PF v Public Guardian and RD
[2017] QCATA 107
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- Unreported Judgment
- PF v Public Guardian and RD[2017] QCATA 107
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PF v Public Guardian and RD[2017] QCATA 107
PF v Public Guardian and RD[2017] QCATA 107
CITATION: | PF v Public Guardian and RD [2017] QCATA 107 |
PARTIES: | PF (Applicant/Appellant) v The Public Guardian RD (Respondent) |
APPLICATION NUMBER: | APL306-15 |
MATTER TYPE: | Appeals |
HEARING DATE: | On the papers |
HEARD AT: | Brisbane |
DECISION OF: | Member Allen, Presiding Member Joachim |
DELIVERED ON: | 29 September 2017 |
DELIVERED AT: | Brisbane |
ORDERS MADE: |
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CATCHWORDS: | GUARDIANS, COMMITTEE, ADMINISTRATORS, MANAGERS AND RECEIVERS – OTHER MATTERS – where tribunal declared that adult had capacity to enter certain transactions – where transactions were between adult and her attorney in one case and relatives of the attorney in other cases – where tribunal relied upon evidence from a doctor – where solicitor provided written evidence to tribunal – where tribunal member determined not to seek further evidence – whether tribunal had all relevant information and material before it – whether tribunal correctly applied presumption of undue influence APPEAL AND NEW TRIAL – PROCEDURE – QUEENSLAND – WHEN APPEAL LIES Guardianship and Administration Act 2000 (Qld), s 130, s 146, Schedule 4 Powers of Attorney Act 1998 (Qld), s 87, Schedule 3 Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 142, s 146 GHA [2015] QCAT 262 House v R (1936) 55 CLR 499 |
APPEARANCES: |
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This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (QCAT Act).
REASONS FOR DECISION
- [2]On 2 July 2015, a learned Tribunal Member made a declaration that GHA had capacity to transfer half-ownership of her property located at West End on 15 August 2013 to her daughter RD, to make a gift of $100,000.00 to another daughter TD on 28 November 2013 and a loan of $300,000.00 to her son GHS on 13 February 2014. The learned Member gave extensive reasons for his decision following a hearing on 12 May 2015.
- [3]The hearing came about as a result of the Public Guardian investigating five allegations into the actions of RD, her attorney under an Enduring Power of Attorney dated 26 August 2011.
- [4]The Public Guardian found that one of the allegations investigated was substantiated: that the attorney acquired joint-ownership by way of a gift of a property owned by GHA.
- [5]Whilst undertaking the investigation, the Public Guardian also discovered the gift to her daughter, TD, and the loan to her son GHS. The Public Guardian expressed concerns that these transactions might constitute conflict transactions.
- [6]The learned Member found that GHA had capacity to undertake these transactions. This decision is being appealed by another daughter of GHA, PF. The appeal was filed in the Tribunal on 31 July 2015, the grounds of the appeal being:
- The Tribunal erred by finding that the adult had the requisite capacity to make the financial decisions and/or undertake the transactions the subject of the Tribunal’s decisions;
- The Tribunal erred by finding that the presumption of undue influence contained in s 87 of the Powers of Attorney Act 1998 (Qld) (POA Act) was refuted; and
- The Tribunal erred by not ensuring that it had all the relevant information and material necessary to make an informed decision about the matter.
- [7]The applicant also sought leave to appeal.
- [8]Leave to appeal is required under s 142 of the QCAT Act if the appeal is on a question of fact, or a question of mixed law and fact. If the Tribunal decides an appeal against a decision on a question of law only, the Appeal Tribunal may confirm or amend the decision, set aside the decision and substitute its own decision, or set aside the decision and return the matter to the Tribunal who made the decision for reconsideration with or without the hearing of additional evidence as directed by the Appeal Tribunal and with other directions the Appeal Tribunal considers appropriate.[1]
- [9]When deciding an appeal on a question of fact, or mixed law and fact, the appeal must be decided by way of re-hearing by the Appeal Tribunal.
- [10]In determining this matter the Appeal Tribunal will be guided by the principles outlined in House v R.[2] In that matter their Honours state:
The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance.
- [11]The Appeal Tribunal is satisfied that the grounds for appeal constitute, if demonstrated, errors of law. In these circumstances, leave to appeal does not have to be granted.
- [12]The issues considered by the learned Member was whether GHA had capacity to make a gift to RD of one half of her ownership in real estate located at West End on 15 August 2013. The Tribunal also considered whether s 87 of the POA Act has been breached. Section 87 provides that a transaction between a principal and an attorney or a relation of the attorney gives rise to a presumption in the principal’s favour that the principal was induced to enter the transaction by the attorney’s undue influence.[3]
- [13]Further, the Tribunal at first instance was also addressing the question as to whether GHA had the capacity to make the gift to another daughter of $100,000.00 which was made on 28 November 2013 and whether she had capacity to make the loan of $300,000.00 to her son GHS in February 2014.
- [14]Capacity is defined in Schedule 4 of the Guardianship and Administration Act 2000 (Qld) (GAA Act) and Schedule 3 of the POA Act. Capacity for a person for a matter means the person is capable of:
- understanding the nature and effect of decisions about the matter; and
- freely and voluntarily making decisions about the matter; and
- communicating the decisions in some way.
- [15]The appellant does not believe that her mother had capacity to make a decision to transfer half ownership of her property to RD, nor to make a gift of $100,000.00 to DT on 28 November 2013, nor make a loan of $300,000.00 to GHS on 13 February 2014.
- [16]In coming to his decision, the learned Member relied heavily on written evidence from Mr A who was GHA’s solicitor, Mr A’s submissions to the Public Guardian, and also on a geriatrician, Dr J’s report. He writes at paragraph [25] of his reasons:[4]
In coming to a decision on this aspect of the matter, the Tribunal has placed considerable weight on the solicitor’s evidence in his statutory declaration, his submission to the Public Guardian, and also on the geriatrician’s report.
- [17]During the hearing, there was considerable discussion between the learned Member and legal representatives of both the attorney and the appellant about the possibility of Dr J and Mr A being called to give oral evidence. The learned Member stood the matter down to consider that issue. He decided he had sufficient information on which to base his decision and concluded that it was not necessary to seek any further information on the basis that Dr J had provided a report of July 2013 and ‘it would seem a little curious to try and get any greater clarity from the doctor given the almost two year time delay in time’.
- [18]The transcript of the hearing reveals he also considered that because Mr A had been referred to the Legal Services Commission he did not feel there could be much value in seeking further input from him as it may place either him, the Commission or the Tribunal in a compromising position. He does not explain his reasoning.
- [19]Section 130 of the GAA Act requires the Tribunal to ensure it has all relevant information and material. Section 130(1) states:
To hear and decide a matter in a proceeding, the tribunal must ensure, as far as it considers it practicable, it has all the relevant information and material.
- [20]The learned Member had a discretion under s 130(2) of the GAA Act to request further necessary if he thought it necessary. In this case, the learned Member considered he had all the relevant information and material he required, notwithstanding the earlier discussion about requesting further information from Dr J and Mr A.
- [21]One of the grounds of appeal was that the Tribunal erred by not ensuring it had all of the relevant information and material necessary to make an informed decision about the matter. Amongst other things, the appellant argues that the Tribunal should have sought additional information and material about various matters, including:
- The possible influence of RD during the consultation with Dr J, given that he apparently does not speak the Greek language;
- The extent to which RD was involved in the decision-making process regarding the loan and the gift;
- Who signed the acknowledgement of debt document dated 5 March 2014 in which a smaller loan of just over $3,000.00 is made to GHS;
- Issues about GHA’s capacity in circumstances where she described her assets dramatically undervalued to Dr J, and
- When she described to Dr J how she wished her children to have an equal share of her estate, then subsequently arrived at relatively complex percentages for the distribution.
- [22]The Appeal Tribunal has also identified some matters about which it considers that the Tribunal at first instance should have made some further enquiries. For instance, the geriatrician, Dr J, provided a report dated 31 July 2013 for Mr A in respect of GHA’s capacity to make a will. Dr J concluded that GHA had the capacity to change her will. He did not address, and may not have been requested to address, any issues of capacity in respect of transferring one half share of her property at West End to her daughter. He noted that she wanted to leave the house to her daughter, and to divide her estate up equally between the six children. There was no discussion alluded to in Dr J’s report about transferring property prior to her death. Dr J reported that GHA thought her properties together were worth about $270,000.00 whilst Dr J was aware they were probably worth closer to $2.5 million. The Appeal Tribunal is concerned that the Tribunal at first instance relied on this report along with the material from Mr A to make a determination about capacity when Dr J’s report was a report about testamentary capacity only.
- [23]The Appeal Tribunal considers that a further consideration of GHA’s capacity is required in that the learned Member appears to have placed too much reliance on Dr J’s report that she had testamentary capacity but did not comment on her capacity to transfer property in circumstances where there was information in the report that GHA had no idea of the value of her property.
- [24]One of the bases for the learned Member’s decision is contained in paragraph [16] of this reasons, in which he states:[5]
…In his letter of 31 July 2013 to her general practitioner, the geriatrician states that he had a “long talk” with GHA about her possessions and properties and that she intended to leave the house … to RDD. Part of the discussions with GHA also dealt with her wish to change her Will. The geriatrician reported that GHA scored 21/30 (presumably on the Mini Mental State Exam, although this is not recorded in the letter). He added that she markedly underestimated the value of her property assets. The geriatrician speculated on their value, “in fact they [the properties] are probably worth closer to 2.5 million!”
- [25]The learned Member later stated:[6]
In coming to a decision on this aspect of the matter, the Tribunal has placed considerable weight on the solicitor’s evidence in his statutory declaration, his submission to the Public Guardian, and also on the geriatrician’s report. The solicitor has a history of involvement as GHA’s deceased husband and GHA’s solicitor and wisely sought a medical report concerning GHA’s capacity to execute legal and financial document prior to their preparation. It is apparent from his submissions that he warned her of the possible consequences of her actions given the nature of the relationships between the siblings. These matters were expressed in RDD’s submission to the Tribunal of 19 May 2015 as evidence that GHA had capacity to transfer half-ownership of the GHA’s property to RDD.
- [26]He further stated:[7]
The Public Guardian raised the matter of the gift to TTD and loan to GHS on pp. 17-18 of its investigation report. And while such gifts/loans made by an elderly person might alert an observer to the potential for conflict transactions, the Public Guardian does not allege that this has occurred. The report reads, “There is no medical evidence which has been provided to the Public Guardian which confirms she had the capacity to make two substantial gifts whilst still alive on 28 November 2013 and 13 February 2014. That does not mean she did not have the capacity to enter into these transactions, it just means the medical evidence provided purely speaks to GHA’s testamentary capacity around that time. The presumption of capacity has not been rebutted”. The author continues on p. 18 that the gift of $100,000 was affordable, and the loan to GHS was secured by a mortgage over his property. That debt is to be forgiven when GHA dies.
The ACAT assessment [in 23] was undertaken in February 2014. As indicated above, there were reports of short- and long-term memory problems. The Public Trustee conclusion, however, remains valid. There is no evidence to confirm a belief that GHA lacked an understanding of the nature and effects of a decision to execute the gift and the loan to her children. Given the parents’ history in supporting their children, these would be transactions that GHA could reasonably be expected to continue after her husband has passed away.
- [27]GHA’s solicitor, Mr A provided a statutory declaration to the Tribunal dated
8 October 2014, in which he outlines his various attendances on Mr and Ms GH covering the period 1 October 2008 to 15 August 2013. - [28]Mr A advised that it had been the intention of Mr and Mrs GH that RD receive the property at West End upon their death, and that wills made in 2009 reflected this. He stated that on 30 July 2013 he attended on GHA to review and update her will. She reaffirmed her and her late husband’s desire to transfer the property to RD.
- [29]The Appeal Tribunal notes that there is no evidence from his affidavit that GHA wished to transfer the property, other than by leaving it to her on their death.
- [30]Mr A formed the opinion that she was still mentally competent and had an understanding of her assets, family relationships and testamentary intentions, but recommended she obtain a medical report as to her capacity.
- [31]On 31 July 2013, her geriatrician stated that she had mental capacity according to Mr A. This however, was not the case. Dr J stated she had testamentary capacity, but nevertheless, on this advice it appears that Mr A arranged the transfers on 15 August 2013.
- [32]The Appeal Tribunal considers that further information should have been sought from Dr J regarding GHA’s capacity to execute a property transfer. The Appeal Tribunal considers this is particularly relevant given that at the time Dr J examined GHA, she underestimated the value of her assets by a factor of 10. The learned Member appears to have placed too much reliance on Dr J’s report that GHA had testamentary capacity, but Dr J did not comment on her capacity to transfer property in circumstances where GHA had no idea of the value of her property.
- [33]In relation to Mr A, the Appeal Tribunal feels that it would have been more than useful for the Tribunal at first instance to get an understanding from Mr A about the extent to which GHA understood her assets and income at the time she made the gift and the loan. Mr A makes some general comments but the Appeal Tribunal considers more specific information would have been useful and questions could have been asked of Mr A about these matters and other matters concerning the involvement of RD in these discussions.
- [34]Mr A also provided a statement dated 13 May 2015 regarding the transfer of the property at West End to the attorney.
- [35]In this document, he advises that GHA wanted to carry out her and her late husband’s wish to transfer the West End home to RD in recognition of all her efforts over several years to both her husband and herself. She also advised that she did not want any of her children disrupting her intentions concerning the West End home as set out in her will.
- [36]He stated that she initially wanted to transfer the whole property, but he counselled against this and she accepted his advice about joint tenancy. He stated that she accepted the value of the asset exceeded the economic cost of the assistance rendered, but she wished to proceed. He described her as giving a general approximate value of her assets. He does not take this any further. The Tribunal was not able to be satisfied about her accuracy in this matter.
- [37]Mr A also outlined the circumstances under which the gift was made, advising that GHA had said that she and her late husband had made gifts to some of the other children and that DT had a financial need, and that her entitlement under the will would be adjusted in view of the gift. He stated he did a rough calculation of her income and how it would be affected by the gift.
- [38]In relation to the loan to GHS, he advised that he needed the money to assist in his divorce settlement. He stated he counselled against GHA making it a gift and she accepted his advice about a loan.
- [39]The Tribunal also had access to a copy of a certificate of Mr A in which he certified as to the consultation he had with GHA on
28 November 2013 regarding the gift she wished to make to her daughter, TD of $100,000.00. He noted in the certificate that he gave advice to GHA regarding that others may challenge her capacity to make the gift, and that the gift would reduce her interest, that any bequest in her Will would not change as a result of the gift, her income would further reduce if she chose not to collect interest on the loan she was giving to her son, GHS, and he was satisfied that she has explained her wish at the time of her initial instructions and at the execution of the deed of gift which was signed on 15 December 2015. - [40]Mr A read the proposed deed to GHA and explained the contents of the deed to her in the Greek language. In his certificate he states that HGA appeared to fully understand the nature and effect of the proposed gift and then she freely and voluntarily executed the deed in his presence.
- [41]In relation to the question of undue influence, the Appeal Tribunal considers, with respect, that the learned Member has asked the wrong question. He asked ‘Is there evidence that the attorney exerted undue influence on GHA with regards to the transfer of ownership of property or gifts or loans to her children’. With respect the onus is on the attorney to show that the transactions were not affected by undue influence. Under s 87 of the POA Act, undue influence is presumed to have occurred. The correct question to be asked is what evidence is there from the attorney to rebut the presumption of undue influence? The attorney needs to demonstrate that she did not influence her mother’s decisions in respect of the transfer of a half share of her property to RD, the gift to DT and the loan to GHS.
- [42]The Appeal Tribunal sets aside the decision of the learned Member and returns it to him for reconsideration at an oral hearing of additional evidence as follows:
- From Dr J, regarding whether in the light of the adult’s estimate of her assets to him and his assessment of her generally as outlined in his report of 31 July 2013:
- GHA would have had the capacity to transfer half-ownership of her property at West End to her daughter RD on 15 August 2013;
- She would have had the capacity to execute a deed of gift for her daughter in the amount of $100,000.00 on 28 November 2013;
- She would have had the capacity to loan $300,000.00 to her son GHS on 13 February 2014;
- From Dr J, whether he canvassed the possibility of gifts of real property and loans of money with her, generally or specifically, during his consultation with her on 30 July 2013;
- From Dr J, how he was assisted in obtaining the information from the adult, given he is unable to converse in Greek;
- From RD regarding the nature and timing of discussions she held with the adult regarding the property transfer from the adult to herself, the gift to TD and the loan to GHS.
- From Mr A, evidence regarding the change of instructions from a gift in GHA’s will to transfer of property to RD, the involvement of RD in those discussions, how the percentages in the will were established, and the extent to which GHA understood her assets and income at the material times she made the gifts of property and cash to her daughters and the loan to GHS.