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Don’t blindly trust the Public Trustee – there are alternative options available

Older man drafting a will at the Public Trustee Office

Take caution when making important decisions about who to appoint as your administrator to manage your legal and financial affairs. Attwood Marshall Lawyers Estate Litigation Senior Associate, Lucy McPherson, explains the issues with the Public Trustee Offices and why people should consider the alternative options available.

 

The QLD Public Trustee and NSW Public Trustee and Guardian

The Public Trustee offices perform certain roles in our community, including acting as executor/administrator of deceased estates and managing the financial affairs of vulnerable individuals who are incapable of managing their affairs on their own. There is a general assumption within the community that the QLD Public Trustee and NSW Public Trustee and Guardian are the most suitable and accessible options. However, these state bodies have a history of problematic dealings and gross mismanagement with many people negatively impacted after putting trust in these organisations.

It’s important for the community to understand the various options available when seeking assistance with drafting a Will, Executor services, financial administration and establishing and managing trusts. The services provided by the Public Trust Offices are not free, despite many people thinking that they are. People are commonly enticed by the offer of a “free Will” but during this process the Trust Office solicit work in relation to the administration of the Will-maker’s estate. We have found a common scenario is where the Public Trust office may encourage a Will-maker to appoint the Trust Office as Executor in the Will. When this occurs, the Trust Office will receive significant remuneration upon administering the Will-maker’s estate. Many people are not aware that they can receive a more personalised service from professionals and Private Trustee Companies.

What situations are the Public Trustee involved in?

Public Trust Offices are a statutory body who were created to provide services to assist those who are more vulnerable in our society. The sort of situations that Public Trust Offices can be involved in range from:

  • Acting as an Executor of an estate
  • Being appointed as Financial Manager of someone who may not have capacity to manage their own financial affairs. In New South Wales, this appointment is called Financial Manager, in Queensland this appointment is referred to as an Administrator.
  • Being appointed as a Trustee – if someone is unable to manage their finances – such as a minor, the Public Trustee can be appointed to manage investments, allocate allowances and manage trust funds.

There may be instances where someone who is caring for another person, such as a social worker, may contact the Public Trustee and express concerns for that individual and their capacity to manage their financial affairs. The Public Trustee can be involved in making an application through Queensland Civil and Administrative Tribunal (QCAT) or NSW Civil and Administrative Tribunal (NCAT) to take over the management of a person’s financial affairs.

Last year there were explosive claims made by clients of the Public Trustee in relation to their financial interests not being protected which caused significant financial loss and distress for those who had put their faith in the Public Trust Office. The allegations of a dysfunctional office culture and corrupt conduct should be a red flag to anyone who blindly accepts the Public Trust Office as the most suitable option to entrust their legal and financial affairs.

Previously in the media:

Brisbane Times – Misconduct Probe
ABC News – Man Sues NSW Public Trustee
Courier Mail – Whistleblower Slams Public Trustees Office
Brisbane Times – Public Trustee Suspended Amid Serious Allegations
SMH – NSW Trustee client dies in squalor

What are the alternatives to having the Public Trust Office appointed as your Financial Manager, Administrator or Trustee?

Many people do not realise that there are several alternatives, including professionals and Private Trustee Companies, who can administer deceased estates and manage protected estates/conduct the role of trustee. A Private Trustee Company endeavours to provide a more personal relationship with their clients and an overall better experience. The level of service that an individual receives through a Private Trustee Company is not comparable to that received through the Public Trust Office. The rates charged by both Public Trust offices and Private Trust Offices are comparable but they do vary between organisations, so it is important that people ask what the charges for services are.

What is the process for having the Public Trust Office removed and/or a Private Trustee appointed?

An application needs to be made to the Court to seek the removal of a Public Trust Office from the role of Financial Manager or Administrator and the appointment of the new Private Trustee.

The reason a Court application is required, as opposed to an application through one of the Tribunals such as NCAT or QCAT, is because when there is remuneration involved, the Court essentially needs to approve it.

The following process will apply when removing the appointment of the Public Trustee:

  • Make an application to the Court
  • Provide evidence before the Court in relation to why there has been some difficulties and why the relationship with the Public Trust Office has deteriorated.
  • Provide evidence of the suitability of the incoming Private Trustee Company.

Who can bring this type of application to the Court?

The individual in question generally doesn’t have legal capacity. Those who have impaired capacity are generally the subject of these types of applications.

Under the legislation it stipulates that any party with an interest can bring these types of applications before the Court.

People with a sufficient interest can include a family member, sibling or parent who may be concerned about the current situation.

What kind of evidence is required?

If the Court hasn’t dealt with the individual in question before – the following evidence will be required:

  • evidence that the individual does not have capacity, in the form of a medical report/s from a medical practitioner;
  • evidence from any family member about their opinion of the current situation. The Court wants to know the family is supportive of the application;
  • evidence in relation to the suitability of the incoming Private Trustee Company – which would usually take the form of evidence from the Private Trustee Company highlighting its experience in these types of situations and providing its consent and willingness to take on the role.

The court will also want to see financial reports in relation to the individual’s financial affairs and the nature of their protected estate.

How can Attwood Marshall Lawyers help?

Attwood Marshall Lawyers is a leading estate litigation firm with extensive experience in complex Public Trustee matters. We can provide legal services for those experiencing problems with the Public Trustees including assisting with:

  • matters involving the mismanagement of affairs under financial management orders
  • matters involving the mismanagement of estates where the Public Trustee has been appointed Executor
  • negotiating the exorbitant fees charged by the Public Trustees
  • applications to the Court to seek the Court to appoint alternative Trustees in the place of the Public Trustees

For all enquiries or if you would like further advice, please contact Estate Litigation Department Manager, Amanda Heather, on direct line 07 5506 8245, email aheather@attwoodmarshall.com.au or phone 1800 621 071.

 

Read more:

Families forced to take legal action against public trustees
There’s no such thing as a free Will
Unfair commissions and financial mismanagement – NSW Trustee and Guardian cannot be trusted
Inquiry into NSW Trustee and Guardian backed by politicians

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Lucy McPherson

Lucy McPherson

  • Senior Associate
  • Estate Litigation
  • Direct line: 07 5506 8255
  • Mobile: 0400 230 522