Memory impairments can significantly impact a person's ability to make reasonable judgments about their financial affairs.
In this blog post, I discuss how memory impairments can be a basis for the appointment of an administrator by the State Administrative Tribunal of Western Australia, as outlined in the Guardianship and Administration Act 1990 (GA Act).
Mental Disability and Estate Management
Under section 64(1)(a) of the GA Act, a person may be considered unable to make reasonable judgments about their estate due to a mental disability.
The term "estate" refers to the aggregate of a person's property, assets, and liabilities, which in practice encompasses their real and personal property and financial affairs.
The State Administrative Tribunal must determine whether the individual has the ability to make reasonable judgments about their estate (a subjective test) and whether they have the ability to engage in the mental processes required to make that judgment (an objective test).
Both tests must be satisfied for the Tribunal to appoint an administrator.
Memory Impairments and Decision-Making
Memory impairments, such as issues with short-term memory retention, can hinder an individual's ability to weigh the pros and cons of financial decisions.
This may lead to impulsive behavior and poor financial management, such as overspending, failing to budget, or making unreasonable demands on their funds.
However, it is important to note that not all individuals with memory impairments or mental disabilities will require an administrator. The Tribunal must be satisfied that the person's inability to make reasonable judgments about their estate is caused by their mental disability (a causal link) before they can appoint an administrator.
Case Example
In a recent case, VD [2023] WASAT 19, the State Administrative Tribunal found that a person with an acquired brain injury, which caused impulsivity, difficulties with executive functioning, and retention of information in short-term memory, was unable to make reasonable judgments about their estate.
The individual frequently overspent, failed to budget, and made unreasonable demands on their funds.
The Tribunal concluded that the acquired brain injury was the reason for their inability to manage their estate, and the requirements of section 64(1)(a) of the GA Act were met, resulting in the appointment of an administrator.
Conclusion
Memory impairments can have a significant impact on an individual's ability to manage their financial affairs.
In cases where a mental disability leads to an inability to make reasonable judgments about one's estate, the State Administrative Tribunal of Western Australia may appoint an administrator to protect the individual's best interests.
If you or a loved one are facing challenges in managing an estate due to memory impairments, please feel welcome to consult with me as a qualified guardianship lawyer, to explore your options. You can contact me here.