NSW Civil and Administrative Tribunal New South Wales Medium Neutral Citation: FZN [2018] NSWCATGD 46 Hearing dates: 31 May 2018 Date of orders: 31 May 2018 Decision date: 31 May 2018 Jurisdiction: Guardianship Division Before: K A McMahon, Senior Member (Legal) Dr I L Beale, Senior Member (Professional) S Johnston, General Member (Community) Decision: In relation to the enduring power of attorney made by FZN on 25 June 2012 appointing NZE and BZD as attorneys the Tribunal determines, orders or declares: Not to carry out a review of the operation and effect of the enduring power of attorney. The application is dismissed. In relation to the enduring power of attorney made by FZN on 26 February 2018 appointing QYE as attorney and BZD as substitute attorney, the Tribunal determines, orders or declares: Not to carry out a review of the making and the operation and effect of the enduring power of attorney The application is dismissed. 1. The estate of FZN is subject to management under the NSW Trustee and Guardian Act 2009 (NSW). 2. NZE 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. Catchwords: REVIEW OF ENDURING POWER OF ATTORNEY – application to review making and operation and effect of enduring power of attorney – enduring power of attorney already revoked – application dismissed. FINANCIAL MANAGEMENT – application for financial management order – whether subject person is incapable of managing their affairs – whether subject person is at risk of exploitation – whether proposed financial manager is suitable – where supervision of financial manager by NSW Trustee and Guardian would provide transparency – appointment of private financial manager – order made. Legislation Cited: Guardianship Act 1987 (NSW), ss 4, 25M, Pt 3A Power of Attorney Act, ss 36, 36(1)-(2), 36(4)(b)-(c), 36(4)(g) Cases Cited: 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 P v R [2003] NSWSC 819 PB v BB [2013] NSWSC 1223 Re D [2012] NSWSC 1006 Re W and L (Parameters of Protected Estate Management Orders) [2014] NSWSC 1106 Susan Elizabeth Parker v Margaret Catherine Higgins & Ors [2012] NSWSC 1516 Texts Cited: Nil Category: Principal judgment Parties: 011: Review of an Enduring Power of Attorney FZN (the person) SZI (applicant) QZI (applicant) NZE (attorney) BZD (attorney) 012: Review of an Enduring Power of Attorney FZN (the person) SZI (applicant) QZI (applicant) QYE (attorney) 013: Financial Management Application FZN (the person) QZI (applicant) SZI (applicant) QYE (attorney) NZE (attorney) NSW Trustee and Guardian Representation: S Williams for FZN File Number(s): NCAT 2008/00466765 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 the Tribunal decided 1. We made a financial management order in relation to FZN and appointed NZE as her financial manager, subject to the authorities and directions ordered by the NSW Trustee and Guardian. 2. In relation to the enduring power of attorney made by FZN dated 25 June 2012 appointing NZE and BZD as her attorneys, we decided not to carry out a review of the operation and effect of the enduring power of attorney and dismissed the application. 3. In relation to the enduring power of attorney made by FZN dated 26 February 2018 appointing QYE as attorney and BZD as substitute attorney, we decided not to carry out a review of the making and operation and effect of the enduring power of attorney and dismissed the application. Background 1. FZN is an 82-year-old woman who previously lived in her own home in regional NSW. In 2008, FZN moved to an aged care home and later moved to another facility. 2. FZN is reported to have longstanding and severe rheumatoid arthritis, osteoporosis and hypertension and for the last few years has been bed bound. FZN is legally blind and has a severe hearing impairment. 3. FZN has a daughter, SZI, who lives in regional NSW (the daughter) and a son, QZI, who lives in Queensland (the son). FZN has a number of grandchildren including NZE who is SZI's daughter (the granddaughter). 4. The granddaughter lives in the same town as FZN and is married to QYE. 5. On 23 January 2003, FZN executed an enduring power of attorney appointing the daughter and the son as her attorneys. 6. On 19 June 2009, FZN revoked this appointment. This was done after FZN's house in regional NSW was transferred to the daughter. There is dispute between FZN and the daughter and the son as to the purpose and circumstances of the transfer. Following settlement of Supreme Court proceedings instigated by FZN about the transfer, the house was transferred back to her. 7. On 5 September 2008 the Tribunal made a guardianship order for FZN, appointing the daughter and the son as her guardians to make decisions about her accommodation. The Tribunal granted leave for a financial management application made by the son to be withdrawn and dismissed the application. 8. When the guardianship order was reviewed by the Tribunal on 7 September 2009, the Tribunal appointed the Public Guardian to make decisions about FZN's accommodation and services. On 3 September 2010, this order was reviewed by the Tribunal and allowed to lapse. 9. On 26 May 2010 the Tribunal considered a financial management application by the son and was not satisfied that FZN was incapable of managing her affairs. The financial management application was dismissed. 10. On 25 June 2012, FZN executed an enduring power of attorney, appointing the granddaughter and BZD as her attorneys. 11. On 19 April 2013, the Tribunal dismissed an application made by the son for review of the enduring power of attorney appointing the granddaughter and BZD as attorneys. The Tribunal was not satisfied that FZN did not have capacity to revoke the earlier enduring power of attorney dated 23 January 2003 or execute the enduring power of attorney dated 25 June 2013. 12. Following FZN's move to residential care, FZN's house in regional NSW was rented out. The granddaughter lived in the house for a period for 12 months in around 2014. From 2015, the house was again rented out to tenants who were friends of the granddaughter and who vacated the property in 2017. In December 2017, FZN's house in regional NSW was sold. 13. On 12 December 2017 the Tribunal received an application from the daughter and the son for a review of the operation and effect of the enduring power of attorney made on 25 June 2012 appointing the granddaughter and BZD. 14. On 26 February 2018, FZN revoked the enduring power of attorney dated 25 June 2012 appointing the granddaughter and BZD. On this day, FZN executed a new enduring power attorney appointing QYE as her attorney and BZD as her substitute attorney. 15. On 20 April 2018, the Tribunal received an application from the daughter and the son for a financial management order for FZN. 16. On 30 April 2018, the Tribunal received an application from the daughter and the son for review of the making and operation and review of the enduring power of attorney appointing QYE as her attorney and BZD as her substitute attorney. 17. The daughter and the son express concerns about mismanagement of FZN's financial affairs. This includes allegations that funds from her aged pension and rental income have been misappropriated by the granddaughter for her own benefit. They state that the sale of FZN's house in regional NSW was contrary to her interests and are worried that funds from the sale will be mismanaged, detrimentally impacting on her financial security. The daughter and the son maintain that FZN is incapable of managing her financial affairs and that her attorneys have not fulfilled their obligations, placing her at risk. They state FZN is vulnerable and unduly influenced by the granddaughter who is isolating FZN from other family members. In their applications to the Tribunal they propose the appointment of the NSW Trustee and Guardian. The hearing 1. 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.] 2. Arrangements were made for the hearing to be held at the aged care home which accommodates FZN, to facilitate FZN's participation. With the assistance of a hearing wand, FZN was able to hear the proceedings and gave oral evidence to us. FINANCIAL MANAGEMENT APPLICATION What did the Tribunal have to decide? 1. The questions to be considered by the Tribunal are: * Is FZN incapable of managing her affairs? * Is there a need for another person to manage FZN'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? Medical evidence Dr O, Geriatrician 1. Dr O recently reviewed FZN and in evidence before us is a copy of his report dated 11 May 2018. He notes that FZN's medical history is significant for long standing rheumatoid arthritis with severe deformities affecting both upper limbs. Dr O states that FZN is "totally crippled" and has been bed bound for the past few years. She is dependent in her self-care and feeding. Dr O reports that FZN is legally blind and has a severe hearing impairment. 2. Dr O states FZN was referred to him for an opinion regarding her capacity to make decisions about financial management. In his view, FZN "seems to be brilliant in her cognitive abilities". Dr O notes that FZN was able to tell him her life story without any difficulty and he thought the information was coherent with reference to her previous notes. In relation to recent events, Dr O records: [FZN] has sold her house recently and put the money in her bank. A[s] a result her pension has been halved. She thinks that she would be able to cover up the damage with her investment. 1. Dr O notes that FZN complains that her daughter and son falsely believe that she does not have capacity, stating that she has dementia. After elaborating on the complexity of her family dynamics, FZN told Dr O that she had given enduring power of attorney and enduring guardianship to her granddaughter and husband and was happy about this. FZN said "she is happy to give some of her extra money for their expenses thinking they are struggling in their lives". 2. Dr O states he briefly conducted a cognitive assessment, given that FZN has got severe limitations in eyesight and dexterity. In his view she has intact orientation in time, place, recall, concentration and language abilities. It is Dr O's opinion that without doubt FZN has capacity to make decisions in relation to her financial management. He notes there is no evidence of underlying neurodegenerative disease or dementia. 3. The daughter takes issue with Dr O's report. She states that his assessment does not adequately take into account previous diagnosis of dementia, restrictions arising from her physical conditions, ability to deal with manipulative behaviour, isolation from family and that she takes morphine in large doses for pain relief. She states Dr O did not consult with other family members to confirm the accuracy of the information being provided to him. She states that some of the details provided by FZN are inaccurate showing lapses in her memory. The daughter maintains that Dr O failed to explore with FZN the validity of comments made about her finances and family situation or address the complexity of decision making about her finances which requires weighing up the options. Earlier Medical Reports 1. The daughter and the son rely on earlier medical reports provided in previous Tribunal applications concerning FZN. Copies were provided to us. 2. This includes a report from Dr G, General Practitioner, dated 28 August 2009 in which he expresses the opinion that FZN had mild dementia which was improving and associated with malnutrition, steroid therapy and depression. He states her depression is a fluctuating condition. FZN scored 29/30 on the Mini-Mental State Examination (MMSE). 3. Also before us is a report from Dr N, General Practitioner, dated 10 December 2012. It was Dr N's view that FZN suffers mild dementia although recommends that specialist opinion be obtained. 4. The daughter and the son have also provided us with a copy of a report from Ms X, aged care home leader, dated 13 December 2012. Ms X notes FZN's complex medical issues on admission in 2008 detracting significantly from her functional capacity, however she was cognitively intact. Ms X reports that between March and June 2012 FZN exhibited severe paranoid delusions and auditory hallucinations impairing her capacity. Sale of house in regional NSW 1. A focus in the daughter and the son's application is the sale of FZN's house in regional NSW. They state that the sale of the house was not in FZN's best interest and is to her detriment financially. The daughter and the son state that the house was FZN's only asset and was growing in value and the rent provided her with an income which was exempt from tax and did not affect her aged pension. They state FZN's aged pension has been substantially reduced as a result of the sale of the house. 2. The daughter and the son express concern that FZN was unduly influenced by the granddaughter in making the decision to sell the house and that funds from the sale will be used to fund a commercial construction on her premises for her business. The daughter and the son have provided us with a copy of a development application lodged by the granddaughter and QYE in April 2018 relating to their property in the same town. The development application indicates the estimated construction cost to be $160,000. They are concerned that this will be funded by FZN as they do not believe the granddaughter and QYE have sufficient funds themselves. 3. The daughter and the son maintain that FZN has fluctuating mental capacity and in conversations with family members in 2017 and 2018 exhibited confusion about the sale of her house and other circumstances. This is consistent with statements provided by the daughter and FZN's other granddaughter, OZK, who visited her at her aged care home accommodation. 4. FZN told us she decided to sell her house in regional NSW because it was a "bad investment". She was not sure when she decided to sell the house however thought it was perhaps around two months ago. She thought the house was a bad investment because it needed repairs, referring to broken pipes. FZN said a real estate agent helped to arrange the sale. The house was not advertised and consideration was not given to putting the house up for auction. The real estate agent located a purchaser for the house. 5. FZN said that she received "$400,000 give or take from the sale". She was unclear as to the expenses associated with the sale. FZN said she had invested the funds from the sale with a bank in "two little lots". 6. FZN said that at the time of the sale she was not aware that the sale would affect her pension. She would not concede that it would have been useful for her to have had this information at the time she decided to sell. FZN said she became aware that her pension would be affected when she received advice from a financial advisor after the sale. FZN disagrees that the sale of the house detrimentally impacts on her finances. 7. The granddaughter agrees that FZN spoke to her about the proposed sale of the property, however, states that the decision to sell was made by FZN. The granddaughter said that FZN decided to sell in late-2017 because the house needed repairs. The granddaughter's evidence was unclear as to the repairs required. She referred to broken pipes and the house needing a new hot water system, although indicated a new hot water system was obtained some years ago. The granddaughter indicated the sale was done quickly as FZN "just want to get rid of the house" and "jumped at the opportunity" when an offer was made through the real estate agent. The granddaughter denies that funds from the sale will be used to fund construction at her premises. QYE states that shortly after lodging the development application, alternative premises were located to lease by the granddaughter for her business. We accept there is presently no plan to use funds from the sale of the FZN's house to fund construction of commercial premises at the granddaughter's property. 8. An extract from CoreLogic indicates the house was sold in 2017 for $450,000. A document from NSW Land Registry indicates that a transfer was executed on the property in early-2018. 9. QYE told us that he sought advice on FZN's behalf from Centrelink about the impact of the sale on FZN's pension in late-2017. He said the advice was to the effect that the sale had to go through before an assessment could be done and the impact on her pension ascertained. 10. QYE said that FZN had invested the proceeds of the sale in term deposits with her bank. This is consistent with her bank statements which are in evidence before us indicating two term deposits of $300,000 and $100,000 held in FZN's name with interest rates of 2.65% and 2.5% per annum respectively. FZN also has a retirement bank account with her bank with a balance of $454,167 as at 30 April 2018 as evidenced in a statement provided to us. Allegations of misuse of funds 1. The daughter and the son express concern that the granddaughter has misappropriated funds received by FZN from her aged pension and rental income for her own use over some years. The daughter and the son maintain that FZN should have considerably more funds accumulated from rental income than is evidenced in her bank statements from her bank. 2. As evidenced in the statements of the daughter, the son and other family members, conflict has arisen over the granddaughter's relationship with FZN and her influence over her finances. There are concerns that the granddaughter is financially exploiting FZN. The granddaughter denies that any exploitation has occurred. The daughter and the son, through solicitors, have sought to obtain details and documents about FZN's finances, however, their requests have been refused. By way of letter dated 6 October 2017, BZD, acting for FZN, advised that the daughter is not entitled to the documents requested. 3. We have been provided with statements from KZO (the great-grandson) who is the son of the granddaughter. The great-grandson's evidence is the granddaughter's practice has been to withdraw money from FZN's account. On one occasion, the granddaughter provided the great-grandson with $500 from FZN's bank account to cover his expenses when he was moving to Queensland. On other occasions he states the granddaughter withdrew money to buy illicit drugs. The great-grandson's statements details substantial conflict in his relationship with the granddaughter, and in the granddaughter's relationship with other family members over years. 4. The daughter and the son sought that the granddaughter produce bank statements for FZN's retirement bank account for the period 2012 to 2018 pursuant to a summons issued by the Tribunal. The granddaughter produced statements from December 2017. The daughter and the son state that these statements indicate an amount of $2,413 has been withdrawn by the granddaughter for her own use, including at various shops, food outlets and a beauty salon in locations away from FZN's town in regional NSW and unrelated to FZN's needs. 5. The granddaughter states that she did not produce all of the bank statements because FZN did not want to produce them. It was unclear as to why the granddaughter had then chosen to produce some statements, being those postdating the commencement of the applications. The result being that all of the relevant information was provided to the Tribunal. In any event, the granddaughter does not dispute that she has access to FZN's retirement bank account, as she has a card on the account, however, states that any withdrawals she makes are with FZN's approval. She states that the funds are used for FZN's expenses such as clothing and for items for herself and her household with FZN's approval. She gave as an example, a sport jersey for her son that she purchased with FZN's funds. In relation to FZN's retirement bank account, the granddaughter said that "pretty much what goes in comes out". She was unable to detail FZN's expenses. 6. FZN told us that the granddaughter has access to her retirement bank account and that this accords with her wishes. She told us that the granddaughter purchases items for her to make sure she has everything that she needs. On the basis of the evidence of FZN and the granddaughter it was not clear to us what the scope of the arrangement was regarding the granddaughter's access to funds. Their evidence was contradictory on this issue. It was not clear whether FZN authorises each expenditure or whether the granddaughter more broadly has a discretion to access funds for herself. Whilst FZN and the granddaughter said that FZN authorises each transaction, FZN also said in relation to the granddaughter accessing her funds; "I am quite happy to give it to her" and "if she feels that she needs to do it she can do it". The granddaughter maintains however that each transaction is authorised by FZN. 7. The granddaughter maintained that FZN manages her own finances and that she has he has not generally acted as FZN's attorney further to the enduring power of attorney executed on 25 June 2012. 8. BZD in a statement provided to us indicates he is aware that FZN authorised and provided the granddaughter with a bank card that allows access to FZN's account. He states that his understanding is that this has nothing to do with the granddaughter at the time being FZN's attorney. BZD states that the card allows the granddaughter to purchase items as requested from time to time by FZN. BZD says that to the best of his knowledge the granddaughter whilst FZN's attorney only utilised this appointment to lodge tax assessments and returns, sign the contract and transfer for the sale of her house and to invest the proceeds of same. Is FZN incapable of managing her affairs? 1. In Re D [2012] NSWSC 1006, White J assessed the history of case law in relation to financial management and noted that initially the issue of capability was approached by referring to hypothetical or abstract notions of the ordinary affairs of man. However, the Court now assesses the person's own capacity to do what they are proposing to do [58]. White J used a "rational appreciation" of assets test to determine a person's capability to manage his or her affairs. He adopts the reasoning of Barrett J in P v R [2003] NSWSC 819 who said that the task of the Court in these circumstances: … is to make a judgment as to the capacity and ability of the person concerned to cope with the ordinary routine affairs of living, particularly so far as they concern the person's property…the requisite judgment is to be made in the light of objective physical facts concerning the relevant person's property, money and other assets and the way the person is able to look after them. If there is a lack of capacity, the reason for it does not matter [26]. 1. In PB v BB [2013] NSWSC 1223, Justice Lindsay confirmed that the question focuses attention on the special circumstances of the person. His Honour stated, at [7]: Of central significance is the functionality of management capacity of the person said to be incapable of managing his or her affairs, not: (a) his or her status as a person who may, or may not, lack "mental capacity" or be "mentally il"; or (b) particular reasons for an incapacity for self-management. 1. 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. 1. 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 at [38], and P v NSW Trustee and Guardian [2015] NSWSC 579 at [309]. 1. The relevant time for considering whether a person is incapable of managing his or her affairs is not merely the day of the hearing but the reasonably foreseeable future (McD v McD (1983) 3 NSWLR 81 at 86). See Lindsay J in Re W and L (Parameters of Protected Estate Management Orders) [2014] NSWSC 1106 at [20]: Each case must, of course, be considered on its own facts, including not only actual facts presently known but also, so far as they can be known, prospective developments. 1. The daughter and the son state that FZN is incapable of managing her financial affairs. They state that FZN by reason of her education, health and mental issues she has always required assistance. They emphasise FZN's physical disabilities and that she is unable to read or sign documents or independently verify information provided to her. The daughter and the son stress that FZN is extremely vulnerable to being influenced by others and that her cognitive capacity fluctuates and that she experiences confusion. They say she is not able to understand the complex financial issues required to capably manage her own financial affairs. They are concerned that FZN is at risk of dissipating her finances impacting on her welfare. 2. The daughter and the son maintain that FZN's financial affairs are essentially managed by others, and specifically the granddaughter who they state exercises undue influence over her. They state that family conflict has led to FZN becoming isolated and increasingly reliant on the granddaughter. 3. FZN disputes that she is incapable of managing her financial affairs. She states that she previously managed two businesses, which is disputed by the daughter and the son and that she takes a keen interest in her finances. FZN described to us that she "loves managing her money" and that this gives her something to occupy her mind and is very important to her. 4. FZN denies that she has any cognitive incapacity or is unable to manage her finances due to her physical disabilities. When we asked FZN about her recent assessment with Dr O she told us she had "passed a dementia test". FZN was unable to explain to us what she meant when she told Dr O that whilst her pension has been halved as result of the sale of her house she "would be able to cover up the damage with her investment", although said there was now a "gap" which her investment would cover. She was unable to provide details of her investment other than to say it was in "two lots" with her bank. FZN did not know the balances of her bank accounts nor was she able to provide us with clear details of her income and liabilities. FZN was unsure about how much she paid at her aged care home accommodation, or what her medical expenses were. 5. FZN was uncertain of the tenancy arrangements over the years for her house in regional NSW. We formed the view from FZN's evidence that whilst the granddaughter had consulted with her about tenancy decisions, the granddaughter had been responsible for managing the property over many years. It was apparent from FZN's evidence that she was very reliant on the granddaughter in this regard and more generally in relation to management of her finances. She told us the granddaughter "fixed up all the issues" about payment of her accommodation at the aged care home, and her other expenses. Whilst FZN is broadly across the issues relating to her financial affairs, her evidence indicated that she does not have her head around the detail. 6. FZN disputes that she is subject to any undue influence or exploitation from the granddaughter and stressed that she makes all the decisions. FZN said that she wanted the daughter and the son "to leave her alone" and was clearly upset that they had instigated further proceedings in the Tribunal. 7. Mr Mitchell, legal representative for FZN, submitted that FZN is capable of managing her financial affairs emphasising the recent assessment from Dr O supporting this. Mr Mitchell submitted that whilst FZN has physical limitations, this does not impact upon her capacity and that the evidence indicates she understands information given to her. 8. The granddaughter's evidence was that FZN is capable of managing her own financial affairs. Whilst the evidence indicated that the granddaughter was responsible for managing tenancy issues relating to FZN's house and clearly involved in decisions about the sale of the property the granddaughter was vague on the detail about FZN's finances and tended to minimise her role. 9. QYE was accepting of FZN's physical limitations impacting on her ability to manage her finances. He described that when attempts are made to read documents to FZN, "it becomes more of a conversation" and she is reliant on the interpretation of the document and the advice given by others. QYE agrees that FZN is very vulnerable and said that it would be "quite silly" to suggest to the contrary. He said she needs the help of others. 10. QYE's evidence suggested he had been very involved in discussions with FZN about how to invest the money from the sale of her house and that she was very reliant on the advice from himself and others. Tribunal's finding on incapacity 1. We place greater weight on the evidence from Dr O than that of Dr G and Dr N given the equivocal nature of their evidence and length of time since their assessments. The evidence of Ms X is limited to the period between March and June 2012 and we do not place weight on it. 2. We accept Dr O's evidence to the extent that FZN is orientated in time, place, recall, concentration and her language abilities are intact. This is consistent with our own observations of FZN. We accept Dr O's assessment that FZN does not have dementia, however, consider that the issue of FZN's capability to manage her financial affairs extends beyond this. It is not in issue that FZN has severe physical limitations which impact on her ability to access information, implement financial decisions and manage her finances. This places her in an extremely vulnerable position. Her vulnerability is exacerbated by her lack of insight into the extent to which she is reliant on others. Her assertions of independence about the management of her affairs belie the reality. Whilst FZN is broadly aware of her financial situation she is clearly not across the detail. There is incongruity in her evidence and that of the granddaughter about the extent to which she controls the use of her funds or whether the granddaughter broadly accesses her funds not only for FZN but for her own benefit. FZN is at risk of financial exploitation and given that we were provided with statements from her retirement bank account for the period since December 2017 only, we could not be confident that this has not occurred. 3. FZN's lack of capability is indicated not only by her failure to consider the impact of the sale of her house on her pension, given the importance of this income for her, but also her lack of concession that it would have been useful to be aware of this before she decided to sell. Whilst she asserts decisions about the tenancy and sale of the property and investments are all her own, this is inconsistent with much of the other evidence indicating the extent of her dependence on others and particularly the granddaughter. The granddaughter tended to minimise her role and neither she nor FZN were able to articulate to us in detail the reasoning behind why the house in regional NSW was a bad investment beyond identifying that pipes were broken. FZN had a most limited appreciation of her future investment strategy and we accept is at risk of her funds being dissipated to her detriment. 4. Our conclusion is that the weight of the evidence indicates that FZN is not capable of managing her financial affairs and we make this finding. Is there a need for a financial management order and is it in FZN's best interest that an order be made? 1. The daughter and the son contend that a financial management order is needed to ensure that FZN's finances are appropriately managed and her welfare is protected. They say an order is needed to protect FZN from financial exploitation. In their application to the Tribunal, they propose the NSW Trustee and Guardian be appointed. At the hearing the daughter and the son however indicated support for the granddaughter being appointed as financial subject to the directions and authorities of the NSW Trustee and Guardian. 2. Whilst FZN's position was that she was capable of managing her own financial affairs, she was agreeable to an order being made appointing the granddaughter as her financial manager subject to the directions and authorities of the NSW Trustee and Guardian. She said she would be happy with this outcome. 3. Whilst stating that FZN has capacity to manage her financial affairs, Mr Mitchell, legal representative, also supported the proposal that the granddaughter be appointed as private financial manager. His saw benefit in the NSW Trustee and Guardian performing a supervisory role to protect FZN and mitigate against further Tribunal hearings which distress FZN. 4. BZD described the proposal as a "great idea" stating that this would provide transparency and assist in allaying other family member's concerns. 5. QYE was in favour of the proposal. He said that it made more sense for the granddaughter to be appointed than for him to act as FZN's attorney as she sees FZN more frequently and has a closer connection with her. 6. The granddaughter was agreeable to order appointing her as FZN's financial manager subject to the directions and authorities of the NSW Trustee and Guardian. 7. We accept there is merit in the daughter and the son's argument that a financial management order is needed and in FZN's best interests given our findings about her incapacity, vulnerability and need to protect her welfare. FZN is at risk of financial exploitation and dissipating her assets. 8. We take into account that FZN's desire to maintain her independence and that being involved in managing her finances helps to occupy her mind and she enjoys it. A countervailing factor is her support for the granddaughter's appointment and that the granddaughter, we accept, will consult her about decisions. A financial management order will provide protection to FZN however. 9. We are satisfied there is a need for a financial management order and that this is in FZN's best interests. 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) ("the 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 Act. 2. Section 25M of the 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. 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. On the side of the then Protective Commissioner was seen to be the manifest independence of the statutory office, the advantages of a dispassionate and neutral approach in situations of family conflict and divided views as to the best interests of the person, expertise and experience in managing estates, an impeccable reputation and the security provided to an estate against loss or damage. 5. The advantages of the appointment of a family member were more economic management of smaller estates (that is, freedom from fees) and a greater familiarity with assets and liabilities in smaller estates, a greater capacity of a person with a disability to interact with the manager so as to exercise a greater influence over the broad directions of the management of the estate, love and affection for and knowledge of the protected person and concern for his or her quality of life, and particular qualities or qualifications enabling family members to act as managers. 6. The Court considered that interrelated property interests in a family situation, where a conflict of interest and duty may be "more apparent than real", should not necessarily present an absolute bar to appointment of a family member who is otherwise appropriate. However, when appointing a family member, a decision maker must be satisfied that the estate, income and capital assets, will be utilised to advance the interests and quality of life of a protected person rather than to eventually increase the assets of the family. 7. 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. We gave consideration as to whether to appoint the NSW Trustee and Guardian or the granddaughter as private financial manager. In reaching the conclusion to appoint the granddaughter we take into account the support of all the participants of the hearing and the benefit of a personal knowledge of FZN and connection to her that the granddaughter will bring to the role. Further the appointment of the granddaughter subject to the directions and authorities of the NSW Trustee and Guardian will provide transparency and protection to FZN. 3. The granddaughter's evidence revealed no disqualifying factors that would prevent her acting as FZN's financial manager. She is aware that if appointed as FZN's financial manager she is required to work under the directions and authorities of the NSW Trustee and Guardian and be accountable to that office. She saw no difficulties in complying with these requirements. 4. We were satisfied that the granddaughter was a suitable person to be appointed as financial manager for FZN subject to the directions and authorities of the NSW Trustee and Guardian. APPLICATION TO REVIEW ENDURING POWER OF ATTORNEY APPOINTMENT DATED 25 JUNE 2012 1. The daughter and the son have made application to the Tribunal to review the operation and effect of the enduring power of attorney executed by FZN dated 25 June 2012 appointing the granddaughter and BZD. The Tribunal has previously found that FZN had capacity to execute this document. 2. The Tribunal may, on the application of an interested person, decide to review the making or the operation and effect of a reviewable power of attorney, or not to carry out such a review: Power of Attorney Act 2003 (NSW) ("the POA Act"), s 36(1). As a consequence of reviewing the making or operation and effect of a reviewable power of attorney, the Tribunal may decide whether or not to make an order under s 36 of the POA Act (s 36(2)). 3. The Tribunal may make a number of orders relating to the operation and effect of a power of attorney if it is satisfied: * that it would be in the best interests of FZN to make the order; * that it would better reflect the wishes of FZN to make the order. 1. These orders include, but are not limited to: * An order removing a person from office as an attorney: s 36(4)(b) of the POA Act; * An order appointing a substitute attorney to replace an attorney who has been removed from office by a review Tribunal or who otherwise vacates the office: s 36(4)(c) of the POA Act; * Such other orders as the review Tribunal thinks fits: 36(4)(g) of the POA Act. 1. If on a review of the enduring power of attorney, the Tribunal decides not to make an order under s 36 of the Powers of Attorney Act, it may, if it considers it appropriate in all of the circumstances to do so, decide to treat the application for review as an application for a financial management order under Pt 3A of the Act. Should the Tribunal conduct the review? 1. In Susan Elizabeth Parker v Margaret Catherine Higgins & Ors [2012] NSWSC 1516, Slattery J stated [at 80]: On an application for s 36 review such as this the Court must first exercise a discretion under Powers of Attorney Act, s 36(1) to decide whether or not to conduct a s 36 review. In my view the Court does not have to conduct a full review of all documents associated with the operation of the subject power of attorney to do this. Something short of a full review must be able to justify the exercise of the s 36(1) discretion as to whether or not the Court should conduct a full s 36 review. In the circumstances of this case the Court can glean sufficient information to exercise the s 36(1) discretion by undertaking a general survey of what... (a party )...has produced. 1. As noted by the Tribunal on 22 March 2018 the enduring power of attorney made on 26 June 2012 has now been revoked and the application of the daughter and the son serves no practical purpose. The concerns raised by the daughter and the son in this application are mirrored in their application for a financial management order. Taking into account that the enduring power of attorney has been revoked, review of the documents provided and the financial management order made we decided not to conduct a review and dismissed the application. APPLICATION TO REVIEW ENDURING POWER OF ATTORNEY APPOINTMENT DATED 26 FEBRUARY 2018 1. The daughter and the son made application for review of the enduring power of attorney appointment dated 26 February 2018 appointing QYE as attorney and BZD as substitute attorney. The concerns raised by the daughter and the son in this application are mirrored in their financial management application. Taking into account our review of the documents and financial management order made we decided not to conduct a review and dismissed the application. ********** 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: 11 October 2019