JC
[2012] QCAT 639
•9 November 2012
| CITATION: | JC [2012] QCAT 639 |
| PARTIES: | JC |
| APPLICATION NUMBER: | GAA4898-12 / GAA9343-12 |
| MATTER TYPE: | Guardianship and administration matters for adults |
| HEARING DATES: | 13 September and 9 November 2012 |
| HEARD AT: | Brisbane |
| DECISION OF: | Barbara Bayne, Member |
| DELIVERED ON: | 9 November 2012 |
| DELIVERED AT: | Brisbane |
| ORDERS MADE: | 1. The administration order made by the Tribunal on 1 June 2011 is changed by removing JR as administrator and appointing The Public Trustee of Queensland as administrator for JC for all financial matters. 2. The administrator is to provide a financial management plan to the Tribunal within six (6) months. 3. The Tribunal directs the administrator to provide accounts to the Tribunal when requested. 4. This appointment remains current until further order of the Tribunal. 5. That before 9 February 2013 the administrator must: (a) Search the records of the Registrar of Titles to identify any property registered in the adult’s name. (b) Give the registrar of titles a copy of this order and a notice to the registrar advising that any interest in property held by the adult is subject to this order. (c) Give to the Tribunal: (i) a copy of the “Lodgement Summary Form” from the Titles registry confirming the notice has been lodged for each property held by the adult; and (ii) a copy of the current title searches. 6. If the ownership of any property of the adult changes in any way or the adult acquires an interest in another property the administrator must, within fourteen (14) days of such changes: (a) give a copy of this order to the Registrar of Titles, and; (b) give a notice to the Registrar about the changes or the adult’s interest in another property. 7. The application for authorisation of a conflict transaction for JC is dismissed. |
| CATCHWORDS: | REVIEW OF APPOINTMENT OF ADMINISTRATOR ON THE TRIBUNAL’s INITIATIVE –- breaches of legislation – whether other person more appropriate than current appointee Guardianship and Administration Act 2000, ss 15, 29, 31, 35-37 |
APPEARANCES and REPRESENTATION (if any):
13 September 2012
JC The adult (not present at the hearing)
JR Son and administrator
9 November 2012
JC The adult (not present at the hearing)
JR Son and administrator
GPThe Public Trustee of Queensland
REASONS FOR DECISION
JC is 72 years of age and since March 2011 has been living in a residential aged care facility in Queensland.
On 1 June 2011 the Tribunal appointed her son, JR, as her administrator. A review of this appointment was initiated by the Tribunal in June 2012 due to noncompliance by the administrator.
The matter was partially heard on 13 September 2012, then adjourned with directions to 9 November 2012.
The Legislation
Under section 31 of the Guardianship and Administration Act 2000, the Tribunal must undertake a review as though the matter was coming to the Tribunal for the first time. The Tribunal, when considering the appointment of a guardian or an administrator, must be satisfied not only that JC lacks capacity for matters but also as to the need for appointment as set out in section 12 of the Act and to appropriateness of a proposed appointee as set out in sections 14, 15 and 16 of the Act.
Section 31(4) of the Act provides that the Tribunal may make an order removing an appointee and replacing that person only if the Tribunal considers that the appointee is no longer competent or another person is more appropriate for appointment.
Capacity
The first consideration was that of JC’s capacity[1]; she is presumed to have capacity in accordance with section 7 of the Act and General Principle 1 under Schedule 1 of the Act.
[1] Defined in Schedule 4 of the Guardianship and Administration Act 2000.
In a health professional report dated 21 March 2011, BB, a social worker, informs that on 11 January 2011 JC had a left middle cerebral artery infarct with resulting right hemiparesis and expressive aphasia. Ms BB considered that the aphasia caused severe receptive and expressive language difficulties and that JC was only able to follow very basic conversational speech.
In a report also dated 21 March 2011, AJ, a speech pathologist, refers to severe language impairments affecting understanding, expression, reading and writing. AJ considers that JC’s yes/no responses are unreliable and that JC does not have the ability to understand/interpret information, either spoken or written, and is therefore unable to participate in decision making.
Although at the hearing on 9 November 2012 JR advised that his mother “was deemed incompetent at the time of the stroke … but she’s not, she knows what she wants”, there is no medical evidence before me to support any improvement in JC’s condition since 2011. I therefore consider that the cerebral artery infarct continues to impact on JC’s cognitive functioning to the extent that she is not able to understand and make decisions on her own.
I am satisfied that the presumption of capacity as set out in the Act in regard to JC’s ability to make complex financial decisions for herself is rebutted.
Need for an Administrator
JC’s assets, as listed by the administrator, are at present a real estate property valued at about $350,000, superannuation valued at $6,500 and an accommodation bond held by the RACF. Although not listed by the administrator, JC also has approximately $3,945.54 in a bank account.
JC receives Centrelink entitlements of about $773/fortnight and her expenses include the RACF fees of about $2,181/month. A deficit budget of about $320/fortnight (plus real estate and other costs) is indicated.
Given the magnitude of JC’s estate, there is a clear need for the appointment of an administrator.
The Current Administrator
A number of ongoing and emerging concerns have been raised as to the actions of, or lack thereof, the current administrator, JR.
Compliance with Tribunal Directions
The first is the administrator’s difficulties with compliance[2] with the directions of the Tribunal with regards to various financial returns.
[2] See s 36 of the Guardianship and Administration Act 2000.
The order dated 1 June 2011 granted a partial exemption from the requirement to provide full accounts; the administrator was however directed to provide various financial documents to the Tribunal by 1 April 2012 (and annually thereafter). A reminder letter, giving the administrator one month to provide the specified documents, was sent on 16 April 2012. A review of the appointment was initiated when no response had been received by 18 June 2012.
The order dated 1 June 2011 also made directions concerning a notice of interest in land. Despite a reminder letter dated 20 September 2011 and a telephone call on 23 November 2011, the appropriate documents were not provided to the Tribunal. Further notice of interest in land directions were made on 13 September 2012; the returns have still not been received.
The order dated 13 September 2012 directed that an updated financial management plan be provided to the Tribunal by 1 November 2012. Limited information was received by emails in early November 2012.
JC’s Assets
Until 9 November 2012, the administrator failed to declare considerable investment funds under his management since at least 1 June 2011; various transactions through the bank account refer:
a) 20 June 2011 – deposit $13,000, withdrawn 20 June 2011. The administrator unable to explain accurately, “not 100% sure” of the source of the funds, or of how they were spent.
b) 22 June 2011 – deposit $207,293.25, withdrawn 22 June 2011, explained as funds from a term deposit, payment of the RACF bond and contribution towards the RACF fees account.
c) 7 December 2011 – deposit $35,644, withdrawn same day, explained as “guessing” came from a term deposit, payment of an invoice for exactly the same amount for renovations to JC’s property, efficacy thereof and for whose benefit unknown.
d) 13 April 2012 – deposit $1,500, source unknown/unspecified, same day payment to RACF of $9,550.
The RACF Fees
JR informed that the family had chosen the RACF for JC and that he was pleased with the level of care she receives there.
The administrator provided a copy of the latest statement from the RACF. This shows a balance of $8,315.70 as at 4 October 2012 and is notated by hand "PAID". When on 9 November 2012 the administrator was asked if the fees were up to date today, he replied “yes they are”. When this question was repeated, he qualified his reply by saying that another bill has become due, and there would be amounts owing now. JR informed that the RACF was satisfied with the fee payments/arrangements to date.
Evidence provided by the RACF however strongly contradicts this. The latest statement (as provided by the RACF) indicates that only $4,864.98 was paid on 30 October 2012, leaving a balance of $3,450.72 outstanding at the time. The balance of JC’s account as at 9 November 2012 is $5,367; a letter of demand was sent to the administrator on 18 October 2012 and a further letter of demand is now due.
A perusal of the RACF statements from March 2011 until October 2012 indicates that since March 2011 the account has continually been in arrears; five intermittent payments have been made from March 2011 to October 2012. The graph below approximates.
Source: RACF, various Resident Tax Invoice/Statements
The administrator has, by his own admission, made no effort to redirect JC’s fortnightly Centrelink benefit to the RACF. He informed that he does not pay the fee account when due owing to an ongoing disagreement with the RACF in regards to the amount of the bond[3].
[3]The evidence supports that a bond of $200,000 was paid on 23 June 2011, presumably under a contract and presumably following negotiations between the administrator and the RACF. The administrator advised on 9 November 2012 that the bond was a commercial agreement between him and the RACF.
Despite the administrator stating that he has “given up arguing about the bond”, he advised that he deliberately continues to delay payments, making these periodically “about once a quarter”, in order to exert pressure on the RACF to return some of JC’s bond.
The actions of the administrator to resolve any ongoing problems were unclear; he stated he had not sought legal advice.
The Future of JC’s Real Estate Property
On questioning by the Tribunal on 13 September 2012, JR advised that he has determined that, for a number of reasons, JC’s property should be retained. There is no evidence that the administrator has sought any professional financial investment advice, or that he has considered his obligations under the Prudent Person Rule[4].
[4] See section 24 of the Trusts Act 1973.
The administrator also advised that he was not aware of the Centrelink exemption under which the previous place of residence is not considered an asset for the purposes of calculating the age pension for a 24-month period. The administrator was not cognisant that this time period will expire in March 2013, and that this is likely to have an impact on JC’s pension entitlement.
Conflict Transaction
JR advised (for the first time) on 13 September 2012 that his sister JK and her partner reside rent free in the property. He was directed to submit an application for a conflict transaction[5].
[5] See section 37 of the Guardianship and Administration Act 2000.
The administrator explained that JK meets ”all of the personal expenses of my mother outside of her nursing home care fees (eg clothing, toiletries, hairdressing, pharmacy, taxis, lunches and dinners when out…)”. I note that the RACF statements record some (albeit reasonably minor) charges for hairdressing, raffles, lunches, clothing purchases and taxi fares.
The administrator also states that his sister “meets all of the costs associated with the property (inclusive of maintenance, rates, water sewerage and so on)”. It is not clear therefore as to why a payment on 21 December 2011 of $667.45 was made from JC’s account to a regional Council; the works undertaken to JC’s property in November 2011 ($35,644.00) are again noted.
The administrator advised that he contributes to JC’s deficit budget. It is unclear how and when he does so.
Conclusion
Although some financial returns have been provided in response to various directions, the administrator has not accounted for all assets and his financial returns continue to provide insufficient detail and very little accountability and transparency. He has not provided comprehensive and/or appropriate evidence as to JC’s financial matters under his management since 1 June 2011.
There is no objection if an administrator chooses not to use the Tribunal preferred templates[6] for financial returns. It is however of concern if the administrator continually fails to adequately address matters which the Tribunal has identified as essential.
[6]See for example A financial management plan for appointed administrators; >
It is also reprehensible that the RACF fees have been habitually, and remain, in such arrears; it is indefensible that, under the circumstances described, an RACF should have to resort to letters of demand for debt recovery for client fees.
Also of concern in this case is the existence and redemption of significant term deposits which were not declared until the administrator was directly questioned on 9 November 2012. The administrator was not immediately able to provide many comprehensive particulars of these; details of interest rates and any remaining investments were not forthcoming.
The evidence supports that the administrator has breached sections 35, 36 and 37 of the Act. Under some circumstances, these could have been remedied; in this case however the cumulative effect of various inappropriate decisions or actions demonstrates that JR is not appropriate to appoint as administrator.
I consider the JR was given the opportunity on 13 September 2012 to establish his competency. He continues however to demonstrate a limited understanding of the legislation and of his role and responsibilities as administrator. His non-compliance with directions, non-payment of bills, allowing a family member residence with no formal arrangements as to rent or payments in kind, insufficient record keeping, the breach of the prudent person rule and the non-identification or conservation of assets persuade me that he is not competent.
The only other option for appointment is The Public Trustee of Queensland; no other person has been identified as suitable. The PTQ is an active party to every matter, and is always available as a potential appointee. The PTQ is recognised as a skilled and experienced organisation, capable of exercising the care, diligence and skill needed to manage JC’s financial matters into the future. The PTQ will deal with third party family members to regularise any use of JC’s property. This will not be a conflict transaction for The Public Trustee.
I am satisfied that The Public Trustee is more appropriate for appointment as JC’s administrator at this time.
Orders are made accordingly.
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