Brown v Sclavos & Anor [1999] QSC 233

I \. 36943 8(11 /~33 IN THE SUPREME COURT OF QUEENSLAND No. 2808 of 1985 Brisbane BETWEEN: PHILLIP ANTHONY WAYNE BROWN Plaintiff AND: MARY SCLAVOS Defendant AND: FIRE & ALL RISKS INSURANCE CO. LTD. Defendant by Election REASONS FOR JUDGMENT - HELMAN J. Judgment delivered 28 September 1999 CATCHWORDS: TRUSTS AND TRUSTEES - protection of person under a disability- whether a settlement should be sanctioned under s. 59 Public Trustee Act 1978 - whether or not a protection order should be made under s. 67 Public Trustee Act 1978 Solicitors: Hearing Date: J F Curran for the plaintiff F L Scott for the defendants D J Allard & Associates for the plaintiff Minter Ellison for the defendants 1 September 1999 -- 1 of 9 -- IN THE SUPREME COURT OF QUEENSLAND No. 2808 of 1985 Brisbane BETWEEN: PHILLIP ANTHONY WAYNE BROWN Plaintiff AND: MARY SCLAVOS Defendant AND: FIRE & ALL RISKS INSURANCE CO. LTD. Defendant by Election REASONS FOR JUDGMENT - HELMAN J. Judgment delivered 28 September 1999 1 This action arose out of an incident which occurred on 15 September 1983. The plaintiff, who was born on 14 June 1973, was badly injured when a bicycle he was riding was hit by a motor car driven by the defendant. He was taken to the Queen Elizabeth II hospital and later to the Mater Children's Hospital. His injuries were a fractured skull vault and base, a severe brain injury, a cerebrospinal fluid leak from the left ear with accumulation of air in the cranium, a perforated left eardrum and abrasions over the thoracic and lumbar spines. He was discharged from the Mater Children's Hospital on 3 October 1983. The plaintiff, by his mother as next friend, instituted the action on 23 August 1985 claiming damages for personal injury. On 22 April 1999 the action was settled. The terms of settlement are exhibit 5 to the affidavit of Mr David Allard, the plaintiffs solicitor, filed with the application before me on 17 August 1999. 2 The plaintiff applies for an order that the action be adjourned to the settlement list and an order for costs. Alternatively, the plaintiff seeks an order that the settlement of the action -- 2 of 9 -- 2 be sanctioned under s. 59 of the Public Trustee Act 1978, and that pursuant to s. 67 of that Act the Court consider whether or not a protection order should be made in respect of the plaintiff. 3 Mr Curran, on behalf of the plaintiff, submitted the evidence shows that the settlement does not require the Court's sanction and that a protection order is not called for. In the evidence are, however, reports obtained from neurologists and other experts which require consideration as to whether Mr Curran's submission is correct, because it is clear that the plaintiff, who has been an invalid pensioner since 1991, suffers from a permanent injury to his brain which has adversely affected his memory and his intellect. 4 Section 59(1), in Part 5 of the Public Trustee Act (SPECIAL FUNCTIONS OF A PUBLIC NATURE), so far as it is relevant, provides that in any cause or matter in any court C) in which damages are claimed by or on behalf of a person under a legal disability, no settlement or compromise, whether before, at, or after the trial, shall, as regards the claim of such person under a legal disability, be valid without the sanction of a court or the Public Trustee. Section 6, so far as it is relevant, provides that, in that Act, the words 'under a legal disability' mean 'not of full mental capacity'. Section 67(1), in Part 6 of the Act C) (MANAGEMENT OF ESTATES OF INCAPACITATED PERSONS), so far as it is relevant, provides that where in any action in the court by a person for damages for personal injury C) sustained by the person, it appears to the court that that person is a person in respect of whom a protection order might be made under s. 65, the court may make such a protection order. Section 65(1), so far as it is relevant, provides that protection orders may be made where the court is satisfied that a person, by reason of mental infirmity, is, either continuously or intermittently, unable, wholly or partially, to manage the person's affairs, or subject to, or liable to be subjected to, undue influence in respect of the person's estate, or any part of it, or the disposition of it. In addition to those specific provisions, there is a general provision , " ~~~~~--,~~~--,--- ~~~~---, -- 3 of 9 -- 3 giving the court the power to make a protection order if it is satisfied that a person is otherwise in a position which, in the opinion of the court, renders it necessary in the interests of the person, or of those dependent upon the person, that the person" s property should be protected. 5 The principles applicable to the question I must decide are discussed in a number of cases, but it is sufficient if I refer to two: the decision of Ambrose J. in Cocchi v. Cocchi [1989] 1 Qd. R. 266 and that of Lee J. in Hv. The Nominal Defendant, no. 966 of 1994, unreported, 19 December 1997. In the former, Ambrose J. concluded that, although s. 65 of the Act is in a different part of the Act from that in which s. 59 is to be found, it indicates the appropriate test for determining whether a person is not of full mental capacity when that is a relevant consideration under s. 59: p. 269. In H v. The Nominal Defendant Lee J. recorded his agreement with that conclusion, with which I, too, respectfully agree. 6 Dr Alison Reid, neurologist, first saw the plaintiff on 30 November 1990. She has advised him and treated him to the present. In a report dated 31 March 1995 Dr Reid included the following: CLINICAL IMPRESSION: 1 In 1983 this young man sustained a severe head injury with loss of consciouness [sic] and cerebral oedema. He has organic brain, dysfunction with blank affect, slowness, loss of smell and defects in memory and cognitive functioning. 2 Subsequent to the injury Phillip has sustained two tonic/clonic seizures and minor turns which are epileptiform in nature. These turns have responded to therapy with Tegretol and Sabril. 3 Phillip has had problems coping with stress and undoubtedly has also had episodes related to hyperventilation and panic. . 4 Phillip Brown is, in my opinion, not currently commercially employable. Reference to his work history prior to the diagnosis of epilepsy in 198911990 reveals that he worked in unskilled jobs in a -- 4 of 9 -- 4 sporadic fashion and did not earn enough to support himself. I have known Phillip for a number of years and it is apparent that he is vague and unreliable. He frequently does not keep appointments or he may tum up out of the blue when no appointment has been made. He does not have the intellect or speed to cope in the competitive work place. 5 Phillip is, in my opinion, capable of managing his daily affairs such as ensuring that his car repayments are up to date and spending his pension money. However, he would not be capable of managing a large amount of money. IN CONCLUSION: This young man has an organic frontal lobe syndrome as well as major and minor epilepsy following a severe head injury, he has lost his sense of smell and suffers from panic attacks. He is not commercially employable and, in my opinion, his permanent partial impairment is in the vicinity of 30%. 7 In a report dated 22 June 1999 Dr Reid said: ... I have not moved from my original documented opinion that Phillip Brown would appear capable of managing his daily affairs such as paying his rent, car repayments, buying clothes and spending his pension money. However, I am not convinced that on his own he would be capable of managing a large sum of money. Furthermore in all the years I have known him, Phillip has never indicated to me that he has a supportive relative who would be in a position to give him advice. It is documented fact that Phillip Brown as a child sustained a severe head injury and, as a result of this, he suffers from post-traumatic epilepsy, panic attacks, has not worked since I have known him, and is in receipt of a Disability Support Pension. It is for these reasons that I understand Phillip Brown is likely to be awarded a substantial sum of money to compensate for foreseeable loss of income and it is for e~act1y these reasons that I do not feel it would be responsible for me to state. that I feel confident that he could competently handle a large sum of money. As I observed ina previ9us report to you (13 January 1998) I believe that some of Phillip Brown's social problems, namely having fathered two children from two different women, from whom he is estranged, has risen as a result of lack of good judgement. Ifhe were in receipt of a very large sum of money Phillip Brown is likely to come under pressure from a number of sources with which I believe he would have great difficulty resisting. . Clarifying that last mentioned report Dr Reid said in a report dated 30 July 1999: ----.-.--- C) -- 5 of 9 -- 5 ... I cannot specifically identify the "sources" to which I referred in the last sentence of my report dated 22 June, 1999. I certainly had no particular person or persons in mind. I was merely referring to the well recognized scenario that people who come into a large sum of money are often put under pressure for handouts from family, friends and miscellaneous hangers-on with hard luck stories. 8 Dr Roderick Apel, psychiatrist, saw the plaintiff on 23 August 1999 to assess his capacity to manage his financial affairs. In a report to the plaintiff s solicitors Dr Apel said: I noted that Mr Brown has been giving your firm instructions for the past five years, that he commenced work in 1989 until 1991 and that he has been on a [sic] Invalid Pension since 28.02.91. He currently manages his daily financial affairs and maintains his car. I note that in 1998 he completed paying off his car loan and at the time, and made out a will. At interview, Mr Brown kept his appointment as arranged. He was neatly dressed and gave a rational and coherent account of events. He lacked spontaneous conversation and required prompting. He was emotionally flat and unresponsive. Mr Brown was orientated in time and place.' and was not labouring under any delusion likely to influence his decisions although I note he has a history of panic attacks which are acute anxiety responses, rather than an abnormality of thought. Mr Brown showed a knowledge of his daily affairs and details of his daily financial management. I note that he attends his parents shopping. Mr Brown was careful in expressing his ideas and appeared conservative and indicated that he would seek advice in matters of uncertainty, most probably from his parents. He has plans to spend approximately up to half of his compensation on capital items, such as a house, car and boat and to invest the remainder in the bank. A suggestion he should conserve his capital and live off earnings led Mr Brown to point out problems he would have in obtaining such items, and on further discussion he did not demonstrate much knowledge or understanding of financial issues or the spectrum of financial choices for investment. At interview, he did not appear impulsive in his actions or thoughts. -- 6 of 9 -- 6 . I note that Dr Alison Reid, in her report dated 22.06.99, stated she was not confident he could handle a large sum of money, but that he could manage his daily affairs. : Dr Reid referred to his lack of judgment in two relationships and considered he would have difficulty resisting demands upon him involving money. I contacted Mrs Brown, Phillip's mother, on 25.08.99. She regarded her son as careful and reliable "with a head on his shoulders" and pointed out that he managed all his own affairs at present. I further contacted Dr Alison Reid on 26.08.99. She pointed out a long association with the patient over many years including a need to arrange his appointments with his paying rent in order to remind him of his appointment. She further discussed two inappropriate relationships and associated pregnancies and related financial obligations. She stated that Mr Brown believed that ifhe was on anti-epileptics his partners would not fall pregnant, advice he apparently he [sic 1received from home. She viewed his understanding of financial matters as rudimentary. Opinion: . . It is my opinion that Mr Brown should have partial control of his own affaIrs. . . While Mr Brown presented well and obviously copes satisfactorily with management of day to day affairs, he has suffered a severe head injury and such people have a difficulty in coping with emotional pressures, which co~only affects their judgment. As such the scrutiny of the purchase of any major financial items through a third party is more likely to ensure his long term financial future. While Mr Brown's plans for several major items may be reasonable they preS,ent a significant part of his future financial security and could be approached in a graduated fashion with a possible review of his mental capacity in the future when it can be judged against his track record. 9 The plaintiff and 'his mother gave evidence by way of affidavit and orally on matters relevant to his capacity to give instructions on the settlement and to manage any money that he should ~eceive as a result· of the settlement. Their evidence was to the effect that the plaintiff could give instructions and manage his affairs with appropriate advice and assistance . from'members'ofhis family and others. In Mr Aliard's affidavit he recorded that in 1994 he ---_.__ .. -.-._-- .. () --- ----.~------- -- 7 of 9 -- 7 formed the view that the plaintiff was capable of looking after his own affairs and had capacity to instruct Mr Allard. Mr Allard said that he had acted for the plaintiff in connexion with other matters including making a will. Paragraphs 5 and 6 on page 4 of Mr Allard's affidavit and paragraph 8 on the last page are as follows: 5. Since receiving Dr Reid's abovementioned report [that of31 March 1995] I have continued to take instructions from the Plaintiff in relation to all of the abovementioned matters. Phillip has kept all of his appointments to see me and has been punctual .. He listens carefully to advice and if he does not understand that advice he will ask questions until he appears to understand. The Plaintiff s conversation after an explanation indicates that he appears to understand. For example, I explained to the Plaintiff why it was necessary to obtain the Court's approval to the settlement. Following that explanation the Plaintiff said words or words to the effect:- "They want it approved so that I can not [sic] come back and ask for more." The Plaintiff is one of my more reliable clients. The Plaintiff has been punctual for all his appointments by himself, has followed our advices and directions, has asked relevant questions and has requested copies of Court documents. 6. During the last five years I have had very regular contact with the Plaintiff. The Plaintiff has done nothing to suggest to me that he is unable to look after his own affairs or that he is unable to give instructions. 8. I have been a sole practitioner since April 1976. Personal injury claims constitute a significant part of my practice. I have no reason to believe that the Plaintiff would waste his settlement moneys and c'oIisider that he has the ability to'handlesuch moneys as responsibly as any other client. 10 Naturally I have given careful consideration to the evidence of the plaintiff, his mother and his solicitor. I place greatest reliance, however, on Dr Reid's assessment of the plaintiff. That is because as his treating neurologist she has been in the best position to observe his strengths and shortcomings objectively and expertly. Although her opinion is expressed in -- 8 of 9 -- 8 somewhat guarded terms, I conclude from it, Dr Apel's report, and my observation of the plaintiff as he gave evidence, that the plaintiff is not of full mental capacity in that he is unable, at least in part, to manage his affairs and so any settlement must be sanctioned under s. 59 to be valid. Having considered what has been put before me on the settlement including Mr Curran's memoranda of advice dated 8 March 1991 and 10 August 1999, I conclude that the settlement should be sanctioned. I also think that a protection order is called for in this case because the plaintiff is, as I assess his case, suffering not only from the disability I have just mentioned but also is liable to be subjected to undue influence in respect of his estate. (--) 11 This is a case in which any protection order would be made by the Court of its own motion under s. 67(2), in that no one has applied for a protection order. Section 67(3) (J provides, so far as it is relevant, that the Court shall, before making a protection order under s. 67 of its own motion, cause notice of its intention to consider the making of a protection order to be given personally to the plaintiff, unless the Court in any special case otherwise directs. I direct otherwise here because, as I have related, the plaintiff himself has requested ()IJ the Court to consider whether or not a protection order should be made. 12 I shall invite further submissions on the forms ofthe orders to be made. -- 9 of 9 --