JEB
[2016] WASAT 65
•20 JUNE 2016
JEB [2016] WASAT 65
| STATE ADMINISTRATIVE TRIBUNAL | Citation No: | [2016] WASAT 65 | |
| GUARDIANSHIP AND ADMINISTRATION ACT 1990 (WA) | |||
| Case No: | GAA:1854/2015 | 15 OCTOBER 2015 | |
| Coram: | MS H LESLIE (MEMBER) | 20/06/16 | |
| 31 | Judgment Part: | 1 of 1 | |
| Result: | Public Trustee substituted as plenary administrator with directions as to how to hold certain funds | ||
| B | |||
| PDF Version |
| Parties: | JEB |
Catchwords: | Guardianship and administration Administration Ademption Quarantining of funds Best interests |
Legislation: | Guardianship and Administration Act 1986 (Vic), s 53 Guardianship and Administration Act 1990 (WA), s 72(1), s 86, Sch 2 Pt B Guardianship and Administration Act 2000 (Qld), s 60(1) Mental Health Act 1962 (WA) NSW Trustee and Guardian Act 2009, s 83 Public Trustee Act 1941 (WA), s 58 |
Case References: | Public Trustee and BG [2010] WASAT 195 Public Trustee of Queensland v Stibbe & Anor [2012] QSC 357 Public Trustee of Western Australia and W [2012] WASAT 170 Re Hartigan; ex parte The Public Trustee in the State of Western Australia (unreported, Supreme Court of Western Australia, 9 December 1997, Library No. 970736) Re SB (unreported SAT decision, 17 September 2015) Re Viertel [1997] 1 Qd R 110 RL v NSW Trustee and Guardian [2012] NSWCA 39 Simpson v Cunning [2011] VSC 466 The Trust Company Ltd v Gibson [2012] QSC 183 |
Summary | On review of an administration order, the Public Trustee sought the removal of the existing family member joint administrators and also certain directions as to the way in which funds from the sale of certain assets of the estate should be held. Assets specifically gifted by the represented person in her Will had been sold by the administrators who were unaware of the existence of the Will. The Public Trustee was the executor of the Will. In his capacity as overseer of the administrator accounts of the estate, he sought directions from the Tribunal to the effect that the proceeds of the estate be held separately inter vivos so as to allow for the application of an exception to the principle of ademption to apply and so for the gifts under the Will to be preserved and thus the represented person's testamentary wishes not to be defeated by the actions of the administrator during her lifetime.,The administrators did not seek reappointment. The Tribunal appointed the Public Trustee as plenary administrator and made the directions sought by the Public Trustee regarding the separation of the proceeds of sale from the balance of the estate and their quarantining from use in inter vivos expenditure until the balance of the represented person's funds were depleted. The Tribunal found that affordable actions taken to maximise the chances that a represented person's testamentary wishes as reflected in a Will are able to be carried out constitutes acting in their best interests, even if it represents a financial cost to their estate inter vivos, and that it is a matter of balance for the administrator to determine depending upon the circumstances of the person and their estate. |
- Represented Person
Catchwords:
Guardianship and administration - Administration - Ademption - Quarantining of funds - Best interests
Legislation:
Guardianship and Administration Act 1986 (Vic), s 53
Guardianship and Administration Act 1990 (WA), s 72(1), s 86, Sch 2 Pt B
Guardianship and Administration Act 2000 (Qld), s 60(1)
Mental Health Act 1962 (WA)
NSW Trustee and Guardian Act 2009, s 83
Public Trustee Act 1941 (WA), s 58
Result:
Public Trustee substituted as plenary administrator with directions as to how to hold certain funds
Summary of Tribunal's decision:
On review of an administration order, the Public Trustee sought the removal of the existing family member joint administrators and also certain directions as to the way in which funds from the sale of certain assets of the estate should be held. Assets specifically gifted by the represented person in her Will had been sold by the administrators who were unaware of the existence of the Will. The Public Trustee was the executor of the Will. In his capacity as overseer of the administrator accounts of the estate, he sought directions from the Tribunal to the effect that the proceeds of the estate be held separately inter vivos so as to allow for the application of an exception to the principle of ademption to apply and so for the gifts under the Will to be preserved and thus the represented person's testamentary wishes not to be defeated by the actions of the administrator during her lifetime.
The administrators did not seek reappointment. The Tribunal appointed the Public Trustee as plenary administrator and made the directions sought by the Public Trustee regarding the separation of the proceeds of sale from the balance of the estate and their quarantining from use in inter vivos expenditure until the balance of the represented person's funds were depleted. The Tribunal found that affordable actions taken to maximise the chances that a represented person's testamentary wishes as reflected in a Will are able to be carried out constitutes acting in their best interests, even if it represents a financial cost to their estate inter vivos, and that it is a matter of balance for the administrator to determine depending upon the circumstances of the person and their estate.
Category: B
Representation:
Counsel:
Represented Person : N/A
Solicitors:
Represented Person : N/A
Case(s) referred to in decision(s):
Public Trustee and BG [2010] WASAT 195
Public Trustee of Queensland v Stibbe & Anor [2012] QSC 357
Public Trustee of Western Australia and W [2012] WASAT 170
Re Hartigan; ex parte The Public Trustee in the State of Western Australia (unreported, Supreme Court of Western Australia, 9 December 1997, Library No. 970736)
Re SB (unreported SAT decision, 17 September 2015)
Re Viertel [1997] 1 Qd R 110
RL v NSW Trustee and Guardian [2012] NSWCA 39
Simpson v Cunning [2011] VSC 466
The Trust Company Ltd v Gibson [2012] QSC 183
Introduction
1 JEB has been the subject of an administration order made under the Guardianship and Administration Act 1990 (WA) (GA Act) since 15 December 2009 (first order) and had previously had assistance from her son, GB, under an enduring power of attorney (EPA) drawn for her by a solicitor in June 2008.
2 The first order appointed her daughter, WH, and GB as joint plenary administrators and revoked the EPA, there being some doubt about the capacity of JEB at the time she executed it. Conflict and distrust had emerged as a result of the discovery by WH of the existence of the EPA, of which she had no prior knowledge, but this resolved and the siblings agreed to act jointly in their mother's best interests.
3 The first order was reviewed by the Tribunal on 14 June 2013. The Public Trustee sought the review, given the apparent breakdown of cooperation between WH and GB and of the joint administration, apparently after the making of a loan out of the funds of JEB by WH to herself, and certain unauthorised gifting. An alternative order was made by the Tribunal pursuant to which the first order was revoked and orders were made appointing WH and LH (WH's husband and soninlaw of JEB) as her joint plenary administrators on the basis of certain undertakings given and subject to certain directions (second order).
4 The matter before the Tribunal is a review of the second order under s 86 of the GA Act.
Capacity
5 There is no issue about the ongoing incapacity of JEB. The Tribunal is satisfied, on the basis of the past medical information lodged with the Tribunal and the current report from the facility manager of the care home in which JEB lives, that JEB is a person who meets the criteria for the making of an administration order. JEB suffers from a progressive dementing illness and will need her finances managed on an ongoing basis.
Need
6 Nor was there any issue that JEB is in need of an administrator. The Tribunal is satisfied that she has an income, and expenses and assets that need to be managed on her behalf on an ongoing basis. She has personal needs which must be met and the funding of these needs to be overseen into the future.
History
7 JEB is a woman in her eighties who has a daughter, WH, and a son, GB. WH and her husband, LH, reside in their home, which is adjacent to the property owned by JEB and in which she lived before going into residential care. She was supported when at home by various family members in their various ways. It appears to the Tribunal that WH and GB got on reasonably well and cooperated together until the time of the second order, at which time an unauthorised loan made out of JEB's estate, by WH to herself, had come to light. This caused something of a falling out and a diminution of trust.
8 JEB had owned her house. At the time of the second hearing, the house had been vacant for some time. It was deteriorating and required work to bring it up to rentable standard, and was almost uninsurable (according to WH). Holding costs were being incurred and the property was not generating any return. Subsequent to the making of the second order, the property was sold by the administrators and the funds invested. It appears from the transcript of that hearing that, although GB had some misgivings about acting contrary to the wishes he says his mother had strongly expressed to him when she was able that the house not be sold during her lifetime, through his counsel, AP, it was essentially conceded that the house should be sold. WH's evidence was that she did not know about the wishes allegedly expressed by JEB regarding the house. She appeared also to be of the view that the sensible and practical course was to sell the house and consolidate the funds in an interest bearing investment. The Public Trustee officer at that hearing also supported the view that something needed to be done to allow the capital that was held in the house to work for JEB's benefit, either through sale, or renovation and then rental, of the property. The determination of the Tribunal, as it appears in the second order, was to direct the administrators to:
sell the property … at market value without delay unless circumstances arise which make such a sale unreasonable and not in the best interests of [JEB].
9 The administrators were also directed to 'regularise' an unauthorised loan made to WH out of the estate funds by taking steps to:
document the loan … and provide a schedule for the repayment of the loan to the Public Trustee within 14 days of this order.
10 WH had given a written assurance in papers provided for the hearing that no further lending would be undertaken.
The review
11 In the context of the s 86 review of the second order, the Public Trustee in his report of 18 June 2015, in his capacity as overseer of the annual accounting by the appointed administrators, raised through his officer, MD, issues about alleged misuse of funds by WH and LH in their capacity as administrators, namely, unauthorised gifting (to GB and WH) and further unauthorised lending (to WH) of funds belonging to JEB.
12 The review was listed for hearing on 22 June 2015 (the review hearing) and the Tribunal made certain directions and listed the matter for further hearing two months thereafter. One of the directions made was as follows:
By 30 July 2015, the Public Trustee will file in the Tribunal and give to all parties a submission relating to [JEB's] Will which was executed in 2007, but only recently located, and the impact of the recent to [sic] sale of [JEB's] home and Westpac shares.
- The direction and adjournment came about because, at the review hearing, the Public Trustee's legal officer, LC, advised the Tribunal that the Public Trustee had become aware of a 2007 Will (Will) executed by JEB and held by the Public Trustee and naming him as executor. The Public Trustee sought leave to make a further submission to the Tribunal regarding aspects of the administration in view of the contents of the Will and the actions, to this point, of the administrators, WH and LH. An adjournment was allowed for this and the Public Trustee clarified by letter to the Tribunal that he sought to do so in his statutory role as overseer of the accounts of the administrators. For the record, it was not alleged that the administrators were aware of the Will prior to its existence being raised by the Public Trustee.
13 Following a number of deferrals and the issuing of some further directions, the matter was ultimately further heard on 15 October 2015.
14 Following the hearing on that day, the decision was reserved, but on the basis that:
1. Pursuant to paragraph (f) of Pt B of Sch 2 of the GA Act, the Public Trustee produce the Will for the Tribunal to inspect.
2. The administrators have leave to provide a summary in writing of the points made by them in opposition to the orders sought by the Public Trustee. (A summary was subsequently provided).
15 Following the reservation of the decision but prior to the delivery of the decision in the matter, the Public Trustee advised that, through an oversight, he had omitted to include in the matters for consideration the sale of a further parcel of shares that had been sold by the administrator and which was also the subject of a specific bequest in the Will. The Public Trustee advised of an amendment of the orders sought by him. These matters were drawn to the attention of the administrators and the other parties. The Public Trustee's explanation as to how that omission came about was accepted and the amendment allowed.
Issues
16 Two main issues require to be determined:
1) Who should be appointed as administrator ongoing and, in particular, whether WH and LH can continue as administrators, in view of the alleged misuse of funds and perceived conflict of interest.
2) Whether the Tribunal ought to make directions regarding the way funds are held by any administrator ongoing, in view of the matters now put into evidence by the Public Trustee about the content of the Will.
17 The Public Trustee seeks orders from the Tribunal under s 72(1) of the GA Act, in particular, pursuant to paragraph (e) of Pt B of Sch 2 of the GA Act, as follows:
Pursuant to s 72(1) and, in particular, pursuant to paragraph (e) of Pt B of Sch 2 of the Guardianship and Administration Act 1990 (WA), it is ordered that:
1. WH and LH as plenary administrators of the estate of JEB (administrators) retain in a separate bank account (first separate bank account) the balance of the net proceeds they still retain from the sale of the property formerly owned by JEB at [address suppressed].
2. The administrators retain in a separate bank account (second separate bank account) the balance of the net proceeds they received from the sale of 2,216 shares in Westpac Banking Corporation formerly owned by JEB.
2A. The administrators retain in a separate bank account (third separate bank account) the balance of the net proceeds they received from the sale of 400 shares in Telstra Corporation Limited formerly owned by JEB.
3. The administrators apply to the first separate bank account and the second separate bank account and the third separate bank account pro rata, any funds received by them during the life of JEB by way of refund of all or any portion of any residential accommodation bond or deposit that has been paid on behalf of JEB.
4. Save to the extent that the funds contained in either the first separate bank account or the second separate bank account or the third separate bank account may be required to meet the ongoing reasonable needs of JEB during her lifetime, the contents of the first separate bank account and the second separate bank account and the third separate bank account be notionally held by the administrators for the future benefit of such party or parties as may be found by order of the Supreme Court of Western Australia to be entitled to the funds in the first separate bank account and/or the second separate bank account and/or the third separate bank account under the last Will of the said JEB, or to such person or persons as may be agreed by all interested parties to be entitled to the funds in the first separate bank account and/or the second separate bank account and/or the third separate bank account.
5. The proceeds of the first separate bank account and the second separate bank account and the third separate bank account shall not be utilised by the administrators to meet the ongoing reasonable needs of JEB during her lifetime unless and until all other monies forming part of the estate have been exhausted.
18 The evidence and submission of the Public Trustee show that following the 2013 hearing, the administrators sold not only JEB's house but also her parcel of shares in Westpac and her parcel of shares in Telstra. GB raised a question as to why it was necessary to sell what were blue chip shares - whether this was proper in the circumstances or whether it was more to do with freeing up funds that could then be used to make loans to WH, as occurred on two occasions in 2014. LH and WH, in their evidence, claim as the reason for the sale their desire to consolidate in order to '[make] it easier to administer for us and easier to provide written annual returns to the [Public Trustee]'.
19 What is clear is that the proceeds of these sales were banked in JEB's account. A consolidation exercise took place with regard to bank accounts to 'streamline' the administration, minimise fees and maximise interest.
20 There is no evidence that either WH, LH or GB was aware of the existence of the Will prior to the information provided by the Public Trustee to the review hearing and in his submission to the Tribunal of 6 August 2013. It appears that JEB had pressed GB in earlier times not to sell her house during her lifetime. WH says that she was unaware of this expressed wish. In her evidence, WH stated further that JEB had dismissed any discussion about wills or her wishes as to her property after her death - that she 'wouldn't talk about it' and 'just wouldn't go there, didn't want to know'.
21 WH appears to have made an assumption that she and GB would be JEB's beneficiaries. In accepting a gift from the estate equal in size to a gift made to WH (to which reference will be made later in these reasons), GB might be thought to have been working on the same assumption. This might not be an unreasonable position to take, in the circumstances of this family.
22 However, the submission from the Public Trustee discloses that, of the assets sold by the administrators, all three were the subject of specific gifts in the Will: the house to GB (or to his wife or children in the event that he predeceased JEB); the Telstra shares to WH; and the Westpac shares to one of JEB's granddaughters, LMLB. The Public Trustee was appointed as executor of the Will.
The Public Trustee's position
23 The Public Trustee submitted that, in view of alleged further misuse of funds by WH and LH in their capacity as administrators namely, unauthorised gifting (to GB and WH) and unauthorised lending (to WH) of funds belonging to JEB - WH and LH were not suitable to continue as administrators.
24 The Public Trustee also sought that the Tribunal make the directions referred to above regarding the holding and use of monies regardless of who was appointed as administrator. In this regard, as it was put to the Tribunal, the Public Trustee, in the knowledge that he may hold the last, or indeed the only, valid Will of JEB, appears to have taken the view that:
1) the question of whether the gifts of the house and the two parcels of shares have been adeemed is likely to arise upon death;
2) there is uncertainty in the state of the law of ademption of gifts in Western Australia;
3) there is authority for the proposition that paragraph (e) of Pt B of Sch 2 of the GA Act may be used to ensure that a represented person's wishes, as contained in their will, are not defeated by dealings with property by an administrator;
4) he has a duty to take what action he can to preserve the proceeds of the three sales in identifiable form in separate 'funds', in order to allow for a proper determination in due course as to whether the 'funds' constitute the devises of the property (in place of the property itself);
5) in the knowledge that he has statutory obligations as overseer of proper accountability and performance by JEB's administrator, it was appropriate that the terms of the Will be examined and steps be taken to seek to have the administrator of the estate of JEB hold the proceeds of the sales in such separate funds during JEB's lifetime, with the ability to draw on monies from the funds if needed for JEB's maintenance, benefit and welfare.
The administrators' position
25 During the course of the hearing, the administrators opposed the orders proposed by the Public Trustee and opposed the revocation of their appointment as administrators. They further made it clear that if the Tribunal determined to make the orders sought by the Public Trustee regarding the holding and use of monies, they did not wish to continue as administrators.
26 In the submission the administrator presented following the reserving of the decision, this position altered to some extent. The submission recites a number of matters, including the 'reservations' that the administrators hold about the Public Trustee's proposals, which largely relate to the increased bank fees and reduced interest income that they believe will result from the proposed manner of dealing with funds, which they also describe as 'cumbersome'. However, having set out those 'reservations', the submission goes on to state:
However … we advise that we do not wish to continue as administrators for the estate of [JEB]. We do have misgivings about the [Public Trustee] being appointed in our place for the reasons advised above, however we consider the [Public Trustee] would be the appropriate person to be appointed.
The law
The principle of ademption
27 If a testator gives a specific piece of real estate to someone else in his or her will and the real estate is sold before death, the gift of the real estate is adeemed. It has no effect. The person who was to have received the real estate under the will gets neither it nor anything else in substitution for it. The same applies to specific gifts of other assets, such as shares.
28 There are certain exceptions to the principle where there is fraudulent or tortious behaviour, or a lack of legal authority.
The GA Act
29 Section 72(1) of the GA Act provides that the Tribunal:
… may give any direction, make any order or do any other thing provided for in Part B of Schedule 2.
30 Paragraph (e) of Pt B of Sch 2 provides that the Tribunal may:
make such orders as it thinks fit for the purpose of preserving the nature, quality, tenure or devolution of any property forming part of the estate and direct that any money be carried to a separate account and declare the notional character which the money in that account bears[.]
31 Paragraph (f) of Pt B of Sch 2 provides that the Tribunal may:
for the purpose of making an order referred to in paragraph (e) of this Part or informing itself for the purposes of section 68(2)(b), [that is, whether there is an unrevoked will held by a trustee company],exercise its powers to require the production of documents by calling for, and inspecting, any testamentary instrument of the represented person[.]
Case law the Public Trustee's position
32 The Public Trustee submits that the case of Re Hartigan; ex parte The Public Trustee in the State of Western Australia(unreported, Supreme Court of Western Australia, 9 December 1997, Library No. 970736) (Re Hartigan), which is a decision of a single judge of the Supreme Court of Western Australia (Court), is authority for the principle that if real estate is sold by an administrator and the testator is not capable of changing his or her will, then the gift of real estate is not automatically adeemed. The devisee is instead entitled, at face value, to the proceeds of sale. Re Hartiganfollowed a case of Re Viertel [1997] 1 Qd R 110 (Re Viertel).
33 InRe Hartigan, the administrator was proposing to sell the relevant house and knew of the terms of the will and sought advice from the Court. Parker J held that knowledge of the will was immaterial; that the 'heart' of the reasoning 'turns on the sale of property by a person other that the testator at a time when the testator is incapable of selling the property or of altering an existing will to give effect to the testator's intentions in the changed circumstances.'
34 In Re Hartigan, the Court ordered that the proceeds of sale be held in a fund (sale fund) separate to the other personal estate of Ms Hartigan and, further, that the sale fund was not to be spent unless, or until, the other funds were exhausted. Parker J took the view that if the proceeds of sale of the house were paid into a separate fund, the sale would not adeem the devise.
35 The Public Trustee submits that there may be serious doubt as to whether the principles in Re Hartigan, which, he submits, constitutes an exception to the principle of ademption, still apply and, if so, how. He referred the Tribunal to the 2011 Victorian case of Simpson v Cunning [2011] VSC 466(Simpson), which is a decision of a single judge of the Supreme Court of Victoria in which the judge expressed some doubts about the state of the law - 'The issue requires urgent legislative intervention to resolve any doubt' at [46] - but then proceeded to follow ReViertel in a situation where the sale was by an attorney under a power of attorney and where 'the remaining proceeds of sale can be identified with sufficient certainty'.
36 In Simpson, Ms Muriel Creswell, in her Will, made a gift of her house to her son Mr Mark Cunning (or to his children if he did not survive her for 30 days). She made some other specific bequests to her children and gave the residue of her estate to her grandchildren in equal shares.
37 Ms Creswell also made a power of attorney (which would appear to have been an EPA). The attorney sold the house at a time when Ms Creswell could not make decisions or give instructions with regard to any of her affairs generally, and was unable to make a new will. The Court found that the decision was made responsibly and in good faith.
38 The question was whether the gift of the house had been adeemed.
39 Section 53 of the Guardianship and Administration Act 1986 (Vic) dealt with ademption of property when there was an administrator appointed under that Act. It said:
Interest of represented person in property not to be altered by sale or other disposition of property
(1) A represented person and her or his heirs, executors, administrators, next of kin, devisees, legatees and assigns have the same interest in any money or other property arising from or received in respect of any sale, mortgage, exchange, partition or other disposition under the powers given to an administrator by an order of the Board which have not been applied under those powers as she, he or they would have had in the property the subject of the sale, mortgage, exchange, partition or disposition if no sale, mortgage, exchange, partition or disposition had been made.
(2) For the purposes of this section money arising from the compulsory acquisition or purchase under any Act of property of a represented person is deemed to be money arising from the sale of that property under the powers given to an administrator by an order of the Board.
(3) An administrator who receives money or other property under this section must keep a separate account and record of the money or other property.
(4) Money received by an administrator under this section may be invested in any manner in which trust funds may be invested under section 4(1) of the Trustee Act 1958.
(5) In this section and section 56'next of kin' in relation to a represented person means any person who would be entitled to the property of the represented person or to any share thereof under any law for the distribution of the property of intestates if the represented person had died intestate.
40 However, there was no similar provision covering when there was an enduring power of attorney.
41 The Court, in Re Simpson, appears to have suggested at [43] [45], that Re Viertel misinterpreted what the common law had been and extended the exception to ademption to beyond what the common law had allowed.
42 However, the Court said at [45]:
… I am nevertheless of the view that a further exception to the ademption principle, to the effect expressed in Re Viertel, constitutes a justified extension of the common law to reflect current circumstances. People are living longer than in the past and their physical health is outlasting their mental capacity. It is commonplace for properties owned by incapacitated persons to be sold under the authority of enduring powers of attorney, to fund accommodation bonds and other necessities and comforts for an aging population. Further, as noted, there is no good reason why the position should be different if, in the absence of an applicable enduring power of attorney, it is necessary to appoint an administrator under the Guardianship and Administration Act to sell property of an incapacitated person for such purposes.
43 The Court then said at [46]:
The issue requires urgent legislative intervention to resolve any doubt. In the meantime, I would follow Re Viertel and recognise a further exception to the ademption principle whenever there is an authorised sale by an attorney in circumstances where:
(1) the deceased lacked testamentary capacity;
(2) the court is satisfied that the deceased, if possessed of testamentary capacity, would have intended the donee of the asset in the will to have the remaining proceeds of sale; and
(3) the remaining proceeds of sale can be identified with sufficient certainty.
44 This test is formulated differently from that in Re Hartigan.
45 The Tribunal was also referred to the NSW Court of Appeal decision on RL v NSW Trustee and Guardian [2012] NSWCA 39 (RL) in which Campbell CJ, after an exhaustive analysis of the law of ademption, disagreed with the approach taken in Re Hartigan.
46 The relevant NSW provision, s 83 of the NSW Trustee and Guardian Act 2009 (which replaced an analogous provision in the Protected Estates Act 1983) provided that:
(1) Any managed person and any beneficiary of a managed person has the same interest in any surplus money or other property arising from any sale, mortgage or disposition of any property or other dealing with property under this Act as the managed person or beneficiary would have had in the property the subject of the sale, mortgage, disposition or dealing, if no sale, mortgage, disposition or dealing had been made.
(2) The surplus money or other property arising as referred to in subsection (1) is taken to be of the same nature as the property sold, mortgaged, disposed of or dealt with.
…
(6) In this section:
'beneficiary' of a managed person means a beneficiary under a will of the person or an executor, administrator or assign of the managed person.
Re Hartigan; ex parte the Public Trustee (WASC, Parker J, 9 December 1997, unreported) is a decision on an ex parte application for advice to the administrator of an incapable person's estate. The likely last will made a specific devise of the incapable person's house. The house was her only asset of significance. Parker J noted that the case before him differed from Re Viertel in that in Hartigan the administrator who was proposing to sell the house knew of the terms of the will. However he held that 'heart of' the reasoning in Re Viertel 'turns on the sale of property by a person other than the testator at a time when the testator is incapable of selling the property or of altering and existing will to give effect to the testator's intentions in the changed circumstances'. He held it was not a material distinction whether or not the person effecting the sale knew of the terms of the will. I agree with that aspect of the decision. Parker J advised the administrator that if the proceeds of sale of the house were paid into a separate fund the sale would not adeem the devise. No mention was made of there being any legislation in Western Australia analogous to s 83 of the 2009 Act. In my view this decision is mistaken, for the same reasons that Re Viertel is mistaken. It is because the sale of the house by a person with authority to do so would have the effect of adeeming the specific devise that legislation like s 83 was enacted.
48 At least one of the other judges in Re RL appeared to agree with Campbell CJ.
49 This case is not binding on the Supreme Court of Western Australia, but is persuasive.
50 Both Campbell CJ in and the Court in Re Simpson appear to acknowledge that part of the reasoning in Re Viertel, was wrong. They also both appear to acknowledge that, as a matter of policy, it would be better to extend the exception to the ademption principle.
51 Where they disagree is in how to do that. In Re Simpson, the Court considered that it could be done by extension of the common law (although there was a recommendation that there be urgent legislative intervention). Campbell CJ, however, at [187], was of the view that only legislation could cure the problem.
52 In at least two cases, the Supreme Court of Queensland has decided not to follow Re Viertel in light of Re RL: see Public Trustee of Queensland v Stibbe & Anor [2012] QSC 357 which cites The Trust Company Ltd v Gibson [2012] QSC 183.
53 Section 60(1) of the Guardianship and Administration Act 2000 (Qld) allows the Supreme Court of Queensland to award compensation 'if a person's benefit in an adult's estate under the adult's will, on intestacy, or by another disposition taking effect on the adult's death, is lost because of a sale or other dealing with the adult's property by an administrator of the adult'. There is no such provision in the GA Act.
The position in Western Australia
54 At the time of Re Hartigan,the GA Act allowed the then Guardianship and Administration Board (Board), the predecessor of the Tribunal in this jurisdiction, to act underPt B of Sch 2 paragraphs (e) and (f). The relevant legislative provisions were the same as they are now. The provisions were not discussed by Parker J. They appear to provide a mechanism where an application could be made to the Board to seek orders that could serve to protect the interests of testamentary beneficiaries, rather than those interests being protected by automatic operation of law (as in New South Wales). The applicant in Re Hartigan, who was the Public Trustee as in this case, did not make application to the Board but instead, sought direction from and the opinion of the Supreme Court of Western Australia (Court) under s 58 of the Public Trustee Act 1941 (WA) (as he was entitled to do).
55 In the submission of the Public Trustee, though Re RL is not binding in Western Australia, it could be persuasive and that therefor Re Hartigan may not be good law. It is to be noted that Parker J himself, in the decision, made the following observation: 'It [is] apparent that there is a measure of uncertainty as to the relevant state of the law'. In view of that uncertainly, the Public Trustee has made submissions on this matter to the Tribunal.
Legislation in Western Australia
56 There is, and has been, legislation on ademption in Western Australia. It was not mentioned in the reasons for decision in Re Hartigan. It is conveniently set out in submission material received previously from the Public Trustee (in a case - Re SB (unreported SAT decision, 17 September 2015) file 864/2009 (Re SB)) - to which reference will be made) as follows:
Section 151 of the Lunacy Act 1903
This said:
(1) The insane or incapable person, his heirs, next of kin, devisees, legatees, executors, administrators, and assigns shall have the same interest in any moneys arising from any sale, mortgage, charge, or other disposition of land ^ under the powers of this Act, which may not have been applied under such powers as he or they would have had in the property the subject of the sale, mortgage, charge, or disposition, if no sale, mortgage, charge, or disposition had been made, and the surplus moneys shall be of the same nature as the property sold, mortgaged, charged, or disposed of.
(2) Moneys received for equality of partition and exchange, and all fines, premiums, and sums of money received upon the grant or renewal of a lease where the property, the subject of the partition, exchange, or lease was real estate of the insane or incapable person shall, subject to the application thereof for any purposes authorised by this Act. be considered as real estate, except in the case of fines, premiums, and sums of money received upon the grant or renewal of leases of which the insane person was tenant for life, in which case the fines, premiums, and sums of money shall be personal estate of the insane person.
(3) In order to give effect to the foregoing provisions of this Act the Court may make such orders and direct such conveyances, deeds, and things to be executed and done as it thinks fit.'
This provision was meant to protect certain gifts under an insane or incapable person's will. If, for instance:
• before becoming incapable, the person left a house specifically to Bob, and
• the house was sold while the person was incapable, then
• after the incapable person's death, Bob would be entitled to the proceeds of sale of the house (unless they had all been spent in the meantime).
Section 151(1) suggests that this would happen whether or not there was a court order. Section 151(3), however, allowed a court order to be made, to give effect to it.
Section 151 remained in the above form throughout the time that the Lunacy Act 1903 was in force. The Lunacy Act 1903 was repealed when the Mental Health Act 1962 came into operation (in 1966).
Section 68 of the Mental Health Act 1962
Section 68(1) listed powers that the Supreme Court could confer on managers under that Act.
Section 68(2) said:
The Court, in making an order under the provisions of this Part, may
(a) direct that any property taken in exchange, and any renewed lease accepted, on behalf of the incapable person shall be subject to the same trusts, charges, encumbrances, dispositions, devises and conditions as the property given in exchange or the surrendered lease was, or would, but for the exchange or surrender, have been subject;
(b) direct that any fine, premium or other payment made on the renewal of a lease be paid out of the estate of the incapable person or be charged with interest on the leasehold property;
(c) where capital moneys are to be raised for the purposes of the administration of the estate, direct the manner in which those moneys are to be raised and how the incidence of those moneys shall be borne;
(d) direct the manner in which any surplus out of capital moneys raised for the purposes of the administration of the estate is to be held or applied;
(e) make such orders as it thinks fit, for the purpose of preserving the nature, quality, tenure or devolution of any property forming part of the estate of the incapable person and direct that any money be carried to a separate account and declare the notional character which the money in that account bears;
(f) where, in its opinion, any sale, lease, mortgage, surrender, release or other disposition, or any purchase, investment, acquisition, retention, expenditure or other transaction is expedient in the management or administration of the estate of the incapable person, or would be in that person's best interest, confer upon the manager the necessary power for the purpose, on such terms and subject to such provisions and conditions (if any) as the Court thinks fit; and
(g) order the costs and expenses of, and relating to, the applications, orders, directions, conveyances, and transfers to be made pursuant to this section to be paid and raised out of, or from the estate of the incapable person or out of, or from the property, rents, income or profits in respect of which they are made, in such manner as the Court thinks fit.
Section 68(3) said:
Notwithstanding, but without limiting, the provisions of subsections (1) and (2) of this section, the Court may make any other order (whether or not of the same nature as those mentioned in those subsections) that it thinks necessary or expedient for administering the affairs of the incapable person.
The wording here was quite different from the Lunacy Act 1903. There was no specific declaration, such as in section 151(1), that a gift in the will would be preserved in an event of a sale. Rather, the Supreme Court was given, it seems, the power to make orders to direct that the property would be subject to the same dispositions and devises, and make orders preserving the devolution of that property. The Public Trustee is not clear whether the court had the discretion as to what the effect of the sale would be. The Parliamentary Debates do not appear to be of any assistance.
Section 68 was not amended in the time it was in force.
The Guardianship and Administration Act 1990 (the GA Act) repealed Part VI (including section 68) of the Mental Health Act 1962.
Part B of Schedule 2 of the Guardianship and Administration Act 1990
When the Guardianship and Administration Act 1990 commenced, section 72(1) said:
'The Board may give any direction, make any order or do any other thing provided for in Part B of Schedule 2.'
'The Board' meant the Guardianship and Administration Board.
Much of section 68(2) of the Mental Health Act 1962 was reproduced in Part B of Schedule 2 of the Guardianship and Administration Act 1990. References to the Supreme Court became references to the Guardianship and Administration Board.
There does not appear to have been any discussion of Part B of Schedule 2 of the Guardianship and Administration Bill 1990 in Hansard. There was no mention in the second reading speeches or subsequent debates or in Committee (in both Houses).
Schedules 1 to 5 were put and passed without discussion.
The only amendments to Part B of Schedule 2 (apart from some format standardising) have been to replace the Guardianship and Administration Board with the State Administrative Tribunal. In 2005, the State Administrative Tribunal came into being and the Guardianship and Administration Board was abolished.
Section 72(1) of the Guardianship and Administration Act 1990 now says:
The State Administrative Tribunal may give any direction, make any order or do any other thing provided for in Part B of Schedule 2.
Part B of Schedule 2 now says:
The State Administrative Tribunal may
(a) direct that any property taken in exchange, and any renewed lease accepted, on behalf of the represented person shall be subject to the same trusts, charges, encumbrances, dispositions, devises and conditions as the property given in exchange or the surrendered lease was, or would, but for the exchange or surrender, have been subject;
(b) direct that any fine, premium or other payment made on the renewal of a lease be paid out of the estate or be charged with interest on the leasehold property;
(c) where capital moneys are to be raised for the purposes of the administration of the estate, direct the manner in which those moneys are to be raised and how the incidence of those moneys shall be borne;
(d) direct the manner in which any surplus out of capital moneys raised for the purposes of the administration of the estate is to be held or applied;
(e) make such orders as it thinks fit for the purpose of preserving the nature, quality, tenure or devolution of any property forming part of the estate and direct that any money be carried to a separate account and declare the notional character which the money in that account bears;
(f) for the purpose of making an order referred to in paragraph (e) of this Part or informing itself for the purposes of section 68(2)(b), exercise its powers to require the production of documents by calling for, and inspecting, any testamentary instrument of the represented person;
(g) where, in its opinion, any disposition or transaction is expedient in the administration of the estate of the represented person, or would be in that person's best interest, confer upon the administrator the necessary power for the purpose on such terms and subject to such conditions (if any) as the State Administrative Tribunal thinks fit;
(h) where a power is vested in a represented person in the character of a trustee or guardian, or the consent of a represented person to the exercise of a power is necessary in a similar character or as a check upon the undue exercise of the power, the State Administrative Tribunal may, upon the application of the administrator or any person interested in the exercise of the power or the giving of the consent, authorise the administrator to exercise the power or give the consent in such manner as the Tribunal may direct.
57 The Public Trustee in his submission also referred to two Tribunal decisions which touch on Pt B of Sch 2. In Public Trustee and BG [2010] WASAT 195 (Re BG), the Tribunal said that orders might be made under paragraph (e) in order to ensure that a represented person's wishes as contained in their will are not defeated by dealings with property by an administrator: see [17] of that decision.
58 That case did not, however, deal with such a situation. It was not necessary for the Tribunal to discuss the point any further in Re BG.
59 In Public Trustee of Western Australia and W [2012] WASAT 170, in discussing paragraph (h), the Tribunal gave it a liberal interpretation, bearing in mind the purpose of the GA Act, and the Act being beneficial legislation: see [29] and [30] of the decision. That is of some relevance when interpreting paragraph (e), although similar sentiments were also expressed in Re BG.
60 Other than in the case of Re SB, no other reported cases have been identified as relevant to these provisions or the provisions of the previous legislation referred to.
61 In his submission, the Public Trustee further submits that, although the wording of paragraph (e) in the Mental Health Act 1962 (WA) (MH Act) and the GA Act are similar, the context in which an application could be made potentially is (or was) different. He submits that in order to sell a property, a manager under the MH Act needed the specific power to do so. If the manager did not have that power, then the manager needed to apply to the Supreme Court to get it. As part of that application, the Court might have made orders under paragraph (e) explaining how the proceeds of sale were to be treated.
62 A plenary administrator, however, does not need specific power to sell real property.
63 A plenary administrator normally does not need to go to the Tribunal for permission to do so.
Findings
64 The Tribunal is satisfied that JEB is a person for whom orders can and should be made.
65 Since the current administrators have indicated that they wish to be relieved of the obligations of administrator, there is no need for formal findings to be made as to any of their past actions. The Tribunal has before it no other formal application for appointment and therefore appoints the Public Trustee as the administrator of last resort. In passing, the Tribunal notes that the apparent antipathy and mistrust between the various family members that has developed in recent years would have made it unlikely that the Tribunal would have appointed any other family member in the role had a formal application for appointment been made. Further, given the comments made during the hearing, it appears to the Tribunal quite likely that the Will will be the subject of challenge in another place after the death of JEB. For that reason, independence in administration, particularly since it is the Tribunal's intention to make the directions sought by the Public Trustee (for the reasons that appear below), any family member appointed as administrator, particularly were it GB or LMLB, may well be placed in a position of conflict of interest when making decisions about the source of funds to be used for the ongoing care of JEB in the event that her income is insufficient to meet her expenses into the future.
Directions
66 In relation to the question of whether the directions should be made, two questions arise:
1) Should the Tribunal make directions of the type sought?
2) Are the directions sought in the best interests of the represented person?
1. Should the Tribunal make directions of the type sought?
67 It is clear that what happens in relation to JEB's estate after her death is governed by the terms of her Will or, in the absence of agreement between her beneficiaries, by orders made by the Supreme Court. The application, if any, of the law of ademption is a matter that falls within that jurisdiction.
68 However, the Tribunal is satisfied that the existence of s 72(1) of the GA Act and Pt B of Sch 2 paragraphs (e) and (f) must be given meaning. Read in the context of the law relating to ademption, as articulated particularly in the cases referred to, it seems to the Tribunal perfectly logical that the section be utilised to permit the making of the directions sought. The Tribunal accepts that what is sought can be accommodated within the scope of the natural meaning of the words of the provisions.
69 It remains unclear why the provisions were not considered in the Re Hartigan case.
70 In Re BG at [17], the Tribunal, albeit obiter, commented that 'orders might be made under para (e) in order to ensure that a represented person's wishes as contained in their Will are not defeated by dealings with property by an administrator'.
71 Directions of this type were made by the Tribunal in the case of Re SB (unreported), SAT decision, 17 September 2015 file 864/2009.
72 SB was the widow of WB and has two sons, R and W. In her 2001 Will, she has left everything to WB if he survived for 30 days. In default, she purported to give a house and land at Lot 55, [address suppressed], said to be 1,200m2 in area, to R, but 'must have 200m² taken off the existing title deed' and given to W.
73 The Will recorded that W 'has already been given his land, being Lot 56, [address suppressed]'. It said that Lot 56 is 800m² in area 'and must therefore have the additional 200m² in area of land taken from Lot 55 [address suppressed], placed on the title deed of Lot 56 [address suppressed] to make equal the portions of land given to them'. The existing shed on the land is also to be given to W.
74 There were default clauses, a clause about vehicles, a possible residue clause and a clause about paying for the expenses of changing the titles.
75 It seems as though there was a subsequent subdivision of SB's property. On 26 September 2008, SB became registered as proprietor of two properties [addresses suppressed] referred to as 200 and 200A.
76 SB executed another Will in 2008 that was professionally drawn. It refers to her late husband. It gives to W the property referred to as 200A [address suppressed] which is a vacant block. It gives to R the property referred to as 200 [address suppressed], which is land with a house on it.
77 The residue goes to W and R 'and if more than one then in equal shares'. There is also a clause dealing with the children of W and/or R, should W and/or R predecease SB.
78 SB subsequently required residential nursing care and, to facilitate payment of her expenses, W, together with his wife, C, who were SB's appointed attorneys under an EPA executed in 2009, executed a contract of sale to sell the property known as 200 [address suppressed], the property that was to go to R under the 2008 Will.
79 After an emergency hearing of the Tribunal, the Public Trustee took over as SB's administrator. Having investigated the circumstances and determined that there was no proper basis to set the sale transaction aside, the Public Trustee allowed the transaction to proceed to settlement.
80 From the net proceeds of sale received (approximately $395,000), the Public Trustee paid the outstanding balance of SB's nursing home accommodation bond ($204,000) and retained the balance of the net proceeds in a separate cash account 'to preserve the interest of [R] in his mother's estate from the sale of the property bequeathed to him'.
81 The Public Trustee subsequently made application to the Tribunal seeking review of the existing administration order 'to give the Tribunal the opportunity to make orders under s 72(1) and paragraph (e) of Pt B of Sch 2 of the GA Act, should the Tribunal see fit to do so'.
82 The Tribunal was satisfied that directions were appropriate and made orders as follows:
Pursuant to Section 72(1) and, in particular, pursuant to paragraph (e) of Part B of Schedule 2 of the [Guardian and Administration Act 1990 (WA)], it is ordered that:
(i) The Public Trustee as Plenary Administrator of the Estate of [SB] (the Administrator) retain in a separate bank account ('the Separate Bank Account') the balance of the net proceeds it still retains from the sale of the property formerly owned by [SB] at 200 Clontarf Road Hamilton Hill Western Australia[.]
(ii) The Administrator apply to the Separate Bank Account any funds received by it during the life of [SB] by way of refund of all or any portion of any accommodation bond which has been paid on behalf of [SB][.]
(iii) Save to the extent that the funds contained in it may be required to meet the ongoing reasonable needs of [SB] during her lifetime, the contents of the Separate Bank Account be notionally held by the Administrator for the future benefit of such party or parties as may be found by order of the Supreme Court of WA to be entitled to the Separate Bank Account under the last Will of the said [SB], or to such person or persons as may be agreed by all interested parties to be entitled to the Separate Bank Account[.]
(iv) The proceeds of the Separate Bank Account not be utilised by the Administrator to meet the ongoing reasonable needs of [SB] during her lifetime unless and until all other monies forming part of the estate have been exhausted.
2. Are the directions sought in the best interests of the represented person?
83 The thrust of the argument made by the administrators during the review hearing in opposing the directions sought by the Public Trustee was that:
• the task of an administrator is to manage the estate of the represented person during her lifetime in a way that is in her financial best interests;
• any proposal for the management of her funds in a way that would or could cost the estate more in fees, would or could result in any diminution of capital, or would or could result in a diminution in interest able to be earned for the estate could not be said to be in her best interests financially, and therefore would amount to a breach by the administrator of his/her duties; and further,
• that the proposal advanced by the Public Trustee was, in fact, a proposal that sought to protect the interests of beneficiaries to the financial detriment of the represented person and thus would amount to a breach of the duties of any administrator.
- These views are also advanced as the reasons why WH and LH were not prepared to continue to act as administrators if made the subject of the directions as sought by the Public Trustee.
84 The Public Trustee's response to this argument is to say that the administrator's first and foremost obligation is to act in the best interests of JEB; that 'best interests' should be interpreted widely, and that to act in the best interests of JEB includes an administrator 'trying to give effect to' her testamentary intentions 'as best as [the administrator is] able to achieve and that in doing that, [the administrator] is … obligated to have regard to her testamentary instruments and to her wishes contained in [them]'; that it is not all about 'a maximisation of the funds'. Put differently, the Public Trustee is saying that to manage JEB's affairs in a way that maximises the chance that the wishes articulated in her Will can be carried out, or can be substantially carried out, is, in fact, to act in her best interests, even though this may have a financial cost to her in her lifetime.
85 The Tribunal accepts that the actions of the Public Trustee are motivated by a perfectly proper desire to do all such things as may be able to be done to support a potential future argument to prevent the ademption of specific gifts made by JEB in her Will. Any suggestion that the Public Trustee is motivated by a desire to benefit a third party is rejected. It is to be noted that, when asked to clarify the capacity in which he sought the directions, the Public Trustee confirmed by letter that he sought to do so in his statutory role as overseer of the administrators. In this capacity, the Public Trustee initially sought that the directions apply to WH and LH as administrators. In the view of the Tribunal, it makes no difference that the Public Trustee is now required by circumstance to fill the role of administrator of last resort. It is noted that the Public Trustee is named as executor of the Will, but that role does not enliven until after the death of JEB. In no sense can the Public Trustee be seen as acting as executor or otherwise on behalf of the beneficiaries at this time. There is not a conflict of interest in the Public Trustee having both roles.
86 The Tribunal accepts the position adopted by the Public Trustee in relation to this issue. Both the optimal management of a represented person's finances during his or her lifetime to allow for the meeting of his or her expenses, and the accumulation of funds in her estate and the management of her financial and legal affairs with a view to attempting to ensure that the wishes articulated in her Will and unchanged during the time of her testamentary capacity are carried out, or substantially carried, if possible, are both legitimate aspects of 'best interests'. It is, in the view of the Tribunal, a question of balance depending upon the particular financial circumstances of the represented person in the individual case. In the view of the Tribunal, the fact that there may be an affordable cost to the estate in setting up matters in a way that increases the likelihood that the represented person's testamentary wishes will be able to be carried out does not, of itself, constitute a failure by the administrator in his duty to act in the best interests of the represented person. In the view of the Tribunal, it is a matter for the administrator to judge in each case. If, in the view of others, that judgment is called into question, then the party questioning the judgment has his or her remedy in bringing the matter to the Tribunal and seeking either that the administrator be replaced or in seeking that the Tribunal direct the administrator in some way. In this instance, the Tribunal accepts what appears to be the Public Trustee's view that any additional expense or loss to the estate that will be occasioned by the setting up of separate accounts is affordable.
87 In this case, the Tribunal accepts that JEB, having made a Will in 2007 appointing the Public Trustee as executor, chose not to tell her children about it. In that Will, she left her house to her son. Why she chose to do so is unclear. It is certainly not consistent with WH's (and possibly GB's) expectations, at least as can be gathered from the way that they both have behaved in relation to the equal gifting, the joint administration and these proceedings up until the Public Trustee submission regarding the Will was made, and from WH's statement that she would challenge the Will after death. JEB appears to have chosen, having made the Will, not to discuss her testamentary arrangements with her family. She appears also to have pressed her son in conversation not to sell the house during her lifetime. The Tribunal has no reason not to accept both of these pieces of evidence. That JEB would have acted in those ways is entirely consistent with the fact that she had acted preferentially to her son over her daughter in leaving the house to him in her undisclosed Will.
88 The Tribunal takes the view that it is proper for all that can be done by an administrator to be done to allow for the testamentary intentions of a represented person to be fulfilled; indeed, in the view of the Tribunal, there is a positive obligation upon an administrator, if he or she is aware or becomes aware of the terms of a Will, to turn his or her mind to this matter when exercising judgment about how to appropriately administer a person's affairs in their best interests during their lifetime. The potential outcome of any possible challenge to the Will is not a matter that should bear on the administrators' thinking during JEB's lifetime. Such matters are far too uncertain in their potential effect to be the subject of the administrator's consideration at this time.
89 The Tribunal is further of the view that if it emerges that the administrator is or could be a beneficiary of the person's estate under the terms of a will, or after any litigation challenging a will, the obligation referred to above may place the administrator in a position where he or she has a conflict of interest that makes it inappropriate for him or her to continue to act as administrator. This case is an example of just such a circumstance.
90 Had the administrators not been prepared to relinquish the role as administrators, they would have been replaced because of the conflict of interest that emerges. In view particularly of WH's statement that it was her intention to challenge the Will and given her apparent focus on what might be her interest under the Will, and on the management of JEB's affairs inter vivos with an eye to the maximising the financial value of the estate, even if this was at the risk of potentially damaging the chances of JEB's testamentary intentions being fulfilled she cannot bring an objective mind to bear in balancing the best interests of JEB when understood in the wider sense referred to earlier. Nor can her coadministrator who is her husband. In the view of the Tribunal, there needs to be an independent administrator.
Priority of funds
91 In relation to the question of the order in which funds ought be utilised during JEB's lifetime, WH and LH raised as an issue the extent to which Direction 5 of the proposed directions sought, may penalise residual beneficiaries over other beneficiaries. In the view of the Tribunal, the approach adopted by the Public Trustee is entirely in keeping with the practice referred to in Re RLwhere Campbell J refers to the longstanding practice of the courts concerning the way in which they administer the estates of incapable persons. At [96], he states 'where there is a choice about which of the assets of an incapable person should be used for the payment of expenses, the practice of the court has been to use assets that are not the subject of a specific legacy or devise before the assets that are the subject of a specific legacy or devise'. In that case, he found that it was within the scope of the New South Wales Trustee's power to issue directions to require the practice to be followed in the circumstances of that case.
92 This is the approach taken by the Public Trustee here and which is reflected in the final direction. It is one which the Tribunal endorses.
93 It may also be suggested that there is a potential for conflict between the potential rights of the three specifically named legatees/devisees under JEB's Will when the administrator is considering which of the three special bank accounts might be drawn on first in meeting required expenses, if recourse to them is required by reason of the exhausting of other funds, or how any particular expense might be split between the three accounts in those circumstances. In the view of the Tribunal, this is a matter for the judgment of the administrator. If, in the view of others, that judgment in respect of such a matter is challenged, then the party questioning the judgment has his or her remedy in bringing the matter to the Tribunal and seeking either that the administrator be replaced, or in seeking that the Tribunal direct the administrator in some way.
Accommodation bond
94 As was clarified during the hearing, no accommodation bond has been paid for JEB; therefore, the matters covered in paragraph 3 of the directions sought is not required.
Conclusion
95 It is the Tribunal's view that the orders set out below are in JEB's best interests.
Orders
1. The orders made on 14 June 2013 are revoked and an administration order in the following terms is substituted for it.
2. The Public Trustee is appointed plenary administrator.
3. Pursuant to s 72(1) and, in particular, pursuant to paragraph (e) of Pt B of Sch 2 of the Guardian and Administration Act 1990 (WA), it is ordered that:
a) The plenary administrator of the estate of JEB (administrator) retain in a separate bank account (first separate bank account) the net proceeds retained from the sale of the property formerly owned by JEB [address suppressed].
b) The administrator retain in a separate bank account (second separate bank account) the net proceeds received from the sale of 2,216 shares in Westpac Banking Corporation formerly owned by JEB.
c) The administrator retain in a separate bank account (third separate bank account) the net proceeds received from the sale of 400 shares in Telstra Corporation Limited formerly owned by JEB.
d) Save to the extent that the funds contained in either the first separate bank account or the second separate bank account or the third separate bank account, may be required to meet the ongoing reasonable needs of JEB during her lifetime, the contents of the first separate bank account and the second separate bank account and the third separate bank account be notionally held by the administrator for the future benefit of such party or parties as may be found by order of the Supreme Court of Western Australia to be entitled to the funds in the first separate bank account and/or the second separate bank account and/or the third separate bank account under the last Will and Testament of the said JEB, or to such person or persons as may be agreed by all interested parties to be entitled to the funds in the first separate bank account and/or the second separate bank account and/or the third separate bank account.
e) The proceeds of the first separate bank account and the second separate bank account and the third separate bank account shall not be utilised by the administrator to meet the ongoing reasonable needs of JEB during her lifetime unless and until all other monies forming part of the estate have been exhausted.
f) The orders will be reviewed by 5 April 2021.
- I certify that this and the preceding [95] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
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MS H LESLIE, MEMBER
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