FHK (Review Enduring Powers) - [2011] TASGAB 18

GUARDIANSHIP AND ADMINISTRATION BOARD
LAUNCESTON

FHK – Application to review an enduring power of attorney by the Public Trustee

FHK (Review Enduring Powers) [2011] TASGAB 18

REASONS FOR DECISION

Anita Smith (President)
Susan Hill (Member)
Rowena Holder (Member)

Date of hearing: 14 July 2011

Enduring powers of attorney – attorney with potential conflict of interests – whether donor can make a Testator’s Family Maintenance Act claim from her deceased husband’s estate – donor’s wishes – alternatives to appointing an administrator

Powers of Attorney Act 2000 section 33
Guardianship and Administration Act 1995 section 6
Testator’s Family Maintenance Act 1912 section 3

FHK was the donor of an enduring power of attorney executed on 13^th April 2005 appointing the Public Trustee as her attorney. She is 73 years of age and lives in secure “high care” residential aged care. Her late husband, SCK died on 18 September 2010. His will appointed the Public Trustee as his executor and obtained Probate on 4 May 2011. The Public Trustee has brought this application because of perceived conflict of interest arising from the terms of the will which leaves all of the late SCK’s estate to his two daughters. Their concern is that if the donor has a potential claim under the Testator’s Family Maintenance Act 1913 (‘TFM claim’) they cannot adequately represent both estates.
The hearing was scheduled for 14 July 2011. The following parties were given notice of the hearing:
The donor
The Public Trustee
TCK (daughter)
XT (daughter)
The Public Guardian
The Public Guardian was given notice of the hearing as a potential administrator given that all other parties had a conflict of interest and would not be eligible for appointment under section 54(1)(d)(ii) of the Guardianship and Administration Act 1995.
The donor was not capable of attending the hearing. Unfortunately, due to an administrative error, a request by the donor’s daughters to join the hearing by telephone was overlooked. Therefore attendance at the hearing was limited to the Public Guardian and the Public Trustee. The Board had the following documents available to it:
Application dated 9 June 2011
Enduring Power of Attorney registered number PA43324
Letter from Dr Frank Brunacci dated 1 March 2011 confirming the donor’s loss of capacity
Report by GAB Investigator
Email dated 30 June 2011 from the Public Trustee confirming the assets in the donor’s estate
Will of the late SCK dated 20 July 2010
Inventory of the estate of the late SCK prepared April 2011
At the hearing it was confirmed that:
·The donor has, by survivorship, taken possession of a formerly joint bank account with a value of approximately $265,000.00.
·She receives an RBF pension but some details of this were still to be confirmed by the Public Trustee
·The donor’s only outgoings were the fees for the nursing home and limited pharmacy costs
·The estate of the late SCK of roughly similar value, being approximately $305,000.00
·The donor’s family members, while keen to have the matters settled, have supportive and settled relationships with each other
In considering the application, the Board must perform its duties by ensuring that:
(a)the means which is the least restrictive of the donor's freedom of decision and action as is possible in the circumstances is adopted, and
(b)the best interests of donor are promoted, and
(c)the donor’s wishes are, if possible, carried into effect.
The Board considered that this application does not impact particularly upon the donor’s freedom of decision and action. She has limited needs and wants at this time and those which she has are more than adequately covered by her income and the funds in her bank account. Her freedom of decision and action are not hindered by a lack of funds but by her physical and mental incapacity.
The donor is not capable of expressing wishes with regard to this application. However, the appointment of the Public Trustee as her enduring attorney is a demonstration of her wishes. Noting that the enduring power appointed the Public Trustee with plenary powers as attorney, and noting the provisions in section 53 of the Guardianship and Administration Act 1995, the Board considered that it could not appoint an administrator limited to investigating a TFM claim without revoking or suspending the enduring power of attorney which would be contrary to her demonstrated wishes.
In previous cases, the Board has appointed the Public Guardian as administrator in cases where the Public Trustee has a conflict. The difficulty in this is that the Public Guardian has no capacity to handle funds on behalf of a represented person. Therefore to undertake transactions, the Public Guardian retains the services of the Public Trustee to administer funds. It is an awkward and not terribly satisfactory arrangement, so fraught with cumbersome legal fictions that it ought to be avoided wherever possible. Therefore, the Board considered that avoiding the appointment of an administrator was in the donor’s best interests and reflective of her wishes.
The Board’s duty to promote the donor’s best interests require the Board to consider that if she has an entitlement, or a likely entitlement, to a part of her late husband’s estate, that such entitlement is not wasted.
The Board noted the views of the other beneficiaries that perhaps the late SCK had meant to leave more to his daughters and had misunderstood the operation of rules of survivorship in the joint account. The Board took the view that it was very likely that, as testator, the late SCK was fully cognisant that his wife would be fully provided for with the funds in the joint account and the RBF pension. The Board also took the view that it is highly likely that the donor’s representatives would have difficulty establishing in Court that she had been left without adequate provision for her proper maintenance and support. Therefore a TFM claim may be futile. However the Board does not have jurisdiction to determine such matters and it would not be in the donor’s best interests to make such a determination without the advantage of advice from suitably qualified counsel.
The Board suggested the following resolution to the Public Trustee, who accepted the proposal: To ensure that the donor’s wishes in appointing an enduring power of attorney are not disturbed, but to also ensure that her best interests are investigated and promoted, the Board would direct the Public Trustee to immediately seek independent legal advice as to the prospects of success of a TFM claim by the donor against her late husband’s estate. Once advice was obtained by the attorney it would be submitted to the Board for a further direction from the Board about whether an administrator needs to be appointed to pursue a TFM claim or whether the attorney/executor can proceed to distribute the estate to the nominated beneficiaries without the need for a TFM claim.
The Board considered this approach to be the most expedient. The parties at the hearing agreed. The Public Trustee indicated that it was eager to finalise the estate as quickly as possible. The Public Trustee sought 6 months in which to obtain a legal opinion so that there would be sufficient time to finalise the income details from RBF, submit materials for legal opinion and receive a response.

After hearing an application in relation to an Enduring Power of Attorney (PA43324) dated 13th April 2005 (hereinafter ‘the power’) made by FHK (hereinafter ‘the donor’) appointing The Public Trustee as her attorney (hereinafter ‘the attorney’)

THE BOARD DIRECTS that the attorney seek independent legal advice on behalf of the donor regarding a possible Testator’s Family Maintenance claim and submit the advice to the Board within 6 months. The Board will then issue further advice and direction to the attorney.

ANITA SMITH SUSAN HILL ROWENA HOLDER
PRESIDENT MEMBER MEMBER