HD
[2016] WASAT 37
•12 APRIL 2016
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL
ACT: GUARDIANSHIP AND ADMINISTRATION ACT 1990 (WA)
CITATION: HD [2016] WASAT 37
MEMBER: MR J MANSVELD (SENIOR MEMBER)
HEARD: 23 NOVEMBER 2015
DELIVERED : 12 APRIL 2016
FILE NO/S: GAA 4244 of 2015
BETWEEN: HD
Applicant
Catchwords:
Enduring power of attorney Jurisdiction of Tribunal does not stop on death of donor Applicant a person with proper interest in matter Applications not vexatious or frivolous Attorney transferred funds from donor to herself purportedly as partial reimbursement of monies expended Attorney required to produce records of transactions Records limited to those currently retained by attorney Considered too onerous to require attorney to seek further records because of transactions occurring from five to 13 years ago Audit of records kept by attorney would not materially add to information available on donor's estate
Legislation:
Guardianship and Administration Act 1990 (WA), s 107(1)(a), s 107(1)(b), s 109(1)(a), s 109(1)(b), s 109(1)(c)
Result:
Order made
Summary of Tribunal's decision:
HD made an enduring power of attorney in November 2002 appointing her daughter, BP as her sole attorney.
HD died in November 2010.
In September 2015, WS, a son of HD, made applications concerning the operation of the enduring power of attorney. WS applied for orders to have BP produce the records and accounts of transactions and dealings she undertook as attorney and to have those records audited.
The reason WS had applied for these orders was because he had only recently become aware of transactions occurring on the bank account of HD many years after her death.
BP said that she had subsidised the expenditure of HD over many years and just prior to HD's death had transferred a term deposit held in HD's name to a term deposit in the name of her and HD jointly.
BP was aware this meant that upon the death of HD, the term deposit would be owned by her. The amount in the term deposit was nearly $27,000.
After HD's death, BP admitted that she transferred a further $5,000 approximately to her account from the bank account of HD.
BP provided a financial statement that purportedly showed that she had subsidised HD's expenditure over the years in the amount of about $66,000. She maintained that the transfers to her bank account were only in partial repayment of her own funds she had expended on behalf of HD.
The way in which BP accounted for expenditure well after the event had invariably led to speculation of mismanagement that the applications before the Tribunal alleged.
Because of the uncertainty in the accounting of BP, the Tribunal decided on balance that she should be required to file with the Tribunal and give to the applicant a copy of the bank and other records she currently held in respect to the transactions she undertook as attorney of HD. She was not required to seek further records.
The Tribunal considered it onerous to require BP to seek records directly from the bank and vendors and service providers given that potentially they went as far back as November 2002. There was sufficient doubt whether if BP no longer has these accounts or receipts they could reasonably be expected to have been retained by the original parties.
Given the long time frame covered by the applications, the relatively small size of HD's estate, the admissions of BP as to the destination of the term deposit and other bank funds (the latter after the death of HD) and the information contained in the financial statement, the Tribunal was not convinced that an audit of the records BP was required to produce would materially add to the totality of information available on the estate of HD.
The application for an audit of the records and accounts was therefore dismissed.
Category: B
Representation:
Counsel:
Applicant: Nil
Solicitors:
Applicant: N/A
Case(s) referred to in decision(s):
BFO & Ors and KPW [2014] WASAT 68
EW [2010] WASAT 91
GA and EA and GS [2013] WASAT 175
Guardianship and Administration Act 1990 (WA)
KS [2008] WASAT 29
REASONS FOR DECISION OF THE TRIBUNAL:
Introduction
HD executed an enduring power of attorney (EPA) on 8 November 2002. She appointed her daughter, BP, to be her sole attorney.
HD died on 4 November 2010.
On 25 September 2015, WS, a son of HD, made the following applications in the Tribunal's original jurisdiction under the Guardianship and Administration Act 1990 (WA) (GA Act):
•an application under s 109(1)(a) of the GA Act requiring BP, as attorney under the EPA, to file with the Tribunal and serve on WS a copy of all records and accounts kept by BP of dealings and transactions made by her in connection with the EPA;
•an application under s 109(1)(b) of the GA Act requiring such records and accounts to be audited by an auditor appointed by the Tribunal and requiring a copy of the report of the auditor to be furnished to the Tribunal and WS; and
•an application under s 109(1)(c) of the GA Act revoking or varying the terms of the EPA, appointing a substitute attorney, or confirming that a person appointed to be the substitute attorney has become the attorney.
The hearing of the applications took place on 23 November 2015. The attendees were;
•WS (son and applicant);
•BP (daughter and former attorney under the EPA);
•DS (son);
•KS (daughter);
•EM (daughter); and
•other family members.
At the hearing it was conceded by WS that the application made under s 109(1)(c) of the GA Act was not relevant, given that the EPA had not operated since the death of HD.
The application under s 109(1)(c) of the GA Act was therefore dismissed.
The applications for determination were the ones made under s 109(1)(a) and s 109(1)(b) of the GA Act.
The decision was reserved.
The case presented by WS
WS states that when HD died in 2010 he believed she had died intestate and that she had little or no estate.
WS says that he took the matter of HD's estate no further, assuming that BP, as the former attorney, had done what was lawfully required.
Within the last 12 months, WS states that he had reason to make contact with BP and another sister, EM, in the context of a civil dispute in which they were engaged. In the course of that contact, he discovered that one of HD's bank accounts had been used for some years after her death.
WS says that the bank was not aware that HD had died on 4 November 2010, and after he produced the death certificate, he was given information regarding HD's bank accounts.
From the information provided by the bank, WS states that he determined that HD had had two bank accounts, a passbook account and a term deposit account (term deposit).
WS states that the term deposit of $26,987.98 was closed on 26 October 2010 and credited to HD's passbook account. On the same day, those funds were removed from the passbook account and credited to a new term deposit in the joint names of HD and BP.
Prior to the term deposit transactions, MS states that HD had a passbook account balance of $11,983.90.
WS states that on 9 November 2010, the sum of $8,000 was withdrawn from the passbook account, leaving a balance of $3,494.61. On 11 October 2010, the passbook account was credited with a pension payment of $716.10, and on 9 February 2011, with an amount of $1,066.50.
From March 2011 until September 2013, WS states that the only transactions on the passbook account were credits for interest. On 29 November and 4 December 2013, amounts of $650 and $350 were withdrawn from the account.
WS says that on 6 March 2014, an amount of $4,798 was withdrawn from the passbook account, leaving a balance of $0.25. The account was finally closed on 29 April 2015 upon a withdrawal of $1.22.
WS states that until the bank provided him with information, he was unaware of any of the transactions on HD's passbook account and the term deposit. He says that he and his other siblings sought legal advice, and a letter was sent to BP seeking information about the bank transactions and also about HD's coin collection and jewellery, which purportedly formed part of her estate.
WS says that BP did not initially respond to the request for information, but in a subsequent telephone conversation, BP is reported to have said that she was in possession of the relevant financial records.
At the hearing, WS produced a document that he says may have been a will of HD, purportedly made in 1991. The document does not appear to have been signed by HD.
HD states that he is seeking an order from the Tribunal requiring BP to file all the records that she has concerning her role as attorney under the EPA, and to have those records audited. In this he is supported by the children of HD present at the hearing, except for BP. In particular, he is seeking a copy of all bank statements and the invoices or receipts evidencing expenditure made by BP.
The case presented by BP
BP states that WS and the siblings who support his application did not want to have anything to do with HD after the death of HD's husband in 2002. She states that they did not contribute to the husband's funeral or to the care of HD from 2002 until her death in 2010.
BP states that at the time of the death of HD's husband, there was a joint bank account containing $1,301 and an account, purportedly for both their funerals, containing $5,000 and to which she and KS had access. BP states that there was a large gathering at the funeral and that the husband's 'after funeral expenses' were paid by her.
BP says that her siblings did not want to see HD because she was suffering from severe dementia. BP states that when HD went into a nursing home, she visited almost daily to ensure that she was receiving the appropriate care.
BP alleges that the real reason for the application is a reaction by her siblings to the civil action she currently has with her sister, EM. She alleges that her siblings have sided with EM and are attempting to discredit her.
BP questions why WS and her other siblings did not ask her any questions or details about HD until now and why she was never contacted in person rather than by way of a letter from a lawyer.
BP states that she has been harassed by her siblings and this has caused her great distress and has affected her health.
BP states that she began to act as attorney for HD from about the time the instrument was made in November 2002 because of HD's impaired mental state.
On the day of the hearing, BP submitted a statement which purports to explain how HD's money was expended for the period from the death of HD's husband on 26 April 2002 to HD's death on 4 November 2010 (financial statement). The financial statement was not accompanied by any supporting invoices or receipts.
The financial statement is difficult to fully grasp, but seems to say as follows (this is my summary of the statement using the figures provided by BP):
| Income |
| Pension income 26/04/2002 to 04/11/2010 $109,806.78 |
| Funds received from family members 16,000.00 |
| Total available funds from 26/04/2002 to 04/11/2010 $125,806.78 |
| Expenditure |
| Prior to HD living in a nursing home |
| Homeswest rent 3,600.00 |
| Home help 2,100.00 |
| Home Chef meals 2,730.00 |
| Costs of preparing Homeswest property |
| for end of tenancy 600.00 |
| Paid to KS when HD was living with her; |
| $200 per fortnight for six months 2,600.00 $11,630.00 |
| Nursing home from 19 June 2003 |
| Daily bed fees $84,182.55 |
| Annual expenses |
| Medications 897.00 |
| Podiatry 240.00 |
| Hairdresser 360.00 |
| Concerts/Outings 150.00 |
| Sheepskin 40.00 |
| Pillows 40.00 |
| Ambulance Fund 25.00 |
| Creams/talc 120.00 |
| Aromatherapy 100.00 |
| 'Noni juice' 720.00 |
| Incontinence pads 1,440.00 |
| Clothes 250.00 |
| Shoes/slippers 50.00 |
| $4,432.00 |
| For 7.5 years $33,240.00 |
| One-off costs |
| Layback wheelchair 1,200.00 |
| Electric chairlift chair 1,800.00 |
| Dentures 600.00 |
| Spectacles 205.00 |
| Debt to Centrelink 194.00 |
| Cruise in 2005 2,844.00 $6,843.00 |
| Expenses after the death of HD |
| Funeral costs 8,000.00 |
| Christmas party 2013 350.00 $8,350.00 |
| Travel expenses calculated on a per kilometre basis $39,930 .08 |
| Unknown receipt $394.00 |
| Pocket money for HD for 10 years at $20 per week |
| for the first four years and $10 per week for six years $7,280.00 |
| Total Expenditure $191,849.63 |
| Deficit ($66,042.85) |
BP admits that just before HD's death, using her authority as attorney, she transferred the funds in the term deposit initially in the name of HD alone into a term deposit in the joint names of herself and HD. The funds transferred totalled $26,987.98.
BP accepts that the effect of this transaction was that on the death of HD, the funds in the jointly held term deposit became hers by way of survivorship. She states that she considered the funds were partial reimbursement of the expenditure she had made for HD from her own funds, as described in the financial statement she submitted to the Tribunal.
BP states that for the same reason (partial reimbursement of expenditure made on behalf of HD), she closed HD's passbook account on 6 March 2014, and withdrew $4,798 and paid those funds to herself.
BP states that the $8,000 withdrawn from HD's passbook account on 9 November 2010 was in payment of HD's funeral expenses. She further states that the amount of $650 and $350 withdrawn from HD's passbook account on 29 November and 4 December 2013 respectively, were in payment of a Christmas party which all the family attended.
BP states that her siblings had previously made reference to another bank account purportedly owned by HD but which, in fact, represented a gift of $5,000 that HD had made to her daughter, MS, around 1998.
BP states that she continues to hold as part of HD's estate, 10 fifty cent pieces, nine $1 notes and three $2 notes. She also holds photographs, but not any of HD's jewellery, which she says was left with the daughter, KS, when HD was staying in KS's home.
BP says that after the death of HD, a 'garage sale' was held of HD's possessions and that family members received various items.
BP states that the coins and photographs are all she now holds of HD's deceased estate. There are no remaining bank funds.
BP is not opposed to the applicant and her other siblings being given a copy of the financial statement. She says that she does not have the receipts for all transactions made during the period of the EPA, but does retain the bank records and the nursing home accounts.
The decision of the Tribunal
The jurisdiction of the Tribunal under s 109(1)(a) and s 109(1)(b) of the GA Act does not stop on the death of the donor, in this case HD: KS [2008] WASAT 29 at [20] - [37] (KS).
The period for which the Tribunal can make an order, under s 109(1)(a) and s 109(1)(b) of the GA Act, cannot be longer than the time from which the attorney began to operate the relevant EPA to the death of the donor: KS at [22] and [23].
BP states, and I accept, that she began to act as attorney for HD from around the date the EPA was executed on 8 November 2002.
HD died on 4 November 2010, which means that for the purposes of s 109(1)(a) and s 109(1)(b) of the GA Act, the relevant period is 8 November 2002 to 4 November 2010.
The Tribunal exercises a supervisory jurisdiction under s 109(1)(a) and s 109(1)(b) of the GA Act contextualised by the statutory obligations of an attorney under s 107(1)(a) and s 107(1)(b) of the Act to exercise their powers as attorney with reasonable diligence to protect the interests of the donor and, if they fail to do so, to be liable to the donor for any loss occasioned by the failure, and to keep and preserve records and accounts of any dealings and transactions made under the power: GA and EA and GS [2013] WASAT 175 at [24] (GA).
I accept that WS has a proper interest in the matter as required by s 109 of the GA Act. He is the son of HD and has an interest in her deceased estate. He discovered bank transactions on the account of HD which I accept would have caused him to seek further explanation from BP but which he did not receive. The applications he made under s 109 of the GA Act were not unreasonable in the circumstances.
I accept that the applications are not vexatious or frivolous: EW [2010] WASAT 91 at [20] - [28] (EW).
The question before me is whether I should exercise my discretion under s 109(1)(a) and s 109(1)(b) of the GA Act; that is, whether I am satisfied, on the evidence, that there is something which requires an enquiry and there is a sufficient basis for the making of orders: GA at [26] citing EW.
BP has provided a financial statement which purportedly explains how she subsidised the living costs of HD both prior to and during her placement at the nursing home. It is, on HD's calculations, a significant subsidy and the funds she withdrew from the bank accounts of HD and paid to herself did not cover that subsidy.
BP submits that she remains out of pocket in respect of the expenditure she says she made from her own funds on behalf of HD.
The financial statement was prepared by BP for the Tribunal proceedings and clearly contains estimated figures. For example, it makes allowance for a substantial amount of travel expenses calculated on a per kilometre basis and also for 'pocket money' purportedly paid to HD.
The financial statement contains expenditure for which accounts or receipts should have been provided by vendors, and other expenditure where this would not be the case (for example, the travel and pocket money already mentioned and other expenditure such as the $200 per fortnight allegedly made available to KS for a six month period).
I accept that the estate of HD, whilst she was alive, was not large in monetary terms. Her main income was the age pension which I am satisfied was largely used for nursing home fees from when she entered the aged care facility in June 2003 until her death in November 2010.
Despite this, the accounting apparently used by BP in her role as attorney was unusual in that she appears (again by her calculations) to have paid for some of HD's expenditure from her own funds when HD had funds at her disposal, albeit, it appears, largely in the term deposit.
There is some cause for concern that just prior to HD's death, BP effectively removed the term deposit from HD's estate. The proper course, in my view, would have been for BP to have reimbursed herself on a regular basis for the direct expenditure she made for HD and to clearly account at the time for that reimbursement by attaching to it the relevant accounts and receipts.
The way in which BP has accounted for expenditure well after the event has invariably led to speculation of mismanagement that the applications before the Tribunal allege.
Because of the uncertainty in the accounting of BP, I am satisfied, on balance, that I should make an order under s 109(1)(a) of the GA Act.
I have considered whether, because of the time that has elapsed since the EPA began to operate and the death of HD, requiring BP to produce accounts would be unduly onerous: BFO & Ors and KPW [2014] WASAT 68 at [31].
The evidence of BP is that she has retained the bank records of HD and some accounts, such as those from the nursing home. She should be required to file those bank records and any other accounts or receipts she continues to hold.
I consider it onerous to require BP at this time to seek records directly from the bank, and vendors and service providers, given that potentially they go as far back as November 2002. There is sufficient doubt, in my view, that if BP no longer has these accounts or receipts, they can reasonably be expected to have been retained by the original parties.
BP does not object to the financial statement being given to the applicant and I will allow that to occur.
I will otherwise order that BP file with the Tribunal and give to the applicant a copy of the bank account records and other records she currently holds in respect to the transactions she undertook as attorney of HD. I do not require her to seek further records.
Given the long time frame covered by the applications, the relatively small size of HD's estate, the admissions of BP as to the destination of the term deposit and other bank funds (the latter after the death of HD), and the information contained in the financial statement, I am not convinced that an audit of the records BP is required to produce will materially add to the totality of information available on the estate of HD.
I will therefore dismiss the application under s 109(1)(b) of the GA Act.
Orders
1.[BP], as attorney under an enduring power of attorney executed by the late [HD] on 8 November 2002, is required to file with the Tribunal within 21 days of the date of this order, and serve on the applicant, a copy of all records and accounts (including bank records) currently held by her in respect of the transactions and dealings made as attorney.
2.The period for which the records and accounts are to be given is from 8 November 2002 to 4 November 2010.
3.The Tribunal will give to the applicant a copy of the financial statement filed by BP on 23 November 2015.
4.The application made under s 109(1)(b) of the Guardian and Administration Act 1990 (WA), is dismissed.
I certify that this and the preceding [63] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
___________________________________
MR J MANSVELD, SENIOR MEMBER
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