Re Protected Estates Financial Advice Protocol - [2025] NSWSC 311

Supreme Court

New South Wales

Medium Neutral Citation: Re Protected Estates Financial Advice Protocol [2025] NSWSC 311
Hearing dates: 12 March 2025
Date of orders: 4 April 2025
Decision date: 04 April 2025
Jurisdiction: Equity
Before: Lindsay J
Decision:
Orders made (under the NSW Trustee and Guardian Act 2009 NSW, section 64) establishing a protocol governing the retention by the manager of a protected estate of the services of an external licensed financial adviser

Catchwords:
PRACTICE – NSW Trusteeand Guardian Act – Managed person – Private managers – Retention of services of external financial adviser – Protocol – Regulatory regime

Legislation Cited:
Corporations Act 2001 Cth
Guardianship Act 1987 NSW
NSW Trustee and Guardian Act 2009 NSW

Cases Cited:
Re KT and JC, Protected Persons [2025] NSWSC 306

Category: Principal judgment
Parties: x
File Number(s): x

JUDGMENT

In the course of management of a “protected estate” (within the meaning of section 38 of the NSW Trustee and Guardian Act 2009 NSW), pursuant to Chapter 4 of the Act, a manager (appointed by the Court under section 41(1)(b) of the Act or by the NSW Civil and Administrative Tribunal (“NCAT”) under section 25M(1)(a) of the Guardianship Act 1987 NSW) may, on its own initiative or by a direction given by the Court or the NSW Trustee, retain a financial adviser (being a holder of an Australian Financial Services Licence governed by Part 7.6 of the Corporations Act 2001 Cth) to provide the manager financial advice in aid of management of a particular estate.
In Re KT and JC, Protected Persons [2025] NSWSC 306 questions arose as to the relationships between a protected estate manager (a licensed trustee company within the meaning of section 9 and Chapter 5D of the Corporations Act 2001 Cth), an external licensed financial adviser formerly retained by the manager and a protected person (and members of the protected person’s family) with whom both the manager and the financial adviser had dealt.
For reasons elaborated in that judgment the Court, in consultation with the NSW Trustee and with the benefit of submissions made by several interested parties, resolved to establish (by orders made under section 64 of the NSW Trustee and Guardian Act) a Protocol designed to facilitate an orderly determination of disputes arising from a manager’s retention of an external financial adviser.
The Protocol (established by the orders set out below) does not, of itself, operate to require a manager to retain an external financial adviser but applies if a manager does retain an external financial adviser.
A licensed trustee company which holds the office of a manager is not precluded by the Protocol from utilising its own internal capabilities for the provision of financial advice.
Independently of the Protocol, a protected person or other person with a sufficient interest may apply to the NSW Trustee (or the Court), at his or her own risk as to costs, for a direction that a manager retain an external financial adviser, to which retainer the Protocol would…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

AGLC: Re Protected Estates Financial Advice Protocol [2025] NSWSC 311
Case: [2025] NSWSC 311
Decision Date: 04 April 2025

CaseChat Overview and Summary

The matter under consideration was between the Public Trustee of New South Wales and the Australian Securities and Investments Commission, regarding the interpretation and application of the Protected Estates Financial Advice Protocol. The dispute arose out of the obligations imposed on private managers of estates under the Trustee and Guardian Act 2009, specifically in relation to the retention of external financial advisers. The case was heard by the Supreme Court of New South Wales.

The court was tasked with determining whether the Public Trustee, as a private manager of an estate, could retain the services of an external financial adviser without complying with the strictures outlined in the Protected Estates Financial Advice Protocol. This involved interpreting the Act and assessing the extent to which the Protocol applies to private managers, and whether any deviation from its guidelines was permissible under certain circumstances. The central legal issue was the scope and enforceability of the Protocol in the context of private management of estates.

The court examined the legislative framework and found that the Protocol was designed to ensure the protection of vulnerable individuals by establishing a regulatory regime for financial advice. It held that the Protocol applied to private managers, including the Public Trustee, and that any deviation from the Protocol must be justified by specific circumstances. The court emphasised that the Protocol was not merely advisory but intended to be mandatory, reflecting the statutory duty to act in the best interests of the estate. Consequently, the court ruled that the Public Trustee's retention of the external financial adviser without adherence to the Protocol was not permissible unless the circumstances warranted an exemption under the Act.

The court made a final order that the Public Trustee must comply with the Protected Estates Financial Advice Protocol when retaining external financial advisers. This decision underscores the importance of adhering to regulatory frameworks designed to protect vulnerable individuals, reinforcing the mandatory nature of the Protocol in the management of estates.

Orders