Guide to Financial Management Options for Adults with a by naw15914

VIEWS: 15 PAGES: 14

									Guide to Financial Management Options
for Adults with a Legal Incapacity
NSW




                               This guide outlines the processes involved in appointing a
                               financial manager to manage the damages of adults with
                               a legal incapacity and summarises the relevant law.




This document is a guide and is not legal advice. It is intended to provide information only and should not be relied upon as if it were legal advice. It has
been prepared for general application and does not taken into account individual circumstances. You should therefore make your own assessment about
the relevance of the information to your clients. ipac securities limited ABN 30 008 587 595 AFSL No. 234656 is not a firm of lawyers and does not
provide legal advice. This document is current as at 1 October 2005 and subject to change at any time.
                                     Guide to Financial Management Options
                                     for Adults with a Legal Incapacity
                                     NSW




Contents

                                                                             Page


     Damages and financial managers                                           3

     Lawyers making applications                                              5

     Who can be a financial manager?                                          6

     Does the court have a preference?                                        8

     The financial plan                                                       9

     Changing managers                                                       10

     Security                                                                11

     When should a financial manager be appointed?                           11

     Tribunal or Supreme Court?                                              12

     Application to Supreme Court for appointment of a manager               12

     Precedent / application forms                                           14




                                                                                    2
                                             Guide to Financial Management Options
                                             for Adults with a Legal Incapacity
                                             NSW




Damages and financial managers

     A plaintiff’s damages may come under financial management by the reason of the following
     processes:
     •     By operation of the Protected Estates Act 1983;
     •     By operation of the Guardianship Act 1987;
     •     By operation of s77 Civil Procedure Act 2005;
     •     “Automatically” by reason of the plaintiff having a tutor;
     •     Prior to the Civil Procedure Act 2005 (“CPA”), damages could also come under financial
           management by operation of the Damages (Infants and Persons of Unsound Mind) Act 1929.
           This Act was repealed by the CPA.

     There will usually be some overlap between some (or all) of the above, in that a particular client
     could be “captured” by more than one of the above processes.

     Protected Estates Act 1983 (“PEA”)

     S 13(1) PEA provides:
          Where the Court [being the Supreme Court Equity Division] is satisfied that a person is
          incapable of managing his or her affairs, it may make a declaration to that effect and order
          that the estate of the person be subject to management under this Act.




       Meaning of “incapable of managing own affairs”

       The test as to whether a person has the capacity to manage his or her own affairs is set out in
       PY v RJS1:

       “…a person is not shown to be incapable of managing his or her own affairs unless, at the
       least, it appears:

       (a)     (a) that he or she appears incapable of dealing, in a reasonably competent fashion,
               with the ordinary routine affairs of man; and

       (b)     that, by reason of that lack of competence there is shown to be a real risk that either:
               he or she may be disadvantaged in the conduct of such affairs; or that such moneys
               or property which he or she may possess may be dissipated or lost…it is not
               sufficient, in my view, merely to demonstrate that the person lacks the high level of
               ability needed to deal with complicated transactions or that he or she does not deal
               with even simple or routine transactions in the most efficient manner.”

       The above test has been applied in many applications under the PEA. See Re GHI2 for a
       summary of those cases.




                                                                                                          3
                                                   Guide to Financial Management Options
                                                   for Adults with a Legal Incapacity
                                                   NSW




Guardianship Act 1987 (“GA”)

The GA empowers the Guardianship Tribunal to make a financial management order. A financial
management order of the Tribunal is simply an order that the person’s estate come under the
PEA (25E(1).)

Section 25G sets out the grounds for making financial management order.

The Tribunal may make a financial management order in respect of a person only if the Tribunal
has considered the person’s capability to manage his or her own affairs and is satisfied that:
(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.

A financial management order can be in addition to a guardianship order or on its own (s25F).

The Tribunal does not have jurisdiction to make a financial management order in respect
of a person:
•     if the question of the person’s capability to manage his or her own affairs is before the
      Supreme Court (although the Tribunal can make an interim financial order (s 25K(1));
•     where an order made under the PEA is in force in respect of any part of the
      person’s estate (s 25K(2)).

Civil Procedure Act 2005

S77 provides
(1) This section applies to money recovered in any proceedings on behalf of any of the following
     persons:
     (a)     a person under legal incapacity,
     (b)     a person who, during the course of the proceedings, becomes a person under legal
             incapacity,
     (c)     a person whom the court has found, under section 76 (1) (c), to be incapable of
             managing his or her own affairs, pursuant to a compromise, settlement, judgment or
             order in any proceedings.
(2) All money recovered on behalf of a person referred to in subsection (1) is to be paid into court.
(3) Despite subsection (2), the court may order that the whole or any part of such money not be
     paid into court but be paid instead:
     (a)     if the person is a minor, to the Public Trustee, or
     (b)     if the person is a protected person, to the manager of the protected person’s estate, or
     (c)     in any other case, to such person as the court may direct.
(4) Money paid into court under subsection (2) is to be paid:
     (a)     if the person is a minor, to the Public Trustee*, or
     (b)     if the person is a protected person, to the manager of the protected person’s estate, or
     (c)     in any other case, to such person as the court may direct.


*Note: there is some concern that s 77(4)(a) means that damages for a minor must be paid to the Public Trustee and cannot
be administered via a private trustee or other manager. It is probable that this was an inadvertent effect of the legislation and
submissions have been made to the relevant minister to amend the legislation. In the interim an application should be made
to have the minor declared a protected person, so that s 4(b) applies.



                                                                                                                                    4
                                              Guide to Financial Management Options
                                              for Adults with a Legal Incapacity
                                              NSW




     S 3 provides that:
     “person under legal incapacity” means any person who is under a legal incapacity in relation to the
     conduct of legal proceedings (other than an incapacity arising under section 4 of the Felons (Civil
     Proceedings) Act 1981 ) and, in particular, includes:
     (a) a child under the age of 18 years, and
     (b) a temporary patient, continued treatment patient or forensic patient within the meaning of the
           Mental Health Act 1990 , and
     (c) a person under guardianship within the meaning of the Guardianship Act 1987 , and
     (d) a protected person within the meaning of the Protected Estates Act 1983 , and
     (e) an incommunicate person, being a person who has such a physical or mental disability that
           he or she is unable to receive communications, or express his or her will, with respect to his
           or her property or affairs.

     Tutor on the record

     The practice of the court is that once a tutor is on the record damages will not be paid out to the
     plaintiff. In Lim v Nominal Defendant3 Hodgson J said the following:
            ”When there is a judgment in favour of a person with a tutor, whether this be as a result of a
            settlement or as a result of a contested hearing, the practice is not to have the judgment
            money paid out to the plaintiff…this is not because of the application of the Damages (Infants
            and Persons of Unsound Mind) Act, and it is not the result of anything in the Protected
            Estates Act. Rather, it is because the court would not normally consider it to be in the
            interests of a disabled person, and in particular a person who is incapable of managing his or
            her affairs, that a substantial sum of money be paid to that person. It is not appropriate either
            for the judgment sum to be paid to the tutor, who has only been appointed for the purpose of
            conducting the proceedings. Very often, a manager is appointed under the Protected Estates
            Act, and the judgment money is then paid to that manager. In the absence of such
            appointment, the judgment money may be paid to the Public Trustee or to the Protective
            Commissioner.”




Lawyers making applications
     An application that the plaintiff lacks capacity should be made by the plaintiff’s lawyer only
     as a last resort.

     In McD v McD4, Powell J expressed the view that it is undesirable for a solicitor to make an
     application to have their own client declared incapable because to do so puts the solicitor in an
     adversary position in relation to the client, particularly where the client wishes to oppose the
     application.

     In P v R5 the court recognised that such an application involves the solicitor in a conflict between
     the duty to do what the solicitor considers best for the client and the duty to act in accordance with
     the client’s instructions; and also because of a possible conflict between the solicitor’s duty to the
     client and the solicitor’s interest in continuing to act in the proceedings in question and to receive
     fees for this.



                                                                                                                5
                                             Guide to Financial Management Options
                                             for Adults with a Legal Incapacity
                                             NSW




            “The central message here is that, because of the duties owed by solicitors to their clients,
            a solicitor should not initiate an application [that their client lacks capacity] …at least if
            there is any reasonable alternative.”




Who can be a financial manager?
     Financial managers may be:

     A person, usually a family member, such as the spouse or parent of the incapacitated person.

     Advantages                                          Disadvantages

     •   Cost free.                                      •    Inexperience may result in failure to
                                                              maximise the damages sum.

     •   Flexible and easy – no need to ask anyone for   •    Conflict of interest – will the money be
         money and transactions can be effected when          spent on the plaintiff or go into the family
         convenient without involving a third party.          coffers?

     •   Assists to normalise the family.                •    Potential for misuse of funds.

     •   The love and affection component.               •    Administration may add to the load on an
                                                              already burdened family.

     •   Familiarity with wishes of incapacitated        •    Potential for family conflict.
         person.

     A person plus a professional. In this scenario a person, again usually a family member, manages
     the day-to-day finances together with a suitably qualified and experienced professional who provides
     advice and manages the investment. The professional adviser may be engaged by the financial
     manager or may be formally appointed a joint financial manager. The advantage in the formal
     appointment is that the protected person is guaranteed ongoing professional advice, rather than
     advice being obtained at the “whim” of the family member.


     Advantages                                          Disadvantages

     •   Professional advice increases the likelihood    •    Cost of financial advice - Note however that
         of maximising the damages sum - always               this will usually have been allowed for in
         important given the deleterious effect of the        the damages and will be usually offset by
         discount rate on damages, and particularly           the increased returns which result from
         so when the plaintiff has significant ongoing        professional advice.
         expenses, a lengthy preclusion period or
         where the claim has been compromised,
         meaning there are insufficient funds to
         meet future needs.

     •   Cost effective – there will be no charge for    •    Day-to-day administration may add to the
         the day-to-day financial administration              load on an already burdened family.
         carried out by the family member.
                                                                                                             6
                                         Guide to Financial Management Options
                                         for Adults with a Legal Incapacity
                                         NSW




A person plus a professional (cont.)

Advantages                                            Disadvantages

•   Finances remain flexible and easy – unlike
    having the OPC or a trustee company as
    manager transactions can be effected when
    convenient without involving a third party –
    assisting to normalise the family and to
    keep involved those who care for and know
    the injured person.

•   The potential for conflicts of interest, family
    conflict and mis-use of funds is significantly
    reduced by the appointment of a
    professional adviser as a joint manager or,
    even if not appointed joint manager, by the
    knowledge that an experienced professional
    with a duty to the incapacitated person will
    be involved.


A private trustee company.

Advantages                                            Disadvantages

•   Safe – minimal risk to damages sum owing          •   Costly – fees are charged for the day-to-day
    to fiduciary and statutory duties of trustee.         administration, investment advice and for
                                                          the trustee services. Note however that
                                                          these fees will usually have been allowed
                                                          for in the damages and will be usually
                                                          offset by the increased returns which result
                                                          from professional advice.

•   Takes the load off the family.                    •   Not as flexible or easy as carrying out
    May reduce family conflict.                           transactions without involving a third party.

•   Experienced in managing estates and in            •   “De-normalises” the family by involving a
    investment.                                           third party.


The OPC. The OPC is a statutory agency that provides financial management services for those who
are unable to manage their own financial affairs.

The OPC also supervises private managers by providing authorisation and direction support.


Advantages                                            Disadvantages

•   Similar to trustee companies, although            •   Similar to trustee companies.
    technically not a trustee and therefore does
    not owe the same duties to the plaintiff.

                                                                                                          7
                                               Guide to Financial Management Options
                                               for Adults with a Legal Incapacity
                                               NSW




Does the court have a preference?
      For many years the court appeared reluctant to appoint a manager other than the OPC.

      Since the 1993 decision of Holt v Protective Commissioner6 (“Holt”) the court now leans toward the
      appointment of a family member. The overriding issue however is what is in the best interests of the
      plaintiff.

      Cases indicate the following considerations to be important:

      •     Expert advice
            The court will want evidence that the family member has access to AND will rely upon
            financial advice particularly where there is a considerable sum is involved7 (this is dealt with
            in more detail below).
                “…[I]f a responsible member of the incapable person’s family, with the consent of other
                members of the family and particularly when joined with a person with financial
                expertise, seeks to be the manager, such an order will, at least at present, usually be
                made almost as of course.”8

      •     Character and capability
            The court will want evidence that the family member is of good character, has an ability
            generally to manage the finances and an understanding of what is required in the role9.

      •     Consent of family members
            It is fair to say that where there is a dispute between family members as to who should be
            appointed manager or where there is likely to be dispute as to use of the funds the Court will
            lean toward the OPC10.

      •     Conflicts of interest
            The Court will want to be sure that conflicts of interest are dealt with appropriately. In Holt the
            Court recognised that:
               “Ordinarily a person who would face a conflict of interest and duty would not be
               appointed a manager of the protected persons estate. However in some family situations
               inter-related property interests may present some conflicts. Sometimes they will be more
               apparent than real. They do not necessarily present an absolute bar to appointment as a
               manager, for otherwise this would exclude from consideration a range of family members
               in every other way appropriate.”

            In Re L the proposed manager was the father and would be living in his house with the
            plaintiff and purchased from him with a portion of the plaintiff’s damages.
                “It is most acceptable that a parent who is the manager of a person who cannot manage
                her affairs live in the same house rent free, but care needs to be taken that such person is
                not receiving a real benefit at the expense of the incapable person. The Court would need
                to know what is happening about the purchase of the house, what is the beneficial interest
                of the [parent/manager] in the house if any, what [the parent/manager’s] rights are going
                to be, and to see that there are going to be no substantial conflicts of interest…”




                                                                                                                  8
                                                Guide to Financial Management Options
                                                for Adults with a Legal Incapacity
                                                NSW




The Financial Plan
      Where the manager is other than the OPC it is common practice to put a financial plan to the court,
      usually by way of annexure to the affidavit of the plaintiff/applicant or proposed manager. A financial
      plan is not specifically required however it serves a number of purposes.

      Firstly it demonstrates to the court that the proposed manager has directed his or her mind to the
      management of the damages sum.

      Secondly it demonstrates to the court that the proposed manager recognises the need for
      professional advice.

      Thirdly, once the order appointing the manager has been made, Pt 76 r 17 SC Rules requires that
      within 14 days the manager must provide a summary of the scheme proposed for administration
      and management of the estate of the protected person. The financial plan can provide this
      information.

      The downside of the practice of putting the financial plan to the court is that the court has, on
      occasions, made it clear that it is not
            “…particularly impressed…at receiving 20 or 30 pages from a financial planner downloaded
            from a computer setting out all sorts of facts and figures and pie charts, but not providing
            any real information as to what is the bottom line for the client.”11

      Extracting the information that is relevant to the court and including it in the affidavit is a useful
      way of ensuring the court has the information it requires in a concise and comprehensible form.

      The following considerations should be addressed:

      •     The plan must address the incapacitated person’s needs
            The court wants a plan that relates to the financial and other needs of the injured person and
            that recognises these needs differ from those of other investors.

            As an example, complex tax minimisation schemes may not be appropriate for damages sums
            due to their high costs. Further, the purpose of the damages is compensation of the injured
            person – a court will want to see the monies appropriately expended on the injured person,
            not on boosting the family coffers. The court will be particularly concerned with seeing the
            plaintiff through the preclusion period. If for some reason the plan does not do this there will
            need to be explanation as to why and perhaps other plans obtained.

      •     What is the bottom line for the injured person?
            What are the injured person’s living expenses? What income will be generated from
            investment of the damages sums? Is there sufficient income to meet the expenses? What are
            the fees – what are they for and what they will amount to each year?

      •     Accuracy
            The court wants the figures in the plan to be correct e.g. the investment sum to which the
            plan relates should be accurate, having taken into account all the amounts to be paid out or
            immediate expenses to be incurred.


                                                                                                                9
                                             Guide to Financial Management Options
                                             for Adults with a Legal Incapacity
                                             NSW




Changing Managers
     Different considerations apply to a change of manager as compared to the appointment. The primary
     concern of the Court remains the best interests of the person whose estate is subject to management13.

     Reasons held sufficient to justify a change include:
     •    breach of duty by the current manager;
     •    where the manager is incompetent or has acted, in a relevant way improperly or unlawfully;
     •    a breakdown in the relationship between the protected person’s primary carer and the trustee
          such that it was in the interests of the protected person to remove the trustee as the
          advantage in the removal outweighs the disadvantage of the appointment of a new manager.

     Note however that not all breakdowns in relationship between the carer and the manager will result
     in the appointment of a new manager14. The primary issue is the interests of the protected person
     so if their mental or physical state is such that they are unaware of the tension resulting from the
     breakdown in the relationship a change is less likely to be ordered. If, however, as in MB v
     Protective Commissioner15 the breakdown in the relationship has adverse consequences for the
     protected person a change is more likely. In that case the judge gave much weight to the fact that
     the mother’s peace of mind was very important to her son’s (the protected person) welfare: she
     having devoted herself to his wellbeing. Further in that case there was a deleterious financial impact
     on the estate because the mother was required to engage solicitors in her dealings with the OPC.

     If the current manager’s investment strategy is unlikely to see the protected person through the
     preclusion period and the new manager can demonstrate a sound plan to achieve such an outcome
     then the Court will give significant weight to this16.

     The “mere” fact that the plan of the proposed new manager has a significantly better projected
     financial outcome does not appear to be sufficient of itself to justify a change, the better outcome
     being dismissed as too unreliable over the long term given the number of variables involved.

     In deciding whether a change is in the best interests of the protected person the Court will consider
     the following:
     •      that a change of manager involves disruption which may be disadvantageous to the plaintiff,
            not just financially but emotionally;
     •      whether the issues can be dealt with otherwise e.g. by the Court giving directions;
     •      the costs of the change, in terms of outgoing and ingoing fees;
     •      the experience of the new manager in dealing with protected estates;
     •      a comparison of the financial plans, although see comments above in terms of there being
            little weight given to better return, without more.




                         It is very difficult to change managers.
                     The key message is “get it right first time”.

                                                                                                              10
                                               Guide to Financial Management Options
                                               for Adults with a Legal Incapacity
                                               NSW




Security
      S 31 PEA empowers the Court to obtain security from private managers, which security is lodged
      with the OPC.

      Pt 76 r 17(5) SC Rules provides that where the manager is required to give security the OPC shall
      fix the amount and nature of such security.

      The cost of furnishing the required security is usually allowed as a cost of administration.

      Security has been traditionally given in the form of a bond from an insurance company, however
      more recently insurance companies are vacating this market.

      In Re McL17 the Court recognised that with the phasing out of insurance bonds, it is more likely than
      not that the security would have to change from time to time as the content of the estate changed.
            “The Court endeavours as much as possible not to freeze the money of the incapable person,
            but to allow it to earn income at the best possible rate. Accordingly, satisfactory security is
            often an undertaking by a solicitor that that solicitor will hold the deeds of the incapable
            person’s property in the solicitor’s strong room and not permit any dealing with such deeds
            without the consent of the OPC…If the incapable person has a capital sum invested, then
            the security may well be a similar undertaking in respect of the title documents to that
            capital sum… If there cannot be such an arrangement with the incapable person’s title
            deeds to land or capital and a bond from a bank or insurance company is impracticable
            also, then there may have to be a deposit of cash. If cash is deposited with the Protective
            Commissioner it will need to go into his common fund. The rates of income from the
            common fund may not be as great as could be obtained on the open market in a relatively
            secure investment. It may, accordingly, be advisable for managers to obtain some quotations
            before lodging a cash sum. In short, the security to be provided will need to be tailor-made
            to each case. It must give the incapable person security against the manager, but at the
            same time not freeze assets unnecessarily.“

      In appropriate cases the manager may be required to enter into a deed (Pt 75 r 17(6)).

      In cases where the funds are invested in a managed fund or similar the security may be that the
      fund manger not release funds other than per the financial plan (which has been approved by the
      OPC) without reverting to the OPC.




When should a financial manager be appointed?
      There is no hard and fast rule.

      In certain cases it may be useful (or necessary) to have the financial manager appointed prior to
      resolution of the personal injury proceedings by application to the Guardianship Tribunal or Supreme
      Court. Tactically this could be advantageous if you foresee a dispute as to the plaintiff’s need for a
      manager from the defendant. On the other hand appointment of a private person as manager may
      impact on the amount of damages that can be claimed for the cost of funds management.

                                                                                                               11
                                               Guide to Financial Management Options
                                               for Adults with a Legal Incapacity
                                               NSW




      If a private manager has been appointed prior to resolution it would be prudent to address the
      ability of that manager to manage the damages sum in the material that goes to the court. This is
      particularly important when the manager is unskilled and, for example, the estate previously
      comprised only Centrelink benefits but now consists of a large lump sum.




Tribunal or Supreme Court?
      Again, there is no hard and fast rule.

      Whether the application for appointment of a manager should be made to the Tribunal or to the
      Supreme Court will depend for the most part on the timing of the appointment. If there is some
      need to appoint a manager prior to resolution of the personal injuries claim then application to the
      Tribunal may be a cost-effective option. The Tribunal’s processes are less formal and anecdotally the
      Tribunal takes a more paternalistic approach, which may be relevant in more “borderline” cases.

      The majority of lawyers however feel more “at home” in the Supreme Court.




Application to Supreme Court for Appointment of a Manager
      The application is made by way of summons (Part 76 Rule 5 SC Rules). To date there have been
      no changes to the relevant forms by reason of the UCP Rules.

      The applicant is referred to as the plaintiff and the person in respect of whom the application is
      made is referred to as the defendant.

      In the heading the word “Protective” is added under the words “Equity Division” and the summons
      is headed “In the matter of [defendant] and the Protected Estates Act 1983, Section 13” (Pt 76 r 3).

      Typically the orders sought will be as follows:
      1.    A declaration that [defendant] is incapable of managing his/her affairs;
      2.    An order that the estate of the defendant be subject to management under the subject Act;
      3.    [If a manager other than the OPC is proposed] An order that subject to the giving of security
            to the satisfaction of the Court18 [proposed manager] be appointed manager of the estate of
            the defendant to act in relation thereto under the order and direction of the Court.
      OR
            [If the OPC is the proposed manager] An order that the management of the estate of the
            defendant be committed to the Protective Commissioner.
      4.    An order that the costs of the plaintiff of and incident to these proceedings be agreed or
            assessed and the amount allowed by agreement or on assessment be paid to the parties
            entitled thereto out of the estate of the defendant.

      Part 76 rule 11 sets out the affidavit material required by the Court.



                                                                                                              12
                                           Guide to Financial Management Options
                                           for Adults with a Legal Incapacity
                                           NSW




The evidence shall include:
(a) an affidavit or affidavits setting out:
     (i)   the conduct and conversation or conversations claimed to establish that the defendant is
           incapable of managing his or her affairs,
     (ii) the nature and amount of the property of the defendant,
     (iii) the kindred and nearest relatives, so far as the same are known, of the defendant and
           the attitude of each of them to the application,
     (iv) the name of and reason for selecting the proposed manager,
(b) the affidavits of at least two medical practitioners or persons qualified to give
     an expert opinion upon the defendant’s condition, each of whom shall set out:
     (i)   his formal qualifications, the extent of his experience in practice and his special
           qualifications in regard to questions relating to the defendant’s condition,
     (ii) his diagnosis of the defendant’s condition explained in his own words and set out in his
           own handwriting,
     (iii) that in his opinion the defendant is incapable of managing his affairs,
     (iv) the reasons for that opinion or the tests conducted upon which that opinion is based,
           set out in his own words and handwriting,
(c) except where the proposed manager is the Commissioner, the Public Trustee or a trustee
     company, the affidavits in the prescribed form of at least two persons of the fitness of a
     proposed manager*
     *Note: In the event that the manager is a private person who has obtained financial advice
     one of the affidavits as to the fitness of the manager could be from the advisor who should
     have explored extensively the manager’s ability and bona fides as part of the process of
     providing advice.
(d) except where the proposed manager is the Commissioner, a consent in the prescribed form,
     executed by the proposed manager (except where he is also the plaintiff) and an affidavit in
     the prescribed form verifying the execution of the consent.

After filing of the summons, affidavits and consents a hearing date will be allocated before the
Deputy Registrar.

The summons and affidavit material must be personally served on the incapacitated person and
their next-of-kin who are within the jurisdiction.

The plaintiff and other interested parties then attend on the summons date before the Deputy
Registrar. If the matter is not contested the papers will be referred to the Judge who will usually
make the orders sought without further appearance, assuming the evidence is in order.

If the matter is contested it will be listed for hearing.

If a manager other than the OPC is appointed the following must be filed with the court within 14
days of the order appointing the manager (pt 76 r 17):
1.    Draft orders
2.    Draft directions and authorities as to the powers of the manager
3.    An affidavit including:
      •     A summary of the scheme proposed for the administration and management of the
            estate of the protected person and for the maintenance of that person and his
            dependants;
      •     The assets and liabilities of the protected person; the income or estimated income
            of the estate;
                                                                                                      13
                                                                 Guide to Financial Management Options
                                                                 for Adults with a Legal Incapacity
                                                                 NSW




                      •      What debts (if any) are due from the protected person; to whom and whether the same
                             or any of them ought to be paid and out of what property;
                      •      In what manner, at what expense, by whom and where the protected person has been
                             maintained; what should be allowed for past maintenance; what, if anything, is due
                             and out of what fund the same ought to be paid,
                      •      What should be allowed for future maintenance; the date when the allowance ought to
                             commence;
                      •      The facts relating to any special directions as to administration and management.

              If the material filed in support of the original application included some or all of the above
              information then the affidavit filed with the draft directions can simply refer to the earlier affidavit
              and state that there has been no change.




Precedents/Application Forms
              ipac can provide precedent documents for applications to the court and tribunal, copies of any
              cases or legislation referred to in this guide and provide assistance in drafting affidavit material and
              other documentation.

              The   precedent documents that can be provided by ipac include:
              •      Draft orders
              •      Affidavit of private manager plaintiff
              •      Affidavit of Medical Practitioner
              •      Affidavit of fitness of manager
              •      Consent of proposed manager
              •      Draft directions and authorities
              •      Guardianship Tribunal application forms




Notes: 1 [1982] 2 NSWLR 700 2 [2005] NSWSC 581 3 Hodgson J, 27 June 1997. 4 [1983] 3 NSWLR 1 5 [2003] NSWSC 819
6 (1993) 31 NSWLR 227 7 C v H C v H & Anor [2002] NSWSC 733 8 Re L [2000] NSWSC 721 9 Re L 10 Holt 11 Re L
12 Extracted from Re L 13 MB v Protective Commissioner [2000] NSWSC 717 14 eg JS v Protective Commissioner & Anor [2003] NSWSC
621 15 [2000] NSWLR 717 16 M v Protective Commissioner [2002] NSWSC 421 17 Re McL [2001] NSWSC 280 18 Pt 76 r13 SC
Rules specifies that the usual order consequent upon declaring a person incapable of managing his or her affairs includes an order that the
manager give security to the satisfaction of OPC. More recently however the Court has stated that the appropriate order should that security be
given “to the satisfaction of the Court”. Re McL [2001] NSWSC 280




                                                                                                                                                  14

								
To top