Supreme Court New South Wales Medium Neutral Citation: Re Application for Partial Management Orders [2014] NSWSC 1468 Hearing dates: 29 September and 13 October 2014, with written submissions and a court-ordered report from the NSW Trustee Decision date: 24 October 2014 Jurisdiction: Equity Division - Protective List Before: Lindsay J (in chambers) Decision: (1) Application for partial management (or exclusion) orders under the NSW Trustee and Guardian Act 2009, s 40, withdrawn and dismissed. (2) Directions for management of protected estate. Catchwords: MENTAL HEALTH - Guardians, committees, administrators, managers and receivers - Appointment - Application for appointment of a protected estate manager - Orders for management of the whole, or part, of a protected estate - Principles governing partial management (and exclusion) orders. PRACTICE - NSW Trustee & Guardian Act - Appointment of estate manager - Orders for management of the whole, or part, of a protected estate - Principles governing partial management (and exclusion) orders . Legislation Cited: NSW Trustee and Guardian Act 2009 NSW, s 64, 65, 66 Protected Estates Act 1983 NSW Jurisdiction of Courts (Cross Vesting) Acts 1987) Uniform Civil Procedure Rules 2005 NSW NSW Trustee and Guardian Act 2009 ss 40-41(1), 71(1) Cases Cited: Countess of Bective v Federal Commissioner of Taxation (1932) 41 CLR 417 at 420-423 Hazairin Iskandar v Zulfikri Mahbur and Ors (No 6) (2010/122386, 15 February 2012) at [23]-[28] In re Walker (a lunatic so found) [1905] 1 Ch 160 at 170-174 David by her tutor the Protective Commissioner v David (1993) 30 NSWLR 417 RAP v AEP [1982] 2 NSWLR 508 at 512C-D Re DEF and the Protected Estates Act 1983 [2005] NSWSC 534 at [5] (4), [16] and [25]-[26] Re K, an incapable person in receipt of interim damages awards [2014] NSWSC 1286 Re Public Trustee of Queensland [2001] QSC 215; 2002 1 Qd R 644 at [10]) Re W and L (Parameters of Protected Estate Management Orders) [2014] NSWSC 1106 Re W and L (Parameters of Protected Estate Management Orders) [2014] NSWSC 1106 at [9]-[10] Texts Cited: Theobald, The Law Relating to Lunacy (1924), pp 380 and 382 Category: Principal judgment Parties: Plaintiff: Wife of protected person Defendant: Protected person Representation: Plaintiff: self represented Defendant: self represented Amicus curiae (Father of Defendant): self represented File Number(s): 2014/00172627 Judgment 1Chapter 4 (ss 38-100) of the NSW Trustee and Guardian Act 2009 NSW, entitled "Management functions relating to persons incapable of managing their affairs", includes the following provisions: "Section 39. General principles applicable to Chapter It is the duty of everyone exercising functions under this Chapter with respect to protected persons or patients 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. Section 40. Orders for management may apply to part of estate An order may be made under this Chapter for the management of the whole or part of the estate of a person. Section 41. Orders by Supreme Court for management of affairs (1) If the Supreme Court is satisfied that a person is incapable of managing his or her affairs, the Court may: (a) declare that the person is incapable of managing his or her affairs and order that the estate of the person be subject to management under this Act, and (b) by order appoint a suitable person as manager of the estate of the person or commit the management of the estate of the person to the NSW Trustee. (2) The Supreme Court may make an order on its own motion or on the application of any person having a sufficient interest in the matter. ..." 2These proceedings focus attention on the operation of s 40, in the context of an application for the appointment of a private manager (that is, a manager other than the NSW Trustee) under s 41(1)(b). 3Section 40 has no analogue in the Protected Estates Act 1983 NSW, the legislation repealed and replaced by the NSW Trustee and Guardian Act 2009. 4Inclusion of s 40 in the 2009 Act resolved, in favour of jurisdiction in the Court to make an order that part only of the estate of a person be subject to management, a doubt that was noted (but not necessary to resolve) in Re DEF and the Protected Estates Act 1983 [2005] NSWSC 534 at [5] (4), [16] and [25]-[26]. 5Comparatively little attention has been given to the operation of s 40 since its enactment in 2009. 6In New South Wales, management orders made by the Court are ordinarily made in terms designed to attach to the whole (rather than merely a part) of the estate of a person in need of protection, with flexibility in management of particular cases provided for in deployment of: (a)the powers of the Court and the NSW Trustee to give directions (for example, under the NSW Trustee and Guardian Act, ss 64-65); and (b)the power of a private manager (under s 71 of the Act) to authorise a managed person (an expression defined, by s 38, to include a "protected person", defined by the same section in terms to include a person in respect of whom a management order under s 41 is in force) "to deal with so much of the estate as the manager considers appropriate" and is specified in a written instrument, with the approval of the NSW Trustee. 7Importance attaches to an appreciation that the practice of decision-makers attending an exercise of protective jurisdiction depends, sometimes quite heavily, on the legislative and administrative framework within which decisions must ordinarily be made. 8In Re DEF and the Protected Estates Act 1983 [2005] NSWSC 534 Campbell J was required to consider complications arising in management of a protected estate because management orders affecting the NSW Protective Commissioner (a statutory predecessor to the NSW Trustee) were made by a judge of the Supreme Court of Queensland (pursuant to the NSW and Queensland Jurisdiction of Courts (Cross Vesting) Acts 1987) in a manner that may have conformed to Queensland practice, but departed from NSW practice: see [3]-[7] and [15]-[16]. 9It may be that, in states and territories other than New South Wales, "a partial management order" (to adapt a term found in Re Public Trustee of Queensland [2001] QSC 215; 2002 1 Qd R 644 at [10]) is more common than such orders are in New South Wales. I do not intend, by this judgment, to address interstate practice. 10One needs, also, to recognise that an exercise of protective jurisdiction must be focussed on the circumstances of the particular case, bearing in mind the paramountcy of the welfare and interests of a particular person in need of protection, and the importance attaching to the administration of a protected estate "without strife in the simplest and least expensive way": HS Theobald, The Law Relating to Lunacy (1924), pp 380 and 382; RAP v AEP [1982] 2 NSWLR 508 at 512C-D. 11One needs to bear in mind, also, the importance attributed, by s 39 of the NSW Trustee and Guardian Act 2009, to the autonomy of a protected person and his or her family in management of a protected estate. Section 39 reflects the concern of the Court's protective jurisdiction to place at centre stage the best interests of a protected person, and to test all decisions against what may be of benefit to him or her: Holt v Protective Commissioner (1993) 31 NSWLR 227 at 238 and 241; RL v NSW Trustee and Guardian (2012) 84 NSWLR 263 at 285(96). 12Management orders are intended to provide a protective regime for management of the estate of a person in need of protection, minimising the intrusive character of any such regime. A management order is a means to an end, not an end in itself: Re W and L (Parameters of Protected Estate Management Orders) [2014] NSWSC 1106. 13An example of the circumstances in which s 40 has come under specific consideration is Re K, an incapable person in receipt of interim damages awards [2014] NSWSC 1286, in which the focus for attention was the interplay between s 40 and the Civil Procedure Act 2005 NSW, ss 77 and 79, as well as s 40's relationship with those provisions of the Civil Procedure Act 2005 NSW and the Uniform Civil Procedure Rules 2005 NSW (UCPR Part 7 Div 4 (rr 7.13-7.18)) governing the appointment and supervision of tutors for incapacitated persons involved in civil proceedings. 14An alternative approach, in which the Court made a partial management order (under the NSW Trustee and Guardian Act 2009, ss 40-41(1)) in aid of appointment of the NSW Trustee (under UCPR r 7.15(3)) as tutor of an incapable person is the unreported judgment of Slattery J in Hazairin Iskandar v Zulfikri Mahbur and Ors (No 6) (2010/122386, unreported, 15 February 2012) at [23]-[28]. 15Attention focusses on s 40 in the present proceedings because: (a)the plaintiff applied for management orders (including an order for the appointment of a licensed trustee company as manager) against so much, and no more, of the estate of her husband (the defendant) as comprised an award of personal injuries compensation made to him in separate, Common Law proceedings. (b)that compensation was awarded to the defendant in proceedings conducted by the plaintiff, as his tutor, in the District Court of NSW. (c)the necessity for the defendant to conduct those proceedings through a tutor arose from the fact that (within the meaning of UCPR rr 7.13 and 7.14) he was, because "a person who is incapable of managing his or her affairs", a person under a legal incapacity. (d)the necessity for management orders under the NSW Trustee and Guardian Act arose from the fact that, in accordance with s 77 of the Civil Procedure Act, the defendant's compensation money was paid into court, at the end of the Common Law proceedings, to abide a further order of the Court designed to protect the interests of the defendant as a person incapable of managing his affairs. (e)an order for the payment of compensation money out of court (pursuant to CPA s 77) is not uncommonly, as in the present proceedings, sought in the same proceedings in which an application for management orders is made under s 41(1) of the NSW Trustee and Guardian Act. (f)in dealing with the plaintiff's application for management orders in chambers, I made orders under s 41(1), in the usual form, for appointment of the trustee company as manager of the whole of the defendant's estate, reserving to the plaintiff liberty to apply, on notice to the defendant's manager and the NSW Trustee, for variation of the management orders so as to limit their operation. (g)the plaintiff, with the support of the defendant and the father of the defendant (all three of whom share ownership of the matrimonial home of the plaintiff and the defendant), almost immediately applied to the Court, by an email marked as Exhibit "P1", for an order under s 40, in the form of an "exclusion order", limiting the operation of the management orders to the defendant's compensation money. (h)the declared, substantive objects of that application were: (i) to exempt from the management regime affecting the defendant's estate his interest in the matrimonial home; and (ii) to permit the plaintiff to manage the matrimonial home, unconstrained by the regulatory powers of the NSW Trustee, in the same manner as she has for the better part of two decades during which her husband has suffered a disability. (i)the trustee company appointed to manage the defendant's estate did not, but the NSW Trustee did, object to the application. 16The fact that the plaintiff initially applied for partial management orders, but the Court made orders for management of the whole of the defendant's estate, is an illustration of the public interest character of the Court's protective jurisdiction. That character is recognised in the express power conferred on the Court by s 41 of the NSW Trustee and Guardian Act to make management orders on its own motion. The protective jurisdiction is not an adversarial or consent jurisdiction, but one in which the Court is bound to exercise an independent judgment informed by the nature of, and the purpose served by, the jurisdiction: M v M [2013] NSWSC 1495 at [50](a)-(c). 17In the course of dealing with the plaintiff's application for an "exclusion order" under s 40, I invited her, her husband and her father-in-law (all of whom attended before me, with the benefit of an appearance on behalf of the NSW Trustee, on two occasions) to consider whether the plaintiff herself, together with a co-manager from within the family, should not be appointed to manage the defendant's estate in lieu of the trustee company. The management structure the family has chosen appears to me to be more complicated than it need be. It is not obvious to me that the family needs the intervention of a trustee company as manager. Nor is it apparent why co-managers drawn from the family could not, in management of the defendant's estate, simply utilise the services of a financial adviser related to the trustee company on the basis of an ordinary retainer approved, from time to time, by the NSW Trustee. Nevertheless, I respect the family's considered preference for their nominated trustee company to continue as manager of the defendant's estate. 18I intend no criticism of the trustee company in recording that the absence of any objection to its mandate being limited (by an order made under s 40) to the defendant's compensation money is unremarkable. Professional managers of protected estates not uncommonly submit to orders of the Court (including, in particular, orders for the revocation of management orders) rather than be seen to take a role governed by commercial self interest. That is as it should be: Ability One Financial Management Pty Limited and Anor v JB by his tutor AB [2014] NSWSC 245 at [152]-[153]. Moreover, if a partial management order were to be made, the effect of it, from the manager's perspective, might be simply to confirm the manager in a role analogous to that of the trustee of a fund, reserving to it a right to apply to the Court and the NSW Trustee for directions in the event of difficulties arising in the course of management. The substantive burden of giving practical, protective effect to a management regime based on partial management orders may fall on the NSW Trustee, as monitor of the manager rather than on (or only on) the manager. Given the Court's reliance on the due performance by the NSW Trustee of its statutory functions, that fact should not be overlooked. 19Any form of management order having been made, the regulatory role of the NSW Trustee cannot be excluded. Under chapter 4 of the NSW Trustee and Guardian Act (and under similar provisions governing "financial management orders" made by the Civil and Administrative Tribunal of NSW ("NCAT"), Guardianship Division, under the Guardianship Act 1987 NSW) the NSW Trustee has a vital role to play either as a manager or as a monitor of private managers: M v M [2013] NSWSC 1495 at [11]-[12]. 20Whatever the form of management orders, the availability of procedures for directions to be sought is an ever-present protection for everybody concerned in the management of a protected estate. Those procedures are designed to facilitate problem solving that is both expeditious and inexpensive. 21In a report prepared by the NSW Trustee at my direction, for the benefit of the Court and the parties, the following passages summarised the position taken by the NSW Trustee: "10. [The NSW Trustee] would not recommend an amendment to the current financial management order to exclude the family home in which the defendant has an interest for the following reasons: ● If an asset is excluded from a financial management order there is no security against, for example, the selling of the asset and disposal of the funds without the knowledge of [the trustee company appointed as manager of the defendant's estate]. This would leave [the Manager] incurring unexpected costs for the estate to cover the loss of the asset. ● [The Manager] may have difficulty satisfying [its] requirement to ensure that the defendant's assets are protected. ● [The Manager] must satisfy [itself] that the defendant is paying for his share only of the costs of the residence. ● The exclusion order would, in effect, divide the estate in two with [the Manager] managing funds formally with the oversight of NSW Trustee and the jointly owned assets and account being managed informally by the defendant's spouse and/or his father. This may lead to possible conflicts of interest in the informal management of the jointly owned assets. 11. To accommodate the wishes of the plaintiff, defendant and the defendant's father and the requirements of the current order, the following procedure could be implemented: An Additional Direction to be issued to [the Manager] authorising the following: ● That an annual budget be submitted to NSW Trustee detailing the costs of the upkeep and daily running costs associated with the family home. ● That [the Manager] be authorised upon receipt of written approval from NSW Trustee to pay to the plaintiff and defendant a lump sum in advance for the defendant's annual share of such costs associated with the maintenance, rates, taxes, and repairs as may be required. ● [The Manager] to require from the plaintiff and defendant an accounting of the funds expended on behalf of the defendant on the family home. 12. The Additional Direction is designed to be less intrusive to the defendant and his family whilst maintaining the role of the private manager in protecting the family home and monitoring costs to the defendant's estate." 22The position taken by the NSW Trustee in paragraph 10 of the report accords with my understanding of this Court's experience in the supervision (via the NSW Trustee, and its statutory predecessors, and managers directly) of protected estate management. 23The affairs of a person incapable of managing his or her own affairs generally need, in service of the Court's protective jurisdiction, to be susceptible to overall control by a protected estate manager (monitored by the NSW Trustee and under the supervision of the Court) even if, as is contemplated, for example, by s 71 of the NSW Trustee and Guardian Act, the facility for overall control is used to allow a managed person to operate with a degree of autonomy (even a substantial degree of autonomy) in particular respects. 24A manager appointed to manage only part of the estate of a person incapable of managing his or her affairs (and, by extension, a body such as the NSW Trustee charged with responsibility for monitoring the manager's performance of management functions) may be at a disadvantage in performance of his, her or its protective function if that part of the estate not under management can be dealt with by a person in need of protection under the influence of another (perhaps a member of family, perhaps a friend, perhaps a stranger) not subject to regulatory oversight of the same character. 25For reasons explained in Re K, an incapable person in receipt of interim damages awards [2014] NSWSC 1286, the conduct of proceedings for personal injuries compensation does not generally need a regime of management orders, and the proceedings are generally best left to a tutor for an incapable person operating under the supervision of the Court hearing those proceedings. However, once such proceedings have concluded in an award of compensation in favour of an incapable person, different considerations apply. It is necessary, then, to consider whether management orders are necessary (and, if so, how they can be moulded, by directions or otherwise) to protect the incapable person. 26The power of a managed person to deal with his or her estate is suspended in respect of so much of that estate as is subject to management under the NSW Trustee and Guardian Act: s 71(1); David by her tutor the Protective Commissioner v David (1993) 30 NSWLR 417; [1905] 1 Ch 160 at 170-174. 27Ordinarily, a management order should extend to the whole of the estate of a person in need of protection (or, at least, so much of the estate as comprises a substantial interest in property) so as to maximise its effectiveness. 28It is not necessary, or desirable, in these proceedings to explore particular circumstances in which partial management orders can, or should, be made. An example that readily comes to mind is a case (such as where management orders have been made interstate and, pursuant to ss 40 and 42, local orders are limited to an incapable person's estate in NSW) in which there is in place an alternative regulatory regime able to protect the interests of a person in need of protection so far as concerns property not within the scope of management orders. 29It may be (as was recognised in Re W and L (Parameters of Protected Estate Management Orders) [2014] NSWSC 1106 at [9]) that partial management orders can, and should, be called in aid of "self management", allowing a protected person to manage part of his or her own estate if capable of doing so. However, a better vehicle for allowing autonomy to a managed person may be found in s 71 or permissive directions for management of an estate. 30As a general proposition, in considering whether to make partial management orders the Court generally needs to consider what (if any) arrangements are in place to ensure an orderly conduct of business between the protected estate manager and whoever may be, in law and practice, responsible for management of that part of a protected person's estate not directly affected by the Court's management orders. 31In making these observations I am conscious of, and I have taken into account, three factors that might be thought (in my opinion, incorrectly) to point in an opposite direction, in favour of partial management orders being routinely made. 32First, although the general principles enunciated in s 39 of the NSW Trustee and Guardian Act support the notion that management, and ancillary, orders should be made in a form that is the least restrictive of the freedom of a managed person and his or her family, that injunction must be read in the light of the legislative scheme as a whole, its nature and purpose and, in particular, in light of a need to ensure that a protected estate is duly managed. 33Limitation of management orders to part only of an estate is not the only, and should not be the primary, means of serving the freedom of a managed person and his or her family. A person in need of protection should be, as far as he or she reasonably can be, protected. The respective powers of the Court and the NSW Trustee are, generally, sufficiently flexible to operate within a protective regime in which the whole (and not merely a part) of the estate of a person in need of protection is placed under management. 34Secondly, although the introduction of s 40 into the NSW legislative scheme in 2009 served to confirm the availability of partial management orders as a matter of jurisdiction, enactment of the section did not displace the need to give primacy to the welfare and interests of a person in need of protection, or the practical importance to efficient management of a protective regime ordinarily reflected in a need to have the whole (and not merely a part) of an estate under management. 35Thirdly, although s 25E(3) of the Guardianship Act 1987 was repealed at the same time as s 40 of the NSW Trustee and Guardian Act was enacted, its repeal should not be taken to have rendered partial management orders more, or less, desirable than might otherwise have been the case. Section 25E(3) imposed on the Guardianship Tribunal (the predecessor of the Guardianship Division of NCAT) an obligation not to "exclude a specified part of the estate [of a person to be subject to management] from a financial management order" without allowing the Protective Commissioner an opportunity to be heard. The repeal of s 25E(3) removed a jurisdictional impediment to the making of a partial (financial) management orders or an exclusion order. It did not change the principles applicable upon a consideration of whether such orders should be made. 36In protected estate management, as in other areas of the law in which a regulatory regime is deployed, the efficacy of the process of regulation often entails a general order restrictive of the freedom of action of those the subject of regulation, coupled with a power residing in a regulatory authority to grant (absolutely or on terms) a licence, or permission, to engage in conduct that would otherwise be impermissible. Whatever their scope, management orders can generally be viewed in a similar light. 37The best interests of a managed person can, generally, be served in a way that accommodates both freedom of action and need of protection in the context of management orders that attach to the whole of the person's estate. It is generally not necessary, and in some cases it might be counterproductive, to make partial management orders under an impulse towards minimising the role of a regulatory authority such as the NSW Trustee. Exclusion of part of an estate from management may put that part of the estate beyond reach even if, at a later time, the best interests of a managed person require it to be managed. 38As noted in Re W and L (Parameters of Protected Estate Management Orders) [2014] NSWSC 1106 at [9]-[10], under the 19th century practice of the English Lord Chancellor that continues to inform the "inherent" jurisdiction of this Court, a "lunatic (by commission so found)" could be left to manage his or her own affairs, so far as able, by an order granting him or her liberty to engage in a particular class of business, coupled with directions. 39We do not, today, embrace language that refers to "lunatics" and the like, and the jurisdiction of the Court (both inherent and statutory) relating to the protection of people incapable of managing their own affairs, is larger than that which formerly governed a "lunatic". However, the old law, usefully discussed in HS Theobald's The Law Relating to Lunacy (London, 1924), continues to provide guidance for dealing with the protection of people in need of protection. 40Conceptually, the point about a need for, and the availability of, flexibility in the management of a protected estate is taken up by the NSW Trustee in paragraph 11 of its report. The reference to an "Additional Direction" in that paragraph is an allusion to the fact - mentioned earlier in the report - that, in the ordinary course of monitoring the protected estate of the defendant, the NSW Trustee had earlier issued "Directions and Authorities" to the manager stipulating parameters within which the estate could be managed. 41Such stipulations serve, incidentally, as guidelines for management of the estate. The topics they embrace include authorisation of payment by a manager of a protected person's reasonable living costs, including the protected person's proportional share of joint liabilities such as rates, taxes and recurrent outgoings on a jointly owned matrimonial home. 42The "Additional Direction" proposed by the NSW Trustee appears to have been formulated, in part, to accommodate the fact that, in terms, s 71 of the NSW Trustee and Guardian Act contemplates a grant of authorisation to a managed person, rather than to the member of the family of a managed person, to transact business of a particular type. Section 71 does not, in terms, permit a grant of formal authority to the plaintiff, rather than to the defendant. 43Notice should, however, be taken of the breadth of ss 64, 65 and 66 of the NSW Trustee and Guardian Act: "Section 64. Orders by Supreme Court and NSW Trustee as to management of estates (1) The Supreme Court or the NSW Trustee may make such orders as it thinks fit in relation to the administration and management of the estates of managed persons. (2) The Supreme Court or the NSW Trustee may also make such orders as it thinks fit in connection with authorising, directing and enforcing the exercise of the functions of managers under this Act. (3) The Supreme Court may also make such orders as it thinks fit in connection with supervising the exercise of the functions of managers under this Act. (4) An order by the NSW Trustee is subject to the regulations or to any direction by the Supreme Court or to any order of the Civil and Administrative Tribunal (in the case of a person under guardianship). Section 65. Orders by Supreme Court and NSW Trustee as to property (1) General power. The Supreme Court or the NSW Trustee may make such orders as appear to it necessary for rendering the property and income of a managed person available for the following purposes: (a) the payment of the debts and engagements of, and otherwise for the benefit of, the person, (b) the maintenance and benefit of the family of the person, (c) otherwise as it thinks necessary or desirable for the care and management of the estate of the person. (2) Orders as to disposal of estate. Without limiting the generality of subsection (1), the Supreme Court or the NSW Trustee may order that any property of the person be sold, mortgaged, dealt with or disposed of as the Court or the NSW Trustee thinks most expedient for the purpose of raising or securing or repaying with or without interest money which is to be or which has been applied to any one or more of the following purposes: (a) payment of the person's debts or engagements, (b) discharge of any encumbrance on property of the person, (c) payment of any debt or expenditure incurred for the maintenance (including future maintenance), or otherwise for the benefit, of the person, (d) payment of the costs of any proceeding under this Act or of any sale or other disposition made under this Act, (e) payment of such other sum or sums to such person or persons as the Court or the NSW Trustee thinks fit. (3) Orders as to application of money. Without limiting subsection (1), the Supreme Court or the NSW Trustee may authorise and direct the application of money comprising the whole or any part of the estate of the person to any one or more of the following purposes: (a) the preservation and improvement of the estate of the person, (b) the taking up of rights to issues of new shares, or options for new shares, to which the person may become entitled by virtue of any shareholdings, (c) the investment of money, being money not required for the time being for any of the other purposes specified in this subsection, in such manner as the Court or the NSW Trustee thinks fit. (4) An order by the NSW Trustee is subject to the regulations or to any order of the Supreme Court or to any order of the Civil and Administrative Tribunal (in the case of a person under guardianship). Section 66. NSW Trustee may authorise and direct functions of other managers (1) The NSW Trustee may, by order: (a) authorise a manager to have all, or any specified, functions necessary and incidental to the management and care of an estate and such other functions as the NSW Trustee may direct or authorise the manager to have or exercise, and (b) give a manager such directions in respect of the orders, authorities and directions authorised by this subsection as the NSW Trustee thinks fit. (2) Without limiting any other provision of this Division, the NSW Trustee may authorise a manager to have functions of a kind specified in section 16. (3) An order by the NSW Trustee is subject to the regulations or to any order of the Supreme Court or to any order of the Civil and Administrative Tribunal (in the case of a person under guardianship). (4) This section is in addition to sections 64 and 65." 44Section 16 enumerates specific powers of the NSW Trustee relating to property and the conduct of proceedings. 45Sections 64-65 have been recognised as broad, purposive powers serving the protective jurisdiction: RL v NSW Trustee and Guardian (2012) 84 NSWLR 263 at 284 [93]-[94]. There is no reason to suppose that s 66 should be viewed differently. 46These provisions are broad enough to enable the substantive concept underlying s 71 to be adapted so as to allow a substantial degree of autonomy to the plaintiff, in consultation with the defendant and her father-in-law, in management of the family home. They do not countenance a general delegation of a manager's powers, duties and functions; but they do permit a manager (under the administrative direction of the NSW Trustee and, ultimately, under the supervision of the Court) to order the business of management in a way that permits the family of a protected person to exercise autonomy under regulatory oversight. 47Particular notice should be taken of s 65(1)(b), in conjunction with the principles enunciated by Dixon J in Countess of Bective v Federal Commissioner of Taxation (1932) 41 CLR 417 at 420-423 (with emphasis added): "... an obligation to apply moneys in the maintenance of children or others does not involve the liability which arises from an ordinary trust. It is a general rule that guardians of infants, committees of the person of lunatics and others who are entrusted with funds to be expended in the maintenance and support of persons under their care are not liable to account as trustees. They need not vouch the items of their expenditure, and, if they fulfil the obligation of maintenance in a manner commensurate with the income available to them for the purpose, an account will not be taken. Often the person to be maintained is a member of a family enjoying the advantages of a common establishment; always the end in view is to supply the daily wants of an individual, to provide for his comfort, edification and amusement, and to promote his happiness. It would defeat the very purpose for which the fund is provided, if its administration were hampered by the necessity of identifying, distinguishing, apportioning and recording every item of expenditure and vindicating its propriety. Although these considerations furnish an independent foundation for the general rule yet, after all, it is a doctrine regulating the application of moneys payable under an instrument, whether a will, a settlement or an order of a Court of equity, and the operation of the doctrine must depend upon the provisions contained in the instrument, both express and implied. But the effect of the instrument will often be governed by the circumstances to which it was intended to apply, and, in particular, by a consideration of the nature of the actual abode, the condition of the household and the state of the family of the infant or other person to be maintained. Courts of equity have not disguised the fact that the general rule gives to a parent or guardian dispensing the fund an opportunity of gaining incidental benefits, but the nature and extent of the advantages permitted must depend peculiarly upon the intention ascribed to the instrument. ... A guardian is not permitted to receive moneys for maintenance without liability to account except upon the condition that he discharges his duty adequately to maintain and not otherwise. Upon his default the Court will administer the fund or intercept the payments and has jurisdiction to order an account or an inquiry... . Where, however, the condition is performed the Court does not inquire whether the moneys has been completely expended or whether the recipient has spent small sums for his personal benefit but, nevertheless, it remains an allowance to a person in a fiduciary capacity and for a definite purpose." 48Section 65(1)(b) is not the only provision of the NSW Trustee and Guardian Act bearing upon recognition that provision may need to be made from a managed estate for the benefit of a protected person's family. Section 73 empowers the NSW Trustee to authorise payments from an estate for the provision of maintenance and other necessary requirements of a managed person or his or her family pending orders being made as to management of the estate. 49The protective jurisdiction, generally, is parental and protective. It exists for the benefit of the person in need of protection, but it takes a large and liberal view of what that benefit is, and will do on behalf of a protected person not only what may directly benefit him or her, but what, if he or she were capable of managing his or her own affairs, he or she would as a right minded and honourable person desire to do: Theobald, Law Relating to Lunacy (1924), p 380. 50Having regard to the nature and purpose of the protective jurisdiction, the general principles enunciated in s 39, the importance attached to the family of a managed person in s 65(1)(b) and the general observations of Dixon J about the standard of accounting required of a fiduciary in the context of protected estate management, the third element of the "Additional Direction" proposed by the NSW Trustee should be construed liberally rather than pedantically. The plaintiff, her husband and his father can, and should, be called upon periodically to provide a general statement of their application of protected estate funds, not (unless it is their ordinary custom in any event) a detailed set of accounting records akin to those required by law to be maintained by a trading corporation or trustee. 51I note this because, having considered their position, in light of their appearances before the Court and their engagement with the NSW Trustee, the plaintiff, her husband and his father have sent to the Court, and copied to the NSW Trustee, an email (marked as Exhibit "P3") that, in substance (but with slight variations) embraces the "Additional Direction" proposed by the NSW Trustee: "... We have decided that we wish [the licensed trustee company] to remain as financial manager of the estate of [the defendant] and accept that [the defendant's] share of the family home will remain as part of his estate. We request that an additional direction or other procedure as required be implemented to authorise [the trustee company to do] the following: ● That an annual budget be submitted to the NSW Trustee and Guardian, detailing the costs of the upkeep and the daily running costs associated with the family home. ● That [the trustee company] be authorised upon receipt of written approval from NSW Trustee and Guardian, to pay the plaintiff and defendant a lump sum in advance for the defendant's annual share of such costs associated with the maintenance, rates, taxes, corporate body fees, insurance, repairs and running costs as may be required. ● [The trustee company] to require from the plaintiff and defendant an accounting of the funds expended on behalf of the defendant on the family home. 52I accede to this request. In formal legal terms, the plaintiff withdraws her application for an exclusion order (or, expressed differently, for partial administration orders) under, or by reference to, s 40 of the NSW Trustee and Guardian Act, and, instead, applies for directions in relation to management of the defendant's estate under the existing management orders. As the wife of the defendant, in a long established and close, loving relationship, the plaintiff has "a sufficient interest" in the due management of the defendant's estate to apply for such directions: cf, Re W and L (Parameters of Protected Estate Management Orders) [2014] NSWSC 1106 at [90]-[94]. 53I propose, accordingly, formally to dismiss the plaintiff's application for a variation of the existing management orders and, formally, to make an order (subject to further orders of the Court or directions of the NSW Trustee) in substantially the same terms as those requested. No orders are made as to the costs of the application. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 28 October 2014