NMC (Review of Enduring Powers)
[2019] TASGAB 6
•5 April 2019
CITATION: | NMC (Review of Enduring Powers) [2019] TASGAB 6 |
HEARING DATE(S): | 8 February 2019, 7 March 2019 |
DATE OF ORDERS: | 5 April 2019 |
DATE OF STATEMENT OF REASONS: | 5 April 2019 |
BOARD: | Ms Sandra Taglieri Mr Gerard Dibley Mr Richard Grueber |
APPLICATION | Review of Enduring Power of Attorney |
CATCHWORDS: | Review of Enduring Power of Attorney – attorney acting in best interests of donor |
LEGISLATION CITED: | Guardianship and Administration Act 1995 (Tas), ss 5, 6, 11 Powers of Attorney Act 2000 |
CASES CITED: | Briginshaw v Briginshaw, [1938] HCA 34; (1938) 60 CLR 336 |
Statement of Reasons
Introduction and background
On 7 March 2019, the Guardianship and Administration Board (the Board) constituted by 3 Members, conducted a hearing in relation to review of an Enduring Power of Attorney. The application was made by MWC (a daughter of the donor of the Enduring Power of Attorney, NMC (the donor)).
The donor is a 91 year old lady who was at the time of the hearing residing at [the Aged Care Facility]
The hearing was in respect of the application which had previously been adjourned on 8 February 2019, by a differently constituted board who had not received evidence or considered the application in substance, instead adjourning the application to a later date.
Evidence before the Board - The Enduring Power of Attorney (the Instrument)
The Board had before it the Instrument appointing BMX and KQX as donees. The Instrument also named Tasmanian Perpetual Trustees Limited as a substitute donee. A copy of the Instrument was received into evidence and was executed on 6 August 2008 and registered as PAXXXXX , on 28 July 2014 (“the Instrument”).
The Instrument had been prepared by officers of Tasmanian Perpetual Trustees Limited and the Board reviewed the Instrument and was satisfied that it complied with the requirements of section 30(1) of the Powers of Attorney Act 2000 (‘the POA Act’).
The basis for the application for review
MWC made a written application dated 17 December 2008 for review of the Instrument. The application was extensive comprising 32 pages. Subsequent to filing the application MWC filed other materials and the Board also had the following documents before it and considered the same:
i.Application MWC 17/12/2018
ii.ACAT Myagedcare 27/01/2016
iii.EPA NMC 28/07/2014
iv.Will of NMC 08/08/2008
v.Submission updated application with addendum and attachments MWC 14/01/2019
vi.Submission BMX 01/02/2019
vii.Submission MWC 01/02/2019
viii.Adjournment Order 08/02/2019
ix.Notes of Decision 08/02/2019
x.HCPR Dr James Braithwaite 04/02/2019
xi.Documents submitted at hearing MWC 08/02/2019
xii.Will of HC 13/08/2004
xiii.Medical report Dr James Braithwaite 22/02/2019
xiv.Statement NMC 07/02/2019
xv.Financial Statements 2015-2019
The attorneys were given notice of MWC’s application as was Tasmanian Perpetual Trustees Limited. In addition various persons were given notice as interested parties in respect of the review application. They were:
·Dr James Braithwaite, NMC’s General Practitioner
·QX, NMC’s son in law and husband of attorney, BMX
·KQX, grandson of NMC
·TX, grandson of NMC
·KH, CEO and Director of Care at [the Aged Care Facility].
Although the above peoples were notified of the application and the hearing to be conducted on 7 March 2019, ultimately the only persons to participate in the hearing were MWC as the applicant, BMX and QX and a representative of Tasmanian Perpetual Trustees, Mr Philip Wheeldon. The attorney, BMX, was represented by a solicitor: Mr. Craig Mackie.
Materials received prior to hearing
Prior to the hearing, Mr Mackie filed various materials in response to the contents of MWC’s application for review. The materials received on behalf of the attorney BMX and considered by the Board were:
i.Report signed by BMX dated 01/02/2019
ii.Statutory Declaration of BMX dated 31/01/2019
iii.Statutory Declaration of QX dated 31/01/2019
iv.Letter from [the Aged Care Facility] dated 31/01/2019
The hearing and additional submissions received by the Board
On 7 March 2019, the Board’s hearing was conducted following an earlier adjournment of the application on 8 February 2019. At the hearing on 7 March 2019, the Board’s members received further submissions from the applicant MWC and also Mr Mackie and BMX. Mr Wheeldon made submissions on behalf of Tasmanian Perpetual Trustees, due to the nature of some allegations made by MWC.
The materials relied upon by MWC were voluminous but in essence MWC agreed with the summation by the Chair of the Board, that the substance of her contentions were:
a)That the Instrument may not have been valid due to it being created at a time when the donor lacked capacity to make the Instrument. In essence MWC relied upon a contention that at the time of making the Instrument in 2008, the donor may not have understood the nature and effect of the Instrument, hence the requirements of subsection 30(3) of the POA Act were not satisfied; and
b)That the attorney, BMX had acted contrary to her fiduciary duties to the donor in management of her financial estate. Various allegations were made in respect of improper use of the donor’s property and other funds and assets.
During the hearing the Chair asked MWC for confirmation that insofar as (b) above was concerned, the essential contentions were that MWC’s concerns related to three main points being:
i.Selling real estate owned by the donor for less than market value;
ii.Unexplained transactions in the donor’s bank accounts that did not evidence whether they were for the benefit of the donor;
iii.That there may have been a conflict of interest in respect of creation of the Instrument because it was alleged that KQX and Mr Wheeldon both worked at Tasmanian Perpetual Trustees.
The Chair’s purpose in identifying the issues outlined in paragraphs 11 and 12 above was because of the sheer volume of material that had been filed and placed before the Board.
Although the Board had received all of the materials identified in paragraph 6 and read them, much of the materials clearly related to grievances that MWC had in respect of a family falling out, and in particular a breakdown of her relationship with the donor. This material also identified that MWC was aggrieved by not having been a beneficiary to her late father’s estate and also that she was not to be a beneficiary to the donor’s estate.
The materials filed by MWC conveyed a clear picture of a family breakdown and dysfunction. The Chair advised MWC that these concerns were not matters within the jurisdiction of the Board such that the Board did not have any power to make orders or determinations concerning such grievances.
Having focused the parties attentions to the relevant matters arising upon the review of the Instrument, extensive submissions were made orally. However, there was insufficient time for MWC to make an address that replied to all of the submissions made by Mr Mackie on behalf of BMX. Accordingly MWC was given leave to file a further written submission to ensure that she was afforded an opportunity to respond fully to Mr Mackie’s submissions.
On 18 March 2019[S1] [S2] [S3] [RK4] , MWC filed a further submission comprising of twenty typed A4 papers together with attachments “A” - “E” inclusive being:
· Attachment “A” Aged Care Client Record dated 29 January 2016
· Attachment “B” Health Care Practitioner Report of Dr Braithwaite dated 4 February 2019
· Attachment “C” Report of Dr Braithwaite dated 22 February 2019
· Attachment “D” Premium Property Report relating to [Hobart area]
· Attachment “E” Standardized Mini-Mental State Examination template form
Each member of the Board considered the additional submissions provided by MWC and then as envisaged at the conclusion of the hearing on 7 March 2019, deliberated to provide a written determination of MWC’s application.
Consideration of the application and issues arising, including relevant evidence and information
In MWC’s written submissions of 18 March 2019, she raised the possibility that a member of the Board conducting the hearing on 7 March 2019 may have had a possible conflict of interest.[1]
[1] See page 4 of written submission
The Chair of the Board specifically requested that the Member, Mr Grueber, address the matters contended by MWC. On the basis of the reasons which follow, the Board is satisfied that Mr Grueber did not have a conflict of interest and further that no bias or perceived bias arises in respect of his involvement in the hearing. There was no reason he could not discharge the powers of the Board pursuant to its functions under the POA Act. The Board arrived at this conclusion for the following reasons:
· Mr. Grueber, is a partner in the firm Ogilvie Jennings and has not personally had any dealings, professional or otherwise, with MWC, NMC, BMX or QX, other than in the course of the hearing of the application.
· Mr Grueber conducted searches in Ogilvie Jennings’ file management system. A search of MWC, NMC, BMX and QX disclosed no active files or past files since their current file management system was installed in June 2015. A file search of client registration details under the system in place prior to June 2015, indicated that the firm had held documents for BMX but no files for her or any other party.
· The searches did not disclose any records in respect to MWC’s contact with Ogilvie Jennings and it is assumed that they were in the nature of preliminary contact that did not result in a file being opened or work undertaken.
· Mr. Grueber did not make any direct enquiries with any practitioner at the firm.
It did not appear that MWC was asserting any actual bias, and there is no basis for such an assertion. The joint judgment of Gleeson CJ, McHugh, Gummow and Hayn JJ in Ebner v The Official Trustee in Bankruptcy [2000] HCA63 at [6] is relevant and their Honours said that “a judge is disqualified if a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question the judge is required to decide”. At [8] their Honours observed that the application of the principal requires two steps. The first is identification of what it is said might lead a Judge to decide a case other than on its legal and factual merits. The second is an articulation of the logical connection between the matter and the feared deviation from the course of decided the case on its merits. In Webb v R [1994] HCA30 Deane J (in a dissenting but often cited Judgment) identified four main categories of bias. The only category that might be open on the facts of this case is disqualification by association, where the apprehension of bias results from some direct or indirect relationship, experience or contact with a person or persons interested in, or otherwise involved in, the proceedings. Any relevant association in this case is tenuous to say the least.
In Brooks v Easther [2017] TASFC12 at [48] the Full Court of the Supreme Court of Tasmania considered the attributes of the fair-minded lay observer in the Ebner test and noted that he or she is taken to be reasonable, does not make snap judgements, knows commonplace things, is neither complacent nor unduly sensitive or suspicious and is to be attributed with knowledge of all the circumstances of the case.
The Board also observes the following well-established principles:
· There is a duty to not too readily accede to applications for disqualification (see Re JRL; Ex parte CJL [1986] HCA39; and
· The fact that if the hearing of a matter has already previously been adjourned to a fresh panel following the attendance of all the parties, and that the application has been heard, recusal may require the parties to go to the expense and inconvenience of a further hearing before a new panel. This being plainly undesirable and contrary to the objectives and the procedures of the Board[2].
[2] Sections 5, 6, 11 of the Guardianship & Administration Act, 1995.
The Board does not consider that any contact between MWC or BMX and Ogilvie Jennings, of which the Board has no knowledge other than as set out in these reasons, is sufficient to engage in a fair-minded lay observer an apprehension that I would not determine the application on its merits.
The donor’s capacity
The only evidence of a medical nature received by the Board concerning the donor’s understanding of the nature, purpose and effect of an Enduring Power of Attorney is effectively anecdotal and to be inferred from the ACAT report of 2016, the Health Care Professional report of Dr Braithwaite of 4 February 2019 and letter of Dr Braithwaite dated 22 February 2019.
The Health Care Professional report identifies that the donor’s dementia had been evident for 3 years. As the report was prepared in February 2019, this by inference means that Dr Braithwaite considered the diagnosis of dementia to be present from February 2016. The Aged Care Client Record identifies a diagnosis of dementia at the time of assessment on 27 January 2016 but gives little information about the degree of cognitive impairment at that time.
Dr Braithwaite’s report of 22 February 2019 is perhaps the most detailed in respect of providing some picture of the donor’s capacity to understand the nature of the Instrument when it was created in 2008. At paragraph 2 of the report it identifies that the diagnosis of dementia was in 2014. This appears to contradict the statement in the Health Care Practitioner Report where Dr Braithwaite states that the dementia had been present for some 3 years. It is doubtful that anything of material significance turns upon this inconsistency. Dr Braithwaite has opined in his report of 22 February 2019 that at the time he assessed the donor in February 2019, she was suffering from mild to moderate dementia, but he was unable to provide any information about the extent of dementia symptoms in 2014 or indeed earlier in 2008 when the Instrument was created.
Regrettably the medical evidence before the Board was limited, so the Board therefore needed to take into account information and evidence received from BMX and Mr Philip Wheeldon about the donor’s cognitive state in 2008. MWC did not offer any relevant or prohibitive evidence to the effect that the donor’s cognitive state and capacity was impaired in 2008.
Without repeating the evidence received by the Board at the hearing on 7 March 2019 in full, Mr Wheeldon was firm and unmoved about his dealings with the donor in 2008. He conveyed that in speaking with her, there was no indication whatsoever that she did not understand the nature and effect of the Instrument. He specifically gave evidence about the usual practices of ensuring to explain to a donor the requirements of subsections (2) and (3) of section 30 of the POA Act and satisfying themselves of comprehension of those matters.
BMX gave evidence that at the time of the hearing, the donor’s cognitive state was still such that she was able to communicate with her regarding wishes and preferences concerning spending of money and dealing with the donor’s financial estate generally. BMX’s evidence to this effect appeared to be corroborated by Dr Braithwaite’s views at paragraph 6 of his report of 22 February 2019. Based on the collective evidence from BMX and Mr Wheeldon, together with the absence of any persuasive evidence that the donor suffered from dementia in 2008 the Board is satisfied that the Instrument was validly created in 2008.
Further the Board infers from the materials before it, particularly correlation of the date of diagnosis of dementia appearing in the report of 22 February 2019, and the date of registration of the Instrument, it is probable that the donor’s symptoms of dementia emerged in around 2014, such that BMX began to exercise her powers under the enduring phase of the Instrument.
Whether the donee is fulfilling her duties to the donor
By virtue of the Instrument being a general Enduring Power of Attorney, it empowered the donees to do any act which the donor could otherwise lawfully do herself. The specific powers contained in subsection (2A) of section 31 of the POA Act were adopted also. Those powers are extensive and to the extent that the donor’s real estate was sold and multiple transactions made on her bank account, the transactions were all empowered. The real issue arising in this case is whether or not in selling the real estate and transacting the bank account, the donee acted in breach of trust.
To support her contention that the real estate was sold in breach of trust, MWC relies on the sale being to a relative of the donee at a price which she says was below proper market value. The difficulty with the contention is that the sale of the property was 15 May 2017, but the comparative market sales data that she relies upon[3] relates to sales in 2018. It is widely known that the real estate market in Hobart has rapidly increased in the last several years and the Board finds there is no merit in the submissions made by MWC.
[3] See page 2 of submission
In addition, the mere fact that the property was sold to the donor’s grandson by the donee, does not permit an inference or conclusion that there has been a breach of fiduciary duty on the part of the donee. This is because it is not uncommon for family members to sell property to other family members. Indeed in this instance, the Board received information from the donee and separately from the donor (the facts of which were not challenged by MWC), that in years prior to the Instrument being created, the donor gave $10,000 to another grandson to assist him to buy a home. This is also consistent with amounts totalling $10,000 deposited into a CBA account operated for the donor that are noted as ‘House deposits’ for the donor’s two remaining grandsons.
MWC also raises concerns regarding the manner of bank account management and the use of the donor’s funds. The donee was unable to provide receipts and other evidence of purchases since operating the EPA. She offered the explanation that these were lost in flooding of the family home in May 2018 and since then she has operated on the basis of showing receipts to the donor but not keeping them. Banking transactions covering the relevant period indicated a pattern of routine cash withdrawals. It was argued by the donee that this was the habit of the donor prior to the application of the EPA and continued by the donee to respect the donor’s wishes. Profit and Loss Statements and Balance Sheets for the periods July 2014-June 2015, July 2015-June 2016, July 2016-June 2017, July 2017-June 2018, July 2018–December 2018 compiled by an accountant were provided to the Board. These statements provided a full accounting for the donor’s funds and a picture of expenditure to the benefit of the donor. On this basis, the Board is not satisfied that there has been breach of fiduciary duty around the banking transactions or the application of those funds.
Conclusion and determination of the Board
Although extensive material was filed by MWC in an endeavour to persuade the Board that the donee of the Instrument had acted contrary to her duties to the donor, much of the information was irrelevant or motivated by misconceived grievance about the breakdown of MWC’s relationship with the donor, the donees and the consequences of this.
The Board was not persuaded that there was any compelling evidence that the donee of the Instrument had failed to honour her duties[4]. Further although the accounting in respect of all of the donor’s income and capital could have been clearer, the Board is not satisfied that the standard of accounting is so unacceptable that it warrants the Board exercising any powers upon the review application[S5] .
[4] Briginshaw v Briginshaw, [1938] HCA 34; (1938) 60 CLR 336
[S1]Please check date
[S2]
[S3]
[RK4]
[S5]Should we add any additional reasoning here? For example; the absence of evidence of any harm or detriment to the donor?
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