A 'free' will end up costing the Cora family $20,000
When Cora Whitfort needed to renew her will, she turned to the century-old trusted agency that made it free: the Queensland Public Trustee.
He wanted his estate to be divided equally among his four children and, to make sure it ran smoothly, he changed his previous will to make the Trustee the executor.
Cora developed dementia about two years later and when she died, “dementia” was listed on her death certificate.
This means that the Trustee as the executor has a legal obligation to conduct an “investigation” into Cora’s capacity when she made her will in 2011.
None of his family could have predicted the question would cause nearly two years of suffering for those left behind and cost him more than $20,000.
His son Chris Whitfort couldn’t understand why the authorities had gone so far when no one in the family had a problem with the will.
“He was trading stocks. He was driving, his doctor didn’t revoke his license at the time. So, nothing we saw in that period to suggest any cognitive decline,” Mr Whitfort told ABC Investigations.
Estates attorney Lucy McPherson said it should have been resolved much sooner because the officer who prepared the will told the General Trustee he would not do so unless he was satisfied that he had capacity at the time.
“One would expect a bit of common sense to win,” McPherson said.
“To meet the capacity issue on death certificates should require no more than a few additional hours of work.”
“You’re looking for additional work for under $1,000.”
Most importantly, the General Trustee had received a report early in his investigation showing that Cora had passed cognitive tests at her doctor’s surgery just three weeks before she left to make her will.
Mental assessments and doctor’s certificates are often requested by lawyers when parents make wills to ensure they have the capacity. Cora scored 27 out of 30 on her test, showing normal mental cognition.
The current CEO of Public Trust, Samay Zhouand, had no role at the time but said his lawyers were continuing to investigate “because they want to make sure that there is no other conflicting information”.
“Individuals involved can be frustrated by some of this. Unfortunately, by law, the General Trustee is required to fully inform the court so that … [it] fully informed and satisfied that the person has the capacity,” Zhouand told 7.30 in his first TV interview.
Ms McPherson said the extensive research of Public Trust offices and fees was unnecessary, and potentially an overservice.
“If all the people who are entitled to the inheritance do not interfere with the validity of this document, why should it take so long? It is not necessary at all,” he said.
Public Trust Lawyers pursued medical records as far back as 1995.
They also tracked down an administrative worker who had witnessed Cora’s signature on a will seven years earlier.
“It’s just a merry-go-round looking for information, and they’re going to get a little and it won’t be enough, and they’re going to have to get a lot more, and we never really know what the end goal will be,” said Mr. Whitfort.
Zhouand said that Public Oversight should continue the investigation because there was an earlier will in which Cora had promised her house to her grandchildren.
However, since the property had been sold, the two wills effectively equaled the entire estate passed to his four children, a fact the General Trustee accepted in his final application to settle the estate.
The estate was finally completed in 2019, nearly two years after Cora’s death. Chris Whitfort sued the lawsuit and found that the estate had been charged $378 per hour for his investigation into his mother’s capacity.
“I think it’s mining plantations and doing it right, legally in the letter of the law,” he said.
The Public Trustee of Queensland is a wholly self-funded authority, receiving nothing from the state government but relying on fees, commissions and taking a share of interest from its clients to operate.
Mr Zhouand said: “The fees and costs of the Legal Attorney’s office… are comparable to that of a mid-level company.”
He also apologized to the family “if the Trustee did not live up to their expectations” and encouraged them to file a complaint.
The guardianship office is accused of charging a fee for no service
Luka was only one and a half years old when his father, Clay, took his own life.
He does not have a will, so his estate, including $72,000 of his superfund, is handled by the General Trustee.
Luka’s mother, Helen, as a single parent with no income, needed financial assistance to care for her daughter, and for five years she was approved to use about $12,500 of the trust.
After that he said he had no contact with the Trustee for several years.
When he finally reached out to the office, he found Luka’s funds had dropped to $46,000 in 2013 and have remained at that amount ever since.
Zhouand told the ABC he could not speak about Luka’s case because he was a minor but said “the impact of the global financial crisis, and other factors such as withdrawals for maintenance led to a reduction in capital”.
Financial planner Dacian Moses reviewed Luka’s files and said the Trustee’s office made the “unforgivable” mistake of selling Luka stock at a loss after the global financial crisis and putting the money into a low-return cash account.
“The only time you really lock in a loss in the stock market is if you sell after the value drops,” he said.
In addition, over the past 16 years, the General Trustee has taken more than $14,000 in fees from Luka’s account which has exhausted all interest earned on the account.
“It’s going to work a lot better if it’s left in the bank account,” says Helen.
Luka is also charged a “service fee” of about $400 annually, but the ABC was unable to find evidence of any transactions on Luka’s behalf on his statement.
However, it also says it can charge $444 a year even if there are no transactions.
Luka’s statements over the past nine years show no evidence of any transactions on his behalf.
Mr Zhouand said the fees customers pay “include their support and service in terms of … paying for maintenance and paying bills and things like that”.
“We didn’t receive any support or service at all. We didn’t know these people,” said Luka’s mother.
“It will be an 18th birthday present for him from his father and it is very disappointing that it happened like this.
“I naturally have no trust in the General Trustee.”
Mr Zhouand said Public Trustee fees “are at the lower end compared to some private trustees” and Luka could file a review.
The Queensland General Trust Office invests Luka’s money in a fund it manages itself, allowing him to earn commissions and take a share of the returns.
This practice has been criticized by the Office of Public Advocates — another government agency that supports people with mental capacities — for running counter to the fiduciary duties of trustees.
“I think there’s an inherent conflict of interest in the business model with a Public Trustee because there’s revenue-raising activity within the General Trustee, when the General Trustee is supposed to be serving clients, for whom they’re acting,” said estate attorney Lucy McPherson.
Zhouand said investing client money in Public Trustee investment funds and taking part of the interest had been “authorized by many parliaments” to “fund operations and services to fund support for our vulnerable customers”.
“Most of the Trustee’s customers receive quality service at affordable prices. Therefore, there is always room for improvement,” he said, encouraging disgruntled clients to file a review.
Earlier this year, Four Corners exposed the treatment of financial administration clients under the Queensland Public Trust office including how they charged high fees and mismanaged their property and financial affairs.
The state government announced two questions after the program. Another review of the fees and charges – prompted by a scathing report from Public Advocates in 2021 – will be released by the government later this year.
Additional research by William Creamer
Catch the story tonight at 7:30 on ABC TV and ABC iview.
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