Administrative Decisions Tribunal New South Wales

• Medium Neutral Citation: AMC and ALQ v NSW Trustee and Guardian [2012] NSWADT 217
• Hearing dates: 13 September 2012
• Decision date: 13 September 2012
• Before: Judge K P O'Connor, President

Decision

Application for stay not granted

• Catchwords: PROTECTED ESTATE - Sale by Auction of Property - Stay application - Not granted
• Category: Principal judgment
• Parties: AMC (First Applicant); ALQ (Second Applicant); NSW Trustee and Guardian (Respondent)
• Representation: Counsel; S Brennan (First and Second Applicants); D Mendelssohn (First and Second Applicants); R Stormont (Respondent)
• File Number(s): 123257

REASONS FOR DECISION

1 The Tribunal gave oral reasons in this matter at the close of hearing. Written reasons have been requested by the respondent, the NSW Trustee.

2 Background: The applicants are 'AMC', a woman in her early 80s, and her son, 'ALQ'. (The applicants' identities are anonymised in accordance with the practice of this Tribunal in its protective jurisdictions; and are given pseudonyms.) AMC is the subject of an order made by the Guardianship Tribunal appointing the NSW Trustee as financial manager of her estate.

3 The applicants have applied for review of the NSW Trustee's decision to sell AMC's principal asset, her home of more than 60 years, to enable a fund to be available for her current and future care needs. She has mild dementia. She and her son are not opposed outright to a sale. She has in fact already left the home. She now lives in a villa unit close to friends and relatives in another part of town. The sale of the home would enable discharge of the mortgage loan that supported that purchase.

4 Nonetheless the applicants' have applied for the sale by auction of the home to be delayed. They believe that the property has not been adequately marketed, both in terms of its presentation and in terms of promoting the redevelopment possibilities of the site. It is a large site by inner suburban standards, with access to a street at the front and the back, and garaging for two cars. The dwelling is turn-of-the-20th century style, with period features in the front part, along with additions to the rear in later styles.

5 In support of the application, the son presented evidence of the way the house had been presented on open days. He gave an account of his visits to the property and presented to the Tribunal photographs showing a state of disarray in some rooms, for example unmade beds, unwashed items in the kitchen sink and the like. It emerged at hearing that the mother had re-located some time ago. The house had been occupied in the weeks prior to the inspection period by her daughter and her daughter's teenage son.

6 The son also suggested that the property could be marketed as having redevelopment potential, and that would be likely to attract a higher price than that apparently being sought at the moment. That would be to the advantage of his mother. He also made allegations as to what he saw as collusive activity involving another member of the family in relation to the sale. She did not have an opportunity to respond to these suggestions.

7 As in many cases involving protected persons, there is division in the family around a number of matters relating to the care and other needs of the protected person (recorded in this instance in the reasons for decision of the Guardianship Tribunal).

8 AMC was present at the hearing but did not give evidence.

9 The Tribunal arranged for telephone evidence to be given at short notice by a responsible officer at the NSW Trustee, Mr Caldwell, property manager, and the agent handling the sale, Mr Movsessian (Century 21, Randwick).

10 Mr Movsessian confirmed that the son's assertions regarding the state of some the rooms on the recent open days was accurate. He disputed the son's contention that it mattered how a property of this kind was presented. He said that the interested market looked past these things, and focussed on the essentials of the property and such matters as the possible cost of renovation. He rejected the practicality of marketing the property as one with subdivisional and redevelopment potential. He referred to the number of parties that had inspected the property, the number of contracts that had been issued, and the number of building inspections that had been obtained by interested parties.

11 Mr Caldwell stated that no special instructions were given to agents engaged to handle clients' properties as to how they were presented for sale, and the office did no monitoring in that regard.

12 Another issue raised by the son was the question of setting and revelation to the protected person and the family of the reserve. Mr Caldwell explained that the office practice was to settle the reserve close to the date of the auction, and to provide it in a sealed envelope to the auctioneer. The office's experience was that it was desirable to protect closely information in relation to the reserve amount.

13 The NSW Trustee presented all relevant material in relation to its decision to sell, and to proceed by way of auction, including property appraisals and agents' estimates.

14 An edited text of the oral reasons delivered on the day follows.

15 HIS HONOUR: The Tribunal has before it an application to stay the NSW Trustee's decision to auction the first applicant's property on Saturday, which is only two days away. Today is Thursday 13 September, the auction date is Saturday 15 September.

16 As I understand it, the property went to market on or around 21 August. There was a prior period (around April/May) when it was on the market. Mr Movsessian (the agent) has given evidence that it was withdrawn from the market on that occasion on instructions from the NSW Trustee following the NSW Trustee's appointment as financial manager of AMC's financial affairs.

17 The other aspect of the background is that in the meantime, AMC has found a new residence in the Ryde area. There is a mortgage that facilitated that purchase which will be discharged on sale of the family home.

18 There has been a history of family disputation and that is well set out in the reasons of the Guardianship Tribunal which are quite extensive and which I have read. There has been a difference between the children over the degree of inability of their mother to manage her affairs. The Guardianship Tribunal dealt with those differences at length.

19 There have been questions raised here again today about the quality of Dr Chalkley's assessment of their mother's capacity to manage her financial affairs. Similar questions were raised before the Guardianship Tribunal and the Guardianship Tribunal took a view on that matter.

20 The position therefore is that the NSW Trustee has outright responsibility for the financial management of AMC's financial affairs.

21 The evidence of the poor state of the presentation of the property at open days has been available now for some time. I have noticed in the paperwork that Mr Mendelssohn (solicitor for the applicants) commenced to take action formally on 7 September 2012 (see letter of complaint to the NSW Trustee). It may be that he engaged in representations of a more informal character predating that date.

22 I think it is a matter of concern that the evidence of these issues was raised by the son and Mr Mendelssohn with the NSW Trustee and met, it would seem, with no action. My firm opinion is that the office should proceed on a principle of respect for the protected person's likely views on the matter, in relation to the way in which their homes are presented to market. I do not understand my view to be that of the office. As I have understood it from Mr Caldwell (Manager, NSW Trustee), the office is relatively inactive in that matter and leaves things entirely to the discretion of the agent.

23 It is clear from the evidence today that Mr Movsessian has made his own call on this issue. He appears not to be of a view that this matter is of importance in terms of the market, and that closes the issue in his mind.

24 I think this is something that would matter to the protected person and their family; and it did seem to matter to the mother and her son in this case. It is a matter of regret that we have had this sort of insouciance in relation to this issue.

25 I accept having said that, that there are houses often that the NSW Trustee is called on to manage and put to market that are in shocking states of disrepair. I am not talking about houses of that kind. I am talking about houses that are within the ordinary framework of home management.

26 Nevertheless it seems to me that the factors of prejudice that exist today are such that it would be inappropriate of me to make a restraining order at this late stage. I accept what Mr Movsessian says that there had been a significant level of buyer interest, evidenced by various contracts going out.

27 I have noted what has been said about the possible involvement of another family member in the decision to sell. The family conflicts that form part of the background to this case are mapped to some extent in the Guardianship Tribunal decision.

28 It may be that the property has got development potential in the way that has been said by the son. I think it is noteworthy that in the real estate appraisals and the independent valuation that those factors are not focussed on at all.

29 It seems to me that they are not factors that were in play at the time of the original marketing or at the time of the present marketing. As we are all well aware, there are a lot of administrative complexities that surround the making of development applications and the creation of subdivisions. I do not doubt that it may well be that there could be interested buyers who are interested beyond the range of their own immediate family needs in the property. But it seems to me that goes with the market, especially in the inner suburbs.

30 So as the matter stands today I accept the concerns that have been expressed by the son and his mother.

31 I think it would have been more respectful had the property been presented in a better way. I think though it is now too late and too close to the auction date to interfere so radically with the decision that has been taken. Some reassurance can at least be obtained from the fact that there is the level of activity and interest in the property that has been indicated.

32 For those various reasons I am not prepared to intervene.

33 I do not for a moment think it is an entirely happy state of affairs that we have experienced today.

34 We hear cases here frequently where there is criticism of the unavailability of estate officers to people with grievances. I realise that your officers, Mr Caldwell, are under enormous pressure and often are faced with difficulty in dealing with representations. We also hear complaints about phones not being answered. The Tribunal had that experience today when it was unable to reach you at the appointed time on the number you had given; it constantly went to message.

35 So I just hope you can take some of those concerns back into the office administration and do what you can to improve levels of communication. I accept that you are often dealing with situations where there are differences of views in families.

36 So with those observations the decision today is not to grant the interim order.

37 We can go on and I suppose hear an application for review in relation to the principal matter, but it is not clear what purpose that would serve. However I will not strike it out, I will just simply not grant the application for a stay and we will put the underlying application for review back in the list to be considered on a future directions date.

Decision last updated: 24 October 2012