JB and KH
[2014] WASAT 152
•11 NOVEMBER 2014
JB and KH [2014] WASAT 152
| STATE ADMINISTRATIVE TRIBUNAL | Citation No: | [2014] WASAT 152 | |
| GUARDIANSHIP AND ADMINISTRATION ACT 1990 (WA) | |||
| Case No: | GAA:2164/2014 | DETERMINED ON THE DOCUMENTS | |
| Coram: | MR D AITKEN (MEMBER) | 11/11/14 | |
| 25 | Judgment Part: | 1 of 1 | |
| Result: | Costs order made | ||
| B | |||
| PDF Version |
| Parties: | JB CB KH SB |
Catchwords: | Guardianship and administration Applications for orders for guardianship, administration and intervention in an enduring power of attorney Applications withdrawn at hearing Application for costs under s 87(2) of the State Administrative Tribunal Act 2004 (WA) Factors to be considered in determining a costs application under the Guardianship and Administration Act 1990 (WA) Costs ordered to be paid Whether a costs order can be made under s 87(2) of the State Administrative Tribunal Act 2004 (WA) against a party other than an applicant in a proceeding under the Guardianship and Administration Act 1990 (WA) |
Legislation: | Courts and Tribunals (Electronic Processes Facilitation) Act 2013 (WA), s 17, s 18 Guardianship and Administration Act 1990 (WA), s 3(1), s 4(3), s 16, s 40, s 40(1), s 43(1), s 64(1), s 64(1)(a), s 97(1), s 109, s 109(1)(c), s 112(4) State Administrative Tribunal Act 2004 (WA), s 5, s 9(b), s 32(7), s 34, s 36, s 37(3), s 87(1), s 87(2) |
Case References: | Marvelle Investments Pty Ltd and Argyle Holdings Pty Ltd [2010] WASAT 125 (s) Pearce & Anor and Germain [2007] WASAT 291 (S) Perth Central Holdings Pty Ltd and Doric Constructions Pty Ltd [2008] WASAT 302 PJC and RJC [2008] WASAT 224 Re The Full Board of the Guardianship and Administration Board [2003] WASCA 268 |
Summary | JB and CB sought payment of their legal costs incurred in respect of applications made to the Tribunal by KH seeking the appointment of a guardian for an administrator of the estate of JB (who is the mother of KH and CB) and intervention in an enduring power of attorney made by JB, which appointed CB as her attorney.,JB had instituted proceedings in the Supreme Court of Western Australia, through a lawyer, seeking the appointment of an independent trustee of two family trusts of which she is a beneficiary and the payment of monies which JB claims are owed to her by the family trusts. Those proceedings are being contested by four of JB's five children, with only CB supporting her claims.,In statements filed with the Tribunal, KH and her brother, SB made serious allegations regarding the capacity of JB and the conduct of both JB and CB. Both JB and CB were legally represented in the proceedings.,A Doctor's Guide from JB's long standing GP, was provided to the Tribunal, which stated that JB has full decisionmaking capacity and KH withdrew the applications. JB and CB applied for costs to be awarded to them against both KH and SB. ,The Tribunal considered the principles applicable to an application for costs under s 87(2) of the State Administrative Tribunal Act 2004 (WA) in a proceeding under the Guardianship and Administration Act 1990 (WA) and decided to exercise its discretion to order that KH pay costs to both JB and CB, which it fixed at $3,000 each.,The Tribunal also decided that SB was a party to the proceedings by virtue of the definition of 'party' in s 3(1) of the Guardianship and Administration Act 1990, because he was a person who was given notice of the hearing of the applications, and therefore a costs order could be made against him under s 87(2) of the State Administrative Tribunal Act 2004. However, the Tribunal decided not to make a costs order against SB. |
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL ACT : GUARDIANSHIP AND ADMINISTRATION ACT 1990 (WA) CITATION : JB and KH [2014] WASAT 152 MEMBER : MR D AITKEN (MEMBER) HEARD : DETERMINED ON THE DOCUMENTS DELIVERED : 11 NOVEMBER 2014 FILE NO/S : GAA 2164 of 2014
- GAA 2165 of 2014
GAA 2387 of 2014
- CB
Applicants
AND
KH
SB
Respondents
Catchwords:
Guardianship and administration Applications for orders for guardianship, administration and intervention in an enduring power of attorney Applications withdrawn at hearing Application for costs under s 87(2) of the State Administrative Tribunal Act 2004 (WA) Factors to be considered in determining a costs application under the Guardianship and Administration Act 1990 (WA) Costs ordered to be paid Whether a costs order can be made under s 87(2) of the State Administrative Tribunal Act 2004 (WA) against a party other than an applicant in a proceeding under the Guardianship and Administration Act 1990 (WA)
Legislation:
Courts and Tribunals (Electronic Processes Facilitation) Act 2013 (WA), s 17, s 18
Guardianship and Administration Act 1990 (WA), s 3(1), s 4(3), s 16, s 40, s 40(1), s 43(1), s 64(1), s 64(1)(a), s 97(1), s 109, s 109(1)(c), s 112(4)
State Administrative Tribunal Act 2004 (WA), s 5, s 9(b), s 32(7), s 34, s 36, s 37(3), s 87(1), s 87(2)
Result:
Costs order made
Summary of Tribunal's decision:
JB and CB sought payment of their legal costs incurred in respect of applications made to the Tribunal by KH seeking the appointment of a guardian for an administrator of the estate of JB (who is the mother of KH and CB) and intervention in an enduring power of attorney made by JB, which appointed CB as her attorney.
JB had instituted proceedings in the Supreme Court of Western Australia, through a lawyer, seeking the appointment of an independent trustee of two family trusts of which she is a beneficiary and the payment of monies which JB claims are owed to her by the family trusts. Those proceedings are being contested by four of JB's five children, with only CB supporting her claims.
In statements filed with the Tribunal, KH and her brother, SB made serious allegations regarding the capacity of JB and the conduct of both JB and CB. Both JB and CB were legally represented in the proceedings.
A Doctor's Guide from JB's long standing GP, was provided to the Tribunal, which stated that JB has full decisionmaking capacity and KH withdrew the applications. JB and CB applied for costs to be awarded to them against both KH and SB.
The Tribunal considered the principles applicable to an application for costs under s 87(2) of the State Administrative Tribunal Act 2004 (WA) in a proceeding under the Guardianship and Administration Act 1990 (WA) and decided to exercise its discretion to order that KH pay costs to both JB and CB, which it fixed at $3,000 each.
The Tribunal also decided that SB was a party to the proceedings by virtue of the definition of 'party' in s 3(1) of the Guardianship and Administration Act 1990, because he was a person who was given notice of the hearing of the applications, and therefore a costs order could be made against him under s 87(2) of the State Administrative Tribunal Act 2004. However, the Tribunal decided not to make a costs order against SB.
Category: B
Representation:
Counsel:
Applicants : Mr C Bailey and Mr P Donovan
Respondents : In person
Solicitors:
Applicants : Williams+Hughes and MDS Legal
Respondents : N/A
Case(s) referred to in decision(s):
Marvelle Investments Pty Ltd and Argyle Holdings Pty Ltd [2010] WASAT 125 (s)
Pearce & Anor and Germain [2007] WASAT 291 (S)
Perth Central Holdings Pty Ltd and Doric Constructions Pty Ltd [2008] WASAT 302
PJC and RJC [2008] WASAT 224
Re The Full Board of the Guardianship and Administration Board [2003] WASCA 268
Introduction
1 On 28 May 2014, KH commenced these proceedings by filing applications (the applications) under the Guardianship and Administration Act 1990 (WA) (GA Act) concerning her mother, JB. The applications were firstly, an application under s 40(1) of the GA Act (s 40 application) for a guardianship order for, and an administration order in respect of the estate of JB, and secondly, an application under s 109(1)(c) of the GA Act (s 109 application) for intervention in an enduring power of attorney made by JB (the enduring power of attorney), which appointed her daughter, CB as her attorney.
JB is 80 years of age and has five children:
• KH, a daughter aged 58;
• SB, a son aged 57;
• TJ, a daughter aged 55;
• CB, a daughter aged 53; and
• RB, a son aged 51.
2 JB and her five children are the directors of two companies (trustee companies), which are the respective trustees of two family trusts (family trusts) established many years ago by JB and her late husband. The family trusts hold property estimated to be worth approximately $10 million, including a farm on which JB resides.
3 Since mid2013, JB has commenced two separate proceedings in the Supreme Court (Supreme Court proceedings). The first of those proceedings seeks the appointment of independent trustees for each of the family trusts and the second proceeding seeks payment of monies which JB claims are owed to her by the family trusts. CB supports the granting of the relief sought by JB in the Supreme Court proceedings, but the other children oppose it.
4 The s 40 application states that the applicants are KH and SB, but it has only been signed by KH. The s 109 application states that the applicant is KH.
5 The applications were stated to be urgent, because '[JB] is living on horse feed and cannot afford medicines despite having $125,000 in cash'.
6 The applications were poorly prepared, with many parts of the application forms not completed. In particular, the part of the s 40 application which requires the applicant to state the mental disability of JB was not completed. The application form is designed to make it fairly simple for the applicant to indicate the particular type of mental disability which the person the subject of the application is considered to have. The form contains four boxes, which can be ticked, and which correspond to the four particular types of mental disability included in the definition of that term in s 3(1) of the GA Act, namely intellectual disability, psychiatric disability, acquired brain injury and dementia. There is also a box for any other type of mental disability to be stated, since the definition of that term in s 3(1) is not exhaustive.
7 The applications were accompanied by a six page statement by KH (supporting statement), with 16 attachments. The supporting statement says that KH is making the application because she is concerned about the health, wellbeing and safety of her mother and seeks the following orders:
• An order 'regarding concern that an attorney - CB is not meeting her obligations nor acting in the best interests of the donor JB and the donor is no longer able to make reasonable judgments';
• An order requiring CB, as the attorney for JB, to file with the Tribunal and serve on KH a copy of all records and accounts kept by CB of dealings and transactions made by her in connection with the power and further requiring such records and accounts to be audited;
• Revocation of the enduring power of attorney and the appointment by the Tribunal of 'a new independent attorney' to manage the financial and property affairs of JB; and
• The resignation of JB from the boards of the trustee companies 'as she doesn't have the capacity to discharge her duties as a director' and the resignation of JB as an appointor and guardian of the family trusts.
8 The supporting statement alleges that JB is 'living on horse feed' in the form of 'reject WeetBix', which are 'crawling with weevils'. It also refers to a recent letter to KH and her siblings from JB's lawyer which states that JB cannot currently afford to pay for various personal expenses, including food, medication, air conditioning in her house and vehicle expenses and that JB 'cannot afford for the inactivity and dysfunction of the trustee companies to continue'.
9 The supporting statement refers to the Supreme Court proceedings and says that CB is 'facilitating' JB undertaking that legal action to seek to benefit CB favourably over her siblings.
10 The supporting statement alleges 'unethical' conduct by JB regarding the renting out of a house on the farm where JB lives and says that the matter has been reported to Centrelink.
11 The supporting statement alleges that JB does not understand her responsibilities as a company director and meeting procedures and lacks the capacity to run the farm on which she resides.
12 Finally, the supporting statement says that until late 2012, JB had 'reasonable personal and telephone contact' with all her children, grandchildren and great grandchildren, but this has changed since the legal action and family members cannot now 'keep an eye on her' as she refuses to answer phone calls and 'her lawyers have instructed her not to talk to family members … nor to take money from family members – other than [CB's husband] and CB'. KH says that this lack of family contact is distressing to all involved.
13 In keeping with the objectives of the Tribunal, set out in s 9(b) of the State Administrative Tribunal Act 2004 (WA) (SAT Act), to act speedily and with as little formality as is practicable, and the Tribunal's standard approach to applications made under the GA Act, the applications were accepted, as filed, and listed for hearing.
Directions order
14 Pursuant to s 34 of the SAT Act, I made a directions order on 11 June 2014 which provided, relevantly, that:
• The applications were listed for hearing on 25 July 2014.
• Notice of the hearing was to be given to JB, KH, SB, CB, TJ, RB, the Public Advocate and the Public Trustee.
• The applicants, were required to file a statement of the mental disability of JB for the purpose of s 64(1)(a) of the GA Act.
• The parties were informed of their right to apply under s 112(4) of the GA Act for access to inspect documents lodged with the Tribunal for the purposes of the proceeding.
• The applications were referred to the Public Advocate for investigation under s 97(1) of the GA Act.
• CB was required to file a copy of the enduring power of attorney and a statement of assets and liabilities and income and expenditure of JB.
• The Executive Officer of the Tribunal was required to provide a copy of the Tribunal's Doctor's Guide to JB's general practitioner, Dr MS and request Dr MS to complete that document and return it to the Tribunal.
Statement of mental disability
15 The reason for the direction that the applicants file a statement of the mental disability of JB was because, for an administration order to be made, the Tribunal must be satisfied under s 64(1)(a) of the GA Act that the person the subject of the application is unable, by reason of a mental disability, to make reasonable judgments in respect of matters relating to all or any part of their estate. As I have already stated, the term 'mental disability' is defined in s 3(1) of the GA Act and the s 40 application form provides for the particular type of mental disability to be indicated.
16 On 25 June 2014, the Tribunal received from KH, a six page 'statement of the mental disability of JB'. It does not state a mental disability for the purpose of s 64(1)(a) of the GA Act. Instead, it states:
I have concerns for [JB's] mental state and overall safety for the following reasons:
• Occupational health and safety.
• Social isolation.
• Inability to manage her personal financial affairs.
• Inability to discriminate personal versus business financial interests.
• Inability to understand lawful requirements.
• Making a range of decisions that are against her best interests.
• Forgetfulness on important company and trust activities which put her and the trust at risk.
17 KH's statement then provides details under headings for each of the above points and concludes by stating:
I believe that my mother lacks the capacity to understand how her decisions impact on others, she lacks the capacity to understand her business affairs, she is forgetful, is posing a risk to others and herself, she is developing paranoia, doesn't understand legal obligations and acts in a way that is not benefiting herself. I believe that she is being isolated, exploited, and cut off from her extended family due to either diminished decision making capacity or the fear of losing the only member of the family who is 'close' to her.
Doctor's Guide from Dr MS
18 On 7 July 2014, in response to the request made by the Executive Officer, the Tribunal received a completed Doctor's Guide from Dr MS dated 1 July 2014. It states that Dr MS has been JB's general practitioner for 10 years and 11 months, that she saw JB on 1 July 2014, and that JB does not have any impairment of her cognitive ability or mental function. Dr MS states that JB is capable of making reasonable decisions in relation to her personal health care, her living situation and her financial affairs and that she has the capacity to make an enduring power of attorney.
19 In the Doctor's Guide, Dr MS refers to a 'MMSE' done on 1 July 2014 with a score of 30 out of 30. MMSE is the acronym for 'mini mental state examination', which is a 30 point questionnaire used by medical professionals to measure cognitive impairment. Dr MS states that she does not often see JB, but she has not changed, according to Dr MS, in her behaviour or attitude since she had last seen her in February 2013.
Submission from CB
20 On 7 July 2014, the Tribunal received a letter from MDS Legal dated 4 July 2014 (MDS letter) advising that they act for CB and had been given the notice of hearing listing the applications for hearing on 25 July 2014 and the directions order made on 11 June 2014.
21 The MDS letter states that CB disputes the need for there to be any orders made under the GA Act in relation to her mother and refers to the Supreme Court proceedings, which the letter says are complicated and have a long history.
22 The MDS letter further says that the apparent contention by KH and SB that their mother needs the appointment of an administrator and guardian is 'entirely without foundation and without any merit'. It notes that JB is represented in the Supreme Court proceedings by Williams+Hughes and that there has not been any suggestion by those lawyers that JB might be in need of such an appointment being made. The letter requests that the matter be listed for a directions hearing on a date prior to the hearing listed for 25 July 2014 and states that costs will be sought by CB against the applicants in these proceedings.
23 The MDS letter then refers to the direction made on 11 June 2014 that CB file a copy of the enduring power of attorney and a statement of assets and liabilities and income and expenditure of JB. The letter encloses a copy of the enduring power of attorney, but says that CB is not in a position to provide the statement of assets and liabilities and income and expenditure, because CB does not manage or otherwise have the knowledge of the financial affairs of JB.
24 The MDS letter was copied to Lavan Legal (the lawyers acting for KH, SB and TJ in the Supreme Court proceedings), the Public Trustee, the Public Advocate, RB and Williams+Hughes.
Submission from JB
25 On 7 July 2014, the Tribunal received a letter from Williams+Hughes dated 7 July 2014 (WH letter) advising that they act for JB and have been acting for her for over a year in respect of the Supreme Court proceedings, which arise from a dispute between JB and her children in relation to the operation of the family trusts, of which JB is a beneficiary.
26 The WH letter says that an understanding of the Supreme Court proceedings is fundamental to the applications. It goes on to say that the majority of the assets that JB and her late husband built up over their lives were vested into the family trusts and that JB and her five children are the directors of the trustee companies. The letter says that JB's position, as plaintiff in the Supreme Court proceedings, is that she has been denied her due entitlements both as a beneficiary and creditor of the trusts, being recorded in the books of the trusts as being owed around $4.5 million.
27 The WH letter then states:
It is notable that the two applicants in the present case are children of [JB] who have vigorously opposed, at every step, [JB's] attempts to receive her due entitlements from the trusts, despite it having been acknowledged by all directors that her maintenance is a paramount objective of the trusts. It is of course ironic that one of the main grounds relied upon by the applicants in seeking guardianship and administration orders is [JB's] living conditions and lack of means, when the applicants' conduct in the Supreme Court proceedings is a key reason for such a situation occurring.
We speak to [JB] by phone and in person on a regular basis and have never seen or heard anything which gives us concern about her mental capacity or ability to manage her own affairs. It is notable that [JB] has recently attended meetings or mediations, and communicated on her own behalf, before a number of eminent members of the WA legal profession, including Registrar Christopher Boyle, the Hon. Neville Owen and Matthew Zilko SC. None have ever raised any concern about [JB's] capacity. The applicants were also in attendance on those occasions.
We understand Dr [MS] will shortly be filing an assessment which will, in broad terms, be in concurrence with our own views.
We do not consider that is reasonably possible hold a view that she is unable to manage her own affairs, and, given the antagonism between the applicants and [JB], there is a strong inference that the present applications are nothing more than an abuse of process, designed to cause [JB] suffering and hardship, both emotional and financial. It is notable that one of the orders sought by the applicants is to have [JB] resign from the boards of the trustee companies and to resign as an appointor and guardian of the trusts, something which would tactically advantage the applicants in relation to the Supreme Court litigation.
[CB], who holds the EPA, is the only director/child of [JB] who has supported her in the Supreme Court proceedings. Again, it may be inferred that the application to revoke or vary the terms of the EPA is an abuse of process given [CB's] stance in the pre-existing litigation. [JB] has informed us that she is unaware of [CB] having acted in any way as alleged by the applicants, i.e. not 'meeting her obligations nor acting in the best interests of the donor'. Likewise, we have not ourselves seen any evidence of such conduct.
We support [MDS Legal's] request that the matter be brought on for directions prior to the substantial hearing listed on 25 July 2014. In addition to [their] reasons, we understand that the applicants have not complied with orders requiring them to provide evidence of disability. The application should not proceed to hearing without such evidence (which, for the reasons set out above, will not be able to be obtained from a medical professional). We too are instructed to seek costs against the applicants.
28 The WH letter was copied to the Public Trustee, the Public Advocate, Lavan Legal, MDS Legal and RB.
Submission from SB
29 On 9 July 2014 the Tribunal received an 18 page submission from SB, with nine attached documents. In his submission, SB states that in correspondence he had been named as an applicant, but that is not the case and that, whilst he supports the applications, he did not make them.
30 The submission states that SB's 'key concerns' in relation to JB, are:
• Despite JB having had access to funds in excess of $290,000 in the 2014 financial year SB was advised by letter from JB's lawyer in late May 2014 that she had no money for food, medicines or fuel.
• JB being unable to fund necessities is a continuation of the long demise of her circumstances greatly contributed to by the maladministration by her attorney, CB.
• JB's lack of funds for the necessities of life is because she has been coerced into spending substantial amounts on law suits against her children and trustee companies of which her children are directors.
• The law suits, if not brought, and continued, at the behest of CB have certainly been brought and continued under the undue influence of CB and with a view to benefitting CB.
• JB does not appear to understand that, as plaintiff, the Supreme Court proceedings have been brought against her children by her or the rationale for the first proceeding.
• JB's attorney, CB, is more concerned with ingratiating herself with JB than caring for her in an effort to secure herself an 'early inheritance' of all of JB's assets.
• CB and her husband are taking advantage of JB's situation by funding the litigation either through loans to her secured against a property owned by JB or are looking to buy it to provide funding to JB for the litigation.
• CB has allowed JB to be preyed upon by unscrupulous individuals.
• SB understands that JB was eating weevil ridden horse feed.
31 SB then goes on to detail the following 'issues':
• JB having been subjected, through the actions of her attorney, to isolation from her family and the community at large, estrangement from her family, neglect, financial neglect, abuse and exploitation by family members and by unrelated third parties.
• JB's inability to make reasonable judgments in managing her financial affairs.
• 'Indicia' which, in SB's view, 'point toward mental disability', although SB also states that he understands that a medical professional would be meeting with JB to provide a professional opinion on whether or not JB has a mental disability.
32 SB then states, under the heading of 'health' that JB's 'diminished capacity' has twice been considered a factor by courts. The first is a comment in an affidavit by JB's husband that as a result of a stroke suffered by JB in July 2001, her memory in relation to names, is not as good as it used to be and memory of events is bound to have faded. The second is a comment in a letter by CB's husband that JB 'has some significant health problems'.
Access to documents lodged with the Tribunal
33 Both Williams+Hughes and MDS Legal applied, on behalf of JB and CB respectively, for access to the documents lodged with the Tribunal for the purpose of the proceeding and I made orders under s 112(4) of the GA Act granting that access, subject to the conditions stated in those orders.
Directions hearing
34 In response to the requests by MDS Legal and Williams+Hughes, the proceedings were listed for a directions hearing on 17 July 2014 (directions hearing), which was attended by JB and her legal representative, Mr Bailey of Williams+Hughes, CB and her legal representative, Mr Donovan of MDS Legal, KH, SB, RB, Mr Coniglio of the Office of the Public Advocate and a number of other members of JB's family.
35 At the beginning of the directions hearing I explained the following:
• That under s 4(3) of the GA Act there is a presumption that every person has full capacity for decision-making until the contrary is proved to the satisfaction of the Tribunal.
• That for an administration order to be made under s 64(1) of the GA Act, as the starting point, the Tribunal must be satisfied that JB is unable to make reasonable judgments in respect of her estate by reason of a 'mental disability' as defined in s 3(1) of the GA Act.
• That for a guardianship order to be made under s 43(1) of the GA Act, whilst the criteria are broader than they are for an administration order, as the starting point generally, the Tribunal must be satisfied that JB is unable to make reasonable judgments in respect of matters relating to her person due to a lack of decision-making capacity.
• That, although there is not a requirement that there be a lack of capacity on the part of a donor of an enduring power of attorney for an order to be made under s 109(1) of the GA Act, it would need to be an extraordinary situation for the Tribunal to do so if the donor still has the capacity to make, and therefore also to revoke, an enduring power of attorney.
36 I then referred to the assertion which had been made by SB that, whilst he has been named as an applicant in the s 40 application, he did not sign that application and he says that he is not an applicant. In response to that, KH said that she did not realise what she was doing when she filled out the s 40 application form and that she 'accidentally' stated SB as an applicant. KH stated that she is the only applicant. SB then said that when he received a letter from the Tribunal which noted him as an applicant he called the Tribunal and left a voice message stating that he was not the applicant.
37 Mr Donovan, as the legal representative for CB, said that he did not accept that explanation and contends that SB is an applicant. Mr Donovan said that SB is openly supporting the applications and has filed a very lengthy submission in support of the applications. Mr Bailey, as the legal representative for JB, supported that contention.
38 Mr Coniglio from the Office of the Public Advocate then said that when he received the direction to investigate the matter he had spoken to a number of family members and encouraged them to make submissions, so that might explain why SB filed his submission.
39 I then went through the Doctor's Guide which the Executive Officer had sent to Dr MS, and which Dr MS had completed and returned to the Tribunal. I said that the information provided by Dr MS in the Doctor's Guide makes it clear that, in the opinion of Dr MS, JB has full decisionmaking capacity, both in respect of her personal affairs and her financial affairs, and the capacity to make an enduring power of attorney.
40 I then asked KH, since she was saying that she is the sole applicant, what she wished to do regarding the applications, in light of the Doctor's Guide from Dr MS. KH was quite evasive in addressing that question, but eventually stated that she wished to withdraw the applications.
41 JB and CB, through their legal representatives, stated that they did not object to that, but wished to apply for an order that KH and SB pay their costs. RB also stated that he wished to apply for costs.
42 I gave leave for the applications to be withdrawn and ordered that they were withdrawn, with liberty to JB, CB and RB to apply for costs, by filing with the Tribunal and giving to KH and SB, on or before 1 August 2014, a schedule of costs claimed and supporting submissions. The order provided that KH and SB may file submissions in opposition on or before 15 August 2014, and that the Tribunal would then determine the application for costs on the documents and, if costs are awarded, fix the amount of those costs.
Application for costs
43 On 21 July 2014, RB notified the Tribunal that he would not apply for costs.
44 On 1 August 2014, JB and CB filed an application for costs (costs application) against KH and SB, consisting of separate schedules of the costs claimed by JB and CB respectively and a joint submission.
45 JB and CB submit that both KH and SB are the applicants in the proceedings. They say that KH gave a 'wholly unconvincing' explanation during the directions hearing on how it was that SB was named as an applicant on the application form filed by KH. They also say that SB, who is a qualified legal practitioner, took no effective or decisive steps to make it clear that he was not an applicant until he lodged his 18 page submission with the Tribunal on 9 July 2014. They say that, therefore, SB is either a party as a named applicant or, alternatively, SB is a person intervening in the proceedings.
46 JB and CB contend that they should be awarded their costs for the following reasons:
• KH and SB could never have reasonably had any legitimate concerns about the capacity of JB.
• KH and SB were written to by their solicitors (in the Supreme Court proceedings), Lavan Legal on 2 July 2014 referring to comments made by Mr Matthew Zilko SC (in his role as independent chairman of meetings of the directors of the trustee companies) about the risks of the applications and the prospect of adverse costs orders, but they still chose to proceed with the applications.
• The 'fundamental justification' underlying the applications and submissions of concern about JB's impecuniosity is 'entirely disingenuous' in circumstances where KH and SB have repeatedly blocked attempts by JB to obtain funds from the family trusts.
• The submissions filed by KH and SB contain a selective, misleading or inaccurate history of the matter.
• Documents were filed with the Tribunal in breach of the implied undertaking which applies to documents filed with the Supreme Court that documents obtained in those proceedings cannot be used for other purposes.
• In light of the above matters, it is open to the Tribunal to infer that the applications were made in bad faith, in a tactical attempt to cause JB and CB to incur additional legal fees in 'defending' the applications and to weaken their ability to pursue the Supreme Court proceedings.
• No evidence was provided to justify CB being removed as the enduring power of attorney.
Response by KH
47 On 15 August 2014, KH filed a submission in response to the costs application (KH response).
48 In the KH response KH states:
Following my son's visit to the farm I phoned various organisations to find out what I could do to help my mother, these included ACAT, Advocare, The Public Advocate's office, The Public Trustee, the human rights officer at SAT, Legal Aid and the Citizen's Advice Bureau. I was advised by several of these agencies that I could apply to SAT for an independent guardian and an independent administrator to be appointed for my mother.
49 KH further states that she got advice from a lawyer who helped her to write out her submission and who also offered to represent her at the Tribunal. KH then says that she declined that offer as she has limited resources and a number of people whom she contacted in the various agencies said that it was not common for people to be legally represented and she was advised of the 'user pays system' of the Tribunal.
50 KH states that her relationship with JB has always been on a friendly basis and never on a hostile basis and then says that recently JB has become very hostile towards her.
51 KH then states that she phoned Dr MS and was told that she had not seen JB since March 2013 and that JB has significant health issues requiring regular check-ups. KH says that with her son telling her that JB is living on horse feed, letters from JB's lawyers saying that JB is relying on neighbours and friends for food and not being able to afford medication, despite having access to significant amounts of money, suggests to her that something concerning is happening. KH says that JB's behaviour has changed dramatically in the past two years and she questions whether JB has the early onset of dementia or some other mental problem. KH says that she was advised by a social worker, who is part of an Aged Care Assessment Team, that JB could be in the early stages of dementia.
52 KH states that the comments made by Mr Zilko, referred to in the costs application, are offensive and an attempt to intimidate her and that Mr Zilko had no knowledge of what the applications were about and should not have made any comment.
53 KH concludes by saying that having a 'SAT ordered assessment of JB' was the only avenue open to her to find out the true nature of JB's capacity and that once she heard Dr MS's report, she dropped the applications.
Response by SB
54 On 15 August 2014, SB filed a submission in response to the costs application (SB response).
55 There are two aspects to the SB response. Firstly, SB contends that he cannot be liable to be subject to a costs order under s 87(2) of the SAT Act because he is not a party to the proceedings. Secondly, SB contends that the 'usual rule as to costs under s 87 of the SATAct should apply and each party should bear its own costs'.
56 In respect of the first aspect of the SB response, he says that he was neither a party to the proceedings as an applicant, nor as a person intervening in the proceedings. SB says that he is simply a person who made a submission at the request of the Office of the Public Advocate.
57 SB says that KH, who signed and filed the applications, had no express authority to name him as an applicant in the applications and there is no basis on which it can be asserted that KH had 'apparent, ostensible or any other authority' to name him as an applicant.
58 SB says that when he received a letter from the Tribunal on 30 May 2014, acknowledging receipt of the applications, he immediately telephoned the Tribunal and left a voice message which stated, amongst other things, that he had been wrongly named as an applicant. SB says that the Tribunal 'has a duty to ensure that all relevant material is disclosed to the Tribunal' and refers to s 32(7) of the SAT Act as authority for that contention. SB then contends that the voice message 'was an electronic message under the Courts and Tribunals (Electronic Processes Facilitation) Act 2013 (WA)(CTEPF Act) required to be produced (by operation of the SAT Act) under s 17 of the CTEPF Act' and that pursuant to s 18 of that Act the voice message 'has the same effect as if it were a paper document'. SB then says that it follows that 'effective notice' of him being wrongly named as an applicant was given to the Tribunal 'at the earliest possible point in time being 30 May 2014'.
59 SB says that in his submission which he lodged with the Tribunal on 9 July 2014 in support of the applications, at the request of Mr Coniglio of the Office of the Public Advocate, he advised that he was not an applicant.
60 SB disputes the contention of JB and CB that he is a party by reason of 'intervening' in the proceedings. He says that to intervene he would require the leave of the Tribunal under s 37(3) of the SAT Act, which he did not seek and which the Tribunal did not grant.
61 In respect of the second aspect of the SB response, he says that it was reasonable for KH to make the applications and for others, including him, to file submissions in support of the applications, because there were real questions as to JB’s capabilities. He says that the applications were withdrawn at the earliest possible time, when the applicant KH was made aware, at the directions hearing, that there was not sufficient evidence to displace the presumption of capacity. He also says that, as the applicant was not legally represented, there was no need for legal representation for either JB or CB, particularly for CB, and even if legal representation were required there was no need for separate representation for each of them.
62 Finally, SB says that the costs claimed for much of the work detailed in the costs schedules should be disallowed or taxed because it was unnecessary.
Statutory framework
63 Section 87(1) and s 87(2) of the SAT Act state:
(1) Unless otherwise specified in this Act, the enabling Act, or an order of the Tribunal under this section, parties bear their own costs in a proceeding of the Tribunal.
(2) Unless otherwise specified in the enabling Act, the Tribunal may make an order for the payment by a party of all or any of the costs of another party or of a person required to produce a document or other material on the application of the party under section 35.
64 The enabling Act in this matter is the GA Act. Section 16(4) of the GA Act provides that in proceedings under that Act, in certain circumstances, the Tribunal may order that the costs of a party be paid from the estate of the person in respect of whom an application is made. Section 16(5) of the GA Act provides that nothing in s 16 limits any other power of the Tribunal under the SAT Act. Therefore, the power to order costs under s 16(4) is additional to, and not restrictive of, the power of the Tribunal to award costs under s 87(2) of the SAT Act.
65 The application for costs in this proceeding has been made under s 87(2) of the SAT Act. There is no application for costs under s 16(4) of the GA Act.
The discretion to award costs under s 87(2) of the SAT Act
66 The starting point in proceedings in the Tribunal, under s 87(1) of the SAT Act, is that parties bear their own costs. However, the Tribunal has a broad discretion to award costs, under s 87(2) of the SAT Act, if it decides that it is appropriate to do so.
67 In Pearce & Anor and Germain [2007] WASAT 291 (S), at [22] the Tribunal made the following comments regarding the discretion to award costs under s 87(2) of the SAT Act:
In Summerville, Barker J observed that s 87 does not identify factors to be taken into account by the Tribunal in exercising its jurisdiction under s 87(2), and it is not appropriate for the Tribunal to attempt finally to delineate the particular circumstances in which the discretion to award costs will be exercised. Costs orders have most commonly be (sic) made in the Tribunal in circumstances of the type identified by Deputy President Judge Eckert in Chew and Director-General of the Department of Education and Training [2006] WASAT 248 at [85], being circumstances where a party has conducted itself unreasonably or inappropriately, particularly where that conduct gives rise to unnecessary costs being incurred by the other party.
68 In PJC and RJC [2008] WASAT 224, the Tribunal considered the exercise of the discretion to award costs under s 87(2) of the SAT Act in a proceeding under the GA Act and, at [56] [58], stated:
Whilst it is accepted that the primary intent of the GA Act is the protection of adults under a disability (see EM Heenan J in Re The Full Board of the Guardianship and Administration Board [2003] WASCA 268 at [43] and [44]), and this can result at times, in the making of applications of a somewhat exploratory nature, it is nevertheless the case that an applicant has a responsibility to consider the substance of (and intent behind) the application that he or she is making before proceeding with the application.
The making of administration and guardianship applications under the GA Act are very intrusive and lead to the exploration of sensitive issues in a person's life. They should not be made lightly.
A fundamental element then, in the task for an applicant, is the need to have a reasonable belief, objectively grounded, that the person for whom protection is sought is no longer capable of managing his or her affairs.
69 In Re The Full Board of the Guardianship and Administration Board [2003] WASCA 268 at [43] EM Heenan J stated that:
… [the GA Act] is designed for the protection of adult persons whose faculties may be impaired (emphasis added), 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 ill-considered personal decisions or action, or by unscrupulous or ill-advised influence of relatives, friends and others who may deliberately or inadvertently exploit the vulnerability of the person in need of assistance and protection.
70 The basis for the protection sought by making an application under the GA Act must be that the person the subject of the application is not capable of managing all or part of their financial and personal affairs by reason of an impairment of their faculties. An applicant must have a reasonable belief, objectively grounded, that this is the case before making an application under the Act. It is not sufficient for an applicant to simply say that they are concerned about the welfare of the person the subject of the application, or to assert that the person lacks capacity to manage their affairs.
Should costs be awarded against SB?
71 I will firstly consider whether costs should be awarded against SB.
72 SB is not stated to be an applicant in the s 109 application and, he did not sign the s 40 application although he is stated to be an applicant in it.
73 Although I find it somewhat difficult to accept KH's explanation regarding how she came to state SB as an additional applicant in the s 40 application, KH was adamant at the directions hearing that she did not intend SB to be an applicant and SB was also adamant that he was not an applicant and did not authorise KH to include him as an applicant.
74 I note that it was only KH who filed the 'statement of mental disability' in response to the directions orders.
75 In the circumstances, I have decided that the applicant for all of the applications was solely KH and that SB was not an applicant.
76 However, before moving on from that issue I must comment on SB's contentions regarding the voice message which he says that he left when he telephoned the Tribunal on 30 May 2014. I consider those contentions to be a ludicrous and injudicious attempt by SB to excuse his failure to notify the Tribunal in writing that he was not an applicant when he received the letter from the Tribunal on 30 May 2014, which indicated that he had lodged the applications. I do not accept SB's contention that under s 32(7) of the SAT Act the Tribunal has a duty to record and disclose to itself the contents of a voice message left on the Tribunal's telephone system. Section 32(7) of the SAT Act provides that the Tribunal is to ensure that all relevant material is disclosed to it for the purpose of the Tribunal determining a matter; it does not require the Tribunal to create any such material and 'disclose' it to itself. I do not consider a voice message to be 'relevant material' for the purpose of s 32(7) of the SAT Act. If Parliament intended that the Tribunal should keep a record of all voice messages left on the telephone system of the Tribunal, either electronically or in a document, it would put a specific provision to that effect in the SAT Act. Section 17 of the CTEPF Act only applies where a person is required to produce information or a document containing information, to 'a court, tribunal or person' and that person keeps a record of that information in electronic form. There is no requirement that the Tribunal produce to itself, or indeed to a court or person, information left in a voice message.
77 I accept SB's contention that he is not a party by reason of 'intervening' in the proceedings. He is correct in saying that to intervene he would require the leave of the Tribunal under s 37(3) of the SAT Act, which he did not seek and which the Tribunal did not grant.
78 Although SB is neither an applicant, nor an intervener, he is still a party to the proceedings by virtue of the definition of 'party' in s 3(1) of the GA Act, as also are TJ and RB, having been given notice of the hearing of the applications. By virtue of s 5 of the SAT Act, the definition of 'party' in s 3(1) of the GA Act, prevails over the more limited provisions in s 36 of the SAT Act regarding who is a party to a proceeding under the GA Act. Therefore, in my opinion, it is open to the Tribunal to exercise its discretion under s 87(2) of the SAT Act to make a costs order against SB as a party to the proceedings.
79 However, I have decided not to do so for the following reasons. Firstly, Mr Coniglio from the Office of the Public Advocate said, during the directions hearing, that he had encouraged SB and other members of the family of JB to lodge submissions in respect of the applications. If it were not for Mr Coniglio's evidence in that regard, I would be inclined to make a costs order against SB, in view of the fact that his submission is 18 pages long, with nine attached documents, and contains very serious allegations against both JB and CB, which justified them in seeking legal representation. Secondly, the costs application does not give any details of the costs which were incurred by JB and CB in respect of SB's submission.
80 I will now consider whether costs should be awarded against KH.
Should costs be awarded against KH?
81 In the costs application it is contended that KH and SB could never reasonably have had any legitimate concerns about the capacity of JB and that, on the contrary, it has always been clear that she was of capacity. In response to that contention, KH refers to JB having become very hostile towards her recently and making statements which KH says are untrue and which suggest to KH that 'something concerning is happening'. She also says that JB's behaviour has changed dramatically in the past two years and that she (KH) questions whether JB has the early onset of dementia or some other mental problem.
82 I do not believe that there is an objective basis for the suggestion of dementia or 'some other mental problem'. What is clear from the materials which have been filed with the Tribunal, is that during the past 18 months JB has commenced two actions in the Supreme Court against the trustee companies and, in one case, also against her children, seeking the appointment of new trustees and the payment of monies she claims are owed to her by the family trusts. That has clearly resulted in JB incurring significant legal costs and significant disputation between JB and four of her children, in particular KH and SB. In my opinion the alleged behaviour of JB, to which KH refers, is the result of that litigation. In my view, that does not provide any objective basis on which to assert, reasonably, that JB is not capable of managing her affairs or is vulnerable to exploitation due to an impairment of her faculties To the contrary, the fact that JB has been instructing her lawyer in respect of the Supreme Court proceedings for the past 18 months and that her lawyer has not had any concerns about her capacity to give those instructions is indicative of JB being capable of managing her own affairs.
83 In the KH response, KH says that she phoned various organisations 'to find out what I could do to help my mother'. However, KH has not provided details of what information she provided to the persons with whom she spoke in those organisations. The circumstances in which these applications have been made are complex and unusual. It is understandable that some of the persons with whom KH spoke would advise her that she could make applications to the Tribunal for the appointment of a guardian and an administrator if she asserted to them that her mother was suffering from a mental disability or impairment of her faculties. It would be reasonable and appropriate to make those applications if there was some evidence from a medical professional to indicate that this is the case. However, that is not the case and, as I have already stated, the surrounding circumstances here are that there is significant litigation on foot in which both JB and KH are legally represented. I believe that KH is being disingenuous in suggesting that she acted on the advice of the people referred to above when she has not provided to the Tribunal the details of what she told them. Also, KH has not provided any evidence from any of those persons.
84 In my opinion, it is telling that one of the orders sought by KH was the 'resignation' of JB from the board of the trustee companies. Not only is that an order which the Tribunal does not have the power to make under the GA Act, but also it is an outcome which is not directed towards the wellbeing or protection of JB. Instead, it is directed at removing JB from her role in the decision-making process of the trustee companies which are the subject of her Supreme Court proceedings.
85 It is all very well for KH to say that she decided not to be legally represented because of her 'limited resources'. However, because of the consequences that would result for JB, if an administration order were to be made, and the very serious allegations made against both JB and CB, it is perfectly reasonable that they chose to be legally represented in the proceedings. In the circumstances which resulted, where the Doctor's Guide from Dr MS states that JB has full capacity and JB withdrew the applications when faced with that evidence, I conclude that the legal costs of JB and CB were unnecessarily incurred as a result of KH's conduct in lodging those applications when it was unreasonable and inappropriate to do so.
86 Finally, I do not accept the contention of SB that there was no need for separate representation for JB and CB. Their interests in the proceedings were separate and distinct and, in my opinion, in view of the serious allegations made by both KH and SB against both JB and CB, it was reasonable for each of them to be separately represented.
What amount of costs should be awarded to JB and CB?
87 JB and CB have each submitted schedules of the costs which they are seeking, and which provide details of how those costs have been calculated.
88 JB is seeking costs of $3,001.19 and CB is seeking costs of $3,868.62.
89 KH has not made any submissions regarding the schedules of costs. Although I have decided that costs should not be awarded against SB, I have nevertheless considered his submissions regarding the costs schedules. SB contends that in the event that the Tribunal decides to award costs it should either disallow or 'tax' the following costs claimed by JB and CB:
• the cost of the MDS letter sent to the Tribunal on behalf of CB;
• the cost for the preparation for and attendance at the directions hearing by the legal representatives for JB and CB; and
• the preparation of the submissions in support of the application for costs.
90 As I have already stated, in my opinion, in view of the potential consequences for JB of orders being made and the serious allegations made against both JB and CB, it was reasonable and necessary for JB and CB to have legal representation for the proceeding. That necessarily involved their legal representatives sending the MDS letter and the WH letter to the Tribunal and seeking access to the documents lodged with the Tribunal and also preparing for and attending the directions hearing. Because I gave leave for JB and CB to apply for costs, it was also reasonable for their legal representatives to prepare submissions in support of the application for costs.
91 The Tribunal approaches the task of fixing costs to be awarded in a broad and relatively robust fashion; see Perth Central Holdings Pty Ltd and Doric Constructions Pty Ltd [2008] WASAT 302 at [67] and Marvelle Investments Pty Ltd and Argyle Holdings Pty Ltd [2010] WASAT 125 (S) at [49]. It does not 'tax' costs in the way that courts do.
92 Approaching the task of deciding the amount to fix as the award of costs in a broad and fairly robust fashion, without analysing the details of the work undertaken, I consider that, in all the circumstances of these proceedings, the amount of the costs claimed by JB is reasonable. I have, therefore, decided to award the amount of $3,000 to JB and I have decided to also award the same amount to CB.
93 I have decided to allow KH the period of 60 days to pay those costs.
Order
I will therefore make the following order:
1. By 10 January 2014 KH shall pay:
(a) the amount of $3,000 to JB; and
(b) the amount of $3,000 to CB.
I certify that this and the preceding [93] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
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MR D AITKEN, MEMBER
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