MMD
[2015] QCAT 493
•2 December 2015
| CITATION: | MMD [2015] QCAT 493 |
| PARTIES: | MMD |
| APPLICATION NUMBER: | GAA1717-15 |
| MATTER TYPE: | Guardianship and administration matters for adults |
| HEARING DATE: | On the papers |
| HEARD AT: | Brisbane |
| DECISION OF: | Member Allen |
| DELIVERED ON: | 2 December 2015 |
| DELIVERED AT: | Brisbane |
| ORDERS MADE: | 1. FJ and PG as administrators for MMD must pay the Public Trustee of Queensland the amount of $3,000 within 14 days of today. |
| CATCHWORDS: | GUARDIANSHIP AND ADMINISTRATION – request for reimbursement of former administrator’s expense – whether amount requested was reasonable. Guardianship and Administration Act 2000 (Qld) ss 11, 34, 47, 48 and 59, and Schedule 1 General Principle 10. |
APPEARANCES:
This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (QCAT Act).
REASONS FOR DECISION
Introduction
The Public Trustee of Queensland was appointed as administrator for MMD on 4 March 2014 for the legal matter of investigating her entitlement to bring a family provision claim against the estate of her late mother. This was a result of concerns held by the Tribunal that PG, the administrator for MMD was also a beneficiary and executor of the estate of her late mother and she had not given consideration as to whether or not MMD should make a claim for further and better provision from her late mother’s estate. MMD’s mother had four children including the adult and an estate valued at approximately $300,000. MMD received a gift of $11,665.61 from her late mother’s estate.
The Tribunal initiated a compensation[1] application due to PG’s failure as administrator to take steps to protect MMD’s right to bring a family provision application. The Public Trustee was appointed by the Tribunal for one year to investigate the matter and report back to the Tribunal with recommendations before a final decision was made. PG was directed to cooperate fully with the Public Trustee and to provide the Public Trustee with any funds requested by the Public Trustee to undertake the investigation.
[1]Guardianship and Administration Act 2000 (Qld), s 59.
PG appealed the Tribunal’s decision, which appeal was subsequently dismissed. The Public Trustee had requested payment from PG of the amount of $3,000.00 towards the initial costs of the investigation, which was refused both before and after the Appeal.
The Public Trustee as requested prepared a report for the Tribunal dated 17 April 2015. The report noted that from preliminary investigations MMD would have had a prima facie right to commence a family provision application. The Public Trustee was not in a position to offer an opinion on quantum without the advice of counsel as the estate was worth approximately $300,000.00. The Public Trustee recommended in regard to the compensation claim that PG be ordered to pay the amount of $25,000 to the Public Trust for current legal fees estimated at $13,500 plus GST including related to the current report and the Appeal; counsel’s fees of $5,000 for an opinion on quantum and further legal fees of $5,000 inclusive of GST for the Public Trustee’s final report.
The Tribunal reviewed the Public Trustees appointment and considered the compensation order at a hearing on 21 April 2015. It was made clear to the Tribunal that PG was impecunious and there was little prospect of PG paying any compensation award made against her. At that time, MMD had an amount of approximately $12,000.00 in her bank account. The Tribunal determined then to dismiss the application for compensation and revoke the appointment of the Public Trustee. Clearly, the Public Trustee had incurred costs and there needed to be consideration as to what amount it would be entitled. Directions were made for the Public Trustee to submit a statement of its costs and outlays in respect of MMD with full narration and any submissions in regard its right to payment. The other active parties were also given an opportunity to make submissions in reply.
The Public Trustees’ submissions
The Public Trustee provided its submissions in a report dated 19 May 2015. The total amount claimed was $14,553.43 with disbursements of $116.56 in respect of costs claimed by the Official solicitor and the amount of $1,081.15 for the Public Trustees costs. The costs for the official solicitor were said to relate to the following:-
a) Perusing all documents received from the Public Trustee, the Tribunal and Studman legal (for PG);
b) Drafting correspondence to and reading correspondence from the Public Trustee, the Tribunal and Studman legal;
c) Telephone attendances with the Public Trustee in relation to MMD;
d) Drafting the report and recommendations of the Public Trustee to the Tribunal;
e) Preparing for the hearing on 21 April 2015; and
f) Appearance at the hearing on behalf of the Public Trustee on 21 April 2015.
The Public Trustee submitted that the legal costs were reasonable for the following reasons:
a) The time spent by the legal officers to carry out the work described above, is not excessive; and
b) The rates charged by the office of the official solicitor are standard rates and are not excessive.
The Public Trustee also provided a breakdown of its charges in regard to MMD. These included:
a) Correspondence and phone calls to PG and Mr Studman;
b) Consideration of the Public Trustee’s role having regard to the Appeal;
c) Preparation of instructions to the Official Solicitor to provide advice in respect to a family provision claim on behalf of MMD;
d) Preparation of instructions to the Official Solicitor to provide advice in respect to the Appeal;
e) Undertake a review of the archived records relating to MMD;
f) Seeking advice about and correspondence in respect of an extension of time.
g) Preparation for and attendance at Tribunal hearing by the Director of Client Services (4hours and 48 minutes) not charged.
Active parties’ submissions
The active parties submissions in reply requested that MMD be absolved of all liability to pay any of the costs incurred in what was described as this failed appointment and investigation. It was submitted that the estate of MMD’s mother was valued at $260,000.00 with her share being $11,665.00 with the costs of the Public Trustee of $16,634.69 exceeding her share of the estate by $4,979.69. That no report or other benefit was produced by the Public Trustee. The Tribunal has dismissed the application for compensation and revoked the Public Trustees appointment. In view of the fact that no report was produced, it is unconscionable to claim any amount from MMD and the Member should have considered all of the circumstances in regard to MMD’s monetary position and the potential costs before issuing the direction. The Tribunal notes that the appointment of the Pubic Trustee was subject to an Appeal which was refused and this is not an examination of the Member’s decision but a consideration solely of what expenses if any the Public Trustee is entitled to.
Further, if MMD is required to pay the whole amount she will have no cash remaining, she would no longer be able to enjoy little outings and other small luxuries and an additional burden would be placed on her sisters. This was considered to be a punishment of MMD
The Public Trustee should have been aware that the estate was not significant and that MMD’s share was very small and should have known that their fees would add up to a significant amount. Despite this, the Public Trustee went on to incur costs in the amount they did. There is an equitable obligation on the part of the Public Trustee to keep costs to a minimum or at least advise the Tribunal that an injustice will occur if they are to continue to incur costs.
The Tribunal notes that it is the fact that MMD’s share of the estate was comparatively small that the compensation application was initiated. The purpose of a family provision application is to enlarge the share of the estate to which a disappointed beneficiary is entitled. Consideration always needs to be given to the potential quantum of any claim against the cost of obtaining that amount as well as the financial resources of the potential claimant.
There are submissions made that the Public Trustee failed to produce a report and still seek to claim $16,634.69. This is clearly not the case as the Public Trustee did produce a report indicating that MMD had a prima facie claim and outlining what steps were necessary to determine the quantum of the claim. The Tribunal therefore does not accept the submissions in regard to there not being a report.
It was noted that the original Member stated he was satisfied that MMD’s sisters were taking good care of her and that they had signed a deed of agreement to protect her. The Member in his reasons though noted in regard to the deed that there was no mechanism for the parties performance to be monitored independently. That there had been a good deal of time passed since the administrative oversight by PG and it was clear to the Member or ought to have been clear, that the sisters had not swayed in there love and support for MMD.
That no person should be worse off than before the state intervened to “protect” him or her by taking MMD cash and leaving her with a debt of $4,979.69.
Discussion
The Tribunal starts from a consideration of the legislative basis upon which an administrator is entitled to be reimbursed for their expenses. This is contained in s47 of the Guardianship and Administration Act 2000 (Qld) (the Act) and it is clear that the entitlement is subject to the requirement that the expenses be reasonable. An administrator is required to apply the general principles[2] and in particular, here general principle 10 Appropriate to Circumstances – power for a matter should be exercised by an administrator for an adult in a way that is appropriate to the adult’s characteristics and needs. That includes the adult’s financial circumstances and therefore when considering whether expenses are reasonable they must be reasonable having regard to the adult’s financial circumstances.
[2]Ibid, ss 11 and 34.
The Public Trustee was given a specific appointment by the Tribunal and it was expected that costs would be incurred hence PG was directed to provide the Public Trustee with funds. The Public Trustee requested $3,000 towards the initial cost of the investigation. This was never received. In the end, the Public Trustee was able to produce a report indicating that MMD would have had a claim but the cost of determining what the likely amount of that claim was and thus the amount of compensation to be awarded against PG was estimated to be $25,000.00, this included costs to date of $14,850.00.
It is noted that the remuneration of the Public Trustee is a separate issue and there is no question that the Public Trustee is not entitled to remuneration having regard to s48 of the Act. The Public Trustee was appointed by the Tribunal for a purpose and it has fulfilled that purpose by investigating MMD’s claim and providing its report to the Tribunal. The amount claimed for the Public Trustees remuneration is $1,081.15 and this amount will be allowed
While the legal expenses incurred by the Public Trustee may have been objectively reasonable in terms of not being excessive, were they reasonable having regard to the fact that MMD had limited funds and there does not appear to have been any consideration given to the ultimate amount she may receive against any additional cost?
The Public Trustee did not provide submissions in regard to whether the expenses were reasonable having regard to the requirements of the Act. The Tribunal acknowledges the submissions made on behalf of the other active parties that it was not reasonable for MMD to be expected to pay the amount claimed for legal costs having regard to her financial circumstances and these circumstances should have been taken into account before additional costs were incurred by the Public Trustee.
The Tribunal considers that a reasonable amount for the expenses of the Public Trustee incurred in instructing the official solicitor in this matter are $1,918.85 which when taken with the amount allowed for remuneration total $3,000 which was the amount originally sought by the Public Trustee.
The Tribunal orders that FJ and PG as administrators for MMD must pay the Pubic Trustee of Queensland the amount of $3,000 within 14 days of today.
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