 16(4) should be read in light of the relevant provisions of the SAT Act.
In the sense that costs represent the legal costs of a party, the relevant question for the Tribunal to consider is under what circumstances is it appropriate for a party to seek legal advice and representation in contemplation of seeking recovery of costs against the estate of a represented person or a person for whom an application has been made (proposed represented person).
It is of course the right of any party to seek legal advice and representation in proceedings under the GA Act. When does a situation arise, however, when those costs are appropriately borne by the proposed represented person's estate?
In the answer to that question, consideration must first be given to the environment in which the Tribunal operates.
Section 9 of the SAT Act sets out the main objectives of the Tribunal. They are to achieve the resolutions of questions, complaints or disputes, and to make review decisions, fairly and according to the substantial merits of the case; to act as speedily and with as little formality and technicality as is practicable, and to minimise the costs to parties; and to make appropriate use of the knowledge and experience of Tribunal members.
The Tribunal is not bound by the rules of evidence and is to act according to equity, good conscience and the substantial merits of the case without regard to technicalities and legal forms (s 32(2) of the SAT Act). The Tribunal may inform itself on any matter as it sees fit (s 32(4) of the SAT Act) and is bound by the rules of natural justice (s 32(1) of the SAT Act).
The above are commonly described as representing the inquisitorial character common to tribunals. Factors which are said to signify this inquisitorial character include: a duty to inquire, the ability to inform itself, the power to compel the production of witnesses and documents, the discretion to determine its own procedure, the informality of the hearings, the absence of the obligation to abide by the rules of evidence, the requirement to provide fair process, the ability to make a decision on the papers, the need for the proceedings to be reasonably prompt, the absence of the burden of proof on the parties, the requirement for the standard of proof that the tribunal be satisfied as to its decision and the absence of legal representation for parties and their right to selfrepresentation ('Inquisitorial Processes in Australian Tribunals', Narelle Bedford and Robin Creyke, The Australian Institute of Judicial Administration Incorporated: March 2006: 15).
The Tribunal aims to make proceedings as accessible as possible to the parties (see, for example, the Tribunal's Practice Note 9 'Proceedings under the Guardianship and Administration Act 1990'). Legal representation is not usually required at hearings of the Tribunal in the GA Act jurisdiction because the information necessary to make a determination is generally secured by the application and hearing processes alone. In the GA Act jurisdiction moreover, the Tribunal is able to refer an application to the Public Advocate for independent investigation, report and advocacy in the best interests of the person for whom the application is made (s 97(1)(b) of the GA Act).
Another important aspect of the environment in which the Tribunal operates in the GA Act jurisdiction is that the proceedings are not in the nature of a civil dispute between parties (although there may be conflict between parties), but rather the most common question to be decided is whether the person the subject of the application is in need of a substitute decision-maker; a guardian for personal decision-making and an administrator for financial decision-making. The focus of the proceedings is the best interests of that person, and if there is conflict or differing opinions, then it is generally about matters such as the facts of the application, the person's capacity and/or the suitability of proposed guardians and administrators. There may also be situations where a party will wish to respond to adverse allegations made by another party.
This being the case, those aspects of the common law in civil disputes that refer to the principle of the 'cost following the event' are of limited application.
What relevance does all of this have to an application for costs under s 16(4) of the GA Act? The starting position is that a person should be able to make an application for guardianship and administration under the GA Act for another person without legal representation, with a reasonable belief that the Tribunal's processes as they play out in the GA Act jurisdiction enable a best interests determination to be made. Even if such a determination cannot be made at a first hearing, the Tribunal can adjourn to seek further information from the parties, third parties (s 35 of the SAT Act) or the Public Advocate.
It is nevertheless the case that the GA Act contemplates the possibility of an order for costs from the estate of a proposed represented person. If the above reasoning is correct, then the circumstances in which such an order is likely to be made would be when an application falls outside the area of expectation that the Tribunal, by the inquisitorial nature of its proceedings, is able to make a correct and preferable decision in the best interests of the person under disability, without parties requiring professional legal input. Given what I have described above as the Tribunal's processes, those circumstances should occur infrequently.
The decided cases are few. In GD and AD [2005] WASAT 203, the Tribunal, in deciding not to approve the payment of legal costs from the estate of the represented person, found that the 'good intentions' of the parties seeking costs was insufficient reason to make an order. In exercising its discretion, the Tribunal considered the following at [69]:
•the question of the represented person's capacity was not at issue;
•there was no 'real complexity' in the represented person's estate; and
•the conflict between the parties seeking a costs order (two brothers) went beyond matters dealt with at the hearing.
In A and ES [2005] WASAT 279 (A and ES), the Tribunal made a costs order under s 16(4) of the GA Act because it was satisfied that the applications were made in the best interests of the represented person and '… [because of] the circumstances surrounding the revocation of the joint EPA, and the size and complexity of the estate' (A and ES) at [21]. The award of costs was for a 'reasonable amount for obtaining advice and being represented at the … hearing'. The Tribunal did not consider it appropriate to allow costs incurred ' … in negotiating with the other parties, and preparing for and attending the subsequent mediation and hearings' (A and ES) at [23].
The Tribunal found, with which I agree, that a party's financial ability to pay is not a relevant consideration under s 16(4) of the GA Act at (A and ES) (at [18]), and that a costs order under s 16(4) should not be influenced by the consideration of whether a party should be 'deterred' from making future applications as this can be dealt with under s 87 of the SAT Act (A and ES at [19]).
There is no exact equivalent to s 16(4) of the GA Act in other Australian jurisdictions. There is, however, a recently decided case by the Queensland Guardianship and Administration Tribunal in which legal costs were allowed from the estate of a represented person. The case, Re ERF [2005] QGAAT 62, (Re ERF) provides some insight into what factors might be taken into account when contemplating such a costs order.
Under s 127 of the Guardianship and Administration Act 2000 (Qld) (Queensland Act), each party must bear their own costs unless there are exceptional circumstances such that an applicant should pay an active party's costs and the costs of the Tribunal. In the departure from this regime in Re ERF, the Tribunal used its discretion under s 82 of the Queensland Act which allows it to make declarations, orders or recommendations or give directions or advice in relation to administrators [18].
In exercising its discretion to award costs, the Queensland Tribunal considered whether there was an obligation to use ERF's funds to reimburse the applicant for legal costs incurred.
In respect of this question, the Tribunal found that the application was complex with substantial conflict between the applicant daughter and son of ERF, the latter being his attorney for personal and financial matters until revoked by the Tribunal (Re ERF [8] and [22]). The level of conflict was ' … at the extreme end of the range normally experienced by the Tribunal in its work. Both parties' cases were enhanced at the hearing by presentation through legal representation' (Re ERF [7]).
The Tribunal found that in making the applications and bringing to the attention of the Tribunal the actions of the then financial attorney [the son], the applicant had conferred a significant benefit on ERF by having the son's appointment terminated. ERF had also been accorded a significant financial benefit as a consequence of the applications and Tribunal decision [the Tribunal had earlier found that there had been a diminution of ERF's estate while under the management of the son (see Re ELF [2004] QGAAT 57).
The applicant daughter was found to have secured no pecuniary advantage from the proceedings and in fact had put herself at financial risk in making the application (Re ERF [25], [26] and [29]).
It seems to me that what can be derived from the costs regime envisaged by the SAT Act and GA Act read together with the decided cases (although of variable relevance) is the articulation of a number of areas of consideration for the Tribunal when using its discretion in the making a determination under s 16(4) of the GA Act. This may include situations where:
•it is unlikely that an application would have been made to the Tribunal and the proposed represented person benefit from the protection of an order had not legal advice been sought by the applicant;
•there are serious allegations that the proposed represented person is suffering from abuse, and legal advice and representation is required to present a reasoned case to the Tribunal in a timely manner;
•conflict between significant parties is of such magnitude that it is unlikely they could present a coherent case to the Tribunal in respect of the history and needs of the proposed represented person without legal assistance;
•the application is of such complexity that legal advice and representation is required to present a reasoned case to the Tribunal in a timely manner;
•the application is contentious and unique, for example, sterilisation; and
•the application raises a special point of law.
These areas of consideration provide some guide to what 'best interests' might include in the context of a determination by the Tribunal under s 16(4) of the GA Act. They cannot, however, provide a fetter on the ultimate discretion of the Tribunal to make a decision about costs on the facts of the particular case.
Exercise of costs discretion in this case
I am not persuaded that the legal fees paid by EBF should be reimbursed from the estate of DMW.
At the time of making the application for administration (and guardianship) EBF was managing the estate of DMW without formal authority. She made the application because she was challenged by MFW about the management of her mother's funds.
Under those circumstances (and particularly because the bank accounts of DMW were frozen) it was appropriate for an application for administration to be made to the Tribunal so that formal authority could be given to someone to bring certainty to the decisionmaking and to be accountable to the Public Trustee for the expenditures made on behalf of DMW.
At the time of making the application, however, EBF was in a position not dissimilar to the majority of applicants who appear before the Tribunal. She was able to access the Tribunal in the way described above and as most applicants and parties do (and as MFW and DAW did in this case). (see 'The discretion as to costs')
Although EBF had every right to seek legal advice to protect her interests (as she did) it was not, in my view, necessary to the final determination of the Tribunal which was to make a decision in the best interests of DMW.
Although EBF was in conflict with MFW, I would not characterise it as in the extreme range of conflict that presents to the Tribunal and which is dealt with in the ordinary hearing process.
The estate of DMW was small and not complex.
I find that the application for costs should not succeed as the situation of the estate of DMW and its management did not correspond to the sort of circumstances I envisage were contemplated in the making of orders under s 16(4) of the GA Act.
In dismissing the application for costs, I have taken the view that I should not depart in this case from the principle that parties bear their own costs in proceedings.
Order
The application for costs be dismissed.
I certify that this and the preceding [69] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
___________________________________
MR J MANSVELD, MEMBER