FMM - [2005] WASAT 102

JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL

STREAM: HUMAN RIGHTS

ACT: GUARDIANSHIP AND ADMINISTRATION ACT 1990

CITATION: FMM [2005] WASAT 102

MEMBER: MR J MANSVELD (MEMBER)

HEARD: 18 FEBRUARY 2005

DELIVERED : 13 MAY 2005

FILE NO/S: GAA 87 of 2005

BETWEEN: FMM
Applicant

Catchwords:

Guardianship and administration - Enduring power of attorney - Application for intervention - Validity of enduring power of attorney - Substitute donee

Legislation:

Guardianship and Administration Act 1990 (WA), s 4, s 13, s 64, s 104 s 106, s 107, s 109

Result:

SD is appointed substitute donee for HVN (deceased) so that the donee of the power now reads as KR and SD as joint and several attorneys
The application for administration is dismissed

Category: B

Representation:

Counsel:

Applicant: Self Represented

Solicitors:

Applicant:

Case(s) referred to in decision(s):

Re CH, unreported decision of the Full Board delivered 8 May 2003 (Mr K Chapman, President, Ms P Eldred, Deputy President and F Child, member)

Case(s) also cited:

Nil

MR J MANSVELD (MEMBER)

REASONS FOR DECISION

Introduction

KR, greatniece of FMM, has filed two applications with the Tribunal. The first, filed on 17 January 2005, is an application for the Tribunal to intervene into an enduring power of attorney. The second, filed on 1 February 2005, is an application to have an administrator appointed for FMM.
The Tribunal heard these applications on 18 February 2005 and reserved its decision.

Background

FMM had executed an enduring power of attorney on 28 March 1993 appointing HVN and KR as her joint and several attorneys.
KR gave evidence that HVN had died on 9 November 2002 and that when the need arose she had acted as the sole surviving attorney. KR is currently intending to live in Canada for three years because of her husband's work commitments and is proposing that SD, a niece of FMM, be substituted for the late HVN. This, according to KR, would allow a suitable person in Western Australia to undertake the practical tasks of managing the estate and would retain the authority and interest of KR in FMM's financial affairs.
KR has brought the application for administration to the Tribunal in case the intervention application is not successful and an order for administration is required. After some discussion at the hearing about how an administration order might be structured, KR supported by SD, proposes that she and SD be appointed joint plenary administrators.

Capacity

In the applications before it the Tribunal has first to be satisfied that FMM is someone for whom orders could be made. The application for intervention into the enduring power of attorney has been made pursuant to s 109(1)(c) of the Guardianship and Administration Act1990 (WA) (the Act). That section does not speak directly to capacity but at s 13(g) of the Act the functions of the Tribunal includes "certain jurisdiction in relation to powers of attorney that operate after the donor has ceased to have legal capacity". As for administration and the question of a person's capacity, the Tribunal needs to be satisfied that FMM "is unable, by reason of a mental disability, to make reasonable judgements in respect of matters relating to all or any part of his estate" (s 64(1)(a) of the Act). At s 3 of the Act, "mental disability" includes an intellectual disability, a psychiatric condition, an acquired brain injury and dementia.
The Tribunal has before it a report from Dr JH dated 3 February 2005 which states that FMM suffers from "Alzheimers Dementia", first recognised by the medical practitioner in September 2002 and which is a progressive condition. FMM is said to be incapable now of making reasonable decisions in relation to her financial affairs and is considered not now to be capable of executing a valid enduring power of attorney.
The Tribunal has also been provided with a report from LA, Registered Nurse and manager of the aged care hostel in which FMM resides. Amongst other things LA states in her report that FMM "has very poor short term memory" and a "lack of insight into her own abilities and needs".
In her application for administration and in oral evidence at the hearing KR confirmed that FMM has very limited short-term memory and has "no recollection of her financial or medical conditions".
On the evidence before it the Tribunal is satisfied that FMM is no longer of "legal capacity" and also satisfies the requirements of s 64(1)(a) of the Act.

Application for intervention into the enduring power of attorney

In dealing with the application for intervention into the enduring power of attorney, several questions need to be considered. Firstly, is the enduring power of attorney executed by FMM on 28 March 1993 in the form that is contemplated by Pt 9 of the Act. Secondly, and if the first question is answered in the affirmative, would appointing SD as substitute attorney for the late HVN be in FMM's best interests and reasonably conform to what her wishes would be should she be able to express them directly or indirectly from what can be gathered from her past actions (s 4 of the Act).
The question of the "form" of an enduring power of attorney was considered by the former Guardianship and Administration Board in Re CH, unreported decision of the Full Board delivered 8 May 2003 (Mr K Chapman, President, Ms P Eldred, Deputy President and F Child, member). The decision by the Full Board was made pursuant to an application under s 106 of the Act where the applicant was applying for a declaration by the Board that CH did not have legal capacity. Such a declaration by the Board would have enabled the enduring power of attorney to come into force.
The Full Board firstly took the view that the Act did not vest it with the authority to declare whether or not an enduring power of attorney is valid. The Board considered, however, that the Act obliged it to be satisfied that the enduring power of attorney conformed with the requirements of the Act before it could reasonably make orders in respect of it.
Section 106 of the Act refers to s 104 which sets out the basic requirements of an enduring power of attorney. It reads:-
"104. Execution of enduring power of attorney
(1)An enduring power of attorney may be created by instrument ¾
(a)that is in the form or substantially in the form of Form 1 in Schedule 3; and
(b)in which the donor of the power declares that the power either ¾
(i)will continue in force notwithstanding his subsequent legal incapacity; or
(ii)will be in force only during any period when a declaration by the State Administrative Tribunal under section 106 that the donor does not have legal capacity is in force.
(2)An instrument is not effective to create an enduring power of attorney unless ¾
(a)there are 2 attesting witnesses to the instrument and both of them are persons authorised by law to take declarations; and
(b)the instrument has endorsed on it, or annexed to it, a statement of acceptance in the form, or substantially in the form, of Form 2 in Schedule 3 executed by ¾
(i)the person or persons appointed to be the donee of the power; and
(ii)where applicable, the person or persons appointed to be the substitute donee of the power."

The document in Re CH (supra) was determined not to comply with s 104(1)(b) and on that point alone was considered not to be an enduring power of attorney made pursuant to the Act.
The Full Board went further and determined that the document did not comply with the provisions of s 104(1)(a) of the Act and described three defects, firstly the failure on s 104(1)(b); secondly, the document did not comply with the provisions of s 107 of the Act because it permitted the donees to renounce their legal position during the legal incapacity of the donor and lastly the document did not comply with the provisions of s 109(1)(c) in that it purported to give the donees the authority to appoint other people in their place. Both s 107 and s 109 give only the Board the authority to make such determinations when a person has lost legal capacity.
The Full Board said:
"We are of the view that in most cases, if not all, where a purported enduring power of attorney contains provisions contrary to the provisions of the Act it cannot be said that the document is in the form of or substantially in the form of Form 1 so as to come within s 104(1)(a) of the Act."
The decision in Re CH (supra) is not binding on this Tribunal but it's reasoning does provide a reference point by which the matter before the Tribunal can be considered.
With regard to the document executed by FMM on 28 March 1993, it complies with s 104(1)(b) and s 104(2). It is to continue in force notwithstanding the subsequent legal incapacity of FMM (s 104(1)(b)(i)), it is witnessed by two authorised persons and it has an appropriate statement of acceptance by the donees (s 104(2)). Unlike the Form 1 in Schedule 3 to the Act, the document lists the powers available to the donees rather than authorizing the donees to do anything on behalf of FMM that can lawfully be done by an attorney subject to any conditions or restrictions (clauses 2 and 3 of Form 1). I do not think that by itself renders the document not in the form or substantially in the form of Form 1 in Schedule 3 as required by s 104(1)(a) of the Act.
There is, however, one clause of the document executed by FMM on 28 March 1993 which bears closer examination. Clause 18 purports to allow the attorneys to appoint and remove substitute attorneys. It reads:
"To appoint and remove substitutes- To appoint and remove any substitute for or agent under my said Attorneys in respect of all or any of the matters aforesaid upon such terms as my said Attorneys shall think fit."
On the face of it this clause would appear to be of the type of which the Full Board in Re CH (supra) was concerned. There are, however, several aspects of the matter before this Tribunal which differ from the facts in Re CH.
Firstly, in that case the Board considered the document to be inconsistent with the Act in a number of significant respects. Not only did it fail on the requirements of s 104(1)(b) alone but it also failed on the provisions of s 107, a statutory requirement that a breach of which is made an offence and lastly it purported to give the donees the power to appoint and remove substitutes contrary to the provisions of s 109(1)(c). Secondly, the document before the Board had not yet come into force and therefore was not in danger of putting in jeopardy acts done and decisions made by the donees. KR gave evidence that she had acted as attorney for FMM since the latter had lost legal capacity and recently had used her authority to dispose of FMM's property. For that purpose the document had been lodged with the Department of Land Information and therefore accepted by that agency as being valid for the purposes of the attorney registering the transfer of land.
It is fair to say that the Act, as it makes provision for enduring powers of attorney, attempts to balance the need for protection for a person once they have lost capacity, with acknowledging and respecting the autonomous acts of the capable person when entering into a private agreement that provides for the ongoing management of their estate when capacity is lost.
It is not clear from its decision that the Full Board in Re CH (supra) would have struck down the entire document for want of not complying with s 109(1)(c). In the present case the document executed by FMM otherwise complies with the fundamental requirements of Pt 9 of the Act and has been used by KR as attorney to amongst other things, dispose of FMM's property in the normal course of managing her estate.
I am satisfied that the facts in this case are sufficiently different from those in Re CH (supra) and therefore find that the enduring power of attorney executed by FMM on 28 March 1993 is substantially in the form of Form 1 so as to come within s 104(1)(a) of the Act.
The question that follows is what would now be in FMM's best interests. When FMM made the enduring power of attorney she appointed KR and HVN as her joint and several attorneys. Making the appointment in this way was an acknowledgement that the attorneys might act, as the need arose, independently of one another. If FMM had not wanted this she could have had KR and HVN act jointly, then upon the death of HVN the document would have become inoperable. In that situation when FMM became incapable some other arrangement would have been necessary, most likely the appointment of an administrator. Given the joint and several nature of the document, however, KR was able to continue acting as attorney and to make important financial decisions for FMM. The proposal to now add a person known by FMM and others close to her to enable KR to retain an authority and interest in the management of her financial affairs whilst overseas, would seem consistent with the intent of the initial arrangement. That is, FMM wanted her estate managed by way of a private arrangement, jointly and severally with KR being one of the attorneys. The unfortunate death of HVN and the need for KR to travel overseas entails the need to make a practical adjustment to enable the enduring power of attorney to continue.
The Tribunal is satisfied that appointing SD as substitute donee for the late HVN is in FMM's current best interests.

The application for administration

Having decided the application for intervention into the enduring power of attorney in this way, the application for administration is not required so it is further ordered that the application be dismissed.

Decision

The Tribunal orders that SD, niece of FMM, be appointed as substitute donee for HVN (deceased) so that the donee of the power of the enduring power of attorney executed on 28 March 1993 reads as KR and SD as joint and several attorneys. The application for administration is dismissed.

I certify that this and the preceding 8 pages comprise the reasons for decision of the State Administrative Tribunal.
_____________________________
Mr J Mansveld
Member