The Best interests duty in the future of financial advice reforms : striking a balance between certainty and flexibility

Presentation delivered to the Australian and New Zealand Consumer Law Roundtable held at the University of Melbourne Law School on Friday, 16 November 2012. The paper covers the background to the 'Future of Financial Advice' reforms and their context. In addition to this the scope of best interests duty is discussed. The paper concludes with an assessment of the likely effectives of best interest duty as a consumer protection measure.

The effectiveness of the best interests duty : enhancing consumer protection?

This article considers the uncertainty surrounding the scope of the best interests duty which forms part of the Government’s Future of Financial Advice (FOFA) reforms. It is likely to be many years before the courts can interpret and clarify the content of the duty. Under the new regime, the provision of personal financial advice will be made more difficult, complex and costly and these costs will be passed on to consumers. The article also considers whether there will still be scope for delivering standardized, non-tailored advice in the light of the best interests duty. In the pas standardized advice has allowed large amounts of low-level, generic advice to be delivered very efficiently. In order to avoid breaching the best interests duty standardized advice should only be used rarely, and only after a careful assessment has been made to ensure that a standardized approach is appropriate.

The late discovery of adoptive and donor insemination offspring status : ethical implications for conceptual understandings of the ‘best interests of the child’ principle

Late discovery is a term used to describe the experience of discovering the truth of one’s genetic origins as an adult. Following discovery, late discoverers face a lack of recognition and acknowledgment of their concerns from family, friends, community and institutions. They experience pain, anger, loss, grief and frustration. This presentation shares the findings of the first qualitative study of both late discovery of adoptive and donor insemination offspring (heterosexual couple use only) experiences. It is also the first study of late discovery experiences undertaken from an ethical perspective. While this study recruited new participants, it also included an ethical re-analysis of existing late discovery accounts across both practices. The findings of this study (a) draws links between past adoption and current donor insemination (heterosexual couple only) practices, (b) reveals that late discoverers are demanding acknowledgment and recognition of the particularity of their experiences, and (c) offers insights into conceptual understandings of the ‘best interests of the child’ principle. These insights derive from the lived experiences of those whose biological and social worlds have been sundered and secrecy and denial of difference used to conceal this. It suggests that acknowledging the equal moral status of the child may be useful in strengthening conceptual understandings of the ‘best interests of the child’ principle. This equal moral status involves ensuring that personal autonomy and the ability to exercise free will is protected; that the integrity of the relationships of trust expected and demanded between parent/s and children is defended and supported; and that equal access to normative socio-cultural practices, that is; non-fictionalised birth certificates and open records, is guaranteed.

Is providing elective ventilation in the best interests of potential donors?

In this paper, we examine the lawfulness of a proposal to provide elective ventilation to incompetent patients who are potential organ donors. Under the current legal framework, this depends on whether the best interests test could be satisfied. It might be argued that, because the Mental Capacity Act 2005 (UK) (and the common law) makes it clear that the best interests test is not confined to the patient's clinical interests, but extends to include the individual's own values, wishes and beliefs, the proposal will be in the patient's best interests. We reject this claim. We argue that, as things currently stand, the proposal could not lawfully be justified as a blanket proposition by reference to the best interests test. Accordingly, a modification of the law would be necessary to render the proposal lawful. We conclude with a suggestion about how that could be achieved.

“Best interests” and withholding and withdrawing life-sustaining treatment from an adult who lacks capacity in the parens patriae jurisdiction

Disputes about withholding and withdrawing life-sustaining treatment are increasingly coming before Australian Supreme Courts. Such cases are generally heard in the parens patriae jurisdiction where the test applied is what is in the patient’s “best interests”. However, the application of the “best interests” test, and its meaning, remains unclear in this context. To shed light on this emerging body of jurisprudence, this article analyses the Australian superior court decisions that consider an adult’s best interests in the context of decisions about life-sustaining treatment. We identify a number of themes from the current body of cases and consider how these themes may guide future decision-making. After then considering the law in the United Kingdom, we suggest an approach for assessing best interests that could be adopted by Australian Supreme Courts. We argue that the suggested approach will lead to a more structured and systematic decision-making process that better promotes the best interests of the patient.

Withholding and withdrawing life-sustaining treatment in a patient's best interests : Australian judicial deliberations

•Intractable disputes about withholding and withdrawing life-sustaining treatment from adults who lack capacity are rare but challenging. Judicial resolution may be needed in some of these cases. •A central concept for judicial (and clinical) decision making in this area is a patient's “best interests”. Yet what this term means is contested. •There is an emerging Supreme Court jurisprudence that sheds light on when life-sustaining treatment will, or will not, be judged to be in a patient's best interests. •Treatment that is either futile or overly burdensome is not in a patient's best interests. Although courts will consider patient and family wishes, they have generally deferred to the views of medical practitioners about treatment decisions.

Submission on Financial Planning Association Consultation Paper

This report was submitted to the Financial Planning Association and is confined to the proposals in relation to compliance with the Best Interests duty (Part B) and the provision of Scaled Advice (Part C) in the FPA Consultation Paper, Modifications to the FPA Code of Professional Practice to incorporate FoFA, released in October 2012.

Raising levels of awareness of rights and obligations in the provision of financial product advice to retail clients

In September-December 2012, 548 financial planning retail clients and 77 financial advisers responded to online surveys addressing consumer satisfaction with financial planning services and the provision of information concerning regulatory and rights issues. Retail clients commented on areas related to the best interests duty in s 961B of the Corporations Act 2001 (Cth), in particular the extent to which advisers considered their clients’ financial objectives and lifestyle situations, and the client-centredness of the financial advice they received. Retail clients also indicated their level of awareness of their substantive rights in relation to receiving advice, the legal obligations imposed on advisers, and whether they would access internal and external complaints processes if warranted. Advisers reported on the extent to which they provide clients with information relating to their substantive rights, and complaints processes available to them. Responses were analysed in relation to client demographics (e.g., age, gender, education), and experience of financial advice. This article reports on the findings of the surveys and their implications for financial planners.

Identity and genetic origins : an ethical exploration of the late discovery of adoptive and donor-insemination offspring status

This thesis is an ethical and empirical exploration of the late discovery of genetic origins in two contexts, adoption and sperm donor-assisted conception. This exploration has two interlinked strands of concern. The first is the identification of ‘late discovery’ as a significant issue of concern, deserving of recognition and acknowledgment. The second concerns the ethical implications of late discovery experiences for the welfare of the child. The apparently simple act of recognition of a phenomenon is a precondition to any analysis and critique of it. This is especially important when the phenomenon arises out of social practices that arouse significant debate in ethical and legal contexts. As the new reproductive technologies and some adoption practices remain highly contested, an ethical exploration of this long neglected experience has the potential to offer new insights and perspectives in a range of contexts. It provides an opportunity to revisit developmental debate on the relative merit or otherwise of biological versus social influences, from the perspective of those who have lived this dichotomy in practise. Their experiences are the human face of the effects arising from decisions taken by others to intentionally separate their biological and social worlds, an action which has then been compounded by family and institutional secrecy from birth. This has been accompanied by a failure to ensure that normative standards and values are upheld for them. Following discovery, these factors can be exacerbated by a lack of recognition and acknowledgement of their concerns by family, friends, community and institutions. Late discovery experiences offer valuable insights to inform discussions on the ethical meanings of child welfare, best interests, parental responsibility, duty of care and child identity rights in this and other contexts. They can strengthen understandings of what factors are necessary for a child to be able to live a reasonably happy or worthwhile life.

Withholding and withdrawal of ‘futile’ life-sustaining treatment : unilateral medical decision-making in Australia and New Zealand

This article examines the law in Australia and New Zealand that governs the withholding and withdrawal of ‘futile’ life-sustaining treatment. Although doctors have both civil and criminal law duties to treat patients, those general duties do not require the provision of treatment that is deemed to be futile. This is either because futile treatment is not in a patient’s best interests or because stopping such treatment does not breach the criminal law. This means, in the absence of a duty to treat, doctors may unilaterally withdraw or withhold treatment that is futile; consent is not required. The article then examines whether this general position has been altered by statute. It considers a range of suggested possible legislation but concludes it is likely that only Queensland’s adult guardianship legislation imposes a requirement to obtain consent to withhold or withdraw such treatment.

Representing clients from courtroom to mediation settings : switching hats between adversarial advocacy and dispute resolution advocacy

In the vast majority of cases legal representation in mediation can provide many advantages for clients. However, in some, progress can be thwarted when lawyers do not understand the goals of the mediation process and their dispute resolution advocacy role. This article will explore some of the similarities and differences between the knowledge and skills that lawyers can draw upon when representing clients in adversarial court hearings as compared with non-adversarial settings, such as in mediations. One key distinction is the different approaches that legal representatives can use to effectively act in the best interests of clients. This article will highlight how an appreciation of such distinctions can assist lawyers to “switch” hats between their adversarial and non-adversarial roles. In particular, an understanding that the duty to promote the best interests of clients in mediation is consistent with a collaborative and problem-solving approach can greatly assist in the resolution process.

Optimal monitoring in family-owned companies? Evidence from Asia

Manuscript Type: Empirical Research Issue: We propose that high levels of monitoring are not always in the best interests of minority shareholders. In family-owned companies the optimal level of board monitoring required by minority shareholders is expected to be lower than that of other companies. This is because the relative benefits and costs of monitoring are different in family-owned companies. Research Findings: At moderate levels of board monitoring, we find concave relationships between board monitoring variables and firm performance for family-owned companies but not for other companies. The optimal level of board monitoring for our sample of Asian family-owned companies equates to board independence of 38%, separation of the Chairman and CEO positions and establishment of audit and remuneration committees. Additional testing shows that the optimal level of board monitoring is sensitive to the magnitude of the agency conflict between the family group and minority shareholders and the presence of substitute monitoring. Practitioner/Policy Implications: For policymakers, the results show that more monitoring is not always in the best interests of minority shareholders. Therefore, it may be inappropriate for regulators to advise all companies to follow the same set of corporate governance guidelines. However, our results also indicate that the board governance practices of family-owned companies are still well below the identified optimal levels. Keywords: Corporate Governance, Board Independence, Board of Directors, Family Firms, Monitoring.