KJN

Case •

[2024] QCAT 53

•

10 January 2024

QUEENSLAND CIVIL AND
ADMINISTRATIVE TRIBUNAL


CITATION:

KJN [2024] QCAT 53

PARTIES:

In an application about matters concerning KJN

APPLICATION NO/S:

GAA8167-19
GAA1915-21
GAA1938-21

MATTER TYPE:

Guardianship and administration matters for adults

DELIVERED ON:

10 January 2024

HEARING DATE:

14 September 2021, 15 September 2021, 19 November 2021 and 27 April 2022

HEARD AT:

Caloundra and Brisbane

DECISION OF:

Member Allen

ORDERS:

1.     KJN had capacity to make an enduring power of attorney on 12 January 2021.

2.     The application for the appointment of an administrator is dismissed.

3.     The application for an order about an enduring power of attorney is dismissed.

CATCHWORDS:

HEALTH LAW – GUARDIANSHIP, MANAGEMENT AND ADMINISTRATION OF PROPERTY OF PERSONS WITH IMPAIRED CAPACITY – GUARDIANSHIP AND SIMILAR APPOINTMENTS – where the adult has extensive business assets – conflicts between sons – adult has medical event resulting in delirium – conflicting evidence about capacity of adult – adult appoints attorneys during course of proceedings – whether adult has capacity to make financial decisions having regard to his business interests – whether the adult has capacity to make an enduring power of attorney

Guardianship and Administration Act2000 (Qld), s 5, s 11, s 12,
Powers of Attorney Act1998 (Qld), s 41, s 113

Human Rights Act2019 (Qld), s 13

APPEARANCES & REPRESENTATION:

This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld)

Adult:

Mr Crofton M of Counsel instructed by McColm Matsinger Lawyers

Applicant/s:

Mr Hastie J of Counsel instructed by O’Connor, Ruddy & Garrett Solicitors

Proposed Administrator/s:

Mr Ulyatt, S partner Greenhalgh Pickard

Current Attorney/s:

Ms Pendergast of Counsel instructed by Ascendia Lawyers

REASONS FOR DECISION

Introduction

  1. KJN is 90 years old and is a very successful businessperson with interests in a Real Estate agency, service stations, commercial property and residential rentals, farming, and land development.  He holds these interests personally and through a partnership, companies, and trusts. It was estimated that his assets both owned by him and under his control are valued at nearly 17 million dollars, although he believes that the land is due for revaluation which may increase the value of his assets. He has three sons, KJS, KPL, and KJT who assist him in various businesses with each son being involved mainly in only one aspect of the business. KJS is involved in the farming, land development, and residential rentals. He has assisted with the services stations. KJT is involved in the service stations and has assisted in land development. KPL is involved in the real estate agency and gives general support to KJN in the administration of the businesses. KJS and KJT stated in their material they believed that KPL overstates his role in the business. KJS’s wife KS is the HR manager for the service stations. KPL’s wife KJ works in general business administration assisting KJN. It is fair to say that KJS and KJT have issues with KJ having access to the business bank accounts and the accounting system. KJN supports her in the role. KJN was still running all the businesses at the time of the original application in July 2019. KJN stated that he had contemplated retirement and there are three main reasons why he had not retired. First, he enjoys work. Second, he is not confident any one of his sons are individually capable of running the entirety of the businesses as a whole. Thirdly, he is the personal guarantor of the bank for the business accounts and loans and none of the sons have volunteered to act as guarantor and while he is personally liable he does not propose to step down.

  2. KJN had a fall at home which resulted in a fractured neck of femur in April 2019. He underwent a hip replacement and there was concern that he may have lost capacity, in particular as a result of comments that KJN made to KJS during his hospital stay, about the actions of the nursing staff and the observed interactions of KJN with nurses and others within the hospital system. There appeared to be a level of agitation and paranoia at the time. KJT also observed KJN to be displaying signs of confusion and paranoia at the time. KJN acknowledges this and notes that he was in pain due to such things as the support socks he was required to wear being too tight and the fact that he was on significant pain medication. He also did not have two working hearing aids and struggled to hear what was being said. KJN was referred to Dr I, a psychiatrist by the rehabilitation team, having regard to his behaviour during his rehabilitation. An assessment was performed by Dr I which opined that KJN had dementia and short-term memory loss and was incapable of making business or personal decisions. He did not cooperate with any cognitive testing with Dr I. It was noted that a MOCA that had been administered by the OT gave a score of 23/30. A score of 27 was considered to be normal and a score of 23, as is his case, indicates a significant cognitive impairment (mild cognitive impairment). KJN stated that he struggled to understand to understand and communicate with nurses and doctors that spoke rapidly or otherwise had strong accents like Dr I. A further report was provided by Dr BH, who had been KJN’s GP; copies of both reports were filed in the Tribunal. These reports were prepared in late May 2019.

  3. KJS sought the advice of the family lawyer, Mr B, and was told that he needed to make an application to the Tribunal for the appointment of an administrator. Mr B arranged for a capacity report to provided by Dr I. KJS was referred to other lawyers for that purpose as Mr B was KJN’s lawyer. This is confirmed in an affidavit by Mr B. An application was then made to the Tribunal for the appointment of administrators. The applicant was KJS who at the time thought that KJN’s capacity was affected by dementia according to the current specialist medical opinion and that there was a high likelihood that erroneous decisions were being made. KJS noted that there was conflict between decision makers. He nominated himself and KJT as well as GMA, an accountant jointly as administrators for KJN. KJT filed material in support of the application confirming the material of KJS. Later in the matter GMA was no longer available and KRB, KJS’ daughter who was an accountant was put forward as another administrator. Ultimately, it was submitted on behalf of KJS that if an administrator needed to be appointed it should be either the Public Trustee of Queensland or an independent trustee.

  4. At the time of the original application there was an enduring power of attorney (EPA) executed by KJN on 7 March 2007 in place which appointed KJN’s three sons jointly as his attorneys for personal/health and financial matters, with the powers in regard to financial matters to begin immediately. It was noted in the material accompanying the application that due to incompatibility between the attorneys they would be unable to agree on any decision to ensure KJN’s interests are adequately protected.

  5. There were allegations made in the material accompanying the application for administration in regard to the conduct of KPL over the years, in particular that he had bullied both family and staff members and had controlled the accounting information in regard to the businesses to the exclusion of his brothers. This was refuted by KPL who noted that a domestic violence order had been in place against KJS in regard to his behaviour at the business premises. KJN’s view was that none of the sons were blameless but they all performed their roles and it did not affect the business adversely. KJN had a mild heart attack in early June 2019 and a stent was inserted.

  6. Subsequent applications were made for a declaration about capacity and an order about an enduring power of attorney. The later applications related to a new EPA executed by KJN on 12 January 2021 which appointed KPL and his wife KJ jointly as KJN’s attorneys for personal/health and financial matters. KJN stated that his previous firm of lawyers had given him advice about a new EPA and they advised the attorney should be independent of family, and a member of the family was prepared to take on the role. It was unsettling for him as he had only known the firm for a short time, and they knew nothing of significance about him. It was later agreed that the appointment would be of a member of the firm with KPL and KJ. He found out through the Justices Association that there were new EPA forms coming and decided to postpone the making of the EPA until he had familiarised himself with the new form. It was some time after that that he ceased to be represented by that firm. Ultimately KJN drafted his own handwritten EPA with terms and conditions. KJN decided the handwritten EPA was scrappy and had it typed in the office by KJ. He then took it to an independent JP to be witnessed.

  7. There was concern raised around the time of the original application in regard to the need for certain contracts to be executed for the service stations and that the businesses were being put at risk by KJN’s inability to do so and an application for an interim order was made. Ultimately, following the initial assessment by Dr SH, KJN was comfortable in finalising these business matters. KJN considered that KJT’s continuing to ask him to sign documents was quite telling acceptance of KJN being able to complete these business dealings, and showed that he considered KJN had capacity. KJT denied this in his material. The application for an interim order was dismissed.

  8. KJN acknowledged in response to the application that his recent health difficulties and behaviour while in hospital had given cause for his family to be concerned in regard to his capacity but that he considered he retained capacity. KJN noted that following the cardiac surgery he was able to return to work but considered that he should not execute any contracts until he was cleared by a geriatrician. He indicated that he was willing to undergo assessment by a geriatrician to determine whether the application was necessary or not. KJN underwent an initial capacity assessment by Dr SH, geriatrician, in August 2019, which showed that he had a good understanding of the current business arrangements and the matters to be attended to and he was able to comprehend complex abstract concepts and apply them to his situation. Following the assessment by Dr SH, KJN executed the major agreement in relation to the petrol station and was taking advice in regard to the second contract. Dr SH later provided an interim report in September 2019 and opinion at the time was that KJN had not returned to full independent decision-making though she did not determine he had lost capacity. She noted that he had not been able to deal with the documents to be signed as he had not been able to cognitively resolve his concerns. Her opinion was that he had a significant understanding of his financial and business arrangements. Dr SH was of the view that it is appropriate for others to temporarily assist KJN with business related financial matters and that KJN remained involved in the decision-making process. Dr SH considered that KJN understood the components of an EPA and he was seeking further advice in regard to the making of a new EPA. This did not occur as the interim order was refused and KJN was able to sign the documents in regard to the service stations as mentioned.

  9. KJN’s view was that he had access to and received advice from solicitors and accountants on business and financial matters and that he was already receiving the assistance needed. Dr SH was also of the view that KJN understood the components of an EPA. KJN had also passed a driving assessment and with a medical certificate from Dr SH was able to return to driving though his speed was limited to 80 km per hour and a limitation of roads he could use. KJN’s view was that the application for administration should be dismissed based on Dr SH’s opinion and the arrangements he had in place. KJN was concerned that none of his sons alone had the requisite skills and knowledge to run all the businesses. KJN was also concerned that KJS and KJT would not fully consider KJN’s views in regard to KPL’s role in the business. KJN noted the comments made by KJS and KJT in regard to KPL and considered that none of them were blameless. KJN was also concerned that KJS and KJT as a result of their issues with KPL would be at risk of allowing personal family matters to adversely impact on the business. KJN’s initial view was that if an administrator needed to be appointed it should be his accountant KG. This was on the basis that KG was independent of KJN’s sons and familiar with all of KJN’s business and property interests. It was ultimately submitted on behalf of KJN that if an administrator was to be appointed it should be a private trustee.

  10. KPL also opposed the application and was of the view that KJN currently had capacity and that the arrangement under the 2007 EPA were workable with correspondence being forwarded to his solicitors. KPL also noted that the report of Dr SH should be preferred over that of the reports of Dr I and Dr H as it was written based on 4 reviews during August and September 2019 and the other reports were conducted many months before. KJS noted that Dr SH’s opinion was that KJN is not able to return to full independent decision-making with impaired cognition caused by delirium and early cognitive impairment wanted to proceed with the application with an independent administrator such as MGA to be appointed pending the hearing of the application. This view was shared by KJT. The Tribunal ultimately dismissed the application for an interim order. 

  11. Due to Dr SH’s health issues she was not able to provide a final assessment for KJN or be available for a hearing to be held in December 2019. During the period to July 2020 KJN’s wife RN had health issues and eventually passed away, and KJN had further health issues and needed to have a pacemaker inserted. KJS filed material settings out concerns he had in regard to his father’s capacity during these periods. There was also a request that KJN’s capacity be re-assessed by a Brisbane based geriatrician. KPL filed material which cast KJS as the person who caused disputes between the brothers and was in support of KJN’s capacity and explained the issues which had faced him over the period. KPL did not consider that KJS and KJT had the skills necessary to perform the role of administrator and noted that he provided assistance to KJN as portfolio and administration manager in the businesses. KPL suggested that if further capacity assessments need to be performed, they could be performed by local geriatricians, namely Dr VH or Dr DH.

  12. KJ, the wife of LPK filed material in September 2020 in support of KJN. She had known him since 2006 and had been employed in the business since 2015 in an assistant role to him. She noted that he had returned to work and was having high level meetings with banks and that he was actively running his various businesses. She said that KJN will seek out and take advice from his accountant and solicitor when needed and will consider such further information in making well founded and successful decisions in his businesses.  She also spoke of the assistance that she offered KJN on a personal level in regard to his needs at home and commented that his grief after his wide passed away was normal and she did not witness any of the actions spoken of by others.

  13. KJS later responded to the material in regard to meetings with banks, that KJN has been dealing with bank managers for his whole working career. He is a very private and careful person, in KJS’ experience, he would sometimes seek input from KJT, himself or JPL about matters. However, he always made his own decisions. That none of KJN’s bookkeepers in the past attended meetings with KJN and his bank managers. If KJ’s evidence is indicative of KJN’s current practice which KJS does not concede, it is concerning and raises issues about his level of comprehension. From KJS’ observations of KJN and in view of the medical evidence KJ’s comments regarding KJN’s ability to continue to work and his ability to make business and financial decisions is untrue. KJS contended that in early 2018 KJN stated he no longer understood the details of the financial accounts when he provided KJS and KJT copies of those ended 30 June 2017. KJN later recalled the incident that the aspect he had difficulty appreciating was the movement of profits across the various entities and he had clarified it with the accountant, and then understood it to be tax related.

  14. KJN described himself as a cautious, guarded, and private person in his personal and business affairs. When it has come to financial or business matters, he has learnt through many courses of study that he is very careful and cautious and typically risk-adverse; further, he has never been one to do things or make decisions for the sake of pleasing others in any way. He typically takes his time when responding to something of importance so as to make a considered response, and has long prided himself on trying to be as honest as possible and act with much integrity as possible. He later stated that it is his view that as long as he has capacity it is for him to take whatever risks he chooses to and for that matter make whatever decisions he chooses regardless of anyone else’s views. However, he does not consider that he has or will make decisions that he cannot live with, mentioning the characteristics set out above. Further, he acknowledges, he accepts and makes no excuses for the fact that he may be or always has been more conservative or less adventurous than others. He does not think it is incumbent on him to make the absolute most of what he has which ordinarily requires higher risk than he is prepared to accept; it has always been his preference to act conservatively, and his financial circumstances and needs have not required him to take investment risks that could not be easily borne. 

  15. KJN noted in regard to his businesses after setting out the components of them that the varied nature of the enterprise allows him the freedom to continue with an aspect of the enterprise through difficult periods. For example, currently the real estate agency is not as active as it normally is but is still able to be continued as part of the overall enterprise. He is confident that the real estate agency will move into an improved cycle in due course. KJN later noted that KJS and KJT make reference to the success or importance of one aspect of the business over another but seem to not recognise what he has learnt over the years: that good times in one or another aspect of the enterprise do not last forever, the bad times in one or other aspect of the enterprise do not last forever, that substantial things can change, that the enterprise cannot be considered to rely, for its long term existence or identity, on one aspect. He notes that changes of the community’s needs led to the closure of the rural produce store. Closure of the sugar mill meant the loss of cane farming, and that he could farm was one of the largest by volume in the area. That was managed by KJS, who was deeply personally affected, as were many farmers. The constant cycles in the real estate business had to endure. He expects there will be a need to endure and adjust to any phasing out of vehicles that use petroleum products.

  16. KJN says he continues to enjoy his involvement in the running of the enterprise and attends the office every day and is responsible for the direction of the enterprise. KJN states that the tasks he completes in any day include tasks such as considering incoming mail outside the scope of the specific management roles of others, considering invoices that arrive outside the scope of any of his sons’ management roles – for example income tax, GST, land tax and the like. He sets out the process he uses to instruct his staff to make payments. There are paper records of all transactions. He has regular meetings with the accountant and keeps a daybook which records some of the important notes related to the day, this activity being something he has always done. KJN stats that even though he seeks to inform himself and obtain knowledge as best he can, he continues to obtain, seek to understand, and rely upon the advice of professionals. This is particularly so when it comes to matters of taxation and accounting. KJN states his accountant, who he meets most weeks, has not expressed any concerns about his decision making and continues to be happy to liaise with him.

  1. KJS filed an affidavit in response to material filed by KJN, KJ, and KPL. In it he set out further details of the poor relationship that existed between him and KPL and the attempts which had been made by KJN through counselling and meetings facilitated by lawyers to deal with the disputes in particular ways of ensuring transparency in business dealings. He expressed his concern about the influence KPL had over KJN and the inappropriateness of KJ as a spouse having the position she had in the business. He commented that KJN had stated he was not able to use internet banking and could no longer understand the accounts.

  2. There was a great deal of material filed in regard to the merits of various sons and KJ as decision-makers for KJN whether as proposed administrators or attorneys. Ultimately it was accepted that it was not appropriate for the proposed family members to be considered as administrators and the material in regard to the merits of the attorneys and the business profitability of the real estate of which KPL was associated and that will not be canvassed as ultimately the Tribunal determined that KJN had capacity. It was agreed by counsel at the hearing that if the ultimate finding of the Tribunal was that KJN had capacity then all of the applications should be dismissed. The relevant material in regard to capacity from the family members and KJN will be set out below.

  3. KJT in his material noted concerns in July 2017 in regard to KJN as he had signed documents which he could not recall signing and that both he and KJS were concerned as to whether KJN could fulfil his role as KR’s attorney. This was discussed as an agenda item at a family meeting. I note though that at the time no action was taken. KJT believes that in regard to the appointment of KJ to her role in the business that in as much as KJN acquiesced it was due to pressure and intimidation from KPL KJT also noted a conversation he had with KJN where he stated: ‘my memory is not so good and I have to write everything down’. KJN responded to that he could not recall making those statements, and that the making of notes and keeping of dairies is something he has done throughout his business life. KJT, who lives next door to KJN, gave an example where KJN had been confused about which of his bins was to be used for recycling. KJN explained that he had a pair of shoes which needed to be disposed of and had asked KJT whether they could be recycled. KJT also noted that KJN had had difficulty filling out a form for Meals on Wheels. KJN stated that he was trying to ensure that the meals he chose were appropriate in regard to the type of meat they had.

  4. KJT claims that KJN had signed an inaccurate statement of service for KPL and that this highlighted how KPL had influence over KJN to sign documents that are not correct. KPL stated that actions that he has undertaken in his role within the family business have been in consultation with KJN and on the basis of supporting his business decisions and directions to the best of his ability. KJT was deeply disappointed that the application was misconstrued as a “hostile takeover”. He noted that it was initiated after advice from KJN’s medical and legal professionals, and genuinely thought it to be in the best interests of KJN. KJT, in further material following confirmation that KJN had capacity to make an EPA in 2021, stated that he believed that KJN would remain in a vulnerable position if the EPA is enacted; he believes that KPL and KJ have exercised undue influence over KJN for the past 5 years and convinced him that they are acting in KJN’s best interests and the best interests of the business. KJT also asserts that KJN’s lack of knowledge and experience with information technology has meant that his suspicions are warranted.

  5. KJT raised concerns about a bank account which was the personal bank account of KJN and the one which the son’s wages were paid out of. There had been a large number of deposits and withdrawals form it over recent years which KJT considered to be out of character for KJN in particular, as he was portrayed as being frugal. KJT was concerned about the access that KPL and KJ may have to the account. While KJ had made deposits to the account as directed by KJN, she denied making any debit transfers from the account. KJN provided a table of transactions on the account over a number of years, and it is noted that the bulk of them were for wages tax and accountancy fees. There were also legal fees in more recent times, and KJT was concerned about their level. It was a later disclosed that KJN was recovering some of KPL’s legal fees in regard to the Tribunal application and matter in regard to proof of KR’s will.

  6. KJT noted that KJN had previously stated that “it would not be appropriate” for the Tribunal to appoint any one or more of his sons or family members because of the incontrovertible conflict described in the material. However, despite this statement, KJN has appointed KPL and KJ as his attorneys in his EPA. It is KJT’s belief that KJN was pressured by KPL and KJ into writing and submitting his EPA. KJN stated that is not the case. He did not consult with any other person about the making of the EPA except for the discussions with the law firm mentioned above. KJN says he appointed KPL and KJ because they are the two family members with whom he has the most interaction because they share a workplace; they are the two family members who work closest with him; their interactions are such that they have the best chance of understanding him and his views, wishes and preferences; they are both intelligent; and he is of the view that they will work together and do what needs to be done and do it appropriately and with respect to his views, wishes and preferences. KJN stated later that he does not consider there to be any real risk that the attorneys appointed KPL and KJ will act other than as the law requires them to act. He says the only risk in his view is the risk to KPL and KJ of the enquiries, criticisms, or suspicions that they may have to endure at the hands of his other sons KJS and KJT. 

  7. KJN states that in making the 12 January 2021 EPA KJN recognised he could not hope to have what his late wife and he had desired, namely for their three sons to act jointly as attorneys, and through these proceedings he has come to realise how unattainable and maybe unwise that desire might have been. Consequently, after much thought he chose to adopt what he considered to a sound and best alternative to that desire. He does not pretend that KPL and KJ will have all of the knowledge that is required to run every aspect of his business themselves. KJN cannot and does not pretend to have that knowledge himself. However, what is relevant, amongst other things are: he is confident that KPL and KJ are family members who know him well from their regular contact with him in the business environment where he currently considers and makes decisions, and he is confident that KPL and KJ will make decisions that are in line with those he might make himself. KJN notes that he chose not to obtain legal advice about the terms and conditions that he made part of it about matters important to him. He was guided by his own study and material provided by the Justices Association. He has since had the benefit of legal advice about the terms and conditions that he chooses to make part of the EPA. As a consequence of the legal advice and the opinions that he has capacity, he is considering making a new EPA, to do things like reaffirm his intention to appoint KPL and KJ as his attorney, clarify the terms and conditions he has made part of the EPA, include more comprehensive detail of his views, wishes and preferences, include a requirement that KJS and KJT should be notified of some decisions. He remains confident in his capacity to have made the 12 January EPA and knows that he made it freely and voluntarily without the influence of KPL or KJ. KPL in his material confirmed that unknown to KJ and himself KJN told them he drafted the EPA for himself in the privacy of his own home and he drove himself to have it witnessed by a JP. KPL states he had no involvement in any of the steps involved in KJN completing a new EPA. KPL later confirms that KJ converted KJN’s handwritten form into an electronic copy with the only changes being addresses and phone numbers were completed and this was simply a copy typed at KJN’s request.

  8. KJT also set out reasons why he did not consider that KPL and KJ were appropriate in the role. KJT does not believe that KJN understands the nature and effect of the EPA. This EPA allows KPL and KJ the freedom to make any decisions they see fit within KJN’s companies without any accountability or transparency. KJT and KJS will continue to be beneficiaries under these entities. Regardless of this KPL and KJ’s only obligation would be to notify the Tribunal of any significant changes or decisions at their discretion. KJT believes KJN not obtaining any legal advice about the terms and conditions of the EPA contradicts his affidavit of June 2021 where he states “he is very careful and cautious and typically risk adverse.” He chose not to seek legal advice which is totally out of character for KJN. KJT notes the witness to the EPA stating that KJN made a comment that he was being pressured to sign a new EPA. He notes also that KJN states this pressure was from his lawyers, even though they were not representing him at the time he signed the new EPA, and that this confirms the EPA was made without regard to the nature and effect of the document.

  9. KPL believes that KJN has capacity based on his interactions with him, that he continues to be heavily involved in the family businesses, and he has continued to make sound decisions even in difficult times, such as those currently being experienced due to the lengthy application defence process, the COVID pandemic, and the death of his wife in May 2020. KPL stated that he had not had any concerns or reservations about any decisions KJN has made and supports his operation of the business group and personal affairs.

  10. KJ stated that she believes KJN has capacity to make his own decisions, as she has seen no evidence to the contrary in her daily dealings with him, personally and professionally, to lead her to believe otherwise.

  11. KJS stated that from his observations KJN has difficulty remembering conversations, tasks and other things occurring in the business. It is untrue to suggest that KJN is not making any peculiar business decisions and that his business decisions appear consistent with his usual decisions that would have been made over the last 30 years. Some examples of inconsistency are KJN permitting KJ to work in his administration since 2015 and KJN incurring continual losses in the real estate business since 2014 without implementing any strategy to turn the situation around, and the recent inclusion of a blackhole expenditure account. KJS submits that KPL’s evidence about KJN is untrue. From KJS’ observations he believes KJN now struggles to understand the nature and effect of decisions that are being made for him. He no longer discusses anything with KJT and himself. He relies solely on what he is told by KPL.  KJS stated that KJN had outbursts following KR’s death and says they are examples of his loss of self-control. He says that KJN was quite prone to fly off the handle and become abusive from time to time, not only with KJS but also staff, customers, commercial tenants, and family members. KJN stated that he was annoyed with KJS as on occasions he behaves very aggressively towards him, and speaks quite rudely to him during their interactions. In regard to the 2021 EPA KJS states that he is not jealous of whatever relationship KPL has with KJN. His concern has been for many years KPL’s overbearing and bullying attitude to KJN and KR in order to get what he wants.  KPL believed that KJS and KJT are jealous of the close relationship KJN and he have. 

  12. The witness to the EPA, Ms C, gave evidence at the hearing. While she dd not provide an affidavit, her notes from the EPA signing interview and an email were filed by KJN. Ms C had a good recollection of KJN’s attendance to have his EPA witnessed. However, there was a difficulty in that when presented with the typewritten EPA document she could not identify it as the one she witnessed. She was shown the handwritten version and she said that this was the one she had seen on the day. She did however confirm that the signature and stamp of the witness on the copy of the typed EPA she was shown were hers. She stated that KJN had attended alone and that he had mentioned that there was someone pressuring him to make an EPA. She confirmed that she had not pursued the issue. She also confirmed that she had not followed the guidelines by making a note of the questions and answers she had used to determine that KJN had capacity to make the EPA. She did confirm that she had been satisfied and that she had noted that on the record of the attendance. This was done by putting a tick next to the word understanding. She said that if she had concerns she would have noted them in her log book. KJN provided the original typed and handwritten document at the hearing and copies were taken of them. He confirmed that the typewritten EPA was the one that he had signed and which had been witnessed on 12 January 2021.

The Legislation

  1. The Tribunal may appoint an administrator in accordance with s12 of the Guardianship and Administration Act2000 (Qld) (‘GAA Act’) as follows:

  2. The Tribunal may, by order appoint an administrator for a financial matter, for an adult if the Tribunal is satisfied –

    a.The adult has impaired capacity for the matter; and

    b.There is a need for a decision in relation to the matter or the adult is likely to do something in relation to the matter that involves, or is likely to involve, unreasonable risk to the adult property; and

    c.Without an appointment –

    i.The adult’s needs will not be adequately met; or

    ii.The adult’s interests will not be adequately protected.

  3. When the Tribunal is performing a function or exercising power and the Tribunal is required to make a decision about an adult’s capacity, the Tribunal is to presume the adult has capacity for the matter until the contrary is proven, in accordance with s11(1) of the GAA Act.[1] The Tribunal’s functions are set out in s81 of the GAA Act and include considering applications for the appointment of administrators, making declarations about capacity, and making declarations, orders, or giving directions in regard to enduring documents. It was submitted on behalf of KJN and KPL that KJS as the applicant had an onus of proof in regard to the applications which he brought having regard to the requirement that the presumption of capacity exists until the contrary is proven. While I made it clear at the commencement of the hearing that as all the parties were legally represented then the proceedings would be treated as adversarial, this was in terms of procedure only, so that the parties would be given an opportunity to present their material to the Tribunal with relevant cross-examination and submissions. These types of proceedings have always been inquisitorial ones, as is made clear in s12 of the GAA Act, as it is for the Tribunal to be satisfied of the matter set out in the section. It is for the Tribunal to be satisfied based on the material provided there is no onus of proof as such. All material from each party is considered in terms of the questions the Tribunal must be satisfied of.

    [1]See also ss 7(a), 11B(3) General Principle 1.

  4. Capacity is defined in the Schedule 4 Dictionary of the GAA Act as:

    Capacity, for a person for a matter, means the person is capable of –

    (a)understanding the nature and effect of decisions about the matter; and

    (b)freely and voluntarily making decisions about the matter; and

    (c)communicating them in some way.

  5. It is matter-specific, and so in the case of KJN, it is his capacity to manage his finances, having regard to the complexity of his business interests.

  6. The Tribunal is also required when performing its functions to apply the General Principles set out in S11B of the GAA Act in accordance with s11B(1) of the GAA Act. These include the following principles:

    (a)‘General Principle 2 – same human rights and fundamental freedoms’, in particular, (3)(a), ‘respect for inherent dignity and worth, individual autonomy (including the freedom to make one’s own choices) and independence of persons…’

    (b)General Principle 3, ‘Empowering adult to exercise human rights and fundamental freedoms’, at 3(a), ‘empowering an adult to exercise the adult’s human rights and fundamental freedoms.’

    (c)General Principle 4, ‘Maintenance of adult’s existing supportive relationships’ at 4(1), ‘the importance of maintaining an adult’s existing supportive relationships must be taken into account’ and 4(3), ‘the role of families, carers and other significant persons in an adult’s life to support the adult to make decisions should be acknowledged and respected’.

    (d)General Principle 8, ‘Maximising an adult’s participation in decision-making’ at 8(1), ‘an adult’s right to participate to the greatest extent practicable, in decisions affecting the adult’s life must be recognised and taken into account.’

    (e)General Principle 8 (2) ‘an adult must be given the support and access to information necessary to enable the adult to make or participate in decisions affecting the adult’s life’.

    (f)General Principle 8(3) ‘an adult must be given the support necessary to enable the adult to communicate the adult’s decisions’.

    (g)General Principle 8(6) ‘an adult is not to be treated as unable to make a decision about a matter unless all practicable steps have been taken to provide the adult with the support and access to information necessary to make and communicate a decision’.

    (h)General Principle 9 ‘performing of functions and exercise of powers’ – ‘A person or other entity, in performing a function or exercising a power under this Act in relation to an adult, must do so – (a) in a way that promotes and safeguards the adult’s rights, interests and opportunities; and (b) in the way that is least restrictive of the adult’s rights, interests and opportunities’.

    (i)General Principle 10, 'Structured decision-making’, at '10(1), ‘in applying general principle 9, a person or other entity in performing a function or exercising a power under this Act in relation to an adult...must adopt the approach set out in subsections (2) to (5)’.

    (j)General Principle 10(2), ‘First, the person or entity must recognise and preserve, to the greatest extent practicable, the adult’s right to make the adult’s own decisions; and if possible, support the adult to make a decision;’

    (k)General Principle 10(3), ‘Second, the person or other entity must recognise and take into account any views, wishes and preferences expressed or demonstrated by the adult;’

    (l)General Principle 10(4), 'Third, if the adult’s views, wishes and preferences can not be determined, the person or other entity must use the principle of substituted judgment so that if, from the adult’s views, wishes and preferences, expressed or demonstrated when the adult had capacity, it is reasonably practicable to work out what the adult’s views, wishes and preferences would be. the person or other entity must recognise and take into account what the person or other entity considers the views, wishes and preferences and preferences would be.’

    (m)General Principle 10(5), 'Fourth, once the person or other entity has recognised and taken into account the matters mentioned in subsections (2) to (4), the person or other entity may perform the function, exercise the power or make the decision.’

  1. There are also some earlier acknowledgements in s5 of the GAA Act, that is, (a), ‘an adult’s right to make decisions is fundamental to the adult’s inherent dignity;’ (b), ‘the right to make decisions includes to make decisions with which others may not agree;’ (c), ‘the capacity of an adult to make decisions may differ according to (i) the type of decision to be made including, for example, the complexity of the decision to be made; and (ii) the support available from members of the adult’s existing support network.’

  2. Mr Crofton for KJN submitted that KJN is presumed to have capacity and his right to make decisions is fundamental to his dignity. Others including KJS and KJT, may not agree with KJN’s decisions but this does not detract from KJN’s right to make them nor renders KJN’s decisions impeachable. The issue of capacity is one relating to the ability to understand, including with assistance, the issues for a decision and the capacity to make rational decisions. As was offered by Dixon J in Erdogen v Ekicic[2] in the context of the Victorian analogue of the GAA Act 1986:

    The issue of capacity is not to be assessed by whether the beneficiary’s decision is that which would be made by a person of ordinary prudence. Not every person has the ability to manage competently his or her financial affairs unaided. The inquiry is not into competence of the management process or the probable outcomes in the future. Issues about capacity concern process and achievement, the result need not be right but it needs be rationally reached.[3]

    [2] (2012) 36 VR 600 (‘Erdogen v Ekicic’).

    [3] Ibid, [73]-[74].

  3. It was noted in the submission that the provisions in regard to the General Principles had been amended with effect from November 2020 and in particular in regard to what is now General Principle 9 and 10, and which was previously General Principle 7, that the requirement in General Principle 7(5) that “…a person or other entity in performing a function or exercising a power under this Act must do so in a way consistent with the adult’s proper care and protection…” had been removed. It was submitted on behalf of KJN that the Tribunal, when considering s12 of the GAA Act, must consider the rights, interests and opportunities of the adult including the right of KJN to have appointed attorneys. It was submitted on behalf of KJS that the question still remains whether or not the arrangements put in place are sufficient to protect KJN’s interests in accordance with s12(c) of the GAA Act. Clearly, where an adult has exercised their right to appoint attorneys under an enduring power of attorney, their need for a decision-maker and the question of the protection of their interests must be considered in light of that appointment. If attorneys are appointed under a valid EPA and there is no finding adverse to them being appropriate to act as decision-makers for the adult, then it is those attorneys should be the adult’s decision-makers. However, the fact of an adult having appointed attorneys under a valid EPA in and of itself is not an end to the question.

  4. Obviously, though, the threshold issue is whether or not the presumption of capacity has been rebutted, and it is only if the Tribunal is satisfied that the adult, in this case KJN, has impaired capacity, that the Tribunal will consider the other aspects of s12 of the GAA Act. If the presumption of capacity is not rebutted then the proper outcome is for the application for the appointment of an administrator to be dismissed.

  5. The Tribunal has also been asked to make a declaration about KJN’s capacity to make an EPA in respect of the EPA of 12 January 2021, so it is his capacity to make an EPA around that date which is in question. The Tribunal may make a declaration about capacity in respect of a matter in accordance with s146 of the GAA Act. The section refers to the definition of capacity in the Schedule 4 Dictionary of the GAA Act. The definition of capacity is the GAA Act is a general one as seen above. I note that capacity in respect of an EPA is defined in s41 of the Powers of Attorney Act 1998 (Qld) (‘POA Act’) though s8(2) of the GAA Act states that if there is an inconsistency between this Act and the POA Act this Act prevails. Section 41(i) provides that a principal has capacity to make an EPA only if the principal “is capable of making the EPA freely and voluntarily; and understands the nature and effect of the EPA”. Section 41(2) of the POA Act then provides that understanding the nature and effect of the EPA includes understanding the following matters:

    (a)the principal may, in the power of attorney, specify or limit the power to be given to an attorney and instruct an attorney about the exercise of the power;

    (b)when the power begins;

    (c)once the power for the matter begins, the attorney has power to make, and will have full control over, the matter subject to the terms or information about exercising the power included in the EPA;

    (d)the principal may revoke the EPA at any time the principal is capable of making an EPA giving the same power;

    (e)the power the principal has given continues even if the principal becomes a person who has impaired capacity;

    (f)at any time the principal is not capable of revoking the EPA, the principal is unable to effectively oversee the use of the power.

  6. Having regard to the way s146 of the GAA Act and s41 of the POA act are drafted, it is clear that the definition of capacity in the GAA Act is general and the definition of capacity in regard to EPA in the POA Act is specific, so that there is no inconsistency. The definition of capacity for an EPA in the POA Act fleshes out what constitutes understanding the nature and effect of the matter in regard to the making of an EPA. The presumption of capacity in accordance with s11 of the GAA act also operates in regard to the question of capacity to make an EPA.

  7. Mr Crofton submitted, in regard to capacity to make an EPA, it is noted that s41 as discussed above sets out the definition of capacity for the purposes of an EPA and there is a presumption of capacity in s6C of the POA Act. It is stated that the Queensland Law Reform Commission articulated the argument that “a test of capacity to make an EPA which was too high a test may reduce the availability of enduring documents as a self-help expedient especially to people who experience fluctuating mental capacity etc”. The test engaged by s41 of the POA draws from the common law test for capacity provided by the High Court in Gibbons v Wright (1954) 91 CLR 423, at 437-438. The mental capacity required by the law in respect of any instrument is relative to the particular transaction which is to be effected by means of the instrument, and may be described as to understand the nature of the transaction when it is explained. The imperative that the Principal must be able to understand not just the nature of the power in general terms but to understand ‘what sort of things the attorney could do without further reference to the Principal’[4] likely applies.

    [4]Ranclaud v Young (1988) NSW Conv 5 55-385, at 57-548 per Young J.

  8. The Tribunal may also make a declaration about capacity in accordance with s111 of the POA Act in regard to enduring documents.[5] The requirements of capacity are then those set out in s41 of the POA Act and there is a presumption of capacity set out in s111A of the POA Act.

    [5]S109A gives the Tribunal the same jurisdiction as the Supreme Court of Queensland in regard to enduring documents.

  9. Mr Hastie submitted that while there is a presumption of capacity if an EPA is made, that presumption can be rebutted Re Caldwell [1999] QSC 182. The question is whether the person understood the nature and effect of the EPA at the time it was executed.

  10. The Tribunal may also make a declaration about the validity of an EPA in accordance with s113 of the POA Act. One of the grounds for declaring that an EPA is invalid is that the Tribunal is satisfied that the principal did not have the capacity to make it in accordance with s113(2)(a) of the POA Act. The Tribunal may also make an order to remove an attorney, remove a power from an attorney and give the removed power to another attorney or a new attorney or revoke all or part of an EPA in accordance with s116 of the POA Act. Applications were made to declare the EPA made by KJN on 12 January 2021 invalid or to revoke it. Having regard to the findings in regard to capacity, those applications, with the agreement of the parties representatives, will not be canvassed.

  11. In making its decisions the Tribunal is also required to comply with the requirements of the Human Rights Act 2019 (Qld) (‘HR Act’) and in particular the requirements of s13 of the HR Act, in regard to limits on human rights, which must be reasonable limits having regard to the factors set out in s13(2) of the HR Act and, relevantly to this jurisdiction, whether there are any less restrictive and reasonably available ways to achieve the purpose

The medical evidence

  1. The Tribunal made directions on 15 September 2020 for KJN to undergo a full capacity assessment. Dr DH, a geriatrician, was briefed to provide the assessment. Dr DH had a single consultation with KJN on 15 October 2020. He provided a health professional report (‘HPR’) and capacity report dated 21 October 2020. Dr DH considered that KJN had a mild cognitive impairment. Dr DH assessed KJN using the Montral Cognitive scale (‘MOCA’) with KJN currently scoring 25/30, with his score in April 2019 noted as 23/30. KJN was also administered the Addenbrooke Cognitive Exam (‘ACE’) for which he scored 88/100. Dr DH noted in regard to communication that KJN requires reading glasses and hearing aids although without such he only mishears things in a minor way. Overall Dr DH was of the opinion that KJN was able to make simple health care and financial decisions only. On the MOCA KJN scored 2/5 for delayed recall and was slow on the visuospatial test and one of the language questions.

  2. Dr DH stated in his report that he would be extremely reluctant to make the diagnosis made by Dr I of Alzheimer’s type dementia and would have favoured a diagnosis of post-operative delirium, followed by further assessment once the patient had stabilised. Dr DH noted that delirium may take several weeks, if not months, to improve. In regard to Dr BH who concluded that KJN had a dementing illness, Dr DH states “the letter does not document in what way KJN has been slowly deteriorating in his mental health and cognition.” Dr DH could also not find any documented cognitive testing by Dr BH. KJN also advised Dr DH that he had not been attending Dr BH for the previous two years. Dr DH also noted Dr SH’s interim report which concluded that KJN had suffered an episode of delirium with early cognitive changes. Dr DH notes the passing of KJN’s wife and pain developed in KJN’s left hip and shoulder in June 2020 which resulted in hospitalisation and once a slow heart rate was found the insertion of a pacemaker. There could also have been a diagnosis of polymyalgia rheumatica (‘PMR’), and KJN started on prednisolone for treatment of this.

  3. Dr DH’s clinical summary was that KJN may have been displaying some mild cognitive issues prior to his fall in April 2019, though the evidence for that is not concrete. He had an acute episode of delirium following the operation which significantly impaired his cognition. Delirium may be associated with those with a vulnerable brain prior to such as those with mild cognitive impairment and dementia. Delirium can also be associated with a permanent decline in cognition. For clarity, mild cognitive impairment is a clinical condition that is characterised by short-term memory loss and can be an antecedent to a dementia syndrome. KJN also has ongoing cardiac issues. He is also being treated with steroids for PMR, which can impair cognition. Dr DH notes that the dose of steroids does not appear to have been reduced in many months which is unusual.

  4. Dr DH provided details of his examination of KJN noting that he often referred to his diary for dates and information but was not always able to find the requested information. It was noted that KJN would sometimes provide oblique or abstract answers during the cognitive testing: he would complain he was not prepared, and it was not what he was expecting. He complained that the QCAT process had been sprung on him while he was grieving for his wife, and referring to the falling out with his son KJS, he described the process as a hostile takeover. KJN was not able to give Dr DH a history of his medical issues nor recall the names of his medications though he brought a list of them as requested. There was a piece of paper with a steroid reduction regime reducing the steroids by 1mg every 4 weeks. KJN was unable to provide a plan as to how to give himself the correct dose. KJN did not consider that he had any memory problems or word finding difficulties.

  5. Dr DH stated in regard to the ACE score of 88/100 that a score of 83 or less would be indicative of a dementia syndrome. KJN scored 16/18 for attention, 22/26 for memory, fluency 9/14, language 25/26, visuospatial 16/16. KJN had difficulty with certain words and delayed recall. Dr DH stated in regard to the MOCA that KJN failed the trail-finding portion, which was also completed slowly, which tests executive functioning and planning. Dr DH also stated that his language recall was incorrect, jumbling up the sentence, though he could calculate a simple shopping list quickly and correctly. Dr DH asked for KJN to undergo some investigations, a set of blood tests which were normal and a CT scan which was performed as a follow up to Dr DH’s assessment. Dr DH stated that it demonstrated no acute pathology. It did demonstrate changes of periventricular and deep white matter hypodensities consistent with chronic small vessel ischaemic changes. This was said to represent an interval change from an earlier scan in 2016. This therefore means KJN’s developing cognitive problems may be in part vascular-related which is also consistent with his history of coronary artery disease.

  6. Dr DH found KJN’s cognition to be impaired with issues of delayed recall, planning and verbal fluency. Dr DH was concerned by his inability to solve the problem with regards to the steroid reduction, in particular the inability to judge the timing of the reduction and the amount of the reduction. In Dr DH’s opinion this pointed to problems with planning and assessment. KJN was said to have cognitive impairment which appears to be deteriorating and would make Dr DH concerned that he is developing a dementia syndrome although he would still be hesitant to clarify which dementia syndrome. Dr DH considered that the MOCA of 23/30 taken in April 2019 may have been taken at a time of delirium and hence may not be of his baseline prior to his fall. DR DH did not believe that KJN was still suffering from delirium.

  7. Dr DH stated that it was abundantly clear that KJN has managed many financial interests throughout his life and has built up comprehensive financial assets. He clearly functioned highly in numerous endeavours achieving a multitude of skills. He has also clearly accumulated a significant amount of wisdom and knowledge. At present Dr DH believed that KJN displays capacity to manage simple financial matters as evidenced by his ability to calculate simple shopping list and serial seven calculation. Dr DH did not believe that KJN has the capacity to manage complex financial matters. Each capacity decision is decision-specific and making such a generalisation in view of the complexity of KJN’s financial affairs is not straightforward. He based his opinion on the fact that KJN displays impaired delayed recall, planning and problem solving as evidenced above. Whilst KJN clearly has accumulated wisdom and knowledge over his years, Dr DH doubted his ability to consistently remember and synthesise all the appropriate information required in complex financial matters that may arise in his numerous and complex business interests.

  8. KJN arranged for a capacity assessment to be undertaken by Prof M and Dr Z. They provided their opinion as to KJN’s current capacity to make financial decisions as that term is defined by the POA Act and the GAA Act and KJN’s capacity to make his 12 January 2021 EPA. They were provided with extensive material set out in their report. KJN was assessed by DR Z on 8 April 2021 form 9:30 am to 1:30pm and by Dr Z and Prof M on 1 May 2021 from 2:00pm to 4:40pm. They provided a summary of the medical evidence they were provided with, noting that an MMSE was 30/30. It discussed Dr SH’s report, and the report of Dr Wong, cardiologist, and a review on 16 October 2020 which stated “[KJN] seems to have had a new lease of life since he had angioplasty and stenting his LAD vessel”. They mentioned KJN’s results when tested by Dr DH and his diagnosis of mild cognitive impairment. Dr DH held concerns about the development of a dementia syndrome, although remained open to further improvement in his condition. In interpretating psychometric results, it is important not to presume incapacity because of a client’s disability, as this may constitute discrimination under the Anti-Discrimination Act1991 (Qld). The main factor to bear in mind is to carefully assess whether all steps have been taken to ensure proper communication with the patient and, if they have been, whether the patient is able to understand the information given to then give proper instructions. They also reviewed Dr BH’s notes. There is a report from KJS on 25 May 2019 where he states he felt his father was quite demented, making strange and unusual decisions. He had become paranoid, nasty, and forgetful.

  9. Prof M and Dr Z note that the bulk of the affidavit material appears to deal with conflicts within the family. There are some examples of concerns vis-a-vis health care matters, such as accepting treatment and managing medication. A key capacity assessment principle is that a person may not be able to make a decision in one domain; however, they may have capacity to make decisions in another. As such, assessments of decision-making capacity need to focus on specific decisions. Unfortunately, no clear examples were given for financial decisions other than labelling some unidentified decisions as peculiar.

Assessment

  1. KJN presented as alert and there were no difficulties with attention or focus during the interview. Instead, he maintained focus through an initial 4-hour interview with only one short break and a subsequent 2.5 hour interview without difficulty; he was dressed professionally and appropriately groomed. He wore eyeglasses for reading and his hearing aids were both fully charged and functional. KJN engaged appropriately with the interviewers and impressed as cooperative and knowledgeable. His responses were overinclusive and he would add irrelevant detail but eventually reached his goal. The interviewer did not pressure KJN for urgent responses. Although his quality of expressive fluency was reduced there were no issues with receptive comprehension. There was no sign of formal thought disorder. He described his mood as good, and his affect was of appropriate range and intensity. His thought content included worries about the subject QCAT application. There were no signs of paranoia, delusions or hallucinations, KJN had fair insight into his limitations, and he was motivated to participate in the assessment.

  2. KJN provided a detailed history including marital, employment, medical, psychological, educational and family. His responses were consistent with the facts provided in the letter of instruction and affidavit material. KJN admitted struggling with generic versus brand names of medications. He reported compliance with his medications as prepared in the blister pack. KJN completed a measure of psychological symptoms (depression, anxiety and stress scale) DASS-21 with results indicating no self-reported issues with depression, anxiety or stress. KJN was administered the Kaufman Brief Intelligence Test 2nd Ed. (‘KBIT-2’) which is used to obtain a quick estimate of intelligence (verbal and nonverbal). The IQ composite provides an overview of general mental functioning and offers a stable assessment of how KJN compares in overall intelligence with others of about the same age. The KBIT-2 scale contains two item types: verbal knowledge and riddles. The non-verbal scale is a Matrices subtest. The KBIT-2 provides high reliability and validity. KJN’s results indicated he functions in the average range for overall score (77th percentile) Verbal ability (82nd percentile) and nonverbal score (68th percentile). KJN completed a test of visual conceptual and visuomotor tracking (Trail Making Test: ‘TMT’). KJN completed part A accurately, but slower than average; it took him 83 seconds (10-20th percentile), where 36 to 79 seconds is the average. For part B he took 428 seconds (<10th percentile) where 89 to 246 seconds is average. He self-corrected one error. The task evidenced slowed processing speed.

  1. I note that at the hearing Prof M and Dr Z accepted that KJN did have a mild cognitive impairment but that did not change their opinion as they were confident that with appropriate compensatory strategies and with the time to make his decisions, he would have the capacity to make them.

  2. KJN as well as KPL and KJN supported the opinion of Prof M and Dr Z in particular as it related to functional capacity in respect of KJN’s complex financial matters as was appropriate under the GAA Act. There was an issue made by KJS about the fact that a MOCA was performed by Dr Z which was not disclosed, with a result of 26/30. Dr Z indicated that this MOCA was used at the start of the second interview to quickly ensure that there had not been any change in KJN’s capacity since the last interview several weeks before. It was also submitted that Prof M and Dr Z could not have a nuanced understanding of KJN’s Enterprises and this would lower the value of their opinion as they could not know what decisions KJN would be required to make. They made the effort to discuss KJN’s business practices with him and verify his answers with his accountant as opposed to basing their decision on KJN’s inability to deal with an issue about an unrelated matter such a dose reduction. There were also issues raised about Prof M not being present at the first interview and only being present electronically at the second. Dr DH noted that it was his preference to be present in person to conduct his examination but did not fault the process of Prof M and Dr Z. Dr DH also noted that while KJN’s score of 27/30 on the MMSE was normal it was not the same normal a when he scored 30/30 in 2017. While Prof M and Dr Z considered from the material that there were no specific examples of compromised financial decisions, it was submitted on behalf of KJS that examples included the appointment of KJ to work in accounts in 2015, the real estate agency running at a loss for many years and a commercial property not being rented and costing the business $22,000 a year. Prof M and Dr Z discussed the real estate losses with KJN and he acknowledged them, in particular the effect of Covid, and steps he would take to deal with this. At the hearing KJN confirmed that there had been some improvement in the business, noted that administration costs were debited to that business and that there were costs associated with having a sales window at one of the service stations. Prof M and Dr Z tailored their approach to assessing to be one having regard to his difficulties they gave him plenty of time and used more extensive such at the TMT test to show that given time KJN could complete the task so that his performance on the MOCA was not truly indicative of his capacity in the same way he performed better on the memory component of the ACE-R than the MOCA. It is clear, though, that ultimately they accepted that KJN had mild cognitive impairment, though again, if KJN had time and was properly advised so that the matters he need to make decision on such as a new tax were in writing, they would consider that he had capacity to make that decision.

  3. KJN’s performance as a witness under cross-examination was also raised as an issue by KJS. I note that with his verbal fluency difficulties, which were acknowledged by all medical experts, not going to capacity, there would be some issues with meandering answers from KJN. The areas raised by KJS related to KJN being unable to name the beneficiaries of the trusts nor acknowledge that as a director he would have duties to the companies. In response on behalf of KJN it was submitted that it would not be unusual to not be able to name the extensive list of beneficiaries of a trust and that he only indicated his honest answer, that he had not considered his duties as a director. KJN runs businesses through various structures all of which he controls. I am not surprised at his responses to those questions and do not consider them germane to the issues before the Tribunal. KJN also had a memory lapse in regard to an affidavit he executed in respect of a challenge his son made to his late wife KR’s will, and stated that he had not challenged her will. He was not a party to the challenge, and he had honestly forgotten the affidavit. I do not consider an isolated memory lapse goes to capacity.

  4. I am satisfied that KJN has a mild cognitive impairment and that he has insight into his deficits and with the appropriate compensatory strategies he has capacity to make all financial decisions. I make particular note of the fact that his score on an MMSE is still normal and that he still operates albeit with slowed cognition with normal verbal and non-verbal intelligence. While Dr DH made the point that KJN does not have the same level of capacity he had in 2017 I am asked to make findings as to his capacity, as was submitted on behalf of KJN, as at the day of the hearing. On that basis the presumption of capacity has not been rebutted for the purpose of considering the appointment of an administrator in accordance with s12 of the GAA Act and the application for administration is dismissed.

  5. There is also an application in regard to KJN’s capacity to make an enduring power of attorney on 12 January 2021. This is in accordance with s146 of the GAA Act and s111 of the POA Act. The requirements for capacity in respect of an EPA are set out in s41(2) of the POA Act. There is a presumption of capacity in both acts as noted above. These declarations are in general and not in regard to any specific EPA, as that application would be in regard to the validity of a specific EPA, and the principal not having capacity is a ground to declare an EPA invalid in accordance with s113(2)(a) of the POA Act. Prof M and Dr Z were of the opinion that KJN had capacity to make an EPA. The Tribunal directed that a capacity assessment be prepared specifically in respect of EPA, and that was performed by Dr VH of 2 June 2021. Dr VH performed a MOCA scoring 23/30, noting normal was 26 or more, and an MMSE scoring 28/30, which was a normal score. She noted some memory loss and that his cognitive testing confirmed mild cognitive impairment. Dr VH assessed KJN’s capacity to make an EPA using the Queensland capacity guidelines 2021, and KJN was able to demonstrate that he understood the relevant matters. She was satisfied that he had the capacity to appoint an EPA, and in the absence of any evidence of recent fluctuations in cognition, he would have had capacity to execute an EPA on January 2021. Dr DH provided a supplementary report and while he did not test KJN for capacity to make an EPA he did not disagree that KJN would have the requisite capacity. I note that the witness to the 12 January 2021 EPA was also satisfied that KJN had capacity to make an EPA.

  6. KJN, KPL, and KJ supported that KJN had capacity to make an EPA. KJS while accepting the medical evidence raised issues about the EPA executed by KJN on 12 January 2021 in terms of inconsistent clauses about such things as when it would commence and what instructions KJN could give such as in regard to his attorneys taking over his responsibilities as sole governing directors of his companies. It was also raised that KJN misunderstood how much involvement he would have in decision-making once the EPA was enacted. When submissions were made by KJN and KPL and KJ that KJN’s understanding was correct this was acknowledged and the submission were not pursued. It was submitted on behalf of KJN and KPL and KJ that any drafting errors did not go to capacity but competency as there was no legal advice. I accept that submission. In regard to the directorships, I asked KJN if he thought what he said in the EPA was sufficient to appoint the attorneys as sole governing directors and he considered it was. I was impressed that he had thought through that his attorneys would need to be appointed in those roles to control the companies as they could do this as his attorneys. This point was explained to KJS in submissions from KJN which I accept. There is nothing in KJN’s oral evidence which I consider affects the medical expert’s opinion in regard to his capacity to make an EPA and I am satisfied that he has that capacity. I declare that KJN had capacity to make an EPA on 12 January 2021.

  7. There was an application for an order about an EPA. There were a great many submissions as to the validity in accordance with s113 of the POA Act of the 12 January 2021 EPA, having regard to the lack of recognition of the typed documents by the witness, the suitability of KPL and KJ as attorneys, and the calling for the EPA to be revoked on that basis in accordance with s116 of the POA Act. It was mentioned above that if the Tribunal found that KJN had capacity to make an EPA then there was no utility in pursuing the application as KJN with capacity could make a new one. As KJN has been found to have capacity to make an EPA the application for an order about an EPA is dismissed.


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Citations
KJN [2024] QCAT 53
Cases Citing This Decision

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Cases Cited

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Statutory Material Cited

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Murphy v Doman [2003] NSWCA 249
Murphy v Doman [2003] NSWCA 249
Re Caldwell [1999] QSC 182