Civil and Administrative Tribunal New South Wales Medium Neutral Citation: ZDU v ZDV [2017] NSWCATAP 197 Hearing dates: 25 May 2017 Date of orders: 03 October 2017 Decision date: 03 October 2017 Jurisdiction: Appeal Panel Before: M Schyvens, Deputy President C Fougere, Principal Member M Bolt, General Member Decision: (1) The appeal is allowed. (2) The financial management order made by the Tribunal on 21 November 2016 is set-aside. (3) The application of ZDV requesting the Tribunal make a financial management order in respect of ZDU is dismissed. (4) The NSW Trustee and Guardian is directed to pay over the estate under management to ZDU. Catchwords: APPEAL – Civil and Administrative Tribunal (NSW) – Guardianship Division – internal appeal – application for financial management – question of law – procedural fairness – failure to apply the correct statutory test – s 25G of the Guardianship Act – appeal allowed – application dismissed FINANCIAL MANAGEMENT – statutory test to determine incapacity – role of the general principles in s 4 of the Guardianship Act Legislation Cited: Anti-Discrimination Act 1977 (NSW), ss 33, 47, 49ZP Civil and Administrative Tribunal Act 2013 (NSW), ss 38, 38(5)(a), 38(5)(c), 80(2)(b) Guardianship Act 1987 (NSW), ss 3F(4)(e), 3F(5)(b)-(d), 3F(5)(d), 4, 4(a)-(f), 25G, 25G(b)-(c), 25M, Pt 3A Cases Cited: P v NSW Trustee and Guardian [2015] NSWSC 579 WL v NSW Trustee and Guardian [2011] NSWADTAP Re R [2000] NSWSC 886 Texts Cited: Nil Category: Principal judgment Parties: ZDU (Appellant) ZDV (First Respondent) NSW Trustee and Guardian (Second Respondent) ZEF (Third Respondent) Representation: M Seymour (Appellant) J Emmett (First Respondent) No Appearance (Second Respondent) M Seymour (Third Respondent) File Number(s): AP 17/04494 Publication restriction: Under s 64(1)(a) of the Civil and Administrative Tribunal Act 2013, publication of the names of the parties, other than the NSW Trustee and Guardian, is prohibited. A reference to the name of a person includes a reference to any information, picture or any other material that identifies the person or is likely to lead to the identification of the person. Decision under appeal Court or tribunal: NSW Civil and Administrative Tribunal Jurisdiction: Guardianship Division Citation: Not applicable Date of Decision: 21 November 2016 Before: A Giurissevich, Senior Member, C Pratten, Senior Member, P Foreman, General Member File Number(s): C/63239 reasons for decision Introduction 1. This is an appeal of orders made by the Guardianship Division of the NSW Civil and Administrative Tribunal (the Tribunal) on 21 November 2016 when the Tribunal made a financial management order appointing the NSW Trustee and Guardian to manage the estate of ZDU. 2. ZDU appealed the Tribunal's decision and a hearing into the appeal was conducted by an Appeal Panel of the Tribunal on 25 May 2017. 3. We have concluded that the appeal should be allowed, that the financial management order made by the Tribunal on 21 November 2016 be set-aside, and that the application of ZDV requesting the Tribunal make a financial management order in respect of ZDU be dismissed. Decision under Appeal 1. ZDU is 29 years of age and resides in an outer suburb of metropolitan Sydney with his partner, ZEF. The Tribunal understands that ZDU previously resided in Melbourne, Victoria, but has been living in Sydney with ZEF for approximately five years. 2. On 25 July 2016, the Tribunal received an application from ZDV, a clinical neuropsychologist, requesting that the Tribunal make a financial management order in relation to ZDU's estate. In a letter to the Tribunal dated 19 July 2016 attaching the application, ZDV stated: [ZDU] is a 27 year old gentleman with a history of intellectual disability. His family live in Melbourne. He currently lives with his partner ZEF in [a suburb of Sydney] NSW. [ZEF] is also his carer. [ZEF] brought [ZDU] to [referring neurologist] due to concerns about his memory and possible dementia. [Referring nuerologist] referred [ZDU] to me for a neuropsychological assessment. During the assessment [ZEF] informed me that he had also sought the assessment because he and [ZDU] have made an application to access [ZDU]'s superannuation. My assessment confirmed that [ZDU] has an intellectual disability. I also assessed his financial ability and am of the opinion that this requires independent management. I have no evidence that [ZDU] is being financially abused. My reason for seeking a review from the Tribunal is due to concerns expressed by [ZDU]'s family (Mother and sister) relating to his financial management. I have not been provided with any other family views to further support or refute the concerns expressed by ZDU's mother and sister. Due to the conflict, I am of the opinion that the matter requires independent review. 1. In support of her application ZDV filed several assessment reports authored by her and her referring neurologist. ZDU and ZEF filed a copy of an enduring power of attorney executed on 2 August 2016 in which ZDU appointed ZEF as his attorney. They also filed documents ZDU had received from BT Funds Management Limited in relation to a total and permanent disablement insurance claim. At the hearing, ZDU tendered a handwritten statement outlining his expenses together with a statement from an entity known as "Cash Stop" indicating he had a loan with that entity, the original amount borrowed being $2,000. 2. The Tribunal scheduled a hearing into ZDV's application for 21 November 2016 and issued notices advising of the hearing on 3 November 2016. Notices were issued to the parties to the proceedings, namely ZDU, ZEF, ZDV, and the NSW Trustee and Guardian, as well as to ZDU's mother and sister, and the neurologist who had referred ZDU to ZDV. 3. The hearing proceeded as scheduled on 21 November 2016. The reasons for decision for that hearing recorded that the only attendees were ZDU, ZEF, and ZDV who all attended in person. 4. At the conclusion of the proceedings, the Tribunal announced that it had decided to order that ZDU's estate be the subject of a financial management order under the management of the NSW Trustee and Guardian. The Tribunal subsequently proceeded to issue written reasons for its decision on 23 December 2016. The Tribunal did not order that the financial management order should be reviewed. This meant that the financial management order would remain in place indefinitely unless at some later point in time the Tribunal reviewed and varied the order upon being requested to do so by ZDU or someone with a genuine concern for ZDU. Notice of Appeal and interlocutory matters 1. ZDU filed a Notice of Appeal dated 25 January 2017 which was received by the Tribunal on the same date. In that Notice, ZDU outlined the grounds of appeal and sought orders that the appeal be allowed, that the decision of the Tribunal made on 21 November 2016 be set aside, and the application for the appointment of a financial manager be dismissed. 2. A directions hearing was conducted on 14 February 2017 during which ZDU was granted leave to be legally represented in the proceedings and directions were made to the parties as to the timetable for compliance of the filing of any evidence, submissions, or transcript upon which it was sought to rely. 3. On 16 March 2017, the NSW Trustee and Guardian advised the Tribunal by letter that it did not wish to present a case in the proceedings and would not make any submissions. 4. On 24 April 2017, ZDV filed submissions in reply to the grounds of appeal and the orders sought. 5. A further directions hearing was conducted on 27 April 2017 and directions were made varying the timetable for compliance for the filing and exchange of documents, and the hearing of the appeal was listed for 25 May 2017. 6. On 15 May 2017, ZDU's legal representative filed a bundle of documents which included: an amended attachment to the Notice of Appeal; an informal transcript of the hearing the subject of the appeal; statutory declarations by ZEF and Ms Melissa Coveney (solicitor assisting ZDU); and letters authored by ZDU and ZDU's general practitioner. The amended attachment to the Notice of Appeal made amendments to the grounds of appeal. In addition to the orders sought in the original attachment filed with the Notice of Appeal, ZDU also sought orders that ZDV be ordered to pay the costs of ZDU and ZEF. At the appeal hearing, ZDU, through his counsel, abandoned the request for a costs order against ZDV. In addition, there was no objection to the contents of the informal transcript submitted on behalf of ZDU. 7. ZDV filed further submissions on 18 May 2017 in reply to the bundle of documents filed by ZDU's legal representative on 15 May 2017, and on 23 May 2017 the Tribunal received a request from the Crown Solicitor of NSW to represent ZDV in the proceedings. 8. Upon the commencement of the appeal proceedings, counsel for ZDU advised that he also sought leave to represent ZEF in relation to those grounds of appeal that asserted that the hearing process was procedurally unfair to ZEF. No one objected to this request by counsel and we granted the leave requested. Similarly, counsel for ZDU and ZEF advised there was no objection to ZDV being legally represented and we granted the leave requested. 9. We ascertained with the assistance of both counsel that we had before us all documentary evidence that was available to the Tribunal below. 10. We were also in possession of written submissions on the appeal grounds provided by counsel for the appellant. ZDV also provided submissions to us on the appeal grounds. ZDV noted in her submissions that she was not responding to the points of law raised in the grounds of appeal, but rather, as a clinician, offered "clinical points" to assist in the appeal process. We did not receive written submissions from counsel for ZDV, but rather oral submissions during the appeal hearing. 11. In addition to the parties' submissions, counsel for the appellant also provided us with affidavits and correspondence which came into existence after the Tribunal made the order the subject of the appeal. These documents are described later in these reasons at [65]. Whilst there was no objection to these documents being considered by us in the course of the appeal, we understood that they had not been submitted in support of the appeal grounds, but rather, for our consideration in the event that we allowed the appeal and decided to either rehear the application or make orders in substitution. 12. Counsel for ZDU and ZEF confirmed that the amended grounds of appeal consisted of the following grounds and it was asserted that each ground raised a question of law and accordingly did not require leave: 1. The decision was determined by asking the wrong question or in failing to address the relevant statutory issue; 2. The Tribunal erred in making findings of fact unsupported by evidence; 3. The Tribunal took into account irrelevant considerations; 4. The Tribunal did not take account of relevant considerations; 5. The Tribunal failed to provide proper reasons for its decision; 6. The Tribunal denied ZDU and ZEF procedural fairness. 1. A further two grounds to be advanced if we granted leave were framed as follows: 1. There was no proper basis established on the evidence for an order to be made and, as there is no continuing basis for the maintenance of such an order, including by reference to fresh evidence that the NSW Trustee and Guardian has allowed ZDU to fall into arrears in respect of an account that he had previously shown he could maintain, the order should be revoked as an exercise of the appellate jurisdiction; 2. There is a sufficient concern that the Tribunal may have acted contrary to ss 33, 47, or 49ZP of the Anti-Discrimination Act 1977 (NSW) that the Appeal Panel should exercise its own view of the totality of the evidence concerning whether an order ought to have been or ought to be made. This concern arises from the failure by the Tribunal to give any consideration to the long-term de facto relationship between ZDU and ZEF which is inexplicable in a jurisdiction in which such support is a directly relevant consideration. Further, the hostile findings against ZEF in the absence of any fair procedure supporting such findings raises further concerns regarding the process of evidence-gathering and fact-finding that the Appeal Panel should conduct its own hearing into the merits of the decision. Right of Appeal 1. A party's right to appeal against decisions and orders of the present kind is restricted to 'questions of law'. It may be extended to 'other grounds' with the leave of the Appeal Panel. See Civil and Administrative Tribunal Act 2013 (NSW) (the CAT Act), s 80(2)(b). 2. There are time limits within which a Notice of Appeal must be filed. We were satisfied that the Notice of Appeal in this matter was filed within the requisite time period. Applicable Law 1. When deciding whether to make a financial management order, the Tribunal is under a duty to give consideration to the general principles set out in s 4 of the Guardianship Act 1987 (NSW) (the Act) (the general principles): 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. 1. The making of financial management orders is subject to detailed regulation by Part 3A of the Act. Of relevance to the issues raised by the appeal is s 25G of the Act which provides: 25G Grounds for making financial management order The Tribunal may make a financial management order in respect of a person only if the Tribunal has considered the person's capability to manage his or her own affairs and is satisfied that: (a) the person is not capable of managing those affairs, and (b) there is a need for another person to manage those affairs on the person's behalf, and (c) it is in the person's best interests that the order be made. Submissions and Consideration Application of the wrong statutory rest and the role of the general principles (Grounds 1, 4, and 5) 1. Much of the submissions made on behalf of ZDU, both filed prior to the hearing, and in oral submissions, centred around the role of the general principles and whether the Tribunal had taken adequate steps to have regard to these principles. The appellant raised this issue in relation to three grounds of appeal: that the Tribunal addressed the wrong statutory question; that the Tribunal failed to take account of relevant considerations; and that the Tribunal failed to give adequate reasons. Given this overlapping thread, it is useful to address these three appeal grounds collectively. Submissions 1. The appellant drew our attention to those sections of the reasons for decision where the Tribunal outlined the test that needed to be applied in determining whether ZDU was incapable of managing his affairs: 8. The test for determining a person's capability to manage his or her affairs has been described as follows (P v NSW Trustee and Guardian [2015] NSWSC 579, [307]-[308]): Is a person reasonably able to manage his or her own affairs in a reasonably competent fashion, without the intervention of a [financial manager] charged with a duty to protect his or her welfare and interests? … [A] focus for attention is whether the person is able to deal with (making and implementing decisions about) his or her own affairs (person and property, capital and income) in a reasonable, rational and orderly way, with due regard to his or her present and prospective wants and needs, and those of family and friends, without undue risk of neglect, abuse or exploitation. 9. In considering whether the person is "able" in this sense, consideration may be given to: - past and present experience as a predictor of the future course of events; - support systems available to the person; and - the extent to which the person, placed as he or she is, can be relied upon to make sound judgments about his or her welfare and interests: see Lindsay J in CJ v AKJ [2015] NSWSC 498 [38], and P v NSW Trustee and Guardian [2015] NSWSC 579 [309]. 1. Counsel for ZDU argued that despite outlining this test, the Tribunal proceeded to apply a different test in its determination, focussing disproportionately upon the modest debt that ZDU had accumulated and reaching a conclusion that the debt would never be repaid unless an order was made, rather than having due regard to ZDU's actual decision-making capacity by having regard to his history of self-determination in terms of his financial affairs. The appellant relied upon the following extracts of the reasons for decision to advance this position: 14. In the Tribunal's view [ZDU]'s evidence on the day of this hearing was entirely consistent with the assessment of [ZDV] above. He appeared to have no "rational appreciation" of his assets and liabilities and repeatedly deferred to and sought assistance from [ZEF] when asked questions by the Tribunal. As noted by [ZDV] in the second paragraph quoted above [ZDU] had told her that he relies on [ZEF] to manage all aspects of his finances and that prior to moving to Sydney he had relied on his mother to manage his finances. 15. The Tribunal asked [ZDU] a number of questions about the application and the management of his finances. As already noted, almost invariably he would defer to [ZEF] to assist him with an answer. He himself had very limited appreciation of the details of his financial affairs. He did not know how much he was receiving from his DSP but he did say that it was used to pay the household expenses and bills which were shared. … 19. [ZDU] handed up to the Tribunal (via [ZEF]) a one page hand written document titled "Expenses" which set out various amounts for power $25, Foxtel $63, House Phone $65, Mobile Phone $90, Loan $130, and food $60.Those amounts did not state whether they were weekly or monthly. On the Tribunal's calculation the monthly total for these payments is around $800 because the payment of $130 for the loan (Cash Stop) is fortnightly so per month would be around $290. Similarly food allowance of $60 appears to be [ZDU]'s stated weekly contribution which would be around $270.00 monthly. The rudimentary document does not purport to be a budget as it shows no income against outgoings. In the third last paragraph it states that [ZDU] does well with his [bank] account and that he is saving for a cruise in 2018. When the Tribunal asked him how much he had in the [bank] account he replied that it was less than a dollar. When the Tribunal asked him how much he had saved for the cruise he was unable to specify an amount and could not say where those savings were. ... 22. Having regard to all of the available evidence the Tribunal was ultimately in no doubt that [ZDU] is incapable of managing his financial affairs. 23. The Tribunal relied on the factual evidence obtained at this hearing and referred to above and the professional assessment reports from [ZDV] to reach this conclusion. 1. Counsel for the appellant also drew our attention to certain exchanges in the informal transcript of the hearing, such as the following, which he argued exhibited the Tribunal's fixation on a particular debt issue to determine ZDU's incapacity rather than apply the more holistic approach required: [ZEF]: He can handle his own finances. I don't interfere in those. [Presiding Member]: But to me, sorry [ZEF], I've got to disagree with that because to me, as I said before, someone that's on a disability pension ah…that falls into a hole with at $3,000 debt…over $3,000 because there's Centrelink as well… [ZEF]: Mmmm. [Presiding Member]: He's never going to get out of that hole because it's just impossible. To me his financial affairs seem to be in a little bit of disarray. I mean his financial affairs aren't complex. He only gets the pension. 1. The appellant further submitted that the Tribunal failed to take account of a relevant consideration, arguing that the general principles amount to mandatory considerations and that the reasons for decision did not provide any considered analysis of the application of those general principles to the proceedings. It was submitted that such failure also brought the Tribunal into error by failing to provide adequate reasons as to how the general principles were applied in the determination process. 2. In oral submissions, counsel for ZDV stated that the Tribunal did have sufficient regard to the general principles, that the general principles do not amount to mandatory considerations as submitted by counsel for the appellant, and any failure by the Tribunal to explicitly list and address any of the general principles does not mean that they were not considered by the Tribunal to the extent that they were relevant to the facts of the case. Consideration 1. It is not correct to state that the Tribunal was not alive to the existence of the duty upon it to apply the general principles in its determination process. It referred to those general principles towards the conclusion of the reasons for decision when addressing the issue of who to appoint as ZDU's financial manager: Who should be financial manager? 16. In appointing a financial manager, as in making all other orders under the Guardianship Act 1987 (NSW) ('the Guardianship [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 Guardianship Act. 17. Section 25M of the Guardianship 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. 18. [ZDV] was proposing the appointment of the NSW Trustee [and Guardian] as an independent professional financial manager. 19. [ZDU] and [ZEF] were opposed to any order being made on the basis that there was no need for an order. [ZEF]'s position was that as he now held a power of attorney he could manage the affairs if there was a need for him to do so. They both asserted that [ZDU] was managing his own finances. As indicated above the Tribunal does not accept that assertion. 20. In the Tribunal's view [ZDU]'s current financial predicament has arisen whilst [ZDU]'s financial affairs have been under the care and control of [ZEF]. [ZDU] had reported to [ZDV] that [ZEF] attended to all financial matters on his behalf. It was manifestly apparent to the Tribunal that [ZEF] was not a suitable person for the role of financial manager. 24. The Tribunal was therefore satisfied that [ZDU]'s financial affairs should be committed to the NSW Trustee and Guardian. 1. The appellant raised associated matters as to the statutory test applied by the Tribunal in arriving at its decision to make an order. However, in our view, the central question for us is to determine was whether the Tribunal applied the general principles as relevant in this manner in its determination process which led it to conclude that ZDU's estate should be managed by the NSW Trustee and Guardian. 2. In the matter of WL v NSW Trustee and Guardian [2011] NSWADTAP, her Honour, Hennessey LCM, made the following observations as to the role of the general principles in proceedings to determine applications under the Act: 71. Section 4 is more than an objects clause. Objects clauses articulate the intended purpose of the legislation and regard may be had to them to resolve uncertainty or ambiguity when interpreting and applying the remainder of the legislation: Minister for Urban Affairs and Planning v Rosemount Estates Pty Ltd (unreported, 90640127, 14 August 1996). The 'principles clause' in the Guardianship Act not only articulates the intended objects of the Act, it requires any person exercising functions under that Act, to observe those principles. 72. A somewhat similar provision exists in the Children (Detention Centres) Act 1987 (CDC Act). In particular, as with s 4(a) of the Guardianship Act, s 4(2)(a) of that Act, requires that: (2) In the administration of this Act: (a) the welfare and interests of persons on remand or subject to control shall be given paramount consideration 73. Section 4 of the CDC Act has other similarities with s 4 of the Guardianship Act. One of the objects of the former provision is to "ensure that persons on remand or subject to control take their places in the community as soon as possible as persons who will observe the law": s 4(1)(a). That provision expresses similar aspirations to those expressed in s 4(b), (c) and (f) of the Guardianship Act. 74. In the context of the review of a decision to transfer juvenile detainees under the CDC Act, the Supreme Court (Johnson J) held that the extent of the consideration to be given to an objects clause depends on the adverse consequences of the relevant decision under the Act on the applicant and the statutory scheme: ID, PF and DV v Director General, Department of Juvenile Justice and Anor [2008] NSWSC 966. In that case, the potential effect of a prison transfer on the defendants was serious enough that the 'decision maker was bound to have regard to the objects in s 4 CDC Act , and the practical matters, concerning each Plaintiff which arose for consideration once proper regard was had to the objects clause': at [262]. In such circumstances, the objects must either be taken into account expressly or the decision must demonstrate that those objects were in fact taken into account: at [263]. 75. Similarly, in relation to the Guardianship Act, when making a decision about whether to revoke a financial management order, or to exercise any other function under the Guardianship Act, a decision maker is bound to observe any relevant principle in s 4. The decision maker may demonstrate that he or she has observed those principles either by referring to them expressly or by writing reasons for decision which demonstrate that all relevant principles have been observed. 1. Subsequently, Lindsay J in the matter of P v NSW Trustee and Guardian [2015] NSWSC 579, considered the relationship between the objects and principles contained within both the Act and the CAT Act, and of particular relevance to this appeal, described the role that the general principles have to play when a decision needs to be made whether to exercise the discretion in s 25G of the Act to make a financial management order: 56. The expression "with respect to" in the introductory words of section 4 is sufficient to require an application for a financial management order under section 25E of the Guardianship Act, or an application for an interim financial management order under section 25H of the Act, to be informed by the general principles set out in section 4 even if, ultimately, the Court finds that the respondent to the application is not, in fact, a "person who has a disability" within the meaning of section 3(2): CJ v AKJ [2015] NSWSC 498 at [44]-[48]. The Guardianship Act should be construed beneficially, having regard to its protective character: Protective Commissioner v D (2004) 60 NSWLR 513 at 543 [167]. As mandated by section 33 of the Interpretation Act1987 NSW, the Court should construe the Act in a manner designed to promote its beneficial, protective purpose. That requires that section 4 be construed as informing consideration of an application for a financial management order in all eventualities. 57. This construction may be reinforced by reference to the Civil and Administrative Tribunal Act, Schedule 6, clause 5(1). 58. The attention of the Guardianship Division of NCAT is specifically drawn to the general principles set out in section 4 of the Guardianship Act by the interrelationship between that Act and the Civil and Administrative Tribunal Act, particularly Schedule 6, clause 5(1). 59. The jurisdiction to make a financial management order under the Guardianship Act is specifically, expressly conferred on NCAT. The functions of NCAT in relation to the Guardianship Act (as well as in relation to the NSW Trustee and Guardian Act and the Powers of Attorney Act 2003 NSW) are allocated to the Guardianship Division of the Tribunal by the Civil and Administrative Tribunal Act, Schedule 6, clause 3 (1). 60. Clause 5 of Schedule 6 provides as follows: "5. Certain principles under Guardianship Act 1987 to be applied (1) The Tribunal, when exercising its Division functions for the purposes of the Guardianship Act 1987 in relation to persons who have disabilities, is under a duty to observe the principles referred to in section 4 of that Act. Note: Section 4 of the Guardianship Act 1987 sets out principles that everyone must observe when exercising functions under that Act with respect to persons with disabilities. (2) The provisions of this clause are in addition to, and do not limit, the provisions of section 36 (5) of this Act." 61. Section 36 of the Civil and Administrative Tribunal Act is in the following terms: "36. Guiding principle to be applied to practice and procedure (1) 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. (2) The Tribunal must seek to give effect to the guiding principle when it: (a) exercises any power given to it by this Act or the procedural rules, or (b) interprets any provision of this Act or the procedural rules. (3) Each of the following persons is under a duty to co-operate with the Tribunal to give effect to the guiding principle and, for that purpose, to participate in the processes of the Tribunal and to comply with directions and orders of the Tribunal: (a) a party to proceedings in the Tribunal, (b) an Australian legal practitioner or other person who is representing a party in proceedings in the Tribunal. (4) In addition, the practice and procedure of the Tribunal should be implemented so as to facilitate the resolution of the issues between the parties in such a way that the cost to the parties and the Tribunal is proportionate to the importance and complexity of the subject-matter of the proceedings. (5) However, nothing in this section requires or permits the Tribunal to exercise any functions that are conferred or imposed on it under enabling legislation in a manner that is inconsistent with the objects or principles for which that legislation provides in relation to the exercise of those functions." 62. The effect of section 36(5) and Schedule 6 clause 5 is to confirm the centrality of section 4 (read with section 3(2)) of the Guardianship Act in the exercise by the Guardianship Division of NCAT of the jurisdiction conferred upon it relating to the making of financial management orders. … 207. The several paragraphs of section 4 inform the evaluative decision making required by reference to section 25G. It is not literally correct to regard them as a checklist, to be applied formalistically, but they provide important points of reference. They must not be elevated to such an extent that they are taken as a substitute for the primary concept of incapacity for self-management, which is the main focus of section 25G, but they may provide substantial guidance as to the meaning and application of the concept. … 311. Any attempt to summarise the elements of a finding as to whether a person is or is not "capable of managing his or her own affairs" without consulting the terms of the legislation (including each of the paragraphs of section 4, not merely those here selected for particular notice) is likely to be imperfect. The terms of the legislation must be viewed holistically, and bearing in mind that that the concept of "capability" is directed to the reasonably foreseeable future as well as to the present time... 1. The reasons for decision for the orders the subject of this appeal include a reference to the general principles only in relation to the issue of who to appoint as the manager of ZDU's estate. There is no reference, or application of the concepts contained therein, to the general principles in the Tribunal's reasoning for deciding that ZDU was incapable of managing his financial affairs or to otherwise exercise the discretion under s 25G of the Act to make a financial management order. 2. An analysis of the Tribunal's written reasons lead us to agree with the submissions advanced by counsel for ZDU that in determining whether or not to make the order, there was a disproportionate focus by the Tribunal upon ZDU's modest liabilities, which on the evidence available, was in the vicinity of $2,000 to $3,000, rather than the application of a broader analysis of the evidence. 3. In analysing the evidence to determine the statutory criteria set out in s 25G of the Act, there were certain factual matters that the Tribunal should have evaluated and balanced through the prism of relevant principles contained within s 4 of the Act. 4. First, ZDU is a relatively young man, only 28 years old as at the time of the hearing. There was evidence that he has previously been in gainful employment. Up until the orders were made, he had been free to manage his own affairs. In determining the issue of ZDU's capability and whether to make a financial management order, these circumstances required the Tribunal to consider not only his welfare and interests (s 4(a) of the Act), but also that he should be encouraged, as far as possible, to live a normal life in the community (s 4(c) of the Act), and that he should be encouraged, as far as possible to be self-reliant in matters relating to his financial affairs (s 4(f) of the Act). There was no explicit reference to these considerations in the Tribunal's reasons. Nor have we been able to find any implicit reference to these considerations in the Tribunal's reasons that would otherwise "demonstrate that all relevant principles have been observed" (WL v NSW Trustee and Guardian at [75]). Consequently, we have concluded that the Tribunal failed to turn its mind to such considerations. 5. Second, the evidence indicated that ZDU and ZEF had been in a spousal relationship for approximately five years as at the time of the hearing. No one disputed that this was the case. Both ZDU and ZEF made clear submissions to the Tribunal that they did not support the making of a financial management order. In determining the issue of ZDU's capability and whether to make a financial management order, these circumstances required the Tribunal to consider not only his welfare and interests (s 4(a) of the Act), but also his views that no order be made (s 4(d) of the Act), and the importance of preserving his family relationship with ZEF (s 4(e) of the Act). Again, there was no explicit reference to these considerations in the reasons and we are not satisfied that the reasons demonstrated that the Tribunal turned its mind to such considerations. 6. Third, the orders made by the Tribunal meant that ZDU's entire estate became the subject of management indefinitely and the primary finding of fact upon which the Tribunal relied for reaching this conclusion was that ZDU had liabilities in the vicinity $2,000 to $3,000. In these circumstances, the Tribunal needed to consider how the order made took account of ZDU's freedom of decision and freedom of action which should be restricted as little as possible (s 4(b) of the Act). There is no indication that the Tribunal did so. 7. We conclude that the Tribunal failed to apply the correct statutory test in analysing the available evidence and consequently decided to make a financial management order over ZDU's estate. The Tribunal failed to give consideration to the relevant general principles in the Act which were central to the factual matters in the proceedings and erred in doing so. Ground 1 is established. Given this, we did not need to form a concluded view about grounds 4 and 5. Procedural Fairness (Ground 6) 1. Counsel for ZDU submitted that the Tribunal denied ZDU and ZEF procedural fairness in making adverse findings regarding the evidence that they gave to the Tribunal without putting either of them on notice of the potential for such findings to be made and the potential consequences if such findings were made. Further, it was argued that the Tribunal denied ZEF procedural fairness by making adverse findings regarding his character without providing notice for the potential for such a finding to be made. 2. Counsel for ZDV submitted that there had been no denial of procedural fairness to either ZDU or ZEF. He argued that the contents of ZDV's reports to the Tribunal, which were in the possession of ZDU and ZEF prior to the hearing, put both parties on notice that their abilities and actions in managing financial affairs would be in focus during the course of the hearing. Consideration 1. As provided in s 38 of the CAT Act, the Tribunal is required to comply with the rules of procedural fairness: 38. Procedure of Tribunal generally … (2) The Tribunal is not bound by the rules of evidence and may inquire into and inform itself on any matter in such manner as it thinks fit, subject to the rules of natural justice. … (5) The Tribunal is to take such measures as are reasonably practicable: (a) to ensure that the parties to the proceedings before it understand the nature of the proceedings, and (b) if requested to do so—to explain to the parties any aspect of the procedure of the Tribunal, or any decision or ruling made by the Tribunal, that relates to the proceedings, and (c) to ensure that the parties have a reasonable opportunity to be heard or otherwise have their submissions considered in the proceedings. 1. As directed by s 38(5)(a) of the CAT Act, the Tribunal must take such measures that are reasonably practicable to ensure that parties understand "the nature of the proceedings". Self-evidently, without such understanding, a party will be unable to make submissions about the key issues that arise for determination in the proceedings. It follows, that unless the Tribunal has complied with its obligations under s 38(5)(a) of the CAT Act, there is a risk it might also fail to comply with its obligation under s 38(5)(c) of the CAT Act to ensure that the parties have a reasonable opportunity to be heard. 2. ZDU, as the person the subject of the application, was clearly a party to the proceedings (s 3F(5)(b) of the Act). As previously noted, the unchallenged evidence before the Tribunal was that ZDU and ZEF had been in a spousal relationship for approximately five years. The Tribunal's reasons for decision described ZEF's status as a party to the proceedings as that of a carer (s 3F(5)(d) of the Act) rather than as a spouse (s 3F(4)(c) of the Act). In any event, it was clear that ZEF was also a party to the proceedings. The Tribunal was required to ensure that the proceedings were procedurally fair to both ZDU and ZEF. 3. From a review of the informal transcript of the hearing, we do not disagree with the proposition that the Tribunal failed to put ZDU or ZEF on notice that it may make negative findings in relation to the evidence that they provided and the potential consequences of such findings. However, we believe the primary cause for concern was the limited nature of the measures taken by the Tribunal to ensure that ZDU and ZEF, both unrepresented parties, understood the nature of the proceedings in which they were involved. 4. The informal transcript reveals the following explanation was provided by the presiding member in the early stages of the proceedings as to the statutory test the Tribunal needed to apply in the proceedings: [Presiding Member]: Alright. So, [ZDV] this is an application for financial management. Um....to make a financial management order we've got to make a number of factual findings firstly that a person in respect of whom the application has been made, [ZDU]... [ZDV]: Hmmm hmmm... [Presiding Member]: ...Is incapable of managing his financial affairs. Secondly, um....that there's a need to manage something and thirdly that it's in the best interests overall of the person... [ZDV]: Hmmm hmmm... [Presiding Member]: That's a very broad concept, best interests and the...the Act doesn't define what incapable means but there's a long line of cases um...which these days focus on the factual elements of a person's capabilities so that can be a relative test. You might be able to um....you know, manage a pension for example but not manage more difficult ah issues like um...seeking to um...seeking to um...complete a claim under a total and permanent disability superannuation entitlement or run a personal injury claim, instruct a solicitor, that sort of thing. So it's a relative test. Um...as I'm sure you're aware. [ZDV]: Yes. [Presiding Member]: Um...even if we find that a person is incapable sometimes we just don't make an order because there's no need. You know...what there is there to manage is being managed informally or with supports. So we've read your application. Um....we know that [ZDU]'s opposed to your application… 1. An analysis of the informal transcript reveals that at no point in the hearing did the Tribunal explain its role under s 25M of the Act that, if it concluded that it would exercise its discretion to make a financial management order in relation to the estate of ZDU, it could appoint a suitable person to manage ZDU's estate, or alternatively, commit the management of the estate to the NSW Trustee and Guardian. It was not explained to the participants that someone other the NSW Trustee and Guardian could be appointed. Further, at no point did the Tribunal expressly seek the view of any of the parties, including ZDU, as to who should be appointed. It is notable in this regard that the original applicant, ZDV, expressed no views in either her application or at the hearing as to who should be appointed if the Tribunal made a financial management order, despite the Tribunal recording to the contrary in its reasons as noted in the extract at [52] below. 2. The issue of who should be appointed as manager of ZDU's estate was subsequently addressed by the Tribunal in the written reasons for decision as follows: 17. Section 25M of the Guardianship 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. 18. [ZDV] was proposing the appointment of the NSW Trustee [and Guardian] as an independent professional financial manager. 19. [ZDU] and [ZEF] were opposed to any order being made on the basis that there was no need for an order. [ZEF]'s position was that as he now held a power of attorney he could manage the affairs if there was a need for him to do so. They both asserted that [ZDU] was managing his own finances. As indicated above the Tribunal does not accept that assertion. 20. In the Tribunal's view [ZDU]'s current financial predicament has arisen whilst [ZDU]'s financial affairs have been under the care and control of [ZEF]. [ZDU] had reported to [ZDV] that [ZEF] attended to all financial matters on his behalf. It was manifestly apparent to the Tribunal that [ZEF] was not a suitable person for the role of financial manager. 24. The Tribunal was therefore satisfied that [ZDU]'s financial affairs should be committed to the NSW Trustee and Guardian. (sic) 1. It is clear from this reasoning that the Tribunal was alive to the possibility of appointing ZDU's spouse, ZEF, as his financial manager and through its questioning during the course of the hearing obtained evidence to assist it to form a view as to his suitability for appointment, or otherwise. Unfortunately, from a review of the informal transcript neither ZDU nor ZEF were made aware of this possibility of appointment. Nor were they put on notice that the evidence they were giving during the course of the hearing would be used to form the basis of the Tribunal's assessment in regards to this element of the statutory test. 2. The particular circumstances of this matter were that: ZDU and ZEF were unrepresented; they were in a spousal relationship; and both were opposed to the making of a financial management order. Given these circumstances, the Tribunal was obliged to take reasonably practical measures to ensure that ZDU and ZEF understood the nature of the proceedings. They were obliged to take steps to ensure that ZDU and ZEF were aware that the issue of who could be appointed as ZDU's financial manager if an order was to be made was a live issue in the proceedings so that each had an opportunity to be heard on this critical matter. The Tribunal failed to do so. It did not set out the statutory criteria that it needed to consider in relation to this issue. Nor did it seek or receive submissions from any party as to who should be appointed. We are satisfied that this ground of the appeal is established. Remaining Grounds 1. The appellant also sought leave to appeal on the grounds that the Tribunal erred in making findings of fact unsupported by evidence and took into account irrelevant considerations. We were not provided with any detailed submissions on these grounds and they were not pressed at the hearing before us. Given we have concluded to allow the appeal on other grounds, it is unnecessary for us to determine these remaining grounds. 2. Similarly, it is unnecessary for us to determine whether leave to appeal should be granted in relation to the remaining grounds of appeal for which leave is required. Disposal of Appeal 1. We have concluded that in determining ZDV's application seeking appointment of a financial manager for the estate of ZDU the Tribunal erred in law, and as such, the ultimate order the Tribunal made was flawed. 2. In deciding how to dispose of this appeal we note the fact that ZDU's estate has been the subject of management by the NSW Trustee and Guardian for over 10 months. As outlined below, we had before us documents which indicated that ZDU, his general practitioner, and ZEF are of the view that the order has had a detrimental impact on his general well-being. We also had before us all of the documentary evidence that was before the Tribunal below. Taking these matters into consideration, we concluded that the most appropriate course of action was for us to set-aside the financial management order made by the Tribunal and proceed to provide a substitute decision on the application. 3. We have concluded that ZDV's application should be dismissed as we are not satisfied that the discretion to make a financial management order under s 25G of the Act should be exercised. 4. This is not to say that the evidence provided by ZDV, or the neurologist who referred ZDU to ZDV, was not credible. Their evidence indicates that ZDV does have a level of cognitive impairment which impacts upon his decision making abilities. However, even if we concluded that ZDU was incapable of managing his own affairs, the issue of incapability is only one element of which the Tribunal needs to be satisfied before it can exercise the discretion to make a financial management order. It must also be satisfied that there is a need for another person to manage the person's affairs (s 25G(b) of the Act) and that it is in the person's best interests that an order be made (s 25G(c) of the Act). We have concluded that neither of these elements of the statutory test are satisfied on the material before us when viewed through the prism of the applicable general principles. 5. One of the primary motivations for the original application was a concern on the part of ZDV that ZDU, with the assistance of ZEF, was seeking to access superannuation monies. However, the evidence before us on this matter is that ZDU does not in fact have any superannuation to seek access to and a claim upon an insurance policy associated with superannuation had been denied. There was no evidence to suggest ZDU has any reasonable prospect of challenging this denial. 6. The evidence suggests that ZDU has modest liabilities in the vicinity of $2,000 to $3,000. There is no evidence that he is in arrears in relation to any of his liabilities. 7. ZDU's most significant liability on the evidence before the Tribunal below is a loan provided to him by an entity known as "Cash Stop". The documentation before the Tribunal indicated that a loan of $2,000 had been drawn down in early September 2016 and incurred a monthly fee of $80. As at the time of the hearing, the amount owing on the loan was $1,993. There is no doubt that the terms of this loan would seem quite unfavourable to ZDU and that given his sole income is that of a disability support pension, he will need to be vigilant to ensure that this loan does not bring him into financial difficulty in the long-term. 8. However, to reach a conclusion that he will be unable to repay this loan without the imposition of a financial management order is not a conclusion supported by the evidence. It is not clear to us that an order would promote ZDU's welfare and interests in relation to this loan or any of his lesser liabilities. What is clear to us, however, is that a financial management order over the limited estate of a relatively young man in ZDU's circumstances: is against his express wishes which we have taken into consideration (s 4(d) of the Act); would disproportionately restrict ZDU's freedom of decision and freedom of action (s 4(b) of the Act)); and would not promote his autonomy or self-reliance (s 4(f) of the Act). In short, an analysis of the evidence through the prism of the general principles leads us to conclude there is no need for another person to manage ZDU's affairs. 9. We were also provided with the following documents by counsel for ZDU: 1. an undated statement signed by ZDU which said: Bill were paid on time.[sic] Bills NOW are not being paid on time, now behind with debts. Social life doesn't exist in any form. We have had on many occasions had to ask friends for assistance as there is not enough money left over for the purchase of food essentials. I am under the care of a doctor suffering depression because all I do is worry about bills not being paid and the possible additional charges for late payments. Our relationship is also suffering as we are continually arguing over money. None of the above happened before these new arrangements were put [in] place. 1. A letter authored by ZDU's general practitioner dated 22 April 2017 stated: The above [ZDU] is a registered patient of this Centre that has been hampered financially by an order placed a few months ago. We note that the lack of access to his meagre finances is further hampering ongoing depression management. There had been times where his bills are not settled and this necessitated having to source funds from family and friends.[sic] [ZDU] has capacity [to] handle his finances and should never have been subjected to court order in this regard. 1. A statutory declaration which was declared by ZEF on 4 May 2017 which stated, in part: Since the Order has been made and [ZDU]'s finances have been handed to the NSW Trustee and Guardian, [ZDU] and I have been under considerable financial stress which we were not previously under. We have had issues with the NSW Trustee and Guardian not paying [ZDU]'s phone bills on time which has lead to phone calls form the company threatening to have the phone disconnected. I know that [ZDU] is finding it difficult only receiving an [allowance] from the NSW Trustee and Guardian as he feels he cannot do many of the things he enjoyed dong prior to the Order being made. This has in turn put stress on our relationship. 1. On the basis of this material, none of which was contested, we also determined that a financial management order is not in ZDU's best interests given the negative impact on his "welfare, health and well-being" (Re R [2000] NSWSC 886 at [85], Young J). Orders We make the following orders: 1. The appeal is allowed. 2. The financial management order made by the Tribunal on 21 November 2016 is set-aside. 3. The application of ZDV requesting the Tribunal make a financial management order in respect of ZDU is dismissed. 4. The NSW Trustee and Guardian is directed to pay over the estate under management to ZDU. ********** 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 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: 03 October 2017