QZH

[2023] NSWCATGD 21

NSW Civil and Administrative Tribunal

New South Wales

Medium Neutral Citation:

QZH [2023] NSWCATGD 21

Hearing dates:

4 October 2023

Date of orders:

25 October 2023

Decision date:

25 October 2023

Jurisdiction:

Guardianship Division

Before:

A R Boxall, Senior Member (Legal)
Dr I L Beale, Senior Member (Professional)
F N Given, General Member (Community)

Decision:

001: Financial Management Application

1. The estate of QZH is subject to management under the NSW Trustee and Guardian Act 2009 (NSW).

2. The management of the estate of QZH is committed to the NSW Trustee and Guardian.

002: Guardianship Application

1. A guardianship order is made for QZH.

2. The Public Guardian is appointed as the guardian.

3. This is a continuing guardianship order for a period of 12 months from 25 October 2023.

4. This is a limited guardianship order giving the guardian(s) custody of QZH to the extent necessary to carry out the functions below.

FUNCTIONS:

5. The guardian has the following functions:

a) Accommodation

To decide where QZH may reside.

b) Health care

To decide what health care QZH may receive.

c) Medical/Dental consent

To make substitute decisions about proposed minor or major medical or dental treatment, where QZH is not capable of giving a valid consent.

d) Services

To make decisions about services to be provided to QZH.

CONDITION:

6. The condition of this order is:

a) Standard Condition

In exercising this role the guardian shall take all reasonable steps to bring QZH to an understanding of the issues and to obtain and consider his views before making significant decisions.

Catchwords:

GUARDIANSHIP – application for a guardianship order – whether a guardianship order should be made – subject person diagnosed with dementia – existing appointment of enduring guardianship not working in the subject person’s best interests – need for a guardian to make decisions about accommodation, services, health care, and consent to medical and dental treatment – proposed guardians not suitable to be appointed – Public Guardian appointed – order made

FINANCIAL MANAGEMENT – application for a financial management order – subject person incapable of managing their own affairs – existing appointment of enduring attorney – attorney obtained financial benefit with no authority – need for the appointment of an independent financial manager – NSW Trustee and Guardian appointed – order made

Legislation Cited:

Civil and Administrative Tribunal Act 2013 (NSW), s 36

Guardianship Act 1987 (NSW), ss 3(1)-(2), 4, 14, 14(2), 25M

Powers of Attorney Act 2003 (NSW), s 12

Powers of Attorney Regulations 2016 (NSW)

Cases Cited:

IF v IG [2004] NSWADTAP 3

Texts Cited:

None cited.

Category:

Principal judgment

Parties:

001: Financial Management Application

QZH (the person)
KAH (applicant)
OYH (carer)
NSW Trustee and Guardian
UBH (spouse)

002: Guardianship Application

QZH (the person)
KAH (applicant)
OYH (carer)
Public Guardian
UBH (spouse)

Representation:

Nil.

File Number(s):

NCAT 2023/00155910

Publication restriction:

Decisions of the Guardianship Division of the Civil and Administrative Tribunal have been anonymised to remove any information that may identify any person involved in the Tribunal’s proceedings: Civil and Administrative Tribunal Act 2013 (NSW), s 65.

REASONS FOR DECISION

GUARDIANSHIP APPLICATION
FINANCIAL MANAGEMENT APPLICATION

Background

1. QZH is 89 years old and is of Greek heritage. He lives with his spouse, UBH, in a house in southwest Sydney owned by the Applicant, who is one of the couple’s two sons. They share the house with OYH, their other son, while his own property in west Sydney is being rebuilt.

2. On 20 November 2020, QZH executed an enduring power of attorney (the EPA) appointing OYH as his enduring attorney, and his grandsons, Mr Z and Mr Y, as substitute attorneys.

3. On 20 November 2020, QZH also executed an enduring guardianship appointment (the EGA) appointing OYH as his enduring guardian, to make decisions about accommodation, services, health care and medical and dental treatment, and his grandsons, Mr Z and Mr Y, as substitute enduring guardians.

4. On 9 May 2023, the Tribunal received a financial management application for QZH from KAH. On that day, it also received from him a financial management application for UBH.

5. On 23 June 2023, the Tribunal received a guardianship application for QZH from KAH. On that day, it also received from him a guardianship application for UBH.

6. The purpose of today’s hearing is to decide both applications for each of QZH and UBH. These are being dealt with in a single consolidated hearing because of the issues common to both sets of applications.

The hearing

7. At the end of these Reasons for Decision are lists of the parties to the application and the witnesses who attended the hearing. [Appendix removed for publication.]

8. Ms X acted as Greek interpreter.

9. QZH was in hospital at the time of the hearing, and by common consensus of both KAH and OYH was too unwell to participate in it and, in any event, too cognitively impaired to do so. Accordingly, the Tribunal decided to proceed with the hearing in his absence despite this, because of the potential seriousness of certain of the issues raised by the applications.

Does KAH have standing to bring the applications?

10. A person has standing to bring an application for a guardianship order if he or she is:

1. The person who is the subject of the application

2. The Public Guardian or

3. Any other person who, in the opinion of the Tribunal, has a genuine concern for the welfare of the person.

11. A person has standing to bring a financial management application if he or she is:

1. the person who is the subject of the application

2. the NSW Trustee and Guardian or

3. any other person who, in the opinion of the Tribunal, has a genuine concern for the welfare of the person.

12. The Tribunal found that KAH has standing to make the application for a guardianship order and a financial management order because, as QZH’s son, he can reasonably be considered to have the necessary concern.

Applicable general principles

13. Section 4 of the Guardianship Act 1987 (NSW) (the Act) provides as follows:

4 General principles

It is the duty of everyone exercising functions under this Act with respect to persons who have disabilities to observe the following principles:

(a)    the welfare and interests of such persons should be given paramount consideration,

(b)    the freedom of decision and freedom of action of such persons should be restricted as little as possible,

(c)    such persons should be encouraged, as far as possible, to live a normal life in the community,

(d)    the views of such persons in relation to the exercise of those functions should be taken into consideration,

(e)    the importance of preserving the family relationships and the cultural and linguistic environments of such persons should be recognised,

(f)    such persons should be encouraged, as far as possible, to be self-reliant in matters relating to their personal, domestic and financial affairs,

(g)    such persons should be protected from neglect, abuse and exploitation,

(h)    the community should be encouraged to apply and promote these principles.

14. Section 36 of the Civil and Administrative Tribunal Act 2013 (NSW) provides as follows:

36 Guiding principle to be applied to practice and procedure

… The guiding principle for this Act and the procedural rules, in their application to proceedings in the Tribunal, is to facilitate the just, quick and cheap resolution of the real issues in the proceedings.

15. These two sets of principles together inform the approach taken by the Tribunal in this hearing.

GUARDIANSHIP APPLICATION

What did the Tribunal have to decide?

16. The questions which had to be decided by the Tribunal were:

• Is QZH someone for whom the Tribunal could make an order because he has a disability which renders him totally or partially incapable of managing his person?

• Should the Tribunal make a guardianship order and if so, what order should be made?

• Who should be the guardian?

• How long should the order last?

Is QZH someone for whom the Tribunal could make an order because he has a disability which renders him totally or partially incapable of managing his person?

17. Section 14 of the Act provides that the Tribunal may make a guardianship order for a person if it is satisfied that he or she is “a person in need of a guardian”. A person in need of a guardian is “a person who because of a disability is totally or partially incapable of managing his or her person”; the Act, s 3(1). A person with a disability is a person who is:

1. intellectually, physically, psychologically or sensorily disabled

2. of advanced age,

3. a mentally ill person within the meaning of the Mental Health Act 2007 (NSW); or

4. otherwise disabled;

and by virtue of that fact is restricted in one or more major life activities to such an extent that he or she requires supervision or social habilitation: the Act, s 3(2).

18. Accompanying the application was a medical report dated 14 August 2023 concerning QZH, issued by Dr W, of southwest Sydney. Dr W states that QZH:

1. Has been a patient of the practice for over 20 years, and a patient of Dr W for over 18 years;

2. Has been diagnosed with dementia since 2019;

3. Will continue to deteriorate cognitively in the short to medium term, and will require an increased level of care as a consequence; and

4. Is unable as a result of that condition to manage his financial affairs.

19. Both KAH and OYH agreed that QZH has a cognitive impairment, and that this prevents him making informed decisions about his care needs.

20. The Tribunal noted that the doctor’s letter was limited in its terms to financial decision-making, but in view of the context in which the letter was issued, namely a financial management application, the Tribunal read the letter as extending to QZH’s decision-making capacity more generally. This reading was supported by the views expressed by the couple’s sons.

21. The Tribunal is satisfied therefore that QZH has a disability, namely dementia, which renders him totally or partially incapable of managing his person. Accordingly, he is a person for whom the Tribunal could make a guardianship order.

Should the Tribunal make a guardianship order and what order should be made?

22. The Tribunal must consider all of the following matters set out in s 14(2) of the Act before exercising its discretion to make a guardianship order:

1. the views (if any) of:

1. the person, and

2. the person's spouse, and

3. the person's carer and

2. the importance of preserving the person's existing family relationships, and

3. the importance of preserving the person's particular cultural and linguistic environments, and

4. the practicability of services being provided to the person without the need for the making of such an order.

23. These matters have no hierarchy or weighting and each is a mandatory consideration. However, the Tribunal must undertake a balancing exercise for its consideration of the matters in s 14(2) of the Act. When undertaking this task, the Tribunal may be guided by the principles that are set out in s 4 of the Act (see IF v IG [2004] NSWADTAP 3).

24. The Applicant’s concerns about decision making for his parents are as follows:

1. Although OYH is appointed as their enduring guardian, he in fact does little to assist them in making appropriate care and lifestyle decisions, with the result that they live in sub-optimal conditions.

2. They have been living for some time in the house in southwest Sydney, pending the completion of OYH’s building work in west Sydney. The southwest Sydney house is cluttered and squalid, in part at least because OYH is storing there many of his possessions while the works proceed. A particular concern is that the couple sleep on mattresses on the floor.

3. There is little prospect of the works being completed in short order.

4. Neither parent receives support from service providers, and are left to shift for themselves despite their disabilities.

5. QZH’s recent hospitalisation raises concerns as to the health care that he receives, while UBH’s practical ability to manage her medical needs without further assistance is questionable. The issue is a difficult one, since OYH is unwilling to share information about the couple’s medical and other care needs.

25. OYH recognises the sub-optimal nature of QZH and UBH’s current living arrangements, while remaining confident that when his building works are completed they will be able to move into a new accommodation area in the west Sydney house, built to meet their requirements. He suggested that only about another $100,000 of work needed to be done to reach completion but was unable to provide an estimate of when this will occur. He was adamant that he would never contemplate his parents moving to an aged care facility and would always care for them at home. The mattresses were on the floor in order to minimise the risk of falls. He agreed that his father received no service support because he would not accept it. He said that his parents attended the doctor – Dr W – regularly, but was unable or unwilling to provide a considered or detailed account of their health management arrangements or medical needs.

26. UBH was adamant that:

1. she was happy where she was, and did not want to move;

2. she did not need any help or support around the house;

3. she did not know what medication she was taking or what its effects were, but she would know if it changed; and

4. she thought that OYH was looking after the couple well.

27. Several things emerged from all this in the Tribunal’s view:

1. The first was that OYH’s primary focus, so far as his parents’ care is concerned, was on moving them to his new house when this is completed, in the expectation that this move will resolve any issues about their care and accommodation;

2. In the meantime, however, he was entirely accepting of their living in what he recognised to be sub-optimal physical conditions with little apparent idea as to how long these temporary arrangements were likely to persist;

3. He was moreover closed to considering alternative accommodation options, such as a retirement village or aged care facility, that even on a temporary basis might offer the couple better care and accommodation pending completion of the works;

4. He showed little appreciation of, or engagement with, their health care and medical needs or of the possibility of their being supported by service providers.

5. He could provide no convincing account of their medical situations.

28. The Tribunal was satisfied that there were genuine concerns as to the quality of decision making concerning QZH’s accommodation and care, and that the existence of the EGA appointing OYH as enduring guardian did not materially contribute to the establishment of a regime for the making of consistent and focussed decisions for QZH’s accommodation and care, because of the concerns identified in [27] above. It decided that a guardianship order should be made. The order should cover decisions about accommodation, services, health care and medical and dental treatment.

Who should be the guardian?

29. The Applicant proposed himself, with the assistance of his wife, as guardian for QZH. The Tribunal was not satisfied that either he or his wife was an appropriate candidate for appointment, since the negative dynamic between the Applicant and his brother raised a real concern that decision making by the Applicant (or indeed his wife) would be influenced by the animosity between the siblings, with the risk of further disruption in family relationships for both QZH and UBH.

30. In the absence of any other private candidate for appointment as guardian, the Tribunal appointed the Public Guardian.

How long should the order last?

31. An initial guardianship order can be made for a period of up to one year from the date on which it was made.

32. The Tribunal decided to make an order for 12 months in order to allow decisions to be made for a reasonable period on a consistent basis.

33. The effect of the order is to suspend the operation of the EGA.

FINANCIAL MANAGEMENT APPLICATION

What did the Tribunal have to decide?

34. The questions to be considered by the Tribunal are:

• Is QZH incapable of managing his affairs?

• Is there a need for another person to manage QZH’s affairs and is it in his best interests for a financial management order to be made?

• If so, who should be appointed financial manager?

Is QZH incapable of managing his affairs?

35. The evidence referred to above is relevant here. Dr W’s letter is clearly directly on point, and the Tribunal was satisfied from it that QZH is incapable, partially at least, of managing his affairs.

36. Again, the Tribunal noted that both KAH and OYH agreed that QZH has a cognitive impairment that adversely affects his ability to make informed decisions about his financial affairs.

37. The Tribunal was satisfied therefore that QZH is in part at least incapable of managing his affairs.

Is there a need for a financial management order?

38. It was common ground between KAH and OYH that:

1. until September 2021, the couple’s financial affairs were primarily managed by QZH;

2. since then, OYH has been the primary (if not sole) manager of their affairs;

3. he has done so variously as enduring attorney appointed by his parents under respectively the EPA and a corresponding instrument granted by UBH and under informal arrangements;

4. in 2018, the couple together co-owned the following assets:

1. cash deposits of between $250,000 and $350,000;

2. a house in southwest Sydney, with a value of about $1.4 million; and

3. taxi plates with a value of about $300,000;

5. each of them had an interest in real property in Greece, of indeterminate value; and

6. the southwest Sydney property was sold in December 2019 for a price of $1.419 million.

39. Various bank records have been provided to the Tribunal. These indicate that:

1. the couple have a Pensioner Security account with an Australian bank;

2. the balance of that account on 31 May 2020 was $25,000;

3. in March 2021, it reached a credit balance of slightly over $820,000;

4. since then, the balance has declined steadily, and as at 11 August 2023, stood at $321,134.85;

5. the couple also have a passbook account with the bank; the balance on this in November 2020 (shortly after the execution of the EPA) was $817,192.50, and as at 31 July 2023, was $426,135.48; some at least of the withdrawals from this account correspond to credits to the couple’s Pensioner Security account.

40. What is apparent from the information provided is that a couple with a net worth in 2019 of about $2,000,000 have sold the real estate that comprised the bulk of that amount, of which they were entitled to net proceeds of over $1.3 million. Those cash proceeds appear to have been deposited in various bank accounts. Their total cash balance, according to the evidence provided, is in the order of $750,000. Their apparent net worth has thus dropped by about $1,250,000 since 2019.

41. OYH said that the money has primarily been used to fund the building works at his property in west Sydney, where the couple will move (along with him) on completion, where they will be cared for by him. The arrangement for his parents to assist him with the building works is one that he agreed with his father, and that his parents approved because it offered them long-term accommodation in a caring family environment. Before his father’s functional decline, QZH had arranged for the relevant financial transactions, and since the EPA was activated, he (OYH) had continued with his father’s practice, as the bank records indicate. The arrangements were, he said, a perfectly normal family arrangement of the kind that his brother had previously benefited from in order himself to purchase a property.

42. UBH agreed that she and her husband had provided a large amount of money – she couldn’t say precisely how much, but she agreed that it was very large – to her son in order to help him rebuild his house. When the Tribunal asked her why this was done, she answered that it was because he is her son.

40. KAH emphasised the risk of exploitation of his parents, and their vulnerability to financial abuse.

41. The Tribunal accepts that it is neither unusual nor inappropriate for parents who wish to do so to assist their adult children financially in acquiring or improving real property. In the present case, however, the recipient of the couple’s support is not only their son but also their attorney, appointed under the EPA and the corresponding instrument granted by UBH. Neither the EPA nor the corresponding instrument contains any provision that expressly provides for the attorney to provide benefits to himself from the estate of the grantor of the instrument. Indeed, the optional provision contained in the form of Enduring Power of Attorney prescribed under the Powers of Attorney Regulations 2016 (NSW) that confers such an authority has not been included in the EPA or the corresponding instrument. This has two consequences:

1. First, one must infer that it was not the intention of either QZH or UBH that the EPA be used as a device for making their money available to KAH; and

2. Secondly, neither instrument authorised KAH to confer such a benefit on himself in reliance on his authority as enduring attorney: Powers of Attorney Act 2003 (NSW) [1] , s 12.

It would thus appear that, to the extent that in purported reliance on his authority as their respective enduring attorney OYH has given financial assistance to himself from his parents’ estate in connection with his building works, he has acted outside his authority under the relevant instrument. The Tribunal refrains from making any finding as to whether (and if so to what extent) he purportedly acted as attorney, because the evidence was insufficiently detailed to allow it to do so.

1. “A prescribed power of attorney does not authorise an attorney to execute an assurance or other document, or to do any other act, as a result of which a benefit would be conferred on the attorney unless the instrument creating the power expressly authorises the conferral of the benefit”: Powers of Attorney Act 2003 (NSW), s 12(1).

45. Nonetheless, for two reasons the Tribunal was satisfied that:

1. there is a need to appoint someone to manage QZH’s affairs; and

2. it is in the best interests of QZH that a financial management order be made.

46. These reasons are that:

1. there is a credible possibility, to put it at its lowest, that OYH has been acting outside his authority under the relevant enduring powers of attorney in order to confer a financial benefit on himself; and

2. the financial position of QZH and UBH is put at risk by this practice. If the transactions in question were gifts, then their assets have been depleted for no apparent benefit to themselves other than an assumption that they will eventually move to their son’s house once it is completed. If the transactions were loans there is no evidence to suggest that they have any security or other interest in the west Sydney property out of which to recoup their debt, if OYH is unwilling or unable to repay it nor is there even any clear acknowledgement of indebtedness that they would be able to produce in order to claim repayment.

Who should be appointed as financial manager?

47. In appointing a financial manager, as in making all other orders under the Act, the Tribunal must act with the interests of the person concerned as the paramount consideration and in accordance with the other principles set out in s 4 of the Act.

48. Section 25M of the Act provides that, if the Tribunal makes a financial management order, it may appoint a suitable person to manage the person’s estate or may commit the management of the estate to the NSW Trustee and Guardian.

49. Again, because of the hostility between KAH and OYH, the Tribunal considered that QZH’s interests were better served by the appointment of an independent financial manager. Any attempt by the Applicant or his wife to regularise the concerns outlined above as to the financial arrangements between QZH and OYH would in the Tribunal’s assessment become inextricably bound up with the brothers’ rivalry, to the overall detriment of QZH and UBH, both financially and in terms of their familial relationships.

50. Hence, the Tribunal was satisfied that the estate of QZH should be committed to the NSW Trustee and Guardian.

51. The effect of this order is to suspend the EPA.

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Endnote

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.

Registrar

Decision last updated: 24 May 2024