TBI (Administration)

CITATION:	TBI (Administration) [2019] TASGAB 24
HEARING DATE(S):	16 August 2019
DATE OF ORDERS:	16 August 2019
DATE OF STATEMENT OF REASONS:	5 September 2019
BOARD:	Ms E Clippingdale Ms V Jones Mr C Partridge
APPLICATION	Application for Administration
CATCHWORDS:	Appointment of private administrator; eligibility of appointment as private administrator, conflict of interest of potential administrator
LEGISLATION CITED:	Guardianship and Administration Act 1995 (Tas), ss 6, 51, 54
PUBLICATION RESTRICTION:	The decision has been anonymised for the purpose of publication

Statement of Reasons

Background

On 16 August 2019, the Guardianship and Administration Board (‘the Board’) heard an Application for Administration for TBI at the Launceston Magistrates’ Court.
The Board found TBI is a person with a disability and, because of his disability, he is
·unable to make reasonable judgements in respect of his financial circumstances; and
·is in need of an administrator.
Full details of the Orders appear at the end of this Statement of Reasons.
The Applicant DS has requested a Statement of Reasons in relation to the Board’s decision. This Statement of Reasons deals with the appointment of the Public Trustee (Tas) as Administrator for TBI.

Hearing

In attendance at the hearing were:
a.TBI;
b.the Applicant (and sister of the proposed represented person) DS; and
c.the Applicant’s husband QS.
The Board had before it the following documents:
a.Application for Administration dated 25 June 2019 by DS;
b.Health Care Professional Report (‘HCPR’) dated 19 June 2019 of Dr PP Janaka Somarathna; and
c.National Police Check for DS dated 2 July 2019.

Legislation

Pursuant to the Guardianship and Administration Act 1995 (‘the Act’), when the Board assesses an Application for the appointment of an Administrator it needs to be satisfied of the matters in section 51 of the Act, namely that the proposed represented person:
a.is a person with a disability, and
b.is unable by reason of the disability to make reasonable judgements in respect of matters relating to all or any part of his estate; and
c.is in need of an administrator of his estate.
The Board must also balance the principles in section 6 of the Act, which include:
a.adopting the means which are least restrictive of the proposed represented person’s freedom of decision and action as is possible in the circumstances;
b.promoting the best interests of the proposed represented person; and
c.that, if possible, the wishes of the proposed represented person are carried into effect.

Evidence

As mentioned above, the evidence before the Board included a HCPR of Dr PP Janaka Somarathna of 19 June 2019. The HCPR states TBI has an intellectual disability of Trisomy 21 which has been evident since birth and that it is a static disability with a poor prognosis. The HCPR states TBI was
…born with Trisomy 21, he is intellectually impaired and need[s] a carer to attend to his health and financials. He won’t be able to handle his money and expenses, with out [sic] the help of a reliable carer.
Dr Somarathna stated in the HCPR TBI’s capacity for new learning, his planning and reasoning skills, and the likelihood he would be susceptible to influence, had all been negatively impacted by his disability. Dr Somarathna stated ‘[b]ecause of his intellectual disability and his learning disabilities, it is not possible for him to manage his finances by himself, the nature of Trisomy 21 itself, end up with all these incapabilities.’
Dr Somarathna stated further in the HCPR ‘[h]e has no idea of money and property. He has no idea about the cost of shoes he was wearing. He can’t count to 20 even.’
The Board asked whether DS and QS accepted the medical evidence that had been provided at the hearing about TBI and they indicated their acceptance of the medical evidence.
There was no further evidence introduced that challenged the proposition that TBI lacked capacity in a range of areas, and that this incapacity was a direct result of his disability.
The Board was of the view that the only reasonable conclusion was that TBI had a disability, and as a result of this disability lacked the capacity to make reasonable decisions in relation to matters concerning his estate.
The need for an Administrator was quite evident. DS gave evidence to the effect TBI has been supported by herself and QS since TBI came to live with them around 2012, that they manage TBI’s finances on his behalf (including his bank accounts, NDIS arrangements and Centrelink pension), and gave an example to the Board that TBI would not know if he received the correct change if he made a purchase using cash.
DS also indicated TBI is a beneficiary under the Will of his late grandmother. DS gave evidence in relation to her late grandmother’s Will and estate to the effect the estate’s worth is approximately $875,000, there are 12 beneficiaries, the Will establishes a ‘Disability Trust’ for TBI, and that herself, another brother and TBI were at a financial disadvantage with the proposed distribution as per the terms of Will. DS advised she had sought legal advice for herself regarding a proposed settlement of a claim for herself, her brother and TBI. The advice was to the effect that to avoid the complexities of the Disability Trust, it would be better to sign a Deed of Family Agreement (‘the Deed’) with all the beneficiaries and for DS to apply for administration of TBI’s estate. DS believed the Deed was fairer between beneficiaries, that it would enable the estate of the late grandmother to be distributed sooner, and was hoping it would prevent the dispute going to court and hence keep legal fees to a minimum, that is, preserve the estate. The Deed’s net result to TBI was that he would receive approximately $90,000, the same as DS and the other brother.
It appeared clear to the Board that a real need existed for the appointment of an Administrator. This view was supported by all present at the hearing.
The subject of this Statement of Reasons is why the Public Trustee was appointed in preference to a private Administrator (i.e. DS) when the Application before the Board was to appoint DS as TBI’s Administrator.
Section 54 of the Act sets out who the Board may appoint as an Administrator. The potential Administrators include the Public Trustee and any other person who consents to act as Administrator of TBI’s estate if the Board is satisfied that:
i.The person will act in the best interests of TBI; and
ii.The person is not in a position where his or her interests conflict or may conflict with the interests of TBI; and
iii.The person is a suitable person to act as the Administrator of the estate of TBI; and
iv.The person has sufficient expertise to administer the estate.[1]
In determining whether a person is suitable to act as an Administrator the Board must take into account:
a)The wishes of TBI, so far as they can be ascertained; and
b)The compatibility of the proposed Administrator with TBI.
[1] Guardianship and Administration Act 1995 (Tas), s54(1)(d).
During the hearing, DS described her future plans for TBI’s inheritance. These plans include providing him with an independent living arrangement on her and her husband’s property. DS’s first plan was to renovate a granny flat on her and her husband’s property. When asked by the Board if DS saw a potential conflict of interest between her assets and those of TBI’s assets, DS agreed she could see a conflict of interest.
When asked by the Board whether or not DS had sought independent legal advice as to a potential claim for a larger share for TBI from the estate of his late grandmother, DS advised she had not as she believed the fairest outcome was an equal three-way split between herself, TBI and the other brother. DS further indicated to the Board that she had already indicated to the other beneficiaries her and TBI’s in-principle agreement to a share of one-third of the estate with the other brother, without obtaining independent legal advice for TBI and on the basis she believed TBI would receive more this way than as per the exact terms of the Will of her late grandmother. DS was also anxious to maintain family harmony between all the beneficiaries of her grandmother’s estate and believed the proposed Deed would allow this to occur. DS emphasised several times the importance of preserving the overall amount in her late grandmother’s estate and not allowing any diminution due to any legal proceedings.
The Board was not satisfied based on the evidence of DS that she was not in a position where her interests conflict or may conflict with TBI, particularly as legal advice regarding the success or otherwise for a potential larger claim for TBI on his grandmother’s estate had not been sought; that DS was by circumstance a beneficiary who may choose to oppose such a claim by TBI as her share of the estate may be lessened depending on the outcome of any claim by TBI; that DS preferred to put a harmonious outcome within the family ahead of any advice surrounding any potential claim of TBI’s on the estate; that DS was wary of any legal fees the estate may have to pay to settle any legal proceedings; and that DS had admitted to a potential conflict of interest between the assets of her own and those of TBI.
The Board was unable to satisfy itself that the condition in section 54(1)(d)(ii) of the Act was met and therefore had no alternative other than to consider DS ineligible to act as Administrator of TBI’s estate.
Due to the failure of the proposed Administrator to meet one of the four conditions contained in section 54, the Board did not need to make a determination on DS’s eligibility under the other three conditions. In delivering its decision, the Board did stress that when the grandmother’s estate had been distributed and decisions made as to suitable investment of the inheritance on TBI’s behalf by an independent Administrator, it may be an Application for Review of Order can be filed considering the appointment of a private Administrator as it may be that a conflict of interest may not be identified at that time.
Having determined that the proposed Administrator was ineligible for appointment, the Board’s only option was to appoint the Public Trustee as Administrator of TBI’s estate. This power is conferred to the Board by section 54(1)(a) of the Act, and no determination is required as to the eligibility of this appointment.

Decision

The Board is satisfied TBI:
a.is a person with a disability;
b.is unable by reason of the disability to make reasonable judgements in respect of his estate; and
c.is in need of an Administrator.
The Board Orders:
1. That the Public Trustee (Tas) is appointed as Administrator of the estate of the Represented Person.
2. That the powers and duties of the Administrator be those conferred by Division 4 of Part 7 of the Guardianship and Administration Act 1995.
3. That the Order remains in effect until the 15^th day of August 2022.

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[2019] TASGAB 24

16 August 2019