NSW Civil and Administrative Tribunal New South Wales Medium Neutral Citation: TZU [2019] NSWCATGD 7 Hearing dates: 27 February 2019 Date of orders: 27 February 2019 Decision date: 27 February 2019 Jurisdiction: Guardianship Division Before: G R Moin, Senior Member (Legal) C M Kennedy, Senior Member (Professional) D R Sword, General Member (Community) Decision: 1. The estate of TZU is subject to management under the NSW Trustee and Guardian Act 2009 (NSW). 2. ESI of [Address removed for publication.] is appointed as the financial manager of the estate. NOTE: The financial manager is not authorised to deal with the estate (other than to protect the assets) until he/she has obtained all necessary authorities from the NSW Trustee and Guardian. 3. This order be reviewed by the Tribunal within two years. Catchwords: FINANCIAL MANAGEMENT – application for financial management order – application made by close friend of subject person – need for an order – subject person escaped from extreme spousal abuse – subject person held as a slave by her husband FINANCIAL MANAGEMENT – role of Litigation Guardian under r 11 of the Federal Court Rules – role of Case Guardian under r 6 of the Family Law Rules – role of Financial Manager in property proceedings under Family Law Act 1975 (Cth) Legislation Cited: Guardianship Act 1987 (NSW), ss 4, 25 Family Law Act 1975 (Cth) Cases Cited: Application by AMAM; Re SAM [2011] NSWSC 503 CJ v AKJ [2015] NSWSC 498 Holt & Anor v Protective Commissioner (1993) 31 NSWLR 227 M v M [2013] NSWSC 1495 McD v McD (1983) 3 NSWLR 81 P v NSW Trustee and Guardian [2015] NSWSC 579 Texts Cited: Nil Category: Principal judgment Parties: 001: Financial Management Application TZU (the person) ESI (applicant, attorney, proposed financial manager) NSW Trustee and Guardian Representation: Nil File Number(s): NCAT 2019/00030248 Publication restriction: Decisions of the Guardianship Division of the Civil and Administrative Tribunal have been anonymised to remove any information that may identify any person involved in the Tribunal's proceedings (s 65, Civil and Administrative Tribunal Act 2013 (NSW)). REASONS FOR DECISION What we decided 1. We appointed ESI as TZU's financial manager, reviewable after two years, subject to the authorities and directions ordered by the NSW Trustee and Guardian. Background 1. TZU is a 52-year-old woman who is reported to have multiple cognitive impairments. TZU has a close friend, ESI. 2. On 21 November 2018, TZU made an enduring power of attorney appointing ESI and, in addition appointed ESI as her enduring guardian. 3. On 29 January 2019, the Tribunal received a financial management application from ESI with respect to TZU. The hearing 1. This hearing is to deal with the application filed by ESI concerning TZU. 2. The hearing was held in regional NSW at the offices of the Tribunal. 3. At the end of these Reasons for Decision are lists of the parties to the application and the witnesses who attended the hearing. [Appendix removed for publication.] Does ESI have standing to bring this application? 1. A person has standing to bring an application if he/she is: 1. the person who is the subject of the application; 2. the NSW Trustee and Guardian; or 3. any other person who, in the opinion of the Tribunal, has a genuine concern for the welfare of the person. 1. We found that ESI has standing to make the application for a financial management order. ESI is a close friend of TZU as is more fully explained in the paragraphs that follow. Facts relied on 1. Before proceeding in these Reasons for Decision to deliberate on the legal basis upon which we could make a financial management order concerning TZU, we considered that it was important to set out the facts which were told to us at the start of the hearing. These facts form the basis on which we applied the law which ultimately led to us making a financial management order. 2. The facts told to us by ESI, to which TZU agreed, in summary are as follows: * TZU is a 52-year-old woman who lives in her own rented home in a regional centre in NSW; * TZU was married at 16; * for 34 years, TZU was kept prisoner by her husband. She was treated as a slave; * while she was enslaved, TZU was forced to give birth to five children all of whom have physical and/or intellectual disabilities; * TZU was not allowed to leave the marital home unless she was in the company of her husband and was forbidden to speak; * during her marriage TZU was given no money, was not allowed to shop and was forbidden interaction with the outside world unless her husband was present; * in May 2016, TZU's husband attempted to obtain a disability support pension for TZU. This attempt necessitated TZU undergoing a Psychology Assessment Report by a Centrelink psychologist. We had a copy of the Report undertaken by the Centrelink psychologist dated 27 May 2016 ("Report"); * the Report noted that: 1. TZU did not speak during the interview; 2. all information provided in the Report was verbalised by TZU's husband or was the subject of medical reports provided by TZU's husband from her GP and neurologist; 3. TZU's husband said that his wife had an intellectual impairment, left school at 14, has been non-communicative since then, cannot read or write but can sign her name and has undertaken no training or paid work; 4. TZU has a severe intellectual disability, poor capacity to learn and is reluctant to speak; 5. TZU has no current or future work capacity due to her intellectual functioning; 6. TZU's money sense is "nil", she is "not able to perform shopping, cannot prepare food/wash up/household work"; 7. TZU has been diagnosed by a neurologist with non-epileptic attack disorder (NEAD) "as a physical manifestation of internal stress"; 8. TZU was reportedly having seizures every three days since at least 1988; 9. TZU's long-term severe intellectual disability has impacted her communication and functioning; 10. TZU does not have a capacity for independent living…due to significant and severe co-morbid impact of medical conditions; 11. TZU's severe intellectual disability renders her unable to undergo a formal cognitive assessment; 12. TZU "is unlikely to benefit from participation in any program of assistance currently, due to the severe impact of her co-morbid medical conditions on independence and functioning". * a short time after the interview with the Centrelink psychologist, TZU had to attend a gynaecological clinic; * while at the clinic, workers there helped her "escape" from her husband; * subsequently, TZU spent six months in hospital and was finally discharged to a women's refuge in the town where she now resides; * at the time of her admission to hospital, TZU did not speak; * TZU was able to speak to us at the hearing; * TZU is the respondent in Family Law Act 1975 (Cth) property proceedings initiated by her husband; * ESI is the second respondent in those proceedings; * TZU is "terrified of being in her former husband's presence"; * ESI met TZU after she was discharged from hospital two years ago when she was involved in a prison ministry program for women impacted by the imprisonment of a family member or self. ESI offered a program teaching participants to sew; * TZU wanted to learn how to sew and a friendship was struck between her and ESI; * ESI now takes TZU to church and to her doctor's appointments, outings, support groups and meals with friends; * while ESI said that there had been significant changes in TZU in the last two years, she is still falling, suffers from anxiety and talks little. ESI said that TZU does not do a great deal of cooking as she is afraid of falling into the oven or stove; * On 21 November 2018, TZU made an enduring power of attorney appointing ESI as her attorney. In addition, TZI made an instrument appointing ESI as her enduring guardian. What did we have to decide? 1. The questions to be considered by us are: * Is TZU incapable of managing her affairs? * Is there a need for another person to manage TZU's affairs and is it in her best interests for a financial management order to be made? * If so, who should be appointed financial manager? Is TZU incapable of managing her affairs? 1. In a quiet and calm manner TZU attempted to answer, as best she could, a number of questions that we asked regarding her financial affairs. TZU knew that she held a bank account with a commercial bank but did not know the balance in her account. 2. TZU knew that she received a pension but did not know the amount she received. 3. We asked TZU what she spends her money on and she replied by telling us that she does "a bit of Coles on line shopping," buys bracelets and "other things on line". When we asked TZU if she knew how much she spends and what items cost she said, "no, I just do it". 4. When we asked TZU how she would go about obtaining money from her bank account she told us that "[ESI] would take me to the bank." TZU did not know or understand how to take money from her bank. Further, upon questioning, TZU did not know how to pay her bills, saying that she calls "[ESI] and she helps me pay it". 5. When we asked TZU if she had ever lent money to anyone she said, "I've been asked but didn't know what to do and so I phoned [ESI]." 6. ESI confirmed to us that she assists TZU to obtain cash from her bank account. ESI said that TZU only likes to have $5 dollar notes and always asks for these notes from the bank tellers. 7. ESI went on to tell us that she arranges for $300 to be transferred into TZU's account on a regular basis. ESI told us that she then assists TZU to pay her accounts with electricity being her main bill. ESI and the women's refuge have put in place arrangements for TZU to pay bills such as her phone and internet charges by way of direct debit. ESI said that TZU's rent is paid automatically by Centrelink from her pension. 8. ESI's application to the Tribunal and her oral evidence at the hearing noted that TZU is a respondent in Family Law property proceedings with an asset pool in the hundreds of thousands of dollars, a compensation claim will be made with respect to her being held against her will by her former husband and TZU is entitled as a beneficiary under her parents' estates of approximately $40,000. Our determination on this issue 1. The legal/jurisprudential approach to the question as to whether a person is capable of managing his or her own affairs has been clearly set out by Justice Lindsay in CJ v AKJ [2015] NSWSC 498 at [27]–[34]: 27. In the absence of an express legislative definition, the expression "(in)capable of managing his or her affairs" should be accorded its ordinary meaning, able to be understood by the broad community (lay and professional) it serves, remembering that: (a) the concept of incapacity for self-management is an integral part of the protective jurisdiction which, historically, arose from an obligation of the Crown (now more readily described as the State) to protect each person unable to take care of him or her self: Marion's Case (1992) 175 CLR 218 at 258, citing Wellesley v Duke of Beaufort (1827) 2 Russ 1 at 20; 38 ER 236 at 243. (b) of central significance is the functionality of management capacity of the person said to be incapable of managing his or her affairs, not: (i) his or her status as a person who may, or may not, lack "mental capacity" or be "mentally ill"; or (ii) particular reasons for an incapacity for self-management: PB v BB [2013] NSWSC 1223 at [5]-[9] and [50]. (c) the focus for attention, upon an exercise by the Court of its protective jurisdiction (whether inherent or statutory), is upon protection of a particular person, not the benefit, detriment or convenience of the State or others: Re Eve [1986] 2 SCR 388 at 409-411, 414, 425-428, 429-430, 431-432 and 434; (1986) 31 DLR (4th) 1 at 16-17, 19, 28-30, 31, 32 and 34; JPT v DST [2014] NSWSC 1735 at [49]; Re RB, a protected estate family settlement [2015] NSWSC 70 at [54]. (d) the "affairs" the subject of an enquiry about "management" are the affairs of the person whose need for protection is under scrutiny, not some hypothetical construct: Re R [2014] NSWSC 1810 at [94]; PB v BB [2013] NSWSC 1223 at [6]. (e) an inquiry into whether a person is or is not capable of managing his or her affairs focuses not merely upon the day of decision, but also the reasonably foreseeable future: McD v McD [1983] 3 NSWLR 81 at 86C-D; EB & Ors v Guardianship Tribunal & Ors [2011] NSWSC 767 at [136]. (f) the operative effect given to the concept of capacity for self-management, upon an exercise of protective jurisdiction by the Court (whether inherent or statutory), is informed, inter alia, by a hierarchy of principles, proceeding from a high to a lower level of abstraction; namely: (i) an exercise of protective jurisdiction is governed by the purpose served by the jurisdiction (protection of those not able to take care of themselves): Marion's Case (1992) 175 CLR 218 at 258. (ii) upon an exercise of protective jurisdiction, the welfare and interests of the person in need of protection are the (or, at least, a) paramount consideration (the "welfare principle"): Holt v Protective Commissioner (1993) 31 NSWLR 227 at 238B-C and 241A-B and F-G; A (by his tutor Brett Collins) v Mental Health Review Tribunal (No 4) [2014] NSWSC 31 at [146]-[147]. (iii) the jurisdiction 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 able to manage his or her own affairs, he or she would, as a right minded and honourable person, desire to do: H.S. Theobald, The Law Relating to Lunacy (London, 1924), pages 362-363, 380 and 462: Protective Commissioner v D (2004) 60 NSWLR 513 at 522 [55] and 540 [150]. (iv) whatever is to be done, or not done, upon an exercise of protective jurisdiction is generally measured against what is in the interests, and for the benefit, of the person in need of protection: Holt v Protective Commissioner (1993) 31 NSWLR 227 at 238D-F and 241G-242A; GAU v GAV [2014] QCA 308 at [48]. 28. The Court's inherent jurisdiction has never been limited by definition. Its limits (and scope) have not, and cannot, be defined: Marion's Case (1992) 175 CLR 218 at 258, citing Re Eve [1986] 2 SCR 388 at 410; (1986) 31 DLR (4th) 1 at 16; Wellesley v Duke of Beaufort (1827) 2 Russ 1 at 20; 38 ER 236 at 243; and Wellesley v Wellesley (1828) 2 Bli. NS 124 at 142; 4 ER 1078 at 1085. 29. The jurisdiction, although theoretically unlimited, must be exercised in accordance with its informing principles, governed by the purpose served by it. 30. Although the concept of "a person… incapable of managing his or her affairs" is foundational to the Court's protective jurisdiction in all its manifestations (inherent and statutory), the purposive character of the jurisdiction is liable, ultimately, to confront, and prevail over, any attempt at an exhaustive elaboration of the concept in practice decisions. 31. From time to time one reads in judgments different formulations of the, or a, "test" of what it is to be "a person (in)capable of managing his or her affairs". Convenience and utility may attach to such "tests", but only if everybody remembers that they provide no substitute for a direct engagement with the question whether the particular person under scrutiny is, or is not, "(in)capable of managing his or her affairs", informed by "the protective purpose of the jurisdiction" being exercised, and the "welfare principle" derived from that purpose. 32. The general law does not prescribe a fixed standard of "capacity" required for the transaction of business. The level of capacity required of a person is relative to the particular business to be transacted by him or her, and the purpose of the law served by an inquiry into the person's capacity: Gibbons v Wright (1954) 91 CLR 423 at 434-438. 33. The same is true of "capacity" for self-management, upon an exercise of protective jurisdiction, governed by the protective purpose of the jurisdiction, viewed in the context of particular facts relating to a particular person in, or perceived to be in, need of protection. 34. Once this is accepted, there is scope for appreciation of different insights available into the meaning, and proper application, of the concept that a person is "(in)capable of managing his or her affairs". 1. When we took into account the facts and circumstances as presented to us regarding TZU and her affairs including her pending family law proceedings and her receipt of an inheritance and applied the legal principles as enunciated in the previous paragraph considering in particular "the protective purpose of the jurisdiction" being exercised, and the "welfare principle" derived from that purpose" we were satisfied that TZU is incapable of managing her own affairs. 2. We were not satisfied that TZU is able to deal with (making and implementing decisions about) her own affairs (person and property, capital and income) in a reasonable, rational and orderly way, with due regard to her present and prospective wants and needs, without undue risk of neglect, abuse or exploitation (see P v NSW Trustee and Guardian [2015] NSWSC 579, [307]–[308]). 3. In considering whether TZU was "able" to manage her own affairs we gave consideration to: * past and present experience as a predictor of the future course of events; * support systems available to TZU; and * the extent to which TZU, placed as she is, can be relied upon to make sound judgments about her welfare and interests: see Lindsay J in CJ v AKJ [2015] NSWSC 498 at [38], and P v NSW Trustee and Guardian [2015] NSWSC 579 at [309]. 1. We note in reaching our decision that the relevant time for considering whether TZU is incapable of managing her affairs is not merely the day of the hearing but the reasonably foreseeable future (McD v McD (1983) 3 NSWLR 81 at 86). Is there a need for a financial management order and is it in TZU's best interests that an order is made? 1. We were satisfied that there is a need to appoint someone to manage TZU's affairs. In reaching this decision we took into account the following matters. 2. Although TZU had made an enduring power of attorney, ESI said to us at the hearing and in her application that there was a real concern, as expressed to her by Ms Z (We tried on several occasions to contact Ms Z by telephone both at her office and her mobile but to no avail.), TZU's solicitor, that the court in TZU's family law proceedings may not accept an attorney appointed by TZU as capable of distributing matrimonial property pursuant to any Orders of the Court. In addition, ESI said that Ms Z has made an application to the Court to appoint her, ESI, as TZU's litigation manager. 3. Although ESI used the term litigation manager under the Federal Circuit Court Rules the appropriate term is "litigation guardian". If the matter is before the Family Court the term is "case guardian". The relevant Rules for both courts are as follows: Federal Court Rules Rule 11.08 Person who needs a litigation guardian (1) For these Rules, a person needs a litigation guardian in relation to a proceeding if the person does not understand the nature and possible consequences of the proceeding or is not capable of adequately conducting, or giving adequate instruction for the conduct of, the proceeding. Rule 11.09 Starting, continuing, defending or inclusion in proceeding (1) A person who needs a litigation guardian may start, continue, respond to or seek to be included as a party to a proceeding only by his or her litigation guardian. Rule 11.10 Who may be a litigation guardian A person may be a litigation guardian in a proceeding if he or she is an adult and has no interest in the proceeding adverse to the interest of the person needing the litigation guardian. Rule 11.11 Manager of the affairs of a party (1) In this rule: "manager of the affairs of a party" includes a person who is authorised by or under a Commonwealth, State or Territory law to conduct legal proceedings in the name of, or for, a person who needs a litigation guardian. (2) A person who is a manager of the affairs of a party is entitled to be the litigation guardian in any proceeding to which the authority extends. (3) The Attorney-General may appoint in writing a person to be a manager of the affairs of a party for this rule, either generally or for a particular person. (4) A manager of the affairs of a party becomes the litigation guardian of a person who needs a litigation guardian in a proceeding if the manager of the affairs of the party files an affidavit of consent in relation to the person. Family Law Rules Rule 6.08A Interpretation In this Part: "a manager of the affairs of a party" includes a person who has been appointed, in respect of the party, a trustee or guardian under a Commonwealth, State or Territory law. Rule 6.08 Conducting a case by case guardian (1) A child or a person with a disability may start, continue, respond to, or seek to intervene in, a case only by a case guardian. (2) Subrule (1) does not apply if the court is satisfied that a child understands the nature and possible consequences of the case and is capable of conducting the case. 1. But for the court proceedings the current arrangements for the management of TZU's affairs are, in our view, working well and there would be no need for the making of a financial management order. We are satisfied that ESI is utilising the enduring power of attorney instrument properly and appropriately in the best interests of TZU. 2. However, TZU's court proceedings need to be taken into account. Depending on the court in respect of which the Family Law Act property proceedings are conducted TZU will need either a case guardian or a litigation guardian. Having a power of attorney in place is not sufficient to meet the standards set by the Rules regarding a case guardian or litigation guardian. 3. TZU needs a financial management order to ensure that there is no issue regarding the smooth conduct of her case before the court dealing with her Family Law property proceedings and any other proceedings that may arise in the immediate future. 4. In light of all of the matters set out earlier in these Reasons for Decision we were satisfied that it is in the best interests of TZU that a financial management order be made. Who should be appointed as financial manager? 1. In appointing a financial manager, as in making all other orders under the Guardianship Act 1987 (NSW), we 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. 2. Section 25M of the Guardianship Act provides that, if we make a financial management order, we 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. 3. In Holt & Anor v Protective Commissioner (1993) 31 NSWLR 227, the Court said that the dominant consideration in making orders about financial managers was the welfare of the person. The President of the Court of Appeal emphasised the Court's broad discretion in deciding who should be financial manager but also set out possible considerations as to the competing advantages of the then Protective Commissioner and a family member as the manager of an estate. The NSW Trustee and Guardian now exercises the role of the Protective Commissioner. 4. In Application by AMAM; Re SAM [2011] NSWSC 503, Hallen AsJ stated: [34] It would be unwise to attempt any definition of the matters that may legitimately be enquired into to determine whether the applicant is suitable. Each case must depend on its own circumstances. Needless to say, however, the Court must consider, at least, the proposed manager's character, honesty and ability to manage, diligently, the managed person's property in the managed person's best interests. 1. The matters or "guidelines" that should be considered when determining who to appoint as financial manager, as established in Holt & Anor v Protective Commissioner (1993) 31 NSWLR 227, are discussed and expanded upon by Lindsay J in M v M [2013] NSWSC 1495 at [50]. 2. Although ESI is not related to TZU and cannot be considered "family", we were impressed by the genuine care and concern that she held for TZU. We could see that ESI encourages TZU to do as much as she can. ESI has been able to use the enduring power of attorney made by TZU in her best interest. ESI is highly supportive of TZU and has, in our view, acted in her capacity as attorney with the welfare and interests of TZU very much as the paramount consideration. 3. We had no doubt that ESI will manage TZU's affairs in her best interests and after conducting appropriate due diligence of her we were satisfied that she was a suitable person to be appointed as financial manager for TZU subject to the authorities and directions of the NSW Trustee and Guardian. Should a reviewable financial management order be made? 1. We may determine that a financial management order should be reviewed within a specified time. In this matter, we determined that the financial management order should be reviewed within two years because it is only needed for the purposes of conducting any Family Law proceedings on TZU's behalf. We considered that the proceedings should have been concluded in two years. Once the proceedings have been concluded and any property distributed in accordance with the orders of the Court, the enduring power of attorney, suspended during the currency of the financial management order we have made, can be enlivened with TZU having the benefit of a trusted friend assist her with her financial affairs under the power of attorney. ********** 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: 01 May 2019