NSW Trustee and Guardian Appointment Procedures PDF

**HOW NSWTG IS APPOINTED** Induction Training August 2024 1. **Introduction** When appointed by a Court or Tribunal NSW Trustee and Guardian ('NSWTG') as a substitute decision maker for a person who does not have the ability to manage their own financial affairs. All decision of NSWTG relate to...

**HOW NSWTG IS APPOINTED** Induction Training August 2024 1. **Introduction** When appointed by a Court or Tribunal NSW Trustee and Guardian ('NSWTG') as a substitute decision maker for a person who does not have the ability to manage their own financial affairs. All decision of NSWTG relate to the property of the managed person and the legislation sets out that such decisions have the same effect as if the person had made that decision themselves. In acting as delegates of NSW Trustee it is important that we consider how NSWTG is appointed as the authority to act is provided by the Courts and Tribunals. Often, stakeholders do not appreciate the separation between NSWTG and the NSW Civil and Administrative Tribunal ('NCAT') but it is important to recognise and appreciate that NSWTG is an entirely separate entity. It is also important to recognise the separation between NSWTG and the Public Guardian as although we are one agency, there are different powers and functions and it is not uncommon for both the NSWTG and the Public Guardian to be appointed by the Tribunal. NSWTG is the financial manager of last resort -- the office does not actively pursue its appointment as financial manager. It is important to also recognise the breadth of the orders that are made -- it is incorrect to assume that we have all the powers and functions regarding the entire estate as NCAT, or the NSW Supreme Court, may make a limited order (i.e a customer's pension is excluded from the orders so that they may retain some independence over their estate). Persons who have NSWTG as their financial manager - 12,494 as at 30 June 2021 Persons who have private managers under the supervision of NSWTG - 5,756 as at 30 June 2021 Demand for financial management services continues to increase. Growth in customers over the last ten 10 years to 30 June 2021 is as follows: - 27% increase in total customers - 28% increase where the NSW Trustee is appointed as financial manager - 85% increase where a private manager appointed as financial manager **What is a financial manager?** A financial manager, is a person or organisation, legally appointed through a financial management order to make substitute financial and legal decisions for a person who does not have the ability to either make decisions themselves or with support. NSW Trustee and Guardian can be appointed by the Supreme Court, NCAT or the Mental Health Review Tribunal to act as financial manager for people who cannot manage their financial affairs. An application for financial management can be made by anyone with a genuine concern for the welfare of a person. In most instances the applicant is a family member, friend, social worker or health care professional. The focus for the Court or Tribunal when assessing capacity to manage affairs is whether the person is able to deal with his or her own affairs in a *reasonable, rational and orderly way, with due regard to his or her present and prospective wants and need without due risk of neglect, abuse or exploitation*. 2. **NCAT orders** Most commonly, an order for a person's estate to be managed by a financial manager comes from NCAT. These orders may follow an application by any interested party for a financial manager. Alternatively, an application may be made for the review of a Power of Attorney and the Tribunal may treat that application as an application for financial management orders. The powers of the Tribunal to make financial management orders is set out in section 25E of the *Guardianship Act 1987*. NSW Trustee and Guardian is independent statutory financial manager. NSW Trustee is the financial manager of last resort and will only be appointed in circumstances where there is no other suitable person to act. With regards to Private managers, the Court or Tribunal may appoint a relative, friend or licensed trustee company to act as Private Manager under the supervision of NSW Trustee and Guardian. In these circumstances the manager is provided with specific authorities and directions that establish the administrative parameters within which the manager must generally act. A financial management order may be made by the Tribunal in circumstances where: a\. the person is [not capable of managing those affairs], and b\. there is a [need for another person to manage those affairs] on the person\'s behalf, and c\. it is in the [person\'s best interests that the order be made]. Whether a person is 'capable of managing his or her affairs' is an objective test that takes into account the capacity of a person not merely on the day of the hearing but the reasonably foreseeable future (*McD v McD* (1983) 2 NSWLR 81). The test for determining a person's capability to manage his or her affairs was described by Justice Lindsay in *P v NSW Trustee and Guardian* \[2015\] NSWSC 579 as: In considering whether a person is "able" in this sense, consideration may be given to: a. past and present experience as a predictor of the future course of events; b. support systems available to the person; and c. the extent to which the person placed as he or she is, can be relied upon to make sound judgments about his or her welfare and interests (*CJ v AKJ* \[2015\] NSWSC 498; *P v NSW Trustee and Guardian* \[2015\] NSWSC 579). In summary, the focus for the Court or Tribunal when assessing capacity to manage affairs is whether the person is - able to deal with his or her own affairs in a reasonable, rational and orderly way - with due regard to his or her present and prospective wants and need - without due risk of neglect, abuse or exploitation. NCAT has a wider reach in many cases, because by its nature it is a Tribunal of enquiry not a Court of law (and strict evidence). Section 38 of the *Civil and Administrative Tribunal Act* 2013 specifically notes that the Tribunal is not bound by the rules of evidence and may inform itself on any matter in such manner as it thinks fit. In NCAT proceedings there is generally no affidavit evidence and no oath/affirmation to tell the truth is required. Whilst it is hoped that the truth is spoken to the Tribunal and the reasons for decision are an accurate reflection of the true state of affairs we are unable to rely on this information as sworn evidence. In addition to the finding of incapacity, NCAT must also find that there is a need for a Financial Management Order and that it is in the persons best interests that such an order be made. 3. **NSW Supreme Court orders** The Protective Jurisdiction of the NSW Supreme Court has powers under s 41 of the *NSW Trustee and Guardian Act* to appoint a suitable person as manager of the estate of a person who is incapable of managing his or her own affairs. The Supreme Court also can exercise its inherent, *parens patriae* ("parent of the nation") jurisdiction -- which is simply the historical legal doctrine whereby the monarch was obligated to care for those who could not care for themselves. The Supreme Court has the capability to make orders on its own motion, without the need for any application -- this has been seen in cases where litigation is on foot and not progressing due to an inability of a solicitor to obtain instructions or the person is self-represented and not progressing a case. ***Re WS* \[2017\] NSWSC 745** - The jurisdiction of the Court is protective in character, focusing on the capability of the person said to be incapacitated to perform particular functions, not on his or her status as a person who is, or may be, "mentally ill". The primary focus is on functionality. As in the present proceedings, mental illness, or capacity, may be an important determinant of functionality, but functionality is the key focus 4. **Mental Health Review Tribunal orders** The Mental Health Review Tribunal has the power to order the estate of a person be subject to management under the NSW Trustee and guardian Act if it is satisfied that the person is not capable of managing his or her own affairs (s 45 NSW Trustee and Guardian Act) 5. **Revocation of orders** NCAT orders can only be revoked by NCAT -- Fact sheet is available to provide clients with the opportunity to seek for the orders to be revoked. NSW Supreme Court can revoke Court orders pursuant to section 86 of the NSW Trustee and Guardian Act. Often requires the customer to retain a solicitor and always requires supporting evidence. 6. **Implications of NSW Trustee as financial manager** Once appointed, NSW Trustee and Guardian have all the powers and functions of the managed person in relation to their property and affairs. The *NSW Trustee and Guardian Act 2009* provides this office with all functions necessary and incidental to its management and care. Some key sections of the *NSW Trustee and Guardian* Act which will be directly relevant to your day to day conduct include: a. welfare and interest of the person should be given paramount consideration b. freedom of decision and freedom of action should be restricted as little as possible c. persons should be encouraged, as far as possible, to live a normal life in the community d. views of persons should be taken into consideration e. importance of preserving family relationships and cultural and linguistic relationships should be recognised f. persons should be encourages, as far as possible, to be self-reliant in matters relating to their personal, domestic and financial affairs g. persons should be protected from neglect, abuse and exploitation a. payment of the debts and engagements of the person and the repayment of expenses chargeable to the estate b. in the event of death, funeral expenses c. maintenance of the spouse of the person or any child, parent or other person dependant upon the person d. payment of all proper costs incurred in or about the care, protection, recovery, sale, mortgage, leasing, disposal and management of the estate of the person e. preservation and improvement of the estate f. taking up of rights to issues of new shares, or options for new shares g. maintenance, clothing, medicine and care 7. **Financial managers fiduciary duties** Recently in a case brought by NSW Trustee and Guardian (*Dowdy v Clemson*) the Court held that the office of a financial manager is a fiduciary one. A financial manager has a foundational duty to act within the scope of his, her or its authority as a financial manager, in the interests and for the benefit of the managed person, and in good faith. From that duty flow: \(a) precepts about avoidance of conflicts of interest and duty; and \(b) the duty not to make an unauthorised profit from the office of a fiduciary. A financial manager who deals with property of the managed person without authority does so at his, her or its own risk. A financial manager has a liability to account for his, her or its dealings with a managed person's estate. A financial manager is bound to act in the interests, and for the benefit, of the person under management.