KD
[2020] WASAT 23
•20 FEBRUARY 2020
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL
ACT: GUARDIANSHIP AND ADMINISTRATION ACT 1990 (WA)
CITATION: KD [2020] WASAT 23
MEMBER: MS F CHILD, MEMBER
HEARD: 2 JULY AND 27 AUGUST 2019
FINAL SUBMISSIONS ON 26 AND 27 NOVEMBER 2019
DELIVERED : 20 FEBRUARY 2020
FILE NO/S: GAA 1285 of 2019
MATTERKD
Represented Person
Catchwords:
Guardianship and administration - Review of administration order - Suitability for appointment as administrator - Order confirmed
Legislation:
Guardianship and Administration Act 1990 (WA), s 4, s 64(1), s 68(3), s 70, s 71(1), s 72(3), s 80, s 80(1), s 84, s 104, s 117
Result:
Order confirmed
Category: B
Representation:
Counsel:
| Represented Person | : | N/A |
Solicitors:
| Represented Person | : | N/A |
Case(s) referred to in decision(s):
Nil
REASONS FOR DECISION OF THE TRIBUNAL:
Introduction
The Tribunal reviewed an administration order made on 14 June 2014 for KD (the represented person) by which his son B is appointed the plenary administrator of KD's estate.
The review of the order was conducted pursuant to s 84 of the Guardianship and Administration Act 1990 (WA) (the GA Act) which requires periodic review of guardianship and administration orders.
The review was conducted in hearings held on 2 July and 27 August 2019 and adjourned for further submissions to be filed and then the review to be determined. Final submissions were received on 26 and 27 November 2019 and the review determined on 29 November 2019 and orders made. It was intended that the reasons for the decision made on review would be delivered orally. However this did not occur. These are the reasons for the decision made on 29 November 2019.
Background
KD is man of 76 years. He has been divorced for many years and has three adult children; sons C and B and a daughter J.
KD suffered a stroke in April 2006 and he experiences impaired cognition and has mobility and communication disabilities as a result. He lives in a high level care facility receiving 24-hour care.
On 5 May 2006, KD executed an enduring power of attorney (EPA) appointing his son B as his sole attorney. The EPA was prepared by a solicitor but did not comply with the formality requirements of s 104 of the GA Act to create an EPA.
Medical evidence submitted to the Tribunal for the original application cast some doubt over the capacity of KD to execute an EPA at the time.
B was appointed the plenary administrator of the represented person's estate on 20 June 2006 following his application to the Tribunal. The EPA was revoked by the Tribunal in the orders made appointing B as administrator.
B's appointment as the plenary administrator of KD's estate was confirmed on review of the orders in 2007, 2009 and 2014.
Review of the administration order
To determine the current review the Tribunal must consider whether KD is a person for whom an administration order may be made and whether he is in need of an administrator of his estate. If he is such a person then the Tribunal must decide who should be appointed as the administrator of his estate and the scope and length of the order to be made.
To appoint an administrator of an estate, or confirm such an order on review, the Tribunal must be satisfied that the person concerned is unable, by reason of a mental disability to make reasonable judgments in respect of matters relating to all or any part of his estate and is in need of an administrator of his estate (s 64(1) of the GA Act).
Principles to be observed
In all proceedings brought under the GA Act the Tribunal must observe the principles set out in s 4 of the GA Act:
(1)In dealing with proceedings commenced under this Act the State Administrative Tribunal shall observe the principles set out in this section.
(2)The primary concern of the State Administrative Tribunal shall be the best interests of any represented person, or of a person in respect of whom an application is made.
(3)Every person shall be presumed to be capable of
(a)looking after his own health and safety;
(b)making reasonable judgments in respect of matters relating to his person;
(c)managing his own affairs; and
(d)making reasonable judgments in respect of matters relating to his estate,
until the contrary is proved to the satisfaction of the State Administrative Tribunal.
(4)A guardianship or administration order shall not be made if the needs of the person in respect of whom an application for such an order is made could, in the opinion of the State Administrative Tribunal, be met by other means less restrictive of the person's freedom of decision and action.
(5)A plenary guardian shall not be appointed under section 43(1) or (2a) if the appointment of a limited guardian under that section would be sufficient, in the opinion of the State Administrative Tribunal, to meet the needs of the person in respect of whom the application is made.
(6)An order appointing a limited guardian or an administrator for a person shall be in terms that, in the opinion of the State Administrative Tribunal, impose the least restrictions possible in the circumstances on the person's freedom of decision and action.
(7)In considering any matter relating to a represented person or a person in respect of whom an application is made the State Administrative Tribunal shall, as far as possible, seek to ascertain the views and wishes of the person concerned as expressed, in whatever manner, at the time, or as gathered from the person's previous actions.
Evidence and material before the Tribunal for the review
The Tribunal heard from KD, his sons and daughter and a social worker during the hearings. KD attended the hearing by telephone from the care facility and was accompanied by the social worker. C attended by telephone from overseas.
The following material was filed for the review:
•A report dated 3 May 2019 from Ms B, a social worker from the care facility where KD has lived since 2008. The report states that the primary contacts for KD are his daughter J and his son, B. It is reported that he has no contact with C. KD's medical conditions are described as ''CVA [Cerebrovascular accident] 2006, epilepsy and expressive dysphasia'.
•Further submissions were later filed from another social worker from the same care facility, Ms W. Those submissions were filed on 27, 28 August and 26 November 2019. The earlier submissions refer to arrears of the care facility fees and the later submission reports that the arrears have been cleared.
•A report of the Private Administrator's Support Team of the Public Trustee (Public Trustee) dated 1 May 2019 reporting on the examination of accounts No 12 and No 13 filed by B in compliance with s 80(1) of the GA Act. Timeliness for the lodgement of account No 12 is reported as poor but otherwise there are no deficiencies or concerns identified in the administration of the estate.
•In the copy of the accounts filed by B with the Public Trustee, KD's income is reported as an annuity and some bank interest. His assets include bank accounts, shareholdings and other investments, a loan to J, a debt owed by C, a residential aged care 'bond' and an interest in a property in a country town which is owned jointly with C (the property).
•Further correspondence filed 2 July 2019 from the Public Trustee provides B's response to queries regarding the management of the estate. The background to the loan of KD's funds to J is explained as advanced for the purchase of materials to build a purpose built granny flat on J's home where it was intended that KD live. According to B's letter, KD suffered a fall which caused him to break his hip with a further loss of mobility. Following this KD required a higher level of care and was admitted to the care facility where he now lives.
•J filed a submission dated 28 August 2019 stating that KD is unable to manage his own affairs and that she supports B's reappointment as administrator consistent with the KD's wishes.
C's submissions and evidence
•Submissions from C dated 2 July and 26 August 2019 set out a time line of events relating to the property he owns jointly with KD.
In his submissions C says:
•He had been the tenant of the property in 1994 and convinced KD to purchase it for $75,000. A bank loan was taken for $72,000.
•The property is in the joint names of C and KD. C lived there and made improvements to the property between 1994 and 1996. C says that KD 'stubbornly refused' to build on the property or to live there. The property has been described as close to the town's racetrack and used to agist horses during the racing season.
•C moved to Melbourne in 1996 and the property was then yielding rental income of between $500 and $800 (it is assumed per year) from agisters which helped service the mortgage.
•When he moved overseas C made special loan payments telegraphed from Singapore. By March 2001 special payments in the amount of $28,118 had been made and the loan balance was $19,947. The loan was paid out between 2 January 2002 and 17 March 2002. C paid the loan out eight years ahead of schedule with savings of interest. KD would have kept records of these payments and C believes the administrator, B, has these documents. C had to retire from his trade for health reasons. (There is no reference in C's submissions to any contribution by KD to the purchase of the property).
•Following KD's stroke, C had a conversation with B in which B identified the property as part of KD's assets. C 'did not bother to mention' to B his own interest in the property as it had been 'a matter between [KD and himself] and nobody else's business'.
•In 2006, B proposed that the property be sold. B then asked him to prove his joint ownership of the property.
•In late 2007 C received a summons for non-payment of rates for the property. Thereafter he warned B off any involvement with the management of the property and evicted the agisters.
•C paid about $25,000 in Shire Council and Water Corporation rates and to firebreak contractors in the last 13 years. The property has been unoccupied since 2016 and has had no maintenance since C left in 1996. C asserts the property has been effectively frozen for 13 years. He was unable to confirm whether public liability insurance is held.
•In his submission for the review C includes a copy of an email from him dated 7 January 2008 to a third party stating:
… I have become increasingly disturbed by [B's] performance and motives as administrator of [KD's] financial affairs, this is compounded by his refusal to provide information establishing how he is managing [KD's] finances.
I intend to borrow money from an Australian bank for investment, as the property to be used as security for the loan has both mine and [KD's] name are on the title it is necessary to have [KD] sign the security guarantee as well[.]
(Document 10, C's submission, 2 July 2019)
C said in the hearing that this proposal was not taken any further; ts 10, 27 August 2019.
•KD has not indicated to him that he has any recollection of the property. The last time C saw KD at the care facility, KD 'took an uncomfortably long time to decide who I was'.
•C also filed material which he had copied from internet posts from shareholders in a resource company which had had a significant fall in its share price while B was the managing director. Initially C said this material supported his assertions that B was unsuitable for appointment as administrator but in the hearing he said these matters were irrelevant to the proceeding before the Tribunal; ts 12, 27 August 2019.
•C also made allegations that B was unfit to be the administrator and was 'dishonest and deceitful'. The example he gives of alleged dishonesty on the part of B was in the execution of the EPA in 2006 which C says was inappropriately obtained by B. When asked to provide any other evidence to support his allegations he said, 'I can't think of anything at the moment'; ts 34, 27 August 2019.
•C does not want the jointly owned property sold and had not heard KD say that the property should be sold; ts 8, 27 August 2019.
In the review hearing C proposed himself for appointment as administrator of KD's estate in respect of the interest in the property held jointly with C. Later, he said that he would not propose an alternative administrator to B until B 'washed his hands' of anything to do with C's involvement in the jointly owned property; ts 8, 27 August 2019.
In his submission C says:
…
I wouldn't be otherwise interested in [KD's] estate but as we are partners in property and I fear if [KD's] current administrator acts with the same delusional incompetence and poor judgment as he did in respect of his managing directorship of [the resource company] then I fear my own estate will also be in danger[.]
(Document 10, C's submission, 2 July 2019)
When asked about what should happen about KD's affairs C responded that he had
… no idea … I have no clue … it wouldn't really interest me other than, obviously, what I've described before. If there is a problem with KD's financial affairs, in turn, there will probably be a problem with mine, so that's my only interest in this.
(ts 10, 27 August 2019)
B's evidence
B said in the hearing that he could understand C's frustration about the jointly owned property being tied up in KD's estate but said he did not consider it appropriate as administrator to be guaranteeing loans for C using the property as security.
B asserts that C was initially comfortable with the way B was managing the property but that C had then taken over and since then, B had not received any accounts or income or expenses for the property in the last 10 years. He said he was not sure about KD's attitude towards the property being sold.
B said he had resigned as managing director of the resource company and now works as a consultant. B confirmed he was not bankrupt and submits that there is no reason that he should not be reappointed as the administrator of the estate. B says the allegations made by C are incorrect and completely unsubstantiated. He says he has a violence restraining order (VRO) granted to him in respect of C because B says there have been death threats and threats of violence from C and he can only communicate with C through solicitors.
A submission from B dated 27 November 2019 confirms that care facility fees for KD's accommodation reported by the social worker to be in arrears have been brought up to date.
Is KD a person for whom an administrator may be appointed
There was no challenge to the previous finding of the Tribunal that KD is a person for whom orders may be made and that he is in need of an administrator of his estate.
No new medical evidence was sought by the Tribunal for the purposes of the review. The Tribunal is satisfied on the evidence submitted to the Tribunal in the original application and at subsequent reviews that the presumption of capacity of KD to make reasonable judgments about his estate is rebutted.
The Tribunal finds that KD has an acquired brain injury and he is by reason of this disability incapable of making reasonable judgments about his estate. He is a person for whom an administration order may be made.
Is KD in need of administrator of his estate
The documents filed by the administrator with the Public Trustee show that the represented person has an estate to be managed.
All the parties agree and the Tribunal finds that KD needs an administrator to manage his estate on his behalf.
Who should be appointed the administrator of KD's estate
The issue raised in the review is who should be appointed as the administrator of KD's estate. C made written submissions referred to above and oral allegations about the conduct of the administration of the estate by B. In the course of the proceeding C proposed himself for appointment of part of KD's estate, being KD's interest in the jointly owned property.
There is no material before the Tribunal other than copies of abusive internet posts and C's stated beliefs to explain the reported fall in the share price of the resource company of which B had been the managing director. C did not provide any other evidence to support his allegation that B is not competent to manage the estate of KD and confirmed in the hearing that he does not know anything about the estate or its management.
C could give no additional evidence to support his serious allegations of dishonesty made against B other than allegations previously made about B's purported misconduct in respect of the execution of the EPA and the alleged refusal by B to provide financial information about the management of the estate to C (which is denied by B).
In relation to the execution of the EPA, the Tribunal accepts B's evidence that he relied on legal advice about the execution of the EPA since the 2006 EPA, despite its defects in form was prepared by a solicitor.
The allegations made by C appear to arise out of a longstanding conflict between the sons of KD and C's anger and frustration that he is not able to deal with his interest in the property jointly owned with KD including using it as security to obtain a loan. C holds B responsible for this.
C's proposal that he be appointed limited administrator of that part of the estate of KD relating to KD's interests in the jointly owned property is not appropriate or in the Tribunal's view, in the best interests of KD.
On rare occasions the Tribunal may appoint administrators of different assets or income streams of an estate if this is in the best interests of the represented person. The most common occurrence of this is where the Public Trustee is appointed limited administrator to examine the interest of the represented person in a deceased estate where the family member appointed as administrator may also have an interest in that deceased estate. The family member may continue to be appointed to manage the other parts of the estate, for example the pension income of the represented person.
This is not the case here. In fact, C has indicated quite explicitly in his written submissions and in his statements in the hearing that his reasons for seeking his appointment as administrator of KD's estate (as it relates to KD's interest in the property) is to protect his own interests.
It is the case that although C and KD are joint owners of the property, their interests in respect of that property may not always coincide. This can be easily seen when considering whether the property could or should be used as security to negotiate a loan or the timing of its sale.
Even if C did not have this conflict, this is not a case where it would be appropriate to appoint separate administrators for different aspects of KD's estate because other than the conflict with C over the property, KD's estate is a relatively simple one. In addition, it is understood that C lives overseas.
The management of KD's estate is complicated by the continuing conflict with C, the difficulty in communication between B and C which arises because of the nature of C's communications and the VRO and that all communication must be through solicitors with additional costs incurred.
C says he did not understand what a joint tenancy meant at the time when B first proposed the sale of the property (and C acknowledges that he had not told B that he too was an owner of the property). C asserts that B must have the documents which C says show that C made special payments to pay the mortgage and that C believes that KD is not now aware of his ownership of the property.
As C must now be aware neither of these matters bear on the ownership of the property which remains jointly owned by KD and C. That KD may not fully appreciate his estate (if this is correct) could only reinforce why he has an administrator of his estate appointed to manage his estate and protect his interests.
B, as the plenary administrator of KD's estate, is not entitled as C suggests to 'wash his hands' of involvement in the management of the property. As a joint owner KD is jointly liable for the liabilities and jointly entitled to the income or the proceeds of sale of the estate as is C as the other joint owner.
As the administrator B must act in the best interests of KD (s 70 of the GA Act) and as he has plenary authority, B may perform or refrain from performing, in relation to the estate of the represented person, or any part of the estate, any function that the represented person could himself perform, or a refrain from performing, if he had full legal capacity. (s 71(2 ) of the GA Act). This means that B effectively stands in the shoes of KD when dealing with his estate, including the property owned jointly with C and could sell KD's interest (if C, as the other joint owner agreed) but he is not entitled to give away KD's estate so could not simply transfer KD's interest to C on less than commercial terms without authority of the Tribunal (s 72(3) of the GA Act).
If both C and B (on behalf of KD ) could agree to the sale of the property this would be the simplest way of severing the involvement and would realise each owner's interest in the property which is, according to C, deteriorating and has been 'frozen' for years. This process would require some cooperation and communication between C and B.
In respect of the performance of the administrator which is a consideration when determining who should be appointed on review, the arrears of KD's care facility fees, quite properly raised by the social worker during the review, are of concern but it is noted that once brought to the attention of the administrator, the fees were brought up to date and the Tribunal accepts there are systems in place to prevent a reoccurrence.
It is the role of the Public Trustee to require accounts to be filed by an administrator and examine those accounts pursuant to s 80 of the GA Act. The Public Trustee does from time to time seek a review of orders if it is not satisfied with the performance of any administrator. This has not occurred in this case and it appears that the 12 sets of accounts filed by B have been examined and allowed by The Public Trustee.
In determining the suitability of any administrator for appointment the Tribunal must consider the factors in s 68(3) of the GA Act which provides:
For the purposes of subsection (1), the State Administrative Tribunal shall take into account as far as is possible
(a)the compatibility of the proposed appointee with the person in respect of whom the application is made and with the guardian (if any) of that person;
(b)the wishes of that person; and
(c)whether the proposed appointee will be able to perform the functions proposed to be vested in the administrator.
Based on the material before it, in particular, from the social workers at the care facility, the Tribunal is satisfied that B is compatible both KD and with J (who acts as a personal decisionmaker for KD) which is relevant to the consideration in s 68(3)(a) of the GA Act.
The wishes of KD are also to be considered in the assessment of the suitability of the administrator pursuant to s 68(3)(b) of the GA Act and are considered below.
In respect of s 68(3)(c) of the GA Act the Tribunal is satisfied that B is able to perform the functions in the management of KD's estate as he has the necessary skills and experience.
If B considers at any stage that he is not able to perform the functions required of the administrator in respect of the management of KD's estate as it relates to the jointly owned property, then, he may at that time seek review of the order and may propose that the Public Trustee be appointed as administrator.
Such a consideration may occur if B considers that KD should sell his interest in the jointly owned property because he determines that retaining the property is of no benefit to KD and presents some risk to his estate.
When appointed as administrator the Public Trustee is entitled to charge fees including in relation to the sale of any property (in addition to the normal costs associated with sale of a property). Those fees are met by the estate. At the present time the administrator does not charge for the administration of the estate and is in fact not able to be remunerated because the estate is not large or complex (s 117 of the GA Act).
Wishes of the represented person
When asked in the hearing for his views, KD responded that B had been managing his estate for about 12 years. The social worker reported that she believed KD to being saying that it was 'all good'. She said she had asked KD prior to the hearing and reported that he had said he was happy about how his affairs were being managed and by whom; ts 35, 28 August 2019.
As noted, J supports B's appointment as administrator of KD's estate and states that B's appointment is consistent with KD's wishes.
Conclusion
Although KD has a relatively simple estate he is not able to make judgments about it himself and needs an administrator of his estate. It is accepted that B was and is KD's choice to manage his estate. B has the requisite skills and knowledge to manage the estate. A complicating factor in the management of the estate is the animosity shown by C to B which the Tribunal infers predates B's appointment as administrator.
C has made serious but unsubstantiated allegations about B which have not been accepted by the Tribunal. The Tribunal finds B suitable for reappointment. C is not suitable for appointment as an administrator of KD's estate for the reasons given.
The appointment of B as administrator of the estate is consistent with KD's choice and is a less restrictive option to the appointment of the Public Trustee.
Given the range of income and assets in the estate it is appropriate that the administrator have plenary functions.
KD's incapacity to manage his estate is longstanding and for this reason the order should be made for the longest period possible.
Orders
The Tribunal declares that the represented person, KD is:
(a)unable, by reason of a mental disability, to make reasonable judgments in respect of matters relating to all of his estate; and
(b)in need of an administrator of his estate.
The Tribunal orders:
Administration
The administration order dated 14 June 2014 is confirmed as follows:
1.B is appointed plenary administrator of the represented person's estate with all the powers and duties conferred by the Guardianship and Administration Act 1990 (WA).
2.The administration order is to be reviewed by 21 November 2024.
I certify that the preceding paragraph(s) comprise the reasons for decision of the State Administrative Tribunal.
MS F CHILD, MEMBER
20 FEBRUARY 2020
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