Civil and Administrative Tribunal New South Wales Medium Neutral Citation: ZMQ v ZMR [2020] NSWCATAP 25 Hearing dates: 25 October 2019 Date of orders: 21 February 2020 Decision date: 21 February 2020 Jurisdiction: Appeal Panel Before: A Britton, Principal Member L Dive, Senior Member S Johnston, General Member Decision: Appeal is dismissed. Catchwords: POWERS OF ATTORNEY — whether Tribunal failed to determine claim for orders under s 36(4) of the Powers of Attorney Act 2003 (NSW) POWERS OF ATTORNEY — nature of the obligation owed by attorney to the principal ADMINISTRATIVE LAW — nature of NCAT's obligation to give reasons for decision — whether Tribunal failed as required to explain its reasoning processes that lead it to the conclusions it made IRRELEVANT CONSIDERATIONS — whether in exercising the discretion to make, or not to make orders s 36(4) of Powers of Attorney Act the Tribunal had regard to impermissible considerations Legislation Cited: Civil and Administrative Tribunal Act 2013 (NSW) Guardianship Act 1987 (NSW) Powers of Attorney Act 2003 (NSW) Cases Cited: Ali v AAI Limited [2016] NSWCA 110 BTH v The Public Guardian [2017] NSWCATAP 10 Casey v Repatriation Commission (1995) 60 FCR 510 Dranichnikov v Minister for Immigration and Multicultural Affairs [2003] HCA 26; 77 ALJR 1088 Hospital Products Ltd v United States Surgical Corporation and Others [1984] HCA 64; (1985) 156 CLR 41 Lo v Chief Commissioner of State Revenue [2013] NSWCA 180; (2013) 85 NSWLR 86 Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; 162 CLR 24 Minister for Immigration and Ethnic Affairs v Wu Shan Liang [1996] HCA 6; (1996) 185 CLR 259 New South Wales Land and Housing Corporation v Orr [2019] NSWCA 231 Pollard v RRR Corp [2009] NSWCA 110 Soliman v University of Technology, Sydney [2012] FCAFC 146 Susan Elizabeth Parker v Margaret Catherine Higgins & Ors [2012] NSWSC 1516 Ward v Ward (No 2) [2011] NSWSC 1292 Watson & 2 Ors v Watson [2002] NSWSC 919 Texts Cited: G D Dal Pont, Powers of Attorney, LexisNexis Butterworths Australia, 2015 Category: Principal judgment Parties: ZMQ (Appellant) ZMR (First Respondent) ZMS (Second Respondent) Representation: Counsel: P Barham (Appellant) M Higgins (Second Respondent) Solicitors: Secure Legal Pty Ltd (Appellant) No Appearance (First Respondent) Mark Mulock & Co (Second Respondent) File Number(s): AP 19/34290 Publication restriction: The publication of the name of any of the parties or other people referred to in this decision including the publication of any information, picture or other material that identifies them, or is likely to lead to their identification, is prohibited. Decision under appeal Court or tribunal: NSW Civil and Administrative Tribunal Jurisdiction: Guardianship Division Citation: N/A Date of Decision: 11 June 2019 Before: J D'Arcy, Senior Member (Legal)SL Thompson, Senior Member (Professional)DR Sword (General Member) File Number(s): 2018/003358084 REASONS FOR DECISION 1. On 1 March 2017, 89-year-old ZMS (the Subject Person) executed an enduring power of attorney (the EPoA), appointing his cousin, ZMR, as his attorney (the Attorney). In addition, on the same day, he appointed the Attorney as his enduring guardian under a separate instrument. The Subject Person has a diagnosis of dementia and is residing in residential aged care. 2. Since the early 1960s, the Subject Person has owned a property on the outskirts of Sydney, comprising farmland, bushland and a sandstone quarry (the Property). In late 2018, the Attorney decided to sell that part of the Property on which the quarry was located, an area of approximately 76ha (the Quarry), to the then lessee of the Quarry. The Subject Person's son, ZMQ, the Appellant in these proceedings, objected to that decision and on 1 November 2018 lodged an application with the NSW Civil and Administrative Tribunal (NCAT) seeking review of the EPoA (the initiating application). In that application, the Appellant sought several orders, including the removal of the Attorney from his office and the production by the Attorney of records and accounts relating to the exercise of his powers under the EPoA. 3. In a separate application filed on the same day, the Appellant sought a review of the enduring guardian appointment made by the Subject Person. He subsequently withdrew that application, with the consent of the Tribunal. 4. At a hearing on 11 June 2019, the Tribunal conducted a review of the operation and effect of the EPoA and decided to dismiss the initiating application. 5. The Appellant now appeals that decision. The substance of the appeal is the Tribunal's purported failure to consider and determine the Appellant's request for orders requiring the Attorney to produce records and accounts relating to the exercise of his power under the EPoA and, in the alternative, failure to give adequate reasons for declining to exercise its power to make such orders. 6. For the reasons that follow, we have decided to dismiss the appeal. Publication of the names of the parties 1. The publication or broadcast of the name of any person mentioned, or otherwise involved, in an "internal appeal" against decisions made by the Guardianship Division of NCAT is prohibited: ss 65(1) and 65(2) of the Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act). Being an official report of the appeal proceedings, that prohibition does not apply to these reasons: s 65(3) of the NCAT Act. Nonetheless, because of the sensitive nature of the matters discussed in these reasons, we will not refer to the parties by name. 2. In this appeal, the Registrar assigned pseudonyms to the parties: "ZMQ" (the Appellant and Subject Person's son), "ZMR" (the Attorney appointed by the Subject Person) and "ZMS" (the Subject Person). For ease of reading, in these reasons we will not refer to the parties by pseudonyms. Grounds of appeal 1. The Appellant has a right to appeal against a decision made by the Tribunal on any question of law or, with the leave of the Appeal Panel, on any other ground: s 80(2)(b) of the NCAT Act. 2. At the hearing of the appeal, the Appellant informed the Appeal Panel that he no longer sought to challenge the decision by the Tribunal not to exercise the power to remove the Attorney from office. The Appellant said the only orders he sought were orders requiring the Attorney to furnish to the Appellant all accounts and records relating to the exercise of his power under the EPoA and an audit of those records and accounts: (see Notice of Appeal proposed orders 4 and 5). In addition, the Appellant advised that he had abandoned several of the grounds of appeal listed in the Notice of Appeal. 3. We understand the purported questions of law identified by the Appellant in the revised grounds of appeal to be: 1. Whether the Tribunal failed to consider and determine the Appellant's request that it exercise its power under s 36(4)(e) of the Powers of Attorney Act 2003 (NSW) to, among other things, order the Attorney to give to the Appellant all accounts and records relating to the exercise of his power under the EPoA. 2. If, contrary to the Appellant's contention, the Appeal Panel finds that the Tribunal considered and determined that request, whether the Tribunal failed to give adequate reasons for declining to exercise its power under s 36(4)(e) of the Powers of Attorney Act. 3. Whether the Tribunal had regard to an "irrelevant consideration", namely, the Appellant's motivation for making the initiating application and/or the likelihood of the requested financial information being used in foreshadowed proceedings in the NSW Supreme Court to "reverse the sale". 4. Whether the Tribunal failed to take into account the "timing of when liabilities of the [Subject Person] would fall due". 5. Whether the Tribunal placed "inordinate weight" on the Subject Person's expression of support for the actions of the Attorney, specifically his decision to sell the Quarry. Statutory framework 1. On the application of an "interested person", a review tribunal (the Supreme Court or NCAT) may decide to review the operation and effect of a "reviewable power of attorney", or to not carry out such a review: s 36(1) of the Powers of Attorney Act. In that Act, a "reviewable power of attorney" includes an "enduring power of attorney": ss 33(1), 33(2). An enduring power of attorney is an instrument, "expressed to be given with the intention that it will continue to be effective even if the principal lacks capacity through loss of mental capacity after execution of the instrument": s 19(1). 2. Section 36 of the Powers of Attorney Act provides: 36 Interested persons may apply for review (1) Tribunal may review making or operation and effect of power A review tribunal may, on the application of an interested person, decide to review the making, revocation or the operation and effect of a reviewable power of attorney or not to carry out such a review. (2) As a consequence of reviewing the making, revocation or operation and effect of a reviewable power of attorney, a review tribunal may decide whether or not to make an order under this section. … (4) Orders relating to operation and effect of power A review tribunal may, if satisfied that it would be in the best interests of the principal to do so or that it would better reflect the wishes of the principal, make any one or more of the following orders relating to the operation and effect of a power of attorney: (a) an order varying a term of, or a power conferred by, the power of attorney, (b) an order removing a person from office as an attorney, (c) 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, (d) an order reinstating a power of attorney that has lapsed by reason of any vacancy in the office of an attorney and appointing a substitute attorney to replace the attorney who vacated office, (e) an order directing or requiring any one or more of the following: (i) that an attorney furnish accounts and other information to the tribunal or to a person nominated by the tribunal, (ii) that an attorney lodge with the tribunal a copy of all records and accounts kept by the attorney of dealings and transactions made by the attorney under the power, (iii) that those records and accounts be audited by an auditor appointed by the tribunal and that a copy of the report of the auditor be furnished to the tribunal, (iv) that the attorney submit a plan of financial management to the tribunal for approval, (f) an order revoking all or part of the power of attorney, (g) such other orders as the review tribunal thinks fit. … (6) Effect of order declaring mental incapacity for the time being If a review tribunal makes an order under this section declaring that a principal under a reviewable power of attorney lacks capacity through mental incapacity for the time being, the principal is to be taken, for the purposes of the operation of the power of attorney, to lack such capacity for such period (if any) specified in the order or until further order of the tribunal. (7) Orders may be subject to terms and conditions An order made under this section may be made subject to such terms and conditions as the review tribunal thinks fit. (8) Further orders relating to accounts and information If a review tribunal makes an order under this section directing an attorney to furnish accounts or other information, the tribunal may decide to make further orders for: (a) limiting the disclosure of accounts or other information by the attorney, and (b) inquiry and report on the conduct of the attorney. … 1. In addition, if on review of the operation and effect of a reviewable power of attorney, the review 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 the circumstances to do so) decide to treat that application for review as an application for a financial management order under Part 3A of the Guardianship Act: s 37(1) of the Powers of Attorney Act; s 25F(d) of the Guardianship Act. The Tribunal's Decision 1. In 2015, the Subject Person's former wife commenced proceedings against the Subject Person in the Family Court of Australia. In February 2018 the proceedings were settled and the Family Court entered consent orders which required the Subject Person: 1. to pay to his former wife the total amount of $2.65m; $300,000 payable by 6 March 2018 and the balance payable by 13 August 2018, and 2. in default of payment by 13 August 2018, to sell the Property on the open market. 1. As noted above, in June 2019, after conducting a hearing the Tribunal dismissed the initiating application. In its reasons at [29], the Tribunal recorded the Appellant's stated belief that the decision to sell the Quarry was "unnecessary, against his father's wishes and not in his father's best interests" and that the Attorney's actions had "caused family conflict". The Tribunal detailed at [35] the concerns raised by the Appellant about the sale and several alternatives to that sale that he proposed. 2. At [45]-[53], the Tribunal set out the Attorney's response to those concerns together with a summary of a statement prepared by the Attorney itemising the Subject Person's debts and expenses. The Tribunal noted at [50] the explanation given by the Attorney for his decision to sell the Quarry: the level of the Subject Person's debt, which he estimated to be about $490,000 (including $350,000 estimated to be payable by the Subject Person to the Australian Taxation Office (ATO) and $142,000 payable to the Subject Person's former wife); the shortfall between that debt and the income expected to be generated by the Subject Person's estate over the next 12 months, including royalty payments generated by the Quarry; the alleged decision made by the Subject Person's bank to refuse the Attorney's application for a loan to discharge the Subject Person's debt; the legal advice claimed to have been received by the Attorney to the effect that an application seeking that the orders entered by the Family Court be varied by extending the deadline for payment to the Subject Person's wife, was likely to be expensive and may not be successful. 3. The Tribunal set out the views of the Subject Person at [54]-[58], which were to the effect that he was satisfied with the decisions made by the Attorney, supported the Attorney continuing in that role, and that he opposed the appointment of the alternative attorney nominated by the Appellant. 4. Under the heading "the Tribunal's findings", the Tribunal set out its reasons for deciding to dismiss the initiating application: 59 The Tribunal has carefully reviewed the decisions made by [the Attorney] as attorney and is satisfied that the decisions that he took about the sale of part of [the Property] were taken on the advice of the legal representatives acting for [the Subject Person] in the Family Court proceedings and in consideration of [the Subject Person's] best interests to avoid the whole of [the Property] being sold by public auction. 60 [The Attorney] has extensive knowledge of [the Subject Person's] assets and liabilities over many years. In addition to making reasonable decisions to manage the property settlement and to pay [the Subject Person's former wife] $2.65 million within the required timeframe, he also took into account [the Subject Person] future costs and needs. He considered alternatives and options to the sale of part of [the Property] including approaching [the Subject Person's] bank for a bank loan. Plans for a subdivision were defeated by the time constraints imposed by the Family Court. Approaches to the Family Court for variation of the order or an extension of time to finalise the property settlement would have incurred additional costs for [the Subject Person] and would not have necessarily achieved the desired results. 61 The Tribunal noted that many of [the Appellant's] submissions were based on his understanding that there was a minimal payment of around $20,000 owing to [the Subject Person's former wife]. The Tribunal accepted [the Attorney]'s calculations that the amount owing to [the Subject Person's former wife] was $141,847; and that [the Subject Person's] total debts including capital gains and personal tax was $484,927. Income from royalties and rent would not have been sufficient to meet the debts in the required timeframe. 62 [The Attorney] has ensured that, despite the sale of part of [the Property], [the Subject Person] retains around $6 million in assets and the interest on his term deposit will meet his annual accommodation fees. He has met his debt to his wife and has no other debts. [The Subject Person] has sufficient assets and income to be financially comfortable at this age and stage in his life. 63 [The Attorney] has the requisite skills, expertise and experience as a chartered accountant to be able to manage [the Subject Person's] financial affairs. He has received no remuneration for his work and has provided around $20,000 of billable hours in managing [the Subject Person's] affairs in addition to numerous trips to the Family Court in Newcastle. He has displayed due diligence and acted in a competent and professional manner. He has consulted with [the Subject Person] in all of the decisions that he has taken about the property settlement. He has attempted to involve and consult with [the Appellant and his brother], although it was not necessary for him to do so. 64 Any outcome that would result in a review of all of [the Attorney]'s decisions and transactions and result in action in the Supreme Court would not only create further conflict and distress for [the Subject Person] but would result in significant costs to [the Subject Person], without any potential benefit to him during his lifetime. 65 [The Subject Person] is strongly supportive of [the Attorney] remaining as his attorney and he has been consistently and firmly opposed to any change in the status quo from the commencement of these proceedings. The Tribunal gave considerable weight to his opinions which have been consistent throughout these proceedings. 66 There is no doubt that [the Appellant and his brother] are motivated in part by their father's best interests. However their comments and the comments by [the Appellant and the person he proposed as his father's financial manager] in the course of the hearing indicated to the Tribunal that their concerns about the sale of part of [the Property] were based, in part, on the potential loss of income when they inherit the farm and not by their father's current financial position, which is very comfortable and which will amply cover his needs during his lifetime. 67 The submission that consideration would be given to taking action in the Supreme Court to reverse the sale of the farm is clearly not in [the Subject Person's] best interests when he has sufficient income and assets to meet his needs during his lifetime and when any such action would cause [the Subject Person] significant distress and result in the depletion of his income and assets in meeting the costs of such actions. It would undoubtedly cause additional conflict within the family. 68 To revoke an enduring power of attorney when the attorney has considered all of the available options, acted on available legal advice and consulted with the principal in making all of the decisions to the principal's satisfaction because of family conflict, which has not been generated by the attorney but rather by family members who are dissatisfied with the decisions made, would unduly and inappropriately fetter an attorney's decision-making and dissuade potential attorneys from undertaking this onerous role. 69 The Tribunal concluded that there was no basis on which to treat the application for review of the enduring power of attorney as an application for the appointment of a financial manager because there is a valid enduring power of attorney in existence and the attorney has been working diligently in [the Subject Person's] best interests. 70 The proposed financial manager, … although a successful businessman, is not a chartered accountant and he acknowledged that he does not have the same skills and experience to be able to undertake the role of managing [the Subject Person's] finances. Some of his comments in the hearing indicated that his focus may tend more towards maintaining assets for [the Appellant and his brother's] future use rather than focusing on [the Subject Person's] best interests. He stated that the farm should have been retained in the family to provide income for [the Subject Person's] children who currently do not have any income, indicating a significant conflict of interest. 71 Having carefully considered all of the evidence about the operation and effect of the enduring power of attorney, the Tribunal decided not to make an order under section 36, and also decided that it was not appropriate to treat the application for review as an application for a financial management order under Part 3A of the Guardianship Act. 72 The Tribunal dismissed the application. Ground 1: Failure to consider the request for orders under s 36(4)(e) of the Powers of Attorney Act 1. The primary ground of appeal is the Tribunal's purported failure to consider and determine the request made by the Appellant for orders under s 36(4)(e) of the Powers of Attorney Act requiring the Attorney, among other things, to produce records and accounts of all dealings relating to the exercise of his power under the EPoA (the request for production of financial documents). The Attorney agrees that the Tribunal was obliged to consider and determine that request but disputes the claim that the Tribunal failed to do so. 2. It is not in dispute that in the initiating application and in the course of the hearing to determine that application, the Appellant requested the Tribunal to make orders under s 36(4)(e). (See Transcript of Proceedings, Re: ZMQ, NCAT, Guardianship Division, J D'Arcy, SL Thompson, DR Sword, 11 June 2019, no 2018/00335084, pp 36, 37, 38.) The Tribunal referred to that request in its reasons at [7] and [30]: 7. On 1 November 2018 [the Appellant] … lodged an application for review of the enduring power of attorney seeking a review of the operation and effect of the power of attorney and orders that the attorney furnish accounts and records, an audit of the accounts and records and a plan of financial management. (Emphasis added.) … 43. [The Appellant] also sought orders for the production of documents and accounts concerning the sale of part of [the Property], to examine and explore the history of the sale and to consider whether the transactions should be reviewed and proceedings should be commenced in the Supreme Court to reverse the sale of [the Property]. 1. In support of the contention that the Tribunal failed to consider and determine the request for production of financial documents, the Appellant asserts that the section of the Tribunal's reasons headed, "The Tribunal's findings", at [59]-[72], contains no reference to that request. He contends that the concluding paragraphs of that section represents the "sum total" of the reasons given by the Tribunal about the request for the production of financial documents: 71 Having carefully considered all of the evidence about the operation and effect of the enduring power of attorney, the Tribunal decided not to make an order under section 36, and also decided that it was not appropriate to treat the application for review as an application for a financial management order under Part 3A of the Guardianship Act. 72 The Tribunal dismissed the application. 1. While conceding that the Tribunal in its reasons did not explicitly address the financial documents request, the Attorney contends that the Tribunal was not required to do so having concluded that the pre-condition to the exercise of the power to make orders under s 36(4) — that it "would be in the best interests of the principal to do so or that it would better reflect the wishes of the principal" — had not been satisfied. The Attorney points out that the Tribunal concluded at [65] that the Subject Person "is strongly supportive of [the Attorney] remaining as his attorney and he has been consistently and firmly opposed to any change in the status quo from the commencement of these proceedings" (emphasis added). In addition, the Attorney points to the finding made by the Tribunal at [63], that the Attorney "displayed due diligence and acted in a competent and professional manner [and] consulted with [the Subject Person] in all of the decisions that he has taken about the property settlement". 2. Finally, the Attorney rejects the Appellant's contention that paragraph [71] of the reasons represents the "sum total" of the Tribunal's reasoning in relation to the request for production of financial documents. The Attorney contends that the reasons given by the Tribunal for not removing the Attorney from his role apply equally to its decision to not require him to produce records and accounts. The Attorney rejects the Appellant's assertion that the Tribunal failed to explain "why persons interested should not have access to relevant documents", contending that the Tribunal did precisely that by explaining why there was no reason to change the current arrangements. Consideration 1. To put the submissions made by the parties in context, it is useful to consider the statutory framework that governs the exercise of the power to make the orders sought by the Appellant. As explained by Slattery J in Susan Elizabeth Parker v Margaret Catherine Higgins & Ors [2012] NSWSC 1516 at [42], ss 36(1) and 36(2) of the Powers of Attorney Act give the review tribunal, here NCAT, a two-step discretion. The review tribunal may first exercise a discretion to "decide to review" the operation and effect of a reviewable power of attorney or "not to carry out such a review": s 36(1). If the review tribunal decides to exercise that discretion, it may exercise a further discretion, "whether or not to make an order" under [s 36]": s 36(2). Where, as here, the review relates to the operation and effect of the power of attorney, "if satisfied that it would be in the best interests of the principal to do so or that it would better reflect the wishes of the principal", the review tribunal may make any one or more of the orders listed in s 36(4). Those orders include orders of the type sought by the Appellant, "an order directing or requiring … that an attorney furnish accounts and other information to the tribunal or to a person nominated by the tribunal": s 36(4)(e)(i). In addition, s 36 gives the review tribunal broad power to make consequential orders following upon orders for the furnishing of accounts or other information: ss 36(7) and 36(8). 2. The Powers of Attorney Act does not expressly state the considerations relevant to the exercise of the discretion conferred by s 36(2). However, as pointed out by Slattery J in Susan Elizabeth Parker at [110], where, as here, the review relates to the operation and effect of a reviewable power of attorney, s 36(4) gives guidance as to the exercise of that discretion. The preamble to that sub-section requires the review tribunal to be satisfied that "it would be in the best interests of the principal to do so" or that "it would better reflect the wishes of the principal", before making any one or more of the orders listed in that sub-section. 3. The Appellant characterised the purported question of law, said to be raised by this ground, in various ways: whether the Tribunal failed to consider and determine the request for the production of financial documents, failed to consider the arguments advanced in support of that request, and mistook the question it was being asked to decide. We accept that where, as here, an applicant requests a review tribunal not only to exercise the discretion conferred by s 36(2) to make orders under s 36, but to make a particular form of order(s), a failure to consider and determine that request may amount to a failure to address the substance of the applicant's case and involve a constructive failure to exercise the function conferred by the Powers of Attorney Act: Dranichnikov v Minister for Immigration and Multicultural Affairs [2003] HCA 26; 77 ALJR 1088 at [24], [25]; Ali v AAI Limited [2016] NSWCA 110 at [66]. Accordingly, the question we must determine is whether, as the Appellant contends, the Tribunal failed to consider and determine the request to produce financial documents. 4. There can be no argument that the primary focus of the Tribunal's reasons was the question of whether it was appropriate to exercise the discretion conferred by s 36(4)(a) to remove the Attorney from office. That is unremarkable given that this was the focus of the submissions made by the Appellant in the proceedings before the Tribunal. Indeed, in the proceedings below, the Appellant's detailed written submissions not only contain no arguments in support of the request for orders for the production of financial documents, but do not list that as one of the requested orders: see Appellant's submissions (undated), filed in proceedings 2018/00335084, page 1. In oral submissions, the Appellant stated that if the Tribunal refused to grant his primary application, that is, the revocation of the appointment of the Attorney, he sought as an alternative, orders for the production of financial documents. However, he did not elaborate on the basis for that request or advance any argument in support: see Transcript of Proceedings, Re: ZMQ, NCAT, Guardianship Division, J D'Arcy, SL Thompson, DR Sword, 11 June 2019, No. 2018/00335084, pp 36, 37. 5. For the following reasons, we reject the Appellant's contention that the Tribunal failed to consider and determine the request for production of financial documents. First, it is to be recalled that the primary reason advanced by the Appellant for disturbing the EPoA was the contention that the sale of the Quarry was both unnecessary and contrary to the Subject Person's interests. The Tribunal rejected that contention, finding the sale of the Quarry was a decision taken in consideration of the Subject Person's "best interests to avoid the whole of [the Property] being sold by public auction": at [59]. Noting that the Attorney had "extensive knowledge of [the Subject Person's] assets and liabilities over many years", the Tribunal found at [63] that the Attorney had made reasonable decisions in managing the property settlement with the Subject Person's wife and arranging for the $2.65m payable to her under the terms of that settlement to be paid by the mandated deadline. 6. Second, while not put in these terms, it is apparent from the reasons read as a whole, that the Tribunal was not satisfied that either of the pre-conditions to the exercise of the discretion to make orders under s 36(4) were met. This is apparent from the favourable findings made by the Tribunal about the manner in which the Attorney had discharged the duties of his role, including at [63] that he had "the requisite skills, expertise and experience as a chartered accountant to be able to manage [the Subject Person's] financial affairs"; and had "displayed due diligence and acted in a competent and professional manner … had consulted with [the Subject Person] in all of the decisions that he has taken about the property settlement … attempted to involve and consult [the Subject Person's sons] although he was not required to do so". With respect to the second pre-condition ─ that making an order(s) would better reflect the wishes of the Subject Person ─ it is apparent that the Tribunal addressed that issue. The Tribunal noted at [65] that the Subject Person is "strongly supportive" of the Attorney continuing to act as his attorney and he has been "consistently and firmly opposed to any change in the status quo from the commencement of these proceedings". It follows that it was not open to the Tribunal to proceed to make orders under that s 36(4), be they orders revoking the appointment of the Attorney or requiring the Attorney to produce financial documents. 7. Self-evidently, in deciding whether it would be in the best interests of the principal or better reflect the wishes of the principal to exercise the power to make orders under s 36(4), different considerations may apply in light of the particular form of order sought. A finding that it would not be in the best interests of the principal to revoke the appointment of an attorney does not preclude a finding that it would be in the best interests of the principal to order the Attorney to produce financial documents, and vice versa. The same applies to the assessment of the second pre-condition to the exercise of the power in s 36(4). However, while in this Appeal the Appellant put forward several arguments specific to the request for production of financial documents, he did not do so in the proceedings before the Tribunal. There the gist of his argument was that the sale of the Quarry evidenced the Attorney's unsuitability to continue in his role. 8. Third, contrary to the submissions made by the Appellant, in our view the Tribunal expressly considered his request for production of financial documents. Read in context, the statement made by the Tribunal at [64] ─ "any outcome that would result in a review of all of [the Subject Person's] decisions and transactions and result in action in the Supreme Court" ─ is plainly a reference to the Appellant's request for orders under s 36(4)(e) and not to his primary application for the removal of the Attorney. This paragraph indicates that the Tribunal considered that application and concluded, that acceding to the request for production of financial document may result in the foreshadowed Supreme Court proceedings to "reverse the sale" of the Quarry. The Tribunal reasoned at [64] that such action would "not only create further conflict and distress for [the Subject Person] but would result in significant costs to [the Subject Person], without any potential benefit to him during his lifetime". 9. We reject the contention that the Tribunal failed to consider and determine the claim for orders seeking production of financial documents. This ground of appeal must be dismissed. Ground 2: Did the Tribunal fail to give adequate reasons for declining to exercise its power under s 36(4)(e)? 1. The Appellant contends that the Tribunal failed to discharge its statutory duty to set out the reasoning processes that led it to decline to exercise its power to order the Attorney to produce financial documents. The Attorney disagrees, contending that while the reasons given by the Tribunal for declining to exercise that power were not extensive, nonetheless, they were adequate. 2. The Appellant contends that the fact that the question of whether the Tribunal had considered and determined his request for the production of financial documents was a live issue in this appeal, evidences that the Tribunal failed to give adequate reasons for its decision. He asserts that the "sum total" of the Tribunal's reasons for its decision in respect of the "section 36 issue" can be found at paragraph [71] of the reasons (reproduced at [19] above). He contends that this passage falls well short of meeting the obligation imposed by s 62(3) of the NCAT Act, to set out "the reasoning processes that lead the Tribunal to the conclusions it made", citing in support the comments made by McColl J A (Ipp JA, Bryson AJA agreeing) in Pollard v RRR Corp [2009] NSWCA 110 at [56]-[67] and BTH v The Public Guardian [2017] NSWCATAP 10. 3. While acknowledging that the statutory obligation imposed by s 62(3) of the NCAT Act did not require the Tribunal to spell out every detail of its reasoning process in respect of each finding, the Appellant submits that it nonetheless required the Tribunal to expose its reasons for resolving points critical to the contest between parties. The Appellant contends that in respect of its decision to decline to exercise the power to make orders under s 36(4)(e), the Tribunal failed to expose its reasoning process. 4. The Attorney disputes the contention that the "sum total" of the Tribunal's reasons in relation to the request for financial documents is contained in paragraph [71] of the reasons. The Attorney contends that the reasons given by the Tribunal for not removing him from his role apply equally to its decision to not exercise the power to order him to produce records and accounts and that to satisfy the obligation to provide adequate reasons, the Tribunal was not required to repeat its reasons. The nature of the obligation imposed by s 62 of the NCAT Act 1. The Tribunal was required to give the parties a written statement of reasons for its decision: cl 11(1) of Sch 6 to the NCAT Act. In that statement, the Tribunal was required to set out the matters referred to in s 62(3) of the NCAT Act: cl 11(3) of Sch 6 to the NCAT Act. Section 62(3) states: (3) A written statement of reasons for the purposes of this section must set out the following: (a) the findings on material questions of fact, referring to the evidence or other material on which those findings were based, (b) the Tribunal's understanding of the applicable law, (c) the reasoning processes that lead the Tribunal to the conclusions it made. 1. In New South Wales Land and Housing Corporation v Orr [2019] NSWCA 231 (Orr), Bell P distilled at [66]-[70] the following principles as to what constitutes adequate reasons in the case of a tribunal, such as NCAT: [66] In the context of appellate review of the adequacy of reasons, the function of an appellate court is to determine not the optimal level of detail required in reasons for a decision but rather the minimum acceptable standard: Resource Pacific Pty Ltd v Wilkinson [2013] NSWCA 33 at [48] (Resource Pacific). The standard is not one of perfection: Bisley Investment Corporation v Australian Broadcasting Tribunal (1982) 40 ALR 233 at 255 (Bisley). [67] Whilst all decision makers, be they judges or tribunal members, should aspire to high quality decision making, an integral part of which is the formulation of clear reasons for decision (as Gleeson CJ explained extra-judicially in "Judicial Accountability" (1995) The Judicial Review 117 at 122), as Basten JA said in Resource Pacific at [48], "[t]ransparency in decision-making is an important value, but it is not cost free, and may involve separate parameters of quantity and quality." His Honour's identification of separate parameters of quantity and quality is, with respect, a useful one. [68] In terms of the former parameter, the quantity (or detail) of reasons, necessary for those reasons to be adequate may vary both with the nature of the decision maker, i.e. whether or not it is a court of tribunal, and, if the latter, possibly the type of tribunal, and the nature of the question being decided: Wainohu v New South Wales (2011) 243 CLR 181; [2011] HCA 24 at [56] per French CJ and Kiefel J (Wainohu). … [69] An important question which is raised by the present case concerns the detail of reasons required of NCAT for a discretionary decision, particularly bearing in mind that there is no right of appeal from the Tribunal's decision other than on a question of law (although a broader appeal may be permitted with leave of the Appeal Panel): see [30] above. [70] As to the latter parameter identified by Basten JA in Resource Pacific, namely the quality of reasons, it is generally accepted that the sheer volume of work undertaken by tribunals is such that a perhaps more relaxed standard of review of reasons with corresponding compensation for linguistic infelicities is appropriate than may be the case when an appellate court is hearing an appeal from another court. 1. The President went on to note that statements from well-known administrative law decisions relating to the limits of judicial review and the need for practical as well as principled restraint provide further guidance about what constitutes adequate reasoning on the part of a tribunal. The President explained at [77] that those principles include: (i) "Decision-makers commonly express their reasons sequentially; but that does not mean that they decide each factual issue in isolation from the others. Ordinarily they review the whole of the evidence, and consider all issues of fact, before they write anything. Expression of conclusions in a certain sequence does not indicate a failure to consider the evidence as a whole": Re Minister for Immigration and Multicultural Affairs, Re; Ex parte Applicant S20/2002; Appellant S106/2002 v Minister for Immigration and Multicultural Affairs [2003] HCA 30; 77 ALJR 1165 per Gleeson CJ at [14] (Ex parte Applicant); (ii) the court should not read passages from the reasons for decision in isolation from others to which they may be related: Re Maria Politis v Commissioner of Taxation [1988] FCA 739 at [14]; [1988] FCA 446; 20 ATR 108 at 111; (iii) the reasons must be read fairly and as a whole: Ex parte Applicant at [147] per Kirby J; Wu Shan Liang at 291; Bisley at 251; (iv) the reasons recorded ought not to be inspected with a fine tooth-comb attuned to identifying error: Collector of Customs v Pozzolanic Enterprises Pty Ltd [1993] FCA 456; (1993) 43 FCR 280 at 287; [1993] FCA 456 (Pozzolanic) at 287; Wu Shan Liang at 272, 291; (v) there should be a degree of tolerance for looseness in the language of the tribunal, unhappy phrasing of the tribunal's thoughts or verbal slips: Pozzolanic at 287, Wu Shu Liang at 272 and 291. Consideration 1. Applying those principles, we consider whether, as the Appellant asserts, the Tribunal failed as required by s 62(3) of the NCAT Act to set out the reasoning process that lead it to decide not to exercise the power to make orders under s 36(4)(e). 2. If, as the Appellant contends, the "sum total" of the reasons given by the Tribunal for deciding not to exercise that power had been contained in paragraph [71], we would agree with the proposition that the reasons fail to meet the statutory obligation imposed by s 62(3). A formulaic recitation of the type contained in [71] — "Having carefully considered all of the evidence about the operation and effect of the enduring power of attorney, the Tribunal decided not to make an order under section 36" — falls short of the requirement imposed by s 62(3) of the NCAT Act. 3. However, the approach the Appellant urges us to take is, in our view, inconsistent with the authorities, which have consistently emphasised that in undertaking the task of evaluating whether reasons for decision are adequate, an appellate body, such as this Appeal Panel, must refrain from reading passages from the reasons for decision in isolation from others. Reasons must be read fairly and as a whole. In addition, they should not be read with an "eye keenly attuned to error" (Minister for Immigration and Ethnic Affairs v Wu Shan Liang [1996] HCA 6; (1996) 185 CLR 259 at 271-272). Of course, at the same time, the eyes of the appellate body should not be "so blinkered as to avoid discerning an absence of reasons" (Soliman v University of Technology, Sydney [2012] FCAFC 146 at [57]). 4. In our opinion, read fairly and in its context, paragraph [71] does not represent the "sum total" of the reasons given by the Tribunal for deciding to dismiss the application, and specifically, not to exercise the power to require the Attorney to produce financial documents. The reasons contain a careful analysis of the concerns raised by the Appellant about the operation and effect of the EPoA. The Tribunal went on to apply that analysis in considering whether to exercise the discretion to review the operation and effect of the EPoA, and, in turn, to make orders under s 36. The reasons reveal that the Tribunal rejected the proposition that the sale of the Quarry evidenced that the Attorney had failed to discharge his role in a manner consistent with his fiduciary duties and found that he had discharged those duties in a competent and diligent manner. While there can be no argument that the focus of the Tribunal's reasons was the question of whether or not to exercise the power to make orders to revoke the Attorney's appointment, read as a whole, and having regard in particular to paragraph [68], the reasons reveal that the Tribunal went on to consider and determine not only that question but also whether to exercise the power to require the production of financial documents. While the reasons specific to the latter were brief, they nonetheless in our opinion exposed the reasoning process which led the Tribunal to that decision. 5. Finally, we observe that the Appellant appears to suggest that the Tribunal failed to engage with and address the submissions he advanced about the request to produce financial documents. As noted above at [28], the Appellant did not advance any specific submissions in support of that request in the course of the proceedings before the Tribunal. 6. We are not persuaded that the Tribunal failed to set out the reasoning processes, as required by s 62(3) that led it to decline to exercise the power to make orders under s 36(4)(e). This ground of appeal must be rejected. Ground 3: Did the Tribunal have regard to an "irrelevant consideration", namely, the Appellant's motivation for making the initiating application and/or the likelihood of the requested financial information being used in foreshadowed proceedings in the NSW Supreme Court to "reverse the sale"? 1. In written submissions in support of the appeal, the Appellant argued that in taking into account his motivation for making the initiating application (his alleged interest in preserving his and his brother's inheritance) and the reason for seeking the production of financial documents (for alleged use in proceedings in the NSW Supreme Court), the Tribunal had regard to "irrelevant considerations", in the sense that term was described by Mason J in Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; 162 CLR 24 at 39. See also, Lo v Chief Commissioner of State Revenue [2013] NSWCA 180; (2013) 85 NSWLR 86 at [9] per Basten JA. 2. As properly conceded by the Appellant in oral submissions, the terms of s 36 did not expressly or implicitly prohibit the Tribunal from taking into account either of these considerations. Despite this concession, the Appellant nonetheless contended that the Tribunal erred in having regard to the possibility that the requested documents might be used in Supreme Court proceedings to "reverse the sale" of the Quarry. He contended that the foreshadowed proceedings were at best a mere possibility, especially given the Tribunal's decision not to appoint the Appellant's nominee as attorney, and by relying on that possibility the Tribunal had created a "straw man". 3. With respect to the Appellant's motivation for making the initiating application, the Tribunal's reasons reveal that while the Tribunal considered that the Appellant was in part motivated by self-interest, it did not consider this to be his sole motivation. Notably, the Tribunal did not dismiss the Appellant's stated concerns on this account. This is evidenced by the Tribunal's actions in exercising the discretion to review the operation and effect of the EPoA and its consideration of the concerns the Appellant raised about the conduct of the Attorney, specifically the decision to sell the Quarry: see [66]. 4. We are unable to agree with the proposition that the Tribunal was not entitled to have regard to the possibility of the foreshadowed Supreme Court proceedings because, at the time of the hearing, such proceedings were a "mere possibility". The exercise of the power to make or not to make orders under s 36(4) required the Tribunal to consider whether to make, or not to make, the proposed order was in the best interests of the Subject Person. That required the Tribunal to consider the Subject Person's current and future interests. We are unable to agree with the proposition that in assessing the latter, the Tribunal was restricted to having regard to future events that were reasonably certain. In circumstances where the possibility of Supreme Court proceedings had been squarely raised by the Appellant, we reject the proposition that it was impermissible for the Tribunal to have regard to that possibility. 5. This ground of appeal must be rejected. Ground 4: Did the Tribunal fail to take into account the "timing of when liabilities of the [Subject Person] would fall due"? 1. The Appellant contends that the Tribunal erred in accepting the explanation given by the Attorney for his decision to sell the Quarry, that is, to meet the debts payable by the Subject Person and to avoid the forced sale of the whole of the Property. Under the consent orders entered by the Family Court, if the Subject Person failed to pay his former wife $2,650,000 by the prescribed deadline, the Subject Person not only would become liable to pay interest to his former wife but that default would trigger a sale of the whole of the Property on the open market. The Appellant contended that the sale of the Quarry, which he described as a "highly unusual transaction", was not the only option available to the Attorney to meet the Subject Person's debts. In short, he contended that the sale of the Quarry (which had been generating an annual income of about $360,000) was unnecessary and precipitous, and, as he put it in the Appeal, it was the equivalent to "cooking the goose that laid the golden egg". In addition, the Appellant contends that the Tribunal erred in accepting the factual assumptions made by the Attorney, on which his decision to sell the Quarry was based. 2. In addition, the Appellant asserts that the legal advice the Attorney claimed to have received, which was said to be that it was unlikely that the Family Court would agree to vary the consent orders, was not "put into evidence". He asserts that, given the Subject Person's personal circumstances it is improbable that the Family Court would have ordered the sale of the Property, in default of payment to the Subject Person's wife by the prescribed deadline. In any event, he asserts, if that were to occur it would not have resulted in the "immediate sale" of the Property. In addition, he points out that no "accounting advice" was put into evidence about the likely response of the ATO if the Subject Person's tax liabilities were not paid on time. He asserts that it is a matter of "common knowledge" to which the Tribunal was entitled to have regard, that the ATO does not "routinely sue for judgment and then issue bankruptcy notices" where arrangements for payment are able to be made. With respect to the claim made by the Appellant that the Subject Person's bank refused to grant his application for a loan, the Appellant asks rhetorically "What financial institution would not lend $500,000 on assets worth in the millions, on an income of $360,000?". 3. Finally, the Appellant submits that the Subject Person has three children who will likely need to be provided for in due course and, while conceding that there is no evidence on this point, he asserts that like most testators, the Subject Person would wish to provide for his children. Consideration 1. In the Notice of Appeal, the error of law said to be raised by this ground was characterised as the purported failure to take into account a relevant consideration: the timing of when "the liabilities of the Subject Person would fall due". As developed in oral submissions, the Appellant appears to have abandoned that characterisation and to instead identify the purported error to be the making of a finding of fact — that given the nature of the Subject Person's debt the only feasible alternative available to the Attorney was the sale of the Quarry —for which there was no, or insufficient reliable evidence. 2. Before considering whether this ground raises an error of law, it is worthwhile to make some general observations about the role and obligations of an attorney and the role of the Tribunal in reviewing an enduring power of attorney. The relationship between an attorney and principal gives rise to fiduciary duties: Hospital Products Ltd v United States Surgical Corporation and Others [1984] HCA 64; (1985) 156 CLR 41; Ward v Ward (No 2) [2011] NSWSC 1292 at [3]. In the discharge of his or her role, an attorney is required to display undivided loyalty to, and to act in the best interests of, the principal, except to the extent that the instrument creating the relationship otherwise provides: Watson & 2 Ors v Watson [2002] NSWSC 919 at [48]; see also, G D Dal Pont, Powers of Attorney, LexisNexis Butterworths Australia, 2015 [8.34]-[8.37]. The Powers of Attorney Act does not affect the operation of these principles: s 7. It is through the prism of the fiduciary duties owed by the attorney to the principal that the Tribunal exercises its powers under Div 4 of Part 5 of the Powers of Attorney Act, in reviewing a reviewable power of attorney. 3. There is a suggestion running through the Appellant's submissions at first instance and on appeal, that unless the Attorney could demonstrate that the only feasible option to discharge the Subject Person's debts was to sell the Quarry, to do so would constitute a breach of his fiduciary duty. Likewise, he appears to suggest that to exercise the discretion to not make orders under s 36(2), the Tribunal was required to be satisfied that the sale was the only viable option open to the Attorney. In our view these submissions misapprehend the respective roles of both the Attorney and the Tribunal. The Attorney was not obliged to preserve the Subject Person's assets at all costs but rather to manage the estate in a competent and diligent manner having regard to the Subject Person's current and future needs for income. Similarly, the role of the Tribunal was not to decide for itself whether the sale of the property was the only or the preferable decision, but rather to evaluate whether the sale of the Quarry evidenced that the Attorney was not acting in a manner consistent with the duties he owed to the Subject Person and/or was not likely to do so in the future. It goes without saying that reasonable minds may differ about the best way to manage a person's estate. Generally, a range of decisions will be available to an attorney to discharge the responsibilities of their role in a manner consistent with the duties owed to the principal. 4. Turning now to the purported question of law, it could not be said that there was no evidence before the Tribunal about the factual assumptions which underpinned the explanation proffered by the Attorney for his decision to sell the Quarry. The material available to the Tribunal included the Attorney's account of the advice he had been given by the lawyers representing the Subject Person in the Family Law proceedings, the statement prepared by the Attorney setting out the Subject Person's tax liabilities, the explanation he gave to the Tribunal about those figures together with the account he gave about the loan application made to the Subject Person's bank. That there may have been better evidence available to support the claims made by the Attorney did not prevent the Tribunal from having regard to that material. As Hill J commented in Casey v Repatriation Commission (1995) 60 FCR 510 at 514 in relation to a broadly equivalent provision to s 38(2) of the NCAT Act (the Tribunal is not bound by the rules of evidence): The fact that material may be inadmissible in accordance with the law of evidence does not mean that it cannot be admitted into evidence by the Tribunal or taken into account by it. The criterion for admissibility of material in the Tribunal is not to be found within the interstices of the rules of evidence but within the limits of relevance." 1. The weight to be given to the available material was a matter for the Tribunal to decide. 2. This ground is in substance a challenge to the weight given by Tribunal to the available material. It does not give rise to an error of law. This ground of appeal is rejected. Ground 4: Did the Tribunal place "inordinate weight" on the Subject Person's expression of support for the actions of the Attorney, specifically his decision to sell the Quarry? 1. While conceding that the Subject Person's expression of support for the actions of the Attorney taken under the EPoA was not an irrelevant consideration, the Appellant contends that given the objective evidence concerning the Subject Person's "deteriorated mental condition", the Tribunal erred by placing "inordinate weight" on this consideration. 2. At the hearing on 11 June 2018, the Tribunal questioned the Subject Person about his views in relation to the sale of the Quarry and summarised the views he expressed in its reasons: 54 At the commencement of the hearing [the Subject Person] stated that he "wished to stick with [the Attorney]" because he appointed him due to his background and experience. He does not want [the Appellant] involved in his financial affairs. He did not see the need for the current proceedings. 55 [The Subject Person] stated that he was satisfied with all of the decisions made by [the Attorney]. He did not want any outsiders involved in his financial affairs. He wanted to keep his financial affairs within the family. He stated that he did not know his income and assets "off the top of his head" but understood the relevant paperwork when [the Attorney] discussed it with him. 56 [The Subject Person] acknowledged that he did not want to sell his houses or the quarry but he understood that he had to do so to pay for the property settlement and had to sell part of [the Property] otherwise the whole property would have gone to public auction. 1. At [36], the Tribunal recorded the Appellant's account of the Subject Person's views: [The Appellant] further submitted that it was [the Subject Person's] wish to retain the whole of [the Property] as indicated in emails from [the Attorney] to [the Appellant and his brother] dated 13 February 2018, 16 February 2018 and 6 July 2018 and in a submission to the Guardianship Division on 2 December 2018. He had a long history with the farm and he wanted to retain the property for his sons. 1. In the concluding paragraphs of its reasons, the Tribunal referred to the Subject Person's "strong support" for the Attorney and wrote that it gave "considerable weight to his opinions which have been consistent throughout these proceedings". 2. The Attorney contends that the argument put by the Appellant is inconsistent in that for "no clear reason" the Appellant places greater weight on some parts of the evidence concerning the Subject Person's "concerns and wishes" than others. The Attorney points out that the Subject Person's psychiatric conditions predate the hearing and there is no basis to contend that his previously expressed views (see [63] above) are "less tainted" by his condition than those he expressed at the hearing. Consideration 1. As the Appellant properly concedes, the Tribunal was not prohibited from taking into account the views expressed by the Subject Person. Indeed, his views both current and past, were relevant to the exercise of the discretions conferred by ss 36(2) and 36(4). The real complaint appears to be that the Tribunal gave greater weight to the Subject Person's expression of support for the actions taken by the Attorney than to his expressed view (past and current) that he wished to retain the whole of the Property. 2. The views of the Subject Person were one of several considerations the Tribunal had regard to in deciding whether to exercise its power to make orders under s 36(4). As discussed above, the Tribunal rejected the Appellant's estimate of the quantum of the Subject Person's debt and accepted the Attorney's account that the income generated by the Subject Person's estate would be insufficient to meet his debts of just under $500,000: [61]. In addition, the Tribunal found that even with the sale of the Quarry, the Subject Person would have sufficient assets and income "to be financially comfortable at this age and stage of his life". Further, the Tribunal found that the Attorney had the "requisite skills expertise and experience to be able to manage the Subject Person's affairs" and in undertaking that task had "displayed due diligence and acted in a competent and professional manner": [63]. 3. The Tribunal was alive to the fact that the sale of the Quarry was not the Subject Person's preferred option but one he reluctantly endorsed on the basis of the advice given by the Attorney. The Tribunal did not err in taking into account the wishes expressed by the Subject Person at the hearing. This ground of appeal must be rejected. Orders 1. The appeal is dismissed. ********** 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 Amendments 21 February 2020 - File number on coversheet corrected. 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: 21 February 2020