ILS and SK
[2012] WASAT 203
•11 OCTOBER 2012
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL
STREAM: HUMAN RIGHTS
ACT: GUARDIANSHIP AND ADMINISTRATION ACT 1990 (WA)
CITATION: ILS and SK [2012] WASAT 203
MEMBER: MR J MANSVELD (MEMBER)
HEARD: 7 MAY 2012
DELIVERED : 11 OCTOBER 2012
FILE NO/S: GAA 458 of 2011
BETWEEN: ILS
Represented Person
AND
SK
ApplicantPUBLIC TRUSTEE
First RespondentMS
Second Respondent
Catchwords:
Guardianship and administration - Administration - Requirement of administrators to submit accounts to Public Trustee - Public Trustee to examine accounts - Public Trustee to allow accounts, disallow any amount paid and determine that any amount or asset has been omitted or that any loss has occurred - Public Trustee to determine whether there has been a loss to or diminution of the estate - Accounts examined by Public Trustee and allowed are conclusive unless administrator acted dishonestly, in bad faith or without reasonable cause - Person aggrieved by decision of Public Trustee can apply for review of decision - Decision under review is by way of hearing de novo
Legislation:
Guardianship and Administration Act 1990 (WA), s 69(3), s 69(4), s 70, s 71(2), s 71(5), s 72(3), s 78, s 80, s 80(3), s 80(3)(a), s 80(5), s 80(6), s 80(6a), s 84
Guardianship and Administration Regulations 2005 (WA), reg 4, reg 4(3)
Interpretation Act 1984 (WA), s 48, s 55
State Administrative Tribunal Act 2004 (WA), s 3, s 17(3), s 20(1), s 26, s 27(1), s 27(2), s 29(1), s 29(3), s 31
State Administrative Tribunal Rules 2004 (WA), r 9, r 10
Result:
ILS suffered loss of $158,747.73 to her estate
Category: B
Representation:
Counsel:
Represented Person : N/A
Applicant: Self-represented
First Respondent : Ms C Lakewood
Second Respondent : Self-represented
Solicitors:
Represented Person : N/A
Applicant: N/A
First Respondent : State Solicitor's Office
Second Respondent : N/A
Case(s) referred to in decision(s):
Baumgartner v Baumgartner (1987) 164 CLR 137
Charlton v Baber [2003] NSWSC 745
EH [2008] WASAT 222
FS [2007] WASAT 202
Muschinski v Dodds (1985) 160 CLR 583
National Australia Bank Ltd v Maher [1995] 1 VR 318
Perpetual Trustees WA Limited and The Public Trustee [2009] WASAT 253
Public Trustee v Blackwood (1998) 8 Tas R 256
Re The Full Board of the Guardianship and Administration Board [2003] WASCA 268
Venture Management Ltd v Commissioner of State Taxation (WA) (1991) 4 WAR 283
Worsley Timber 2000 Pty Ltd (in liq) v Commissioner of State Revenue [2007] WASC 155
REASONS FOR DECISION OF THE TRIBUNAL:
Summary of Tribunal's decision
A daughter had been appointed the administrator of her mother's estate. As an administrator, she was required to submit annual accounts to the Public Trustee in respect to the management of the estate.
The principal asset in the woman's estate was a property which, at the time the administrator was first appointed, was held by the woman and her husband as joint tenants.
The woman lived in a nursing home. Her husband continued to live in the property.
The daughter purchased her father's share of the property. After the purchase, the property was held by the daughter and the woman as tenants in common in equal shares.
Sometime after the woman's husband left the property, the daughter arranged for the property to be sold. When settlement took place, the net proceeds of $386,095.47 were banked to an account under the control of the daughter.
The daughter did not record the sale of the property in the woman's estate in the period of the annual account in which the sale took place. The woman was due to receive 50% of the sale proceeds which amounted to $193,047.73.
The Public Trustee decided that the daughter had not accounted for the woman's share of the sale proceeds and determined that a loss had occurred on the woman's estate.
The daughter made various submissions to the Public Trustee and the amount of the loss was amended.
The daughter sought a review of the Public Trustee's decision.
The daughter made a number of submissions to the Tribunal. They were that:
•the woman did not really own 50% of the property because it had always been intended that the woman's husband would retain a quarter share;
•the daughter was entitled to a greater share than 50% of the property sale because she had contributed more than the woman to renovations and maintenance to the property; and
•she had made payments from the woman's share of the property sale to family members that she, as administrator, was authorised to do.
The Tribunal rejected the daughter's submissions, and found that her evidence lacked credibility and was largely selfserving. The Tribunal found that the daughter's evidence took the form of a revision of events and intentions when she had been put to the test to explain the disbursement of the woman's estate after the sale of the property.
The Tribunal calculated the loss on the estate of the woman as $158,747.73.
Introduction
These reasons relate to an application made under the Guardianship and Administration Act 1990 (WA) (GA Act).
The application has been made by the daughter of the represented person (SK), who is the former administrator of the estate of her late mother (ILS).
The application seeks a review of a decision of the Public Trustee that a loss occurred on the estate of ILS when SK was the administrator of that estate.
The Public Trustee says that the loss occurred because, under the administration of SK, ILS did not receive her full share of the proceeds of the sale of a property originally purchased by ILS and her husband (AHS) in about 1980 (property). At the time of the sale, ILS and SK were described on the land title as each owning a half share of the property. The Public Trustee also says that SK made gifts from the estate of ILS that she was not entitled to make, and is currently claiming for expenditure on the property prior to its sale for which she has insufficient evidence and, in any case, for which she cannot now claim, because she did not do so at the time she provided the yearly accounts to the Public Trustee. The Public Trustee says that SK has also not accounted for ILS's share of the rent that was received on the property.
SK maintains that her father, AHS, made the financial decisions in the family and instructed her on how the proceeds of the sale of the property should be distributed. AHS also said that SK should keep all of the rent that was received on the property. SK says that she was entitled to a greater share of the proceeds because she contributed more to the property than her parents, in particular, by purchasing a half share from AHS at a profit to him, and by paying for renovations and maintenance on the property. SK also says that when she purchased her half share of the property, it was always the intention that the remaining half be held jointly by ILS and AHS. It was simply an error that ILS was shown on the land title as having the whole of the remaining half share.
The issue before the Tribunal is whether a loss has occurred on the estate of ILS when SK was the administrator and, if so, the amount of that loss.
Background
On 12 February 2001, SK was appointed the plenary administrator of the estate of ILS by the former Guardianship and Administration Board (Board).
In January 2005, the Tribunal took over most of the functions of the Board.
On 10 January 2006, upon review under s 84 of the GA Act, the Tribunal reappointed SK as plenary administrator.
On 14 October 2008, ILS died. By the operation of s 78 of the GA Act, SK's role as administrator ceased upon the death of ILS.
The GA Act
The appointment of a plenary administrator confers upon the administrator significant authority attendant with significant duties and responsibilities (s 69(3), s 70, and s 71(2) of the GA Act).
The estate of a person for whom an administrator has been appointed does not vest in an administrator (s 69(4) of the GA Act).
An administrator must not, unless authorised by the Tribunal, make a payment or disposition of a charitable, benevolent or ex gratia nature from the estate of the person or make a payment in respect of a debt, or demand that the person is not obliged, by law, to pay (s 72(3) of the GA Act).
The duties and responsibilities of an administrator were encapsulated by Heenan J, when he said in Re The Full Board of the Guardianship and Administration Board [2003] WASCA 268, at [43]:
… it is obvious that the legislation is designed for the protection of adult persons whose faculties may be impaired, for any reason, and who are therefore in need of protection and assistance so as to ensure that their financial affairs and other welfare is not jeopardised by improvident, or illconsidered personal decisions or action, or by unscrupulous or illadvised influence of relatives, friends and others who may deliberately or inadvertently exploit the vulnerability of the person in need of assistance and protection.
An administrator must act in the best interests of the person (s 70 of the GA Act).
Fundamentally, the expression 'best interests', in the context of a protective jurisdiction, reinforces the idea that the paramount concern is the overall interest of the person to whom the protection is directed: Public Trustee v Blackwood (1998) 8 Tas R 256. Put another way, the expression is primarily concerned with the person's 'separate and independent welfare', and not with the welfare of others: Charlton v Baber [2003] NSWSC 745 at [52].
The application
This matter has a long history before the Tribunal.
The application by SK is made under s 80(6a) of the GA Act and was filed with the Tribunal on 31 January 2011.
Section 80(6a) of the GA Act allows a person who is aggrieved by a decision of the Public Trustee under s 80(3) of the GA Act to apply for a review of the decision by the Tribunal.
Section 80(3) of the GA Act requires the Public Trustee to examine accounts lodged by an administrator and, after examining the accounts, may:
•allow the accounts;
•disallow any amount paid; or
•determine that any amount or asset has been omitted or that any loss has occurred.
Under s 80(3) of the GA Act, the Public Trustee determined a loss to the estate of ILS on 13 July 2009, 18 June 2010 and 29 December 2010.
On 18 March 2011, the Tribunal referred the matter to mediation between the parties. MS, the sister of SK and the daughter of ILS, was joined as a party at that time.
The mediation process concluded on 9 August 2011. Programming orders were made on 14 September 2011, 22 November 2011, 17 January 2012, 21 February 2012 and 21 March 2012.
The application was finally heard on 7 May 2012. Present were:
•SK;
•DD from the Office of the Public Advocate;
•MD, an officer of the first respondent (the Public Trustee); and
•counsel for the Public Trustee.
MS, the second respondent, was not represented. The evidence of SK was taken on oath. The decision was reserved.
The Tribunal's powers on review
The application is made under the Tribunal's review jurisdiction, and is therefore heard de novo. The Tribunal stands in the shoes of the Public Trustee as the original decisionmaker and can take into account information that has become available since the original decision was made (s 27(1) and s 29(1) of the State Administrative Tribunal Act 2004 (WA) (SAT Act).
The Tribunal is bound to make the correct and preferable decision (s 27(2) of the SAT Act).
The Tribunal may affirm the decision under review, vary the decision, set aside the decision and substitute its own decision, or set aside the decision and send the matter back to the Public Trustee for reconsideration in accordance with any directions or recommendations the Tribunal considers appropriate (s 29(3) of the SAT Act).
Preliminary issue the reviewable decision
The Public Trustee submits that the reviewable decision (s 3 and s 17(3) of the SAT Act) is the one that he made on 29 December 2010 confirming the loss determined by him on 18 June 2010 pursuant to s 80(3) of the GA Act.
The Public Trustee had, on 29 December 2010, issued SK with a written notice of the decision and the right of review (s 20(1) of the SAT Act). He had previously issued such notices on 13 July 2009 and 18 June 2010.
Section 26 of the SAT Act does not allow the original decisionmaker to vary the decision, unless that is permitted by the enabling Act (in this case, the GA Act), the parties consent, or the decisionmaker is invited, under s 31 of the SAT Act, to reconsider the decision.
The Public Trustee submits that although there is no express power under s 80(3) of the GA Act to reconsider a determination made, s 48 and s 55 of the Interpretation Act 1984 (WA) (Interpretation Act) permits the reexercising of the power from time to time; for example, where new information becomes available.
Section 48 of the Interpretation Act states that where a written law confers a power or imposes a duty, the power may be exercised and the duty shall be performed from time to time as the occasion requires. Section 55 of the Interpretation Act relevantly states that where a written law confers a power or imposes a duty to do any act or thing of an administrative character, the power or duty may be exercised or performed as often as is necessary to correct any error or omission in the previous exercise of the power or duty, even if the power or duty is not, in general, capable of being exercised or performed from time to time.
It has been found that s 55 of the Interpretation Act cannot be invoked when all relevant facts and circumstances are before the decisionmaker and he simply changes his opinion as to the basis of his decision: Venture Management Ltd v Commissioner of State Taxation (WA) (1991) 4 WAR 283, cited with approval by Simmonds J in Worsley Timber 2000 Pty Ltd (in liq) v Commissioner of State Revenue [2007] WASC 155, at [207] [211].
I am satisfied that when the Public Trustee reexercised his power to calculate the loss under s 80(3) of the GA Act on 18 June 2010 and 29 December 2010, he did so in response to new information and submissions from SK, and was therefore entitled to do so.
I accept that the decision made by the Public Trustee on 29 December 2010 is the reviewable decision.
SK filed her application for review of the Public Trustee's decision on 31 January 2011, which the Public Trustee says is beyond the 28 days within which she was permitted to make the application after the notice of 29 December 2010 was given to her by the Public Trustee (r 9 of the State Administrative Tribunal Rules 2004 (WA) (SAT Rules) and s 20(1) of the SAT Act).
The Public Trustee had no objection to the Tribunal granting SK an extension of time to make her application pursuant to r 10 of the SAT Rules.
Pursuant to r 10 of the SAT Rules, I grant SK an extension of time to make the application for review of the Public Trustee's decision.
The reporting responsibilities of SK whilst the administrator of the estate of ILS
During the periods of the administration orders, SK was required to submit accounts to the Board and, after January 2005, to the Public Trustee (s 80 of the GA Act and reg 4 of the Guardianship and Administration Regulations 2005 (WA) (GA Regulations)).
Accounts were required for the following periods:
•12 February 2001 11 February 2002 (account 1);
•12 February 2002 11 February 2003 (account 2);
•12 February 2003 11 February 2004 (account 3);
•12 February 2004 11 February 2005 (account 4);
•12 February 2005 11 February 2006 (account 5);
•12 February 2006 11 February 2007 (account 6);
•1 May 2007 30 April 2008 (account 7); and
•1 May 2008 20 October 2008 (account 8).
Accounts 1 3 were filed with the Board. Accounts 4 8 were filed with the Public Trustee. The final set of accounts (account 8) was for the period up to the death of ILS (reg 4(3) of the GA Regulations).
When submitting the accounts, SK was required to depose an affidavit (accounts 1 3) and declare a statutory declaration (accounts 4 8) in the following terms:
…
2.The account … attached to this affidavit lists all the financial transactions relating to assets covered by the order of the Board [or Tribunal] during the period …
3.The account contains a true and correct record of the income, expenditure, assets and liabilities of the estate of [ILS] covered by the order of the Board [or Tribunal] during the period.
4.I/We have not made any gifts of cash, real property, personal property or other assets from the estate of [ILS].
{or}
I/We have made a gift(s) on behalf of [ILS] in the amount of/to the value of … in accordance with the authorisation of the Board [or Tribunal] in its order dated …
(First respondent's 'Section 24 Bundle' (respondent's book) at pages 43, 56, 75, 86, 108, 124, 178, 184 and 200).
The loss the Public Trustee says occurred on the estate of ILS when SK was the administrator
Prior to the hearing, the Public Trustee made a number of calculations of what he submits is the loss that has accrued to the estate of ILS.
The first calculation was made on 13 July 2009 when the Public Trustee issued SK with a certificate of loss for the amount of $194,547.73, represented by ILS's 50% share of the net proceeds of the sale of the property, $193,047.73 plus the balance of a loan to SK of $1,500 recorded in account 8. The loss was said to arise from a reexamination of account 6 and an examination of accounts 7 and 8 submitted by SK. The Public Trustee disallowed the amount of $194,547.73 in unauthorised payments, but otherwise allowed accounts 6 8, pursuant to s 80(3) of the GA Act (respondent's book at pages 7 9).
On 18 June 2010, the Public Trustee amended the certificate of loss to an amount of $158,672.91, represented by the original calculated loss of $194,547.73 less $30,000, said to have been expended on behalf of the disabled daughter of ILS (MS), and property expenses of $5,874.82, reported by SK and for which it was considered she should be reimbursed. The loss was said to arise from a reexamination of accounts 6 8. The Public Trustee reserved its position with respect to rent earned on the property (respondent's book at pages 14 29).
On 29 December 2010, the Public Trustee wrote to SK after receiving further submissions from her. The Public Trustee decided not to change the certificate of loss from that made on 18 June 2010, despite his contention that only half of the property expenses of $5,874.82 ($2,937.41) should have been charged to the estate of ILS to reflect her share of the ownership of the property.
In a Statement of Issues, Facts and Contentions (SIFC) filed with the Tribunal on 20 October 2011, the Public Trustee amended his calculation of the loss to a figure of '$193,296.79 [sic $193,269.79]'. The property expenses were adjusted to $2,555.87, of which 50% is $1,277.94. The loss figure was determined by taking the original calculated loss of $194,547.73 and deducting the share of the property expenses of $1,277.94.
In a SIFC filed with the Tribunal on 2 December 2011, the Public Trustee further amended his calculation of the loss that he says occurred on the estate of ILS. He recalculated the loss as $191,610.32. This loss is represented by the original calculated loss of $194,547.73 less 50% of the original property expenses figure allowed of $5,874.82 ($2,937.41).
In a submission to the Tribunal filed on 9 March 2012, the Public Trustee further amended his calculation of the loss. The new loss figure was said to be $192,112.47. The amount of the property expenses was, again, changed, this time to $4,870.52 (from $5,874.82), and if accepted as having been incurred by SK, then 50% of the expenses ($2,435.26) would be charged to the estate of ILS. The original calculated loss of $194,547.73 less the share of the property expenses of $2,435.26 amounted to $192,112.47.
The Public Trustee now submits that there is insufficient evidence to charge the estate of ILS with any of the property expenses SK says she has incurred, other than those costs recorded in the accounts. In addition, the Public Trustee says that ILS was entitled to her share of the rent on the property reported by SK, in her statement of 14 February 2012, as $4,200 (see below). The Public Trustee concedes that a payment of $40,000 made to a term deposit with the Bendigo Bank was derived from the proceeds of the sale of the property and, because it is recorded in account 8 and in a statement by SK to the Probate Division of the Supreme Court, it properly formed part of the estate of ILS (T:118; 07.05.12) (see below).
The final loss determined by the Public Trustee is therefore $158,747.73, represented by the share of the sale of the property of $193,047.73 less the $40,000 Bendigo Bank term deposit, but adding the unpaid loan to SK of $1,500 and ILS's share of the rent of $4,200.
The submissions of the Public Trustee are further addressed later in these reasons.
Relevant information from the accounts filed by SK
Because the Public Trustee says that the loss on the estate of ILS occurred from the sale of a property in which ILS had a share and from unauthorised gifting that was made from her estate, and because SK says that she was entitled to a greater share of the property than was shown on the land title and that she paid for renovations and maintenance, it is important to establish exactly what SK reported when she submitted yearly accounts as administrator.
Accounts 1 8 are before the Tribunal.
Account 1: 12 February 2001 11 February 2002 submitted on 15 April 2002 and 21 May 2002
In her affidavit, SK stated that the period of the account was from 1 February 2001 to 31 January 2002. She deposed that no gifts had been made.
Under 'Abstract 2 Expenditure Payments', SK relevantly recorded $1,000 for property expenses and explained:
Repairs & Maint. Receipts $2[,]925. Paid by [ILS] $1,000. Balance paid by my father. Property rates & taxes deferred.
Under 'Other Expenses', SK noted that the building insurance had been paid by her father.
Under 'Abstract 3 Assets', SK relevantly recorded a value of $50,000 for the property jointly owned by ILS and AHS. She stated that the property was occupied by AHS and MS. ILS was said to own 50% of the 'household furniture' valued at $1,000.
Under 'Abstract 4 Liabilities/Loans', SK recorded 'Rates & taxes (deferred) owing on family home 50% $3[,]044.18'.
Account 1 was allowed by the Board, pursuant to s 80(3)(a) of the GA Act, on 30 May 2002 (respondent's book at page 54).
Account 2: 12 February 2002 11 February 2003 submitted on 22 May 2003
In her affidavit, SK stated that the period of the account was from 12 February 2002 to 11 February 2003. She deposed that no gifts had been made.
Under 'Abstract 2 Expenditure Payments', SK relevantly recorded property expenses as $1,500, with the note: 'see liabilities'.
Under 'Abstract 3 Assets', SK relevantly recorded a value of $55,000 for ILS's share (50%) of the property, and $350 (50%) for 'household items'.
Under 'Abstract 4 Liabilities/Loans', SK recorded $5,520 made up as follows:
1 House maintenance (1/2) $828.00 = $414.00
2 Rates (1/2) $5229.37 = $2614.00
3 Pre paid funeral … $3205.00
4 Cemetery [B]oard … $787.00
Total $7020.00
Less paid $1500.00 $5520.00[.]
Account 2 was allowed by the Board, pursuant to s 80(3)(a) of the GA Act, on 28 May 2003 (respondent's book at page 73).
Account 3: 12 February 2003 11 February 2004 (submission date not shown but affidavit deposed on 14 July 2004)
In her affidavit, SK stated that the period of the account was from 14 February 2003 to 13 February 2004. She deposed that no gifts had been made.
This account is only partially before the Tribunal. It does not contain 'Abstract 2 Expenditure Payments' or 'Abstract 4 Liabilities/Loans', although there is a schedule of income and payments (respondent's book at page 80) which makes no reference to property expenses.
Under 'Abstract 3 Assets', SK relevantly recorded the value of ILS's share of the property (described as 'half ownership') as $50,000 and 'N/A' for 'Personal property/other assets'.
There is a note from an officer of the Board from July 2004 (respondent's book at page 81) with the relevant notation:
[ILS] is a 50% partner in house with [AHS] who resides there with daughter.
It would appear that [AHS] has paid for all household outgoings this period.
Account 3 was allowed by the Board, pursuant to s 80(3)(a) of the GA Act, on 27 July 2004 (respondent's book at page 82).
Account 4: 12 February 2004 11 February 2005 submitted on 30 March 2005
In her statutory declaration, SK stated that the period of the account was from 12 February 2004 to 11 February 2005. She declared that no gifts had been made.
SK provided a covering letter with account 4 (respondent's book at page 85), which relevantly states:
In the case of [ILS] I wish to advise that I have receipts for nearly seven thousand dollars for property maintenance for the [property]. These receipts do not include the cost of external painting of the house[,] and the removal of the old pergola and installation of a new one. The total of these was approximately $6[,]500 (photograph proof only)[.] I have not enclosed the receipts as a lot are only till tapes and many are faded but should you wish to see them I can send to you for your perusal in the hope that they can be returned to me.
Under 'Abstract 2 Expenditure/Payments', SK relevantly recorded property expenses as $3,500. For 'Other expenses', she noted: 'Shire rates, clothing & personal items paid by [AHS] and [SK]'.
Under 'Abstract 3 Assets', SK relevantly recorded the value of ILS's share (described as '50%') of the property as $75,000 and 'N/A' for 'Personal property & other assets'.
No amounts were recorded under 'Abstract 4 Liabilities/Loans'.
There is a note from an officer of the Public Trustee dated 8 December 2005 (respondent's book at page 92), which relevantly states:
[ILS] owns 50% of a property with her husband. Her husband resides in the property. [ILS] has paid $3,500 in property expenses this year. The administrator has provided a schedule of these payments. [ILS]'s husband & the administrator have paid the Shire rates and for the clothing & personal items for [ILS].
Account 4 was allowed by the Public Trustee, pursuant to s 80(3)(a) of the GA Act, on 8 December 2005 (respondent's book at pages 92 and 103).
Account 5: 12 February 2005 11 February 2006 submitted on 23 August 2006
In her statutory declaration, SK stated that the period of the account was from 12 February 2005 to 11 February 2006 but, in 'Form B Summary of Accounts', she stated that the accounting period was from 12 February 2005 to 21 April 2006. She declared that a gift of $5 was made from the estate of ILS to her daughter, MS.
Under 'Abstract 2 Expenditure/Payments', SK relevantly recorded property expenses as $2,400 for 'House/share of upkeep/renovations/repairs' and $685.87 for 'Shire rates/share'.
Under 'Abstract 3 Assets', SK relevantly recorded the value of ILS's share of the property as $150,000 and also, it appears, as $400,000. She did not record anything for 'Personal property and other assets'.
No amounts were recorded under 'Abstract 4 Liabilities/Loans'.
By way of letter to SK dated 6 September 2006 (respondent's book at page 114), the Public Trustee sought 'receipts and/or explanations' for the amounts shown as property expenses.
There is no documentary evidence in the respondent's book which shows whether SK provided a response to the enquiry or whether the Public Trustee passed the accounts.
Account 6: 12 February 2006 11 February 2007 submitted on 24 April 2007
In her statutory declaration, SK stated that the period of the account was from 21 April 2006 to 11 February 2007. She declared that no gifts had been made.
Under 'Abstract 2 Expenditure/Payments', SK did not record an amount for property expenses.
Under 'Abstract 3 Assets', SK relevantly recorded the value of ILS's share of the property as $150,000. She did not record any value for 'Personal property and other assets'.
Prior to account 6, it seems that ILS did not have a bank account and that transactions occurred through the nursing home resident account. In account 6, the resident account did not appear, and a Bendigo Bank account was mentioned with a balance of $1,513.45.
No amounts were recorded under 'Abstract 4 Liabilities/Loans'.
By way of letter to SK dated 25 September 2007 (respondent's book at page 132), the Public Trustee advised that account 6 had been passed and that the annual reporting period had been varied from '12 February to 11 February (old period) 1 May to 30 April (new period)'. The next account was therefore an interim account from 12 February 2007 to 30 April 2008 and, thereafter, annually from 1 May to 30 April.
The Public Trustee requested the latest copies of the shire and water rates, and household insurance documents.
Account 6 was allowed by the Public Trustee on 24 September 2007 (respondent's book at page 131).
Events subsequent to the passing of account 6 and before the filing of amended account 6 and account 7
AHS died on 30 June 2007 (respondent's book at page 133).
On 28 July 2007, SK, as executor of AHS's will, filed a statement of assets and liabilities with the Probate Division of the Supreme Court (respondent's book at pages 135 138). This shows the only asset of the estate as bank funds. There were no liabilities noted.
In a letter to SK dated 11 December 2007 (respondent's book at page 139), the Public Trustee referred to a conversation with SK that morning, in which she is reported as having said that the property was sold more than 18 months ago and that an amount of $30,000 from the estate of ILS had been gifted to MS.
The Public Trustee advised that these transactions were not recorded in account 6. SK was required to resubmit part of account 6.
In response, SK relevantly stated, in a letter dated 17 January 2008 (respondent's book at page 142), that:
•the property was no longer an asset of ILS;
•at no time was it the sole asset of ILS; and
•her interest was always 50%, with the other owner being SK.
SK further stated that, as coowner of the property and as 'trustee for my mother's financial affairs', she authorised the sale of the property.
In the respondent's book, at pages 145 167, the following documents are relevant to the transactions on the property:
•A certificate of title showing ILS and AHS as the registered proprietors of the property as joint tenants.
•A transfer of land dated 20 May 2003, in which AHS transferred his interest in the property to SK for $50,000. The transfer was registered with the Registrar of Titles on 18 May 2006.
•A 'Record of Certificate of Title' for the property obtained on 5 July 2006, recording that the property was owned by ILS and SK as tenants in common in equal shares.
•An undated transfer of land in which SK, in her own right and as administrator for ILS, transferred both their interests in the property to a purchaser for $400,000.
•A settlement statement dated 19 July 2006 addressed to SK showing that, after agent's commission and other costs, the net sale proceeds were $386,095.47, which was described as the '[a]mount banked on your behalf'. Aside from the then current year's rates (which had not been paid), the settlement statement shows an adjustment for 'Council rates arrears' of $823.85 and '[w]ater rates arrears' of $128.00.
The Public Trustee wrote to SK on 11 March 2008 (respondent's book at page 170) stating that sale of the property and the gift to MS of $30,000 were not recorded in account 6, nor were the proceeds of the sale of the property reflected in the bank accounts of ILS. SK was put on notice that the estate of ILS 'appears to have suffered a loss of approximately $193,047.73, being a one half share of the unreported sale proceeds'.
SK was invited to submit an amended account 6 and was asked to explain the gift to MS, after having declared on the statutory declaration to account 6 that no gifts had been made.
On 6 June 2008, a file note was recorded by an officer of the Public Trustee (respondent's book at page 176). The file note records a conversation on 5 June 2008 with the bookkeeper employed by SK to produce amended account 6 and account 7. The file note records that SK's instructions to the bookkeeper about the sale of the property were that AHS instructed that the property be sold, and that $85,000 of the sale proceeds be transferred to ILS, and of that $85,000, $40,000 be placed in a bank term deposit, $30,000 be transferred to MS and the balance be transferred to SK.
Amended account 6: 12 February 2006 11 February 2007 submitted on 29 July 2008
In her statutory declaration, SK stated that the period of the account was from 12 February 2006 to 11 February 2007. She declared that no gifts have been made.
Under 'Abstract 2 Expenditure/Payments', SK did not record an amount for property expenses.
Under 'Abstract 3 Assets', SK recorded an amount of $96,523.86 as 'Proceeds from Sale of House Held in [account] of [SK]'. The resident account reappeared with a balance of $2,138.76 and the Bendigo Bank account showed a balance of $1,513.45.
No amounts were recorded under 'Abstract 4 Liabilities/Loans'.
On 13 July 2009, the Public Trustee allowed the account, except to the extent of the loss in the context of issuing a certificate of loss to SK for the amount of $194,547.73, pursuant to s 80(6) of the GA Act.
Account 7: 1 May 2007 30 April 2008 submitted on 29 July 2008
It appears that there was a break in the reporting of transactions for the period from 12 February 2007 to 30 April 2007.
In her statutory declaration to account 7, SK stated that the period of the account was from 1 May 2007 to 30 April 2008. She declared that a gift of $10,000 was made during the accounting period without authorisation of the Tribunal.
Under 'Abstract 1 Receipts/Income', SK relevantly showed $85,000 as 'Sale of Assets' credited on 25 June 2007 and $600 as 'Loan Repayment [SK]'.
Under 'Abstract 2 Expenditure/Payments', SK relevantly recorded $42,967.70, which was explained in an attached spreadsheet as:
| Date | Details | Withdrawals | Details |
| 8/06/2007 | Forrestfield Shopping Centre | 200 | Incidentals |
| 26/06/2007 | Transfer to [AHS] | 29500 | Centrelink required same [Account] balances |
| 26/07/2007 | Harvey Norman | 449.96 | Equipment no receipts |
| 3/08/2007 | Transfer to [SK] | 1800 | Part payment [AHS] Funeral |
| 23/08/2007 | Transfer to Grandsons | 10000 | Gift[s] to [names given] |
| 23/10/2007 | Woolworths | 175.99 | Incidentals |
| 4/12/2007 | Withdrawal | 650 | Loan [SK] $600.00, Incidentals $50.00 |
| 12/03/2008 | [Nursing home] Transfer | 191.75 | Unknown withdrawal |
The spreadsheet also shows that on 2 October 2007, an amount of $40,000 was transferred to a term deposit with the Bendigo Bank.
Under 'Abstract 3 Assets', SK recorded (other than the nursing home resident account with a balance of $3,577.87) two Bendigo Bank accounts, one with a balance of $5,270.69 and the other a 'Term Deposit' of $40,452.24.
Under 'Abstract 4 Liabilities/Loans', SK recorded $280.20 as 'Balance of Funeral Invoice paid by [SK]'.
The Public Trustee allowed the account in the context of issuing the certificate of loss to SK on 13 July 2009, pursuant to s 80(6) of the GA Act.
Account 8: 1 May 2008 20 October 2008 (ILS died on 14 October 2008) submitted on 8 December 2008
In her statutory declaration, SK stated that the period of the account was from 1 May 2008 to 20 October 2008. She declared that no gifts had been made.
Under 'Abstract 1 Receipts/Income', SK relevantly recorded $1,000 as 'Loan Repayment'.
Under 'Abstract 2 Expenditure/Payments', SK relevantly recorded $2,500 as 'Loan to [SK]'.
Under 'Abstract 3 Assets', SK recorded:
Bendigo Bank [$]437.14
Bendigo Term Deposit [$]41789.93
[Nursing home] Account [$]6258.74[.]
In a letter accompanying account 8 dated 2 December 2008, SK stated that she had transferred $2,285 from ILS to herself for 'personal money I have used for legitimate expenses on my mother's behalf'. She stated that receipts for the expenditure were enclosed. SK added that she had also transferred a further $1,000 from ILS and paid $500 to herself and $500 to MS for Christmas.
In the letter, SK asked that the Public Trustee let her know as quickly as possible:
… when we can draw on mum's funds. Mum[']s only estate is the money she has in the bank. It is only a small estate and I would like the authority to divide the money left equally between [MS] and myself …
The Public Trustee allowed the account in the context of issuing the certificate of loss to SK on 13 July 2009, pursuant to s 80(6) of the GA Act.
Events subsequent to the filing of account 8 and before SK made her application under s 80(6a) of the GA Act
SK was granted Letters of Administration for the estate of ILS on 15 January 2009. She deposed that the estate had a gross value of $42,472.78, represented by the Bendigo Bank account of $437.14 and the Bendigo Bank term deposit of $42.035.64. There were no recorded liabilities.
On 13 July 2009, the Public Trustee issued SK with a certificate of loss for the amount of $194,547.73 (respondent's book at pages 7 9) (see above).
SK responded to the certificate of loss by way of a submission by her then legal representative, dated 31 August 2009 (respondent's book at pages 265 353) (see below).
On 18 June 2010, the Public Trustee amended the certificate of loss to the amount of $158,672.91 (respondent's book at pages 14 29) (see above).
On 29 December 2010, the Public Trustee advised SK of confirmation of the loss determined on 18 June 2010.
The evidence and submissions of SK
SK has, over time, made a number of submissions to the Public Trustee as regards the sale of the property and the subsequent certificates of loss issued by the Public Trustee. She also made written submissions to the Tribunal and gave oral evidence on oath at the hearing on 7 May 2012.
I will summarise her evidence in chronological order as it has been given by her, both in written and oral form.
Reference has already been made in these reasons to some of what SK recorded in the accounts with her supporting affidavits and statutory declarations (see above).
On 31 August 2009, the then legal representatives for SK submitted to the Public Trustee in response to the issuing of the first certificate of loss on 13 July 2009 for $194,547.73 (respondent's book at pages 265 353). Relevantly, the submission states:
•The family of ILS was very close. SK and her family lived close to her parents' home and visited them at least three times a week.
•ILS and AHS were very generous parents and grandparents. If the family was in need of something and they had the finances to assist, then they would assist.
•When SK purchased her 50% share of the property in May 2003, the remaining 50% was intended to be held jointly by ILS and AHS. It was due to the incorrect completion of the forms for the Registrar of Titles that AHS's name was omitted from the title.
•Between 2002 and 7 June 2006, SK spent approximately $46,914.80 on improvements for the property. SK personally contributed a portion of the labour required to improve the property. She was able to provide receipts for $20,439.80 of the expenditure.
•The net proceeds of the sale of the property were deposited directly in the bank account of SK.
•SK discussed the distribution of the proceeds with AHS, on her belief that he still had an interest in the property. He suggested that she keep the entire proceeds, but she refused. She expected that an amount would be paid to ILS for the joint interest of ILS and AHS in the property.
•After SK's discussions with AHS and after taking into account her financial contribution to the property, it was agreed between them that the joint share of ILS and AHS of the net sale proceeds of the property be valued at $125,000. Of that amount, $30,000 was used for the needs of MS (new hearing aids and new furniture) and $10,000 was paid to the grandchildren of ILS (SK's children). ILS and AHS were left with $85,000 after these payments.
•The payments to the grandchildren were consistent with the past actions of ILS and assisted in maintaining the close family environment. SK questioned whether the payments should be categorised as gifts: FS [2007] WASAT 202 (FS).
•An injustice would occur if account was not taken of the difference between the contributions of SK to the property (purchase price of $50,000 and $46,914.80 for improvements) as against the contributions of ILS and AHS (purchase price of $29,000 in about 1974 and nil for improvements). It was reasonable for SK to recover a larger proportion of the sale proceeds commensurate with her contribution to the property: Muschinski v Dodds (1985) 160 CLR 583, at [620]; Baumgartner v Baumgartner (1987) 164 CLR 137, at [149] [150]; and National Australia Bank Ltd v Maher [1995] 1 VR 318, at [321].
In her application for review of the Public Trustee's decision filed with the Tribunal on 31 January 2011, SK submits that the amended certificate of loss (29 December 2010) should be dismissed and the caveat the Public Trustee has placed on her residence be removed.
On 14 February 2012, SK submitted a detailed statement to the Tribunal in response to the Public Trustee's SIFC and the witness statement of MD.
Relevantly, SK states:
•When she purchased the 50% share of the property (she says in November 2002, when she paid the purchase funds to AHS, notwithstanding that the transfer of land was dated 20 May 2003), the $50,000 purchase price was deposited into AHS's bank account because ILS did not have a bank account at the time (the transactions for ILS were being processed through the nursing home resident account).
•It was always AHS who made the financial decisions for the family. ILS did not contribute financially to the household in any way because she cared for the daughter, MS, on a fulltime basis.
•ILS and AHS made a large profit on the sale of the property. It was reasonable that they should make a payment to the grandchildren, given that they shared a close relationship with them.
•The decision to set aside $30,000 for MS was made by AHS. A portion of the funds were used to purchase hearing aids for MS. ILS would have approved of this expenditure.
•As to the question of rent that was earned on the property, AHS told her that she could have the rental income, as he was aware of the costs she was incurring for renovations to the property. The amount of rent received was calculated by her as $8,400 (for 26 months), and she states that ILS's share (but for AHS saying that she should have all of the rent) would have been $4,200.
•The proceeds of the sale of the property were deposited to her bank account 'but this in no way indicates that my intention was to defraud my mother of any funds'. The original intention of AHS was that she be given all of the sale proceeds on the basis that neither he nor ILS needed the money and their estates would eventually come to her.
•When ILS died, she had close to $50,000 in bank funds, which demonstrated that she had had sufficient money to meet her needs.
•The failure to report the sale of the property in account 6 came about because of SK's ignorance of the reporting requirements.
•ILS could not afford the cost of improvements to the property, which were in excess of $60,000 and which did not include the labour contributed by SK. ILS contributed $6,000 to the cost of the improvements. SK states:
Considering [ILS's] very limited income[,] I took what was the logical course for renovations and that was to pay for [them] myself and recoup from the profit from the sale of the house. My mother received $150,000.00 profit from an asset [that] she had never contributed to financially.
On 16 February 2012, SK submitted a statutory declaration she made on 15 February 2012. She listed the renovations that she says occurred on the property and declared that the receipts she made available to the Public Trustee were for expenses on the property (see below).
In addition to the above, SK, in her oral evidence, relevantly states as follows.
She accepts that the amount of $96,523.86 shown as an asset in amended account 6 for ILS's estate (see above) represents one quarter of the net proceeds of the sale of the property. She says that her bookkeeper completed this account (T:99; 07.05.12).
SK states that the expenditure of $30,000 for MS (which does not appear in any of the accounts filed by SK for ILS) comprised of nearly $10,000 for hearing aids, $5,000 $6,000 for a bedroom suite, and the balance for expensive linen, a rocking chair, and a video player (T:101103; 07.05.12). SK accepts that the amount of $30,000 was paid from the proceeds of the sale of the property that she was holding.
SK accepts that the amount of $85,000, shown in account 7 as receipts/income, came from an account in her name to an account with the Bendigo Bank styled as '[SK] ATF [ILS]'. Out of those funds, $40,000 went into a term deposit; $29,500 was transferred to AHS just days before his death; $10,000 was gifted to ILS's grandsons (the sons of SK); and $1,800 was transferred to SK for part payment of AHS's funeral. SK cannot explain the basis of the transfer of $29,500 to AHS other than it related to a conversation she had with Centrelink and that it might have been 'approximately half of what mum had at the time' (T:106; 07.05.12 and T:104111; 07.05.12).
SK says that the reason the sale of the property was not recorded in account 6 was because 'it was still in my account. It was too late to transfer it into mum's account to reflect that she had received the money' (T:106; 07.05.12), and later:
… I knew I would get into trouble and the money was still in my account, so I just made out that mum still had a share in the house; it hadn't been sold, and I was just going to reorganise it for next year. (T:125; 07.05.12)
SK states that the term deposit of $40,000 was in her name 'but it was never considered mine' (T:109; 07.05.12).
SK says that she did not carry forward liabilities from one accounting period to another because she believed that the Public Trustee kept a record of those liabilities (T:119120; 07.05.12). She also says that she could not bring herself to keep charging 'liabilities' to ILS because most of ILS's pension income was being used to pay for her accommodation in the nursing home. SK says 'I'm not interested in claiming back anything from my mother for those sort[s] of things' (T:50; 07.05.12).
SK says that it had always been her intention, when the property was sold, to recoup the expenditure she had made on the property 'to realise such a large profit for mum and I' (T:120; 07.05.12).
SK states that she distributed ILS's share of the proceeds of the sale of the property in a way she believed ILS would have wished. She made those decisions as the daughter of ILS; she saw her role as administrator was to make sure her mother's needs were met. She submits that she succeeded in the latter task because ILS had sufficient funds available at the time of her death (T:132; 07.05.12).
When asked what direct benefit ILS received from the sale of the property, SK said: 'And what would she have used it for?' (T:132; 07.05.12).
SK says that she only became aware of the requirement to obtain Tribunal approval for any gifts she made from the estate of ILS in 2006 because, at that time, she was 'picked up on gifting' (T:133; 07.05.12). She goes on to say: 'But I'm well aware that I shouldn't have been gifting'. She says that she did not think to come to the Tribunal to seek that approval.
SK submits that the raising of the loss by the Public Trustee is wrong but, even if the figure of $194,000 is taken into account, then MS's share would be about $100,000 (on the basis that it would only be her and MS that would inherit the estate of ILS, although she later says that her parents had told her she would inherit the entire estate and that she had promised 'faithfully' to look after MS (T:128; 07.05.12)). SK says that MS has already received $55,000 and that, at the very most, ILS would owe her $20,000 because:
… I have taken care of [MS] extremely well in the past 10 years, and will continue to do so if I have the financial resources. If I don't have the financial resources[,] someone from the [P]ublic [T]rustee can go and tell [MS] that I no longer exist, because she'd be terribly upset if she thought I was telling her that I couldn't take her out every week and I don't have the money to pay it anyway. I'm not taking out another mortgage on my house. (T:128; 07.05.12)
As to her intentions, SK states:
I'm not trying to say that the things I've done wrong I haven't done, I'm putting up my hand for them, but they weren't nothing I've ever done in the past 10 years has been to defraud my family, my mother, my father or my sister. (T:131; 07.05.12)
The property expenses claimed by SK
SK submits that if any loss is declared on the estate of ILS, then it should be reduced by the amount of the expenditure she made on the property for maintenance, renovations and other costs. This was first put by SK in the submission made to the Public Trustee on 31 August 2009 by her then legal representative (see above), and then again in the statutory declaration by SK dated 15 February 2012 submitted to the Tribunal.
In the 31 August 2009 submission, SK states that between 2002 and 7 June 2006, she spent approximately $46,914.80 on improvements for the property. SK says that she personally contributed a portion of the labour required to improve the property. In the 15 February 2012 statutory declaration, SK states that the amount of expenditure was in excess of $60,000.
In both documents, SK lists the maintenance and renovations. The lists are similar, but not identical. The list in 2009 was:
(a)Erected [colorbond] panel fencing down one side of the Property, replacing a very old[,] rundown, warped and twisted post and rail fence;
(b)Removed an old pergola at the back of the Property and replaced it with a new one;
(c)Brick paved the pergola area;
(d)Repainted the entire interior of the house;
(e)Replaced the lights in all of the rooms of the house;
(f)Installed 3 security doors;
(g)Paved a path in front of the house and made concrete edging around all of the garden beds;
(h)Installed bamboo flooring in the lounge room, dining room, family room and the kitchen;
(i)Replaced the carpets in the bedrooms;
(j)Replaced all of the curtains in the house;
(k)Removed, sanded, painted and replaced the cupboard and replaced the bench tops;
(l)Erected lattice on the patio at the rear of the house;
(m)Installed a large double [colorbond] door to the carport;
(n)Landscaped the entire gardens around the house, which included purchasing soil, turf and plants from Dawson's nursery; and
(o)Pruned the trees around the house and Property.
The 2012 list does not contain items (e), (k) and (o), but added:
Driveway[.]
New letterbox[.]
Leaking roof on small front [veranda] replaced with new alsinite[.]
Exterior of house painted[,] including window frames and door frames[.]
Raised garden bed under pergola, planted and reticulated.
Large gum tree removed from front of property[.]
In the August 2009 submission to the Public Trustee, SK provided receipts and other identifying documents for maintenance and renovations expenditure of $20,439.80. The list of that expenditure is attached as Annexure A to these reasons. The list has been modified by the Tribunal from the one made in 2009, the expenditure now grouped by date and in chronological order.
SK has not provided any further documentary evidence of the expenditure she says was made on the property.
The relevant explanations given by SK for the expenditure are as follows (T:2272; 07.05.12):
•The documented expenditure relates to the maintenance and renovation that SK states took place, including expenditure to prepare the property for sale.
•SK says that she spent very little on her residence during the period of the expenditure so that the maintenance and renovation could be completed on the property. Her own residence has not been painted for over 10 years.
•SK generally paid cash for items, even for the larger amounts detailed on the list of expenditure.
•If payments were not made directly by SK, then they would have been made by AHS whilst he lived in the property (up until late 2003 or early 2004, after which he lived in an aged care facility), or by the tenant subsequent to the father leaving the property. SK would have reimbursed AHS and the tenant in cash.
•The goods were mostly purchased from businesses in the general area of the property (north of the Swan River). SK says that it would be highly unlikely that she would travel from her residence, which is southeast of the Swan River, to purchase items for herself. Where goods were purchased in the area of her residence, it was for convenience or, as with Dawson's nursery, to purchase plants for landscaping the property's garden. SK says that there is no lawn at her residence.
•The external painting of the property was carried out by a contractor. SK paid the contractor a total of $3,500 in cash. A receipt was not issued, so the payment was not included in the list of documented expenditure. SK says that she is unable to point to a specific amount or amounts withdrawn from her bank account to verify the payment.
•Item 1 of the schedule (Yanchep Hardware and Sports for $88) should not be claimed, because SK says that she did not begin to make payments for the property until October 2002.
•The City of Wanneroo rates of $5,229.37 (item 2 of the schedule) were paid by AHS and she reimbursed him in cash. SK says that she paid for all the rates and taxes on the property from the time she became the part owner. She paid for the excess water account when the property was tenanted. She says that she also paid for the property insurance, except for the year in which it was sold.
•Item 7 of the schedule (Mitre 10 for $56.39) should not be claimed, because the nature of the purchased item cannot be made out from the receipt.
•Item 15 of the schedule shows two payments to Dawson's nursery for $211. One is a duplicate and should not be claimed.
After deducting those items SK submits should not be claimed (items 1, 7 and 15), the documented expenditure totals $20,084.41.
The receipts and invoices for items 2, 3, 10, 11, 17, 18, 36, 37, 43, 47, 53, 57, and part of 58 on the schedule are the only documents which make some reference to the property. They total $11,715.99 and comprise rates, excess water and insurance of $6,169.49 and goods and services of $5,546.50. An approximate breakdown into accounting periods reveals that:
•account period 2 incurred $7,042.37 (rates $5,229.37 and goods and services $1,813);
•account period 3 incurred $1,982 (insurance $170 and goods and services $1,812);
•account period 5 incurred $726.72 (rates $685.67 and excess water $41.05); and
•account period 6 incurred $1,224.90 (excess water $43.40 and goods and services $1,181.50).
One receipt for $740.00 (tree lopping) was undated.
The Public Trustee submits that there is either no evidence, or insufficient, evidence about who paid for much of the expenditure, or that the goods purchased were specifically for the property. It is further submitted that the City of Wanneroo rates of $5,229.37 (item 2 on the schedule) cannot be deducted from the calculation of the loss to the estate of ILS because those rates have already been taken into account as a liability in account 2 (see above).
DD, from the Office of the Public Advocate, states that he visited the residence of SK and has noted the maintenance and renovations SK detailed in her statutory declaration of 15 February 2012. He did not visit the property.
DD submits that, based on his observations and an interview with SK in 2011, he is prepared to accept that the maintenance and renovations took place on the property, or at least did not form part of SK's residence. He cites, as examples, the pergola and the bamboo flooring, which were not parts of SK's residence when he visited. He also states that SK's residence has a small front area and there was no evidence of extensive landscaping.
The evidence of MD (for the Public Trustee)
MD is an officer of the Public Trustee. His current position is that of Senior Assessment Officer which he has held since January 2005. The position requires the management of a caseload of matters regarding the conduct and supervision of finances controlled by appointed administrators (except where the Public Trustee is the appointed administrator).
From July 1999 to December 2004, MD held the position of Senior Estate Management Officer with the Board, a position substantially similar to that of Senior Assessment Officer with the Public Trustee.
MD refers to the estate information form (Form A) SK filed with the Board on 30 March 2001 (respondent's book at pages 35 41).
Form A was required to be filed with the Board prior to the filing of any accounts (in this case, account 1).
Relevantly, Form A disclosed that:
•ILS was a resident of a nursing home;
•AHS and MS resided at the property;
•the property was unencumbered and jointly owned by ILS and AHS;
•the property was insured for $100,000;
•ILS held no bank accounts, but had an account with the nursing home (resident account);
•ILS owned no furniture, and her personal possessions were with her at the nursing home;
•ILS had no other assets; and
•ILS owed approximately $2,000 for deferred shire rates and $750 to AHS for her share of house maintenance for the property (septic tank and house painting).
MD refers to the accounts filed by SK. Relevantly, he states as follows:
Account 1
•The value for furniture of $1,000 must have been for furniture purchased after 30 March 2001, because the earlier Form A does not show any value for furniture.
•ILS must have owed AHS $462.50 for the balance of property expenses after deducting the payment of $1,000 shown in the accounts. Her liability had therefore reduced from the $750 shown in Form A.
•The deferred rates and taxes debt of 50% of $3,044.18 must have replaced the figure of $2,000 shown in Form A.
Account 2
•There was no explanation given by SK as to why the value of household items had fallen to $350 from $1,000 shown in account 1.
Account 4
•The amount of $3,500 shown by SK as property expenses must be ILS's share of the amount of $7,000 referred to by SK in her letter accompanying the account as 'property maintenance'.
•There was no record in the account of any liability of ILS's share of the amount of $6,500 that SK stated in her letter as being for external painting of the property, removal of the old pergola and installation of a new pergola.
Account 5
•The gift of $5 shown by SK to MS was actually a gift from MS to ILS.
Amended account 6
•The amount of $95,523.86, shown by SK as proceeds from the sale of the property, represented 25% of the total value of the settlement proceeds, when ILS was actually entitled to a half share.
Account 7
•The amount of $85,000 shown by SK as a receipt on the estate of ILS ('Sale of Assets') was identified by the Public Trustee as a deposit ('EBanking TFR') in the bank account of SK on 25 June 2007 (respondent's supplementary book at page 8).
•The term deposit of $40,000 with the Bendigo Bank was held in the name of SK (respondent's supplementary book at pages 10 and 11).
Account 8
The funeral expenses of $3,000 shown by SK in the account were made after the reporting period, and therefore did not need to be reported.
MD refers to a file note of a conversation on 23 December 2008 between SK and another officer of the Public Trustee (respondent's book at page 216). That officer did not appear before the Tribunal. The file note reports SK as stating that she had purchased AHS's interest in the property; that AHS had told her to take $250,000 for herself from the sale proceeds of the property, which she did; and that she had taken his direction because a Centrelink officer had told her that the property was still effectively jointly owned by both AHS and ILS as they were only separated by illness.
MD states that the certificate of loss issued on 18 June 2010 (see above) allows for all the accepted property expenses of $5,874.82, when only 50% should have been allowed to reflect ILS' half share in the property.
The application made under s 80(6a) of the GA Act, determined in ILS and to which the cost application refers, was heard under the Tribunal's review jurisdiction. Section 87(4) of the SAT Act is therefore relevant to the exercise of the Tribunal's discretion.
The purpose of mediation is to achieve the resolution of the matters by a settlement between the parties (s 54(4) of the SAT Act). The applicant submits that the terms of a settlement were established with the respondent at the mediation and that the Deed reflected the matters agreed to.
I accept the submission of the applicant. The respondent herself admits that she agreed to sign the Deed, albeit that she says she agreed to do so because she wanted the proceedings to finish. The evidence demonstrates that the mediation process was thorough and involved the consideration of the Deed not only by the respondent but also by her lawyer.
Although I accept that the process would have been very stressful for the respondent and that any mediation involves parties adjusting their positions in the course of negotiations, on the evidence before the Tribunal, the applicant was entitled to believe at the end of the mediation and after discussion with the respondent's lawyer that the matter had settled.
In light of my findings on the represented person's credibility in the determination of the application under s 80(6a) of the GA Act (ILS at [187] – [219]) and in the context of the evidence before me in this matter, I am satisfied that the respondent did not, in the conduct of the entire proceedings, genuinely attempt to assist the applicant to make a decision on the merits. The mediation process was but one aspect of the proceedings, but is an example where, in my view, the respondent, by her actions, unnecessarily prolonged the proceedings and did not act reasonably in the attempts to come to a settlement.
The applicant incurred costs which he might otherwise have avoided and should be compensated for the costs incurred.
Order
For the above reasons, I make the following order:
1.The respondent pay to the applicant the sum of $3,295 by way of costs in the proceedings ILS and SK [2012] WASAT 203.
I certify that this and the preceding [42] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
___________________________________
MR J MANSVELD, MEMBER
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