ADP [2015] QCAT 21

CITATION: ADP [2015] QCAT 21 PARTIES: ADP APPLICATION NUMBER: GAA9144-14 MATTER TYPE: Guardianship and administration matters for adults HEARING DATE: 14 January 2015 HEARD AT: Gold Coast DECISION OF: Member Mc Donald DELIVERED ON: 21 January 2015 DELIVERED AT: Brisbane ORDERS MADE: 1. The administration order made by the Tribunal on 11 April 2014 is changed by removing PDM and DAJ as administrators and appointing the Public Trustee of Queensland as administrator for ADP for all financial matters. 2. This appointment remains current until further order of the Tribunal. This appointment is reviewable and is to be reviewed in one (1) year. 3. The administrator is to provide a financial management plan to the Tribunal within four (4) months. 4. The Tribunal directs the administrator to provide accounts to the Tribunal when requested. 5. That before 21 April 2014 the administrator must: (a) Search the records of the Registrar of Titles to identify any property registered in the adult’s name. (b) Give the registrar of titles a copy of this order and a notice to the registrar advising that any interest in property held by the adult is subject to this order. (c) Give to the Tribunal: (i) a copy of the “Lodgement Summary Form” from the Titles -- 1 of 5 -- 2 registry confirming the notice has been lodged for each property held by the adult; and (ii) a copy of the current title searches. 6. If the ownership of any property of the adult changes in any way or the adult acquires an interest in another property the administrator must, within 14 days of such changes: (a) give a copy of this order to the Registrar of Titles and (b) give a notice to the Registrar about the changes or the adult’s interest in another property. CATCHWORDS: Suspended Administrator – non compliance with obligations to keep funds separate – obligations to act with diligence Guardianship and Administration Act 2000 ss 31, 35, 36, 37, 50 APPEARANCES: PDM, LK, KM REASONS FOR DECISION [1] PDM and DAJ were appointed jointly and severally for as administrators ADP for all financial matters on the 11 April 2014. On 7 October 2014 LK filed an application in the Tribunal seeking a review of this appointment, noting concerns that the administrator had not made payment of the nursing facilities invoices, and several direct debit requests had bounced. On 8 October 2014 the Tribunal suspended the administration appointment, placing the Public Trustee of Queensland as interim administrator until the matter could be heard. Technical difficulties with the applicant’s phone prevented the matter being heard on 11 December 2014. The application was adjourned to be heard on 14 January 2015. [2] PDM informed the Tribunal that ADP was diagnosed with dementia in 2013. He noted he had preceding health incidents which included stroke and diabetes. A Health Professional Report of Dr Brown dated 19 February 2013 confirms that as a result of dementia and a CVA, ADP has no insight into his physical limitations and is able to make only simple financial decisions. An occupational therapist report (author unstated) from Robina Hospital dated 17 February 2014 noted that in a January 2014 admission, ADP was deemed by the medical team to lack capacity, noting reduced insight into his capabilities. In an Allen’s Cognitive screen performed during this admission, he returned a score of 4, representing a need for 24 hour daily supervision and care due to cognitive deficits. -- 2 of 5 -- 3 [3] At the oral hearing, PDM indicated that ADP continues to be interested in his finances, although has no comprehension of his affairs. The Tribunal has considered the evidence indicates that the adult lacks capacity to manage his financial affairs and the presumption of capacity is therefore rebutted. [4] The applicant, LK indicated that the review request was triggered by the administrator failing to pay nursing home bills for several bill cycles. As a result the adult was unfunded in the nursing home for several months. He indicated that after this review application was put forward PDM rectified the outstanding bills which are now currently up to date. He considered that on this basis he did not consider that there was need to pursue the review, and he indicated that he had no further concerns about the administrator’s appointment. He confirmed that for the nursing centre the matter had been resolved. LK indicated that during the times that funds were outstanding, the owner spoke directly with PDM on a number of occasions who advised that funds would be forthcoming. He also gave evidence that outpatients appointments had been missed resulting in cancellation of appointments for surgery as a result of the unavailability of funds. Further, LK indicated that he was not been informed that DAJ had also been appointed co-administrator until the application had been put to the Tribunal. [5] PDM informed the Tribunal that he worked away a lot and was not receiving mail during that period. He indicated that when he became aware of the nursing home’s concerns he rectified by making payment of the outstanding amount. He stated that the time there had been family troubles which took priority, including his mother’s palliative diagnosis of cancer and his sister relocating to look after her. PDM informed the Tribunal that there was significant costs associated with these events, and the available funds were prioritised to deal with these family issues. PDM stated that he had used his father’s funds to pay for such family issues as transport for DAJ to relocate to look after PB. He confirmed that he had ‘robbed Peter to pay Paul’ given the extent of family crisis. He indicated that he had not sought approval for a conflict transaction and was not aware that he had to do so. He stated that he had not been told at the hearing in which he was appointed about the statutory obligations of administrators under the Guardianship and Administration Act 2000. [6] PDM stated that DAJ had some ‘health conditions’ and was not able to handles stress. She had been acting in the role in his view by visiting ADP. He denied that she had mental health problems, but claimed she had social issues but that he wanted her to remain as “back up” appointment. He stated he had been concerned about the frequent lost work to his business dealing with these issues. [7] The Tribunal notes that, in breach of section 36 of the Guardianship and Administration Act 2000, the administrators failed to lodge the notice of interest in land before 11 July 2014, in accordance with the order. Further the administrators failed to respond to an extension of this requirement until 24 August 2014 and ultimately did not file the lodgement -- 3 of 5 -- 4 summary of the notice of interest in land with the Tribunal until the end of September 2014, after multiple requests from the registry. PDM explained that there were significant stresses in his family at the time relating to his mother’s health and general state of family crisis. [8] PDM advised that he also administers his mother’s financial affairs. [9] The Public Trustee of Queensland was appointed during the period of suspension as interim administrator. The Public Trustee informed the Tribunal that they had significant difficulties gaining any co-operation from PDM in relation to ascertaining information about ADP’s affairs. They understand that most assets are owned jointly with PB. [10] The Public Trustee informed the Tribunal that a reverse mortgage of $25,000 was processed on the property since the administrators’ appointment. The funds went into ADP’s account on 24 July 2014. On that date $9,000 and $3,000 were separately withdrawn as lump sums. PDM stated that he had informed the Tribunal at the hearing of 11 December 2014 that these funds were for his mother’s health expenses. He said that he did not have the documentation to support this. [11] The Public Trustee also advised that 2 payments had been made to BBM Technology in the sum of $1,662, and $1,821. PDM advised that this was directed to a supplier of his business that he has a ‘joint ABN with his mother’. The Public Trustee further advised that there had also been a transfer of $1,469 to from this account to RM, the business he states that he operates with his mother, who is party to this account. PDM informed the Tribunal that he had to ‘get the family back to the situation they were in before’, and that he personally had lost hundreds and thousands of dollars looking after his father and the family. He denied that he had used the funds from his father’s account to compensate himself for this. However, the Tribunal notes that there is clear evidence that the administrators have made conflict transactions, directing the adult’s funds business interests of suppliers and business interests in breach of obligations under section 37 of the Guardianship and Administration Act 2000. It is noted this has occurred when the adult’s day to day expenses were not being met. [12] The Public Trustee noted several withdrawals on a daily of $500, $700, $300 and these remained unclear. PDM was given an opportunity to clarify this but did not respond. [13] The Public Trustee advised that the adult’s Commonwealth bank account had been depleted to nil and was in debit from July to September. PDM advised again that he ‘had to rob Peter to pay Paul’, and acknowledged that he had done things in an ‘unusual way’ but that the broader family needs necessitated this. The Public Trustee noted that ADP’s pension income had been going into ADP’s account and had been withdrawn during this period. This was this period that nursing home fees were outstanding. -- 4 of 5 -- 5 [14] The Guardianship and Administration Act 2000 specifies strict obligations for people who are charged with the responsibility of administering the affairs of a person who cannot manage their own due to incapacity. An administrator may enter conflict transactions only if they are authorised by the Tribunal, and have a duty to avoid a conflict of duty and interest otherwise. There has been no approval for the application of the adult’s funds to the business interests of PDM and PB. This is particularly concerning when the adult had outstanding debt for his day to day care of several months and more so where his accounts have been depleted to nil during that period. [15] Unfortunately PB did not participate in the hearing to provide a clearer picture to the Tribunal of the presenting concerns. PDM indicated that she had been stressed by the proceedings and she should be protected from the stresses of the dispute. The Tribunal notes communication from PB to the registry staff on 13 October 2014, where she stated that she had been terminally ill, but was now well and wanting to take on the management of her husband’s affairs. No application was ultimately received from PB. The Tribunal notes that PDM has advised the Tribunal that he is managing his mother’s affairs. [16] The Tribunal is not satisfied that the administrators have acted diligently in managing the adult’s affairs. The Tribunal accepts as PDM claims that this was a period of high crisis for the family, and that PDM claims he has worked for the collective interest of the family. However, there is evidence that the adult’s funds have without approval been applied in conflict of duty and interest, where the adult’s funds have been mixed with business interests of an administrator. There has also been an absence of diligence in compliance with obligations under the order. Further, the co- administrator is effectively not acting. [17] As a result the Tribunal finds the Administrators are not competent to act, having breached their obligations under the Guardianship and Administration Act 2000, and accordingly appoints the Public Trustee until further Order, to be reviewed in one year. -- 5 of 5 --