QNQ (Administration)
[2012] TASGAB 28
•30 August 2012
GUARDIANSHIP AND ADMINISTRATION BOARD
BURNIE
QNQ on the application of CMQ for an Administration Order
Neutral citation: QNQ (Administration) [2012] TASGAB 28
REASONS FOR DECISION
Leon Peck (Chair)
Mary Davies
Grant Kingston
Date of hearing: 30 August 2012
Administration – disability and incapacity - proposed represented person as tenant in common with brother and sister-in-law – other tenants in Family Law proceedings – need to be represented in Family Law proceedings – whether another family member is eligible for appointment as administrator
Guardianship and Administration Act, 1995 s.3, 51, 54
Background:
QNQ is a 34 year old currently residing with his mother on a property at North West Tasmania. QNQ has a sister, MQ and two brothers, HQ and EQ. QNQ owns a one third share in a property at North West Tasmania. The title is held as tenants in common with the other two shares were held by QNQ's brother EQ and EQ's former partner TQ. The property was purchased in 1999 for $55,000. QNQ contributed $5,500 towards the purchase price. EQ reported that the property has a current valuation of $320,000. It was reported that QNQ had not been required to contribute to mortgage repayments.
Following the separation of EQ and TQ, the property settlement required an adjustment in the title. During legal proceedings, a Federal Magistrate has ordered that QNQ be joined as a respondent to the application, due to his interest in the property. Also as a result of the family law proceedings consent orders were made which included that TQ was to be discharged from the mortgage on the property which was held in the name of QNQ, EQ and TQ and that TQ would then relinquish her share in the property to the benefit of EQ.
CMQ lodged an application, dated 13th July 2012, for the appointment of an administrator. CMQ proposed that she be appointed as the Administrator. She stated the reasons for the application to be: “For QNQs financial needs regarding property settlement and bank loan”
The hearing was conducted at the Burnie Municipal Council Chambers on the 30th August 2012.
In attendance were:
QNQ- Proposed Represented Person
CMQ – Applicant
EQ – Brother
Ms Kathryn Greinig – Office of Public Trustee
When introducing the hearing the Board explained that it had to be established that the proposed represented person has a disability that makes him incapable of making reasonable judgements and decisions in relation to the management of his estate (administration). In addition the Board had to be satisfied that there was the need for an administration order and finally had to be satisfied of the appropriateness and suitability of the proposed administrator.
Is QNQ a Person with a Disability?
A health care professional report from Dr Keith McArthur dated 13th July 2012 stated QNQ had an intellectual disability which had been evident since birth. Dr McArthur considered the disability to be static with a prognosis that it will not change.
In the absence of any evidence or reports to the contrary, the Board concluded that the proposed represented person had a disability, as interpreted in Part 1, Section 3(1) of the Guardianship and Administration Act 1995 (the Act).
Does QNQ Lack Capacity to Make Reasonable Judgments?
Dr McArthur in his health care professional report stated that it was his understanding that the application had been lodged because of the need for legal documents to be signed and the inherent need for QNQ to have an understanding of the documentation and the implications of signing. In response to the questions relating to susceptibility to influence Dr McArthur responded;
“If he trusts the person he would comply with their requests without being able to judge....”
“... would follow instructions without being able to make own judgement”
In response to the question relating to the appreciation of the nature and extent of his property Dr McArthur stated:
“no appreciable understanding”
Dr McArthur also considered that QNQ lacked the ability to manage day to day financial requirements and certainly the ability to make major financial decisions such as the sale of a major asset.
Neither the applicant nor EQ offered to the Board any evidence that would dispute the conclusions of Dr McArthur.
The Board therefore concluded that QNQ lacked the capacity to make reasonable judgements in respect of matters relating to his person or circumstances as per Part 4, Section 21(1) of the Act.
Is QNQ in Need of an Administrator?
The Board acknowledged that CMQ had cared for and managed QNQ's finances throughout his life. The Board concluded that she had performed this role with honesty and integrity. However the Board was concerned by the following factors: the fact that money had been borrowed from QNQ, a significant amount of money appeared to have spent on the likes of motor bikes and motor mowers, there was an apparent lack of structure in the management, budgeting and expenditure of his pension and minimal savings had been accrued.
The Board considered that the family, and EQ in particular, had been very generous with QNQ's ten percent contribution to the purchase of the property resulting in a one-third ownership. In addition there had not been a demand on QNQ's finances to meet mortgage repayments.
The Board also acknowledged that the family were a close unit, however times had been difficult with QNQ's father being admitted into an aged care facility as the result of dementia. The stresses were compounded with the split between EQ and his partner and the associated Federal Magistrates Court proceedings and property settlement.
The Court proceedings included a settlement of entitlements to the property at North West Tasmania. A property of some 20.23 hectares with a building of 70 square metres and a valuation in June 2010 of land at $155,000 and a capital value of $205,000.
In correspondence dated 24th August 2012 Jill Prentice from Walsh Day James Mihal, Barristers and Solicitors, advised that she acted on behalf of EQ and QNQ in relation to the Court proceedings between both brothers as Respondents to an Application made to the Federal Magistrates Court by EQ's former partner, TQ. The three individuals were the owners of the property as tenants in common.
An Order was made by the Court on 17th May 2012.
“... providing that TQ would transfer all her interest in the property at North West Tasmania to EQ”
“It further ordered that EQ Pay $47,500 to TQ and that both EQ and QNQ provide her with a Discharge of the Mortgage then on the property”
Ms Prentice continued:
“.... difficulties have arisen in obtaining that Discharge and refinancing because of QNQ's incapacity to understand Mortgage documents”
“The making of the Federal Magistrates Court Orders protects QNQ's on going interest in his property and he is obliged under these Orders to ensure that TQ's interest is discharged and her liability under the joint Mortgage is also discharged. It is therefore in both my clients interest to put in place a new Mortgage (if necessary) to ensure that the Title is in their joint names, as tenants in common in a two third/one third situation”.
The day-to-day management of QNQ's money required analysis, Court proceedings were at a standstill until an administrator was appointed and there was the need for an objective assessment of the appropriateness of QNQ's current investment. The Board concluded that there was the need for an administrator.
Who Should be Appointed as Administrator?
The Board acknowledges that CMQ had been managing QNQ's money all of his life. There is little doubt that she had made decisions that she considered would benefit QNQ.
However the Board were concerned at the lack of his independence in relation to the day to day management of his finances. CMQ stated that they just 'pooled' their money. The Board acknowledged that QNQ's financial interest in the property had been a good investment and the family, EQ in particular, had been most generous in his treatment of QNQ with the ten percent investment providing him with a one third equity in the property. However the Board considered that CMQ and EQ were too close to ensure that an objective decision could be made in relation to what would now be in QNQ's best interests in relation to his ongoing financial interest in the property.
A Guardianship and Administration Board Investigator contacted MQ on the 27th August 2012 to discuss her mother's application. During the discussion MQ disclosed that she was concerned for her mother and felt that an independent appointment may take some pressure off her. MQ was also concerned with her mother's capacity to manage any investments between QNQ and EQ. She stated that her mother makes decisions without thinking things through, being reactive with her decision making, rather than looking at things as a long term proposition.
The Guardianship and Administration Board Investigator also spoke to HQ on the 20th August 2012. HQ felt that his mother had QNQ's day to day finances under control but considered QNQ's best interest would be better served with his assets in a trust, managed independently, or at least subject to an independent assessment.
Based on the evidence and the information available the Board considered an independent appointment to be in QNQ's best interests and therefore appropriate. The Board confined the subsequent Order to 12 months. This should be sufficient time to address the Federal Court requirement and address the 'pooling of funds' arrangement that currently applies to QNQ's Centrelink entitlements and address the appropriateness of the continuation of QNQ's financial interest in the North West Tasmania property. With these issues addressed a less restrictive option may be available and it may be possible to appoint an alternative administrator.
CONCLUSION
After hearing an application by CMQ for an administration order in respect of QNQ (hereinafter called the 'represented person')
The Board was satisfied that the represented person
is a person with a disability, and
is unable by reason of the disability to make reasonable judgements in respect of his estate;
and
is in need of an administrator
THE BOARD ORDERS
That The Public Trustee be appointed as administrator of the estate of the represented person.
That the powers and duties of the administrator be those conferred by Division 4 of Part 7 of the Guardianship and Administration Act 1995.
That the order remains in effect until 29 August 2013.
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Chairman
Leon Peck
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