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GDR v EKR

GDR v EKR

Case [2012] NSWSC 1543 14 December 2012

Guardianship

Remuneration

Conflict of Interest

Interim Receiver and Manager

Financial Services Licence

Succession Law

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Supreme Court

New South Wales

Medium Neutral Citation: GDR v EKR [2012] NSWSC 1543
Hearing dates: 27 November 2012; and on papers in chambers
Decision date: 14 December 2012
Jurisdiction: Equity Division - Protective List
Before: White J
Decision:
Liberty to apply or restore the matter.

Catchwords: GUARDIANSHIP - defendant incapable of managing her affairs - application by father for appointment of private company as financial manager - private company not a trustee company - whether company requires a financial services licence - whether private manager should receive remuneration - whether private manager in position of conflict of interest and duty due to personal interest in investing defendant's assets in certain financial products - noted that relationship between protected person and manager under the scheme of the NSW Trustee and Guardian Act is that of principal and agent, not trustee and beneficiary, so legal title in protected person's property should not vest in manager - no orders made unless and until private manager obtains financial services licence - NSW Trustee and Guardian appointed interim receiver and manager
Legislation Cited: NSW Trustee and Guardian Act 2009 (NSW)
Corporations Act 2001 (Cth)
Cases Cited: Gell v Gell [2005] NSWSC 566; (2005) 63 NSWLR 547
G v B (Supreme Court of New South Wales, Powell J, 27 May 1992, unreported)
Holt v Protective Commissioner (1993) 31 NSWLR 227
JJK v APK (1986) Aust Tort Reports 80-042
Anson v Anson [2004] NSWSC 766; (2004) 12 BPR 22,303
Ex P Femor; In the matter of Errington (1821) Jac 404; 37 ER 903
Re Walker (1848) 2 Phil 630
Aberdeen Railway Co v Blaikie Bros (1854) 2 Eq Rep 1281; [1843-60] All ER Rep 249
Category: Principal judgment
Parties: GDR (Plaintiff)
EKR (Defendant)
Representation: Counsel:
H Stowe (Plaintiff)
M Heath (Ability One Financial Management)
Solicitors:
Matthews Folbigg (Plaintiff)

File Number(s): 2012/122431

Judgment

HIS HONOUR: This is an application for a declaration that the defendant, EKR, is incapable of managing her affairs and an order that her estate be subject to management pursuant to the NSW Trustee and Guardian Act 2009 (NSW). I am satisfied that in due course that declaration and order should be made.

EKR sustained injuries in a road traffic accident on 29 March 1999 when she was a young child. She commenced proceedings in the District Court in relation to the injuries she suffered. Those proceedings were resolved by way of a settlement that was approved by the District Court. EKR is entitled to settlement moneys in excess of $2 million. I am satisfied on the medical evidence that she is not capable of managing her affairs, nor capable of managing the ordinary routine affairs of man or woman.

The plaintiff is EKR's father. He also seeks an order that management of her estate be committed to Ability One Financial Management Pty Ltd ("Ability One Financial Management"). The issue on the application is whether that company should be appointed as financial manager. I have made an interim order appointing…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading GDR v EKR

Details

AGLC: GDR v EKR [2012] NSWSC 1543
Case: [2012] NSWSC 1543
Decision Date: 14 December 2012

CaseChat Overview and Summary

In this case, the father of the defendant applied for the appointment of a private company to manage his daughter's financial affairs. The daughter, who was found to be incapable of managing her own affairs, was represented by the public trustee. The dispute centred on the suitability of the private company as a financial manager, the necessity for the company to obtain a financial services licence, the issue of remuneration, and the potential conflict of interest arising from the private manager's personal interest in certain financial products. The court was required to determine whether the private manager was suitable and if any conditions should be imposed on the appointment.

The court held that the relationship between the protected person and the manager is that of principal and agent, not trustee and beneficiary, under the NSW Trustee and Guardian Act. Therefore, legal title in the protected person's property should not vest in the manager. The court also determined that the private manager would require a financial services licence and that no orders should be made unless and until the private manager obtained such a licence. The potential conflict of interest was noted, but the court did not make any orders at that time.

The court found that the private manager was not suitable for appointment as the defendant's financial manager until the company obtained a financial services licence and addressed the conflict of interest issue. The NSW Trustee and Guardian was appointed as the interim receiver and manager of the defendant's financial affairs. The court did not make any final orders at that stage, leaving the matter open for further application once the private manager had addressed the legal and conflict of interest issues.

Orders