JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL
STREAM: HUMAN RIGHTS
ACT: GUARDIANSHIP AND ADMINISTRATION ACT 1990 (WA)
CITATION: M [2008] WASAT 262
MEMBER: MS J TOOHEY (SENIOR MEMBER)
MS H LESLIE (SENIOR SESSIONAL MEMBER)
MR J MANSVELD (MEMBER)
HEARD: 28, 29 AND 30 OCTOBER 2008
DELIVERED : 7 NOVEMBER 2008
FILE NO/S: GAA 1454 of 2008
GAA 2082 of 2008
BETWEEN: G
Applicant
AND
E
Interested PersonM
Proposed Represented Person
Catchwords:
Administration - Proposed represented person incapable of managing her affairs by reason of dementia - Need for someone with lawful authority to act on her behalf - Intense conflict between her sons - Relatively complex estate - Whether enduring power of attorney a less restrictive means of meeting needs - Conflict of interest - Son donee of enduring power of attorney failed to appreciate the obligations of an attorney - Even if no conflict of interest for the attorney, conflict between sons made it unworkable for him to act as attorney or administrator - Consideration of wishes of proposed represented person - Public Trustee appointed plenary administrator
Legislation:
Guardianship and Administration Act 1990 (WA), s 3, s 4(2), s 64(1), s 68, s 77, s 82, s 97(1)(b)(iii), s 107, s 108(1)(a), s 108(1a), s 109(1)(c)
State Administrative Tribunal Act 2004 (WA), s 90
Result:
Enduring power of attorney revoked and Public Trustee appointed plenary administrator
Category: B
Representation:
Counsel:
Applicant: Mr J Hammond
Interested Person : Mr R Butcher
Proposed Represented Person : Mr D Cooper
Solicitors:
Applicant: Hammond Worthington
Interested Person : Butcher Paull & Calder
Proposed Represented Person : Cooper Legal
Case(s) referred to in decision(s):
Hospital Products Limited v United States Surgical Corporation and Others (1984) 156 CLR 41
REASONS FOR DECISION OF THE TRIBUNAL:
Summary of Tribunal's decision
M was an elderly woman who spoke little English. Her husband had died and her sons, G and E, were in dispute over the management of her financial affairs. Her estate included residential properties, interests in a family company and family trust, and she was a party to, or had an interest in, various legal proceedings including proceedings against her for default on a loan for which her investment property was security.
G lodged applications under the Guardianship and Administration Act 1990 (WA) for orders revoking enduring powers of attorney (EPA) made by M and appointing the Public Trustee her administrator.
M and E maintained that she was capable of managing her estate.
The Tribunal found, on the evidence of three geriatricians and M's general practitioner, that she was unable, by reason of dementia, to make reasonable judgments about her estate and that she needed someone with lawful authority to act on her behalf.
The Tribunal was not satisfied that it was in M's best interests for E to manage her estate. In many respects their property and interests overlapped. M had transferred substantial assets to E in circumstances in which her understanding of the transactions was questionable, and she had executed a new will under…
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- AGLC
- M [2008] WASAT 262
- Case
- [2008] WASAT 262
- Decision Date
CaseChat Overview and Summary
The court considered the legal obligations of an attorney under the Act, emphasising the fiduciary duty owed by E to M, and the potential conflict of interest arising from E's role as a beneficiary under M's will and his ongoing disputes with G. The court held that E's actions demonstrated a failure to separate his interests from M's, and it was unlikely he could act impartially given the existing conflict. The court also noted that appointing E as administrator would not resolve the conflict and could further complicate M's estate management.
Given the complexity of M's estate and the significant conflict of interest between the sons, the court decided that E could not act as M's attorney or administrator. The court appointed the Public Trustee as M's plenary administrator, recognising the need for an independent party to manage her affairs and interests.
The final order was that the Public Trustee be appointed as the plenary administrator of M's estate, with the authority to manage all aspects of her affairs, including resolving conflicts with E and G, and potentially reversing the transfer of M's interests to E.
Orders
Orders of the court
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Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
Established by: MS J
Section 107 of the Act provides that the donee of an EPA shall exercise his powers as attorney with reasonable diligence to protect the interests of the donor. The relationship is one of trust and confidence. The donee, as fiduciary, is bound to act in the best interests of the donor to the exclusion of his own. In Hospital Products Limited v United States Surgical Corporation and Others (1984) 156 CLR 41, Gibbs CJ said at [67]:A person who occupies a fiduciary position may not use that position to gain a profit or advantage for himself, nor may he obtain a benefit by entering into a transaction in conflict with his fiduciary duty, without the informed consent of the person to whom he owes the duty. Section 68 of the Act provides that an administrator shall be someone who will act in the best interests of the person concerned and who is otherwise suitable to act as administrator of their estate. The mere fact that E is a beneficiary of M's will does not, in our view, preclude him from acting as her attorney but it underlines the extent to which their interests coincide and may conflict. In arranging the transfer of his mother's interests to himself, E may have honestly believed that doing so would protect her property from dealings by G. However, he profited directly from those transactions. He did not arrange for M to have independent advice, even after the solicitors for G had put him on notice of their concerns about her lack of independent advice. He appears not to differentiate his interests from those of his mother. Given M's apparent lack of experience and understanding of commercial matters, it is unlikely to have been her idea to transfer interests to E but, even if it was, he appears still not to have appreciated the need to separate his mother's affairs and interests from his. The Tribunal is not satisfied that he would do so in future. Managing M's estate in her best interests will involve a wide range of matters including establishing the full nature, extent and location of her property and interests; responding to legal proceedings to which E also is a party or has an interest; and other matters such as determining whether the rent from the tenanted property is adequate. It is submitted for M that she is incorrectly named as a respondent to the proceedings against the family company and any claim against her must fail but that does not answer the conflict that E might have if acting on her behalf. He is also a party to those proceedings and, even if their interests coincide, he would still be required as attorney or administrator to recognise any conflict of interest and put M's interests before his own. We are not satisfied that he would necessarily be able to do so. M has an interest in the proceedings commenced by G to wind up the family company and needs someone independent who can decide how to responded. We are not satisfied that E could put aside the conflict with G and act solely on M's behalf. A further matter which anyone acting on M's behalf will need to consider is whether any action should be taken to reverse the transfer of her interests to E. Section 82 of the Act provides that an administrator may apply for an order setting aside certain transactions entered into within two months prior to a declaration of incapacity and there may be other action open to an administrator or attorney. E's interests would conflict directly with his mother's in relation to her principal residence and may conflict in relation to the family company.