SFX

[2018] NSWCATGD 15

NSW Civil and Administrative Tribunal

New South Wales

• Amendment notes

Medium Neutral Citation:	SFX [2018] NSWCATGD 15
Hearing dates:	On the papers
Date of orders:	02 August 2018
Decision date:	02 August 2018
Jurisdiction:	Guardianship Division
Before:	C P Fougere, Principal Member
Decision:	The financial management order made in relation to SFX made on 26 September 2017 is set aside.
Catchwords:	SET ASIDE – Application to set aside financial management order (Regulation 9) – whether absence resulted in case not being adequately put – exercise of discretion – failure to take reasonable steps to ascertain views – real likelihood of injustice
Legislation Cited:	Civil and Administrative Tribunal Act 2013 (NSW), s 41 Civil and Administrative Tribunal Regulation 2013 (NSW), cls 9, 9(1)(b), 9(3), 13(4)(a) Civil and Administrative Tribunal Rules 2014 (NSW) Consumer Claims Act 1998 (NSW) Guardianship Act 1987 (NSW), ss 4, 4(b)-(d), 4(f) NSW Trustee and Guardian Act 2009 (NSW)
Cases Cited:	Coffey v Coffey (No. 2) [2015] NSWSC 338 H v H [2015] NSWSC 837 Hammond v Ozzy’s Cheapest Cars Pty Ltd t/as Ozzy Car Sales [2015] NSWCATAP 65 Murphy v Doman (2003) 58 NSWLR 51 Scott v Scott [2012] NSWSC 1541
Texts Cited:	Nil
Category:	Principal judgment
Parties:	003: Set aside/Vary Application for Finalising Order(s)   SFX (the person, applicant) OZS (appointed financial manager) UAX (appointed financial manager) NSW Trustee and Guardian
Representation:	Nil
File Number(s):	NCAT 2013/00391489
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 (s 65, Civil and Administrative Tribunal Act 2013 (NSW)).

REASONS FOR DECISION

Background

1. SFX seeks to have set aside an order made on 26 September 2017 that her estate is subject to management under the NSW Trustee and Guardian Act 2009 (NSW) and that her children, OZS and UAX, are appointed jointly and severally as her financial managers.

2. The application is made under cl 9 of the Civil and Administrative Tribunal Regulation 2013 (NSW) (the Regulation). SFX seeks to have the Tribunal’s orders set aside on the basis that the order was made in her absence and that her absence meant that her case was not adequately put to the Tribunal.

3. SFX claims that she was unaware of the proceedings on 26 September 2017 as she had not received notice of the hearing date or time.

4. The set aside application was filed on 4 November 2017 which is outside the seven day time limit provided for in cl 9(3) of the Regulation.

5. At a directions hearing conducted on 25 January 2018 in which SFX and her two children participated, the Tribunal granted under s 41 of the Civil and Administrative Tribunal Act 2013 (NSW) (the Act) an extension of time for SFX to lodge the set aside application.

6. The Tribunal also directed the parties to file submissions in respect of the application.

7. In accordance with that direction, SFX provided written submissions letters from family members and a friend to support her application.

8. OZS and UAX provided written submissions opposing the application as well as other material including copies of written correspondence and what appear to be copies of text messages between them and SFX. OZS also submitted a statement from a friend in support of her application to oppose an order setting aside or varying the financial management order.

9. The NSW Trustee and Guardian provided a written report but made no comment or submission concerning SFX’s application to have the financial management application set aside.

10. The Tribunal provided each of the parties with copies of all of the written material.

Reasons for Decision on 26 September 2017

11. The written reasons in relation to the decision made on 26 September 2017 confirm that the only people who participated in the hearing were OZS and UAX.

12. The Tribunal makes reference to SFX’s absence from the hearing at [4] of the Reasons as follows:

[OZS] and [UAX] gave evidence that their mother is quite aware of the hearing today and, in their view, it appears that she has chosen not to attend. In light of that evidence, the Tribunal determined that it is appropriate to proceed with this application, in the best interests of [SFX].

13. The only evidence before the Tribunal was the oral evidence provided by OZS and UAX and a written report dated 31 May 2013 from a psychiatric registrar at public hospitals setting out the circumstances of SFX’s admission in 2013. The hearing report prepared by a registry officer that was before the Tribunal and provided to the parties is silent as to whether SFX had contact with the registry prior to the hearing date or provided any views about the application.

14. The Reasons for Decision refer to evidence given by OZS (at [12]-[13]) that:

[12]   On numerous occasions since 2013, [SFX] has apparently failed to pay her rent, resulting in [OZS] and/or [UAX] having to intervene and pay her rent or negotiate extensions to allow her to catch up on her rental arrears. She is now six weeks in arrears. Both [UAX] and [OZS] are concerned that if [SFX] becomes homeless again she may attempt self harm.

[13]    [OZS] indicates that the trigger for the present application was the fact that [SFX] was being issued an eviction notice, with 7 days to vacate, due to arrears of rent. [OZS] states that late payment and failure to pay has been an ongoing issue for the owner of the guesthouse since 2013. In 2013 she was evicted from the previous residence and became homeless, living in the car. The only way that regular payments were made was through direct deductions.

15. The Tribunal concluded (at [21]) that

… given that the chronic gambling behaviour of [SFX] is presently untreated and appears to have led to her being unable to pay her housing costs in a timely and consistent manner, resulting in a near eviction, the Tribunal finds that she is not capable of managing her own financial affairs.

16. In relation to its consideration of who should be appointed as SFX’s financial manager, the Tribunal found (at [26]) that

… [OZS] and [UAX] are suitable persons to act as financial managers for their mother and the Tribunal appoints them jointly and severally to that role. They have both remained involved and engaged with their mother, despite the difficulties they have faced. [OZS] and [UAX] asked that their addresses not be disclosed to their mother, to prevent any harassment of them by her. The Tribunal accedes to that request and their addresses are not to be disclosed to [SFX].

Submissions of the parties

17. In so far as far as her submissions were relevant to the matters I had to consider in relation to the set aside application, SFX’s position was as follows:

1. Contrary to the evidence given by her children at the hearing on 26 September 2017 that was accepted by the Tribunal (at [4]) that SFX was “quite aware of the hearing” and that “she has chosen not to attend”, SFX did not take part in the hearing on 26 September 2017 as she did not receive written or verbal notification of the hearing date. SFX states that any written notification of the hearing must have gone astray as she did not receive it.

2. SFX included with her set aside application a signed statutory declaration to this effect.

3. SFX contended that the Tribunal should set aside the order made on 26 September 2017 because, had she known about the hearing date and participated in the hearing, she would have given evidence that she is capable of making her own decisions. SFX states that she would have given evidence that although at the time that the application for financial management was made in July 2017 she was unemployed, reliant upon a pension and suffering depression due to the circumstances of her unemployment, she has since 3 August 2017 been employed on a full time basis as a Deputy Services Manager by an aged care service provider at inner west Sydney, and had paid off a number of debts.

4. SFX also submitted that she would have provided evidence that for a number of months over 2017, she was the applicant in an unfair dismissal claim against a former employer and she was successful in her claim. She was also the defendant in relation to a complaint to the Australian Health Practitioner Regulation Agency by the person against whom she had made the unfair dismissal claim. SFX states that she was successful in defending this complaint.

5. SFX’s submissions acknowledged her history of what she describes as her gambling addiction. She states that she has disclosed her gambling addiction, her depression, and past admission to hospital to her current and former employer and they are supportive of her.

6. SFX also states that following the lodgement of the application for a financial management order in July 2017, SFX has re-established her relationship with her sister and brother-in-law and they provide important emotional support to her. SFX states that she believes that without this type of emotional support from family, she will “revert to excessive gambling as a way of filling a void or when distressed”. It is not clear from SFX’s submission, however, whether this was evidence that would have been given by her at the hearing on 26 September 2017.

7. SFX also submitted that contrary to the evidence given by her children at the hearing and accepted by the Tribunal that she was at risk of homelessness because of her rental arrears, she would have produced evidence at the hearing that both her sister and brother-in-law and a friend would have offered her accommodation had she been in need of it.

8. SFX’s submissions also described her estrangement from her children, the “lack of trust between us”, that she does not feel “safe with my children in control of my finances” and that in relation to OZS, she does not “believe that she will act in my best interests now any more than in the past”.

18. OZS provided detailed written submissions opposing the set aside application. OZS disputed much of what her mother stated in the set aside application and expanded upon the evidence that she provided at the hearing on 26 September 2017. OZS disputed SFX’s statement that she had not received notification of the hearing date. OZS submitted that she had attempted to contact SFX herself via telephone and text message but had received no response.

19. Although UAX was not a party to the financial management application (as he was not an applicant), he was appointed by the Tribunal as one of the financial managers for SFX. In light of this, I have also had regard to his submissions.

20. UAX also opposes the application to set aside the decision. He provided detailed background information that disputed much of what his mother submitted in her set aside application. UAX disputed that his mother had not received notice of the hearing. UAX also contacted his mother by telephone and by text message on the day of the hearing to advise her of the hearing date and time.

Issues

21. Clause 9(1)(b) of the Regulation relevantly provides:

(1) … the Tribunal may order that a decision it has made that determines proceedings be set aside or varied in either of the following circumstances:

…

(b) if the decision was made in the absence of a party and the Tribunal is satisfied that the party’s absence has resulted in the party’s case not being adequately put to the Tribunal.

22. The issues I had to determine in this application were therefore as follows:

1. Was the decision made in the absence of SFX?

2. Did SFX’s absence result in her case not being adequately put to the Tribunal?

3. If the answer to (a) and (b) is yes, then I need to consider whether to exercise the discretion under cl 9 of the Regulation and to decide whether or not the decision should be set aside or varied

Consideration

Was the decision made in SFX’s absence?

23. It is not in dispute that the decision on 26 September 2017 was made in SFX’s absence. The first requirement in cl 9(1)(b) of the Regulation is therefore satisfied.

24. Whilst there is dispute between the parties as to the reasons for SFX’s absence from the hearing on 26 September 2017 and whether or not she received notice of the hearing, or should be taken to have been served with notice of the hearing by the Tribunal, these issues are not relevant to the issue of whether or not the decision was made in SFX’s absence. They are relevant, however, to the exercise of the discretion as discussed below.

Did the absence of SFX result in her case not being adequately put to the Tribunal?

25. SFX had not provided any written submissions or other material to the Tribunal registry before the Tribunal made its decision on 26 September 2017. In these circumstances, SFX’s case could only have been put if she had participated in the hearing.

26. On the basis of her written submissions, had SFX participated in the hearing she would have contested the finding made by the Tribunal that she is incapable of managing her affairs. SFX would have provided evidence to support her position including her employment history, the litigation in which she was involved at the time as well as her account of her debts and how she had managed them at the time of the hearing. SFX’s submissions also indicate that she would have addressed the evidence provided to the Tribunal concerning her gambling history.

27. It is also clear from her submissions that SFX would have provided evidence about the estranged nature of her relationship with her children, their suitability (in her view) for appointment as her private financial managers, and is likely to have opposed their appointment based on her view of her relationship with them.

28. I am satisfied that in circumstances where SFX had not provided any evidence or material in advance of the hearing, her absence meant that her case, although disputed in many respects by the other participants in the hearing, was not put to the Tribunal. The second part of cl 9(1)(b) of the Regulation is therefore also satisfied.

Should the discretion be exercised and if so how?

29. Since both requirements of cl 9(1)(b) of the Regulation are satisfied, the discretion whether or not to set aside the original decision is enlivened. The principles applicable to the discretion to set aside a decision under cl 9(1) of the Regulation are set out in Hammond v Ozzy’s Cheapest Cars Pty Ltd t/as Ozzy Car Sales [2015] NSWCATAP 65 (at [75]-[81]) and are summarised (at [80]-[81]) as follows:

[80] In summary, when exercising the discretion conferred by cl 9(1)(b), the Tribunal should direct its attention to whether there would be a real likelihood of injustice if the decision was allowed to stand. Relevant considerations will generally include:

(1)    Why the party was absent and whether the absent party had a reasonable opportunity to be heard or otherwise have its submissions considered in the proceedings; and

(2)    Whether the absent party has an arguable defence or an arguable case that a different decision could have been reached.

[81]    Setting aside a decision will naturally involve a degree of prejudice to the party which was initially successful. As part of the exercise of the discretion, the Tribunal should also consider how that prejudice can be cured or reduced, for example by the framing of any set aside order or by the imposition of suitable conditions on that order. Conditional orders can be made in the Tribunal under s 58 of the Act.

30. Whilst these principles were developed in the context of an action under the Consumer Claims Act 1998(NSW) in the Consumer and Commercial Division, they are also relevant to proceedings in the Guardianship Division of the Tribunal.

Why SFX was absent and reasonable opportunity to be heard

31. The Tribunal file confirms that written notice of the hearing listed on 26 September 2017 was posted to SFX’s residential address on or about 11 September 2017. Under the Civil and Administrative Tribunal Rules 2014 (NSW) (the Rules), unless the contrary is proved, in the case of a copy of a notice that is posted, the time at which the notice is taken to be served on the person is at the end of the fourth working day after the date on which the notice was posted to the person (r 13(4)(a)). Therefore the notice of hearing may be taken to have been served on SFX on or about 15 September 2017. If it is accepted that SFX is taken to have been served on or about this date, then it is arguable that she had a reasonable opportunity to be heard and have any submissions considered in the hearing, but chose not to do so.

32. SFX has given evidence in the form of a statutory declaration and other written submissions, however, that she did not receive the notice of hearing. Whilst there is a presumption under the Rules that SFX was properly served with notice of the hearing, it is not inconceivable that the notice of hearing posted to SFX did not reach her, for example, because it went missing in the mail or for some other reason.

33. This is disputed by OZS and UAX and submissions were made not only as to why SFX should be found to have received the notice of hearing but that they also took steps to inform her of the hearing date and time. These submissions do not, however, establish that SFX in fact received notice of the hearing.

34. I have had regard to these factors and the uncertainty as to whether SFX received the notice of hearing in considering the exercise of my discretion.

35. It is clear, however, that because SFX had not provided any material responding to the application and nor does it appear that she had any contact with the Tribunal registry leading up to the hearing, the Tribunal did not have available to it any indication as to SFX’s views about the application.

Arguable case for a different decision

36. It is difficult to determine whether or not the submissions and evidence SFX has indicated she would have presented at the hearing would have led to a different result as it would have depended on how the Tribunal weighed evidence given by SFX against other evidence. However on the material presently available I am of the view that it could be concluded that SFX at least has an arguable case that may have led to a different result as to whether a financial management order was made and, in particular, whether she is incapable of managing her affairs given the presumption that a person of full age is capable of managing his or her affairs unless the presumption is rebutted (Murphy v Doman (2003) 58 NSWLR 51, [34]–[36] (per Handley JA); Scott v Scott [2012] NSWSC 1541, [233]; Coffey v Coffey (No. 2) [2015] NSWSC 338, [15]–[19]).

37. I am also of the view that SFX has an arguable case that may well have led to a different result as to the issue of who should be appointed as her financial manager/s. SFX’s submissions indicate that she would have opposed the appointment of either of her children as her financial manager. This would have been an important consideration for the Tribunal had the evidence been before them given that under s 4(d) of the Guardianship Act 1987 (NSW), the Tribunal has a duty to observe the principle that the views of the person who is the subject of an application should be taken into consideration.

Prejudice to other parties

38. If the set aside order is made, it is likely that there will be prejudice to SFX’s children given their time and effort expended in attending, leading their evidence and making submissions at the hearing on 26 September 2017, and in opposing the set aside application. These are relevant matters for me to take into account when considering whether to set aside the decision. I also note, however, that the submissions provided by OZS and UAX propose that they be replaced as their mother’s private managers as a result of SFX’s objection to their appointment and an application seeking review of the financial management to this effect has now been made.

Injustice

39. The critical issue in this case, in my view, is that SFX was the subject of the financial management application and that it is her rights and freedoms that are fundamentally affected by the making of an order in her absence. The potential for injustice is heightened in these circumstances.

39. The course of action taken at the hearing is relevant to this consideration.

40. There is no indication in the written Reasons for Decision that the Tribunal made an attempt to contact SFX during the hearing, to try to contact her by way of the place at which she lives (described as a guesthouse or private hotel) or to otherwise seek to ascertain from any other source (other than her two children who were seeking the order made) the reason for SFX’s absence from the hearing. Nor is there any indication in the written Reasons for Decision that the Tribunal contemplated an adjournment of the hearing to make enquiries or perhaps to provide SFX with another opportunity to participate in the hearing. Why this approach was taken by the Tribunal is particularly unclear given the obligation created by s 4(d) of the Guardianship Act for the views of the person who is the subject of an application to be taken into consideration by the Tribunal. As was also noted in H v H [2015] NSWSC 837, [37] (Lindsay J):

[i]f in doubt, there is no substitute for a direct, personal engagement with the person whose capacity for self-management is under consideration, and those closely associated with him or her in daily living.

42. In the exercise of a protective jurisdiction, it is not uncommon for the Tribunal to determine that it should proceed to hear a matter in the absence of the person who is the subject of an application particularly where there is evidence that the person’s health, welfare or estate are at risk. However, given the impact that the making of an order has on the rights and freedom of a person to manage their own affairs and the importance of the principle set out in s 4(d) of the Guardianship Act, the Tribunal is obliged, in my view, to take reasonable steps to satisfy itself that the person has been given a genuine opportunity to participate in a hearing that is about them and to provide their views to the Tribunal. What will constitute reasonable steps will depend on the circumstances of each matter and would need to be considered on a case by case basis. In this matter I am of the view that reasonable steps were not taken.

43. The Tribunal’s failure to take reasonable steps to ascertain SFX’s views also raises a question as to how the Tribunal fulfilled the duty placed upon it under s 4 of the Guardianship Act to observe other relevant principles, notably the principle that the freedom of decision and freedom of action of a person should be restricted as little as possible (s 4(b)), such persons should be encouraged, as far as possible, to live a normal life in the community (s 4(c)) and should be encouraged, as far as possible, to be self-reliant in matters relating to their personal, domestic, and financial affairs (s 4(f)).

44. Taking all of the above considerations into account I am satisfied that there would be a real likelihood of injustice if the decision was allowed to stand.

45. Accordingly, the order made on 26 September 2017 should be set aside.

**********

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

Amendments

30 January 2019 - In the Catchwords section: "wether" changed to "whether".

Decision last updated: 30 January 2019