ER and NR
[2015] WASAT 136
•7 DECEMBER 2015
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL
ACT: GUARDIANSHIP AND ADMINISTRATION ACT 1990 (WA)
CITATION: ER and NR [2015] WASAT 136
MEMBER: MR J MANSVELD (SENIOR MEMBER)
HEARD: 28 OCTOBER 2015
DELIVERED : 7 DECEMBER 2015
FILE NO/S: GAA 3804 of 2015
BETWEEN: ER
Applicant
AND
NR
Represented Person
Catchwords:
Guardianship and administration Administration Enduring power of attorney Public Trustee appointed as administrator Enduring power of attorney revoked Application to have applicant's costs paid from estate of represented person General principle that parties bear their own costs Applicant acted in the represented person's best interests Estate at some risk Costs allowed for legal advice and preparation of application
Legislation:
Guardianship and Administration Act 1990 (WA), s 16(4), s 65, s 97(1)(b)(iii), s 109(1)(a)
State Administrative Tribunal Act 2005 (WA), s 87
Result:
Partial costs order
Summary of Tribunal's decision:
Applications seeking the appointment of an administrator and intervention into an enduring power of attorney were made for an 87yearold woman by her daughter.
The woman had been diagnosed with dementia and had recently become a resident of a nursing home.
The woman had made an enduring power of attorney appointing her daughter and son as joint and several attorneys.
The son was managing her finances as attorney.
The daughter made the applications because she had become concerned at withdrawals totalling nearly $30,000 from the woman's bank account, those funds having been paid to a company under the control of the son.
The woman had substantial cash funds at her disposal.
The Tribunal made protective orders early in the proceeding and the Public Trustee, who had been given authority to secure the woman's estate, confirmed that payments had been made by the son to his company.
The Tribunal appointed the Public Trustee as the woman's plenary administrator and revoked the enduring power of attorney.
The daughter made an application for her legal costs of $3,200 to be paid from the woman's estate.
The Tribunal accepted that the daughter had acted in the woman's best interests but determined that it could not wholly depart from the general position of the Tribunal that parties bear their own costs.
The Tribunal accepted that the daughter had an understandable concern that the woman's funds were being misused by the son and that action had to be taken quickly to ensure that this was stopped.
Under the circumstances where the woman's estate was at some risk, the Tribunal accepted that it was reasonable for the daughter to seek legal advice and make application for the Tribunal's urgent intervention. The application and the supporting material assisted the Tribunal in the making of the early protective order.
The Tribunal decided, therefore, that the sum of $1,200 be paid from the estate of the woman to meet those legal costs incurred by the daughter in the initial stages of her endeavours to protect the woman's estate.
Category: B
Representation:
Counsel:
Applicant: Mr RJ Biddulph
Represented Person : N/A
Solicitors:
Applicant: Biddulph & Turley
Represented Person : N/A
Case(s) referred to in decision(s):
LC and JS [2007] WASAT 127
MB and EM [2014] WASAT 17
REASONS FOR DECISION OF THE TRIBUNAL:
Introduction
An application has been made for legal costs to be paid pursuant to s 16(4) of the Guardianship and Administration Act 1990 (WA) (GA Act).
Background
In August 2015, applications under the GAA Act were made in respect of NR (represented person), an 87‑year‑old woman who had been diagnosed with dementia (Alzheimer's disease) and who had been living in a nursing home from April 2015.
The applications were for the making of an administration order in respect to the represented person's estate and an application under s 109(1)(a) of the GA Act requiring the attorney of an enduring power of attorney (EPA) to file with the Tribunal and serve on the applicant a copy of all records and accounts kept by the attorney of dealings and transactions made in connection with the power.
The applications were made by ER, the daughter of the represented person.
The represented person had executed an EPA on 5 August 2014 appointing her son, JR, and ER as joint and several attorneys. It was alleged by ER that JR was inappropriately managing the represented person's estate and had excluded her from any involvement in the represented person's financial affairs since she was placed in the nursing home.
In her application, ER raised concerns about payments totalling approximately $28,000 made from the represented person's bank account in the period 11 March to 14 August 2015. These payments had been made to the bank account of a company controlled and operated by JR. ER also alleged that cash withdrawals in the period 25 August 2014 to 24 July 2015, totalling about $8,500, were not made in respect of the represented person. ER also questioned an investment decision totalling $50,000 made by JR for the represented person, ER submitting that it was not an investment the represented person would have made.
On 1 September 2015, the Tribunal made orders referring the applications to the Public Advocate for investigation pursuant to s 97(1)(b)(iii) of the GA Act. The Tribunal also ordered that the attorneys, under the EPA, provide a statement of the represented person's assets and liabilities and her current regular income and expenditure.
On 1 September 2015, the Tribunal made an order under s 65 of the GA Act giving the Public Trustee the authority of a plenary administrator so as to protect and secure the represented person's estate.
The represented person's estate was conservatively valued in excess of $3,500,000, comprising the property in which the represented person had lived with JR and in which JR now lived alone (family home), a 'beach property', a motor vehicle, shares, a refundable accommodation deposit with the nursing home and bank funds of approximately $2,500,000. The represented person was the sole beneficiary of the estate of her late partner who died in 2010. JR had assumed administration of the estate of the late partner, which was not complete.
The hearing of the applications
The applications were heard on 28 October 2015. The hearing was attended by a representative of the Public Trustee, a representative of the Public Advocate, ER, who was legally represented, JR, and AR, another daughter of the represented person who lives overseas and who attended by telephone.
The Public Trustee, pursuant to the order made under s 65 of the GA Act, had investigated the extent of the represented person's estate and confirmed that payments from the estate of the represented person had been made to a company owned and controlled by JR amounting to $31,485.20. JR had submitted invoices totalling $33,685.24 for work on the family home described by him as painting preparation, high pressure cleaning of the under eaves, gardening work, rubbish removal and administrative work as attorney.
The Public Trustee expressed serious concerns about the invoices, the way they were raised and the work purportedly completed.
The EPA did not contain any agreement with the represented person concerning the right of the attorney to charge fees for his role as attorney.
JR stated that he had needed to give up his employment so that he could care for the represented person when she was still living in the family home and after her move to the nursing home, to manage her estate, which included maintaining the family home and the beach house. JR said that the cash withdrawals about which ER was concerned were principally made whilst the represented person was still living in the family home and were used for living expenses, given that the represented person was not in receipt of a social security income.
JR submitted that the represented person wanted to retain the family home because she believed she would return to live there and, in any case, she would want him to remain living there. He said, and this was accepted by ER, that he had not been required to pay rent or other expenses of the property when the represented person was still at home. He said that he continued to use the represented person's motor vehicle for matters associated with her.
The Public Advocate had interviewed the represented person who did not recollect making an EPA and remained of the view that she was capable of managing her own financial affairs. The Public Advocate had spoken with JR and he had advised that in 2013 and 2014 he could not work because the represented person became very dependent upon him for her care.
ER proposed the appointment of the Public Trustee as the administrator of the estate of the represented person and this submission was supported by the Public Advocate. ER submitted that in this way the estate would be managed by a specialist administrator and it would also assist to preserve the relationship she had with JR. The represented person had executed an enduring power of guardianship on 5 August 2014 appointing ER and JR as her joint guardians and this was not the subject of challenge.
JR did not oppose the appointment of the Public Trustee. JR said that although he admitted he had made some mistakes in the management of the represented person's estate, he had undertaken the work as attorney to the best of his ability and he believed he had acted in the represented person's best interests.
As regards the represented person's capacity, the reports available to the Tribunal stated that she had been diagnosed with dementia (likely Alzheimer's disease) in 2014 and that by January 2015 the dementia had progressed significantly. A consultant geriatrician had recommended in early 2015 that the family should give consideration to the represented person being accommodated in a nursing home.
The Tribunal decided that it was in the best interests of the represented person that the Public Trustee be appointed plenary administrator of her estate and that the EPA be revoked, given its inconsistency with the authority given to the Public Trustee. The Tribunal authorised the administrator to expend up to a total amount of $2,500 per annum on gifts on behalf of the represented person and also authorised the administrator, at its discretion, to allow JR to continue to live in the family property and to use the represented person's motor vehicle. The order was set to be reviewed in five years, being the maximum period allowable under the GA Act.
ER accepted that with the appointment of the Public Trustee as administrator of the estate of the represented person, the application under s 109(1)(a) of the GA Act was no longer required, on the basis that the Public Trustee could investigate the transactions of JR undertaken in his capacity as attorney of the represented person and take whatever action was considered necessary.
The application under s 16(4) of the GA Act
At the hearing on 28 October 2015, ER, by her counsel, foreshadowed an application for her legal costs to be paid from the assets of the represented person. JR said he was not opposed to a costs order in the form sought by ER.
ER filed written submissions in support of the application. The submission refers to what ER states are 'the principles guiding whether an order for costs ought to be made', which are set out in the decision of the Full Tribunal in MB and EM [2014] WASAT 17 (MB and EM) at [69].
ER submits that it was highly unlikely that any application would have been made to the Tribunal and the represented person thereby benefiting from the protection of an order, had not legal advice been sought by her. ER had made serious allegations of the misuse of the represented person's funds by JR in his role as attorney. Given these allegations, the application had been made on an urgent basis and the Tribunal had been given the benefit of an application and supporting documents which were comprehensive and readily identified the issues involved.
ER is seeking costs of $3,200 comprising:
•the preparation of the application and supporting documents ‑ $1,200;
•the perusal of materials filed by JR, the Public Trustee and the Public Advocate, and the preparation of the final submission ‑ $1,200; and
•the attendance of counsel at the Tribunal hearing ‑ $800.
ER submits that the costs are not disproportionate to the benefit obtained by the represented person by virtue of the application, and seeks the full costs or, in the alternative, the costs of preparing the application.
The decision of the Tribunal
Section 16(4) of the GA Act states:
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.
ER correctly refers to the decision of the Full Tribunal in MB and EM as a statement of the Tribunal's practice in respect of an application for costs under s 16(4) of the GA Act. The decision in MB and EM refers to DR Parry and B de Villiers Guide to Proceedings in the Western Australian State Administrative Tribunal (Law Book Co/Thomson Reuters, 2012) as a useful summary of the Tribunal's position, which I accept.
Relevantly, s 16(4) of the GA Act should not be read independently of the costs regime in s 87 of the State Administrative Tribunal Act2004 (WA), the starting position being that each party bears their own costs. The decision in MB and EM at [69] sets out a number of factors which may be useful as a starting point as to whether the Tribunal should exercise its discretion under s 16(4) of the GA Act. The factors outlined in MB and EM were first established in the decision of the Tribunal in LC and JS [2007] WASAT 127.
Importantly, in LC and JS at [57], the Tribunal said:
These areas of consideration [that is, the 'factors' restated in MB and EM] 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.
In all the circumstances I cannot support an order for all of ER's costs to be paid from the estate of the represented person.
The application for the appointment of an administrator was filed with the Tribunal on 27 August 2015 and, by 1 September 2015, the Tribunal had referred the application to the Public Advocate for investigation and an order under s 65 of the GA Act had been made. At that point (or very soon thereafter), the represented person's estate was subject to the protection of the s 65 order which itself required the Public Trustee to establish the extent of the represented person's estate and, in so doing, to investigate the transactions about which ER had raised concerns.
The Public Advocate was required to investigate whether the EPA was the appropriate instrument to manage the represented person's estate or whether it was in her best interests to have an administrator appointed. The Public Advocate was also asked to seek the views and wishes of the represented person (see above).
The use of the Tribunal's inquisitorial processes early in the proceeding meant that the Tribunal and the parties would have the benefit of independent investigations by public authorities ‑ namely, the Public Advocate and the Public Trustee. The material to be gained from the orders made by the Tribunal on 1 September 2015 would provide a strong foundation on which the Tribunal could proceed.
Despite this, I accept the submission of ER that she should be paid the costs of the preparation of the application.
I accept that ER acted in the best interests of the represented person.
I accept that at the time ER made the application for an administration order, she was aware of JR withdrawing relatively significant amounts from the estate of the represented person and paying those amounts to himself (through a company controlled by him) and that he was not responding to her requests for details of those payments. ER had an understandable concern that the represented person's funds were being misused by JR and that action had to be taken quickly to ensure that this was stopped.
Under the circumstances where the represented person's estate was at some risk, I accept that it was reasonable for ER to seek legal advice and make application for the Tribunal's urgent intervention. The application and the supporting material assisted the Tribunal in the making of the protective order on 1 September 2015.
I have therefore decided, based on the schedule of costs provided by ER, that the sum of $1,200 be paid from the estate of the represented person to meet those costs incurred by ER in the initial stages of her endeavours to protect the represented person's estate.
Orders
The Tribunal makes the following order:
1.The Public Trustee, as the administrator of the estate of [the represented person], pay to [ER] the sum of $1,200 by way of a contribution to the legal expenses incurred by her in the Tribunal proceedings in GAA 3804 of 2015 and GAA 3869 of 2015.
I certify that this and the preceding [39] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
___________________________________
MR J MANSVELD, SENIOR MEMBER
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