Public hearing 13: Disability services (a Case Study), Sydney - Day 3

CHAIR: Good morning, everybody.  Could I remind everybody that Commissioner McEwin is with me in Sydney today and Commissioner Galbally is joining the hearing from Melbourne.

I will commence with an Acknowledgment of Country.  We wish to acknowledge the Wangal people of the Eora Nation, the traditional custodians of this land, and pay our respects to their Elders past, present and emerging.

We also acknowledge the Wurundjeri people of the Kulin Nation, upon whose lands Commissioner Galbally is joining this hearing.  We pay our respects to their Elders past, present and emerging.  We also pay our respects to all First Nations people attending in person today, as well as those who are following the hearing on the livestream.

Yes, Ms Eastman.

MS EASTMAN:  Good morning, Commissioners, and good morning to everyone following the proceedings.

Commissioners, you will see that Ms Cuddihy is in the room and ready to give her evidence.  Before we do so, I think Ms Furness wishes to give you an update on the progress of some submissions that you have asked for.

MS FURNESS:  Thank you.  Chair, there was a discussion on Monday in respect of the Ombudsman.  We indicated that we would provide submissions.  They will be provided in writing to you, I hope, shortly, but certainly today.

CHAIR:  Thank you very much.  Ms Eastman.

MS EASTMAN:  Ms Cuddihy needs to take her oath or affirmation.

CHAIR:  Yes.  Would you be good enough, Ms Cuddihy, to follow the instructions of my associate, who will administer either the oath or affirmation, as the case may be.  The oath.  Thank you.

CAROLINE CUDDIHY, SWORN

EXAMINATION IN CHIEF BY MS EASTMAN

CHAIR:  Thank you, Ms Cuddihy, and thank you for your appearance today.  Ms Eastman will now ask you some questions.

MS EASTMAN:  Your name is Caroline Cuddihy?

 
MS CUDDIHY:  Yes.

MS EASTMAN:  You are presently the Chief Executive Officer of Sunnyfield Disability Services?

MS CUDDIHY:  Yes.

MS EASTMAN:  You have prepared a statement for the Royal Commission; is that right?

MS CUDDIHY:  Yes.

MS EASTMAN:  You have three corrections that you wish to make to the statement.  Do you have a copy with you there?

MS CUDDIHY:  Of the statement, yes.

MS EASTMAN:  The first correction is to paragraph 46 on page 3.  Just confirm, the correction you want to make is in the final line and you want to delete "2018" and replace that with "2017"; is that right?

MS CUDDIHY:  Correct.

MS EASTMAN:  The next correction is at paragraph 174 on page 7.  The correction is at subparagraph (f).  You will see there is a redaction that refers to "Melissa".  Would it help if I read the paragraph and you can let me know if the correction I identify is correct?

MS CUDDIHY:  Thank you.

MS EASTMAN:  The paragraph should read:

In early January 2018, Sunnyfield also became aware that Melissa's guardian had separately reported the matter to the police.

So the correction is not that Melissa had reported to the police but Melissa's guardian; is that correct?

MS CUDDIHY:  Yes, thank you.

MS EASTMAN:  The next correction you wish to make is to paragraph 180(b) on page 38.  There are two corrections in that paragraph.  On the second line, the correction is to the date.  Instead of "2 October 2018" that should be "2 October 2019"; is that right?

MS CUDDIHY:  Yes.

 
MS EASTMAN:  On the final line in paragraph 180(b), the date of "23 or 24 September 2018" should be "23 or 24 September 2019"?

MS CUDDIHY:  Yes.

MS EASTMAN:  Those are the corrections that your solicitors have provided to the Royal Commission.  Have you had a chance to read over the statement recently?

MS CUDDIHY:  Yes.

MS EASTMAN:  Have you identified any other corrections or any other amendments that you wish to make to the statement?

MS CUDDIHY:  Not to my knowledge.

MS EASTMAN:  Can you tell the Royal Commission that what you have said in your statement is true?

MS CUDDIHY:  Yes, it is true.

MS EASTMAN:  With respect to your statement, the organisation of your statement is in response to a notice issued to Sunnyfield to provide a statement.  If we look at the structure of your statement, your statement answers the particular questions raised in the Royal Commission's Notice to Give a Statement; is that right?

MS CUDDIHY:  Yes.

MS EASTMAN:  Commissioners, the approach taken in this statement is that Ms Cuddihy has not set out in a chronological fashion the various events, but she has sought in this statement to respond to the particular questions raised in the Royal Commission's notice.

CHAIR:  Yes, thank you.  I think that's apparent from the form of the statement.

MS EASTMAN:  Commissioners, you will also have observed that there are a number of documents that are identified by the Royal Commission's coding numbers in the statement.  You have a copy of those documents in tender bundle A.  When we get to various documents, I will take you to the particular document as it appears in tender bundle A.  There are some documents in tender bundles B and C that we will need to take you to.  Then there is a small set of documents that haven't made their way into the tender bundle but have been produced to the Royal Commission, and we will take you to those documents in due course.

CHAIR:  Have we made arrangements for Ms Cuddihy to have access to the documents when they are referred to?

MS EASTMAN:  We have.  You will see that our exemplary paralegal from the  
OSA team is sitting with the Commissioner's associates.

CHAIR:  Is that the only exemplary paralegal?

MS EASTMAN:  They are all exemplary.  We have a hard copy, so as I reach different parts of Ms Cuddihy's statement and we need to refer to particular documents, a hard copy will be given to Ms Cuddihy as we travel along.

For those following the webcast, today may raise some frustration for you that many of the documents we will use in the hearing today have not been the subject of redactions.  For that reason, I will not be putting up many of the documents on the screen, so it may be difficult for people to follow.  But I will do my best to ensure that I describe the relevant documents and if I take Ms Cuddihy to a part of the relevant document, I will take time to identify those parts of the document that I am taking her to.

CHAIR:  Thank you.

MS EASTMAN:  So, I suppose I am asking people following the webcast and those in the room that it may be a little slower than expected, but please be patient.  As I said at the beginning of the hearing, we will tender documents in due course, so the documents we touch on during the course of this examination may be tendered, subject obviously to the Commissioners' directions.  That is just a little bit of how I hope we can organise the morning and throughout the day.

Ms Cuddihy, can I come to you now.

MS CUDDIHY:  Yes.

MS EASTMAN:  You are, as you have said, the CEO of Sunnyfield.  How long have you held that role?

MS CUDDIHY:  Since November 2010.

MS EASTMAN:  You tell the Royal Commission at paragraph 4 of your statement that prior to assuming the role of CEO of Sunnyfield, you were a national general manager for an Australasian fast moving consumer goods company for seven years.  I'm intrigued by what is a fast moving consumer goods company?

MS CUDDIHY:  It's a food company.

MS EASTMAN:  Was that in a hospitality setting or in a retail setting?  Can you help us a little more?  I just want to understand your background and your work experience.

MS CUDDIHY:  Certainly.  It provides food services or food products, I should say, both retail and food     well, to retailers and to food service organisations.  So it  
provides those products in Australia and New Zealand.

MS EASTMAN:  You don't want to mention the name of the company?

MS CUDDIHY:  I don't think that's appropriate.

MS EASTMAN:  Before that, you were an executive director for a large aged care provider, and that's a position that you held for about 11 years; is that right?

MS CUDDIHY:  That's correct.

MS EASTMAN:  You have told the Royal Commission that you have over 13 years experience in the disability support services sector.  Is all of that experience in your work at Sunnyfield?

MS CUDDIHY:  Yes, it is.

MS EASTMAN:  You haven't worked for any other disability support service provider?

MS CUDDIHY:  No.

MS EASTMAN:  You haven't worked for any relevant government agency that was involved in either delivering services in the past or regulating the disability support sector; is that right?

MS CUDDIHY:  That's correct.

MS EASTMAN:  You have followed the proceedings over the last few days; is that right?

MS CUDDIHY:  That's correct.

MS EASTMAN:  You haven't been here in the hearing room; is that correct?

MS CUDDIHY:  That is correct.

MS EASTMAN:  But you have followed it on the Royal Commission's webcast?

MS CUDDIHY:  Yes.

MS EASTMAN:  So you have had an opportunity to listen to the evidence of Eliza, Sophia and Jennie Piaud yesterday?

MS CUDDIHY:  That's correct.

MS EASTMAN:  I want to ask you a little bit about your qualifications.  With  
respect to the qualifications, you tell the Royal Commission that you have a Certificate in Governance and Risk Management from the Governance Institute of Australia and you identify the date 2020.

MS CUDDIHY:  Right.

MS EASTMAN:  Can I first of all ask you, what is the Governance Institute of Australia?

MS CUDDIHY:  It's an organisation that specifically is involved in looking at organisational governance and also risk management.  I undertook a course over a number of modules and completed a certificate, as that was an area that I thought was of interest to myself in my role.

MS EASTMAN:  What was the nature of the course that you undertook? Was it an online course or did it require in person training?

MS CUDDIHY:  Both.

MS EASTMAN:  How long did the course take?

MS CUDDIHY:  It was a number of modules.  I actually had started it pre COVID 19 and completed it online at the end of 2020.

MS EASTMAN:  What was it that caused you to undertake this particular course on governance and risk management in 2020?

MS CUDDIHY:  It's an area of interest to me.  I'm very interested in organisational governance, looking at how one can improve that.  There have been other Royal Commissions, the Banking Royal Commission, those things to improve, and that's part of my approach, to look at continuous improvement.  I was also interested more in terms of governance and risk management and that was a very useful course.

MS EASTMAN:  Had you done any specific training or courses on governance and risk management before undertaking this course in 2020?

MS CUDDIHY:  I've undertaken the Australian Institute of Company Directors graduate program and I've undertaken a number of short courses previously.

MS EASTMAN:  But I'm asking you specifically, not the general courses that you may have done, but specific courses or training on governance and risk management.

MS CUDDIHY:  Not particularly on risk management but I have undertaken some one day or half day courses with the Australian Institute of Company Directors.

MS EASTMAN:  Would it be fair to say that by 2020, it wasn't just a matter of your interest but that you reached a point where you felt you needed to increase your  
understanding, skills and learning on governance and risk management?

MS CUDDIHY:  I've always had an approach to continuous improvement.  I've also had the privilege to attend the Stanford NonProfit Leaders Program, so I've always taken an approach to continuous learning.  There was the opportunity to undertake this course.  It's an area in our organisation that I think is evolving and I wanted to know more about it.

MS EASTMAN:  I'm going to ask you shortly about how your performance management is measured.  Before I do that, it may be of assistance to the Royal Commissioners to understand a little bit more about Sunnyfield and its organisation, so I want to turn to that topic now.

You have told the Royal Commissioners in paragraph 8 that Sunnyfield is a member based for purpose not for profit registered charity, providing support services for over 1,200 people living with disability in New South Wales and the ACT.  First of all, I want to ask you, what is meant by a member based organisation?

MS CUDDIHY:  Sunnyfield has a very proud history of being formed by family members, nearly 70 years ago now, who have children with disability.  Back in the 1950s there were not a lot of supports for people who had a child with a disability and so a group of families got together and they initially formed an association which subsequently became     it was the Sunnyfield Association, which subsequently became Sunnyfield.  Our constitution holds dear the foundations of the organisation, so we are an organisation that is very passionate about supporting people with a disability.

MS EASTMAN:  Can I just interrupt you there.  I just want to know what member based means.

MS CUDDIHY:  Yes.  Member based means that the foundations of our organisation, as being member-based, means that any of our clients may     their guardian or family member may choose to become a member of Sunnyfield.  They would apply to the board and the board would make a decision in regards to their membership.  We currently have over 500 members, I believe.

MS EASTMAN:  So a member is someone who represents either a person with a disability; is that right?

MS CUDDIHY:  That's correct.

MS EASTMAN:  Or a connection to a family member of a person with disability?

MS CUDDIHY:  Yes.

MS EASTMAN:  When you talk about the constitution, you have provided to the Royal Commission     Commissioners, this is hearing bundle B, volume 1, tab 1.   
That's a copy of the Sunnyfield constitution, incorporating amendments up to 25 October 2018.  I will give you that document.  The description that you just gave in relation to members, that is set out in the constitution at clause 7 on page 7 of the constitution; is that right?

MS CUDDIHY:  Yes.

MS EASTMAN:  Clause 7.4 explains:

Membership of Sunnyfield may be granted as either a family member or general member.

That describes the two classes; is that right?

MS CUDDIHY:  Correct.

MS EASTMAN:  I will ask you to put that constitution back.  We may come back to that.

In terms of the organisation being a not for profit registered charity, does that reflect Sunnyfield's origins?  I have seen either variously 66 or 70 years ago, it was set up by family members of people with disability to provide services for people with disability and the model that it used was a charitable organisation.

MS CUDDIHY:  It is, to my knowledge, a registered charity.  It does seek fundraising from the community and it works within each of the communities, and that's its basis.

MS EASTMAN:  What does this mean in terms of the governance and operation for Sunnyfield as a not for profit registered charity?  Are there any particular rules that you have to observe.

MS CUDDIHY: Certainly we need to comply with the Charities Act and as a not for profit, it also means that any earnings for the organisation are retained earnings and those earnings are not distributed to any shareholders, so that there is no distribution of funds to other parties outside of the organisation and that reinvestment of funds is to continue the services into the future of the organisation for the benefit of people with disability.

MS EASTMAN:  As you know, the Royal Commission's inquiry is in relation to the particular house in Western Sydney that is Melissa's, Carl's and Chen's home.  Before we turn to that, it may assist the Royal Commissioners to have an understanding of Sunnyfield's operation generally.  At paragraph 9 you set out the core services and you say that for shared independent living, Sunnyfield operates 48 homes.  Is that a reference to what sometimes is called a group home?

MS CUDDIHY:  That is terminology that used to be used in the past.  We called  
them shared independent living homes and we see those homes as the homes of the client.

MS EASTMAN:  In terms of those 48 homes, you tell the Royal Commission that there are 215 residents who occupy those homes; is that right?

MS CUDDIHY:  Yes.

MS EASTMAN:  Are the homes all three bedroom or four bedroom homes?

MS CUDDIHY:  The largest home we have is five residents.  There is one home, I think, that has five residents with a, sort of, semi-detached separate one bedroom apartment.  But that is     the homes will range from two residents to five residents.

MS EASTMAN:  But the smallest home is a two bedroom or a two person residence?

MS CUDDIHY:  I believe so.  And it may depend on     there's the house design and how many residents it could have.  For example, the house we are talking about at this Commission actually has five bedrooms but there are currently only three residents.

MS EASTMAN:  In terms of the 48 homes, does Sunnyfield own the properties for all of those 48 homes?

MS CUDDIHY:  Sunnyfield has a mixed portfolio.  The organisation has set up a separate company called Gateway.  Gateway is a community housing provider and we are endeavouring to put our own property portfolio and our shared living homes in Gateway and meet all of the compliance standard for the community housing provider.

MS EASTMAN:  I think you mention later on in your statement about Gateway and some trusts and some of the vehicles used by Sunnyfield.

MS CUDDIHY:  Yes.

MS EASTMAN:  I will come to those a little bit later.  But just coming back to the 48 homes, are you able to tell the Royal Commission, just generally, with respect to those homes, how many homes might be relatively new, say, built in the last five years or acquired by Sunnyfield in last five years?

MS CUDDIHY:  We have quite a diverse portfolio.  We do have 10 houses that were associated with the New South Wales large residential centre devolution program.  So we have those 10 and I think we also have a couple more houses that would be newer.  But we do have quite a mixed range portfolio of housing.  Needless to say, we are continually wanting to improve the quality of the housing stock for people with disability.
 

MS EASTMAN:  Are any of the homes, in the 48 homes that have been acquired, from other disability service providers, not government but private providers?

MS CUDDIHY:  We have purchased some homes from the open marketplace, we lease some homes, we do have lease arrangements with DCJ, Department of Communities and Justice, and we own some homes.

MS EASTMAN:  Can I ask you a little bit about the 215 residents.  I'm not going to ask you about each one separately.  With respect to those residents, what is the average period of time the residents would spend at a Sunnyfield shared independent living residence?  Is there an average period of time?

MS CUDDIHY:  We have some residents who, on my understanding, have been with the organisation for I think over 30 years, possibly even 40 years.

MS EASTMAN:  You say over 30 years?

MS CUDDIHY:  Yes, we do.  We have some newer residents and we have some very longstanding residents.

MS EASTMAN:  What is the average time?

MS CUDDIHY:  I couldn't answer that question, I'm sorry.

MS EASTMAN:  Looking at those 215 residents, are you able to tell the Royal Commission whether those residents living in a Sunnyfield shared independent living setting, that this would be their last place of residence?

MS CUDDIHY:  If that's their choice.  If that were to be what they wanted and we could provide the services safely to them, then we would endeavour to do that.

MS EASTMAN:  If any of the 215 people who are currently residents said to Sunnyfield that they want to stay in the home for the rest of their lives, then that would be an option open to them; is that right?

MS CUDDIHY:  Likewise, in all of these situations, it needs to be one of mutual benefit.  If that was the desires of the resident, also the desires of the family,  and we felt that we could provide them the quality and the services and that was a relationship of mutual benefit, then certainly that has been the case.

MS EASTMAN:  Does Sunnyfield have a policy in relation to transitioning people with disability who are residents in a Sunnyfield home to different types of accommodation?  I haven't made that clear.  What I mean by that is that somebody may come into a Sunnyfield home and while they are at that home, you work with the residents to look at other options, but the home is really a transition point rather than a final destination.  Do you have a policy around transitions of that kind?
 

MS CUDDIHY:  We don't, to my knowledge, have a policy.  We do have some services which we would call short term accommodation, which    

MS EASTMAN:  Sorry to interrupt you.  I think they are the three short term accommodations.

MS CUDDIHY:  Yes.

MS EASTMAN:  I want to focus on the 48 homes.  I apologise if I didn't make myself clear.  Looking at the 48 homes and the residents in those 48 homes, does Sunnyfield have a policy of actively looking at assisting any of those residents to transition out or move to different forms of accommodation?

MS CUDDIHY:  Not to my    

MS EASTMAN:  Or do you see it as a more permanent arrangement?

MS CUDDIHY:  Not to my knowledge, no.

MS EASTMAN:  Have any of the residents, to the best of your knowledge, made inquiries with Sunnyfield to say, "I'm not just after short term accommodation but I want to develop my independence and my choices while I'm at Sunnyfield, to look at what might be other options for me in the future."

MS CUDDIHY:  If that was a person's goal and that was what they were seeking, then we would be very happy to assist them in that.

MS EASTMAN:  How would they identify that goal while they are at a Sunnyfield home?

MS CUDDIHY:  The primary focus of people setting their goals is through the NDIS and so in people's service agreements, their goals are an attachment as, I think, the first annexure to their service agreement, and we actively support and work with that person to achieve their goal.

MS EASTMAN:  Is there a commercial benefit or a commercial interest for Sunnyfield keeping the residents in a Sunnyfield home?

MS CUDDIHY:  I suppose you could put that perspective.  But at the end of the day, we focus on a person centred active support model and if someone was not happy and that was not their wishes, we would certainly support them in what their goals and their wishes are.

MS EASTMAN:  I suppose I'm asking you a little bit beyond what's, sort of, happy and what their wishes are, but to look at a different model of the way somebody might want to live, other than living in a group home.  I accept some people would  
like to live in a group home and with others.

MS CUDDIHY:  Yes.

MS EASTMAN:  But others might want different options.

MS CUDDIHY:  Correct.

MS EASTMAN:  What I'm trying to explore with you is once residents are at the Sunnyfield home, how are those other options explored?  Sorry, there are a lot of questions there.  But am I right in understanding that unless it's in the NDIS goals, is there another way in which those objectives or goals could be identified?

MS CUDDIHY:  I think you ask a very good question.  It is a strategic issue, and we have discussed it in our strategy, around how can we provide more affordable housing options for people with disability.  I think there's about a 9 per cent vacancy rate across the sector to do with specialist disability accommodation.  A lot of times people with intellectual disability are not getting any SDA funding and that's a vexed issue.

MS EASTMAN:  If we are going to use some NDIA jargon, if we do that, so we are both on the same page on that, that's Specialist Disability Accommodation, SDA; is that right?

MS CUDDIHY:  Yes.

MS EASTMAN:  What's your understanding of SDA and how does that work?

MS CUDDIHY:  My understanding of SDA is that it's an NDIS initiative to increase housing stock that's suitable for people with a disability.  There is criteria in terms of the design of the house and there's various levels and standards of the design, with various features.  That can then     for a person with a disability who meets the criteria to get SDA funding, it can help them to then go shopping and choose appropriate accommodation to their needs.  But it means that they would need to potentially have the SDA funding approved in advance, to the category of the house and the way the house is designed.

MS EASTMAN:  When you use the word "shopping", do you mean that the person with disability can go into the open property market and, with their SDA funding, then look for accommodation or buy property in the open market?

MS CUDDIHY:  They could do that, I would imagine.  But I think it also is that there are people, to my knowledge, that have designed and built SDA housing and that is available too in the open market.  That SDA funding enables the affordability for them to go into that type of housing stock, that's specially designed to meet the needs of a person with disability.  And there are various different categories.

 
MS EASTMAN:  Can I come back to the 48 homes and the 215 residents.

MS CUDDIHY:  Yes.

MS EASTMAN:  This aspect of Sunnyfield's services constitutes 9 per cent of the total services that Sunnyfield operates; is that right?

MS CUDDIHY:  Yes.

MS EASTMAN:  That 9 per cent of your services also constitutes almost half of Sunnyfield's overall income, 47 per cent of the income; is that right?

MS CUDDIHY:  I believe so.  I believe it's also the NDIS     the people who are accessing shared independent living and SDA is a high proportion of the NDIS budget.

MS EASTMAN:  That figure that I have given you appears in the 2020 annual report.  If you are uncertain about that, I can take you to the document.  But I think you have agreed that it's almost half of the Sunnyfield revenue; is that right?

MS CUDDIHY:  I would believe so.

CHAIR:  Ms Eastman, I understand from what I have seen that there are actually two documents.  There is an annual report for 2020 that does not include detailed financial information and there are financial statements for the    

MS EASTMAN:  There are.

CHAIR:  I assume you are referring to the financial statements?

MS EASTMAN:  Yes, I am, and I will come to the annual report and the financial statements in a lot of detail.

CHAIR:  Yes.  I am just making the point that there are in fact two separate documents.

MS EASTMAN:  I am very slowly trying to set the scene here.  But, Chair, I will come to those documents in due course.

Can I suggest to you that if one looks at the 48 homes and the revenue for Sunnyfield with respect to the 48 homes, would you accept there is an incentive in maintaining the 48 homes and those homes being occupied, for Sunnyfield?  That's an incentive from a revenue perspective to keep those homes operating and occupied?

MS CUDDIHY:  I believe there could be.  I think it depends on your perspective, whether as an organisation you're purely looking at the financial situation or whether you're actually looking at the clients and their wants, their wishes and what suits  
them best.

MS EASTMAN:  While you're on wishes and what suits them best, you have heard the expression "choice and control"?

MS CUDDIHY:  Yes.

MS EASTMAN:  Do you understand that to be a phrase that reflects the ethos of the National Disability Insurance Scheme?

MS CUDDIHY: Yes.

MS EASTMAN:  What's your understanding of choice and control with respect to the residents, the 215 residents, who live in shared independent living in the 48 homes operated by Sunnyfield?  What does choice and control mean for them?

MS CUDDIHY:  I would just like to say that Sunnyfield actually contributed funds to the campaign to get this up and away and we are big supporters of choice and control for people with disability.

MS EASTMAN:  Can I come back to my question?

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  Can you answer that?

MS CUDDIHY:  Yes, certainly.  Choice and control means that each resident and their guardian or family member who may be assisting and working with them has the choice of whether they want to live in that home or not and they have the control over whether they want to live in that home or not.  At the same time, that works within our contractual arrangements.

MS EASTMAN:  Do they have the choice about who they live with?

MS CUDDIHY:  Yes, we do.  We do a lot of work when it comes to any vacancies, and it takes a very long time to do a transition, to make sure that it is something that all of the residents would want and like, and we take their feedback and their family's feedback into great consideration.

MS EASTMAN:  How do you do that at a practical level?  The Royal Commissioners heard a little bit about the residents at the Western Sydney house.  If those residents are generally reflective of the cohort of the 215 residents in the 48 homes operated by Sunnyfield, can you explain how choice and control might work on a practical level?

MS CUDDIHY:  Is that in regards to a new resident coming into the home or    

 
MS EASTMAN:  We can take a new resident.  How would choice and control work?

MS CUDDIHY:  My understanding is, in the home in Western Sydney specifically related to this Commission, the express wishes of the families is that the cohort is not increased from the current three residents and that when one of the previous residents exited, could we then approach the NDIS to have the home considered as a three person home, which I understood that's what we did.

MS EASTMAN:  How do you work out or ask the residents what they want?  How do you do that practically?

MS CUDDIHY:  It depends on each individual resident.  There certainly is that person's goals in their NDIS plan, which we respect.  It's also working individually with each client and also with their family, understanding what their needs and wants are, what their wishes are.  We do try and tailor our supports to     and the roster of care is tailored directly to what the families or the person has requested, and that roster is designed around what they have asked for.

MS EASTMAN:  What happens for a person who doesn't have a family to speak on their behalf or about them?

MS CUDDIHY:  This is a real challenging issue.  We have an advocacy policy, which you have seen.  But we have clients who can speak for themselves and we will sit and support and encourage them.  But, particularly, it can be a challenge where the trustee and guardian are involved or where the person doesn't have the representation that they need.

MS EASTMAN:  Of the 215 residents that you have described in your statement, how many of those residents are people who have no family or guardian to speak on their behalf?

MS CUDDIHY:  I'm sorry, I don't have that information with me.

MS EASTMAN:  With respect to the involvement of family, if there's a conflict between what the family thinks might be best for their family member and the person with disability and what he or she would like, how is that navigated on choice and control?

MS CUDDIHY:  That is a challenging area, I agree.  We try and work directly with the client and with the family and try to be respectful about the different views, to try to come to an agreement about what is suitable, but that can be difficult sometimes.

MS EASTMAN:  The concept of choice and control, you understand that that's choice and control for the person with disability; that's right?

MS CUDDIHY:  Yes.

 
MS EASTMAN:  It's not choice and control for the service provider, is it?

MS CUDDIHY:  I think there is always in any agreement, and I think this is a very positive thing, that it should be of mutual benefit.  So I think at the end of the day    

MS EASTMAN:  It is a different thing, isn't it?  Mutual benefit is a different thing to choice and control?

MS CUDDIHY:  Yes.  Choice and control is very much the language of the NDIS and I truly do respect that language.

MS EASTMAN:  But if a service provider says it has choice and control, that's a very different thing, isn't it, to a person with disability who receives services, to their sense of choice and control?  Would you accept that?

MS CUDDIHY:  Yes, I would.

MS EASTMAN:  If a service provider says it has choice, that suggests that the service provider can choose who it will accommodate and who it won't?

MS CUDDIHY:  I think that, at the end of the day, service providers need to make an assessment as to whether they have the skills and capability and the staffing, the circumstances, to be able to provide the services in good faith.  I don't think it would be a good thing to enter into any agreement if the service provider felt they couldn't provide the appropriate services.

MS EASTMAN:  If a service provider has that choice and control, and the control aspect is something that is of benefit to the service provider, how does that sit with the person with the disability having independence if it's the service provider who exercises control?

MS CUDDIHY:  Yes, no, I think the word "control" is not a word that I would specifically use.

MS EASTMAN:  If, for example, Sunnyfield has said on an occasion that it has choice and control, that would not be language that you would expect to see Sunnyfield use, describing it having choice and control?

MS CUDDIHY:  Yes, and I understand that was said in regards to the residents at this particular house.

MS EASTMAN:  You heard evidence from Eliza this week, where     and we will get to whether you call it the notice of cessation of services or eviction, but you are aware, aren't you, that she has given some evidence earlier this week about Sunnyfield saying that flexibility of choice and control is conferred on both the participant and the service provider?  You remember her saying that?

 
MS CUDDIHY:  Yes, I do.

MS EASTMAN:  If you need to have a look at the document, it's tender bundle A, part 2, at tab 30.  We might look at this now, Commissioners, so I don't forget to come back to it later.

May I draw your attention to the first paragraph of the letter.  Tell me when you have had a chance to read that to yourself.  You recognise this as a letter sent from the General Manager Shared Living to Eliza and it has the date 13 June 2018?

MS CUDDIHY:  Yes.

MS EASTMAN:  The General Manager Shared Living says in the letter:

The decision does not need to be mutually agreed and nor does Sunnyfield need to provide any reasons for exercising its option to terminate the agreement.  This approach is consistent with the underlying ethos of the NDIS, where flexibility of choice and control is conferred on both the participant and the service provider.

That's what the letter says?

MS CUDDIHY:  Yes.

MS EASTMAN:  Were you aware of the contents of this letter on or around 13 June?

MS CUDDIHY:  I was aware we were writing a letter, yes.

MS EASTMAN:  Did you approve a draft letter to go to Eliza?

MS CUDDIHY:  I can't specifically recall that.

MS EASTMAN:  To the best of your recollection, did you see a letter in this form before it was sent to Eliza?

MS CUDDIHY:  I cannot     I can't comment because I don't specifically recall that.

MS EASTMAN:  Do you accept that the sentence that says "This approach is consistent with the underlying ethos of the NDIS, where flexibility of choice and control is conferred on both the participant and the service provider" is wrong?

MS CUDDIHY:  I think it's certainly taken out of context, yes.

MS EASTMAN:  It shouldn't have been described in that way, should it?

MS CUDDIHY:  No.  Choice and control, under the NDIS, specifically relates to the person with a disability.
 

MS EASTMAN:  Do you know if anyone has ever told Eliza that what was said in this letter, that choice and control is conferred on both the participant and the service provider, was not right?

MS CUDDIHY:  I don't believe anyone has.

MS EASTMAN:  Why not?

MS CUDDIHY:  I don't know the answer to that.

MS EASTMAN:  Thank you.  I apologise for doing a little bit of a detour.  Can I bring you back to your statement at paragraph 9.  We have addressed the 48 residences and the 215 residents.  In terms of accommodation services, Sunnyfield also operates three short term accommodation services and, you say, a fluid number of residents.  You have told the Royal Commission, as at the end of March this year, there are 101 clients and that represents almost a 50 per cent increase as at 30 June, so an increase of 48 clients.

Can you tell us, what is the nature of short term accommodation services and what can you tell us about the three short term accommodation services?

MS CUDDIHY:  Sunnyfield has currently three and we are contemplating a fourth.  These are services for people who are seeking a whole variety of different needs.  We have some younger people who access these services and that is an opportunity for them to learn about living out of home and gain new skills.

MS EASTMAN:  When you talk about younger people, what age group are you talking about?

MS CUDDIHY:  We have, I think, a children's service.  These would be above     these would be school age children.  But we also have some youth as well who may be accessing those services.  And, of course, we don't have a mixed cohort at the same time.  We have other areas where there are people who are in dire need of accommodation, for various circumstances, and where we can     where it's something that they choose and where we can assist them, they would utilise those services.  It may be that someone is in a situation where, unfortunately, their family is not able to support them, for a variety of very valid reasons.  We would help them as well in that service there.

So it's quite     very dependent on the individual and what we are trying to do there is to     usually, it's very much a transition situation, in trying to create an environment of trust, support and where they can feel safe at home and also prepare themselves for transitioning to some other form of accommodation.

MS EASTMAN:  These are all services for people with disability?

 
MS CUDDIHY:  That's correct.

MS EASTMAN:  Is it only a service for people with cognitive or intellectual disability?

MS CUDDIHY: Sunnyfield's client base is primarily that.  But they may have acquired their disability in a number of different ways.

MS EASTMAN:  Can I ask you about the community services.  Commissioners, this is paragraph 9(b).  With respect to community services, you have 1,192 clients from 21 community services hubs and that's an increase in 2020 of 879.  That's a very significant increase over the last year; is that right?

MS CUDDIHY:  We have been expanding our services and we have been working with people to fulfil their needs.

MS EASTMAN:  What is the nature of the community services provided to the over 1,000 clients, and can you tell us a little bit about the 21 community services hubs?

MS CUDDIHY:  There is a range of services that we support in the community.  We do in-home services, where we are providing services to clients in their own home.  Some of those services are in regional areas.  We also then have community hubs where, if people prefer, they can come to a centre and there is infrastructure in that centre.

MS EASTMAN:  What does that mean, infrastructure?  Is it a house, is it a community hall?  Can you explain a little bit about it?

MS CUDDIHY:  It can be very wide and diverse, depending on the communities we are in.  We have facilities in rural areas, we have some facilities that are in church halls.  We have a variety of different facilities that depend on the locality.  We try and very much work with the local community and develop those services.  The sort of infrastructure could be computers, sensory room, various equipment; classes, activity programs, kitchens where people     they are flexible kitchens where people can be involved in cooking.  They are very much about where people can build and develop their skills, learn and also have fun. 

MS EASTMAN:  Are these     would the community services include what's commonly called day programs?

MS CUDDIHY:  That would be     yes.

MS EASTMAN:  Are all of the community services described in paragraph 9(b) in effect day programs? 

MS CUDDIHY:  Yes, but we     I think the day program concept was more or less a 9.00 to 3.00 concept, where what we are trying to do is offer services at different  
times of the day, in the evening, for different age cohorts and tailor those services to the likes and dislikes of the participants. 

MS EASTMAN:  Looking back at the 215 residents in the 48 homes, are any of the 215 residents counted in the 1,192 clients using the community services hub?

MS CUDDIHY:  I believe there would be some of those are clients.  But there would also be clients who utilise other services outside Sunnyfield.  I certainly know that the participant who was in the house subject to this inquiry, who left that house, that participant comes to one of our hubs, although he has now gone to another provider, in terms of accommodation.  So it's really around what the clients and their families would like to choose. 

MS EASTMAN:  But you can't say, of the 215, how many of the 215 residents would also be clients of the day programs or the community services?

MS CUDDIHY:  I don't know exactly.  Also, there would be some of the people who utilise the shared independent living services who also attend Sunnyfield work in the employment services area. 

MS EASTMAN:  That's the next topic. 

MS CUDDIHY:  Sorry. 

MS EASTMAN:  In 9(c) you identify employment services.  So Sunnyfield operates three Australian Disability Enterprises?

MS CUDDIHY:  Yes. 

MS EASTMAN:  The old language for that was sheltered workshop; is that right?  That's not language that we would use any more, but for people to understand.  So with respect to the three ADEs, where are they located and what is the nature of the ADEs that Sunnyfield operates?

MS CUDDIHY:  We have an Australian Disability Enterprise in Mount Druitt, we have one at Chatswood and also one at Allambie Heights. 

MS EASTMAN:  What's the nature of the work performed by the 195 supported employees? 

MS CUDDIHY:  The nature of the work varies at each site.   Sunnyfield has what we would call primary Therapeutic Goods Administration packaging work.  We have secondary Therapeutic Goods Administration packaging work and that's where we have arrangements with some companies that supply over the counter vitamins and minerals and things like that.  We do quite a variety of a range of different work.  And I have to say the employees do a fantastic job. 

 
MS EASTMAN:  Finally, in looking at the services, over the page you say the other services support coordination and implementation of NDIS plans     

MS CUDDIHY:  Yes. 

MS EASTMAN:      for 321 clients, and this has also been an increase of 223 clients over 2020.  So another significant increase in the nature of the services provided; is that right? 

MS CUDDIHY:  Yes.  So we run our support coordination as a separate unit, separate to the other areas of the organisation.  And that is something that when the NDIS came into being, was a new service and so that was an area that we felt that we could offer support and benefit to clients.  So we have quite a number of people who choose Sunnyfield and we assist them in that support coordination process where they choose so. 

MS EASTMAN:  You have told the Royal Commission that Sunnyfield employs over 1,174 staff in New South Wales and the ACT.  If you can, how many of those staff members work for Sunnyfield in the shared independent living in the 48 homes with the 215 residents?  Can you give me that breakdown or not? 

MS CUDDIHY:  I apologise, I do not have that number with me but I could get that information for the Commission.  It would be a large proportion. 

MS EASTMAN:  But that's information that you can provide us with a breakdown of staffing, in terms of how many of the over 1,000 work in the homes?

MS CUDDIHY:  Yes, we could provide that information.

COMMISSIONER McEWIN:  Ms Eastman, before you go further, could I go back to 9(c).  The 195 supported employees, how many of them are included in the 215 residents or are they two separate numbers?

MS CUDDIHY:  There would be some but I can't tell you off the top of my head.  Apologies but I don't exactly know that number right now. 

COMMISSIONER McEWIN:  Yes, I would appreciate that.  Thank you. 

MS EASTMAN:  I'm just conscious of the time.  Before we break, I want to deal with one matter, which is what you set out in paragraph 12 of your statement.  You tell the Royal Commission, "Sunnyfield's priority is and always has been the wellbeing of our clients".  Why use the expression "wellbeing"?  It reflects a very sort of care model, doesn't it? 

MS CUDDIHY:  I think     and it's not meant to be disrespectful to anybody in any shape or form     primarily, as I said before, our clients are people with intellectual disability and I think that we do hold a duty of care quite strong, within Sunnyfield  
and     but that duty of care is not through, you know, undermining people's dignity of risk.  But the organisation does have a very strong human rights based approach to our support of our clients and our goal is to see them being safe, healthy and happy and fulfilled in their lives, the same that we would expect for our parents or our children or for each other. 

MS EASTMAN:  You are aware, aren't you, that there are a number of different theoretical models around disability?  There's a medical model?  You're aware of that? 

MS CUDDIHY:  Yes.

MS EASTMAN:  A social model?

MS CUDDIHY:  Yes. 

MS EASTMAN:  A charitable model?

MS CUDDIHY:  Mm hmm. 

MS EASTMAN: And a rights based model? 

MS CUDDIHY:  Mm hmm. 

MS EASTMAN:  Sunnyfield's history is one of a charitable model with respect to disability.  How do you describe Sunnyfield's approach to disability in terms of models?  Is it still a charitable model?

MS CUDDIHY:  I think our organisation has evolved.  As I said previously, we were great supporters and we still are of the NDIS.  We could see how the previous systems were flawed and I think the organisation has evolved.  I think, you know, it comes from very much the families caring for clients but I think it's very much moved.  And while we may not be perfect, and I'll be very honest to say that, we very strongly uphold the human rights, dignity and respect and people's choice and control.  We don't get that right every day but that's what we aspire to do and we continue to do so. 

MS EASTMAN:  You would accept that language around disability is important?

MS CUDDIHY:  Mm hmm. 

MS EASTMAN:  And language that reflects the values you have just described is important?  And also language that might convey a charity model or a paternalistic model, that would be language you would try to avoid; is that right?

MS CUDDIHY:  Yes.  But, as I said, we don't always get it right. 

 
MS EASTMAN:  Now, you have said in paragraph 12, and you referred to the mission, vision and values.  I will take you to that document perhaps after the break.  You also refer to The Sunnyfield Way, and I want to take you to that document after the break.  You talk in this paragraph about treating all clients as equals and apply person centred support to facilitate and help our clients in achieving their goals, and living positive and beneficial lives. 

Now, in terms of person centred approach, Sunnyfield has a policy that sets that out; is that right?

MS CUDDIHY:  I believe so. 

MS EASTMAN:  If I could ask you to look at hearing bundle B, volume 1, behind tab 13.  Just take a moment to read that to yourself and tell me when you have had a chance to glance at that. 

MS CUDDIHY:  Thank you. 

MS EASTMAN:  So you have signed off on the policy and it has December 2019 as its date. 

MS CUDDIHY:  Yes. 

MS EASTMAN:  Prior to December 2019 did you have a policy in this form before?  Does the person centred active support policy represent a policy that has been in operation since December 2019 but not before? 

MS CUDDIHY:  We have a series of     these are poster policies that are hung up in most of our locations at Sunnyfield.  This is one of those.  Sunnyfield actually has had a very strong person centred active support approach, prior to me becoming CEO.  So I think that Helen Sanderson was one of the champions of person centred and active support approach, and Sunnyfield was one of the early adopters, prior to my employment, and we still continued to have a strong position around this. 

MS EASTMAN:  What was it about preparing this policy, which I assume was undertaken some time before December 2019?  What was the reason for preparing this policy around that time?

MS CUDDIHY:  We actually prepared a whole series of policies, so we refreshed all the     

MS EASTMAN:  Sorry.  We will look at some of the other policies.  I want you to focus on this particular policy, why this policy being developed prior to December 2019?

MS CUDDIHY:  It wasn't particularly singled out as an individual policy to review.

 
MS EASTMAN:  Was it in response to a particular incident or incidents that had occurred?

MS CUDDIHY:  No, it wasn't.  We reviewed every single one of our posters for all of our locations.  The Board had requested that we have longer policies and they had requested, for all of our policies that we put around the organisation as poster policies, that we actually make them more succinct and have them so they are easier to communicate, on our walls.  It wasn't in response of a specific incident.

MS EASTMAN:  With this policy, when you say a poster policy and it's on the walls?

MS CUDDIHY:  Yes.

MS EASTMAN:  Walls of what?

MS CUDDIHY:  In meeting rooms, in each of our community hubs.  This is a policy that is available for staff.  This is one of our core policies at Sunnyfield.

MS EASTMAN:  Is this a policy that is provided to any of the residents of the homes operated by Sunnyfield?

MS CUDDIHY:  I believe it would be.

MS EASTMAN:  Is it in an Easy Read form?

MS CUDDIHY:  I'm not aware of that.  I would have to check.

MS EASTMAN:  Do you know how it is provided to any residents in any of the homes?

MS CUDDIHY:  It's certainly not put up as posters on the wall in any of our homes, that's for sure.

MS EASTMAN:  How would the residents know about this policy?

MS CUDDIHY:  I would need to check on that.

MS EASTMAN:  Is the policy provided to any of the families, guardians or advocates for people who are residents of the homes?

MS CUDDIHY:  I believe this policy is on our website, but I'm not aware that it's particularly mailed to them or distributed in that fashion.

MS EASTMAN:  When you gave evidence earlier about somebody exercising choice and control and perhaps being a new prospective resident, from December 2019 are the new prospective residents provided with a copy of this policy?
 

MS CUDDIHY:  I couldn't answer that question specifically.  There is, I think, a kit when there is a new client, they are provided with information and also a welcome kit, and there is also a pack of information sent to parents, but I couldn't specifically tell you if this was in there.

MS EASTMAN:  Just before we break, is this policy a type of policy that you require all staff to comply with?

MS CUDDIHY:  Yes.

MS EASTMAN:  In terms of complying with this policy, is this a policy that is incorporated into the terms and conditions of an employee's contract of employment?

MS CUDDIHY:  This, I believe, is embedded in our Code of Conduct and our Code of Conduct is part of people's employment contracts.

MS EASTMAN:  Commissioners, if that's a convenient time, it's 10 past 11 and I am trying to stick to the schedule as much as possible, so that we have a 20 minute adjournment now.

CHAIR:  We can.  At the risk of frustrating your timetable and possibly you, I have just a couple of questions I want to ask.

The document Ms Eastman has taken you to, I want to understand your evidence.  Is it your evidence that there was a similar document that was produced by Sunnyfield prior to December 2019?

MS CUDDIHY:  I would believe so.  I would need to check the records.

CHAIR:  You will be able to produce such a document so that we can see what was in existence prior to December 2019?

MS CUDDIHY:  Yes.  I think there would have been a document, yes.

CHAIR:  That's something you can perhaps take on notice.

MS CUDDIHY:  Certainly.

CHAIR:  Something that emerges from some of the questions Ms Eastman asked you, I notice that the revenue for the year ended 30 June 2020 includes sale of goods of $10.5 million.  What goods were sold?

MS CUDDIHY:  That's our employment services area.  We have commercial contracts, as I mentioned, with pharmaceutical companies and other businesses.  So there is revenue that comes in from that and then there is also the cost of goods sold.  So it could be we are fulfilling contracts and that would be that revenue.
 

CHAIR:  I notice from the same report that the cost of goods sold was $3.5 million, so does that mean there was a profit of $7 million?

MS CUDDIHY:  No.  That would be the actual --- any plastic bottles or packaging and things like that.  In addition to that would also be labour.

CHAIR:  Sorry?

MS CUDDIHY:  Would be the cost of labour.

CHAIR:  That cost would be of whose labour?

MS CUDDIHY:  It would be the cost of staff and also supported employees.

CHAIR:  Thank you.  It is now 11.15, so I have taken you three minutes out of your schedule, so we will resume at 11.35.

MS EASTMAN:  Thank you.

ADJOURNED    [11.13 AM]

RESUMED    [11.35 AM]

MS EASTMAN:  Ms Cuddihy, as often happens in a break, I remembered things I need to ask you.  I need you to go back to paragraph 9.  You have identified in paragraph 9 the 195 supported employees in the three ADEs.  Do you remember that?

MS CUDDIHY:  Yes.

MS EASTMAN:  Then I asked you about the number of employees for Sunnyfield generally, so that's the 1,174?

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  I think you are going to give me the breakdown at some point, and it's not urgent, of the number of employees working in the homes?

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  Can I also ask you: with the 195 supported employees who are identified in 9(c), are they included in the count of employees of the 1,174?

 
MS CUDDIHY:  I believe they are not included in that count.

MS EASTMAN:  They are not included?

MS CUDDIHY:  I believe so.

MS EASTMAN:  Why not?

MS CUDDIHY:  They could be, but we felt in this situation, and it wasn't in any way meant to be disrespectful to them, but we thought that would be clearer and not double counting.

MS EASTMAN:  But you don't explain that in paragraph 10, as to whether the 195 supported employees were not included in what is described as 1,174 staff, do you?

MS CUDDIHY:  No.  I believe that that is the case.

MS EASTMAN:  Is the reason you haven't included those 195 supported employees as staff that you really see them as clients more than employees?

MS CUDDIHY:  That could be true.  But they are also paid employees, so I didn't want to, in any shape or form, create an impression that I wasn't providing the correct information.

MS EASTMAN:  Thank you for that.  If you need to clarify that or provide any further information about the status of those 195 supported employees, then I'm happy for you to take that on notice and to give us an update over the next couple of days.

The next topic I want to turn to is to assist the Commissioners to have some understanding of the governance and the senior leadership within Sunnyfield.  That's the next topic I want to turn to.

I want to start with the Board of Sunnyfield.  You have described in paragraph 13 of the statement that the Board of Sunnyfield are volunteers and they are not remunerated.  Then, to understand a bit more about the board, we need to then turn to page 76.

CHAIR:  Of?

MS EASTMAN:  Ms Cuddihy's statement.

CHAIR:  Okay.

MS CUDDIHY:  My apologies.  I don't have the same numbering system because my statement is in larger font to help me with my eyesight.

 
MS EASTMAN:  Would paragraphs help?

MS CUDDIHY:  Yes, please.  Thank you kindly.

MS EASTMAN:  Paragraph 336.  The Commissioners' version and those with the hearing bundle version, it should be page 76, starting at paragraph 336.  You tell the Royal Commission that the board is ultimately responsible for overseeing and monitoring the direction of the organisation.

MS CUDDIHY:  Yes.

MS EASTMAN:  And you say:

Sunnyfield was also one of the first disability service providers to require member representation on the Board.

That's a provision of the constitution that we looked at earlier; is that right?

MS CUDDIHY:  That's my understanding.

MS EASTMAN:  In terms of the board's responsibilities, there is a charter that sets out the board's responsibilities; is that right?

MS CUDDIHY:  Yes.  It's a governance charter.

MS EASTMAN:  In terms of what the governance charter says, if you turn to paragraph 369 at page 86, is that the board charter that you have reproduced in that paragraph?

MS CUDDIHY:  I don't believe it is the full charter but I believe it is an excerpt from the charter.

MS EASTMAN:  If I have overlooked this, please let me know, but I don't think I have seen a board charter in the documents that you have included in your statement.  You have referred to the charter at paragraphs 369 and 370, but you have not annexed or included a copy of the charter.  Is there a document that sets out a charter?

MS CUDDIHY:  There is a document.  That document is under review.  It has been since last year.  The charter is quite an older document now and we have commissioned someone to assist with changing the charter, particularly in light of a principle based governance model.

MS EASTMAN:  Is that why you have not included a charter, because it is under review?

MS CUDDIHY:  Not particularly.  But if you would like the charter, you are  
welcome to have a copy of that.

MS EASTMAN:  Can I ask you, while we are on the topic, the charter is being reviewed?

MS CUDDIHY:  It is.

MS EASTMAN:  What was the reason for the review of the charter?

MS CUDDIHY:  Because, as I stated, the charter is --- my understanding is I think it's some 10 years old now.  It has been reviewed in the 10 years, but I think that modern governance thinking is to move towards a more principle based approach to governance.  So we have a particular person and a committee of the Board who is reviewing the charter and making recommendations to the Board for their future consideration to change that document.

MS EASTMAN:  Who is assisting you with that task?

MS CUDDIHY:  We have a particular gentleman, his name is David Purdue, he's an experienced company secretary.

MS EASTMAN:  How many members of the board serve on the Sunnyfield Board?

MS CUDDIHY:  The constitution allows for 10.  I believe at the moment there are nine.

MS EASTMAN:  To assist the Commissioners to understand a little bit about the directors and who sits on the Board, can I ask you to look at hearing bundle B, volume 1, behind tab 6.  You will see this is the "Sunnyfield and its controlled entities", "General Purpose (RDR) report for the year ended 30 June 2020".  Do you see that?  That's on the front page.  Ms Cuddihy?

MS CUDDIHY:  Yes.  My apologies.

MS EASTMAN:  That's the front page?

MS CUDDIHY:  Yes.  The review is on page 3 of that report.

MS EASTMAN:  If we turn to page 3, this sets out the directors and it describes the directors' qualifications, experience and special responsibilities?

MS CUDDIHY:  Correct.

MS EASTMAN:  I'm not going to trouble you or the Commissioners in going through each of the directors.  But does the document accurately describe each of the directors in terms of their professional backgrounds and experience?

 
MS CUDDIHY:  Yes.

MS EASTMAN:  I assume you're familiar with this document?

MS CUDDIHY:  Yes.

MS EASTMAN:  Who is the director who is the member representative on the Board?

MS CUDDIHY:  We have a number of member representatives.

MS EASTMAN:  Who are they?

MS CUDDIHY:  Mr Michael Brent.  He has a daughter who lives in shared independent living.

MS EASTMAN:  With Sunnyfield?

MS CUDDIHY:  With Sunnyfield.  Dr John Carter.  I'm not sure at the time of this particular report whether his daughter lived with Sunnyfield, but subsequently she has moved into our services.

MS EASTMAN:  He resigned as a director on 23 April 2020?

MS CUDDIHY:  He retired, that's correct.

MS EASTMAN:  Your note says resigned but he retired, did he?

MS CUDDIHY:  Yes.

MS EASTMAN:  So he was at the time a member ---

MS CUDDIHY:  Correct.

MS EASTMAN:  --- with a family member?

MS CUDDIHY:  Yes.

MS EASTMAN:  Anyone else?

MS CUDDIHY:  Miss Melissa Hammel.  She is a descendant of the founders of Sunnyfield, which is our patron, Brian Whiddon.  The Whiddon family were part of the original group of families who started Sunnyfield and the patron, Brian Whiddon, his brother Trevor was a resident of Sunnyfield for a long period of time.  Melissa is the daughter of Brian Whiddon.

MS EASTMAN:  There is a Chair of the Board?
 

MS CUDDIHY:  Sorry, I haven't finished.

MS EASTMAN:  Are there still more members?

MS CUDDIHY:  Yes, there is.  Heather Milnes, she has recently retired from the Board but her sister is also a resident of the shared living services, and Mr Mike Nicholls has a daughter with disability who has been attending some of our community services.

MS EASTMAN:  Who is the Chair of the Board?

MS CUDDIHY:   The Chair of the Board is Karen Ingram.

MS EASTMAN:  It describes her being appointed to the Board from 17 March 2014.  That's on page 4.

MS CUDDIHY:  Yes.

MS EASTMAN:  To the best of your knowledge, has she been on the Board continuously since that time?

MS CUDDIHY:  Yes.

MS EASTMAN:  She is described as a partner of Clayton Utz?

MS CUDDIHY:  Correct.

MS EASTMAN:  Looking at all of the directors, am I right in understanding that none of the directors are people with intellectual disability?

MS CUDDIHY:  That is correct.  Sorry, I've also missed out our new director, Ms Vivian Quinn.  I believe that she also had a relative who received services from Sunnyfield.

MS EASTMAN:  None of the members of the Board are people with intellectual disability?

MS CUDDIHY:  Yes, that's my understanding.

MS EASTMAN:  None of the members of the Board are people who receive any services from Sunnyfield?

MS CUDDIHY:  Themselves, individually, no.

MS EASTMAN:  Looking at the constitution, which we touched on earlier, would you     and if you need to go back to the document let me know, but I just want to  
put this proposition to you.  There is no requirement in the constitution for the Board to have a representative of the residents or the recipients of services on the Board; is that right?

MS CUDDIHY:  Yes, there's no director representation directly of a person with a disability.  Sunnyfield's constitution is set up specifically for people with an intellectual disability and the membership is the representation of     the families are the representation of the clients.

MS EASTMAN:  So it depends on a family member.  You're assuming that the family member who is a member is the representative of the person with disability?

MS CUDDIHY:  I'm not assuming that, that's what I believe is in the constitution.  Any person who is a family member or a carer or guardian of one of our clients is able to apply for membership.

MS EASTMAN:  Why is it that there are no directors who are people with intellectual disability or people who are recipients of the services of Sunnyfield?

MS CUDDIHY:  Because that's the way the constitution was set up.

MS EASTMAN:  When was the constitution set up?

MS CUDDIHY:  Oh, gosh, I would imagine the original constitution goes back to the 1950s, but it has been updated.

MS EASTMAN:  The document we looked at a little earlier was updated, I think, as until late 2018.

MS CUDDIHY:  Yes.

MS EASTMAN:  Has there ever been any consideration in amending the constitution to provide for representation on the Board of a person with disability, be it intellectual disability, or a person who receives services from Sunnyfield?

MS CUDDIHY:  Not to my knowledge.

MS EASTMAN:  No consideration of that at all?

MS CUDDIHY:  Not to my knowledge, no.  I think that --- the majority of our clients, I would think nearly all of our clients, are people with intellectual disability and there would be legal matters to do with consent and capacity in terms of governance roles.

MS EASTMAN:  Is that the reason?

MS CUDDIHY:  I could only postulate that.
 

MS EASTMAN:  You are the CEO and I accept --- are you an ex officio member of the Board?

MS CUDDIHY:  No, I'm not a director.  No paid employees of Sunnyfield, in the constitution, are allowed to be directors or on the Board at all.

MS EASTMAN:  As I said earlier, I'll come to your specific role.  But you report to the Board; is that right?

MS CUDDIHY:  That is correct.

MS EASTMAN:  Are you aware as to whether any member of the Board has worked directly in disability services, either for Sunnyfield or any other private provider?

MS CUDDIHY:  Yes, I am.

MS EASTMAN:  Who has worked in the disability service area?

MS CUDDIHY:  Melissa Hammel.

MS EASTMAN:  Anyone else?

MS CUDDIHY:  Not to my knowledge.

MS EASTMAN:  Melissa Hammel is, I think you said, the descendant of the founders of Sunnyfield?

MS CUDDIHY:  That's correct.

MS EASTMAN:  So only one of the directors has worked in the provision of disability services; is that right?

MS CUDDIHY:  I believe that is the case.

MS EASTMAN:  Do you know, and the answer to this might be obvious, have any of the directors ever worked in a group home or in shared independent living settings?

MS CUDDIHY:  My understanding is a number of directors have relatives and they have worked very closely and been volunteers in Sunnyfield's past, in terms of shared living homes.  I certainly also would believe that Melissa Hammel would have an understanding about shared living homes.

MS EASTMAN:  Looking at these directors, do you know if any of them have ever worked as disability support workers?

 
MS CUDDIHY:  Not to my knowledge.

MS EASTMAN:  Is it the case that there is no representation on the Board of the employees and, specifically, those who might be working in a residential setting?  There's no representation on the Board of disability support workers; do you agree with that?

MS CUDDIHY:  In terms of them, themselves, having done that role in their previous careers, not to my knowledge.

MS EASTMAN:  To your knowledge, is there anything in the constitution that would prevent a current or recent employee who works in one of the 48 homes being a member of the Board?

MS CUDDIHY:  I don't believe any paid employee of Sunnyfield can be on the Board.

CHAIR:  That's clause 17.2 of the constitution?

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  What about a past employee?

MS CUDDIHY:  I think that's a possibility.

MS EASTMAN:  Looking at each of the directors, are you able to say whether --- and if you don't know, please tell me --- any of the directors have had firsthand experience in addressing violence, abuse, neglect or exploitation of people with disability in the roles they hold in their professional lives?

MS CUDDIHY:  I really wouldn't know, I apologise, but I can't answer that question, I don't know.

MS EASTMAN:  Do you accept that the residents and the people who receive services from Sunnyfield should expect that the directors do have some experience in violence, abuse, neglect and exploitation of people with disability, to enable them to perform their roles as directors?

MS CUDDIHY:  I think that would be very helpful and I think also for all of the executive to have experience with that as well.

MS EASTMAN:  But that's not presently the case; is that right?

MS CUDDIHY:  Not to my knowledge.

MS EASTMAN:  Is there a requirement for any of the Board members to spend any time in the performance of their duties either at the 48 homes, the hubs or the ADEs?
 

MS CUDDIHY:  There is a program that was put in place, or a proposal that was put in place, to the Board.  So some Board members, yes, have visited our services.  There was a program put in place in late 2019 but, unfortunately, due to COVID 19 in 2020, I don't believe that was able to be enacted at the time.

MS EASTMAN:  If that was the case, would there be a record of which directors spent time in the various service areas, and that would be part of the Board records?

MS CUDDIHY:  I'm not aware of such records.  I certainly know that all directors have an orientation to Sunnyfield and in their orientation, a day with Sunnyfield, they would go and visit our shared living homes and also our community hub.  There have been, on occasions, board meetings at locations within Sunnyfield and there have been, from time to time, directors visit various sites, as well as the directors who would understand the specific services that their relative with disability receives, and they would be a part of understanding those services.

MS EASTMAN:  Do the Board members hold any meetings with any of the 215 residents from time to time?

MS CUDDIHY:  The Board directors have attended functions where there have been our clients and they have attended those and they are always welcome to come and visit any of our facilities.

MS EASTMAN:  It's one thing to attend a function, but what I was asking you about was meetings.  Meetings, not functions.  Do the Board members hold any meetings with the residents of the homes?

MS CUDDIHY:  I can't specifically recall.

MS EASTMAN:  Do you have any knowledge of there being any process for the Board members to set up meetings with any of the residents from the homes?

MS CUDDIHY:  Not to my knowledge, but there certainly was a process set up for directors to be able to go and visit our services.  As I mentioned, that was set up in late 2019 but COVID 19, unfortunately, interrupted that.

MS EASTMAN:  With respect to family members, is there any process for the Board members to meet with the families of the residents through any sort of formal or organised meetings?

MS CUDDIHY:  Yes, certainly, at the annual general meeting every year, which is held in October.  The only time that hasn't been held in person was in October 2020, but in all other occasions, that has been the case.  Also, directors do come and meet with families and members at various functions and have the opportunity to speak with our clients and with family members.

 
MS EASTMAN:  An AGM is a fairly formal meeting, isn't it?

MS CUDDIHY:  Our AGM has a formal component but it also has all of the awards for supported employees and staff and is actually quite a social function at the beginning, and we have refreshments and a really great opportunity to talk at the end of that meeting.

MS EASTMAN:  But is there a way in which either the residents or their family members can have direct contact with any of the Board members about any concerns they may have?  Can they go directly to a Board member?

MS CUDDIHY:  They certainly can.

MS EASTMAN:  How would they do that?

MS CUDDIHY:  They could request that through our complaints system.  They could request it directly of a director.  If that's what they requested, we would honour that request.

MS EASTMAN:  You say in paragraph 337 on page 76 of your statement:

The Board does not have operational day to day responsibility but the Board's responsibility includes approval of key policies relating to, and oversight of reporting in respect of, Sunnyfield's organisational processes for prevention, identification, reporting, investigation and response to violence against and/or abuse, neglect and/or exploitation of disability service users.

You say that?

MS CUDDIHY:  Yes.

MS EASTMAN:  How can you be confident that the Board can discharge its responsibilities to approve key policies concerning violence, abuse, neglect and exploitation if, to the best of your knowledge, none of the directors have had any experience with respect to violence, abuse, neglect and exploitation?

MS CUDDIHY:  All of the directors have completed the NDIS orientation module.  All of the directors, from my understanding, take it very seriously about their duties.  Our Board actually requested that in addition to --- prior to the new NDIS employment checking process that was introduced this year in February, but prior to that, we would have a police check and a working with children check.  My understanding is directors also have attended --- some directors have attended NDIS forums, various other educational programs and also listened very closely to our director, Melissa Hammel, who has quite a depth of experience in these matters, and take these duties very seriously.

MS EASTMAN:  You are confident that that's sufficient for the directors to be able  
to discharge their responsibilities in approving policies directed to violence, abuse, neglect and exploitation?

MS CUDDIHY:  Sunnyfield has a very strong continuous improvement philosophy.  Needless to say, the matters that happened at the house that is the subject of this Commission's inquiry caused grave concern for the organisation and we would certainly never ever want that to ever happen again, and so we are always open to how we can improve what we do.

MS EASTMAN:  It's one thing, isn't it, to say we don't want that to happen again, but isn't the key that you have a Board that can discharge its responsibilities, not to act after the event but to have prevented violence, abuse, neglect and exploitation?  Would you agree?

MS CUDDIHY:  I would agree that everyone at Sunnyfield who is aware of this matter would be absolutely committed that we never have a case or incidence like this and that we prevent this ever happening again.

MS EASTMAN:  How can you be certain that the present composition of the Board, with the experience described in the report, is the right mix of skills and experience to address violence, abuse, neglect and exploitation of people with disability?

MS CUDDIHY:  I think the Board have a very professional approach, they are very, very strong in their governance, they are also very strong in their commitment to learning.  They have been involved in looking at our risk framework and our risk appetite statement and, like myself, they continue to learn in an area that's quite complex, and we are very open as a whole organisation to ensure these matters never happen again and learn from this.

MS EASTMAN:  But we are talking about a cohort of people for whom there may not be a second chance.  Unless the Board can discharge its responsibilities in relation to violence, abuse, neglect and exploitation with the expectation that it will not occur, as opposed to what will happen when it does occur, how can you be confident that this Board has the right mix of skills?

MS CUDDIHY:  Still, my answer is there.  I think the Board are extremely professional.  I think that they are very, very open to learning.  I hold myself to account for these matters as well and I think that management and the Board share a joint responsibility but, at the same time, also have an extremely strong commitment to try and prevent and to be proactive in preventing this from happening again.  So the learnings from the Royal Commission, the learnings that we can have from this particular situation, the learnings we can have from the sector and from people with disability, all of the learnings are very important to us and I believe that the Board is very positive in embracing those learnings.

MS EASTMAN:  Would you agree with me, looking at the composition of the Board, but for relying on the perspective of those members who have a family  
member with disability, the Board has no firsthand experience or perspective from a person with lived experience of disability.  Do you accept that?

MS CUDDIHY:  I think there is a great diversity on the Board.  There are people who have had lived experience.  We have quite significant folk who have been involved in family members.  We have a board which has quite diverse skill sets and they bring different perspectives, and I think they bring different perspectives that really add to a good overall broad approach.  But can we always do things better?  Absolutely.

MS EASTMAN:  Can I turn now to the senior leadership ---

CHAIR:  Sorry, have you finished with the Board?

MS EASTMAN:  Yes, for the time being, yes.

CHAIR:  I think you just said, at least if I understood you correctly, that there are board members or have been board members with lived experience of disability.  Which of the 12 Board members have had lived experience with disability?

MS CUDDIHY:  My apologies if I stated it incorrectly.  I meant that they had a close family relative with a disability.

CHAIR:  I may have misunderstood you.  Thank you for that.  Of the 12 board members, as I understand the descriptions --- and I don't doubt their professionalism, but I think the question is professionalism in what respect.  Nine of the 12 are business people, are they not?

MS CUDDIHY:  They come from all walks of life, actually.

CHAIR:  Do they really?

MS CUDDIHY:  I would need to look at the paper again.

MS EASTMAN:  Do they really come from all walks of life?  Nine of them are involved in business of one kind or another.  There is one practising lawyer, there is Ms Hammel, who is described as a registered nurse and health manager of the Cerebral Palsy Alliance, and there is one professor of medicine who has apparently retired from the board.  It does give the impression, doesn't it, of the board of a commercial organisation?

MS CUDDIHY:  I think that sometimes one's professional qualifications doesn't always outlie other personal interests that people have and also their experience with their own family member.  So each one of us comes with our professional qualifications but some of our lived experiences and our learnt experiences aren't always there.  So whilst we do have a very high calibre board, I also believe that the board has a very strong commitment to our Code of Conduct, they have a very strong  
commitment to the NDIS philosophies.  I think the Board is quite diverse in its nature.  Could we do better as an organisation?  Yes, we could.

CHAIR:  Yes.  I think what we are discussing, though, is how you might do better as an organisation.  Perhaps one further question about this.  Has there ever been, to your knowledge, a member of the Board who can be regarded as an advocate for people with disability?

MS CUDDIHY:  Not to my knowledge.

COMMISSIONER GALBALLY:  I would like to follow up on that question by asking about quite a common approach now to boards of disability services, that you would have a person with a disability who is a leader on your board.  Do you have a person with a disability who is a leader in their community on your Board?

MS CUDDIHY:  No, we don't.

COMMISSIONER GALBALLY:  Thank you.

CHAIR:  Yes, Ms Eastman.

MS EASTMAN:  I know it is slow going.  Bear with me.  We will now look at the senior leadership team.  You are the CEO, so you are the most senior leader in the organisation; is that right?

MS CUDDIHY:  Yes.

MS EASTMAN:  In terms of your role and responsibility, what are your primary responsibilities?

MS CUDDIHY:  As CEO of the organisation, it is to report --- my first and foremost responsibility, and I don't know if you have seen our organisation chart, is the clients and the people that we support and delivering quality, safe services to them is one of our foremost responsibilities.  But, as the CEO of the organisation, it is the oversight of the functions of the organisation and the conduit between the organisation and the Board and to, you know, address the issues and the matters, developing our strategic plans, our business plan, budgets and fair and appropriate reporting to the Board.

MS EASTMAN:  In terms of monitoring your performance, do you have any performance indicators or ---

MS CUDDIHY:  There is a performance appraisal process that the Board is involved in.  That performance appraisal process has a criteria in regards to what is done and how it is done.

MS EASTMAN:  Are there any particular indicators that require your performance to be measured against outcomes concerning complaints?
 

MS CUDDIHY:  We have KPIs that are set.  In addition to our business plan and our budget, there is also key performance indicators that do relate around the quality of services for our clients.

MS EASTMAN:  Do you have a key performance indicator with respect to the person centred policy that we looked at before the break?

MS CUDDIHY:  I'm not specifically aware of one.

MS EASTMAN:  I would appreciate that your day to day role is very busy, but how much of your day to day role involves being on site at any of the 48 homes?

MS CUDDIHY:  I do visit the sites.  Unfortunately, last year during COVID 19 ---

MS EASTMAN:  Can I come back to the question I asked you:  how much of your day to day role requires being on site at any of the 48 homes?

MS CUDDIHY:  I do visits to various sites.  I would most probably get out to do a day visit once a quarter, if not more frequently.

MS EASTMAN:  Once a quarter?

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  If you visit once a quarter, then --- my maths is not great     that means you wouldn't get out to see all of the 48 homes in the course of ---

CHAIR:  Twelve years.

MS EASTMAN:  Would that be right?

MS CUDDIHY:  I wouldn't spend a day in each facility but I do go to have various visits and go to various sites.

MS EASTMAN:  If you are having a visit, what, it would be an hour or so?

MS CUDDIHY:  It would be an hour or two, yes.

MS EASTMAN:  Have you ever spent a whole day in one of the 48 homes ---

MS CUDDIHY:  I wouldn't spend ---

MS EASTMAN:  --- and watched the whole of the day?

MS CUDDIHY:  I haven't spent a whole day but I have spent half a day.

 
MS EASTMAN:  That would be the most time you have spent, half a day?

MS CUDDIHY:  I believe so.

MS EASTMAN:  How often do you organise any meetings or engagement with the residents at the 48 homes?

MS CUDDIHY:  Whenever I go ---

MS EASTMAN:  Is there a forum for them?

MS CUDDIHY:  Whenever I go to the homes, I always do speak with the residents.  That's my first and foremost thing.  I'm very careful about visiting homes because it is actually the clients' home, so that isn't something to be taken lightly, to go and visit their actual home.  I haven't sat down with specific meetings but I have sat down individually with clients and asked them about how they are finding things, any --- and have a conversation with them about the service.

MS EASTMAN:  Do you organise any particular forum for the residents to get together as a group and to engage with you in any way about the nature of the services they receive or any concerns they have about their services?

MS CUDDIHY:  In Shared Living, I haven't specifically done that, but we do have forums from time to time.  We have had forums in our Employment Services area, which I have been to.  We have had meetings in Community Services Hubs.  Generally speaking, if I go to a Shared Living home, there may be residents sitting together.  But by and large, most of those conversations are individual conversations.

MS EASTMAN:  What training have you had specifically in terms of communication with people with intellectual disability, particularly the cohort of the 215 people who live in the shared independent living settings?

MS CUDDIHY:  I have not had any specialised training other than what I've learnt since I have been employed at Sunnyfield.

MS EASTMAN:  No specialised training?

MS CUDDIHY:  No.

MS EASTMAN:  When you say what you have learnt at Sunnyfield, can you assist us in terms of what that learning is with respect to communication?

MS CUDDIHY:  My learning is to be able to sit with someone respectfully, without a lot of noise or interference, to be very understanding.  I do know a lot of the clients at Sunnyfield and they know me.  To sit with them, listen to them.  A number of our clients are nonverbal; to be able to interact with them, to read body language, to be very patient and slow, and take the time to be respectful in what communication they  
may give me.

MS EASTMAN:  This learning has come from the visits you do from each quarter; is that right?

MS CUDDIHY:  I enjoy speaking with residents.  There are clients who also interact at our offices and so I would see clients, various different clients, quite regularly in actual fact.

MS EASTMAN:  Have you had any specific training with respect to violence, abuse, neglect and exploitation of people with disability?

MS CUDDIHY:  Not other than our organisational training.  I have undertaken our organisational training and done that training.  I have also completed the NDIS worker orientation module and also completed the Sunnyfield training.

MS EASTMAN:  Have you had any specific training in trauma informed approaches to interviewing people?

MS CUDDIHY:  No, I have no.

MS EASTMAN:  Have you had any training in trauma informed approaches generally?

MS CUDDIHY:  No, I have not.

MS EASTMAN:  Can I ask you about the rest of the senior leadership team.  You describe the leadership team at paragraph 306 at page 71.  All the members of the senior leadership team are responsible for the oversight of their relevant teams at Sunnyfield?

MS CUDDIHY:  Yes.

MS EASTMAN:  That responsibility includes managing all concerns and processes particular to each team, in order to prevent, detect, respond to any risk of violence, abuse, neglect or exploitation of people with disability.  Just pausing there, in terms of the senior leadership team --- and I assume that includes you ---

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  --- do you know if any members of the senior leadership team have undertaken any specific training with respect to preventing, detecting or responding to the risk of violence, abuse, neglect or exploitation of people with disability?

MS CUDDIHY:  I believe that all of the senior leadership team have completed their NDIS orientation worker module.  They have completed that.  And there will be --- depending on the nature of the person's role, the staff would have all completed our  
internal training processes.  And depending on the particular role of individuals, some of them may have completed more in-depth training.

MS EASTMAN:  To the best of your knowledge, the training of the senior leadership team would reflect the training that you have described you yourself have undertaken; is that right?

MS CUDDIHY:  It may be, and I don't know the answer to the question, that some of the leadership team may have taken further training in some more specific areas, but I couldn't answer that question directly.

MS EASTMAN:  I just want to now turn to who constitutes the senior leadership team, in terms of roles and what their responsibilities are.  At paragraph 306(a) there is:

..... the General Manager Quality, Risk and Compliance .... is responsible for the operation and supervision of Sunnyfield's Complaints and Feedback system, the Response Team (via supervision of the Client Safeguarding Team) and for the conduct of quality audits.

Then the paragraph goes on to describe a little more about the role of General Manager for Quality, Risk and Compliance.  That's just a very high level description.  But if the Royal Commissioners wanted to know what does that person do on a day to day basis, what occupies that person's role, what sorts of issues is the General Manager QRC dealing with, can you help us with that?

MS CUDDIHY:  Yes, certainly.  So that role --- I would like to just explain, that role previously was Company Secretary and Quality, Risk and Compliance and it's only recently been made dedicated to Quality, Risk and Compliance.

MS EASTMAN:  When did that change occur?

MS CUDDIHY:  At the end of January this year.

MS EASTMAN:  Prior to that --- because we have seen in the material, and we will come to that     reference has been made to Jonathan Swain.

MS CUDDIHY:  Yes.

MS EASTMAN:  He was the Company Secretary?

MS CUDDIHY:  But he was also in charge of Quality, Risk and Compliance.

MS EASTMAN:  And ---

MS CUDDIHY:  He was Company Secretary and, I think, General Manager of Corporate, and Corporate was the Quality, Risk and Compliance team.
 

MS EASTMAN:  I'll deal with this now.  Because he features in some of the documents I will need to take you to later, what were his particular qualifications and his professional background?

MS CUDDIHY:  His professional background for Jonathan Swain was he's a lawyer.

MS EASTMAN:  A lawyer.  Do you know anything about where he's worked as a lawyer?

MS CUDDIHY:  I understand he previously worked at Clayton Utz and some other law firms.

MS EASTMAN:  When you say a lawyer --- again, if you don't know, that's fine     how much seniority did he have?

MS CUDDIHY:  I'm sorry ---

MS EASTMAN:  Was he a very experienced lawyer of 30 years or a fairly new lawyer?

MS CUDDIHY:  I don't believe he was a junior lawyer but, I'm sorry, I don't fully understand the hierarchy of the legal system.  My apologies.

MS EASTMAN:  You might not be the only one.  Did you recruit him?

MS CUDDIHY:  Yes.

MS EASTMAN:  What were the particular skills or qualifications that he had that you thought he was appropriate for this type of job?

MS CUDDIHY:  He was an extremely professional person of great integrity, he had the legal background, he had been experienced as a company secretary.  He also had a very impartial and integrity approach to oversight of the quality assurance function, the risk management function, and our compliance function.

CHAIR:  When was he appointed?

MS CUDDIHY:  I'm sorry, I can't recollect the date.

CHAIR:  Roughly?

MS CUDDIHY:  I do apologise, I can't recollect the date but he was certainly there in 2018.

MS EASTMAN:  Would it help you that he was certainly in the role as at June 2015?

 
MS CUDDIHY:  I could check.  Thank you.

CHAIR:  When you or the organisation appoints somebody to that position, is there a selection committee?

MS CUDDIHY:  Absolutely, yes.  All senior leadership team positions will involve our General Manager of People, Learning and Culture, or human resources.  It also involves a committee of the Board.

CHAIR:  Who on the Board was on the selection committee that appointed Mr Swain?

MS CUDDIHY:  I can't recall specifically.  There is usually a small group of people.  It could involve the Chair, it could involve the Chair of the HR Remuneration and Nomination Committee and usually another director as well, but I wouldn't be able to tell you, I'm sorry, right now exactly who was on that committee.

CHAIR:  Thank you.

MS EASTMAN:  Can I ask you about the next member of the senior leadership team, which is, Commissioners, on page 72, paragraph 306(b).  This is the General Manager Shared Living, and that person is responsible for "approving policies, proceedings and work instructions for shared living, appointment of regional managers and service coordinators, supervision of regional managers, closure of Response Team matters, actioning complaints and feedback matters that are not Response Team matters, and coordinating with PLC on staff performance issues".

Pausing there, I am going to ask you some questions later on about the Response Team and the Response Team's particular responsibilities and I am also going to ask you later on about Regional Managers, service coordinators and other employees.  So, against that background, can you tell the Royal Commission what are the day to day responsibilities of the General Manager Shared Living?  What would she do on a day to day basis?

MS CUDDIHY:  Certainly.  The General Manager of Shared Living is part of the senior leadership team, so she's part of the oversight of the whole organisation's review.  But she also specifically is heading up the shared living portfolio and has a very strong focus around the quality of service delivery.

MS EASTMAN:  What does quality of service delivery mean?

MS CUDDIHY:  Quality of service delivery means the fitness for purpose of what the clients are expecting in terms of their NDIS goals, their NDIS plans, their NDIS funding or support or supports, and ensuring that we deliver on that in good faith.

MS EASTMAN:  What are the qualifications that somebody taking the role of General Manager Shared Living should have?
 

MS CUDDIHY:  Well, Jen Luff, who is in that role, who we thought was a very good candidate, and again went through similar processes in terms of recruitment, has an MBA.  She has degree qualifications as well.  And she came from working, I think, from Vision Australia was I think her background, and previously banking, but had moved into the disability sector and has been a very keen advocate but also learning and spent a lot of time learning about the sector and involved in developing her skill set around the supports areas.

MS EASTMAN:  Ms Luff's predecessor was Dr Mark Clayton; is that right?

MS CUDDIHY:  That's correct.

MS EASTMAN:  He held that ---

MS CUDDIHY:  Sorry, there was an interim General Manager, Steven Russell.

MS EASTMAN:  But Dr Clayton was holding this role of General Manager Shared Living in 2017 and around the time of the acquisition of the house in Western Sydney; is that right?

MS CUDDIHY:  Yes.  He did have a role at a point in time, and I can't recollect the exact dates, where he was involved in assisting our organisation transition to the NDIS.  So I'm not entirely clear if he --- he was still a senior leadership team member but he certainly had been for a period of time General Manager of Shared Living.

MS EASTMAN:  I'm just working off the annual financial reports that have been provided to the Royal Commission, that have the different incumbent in these roles.  That suggests that Dr Clayton was in that role as at 30 June 2017.  But by the next year, Jennifer Luff is in that role.  So would that accord with your recollection about Dr Clayton ceasing in the role, the interim person and then Ms Luff then commencing in that role?

MS CUDDIHY: Yes, sounds about right, yes.

MS EASTMAN:  How much of the General Manager Shared Living's role involves direct engagement with any of the say, 215 residents?

MS CUDDIHY:  I believe that she does --- and I would have to talk to her directly, but yes, she does catch up with clients, she catches up with the family members.   She has quite a lot of personal contact with our clients.

MS EASTMAN:  Is she, out of the senior leadership team, the principal point of contact for residents and their families?

MS CUDDIHY:  Yes, that would be correct.

 
MS EASTMAN:  In terms of any correspondence between the families about concerns or issues in the house or from the residents in the house, she would be the primary point of contact?

MS CUDDIHY:  I'm not sure if she would be the first point of contact.  We do have a structure where each house has a service coordinator, then there is a regional who has a number of shared living homes, reporting to the Regional Manager, and then the Regional Managers report to the General Manager.

MS EASTMAN:  If I'm just looking at the senior leadership team, who in that team is the primary point of contact, in the senior leadership team, that would be the General Manager Shared Living?

MS CUDDIHY:  That's correct.

MS EASTMAN:  The next member of the senior leadership team is the General Manager of People, Learning and Culture.  Is that sort of a modern way of saying human resources?

MS CUDDIHY:  That's correct.

MS EASTMAN:  That person is responsible for "approving policies, procedures, work instructions, employment learning and developments, orientation, commissioning independent investigations, and performance management matters, including disciplinary matters, staff suspension or termination (with the approval of the CEO)".

MS CUDDIHY:  Yes, that's correct.

MS EASTMAN:  With respect to this role, essentially this is managing the 1,000 or so staff and also volunteers; is that right?

MS CUDDIHY:  Volunteers may be probity checked through our People, Learning and Culture area, but volunteers by and large work directly through the fundraising area.

MS EASTMAN:  What are the particular skills or qualifications required of a person in this role?

MS CUDDIHY:  A background --- extensive experience and background in human resources.

MS EASTMAN:  Is this the role [Client Safeguarding Manager] holds?

MS CUDDIHY:  No.

MS EASTMAN:  What's her role?
 

MS CUDDIHY:  No.  The incumbent in this role is a lady called Simone Blumberg, but prior to her, a lady called Margaret Loumbos.

MS EASTMAN:  Then there is the General Manager Business Development who, is responsible for the commercial team, who assists clients and customers, if they so choose, to prepare NDIS plan requests, quotes and contractual matters.

Commissioners, that's paragraph 306(d).  Tell us, what does this person in this role do on a day to day basis?  Can you help us with what the commercial team does and how this person assists clients and customers with respect to NDIS plan requests?

MS CUDDIHY:  Certainly.  Previous to the NDIS, this role did not exist.  Since the NDIS, we have in our organisation a centralised team who assist clients where they choose, but also liaise directly with the NDIS, to develop, in shared living particularly, people's requests around the individual clients' roster of care, then compile that for the house roster of care, and assist them in their representations if they wish to the NDIS, and also with plan reviews, any SDA funding, registrations of SDA properties.  There is a significant amount of interaction with the NDIA in terms of supporting a person to have a plan that's suitable to them.  And then once that plan is agreed in dealing with the contractual matters that go with that, and also then once those contracts are agreed to, setting them up in terms of scheduling for clients and then organising them in all of our software systems and our processes, as a client.  That team also has a client engagement team, where we have our business growth and also in that team is a fundraising team, and that particular individual also assists with strategy development.

MS EASTMAN:  How does this person navigate the risk of conflict of interest in the sense that this is Sunnyfield, with a senior leadership team member, who is assisting on NDIS plans?  Is there a risk of conflict in terms of the NDIS participant making her or his own decisions about plans?  How does that work?

MS CUDDIHY:  I don't believe so.  I think at the end of the day that --- and, you know, I suppose there always can be open --- anything can be open to conflict.  But I think that what we're trying to do here, and that's what the team are trying to do, is to be respectful to what each client would like, interpret that, particularly in the shared living scenario, into their individual rosters of support, and help them navigate what is an extremely complex pathway through the NDIS, to get their outcomes they want.  I don't believe that there is a compromise because all of those documents need to be what the client and the family want anyway.  So they do go to great lengths not to do that, and this is actually a service that Sunnyfield provides for people, if they choose, which is not funded.

MS EASTMAN:  That's covering the senior leadership team, which includes you.

MS CUDDIHY:  There are other members of the senior leadership team.

 
MS EASTMAN:  Who else have you not included who are in there?

MS CUDDIHY:  Other members of the senior leadership team includes our General Manager of Community Services.

MS EASTMAN:  Why didn't you include them?

MS CUDDIHY:  I think it was --- I'm not sure why.  But there are other members.

MS EASTMAN:  What does the General Manager of Community Services do?  Are these part of other services like the ADEs?

MS CUDDIHY:  That's correct.

MS EASTMAN:  Is it the case that the senior leadership team you have described in this paragraph is the senior leadership team with respect to Supported Independent Living services?

MS CUDDIHY:  This is the team that are specific to the Royal Commission's inquiries.  But in the senior leadership team, including myself, there is actually 10 people.

CHAIR:  The total remuneration of that team, according to the 2020 report, is $2.3 million.

MS CUDDIHY:  I believe that would be the case.

MS EASTMAN:  Who on this leadership team is the key person for engagement with external regulators, be it the NDIA, the NDIS Quality and Safeguards Commission or the Ombudsman?  Who is the key person?

MS CUDDIHY:  In regard to complaints, it could be through our quality, risk and compliance team.

MS EASTMAN:  If there needs to be any communication with the New South Wales Police or, for the ACT, the Australian Federal Police, who is the primary contact for the police?

MS CUDDIHY:  It would be in the quality, risk and compliance team.

MS EASTMAN:  And who in this senior leadership team has responsibility for drawing up any contracts that Sunnyfield might enter into with its clients?

MS CUDDIHY:  That would be our General Manager of Business Development and Fundraising.

MS EASTMAN:  So General Manager of Business Development and Fundraising is  
also the person with oversight of drawing up any contractual documents for clients entering into Supported Independent Living; is that right?

MS CUDDIHY:  That's correct.

MS EASTMAN:  And who is the person who ultimately has the authority to make decisions to terminate any accommodation or other services between Sunnyfield and the client?

MS CUDDIHY:  Ultimately it would be me.

MS EASTMAN:  You.

MS CUDDIHY:  It is something that we would do very rarely.

MS EASTMAN:  Well, I'll come to how often you have to do it.  But I just wanted to know who is the decision maker.

MS CUDDIHY:  So I'm able to receive a recommendation from senior people and that recommendation would come to me and then I would make that ultimate decision.

MS EASTMAN:  Do any of the members of the senior leadership team have lived experience as people with disability?

MS CUDDIHY:  Not to my knowledge.

MS EASTMAN:  Commissioners, I want to move now to the topic of the financial arrangements for Sunnyfield.  You will be pleased to know that I don't want to spend a long time on this topic and I'm not going to go into this topic in detail, for hours.  But there are a few key points I want to deal with, with are to the financials.

COMMISSIONER GALBALLY:  Just before you do, could I ask a question about training, before we leave that topic, and ask about human rights training around the convention on the rights of people with disabilities?  Do the Board get training on the convention and do the senior staff get training on the convention and have you had training on the convention?

MS CUDDIHY:  Thank you for that question.  Yes, no.  Sorry, not yes, no, that's not a very good answer.  My apologies.  We do have training on the United Nations Convention on the Rights of People with Disability, and that is something that is at the forefront of our Code of Conduct, The Sunnyfield Way and the way in which we approach the rights or our responsibilities towards people with disability.

COMMISSIONER GALBALLY:  Thank you.

CHAIR:  What training is that?
 

MS CUDDIHY:  We have all done the NDIS orientation module but we also have online training modules, we are all taken through in our orientation the United Nations convention.  That's something that I actually present at the orientation, for every staff, I'm at nearly every single orientation for new staff members and I take people through that convention.

MS EASTMAN:  Commissioners, I'm going to deal specifically with the topic of training when I come to the recruitment and terms and conditions of staff.  So I won't forget it and we will come back to this topic.

If I could turn to the financials.  Ms Cuddihy, can I ask you to have a look at the documents in hearing bundle B, volume 1, behind tab 6.  This is the directors' report for year end 30 June 2020, which we looked at earlier.  I would like you to turn to page 2 of that document.

MS EASTMAN:  Just read that to yourself and tell me when you have done that, before I ask you any questions.

MS CUDDIHY:  May I clarify, is that on the bottom of page 2?

MS EASTMAN:  The bottom of page 2, which is the key financial outcomes, I do want to take you to that.

MS CUDDIHY:  Thank you.

MS EASTMAN:  There are a few matters, though, that I want to ask you, just to understand    

CHAIR: I think Ms Cuddihy was just wanting to know if she was on the right page.  Page 2.

MS CUDDIHY:  Yes.  Thank you kindly.

MS EASTMAN:  In terms of this directors' report, this report identifies some notable areas that have had an impact on Sunnyfield's performance.  Do you see that?

MS CUDDIHY:  Yes.

MS EASTMAN:  And if I can summarise this way, one of the significant impacts has been the impact of COVID 19 on the provision of services.  Is that right?

MS CUDDIHY:  Yes.

MS EASTMAN:  And Sunnyfield qualified for the Australian Government's JobKeeper wage subsidy from April to September 2020; is that right? 

 
MS CUDDIHY:  That's my understanding.

MS EASTMAN:  You say in this report that this resulted in Sunnyfield keeping 960 eligible staff employed during the April to June period, with $8.67 million of government wage subsidy, and that's reported in the financial accounts as "Other income." Is that right?

MS CUDDIHY:  That's correct.

MS EASTMAN:  If we look at 960 eligible staff out of the 1,170 staff, that points to the majority of the staff being supported on the JobKeeper wage subsidy during that period from April to September last year; is that right?

MS CUDDIHY:  There is a number of criteria for JobKeeper.  One, it related, I understood, to do with the organisational impact on the revenue.  When COVID 19 became apparent in particularly, I think, late March 2020, that was very disconcerting, I believe, for the whole sector, as it was our whole community.  So there were a number of clients that did not want to receive services, particularly community services clients and employment services clients.  We took the policy at Sunnyfield that we would continue our services wherever it was safe to do so, so we did not close our programs but we instituted all of the Department of Health protocols.  But some people also quite rightly chose not to attend those services, and it did impact our revenue and Sunnyfield was able to become eligible for JobKeeper.  But individual employees also had to register to be eligible for JobKeeper and that was a separate registration, is my understanding, for each employee.

MS EASTMAN:  With respect to the employees who were on the JobKeeper arrangements, did that have any impact on the staffing of the 48 homes?

MS CUDDIHY:  We did have quite a significant change to rosters.  There were a lot of our clients who were unable to continue to go to their day programs, specifically external day programs, but also at times our own day programs.  They may not have wanted to and they may not have wanted to go to employment services.  So what we were able to do was our staff were very flexible and agreed that they would --- people who normally wouldn't work in our shared living homes, they basically took the services that they would have had in the day programs to the homes, where that was agreeable with the families, and we were able to offer quite a lot of different activities and diversional therapies in the homes, with the staff who normally would have worked in the hubs.  We also really made it available, where it was safe to do so of course, all of the community in home supports, where people were concerned about coming to programs, and particularly I think transport also was a concern for people, we provided services into people's own homes.  So the staff really did adapt flexibly, but that took some time, and not everybody wanted to take up that option.

MS EASTMAN:  Also, it notes some arrangements in relation to properties at Allambie Heights and that the arrangements in relation to those properties and transfers have had a bearing on the financial reporting for Sunnyfield for that year; is  
that right?

MS CUDDIHY:  Yes.

MS EASTMAN:  I have tried to summarise it.

MS CUDDIHY:  That was a very significant factor for the organisation and a project the organisation has been working on for some 10 years.

MS EASTMAN:  Let's go to the key financial outcomes for the year ended 30 June 2020.  So the revenue increased by 22.8 per cent and the revenue for that financial year is $110.4 million.  Is that right?

MS CUDDIHY:  Yes.

MS EASTMAN:  What is the explanation for the revenue increase?  And again, if you need to look at the more detailed breakdown, which appears later in this report, let me know, we can go to that.

MS CUDDIHY:  Yes, I would like to do that.  Thank you.

MS EASTMAN:  If we go to revenue and expenses, at page 29, this is where the notes to the consolidated financial statements appear.  Does that assist you in assisting the Royal Commission with respect to the increase by 22.8 per cent in revenue in that year?

MS CUDDIHY:  You are looking at page 29?

MS EASTMAN:  Page 29, if that assists you.

MS CUDDIHY:  Yes, to compare 2020 with 2019.  You would like me to detail those increases?

MS EASTMAN:  I don't need you to walk us through the detail on that page, in terms of each of the line items, but generally, looking at that page, does that assist you, just in a short way, to explain to the Royal Commissioners the increase in the revenue, that it was up by 22.8 per cent?  What's the source of it?  Is it receipts from NDIS, is it sale of property, is it fundraising?  There's a range of items there.  What accounts for that increase?

MS CUDDIHY: It depends whether it's operating revenue or whether it's consolidated revenue.  My understanding is operating revenue is $110 million, of that, approximately $87 million was from the NDIS.  We also received some government subsidies.  They particularly were $6.2 million of government subsidies and a lot of those subsidies relate to people who were over the age of 65 when the NDIS came in, I think it was called the continuity of supports program and it has recently changed its name.  There was a small amount of funding from FACS.   
Employment services, who as we spoke about before, sell goods, a lot of Therapeutic Goods Administration, primary and secondary goods.  That was $10.5 million.  There was client board and lodging fees of $4.3 million.  Fundraising was around $744,000.  There was fee for service management fees and some other fees.  So that made up $110 million operating revenue.

CHAIR:  It's pretty obvious that the major sources of the increase of $21 million, more or less, in revenue, comes from the NDIS, which was an increase of $16.4 million or thereabouts, and the sale of goods, which increased by $3.6 million.  That's the bulk of it, isn't it?

MS CUDDIHY:  Yes.

MS EASTMAN:  I don't want to confuse you.  But it might also be helpful to look at the summary version, which appears in the annual report for 2020, Commissioners.  This is behind tab 2 in the same volume.  You might need to keep both of those open.  If I take you to tab 2, this is the annual report.

MS CUDDIHY:  Yes.

MS EASTMAN:  On page 5, there is a message from you, "A message from the CEO".  Do you see that?

MS CUDDIHY:  Yes.

MS EASTMAN:  In that first paragraph, you say in your report:

In the last financial year, clients served at Sunnyfield grew in number by 15% and consolidated revenue increased to $1010 million with a good surplus.

MS CUDDIHY:  Yes.

MS EASTMAN:  Then:

We increased our net assets to $67.6 million for the sole purpose of future proofing Sunnyfield for the current and future clients and families we serve.

MS CUDDIHY:  That's correct.

MS EASTMAN:  That's a shorthand description?

MS CUDDIHY:  Yes.

MS EASTMAN:  Then if we go to page 15 of the annual report, there are some photographs of the Board members and the senior leadership team; is that right?

 
MS CUDDIHY:  Yes.

MS EASTMAN:  And then, on the right hand side, there's some pie charts.

MS CUDDIHY:  Yes.  In terms of looking at the financial year for 2020 revenue, there's a piechart there.  I don't know whether yours is in colour.

MS CUDDIHY:  No.

MS EASTMAN:  I don't know, Ms Cuddihy, can you see a screen next to you that has the piechart expanded?

MS CUDDIHY: Yes, thank you.

MS EASTMAN:  Does that help colour wise?

MS CUDDIHY:  Yes, thank you.

MS EASTMAN:  I raised this with you a little earlier, in terms of the almost 50 per cent of revenue coming from shared living.

MS CUDDIHY:  Yes.

MS EASTMAN:  In terms of breaking down the sources of revenue, does this piechart help summarise what is the more detailed accounting style records that are in the financial reports?

MS CUDDIHY: Yes, they are in the summary.

MS EASTMAN:  Are you comfortable working with the piechart?

MS CUDDIHY: Yes, thank you kindly.

MS EASTMAN:  The Chair asked you about NDIS revenue.

MS CUDDIHY:  Yes.

MS EASTMAN:  That accounts for the 47 per cent; is that right?

MS CUDDIHY:  No, no.  The shared living    

MS EASTMAN:  The shared living level.

MS CUDDIHY:  We have NDIS revenue for shared living clients, community service clients, our employment services clients, and also our support coordination clients.  So all of those clients would receive NDIS funding.

 
MS EASTMAN:  Could I put it this way     and tell me if I'm wrong     if you excluded fundraising the 1 per cent and property of 5 per cent, is the balance of the revenue NDIS funding?

MS CUDDIHY:  There is also some client fees and there is also, as we mentioned --- so the NDIS funding is $87 million of the $110 million.

MS EASTMAN:  In terms of the increase of 15 per cent of clients over the COVID period, last year, where are those 15 per cent primarily coming?  Is it in shared living or is it in community service or the ADE.

MS CUDDIHY: My understanding is --- and I need to double check my dates --- my recollection is that it is community services.  There was an organisation in the Hunter region, called school Endeavour Hunter, that became insolvent and administrators were appointed and Sunnyfield evaluated that situation and we were very, very concerned about the communities in the Hunter and we actually did acquire that business.  And I need to know the exact year, but that would have, I think, contributed to the growth because following our taking over that business that was --- if we hadn't have taken it over, it would have closed, which was very unfortunate because it was insolvent, but since we have taken over that business and worked with the staff in all of those areas and directly with the clients, that business has grown quite significantly.

MS EASTMAN: Is another source of revenue you receive from the residents, whether it is 215 or thereabouts, in the 48 homes, that you also receive rent from a deduction to they are Disability Support Pensions?

MS CUDDIHY:  The client board and lodging fees for shared living were $4.3 million of the $110 million, and that's in our statutory accounts.

MS EASTMAN:  You have mentioned in the annual report a surplus.

MS CUDDIHY:  Yes.

MS EASTMAN:  If we go back to the document behind tab 6, which is the directors' report, back at page 2, at the bottom of the page where the dot points are, you identify an operating surplus and an overall surplus.

MS CUDDIHY:  Correct.

MS EASTMAN:  So the operating surplus increased by $6.2 million.

MS CUDDIHY: Yes.

MS EASTMAN:  And the overall surplus was $28.3 million.

MS CUDDIHY:  Yes.
 

MS EASTMAN:  That was quite a significant increase in the over surplus, compared to 2019, when the surplus was $3.7 million.

MS CUDDIHY:  Yes.

MS EASTMAN:  Is this right, what accounts for the $28.3 million surplus is the transfer of the land?

MS CUDDIHY:  Yes.

MS EASTMAN:  And the JobKeeper wage subsidies; is that right?

MS CUDDIHY:  And a small amount of interest.

MS EASTMAN:  And it is the case, isn't it, that Sunnyfield's financial position was strengthened further with an increase of total assets, and it is described here as the total assets being $113.1 million, and that was an increase from the previous financial year, where the asset base was $61.4 million.  Is that right?

CHAIR:  They are the gross assets.  The net assets ---

MS EASTMAN:  And the net assets are $67.6 million.

MS CUDDIHY:  Yes, the net tangible assets of Sunnyfield as at the end of the year were $67.6 million.  That includes property.  And then the rest of it would be primarily cash.

CHAIR:  It was $29 million cash.

MS CUDDIHY:  Right.

MS EASTMAN:  So from a financial perspective, is it your view that Sunnyfield is financially sound?

MS CUDDIHY: Yes, it is financially sound.  The organisation has been building its reserves and the reason why it has been building its reserves is twofold: one is to invest in new computer systems, that enable the workforce to undertake the significant administrative duties of the NDIS and be able to do them more efficiently, because we are very, very keen to reduce admin and to be able to support the clients, to spend less time on administration.  And the other major reason why the organisation has been --- there's really three --- why we have been building our reserves is that we have very, very outdated facilities and those facilities are from the 1960s, and we have a commitment to government to replace those facilities, that relates to the property transfer and we have made that commitment.  It isn't showing as a liability in our balance sheet, our auditors weren't sure how that should be represented, and that was the conclusion.  But we have a very strong commitment to  
government to do that.  And the third reason is so that we can hopefully purchase more facilities, invest in our facilities, update some of our outdated facilities, invest in more skills for life programs, and so on.  So there is a particular purpose, while gradually over the last 10 years the organisation has tried to build up its balance sheet for investment purposes back into the organisation.

MS EASTMAN:  I'm conscious of the time.  The last question I want to ask you before lunch, and if you can't answer it then we can come back to it after lunch.  When we have read through the statements that you have provided to the Royal Commission, there are a number of references to matters being unfunded and funded, in terms of both the provision of services and Sunnyfield having to make, for example, repairs to property.  What is the point of identifying funded and funded services in your statement and how does that have a bearing in terms of the overall financial circumstances of Sunnyfield?  I'm asking you this because I may be wrong in the impression that I've gained from reading your statements, but the impression one is left with is that there is a resistance to take on the funding of these areas that you call unfunded.  And I'm trying to understand from a financial perspective, is that because it poses financial risk to Sunnyfield or is there some other reason behind that?

MS CUDDIHY: Sorry, I don't quite understand the question.

MS EASTMAN:  Alright.  I might come back to it after lunch.  But my question is really directed to a reading of the whole of your statement and the many places where you make distinctions between unfunded and funded services for the clients.  I want to understand, what is the importance of making that distinction of funded and unfunded.  Is it because there is a reluctance of Sunnyfield to have to provide services that are unfunded and, if that is so, is the reason for that a concern about its impact on Sunnyfield's overall financial position?  And you are very welcome to have a think about that and we will come back to that after lunch.

MS CUDDIHY:  Would you like me to answer that now?

MS EASTMAN:  If you can answer now, that would be good, and I will come to a different topic after lunch.

MS CUDDIHY:  I don't want to water the time of the Commission.  There are areas that the NDIS does provide funding for but there are areas that it does not provide funding for, and Sunnyfield is just aware of what those areas are.  Yes, we do need to be financial good stewards and we want the organisation to be around for another 70 years, but we are just aware as an organisation we do provide a lot of unfunded services and we are aware of those, and we do them willingly and obligingly, as with helping clients with their NDIS planning, as it is very complicated and onerous, but as an organisation, we just are aware of that.  It's not because we don't want to be generous in any shape or form, it's just is that we also meet our financial stewardship obligations.

 
MS EASTMAN:  Commissioners, if that's convenient, I'm going to leave the topic of finances at this point, so if the Commissioners have any questions about financial questions, it may be convenient to deal with those questions now.

CHAIR:  Alastair, any questions?

COMMISSIONER McEWIN:  No.

CHAIR:  Commissioner Galbally, any questions?

COMMISSIONER GALBALLY:  I guess that last answer, it would be good to know what sorts of things you feel that some of that reserve could be applied for, for the current residents, so that they could have a better quality of life.  There is the question of how much reserve a not for profit ought to hang on to.  So that would still be a question.  It's a bit abstract but I would like to come back to that at some stage in the hearing, because I think it's a really good question.

CHAIR:  I'm glad you think it's a good question.  I'm sure the answer will be equally good.  Do you want to answer that now or take that on notice?

MS CUDDIHY: No, I'm quite happy to answer that.  I haven't seen it, but my team have a five year working cash flow model.  One of the things, of course, is that with the turnover the $110 million, we need to have sufficient reserves to continue to pay our debts and our payroll.  But as I had mentioned, the things that the Board has really earmarked and management is to replace our computer systems.  The NDIS is very complicated, it is driven a lot of administration and where we can reduce administration, it means that our staff can spend more time focusing with the clients, and that can be those processes automated. 

We have a commitment to the New South Wales State Government in relationship to the property sits in, that we transferred to Sunnyfield.  We have a commitment to them in a transfer deed where we must replace some outdated 1960s buildings that exist at Allambie Heights.  We also invested in a new community hub in Tweed Heads and we are about to set up a second one in Armidale.  We are also upgrading quite a number of our shared living homes, both in terms of compliance matters, but also in terms of, you know, liveability for the clients --- painting, making them more contemporary.  So there is a continual reinvestment into Sunnyfield.  We are not just building our balance sheet for the sake of it.  There is significant expenditures expected for that money.

COMMISSIONER GALBALLY:  Some of that investment would have other funding, I'm sure, and we might try and get the detail of that later.  Thank you.

CHAIR:  You said that one of the services that Sunnyfield provides is assisting people in their dealings with the NDIA for the purposes of the NDIS.  But it's in Sunnyfield's interests to do that, isn't it?  Because you are getting more funds from the NDIS, which ---
 

MS CUDDIHY:  It's not so much the funding ---

CHAIR: --- go to you?

MS CUDDIHY: I don't believe the motivation is a financial one.

CHAIR:  I didn't ask the motivation.  I just said it is to your advantage to do it in the end, isn't it?

MS CUDDIHY: The advantage is if the supports are tailored to the clients and they are what the client needs, then it's an advantage to everybody, the staff included, and to the clients in meeting their direct needs.

CHAIR:  And to Sunnyfield's financial position.

MS CUDDIHY:  We don't necessarily make any more margin out of that.

MS CUDDIHY:  So we may in certain instances but we are trying to achieve here a good outcome for the clients.  And yes, that's a win win, that's a win win.

CHAIR:  The NDIS has had a marked impact, hasn't it, upon the revenue of Sunnyfield?

MS CUDDIHY:  Yes, it has.  The funding in our --- for people who lived in shared independent living prior to the NDIS was much lower and that's across the whole sector, not just Sunnyfield, which I think created great difficulties in being able to provide the level of supports that clients needed.

CHAIR:  The revenue --- the total revenue of Sunnyfield in the 2015/2016 year was $54.67 million and that's the revenue that has gone up to $110 million.

MS CUDDIHY:  And that's also increasing clients.  I would just like to let the Commission know that the NDIS has recognised that the proportion of their budget on shared independent living is too high and the sector is experiencing reductions in individual client plans of some 12 to 16 per cent of revenue, and that experience we have seen in practice, and in our budgets for next year we are potentially experiencing --- and this is a matter of quite some debate with the NDIA --- around the fact that the reduction is occurring in shared independent living funding, and that's because there are, I believe, have been forecasts that the proportion of SIL funding to the total NDIS budget is causing budgetary concerns.

CHAIR:  And one other question: would it be fair to say that the JobKeeper $8.6 million was rather a windfall for Sunnyfield?

MS CUDDIHY:  The way we've reported it there, we did not report it in our operating line.  So we are seeing there that it was very transparent, that we reported it  
below the line.  It isn't there reported directly in the operating ---

CHAIR: But in the end it was a bit of a windfall, because without it, the cost would have been $6 million. 

MS CUDDIHY:  You could look at it that way.

CHAIR:  Thank you.  It's now nearly 1.15.  We will adjourn until 2.15.

ADJOURNED    [1.11 PM]

RESUMED    [2.15 PM]

CHAIR:  Yes, Ms Eastman.

MS EASTMAN:  Thank you, Commissioners.

Ms Cuddihy, I want to turn to risk management.  That's the next topic.  Because this is a responsibility both of the board and of the senior leadership team.  If I can ask you if you have still got a copy of your statement?

MS CUDDIHY:  Yes.

MS EASTMAN:  Can I ask you to turn to paragraph 330.  Commissioners, you will find this on page 76 of your version.  Sunnyfield has three Board committees and one of those committees is the Audit, Finance and Risk Committee.

MS CUDDIHY:  Yes.

MS EASTMAN:  In terms of the AFR, that's the Audit, Finance and Risk Committee, at paragraph 333 you say:

The AFR Committee is directly responsible for the oversight of the Quality, Risk and Compliance function and in that role for the oversight of the Response Team and Complaints & Feedback functions.  The role of the AFR Committee is to assist the Board in its collective responsibilities in relation to Sunnyfield's financial affairs and reports by oversight of financial, corporate governance policy, internal systems, integrity and controls, statutory auditing processes and reporting.  In this role, the AFR Committee aims to support the achievement of Sunnyfield's organisational objectives and sustained viability within established limits of risk management.

Do you know how many members of the board are members of the AFR Committee?

 
MS CUDDIHY:  I'm trying to do a numerical calculation, but I think there would be at least three or four.  I'd have to specifically think of which directors, but that would be my thinking.

MS EASTMAN:  With respect to this particular committee, does this committee have a special relationship with any of the senior leadership team, in the sense that they work very closely with the leadership team?

MS CUDDIHY:  Certainly all of our committees and all of the board meetings do include most of the SLT for most of the agenda items.  But for this specific committee, there is obviously a relationship, in addition to myself, the General Manager of Corporate, the Company Secretary is at all committee and board meetings, and also the Chief Financial Officer.

MS EASTMAN:  Then if we turn to your paragraph 309, and Commissioners, you will find this on page 72, there is a Quality, Risk and Compliance Team and that team is responsible for a number of relevant mechanisms that operate to prevent, detect and respond to violence, abuse, neglect or exploitation of people with disability.  You set out in subparagraphs (a) through to (e) a number of those functions.

MS CUDDIHY:  Yes.

MS EASTMAN:  In subparagraph (e) there is a reference to quality, risk and compliance reports.

MS CUDDIHY:  Yes.

MS EASTMAN:  These are reports prepared by the Quality, Risk and Compliance Team and those are the reports that make their way to the AFR Committee and the board generally; is that right?

MS CUDDIHY:  Yes.

MS EASTMAN:  In terms of the particular responsibilities of the Quality, Risk and Compliance Team, you have identified the team as being responsible for mechanisms that operate to prevent, detect and respond to violence, abuse, neglect or exploitation of people with disability.  Is that the only function of this particular Quality, Risk and Compliance committee or does it look at risk more generally?

MS CUDDIHY:  My apologies.  Are you regarding the Audit, Finance and Risk Committee or regarding the Quality, Risk and Compliance Team?

MS EASTMAN:  Paragraph 309, so the Sunnyfield Quality, Risk and Compliance.  That first sentence at the introduction of 309.

MS CUDDIHY:  Oh, "Team".  My apologies.
 

MS EASTMAN:  Sorry, team.

MS CUDDIHY:  The Sunnyfield Quality, Risk and Compliance Team are involved in the quality assurance audits of all of our services.  They do their liaison with any external audits, which includes the NDIS Quality and Safeguards Commission audits and the International Standards Organisation audits.

There is also a separate team within that group, it's called the Response Team, which is also part of safeguarding and they particularly deal with any allegations of assault, abuse or exploitation of people with disability.  They also oversee or contribute to restrictive practices, authorisation panel.

Also separately in that team is a compliance officer.  Also in that team we look at workplace health and safety and that team also contributes to policies and procedures and improvement of those policies and procedures.

MS EASTMAN:  Is this team comprised of only members of the senior leadership team or is it a broader team that?

MS CUDDIHY:  There is a group of employees that work to the General Managers Quality, Risk and Compliance, but the General Manager Quality, Risk and Compliance, with his team, present their draft reports that are going to the board and more detail about those reports to the senior leadership team, which meets monthly, I think it would be, looking at quality, risk and compliance matters, in addition to the day to day interactions that that role and that team has with General Managers and the organisation.

MS EASTMAN:  Sunnyfield has a risk management policy, if I can direct your attention to hearing bundle B, volume two, behind tab 43.

MS CUDDIHY:  Yes.

MS EASTMAN:  This is a policy you have signed off on on 6 March 2019; do you see that?

MS CUDDIHY:  Yes.

MS EASTMAN:  Was there an earlier version of this policy, in particular a version of this policy in 2017 and 2018?

MS CUDDIHY:  I would believe that there would have been earlier versions.  I do not recall the exact dates of those versions.

MS EASTMAN:  Can you tell me what was the change, if any, occasioned by the risk management policy from March 2019?  What changed from the earlier version to this version?
 

MS CUDDIHY:  I can't tell you specifically the track change clauses that would have been specifically changed.  We were reviewing this policy in light of the duties of the NDIS Quality and Safeguards Commission.  Our board had also asked us to review our risk management policies and procedures, and the board were acutely aware to take on board the learnings of the Banking Royal Commission, as the board has been interested in the learnings from the Aged Care Royal Commission and I'm sure they will be very interested also in the learnings from this Royal Commission.

MS EASTMAN:  This report was prepared before you undertook the specific course on risk management in 2020; is that right?

MS CUDDIHY:  I may have been partially completing the early subjects at this stage, but yes.

MS EASTMAN:  Looking at the policy statement, it says:

Sunnyfield's policy on and approach to risk management is in line with the requirements set out in the National Disability Insurance Scheme Provider Registration and Practice Standards Rules 2018 and based on relevant regulations, standards and guidelines.  These include the international risk management standard and the ASX Corporate Governance Council's principles of good corporate governance.

Sunnyfield is not an ASX listed company.  Can I ask you, do you know why Sunnyfield has taken this approach that looks at standards relevant to listed corporations?

MS CUDDIHY:  My understanding was our Board has a very strong commitment to good governance principles and there are many avenues to benchmark against those good governance principles.  Whilst we are a not for profit organisation, we try to aspire to best practice.  That would be my understanding.

MS EASTMAN:  The international risk management standard, ISO 31000, what is the relevance of including that in a risk management policy for Sunnyfield?

MS CUDDIHY:  Sunnyfield has got accreditation to International Standards Organisation.  I don't believe we have accreditation to the risk management component of that, but in our continuous improvement journey, that would be something that we would consider.  We always     well, for quite a number of years, we have looked at our systems and processes, meeting International Standards Organisation processes, and we are externally audited to that.  But I don't believe we are audited to the risk management standard.  Again, it's trying to progress best practice.

MS EASTMAN:  Would the NDIS (Provider Registration and Practice Standard) Rules 2018 have any bearing on any revisions to this risk management policy?
 

MS CUDDIHY:  I'm sure they would have, yes.

MS EASTMAN:  This policy says that it applies to all Sunnyfield staff, its subsidiaries and associated entities.

MS CUDDIHY:  Yes.

MS EASTMAN:  If this policy applies to all Sunnyfield staff, is it your expectation that Sunnyfield staff are required to know the NDIS (Provider Registration and Practice Standard) Rules of 2018?

MS CUDDIHY:  My understanding is that all of our staff have undertaken the NDIS orientation modules, which I believe represents those standards.  So we keep a track of every single staff and all staff who are new must complete that training before commencement.

MS EASTMAN:  But does that require them to have a knowledge of the Registration and Practice Standard Rules 2018?

MS CUDDIHY:  They should have an overview understanding of that.

MS EASTMAN:  What about staff understanding the international risk management standard?

MS CUDDIHY:  I don't believe so.  The expectation is that there are quite a lot of standards, compliance, notices and so on, but our policies and procedures are written in such a way that they do not have to go back to the original legislation.  Those policies and procedures should be documents they can rely on.

MS EASTMAN:  What about the ASX Corporate Governance Council's principles of good corporate governance, how is that relevant to the Sunnyfield staff?

MS CUDDIHY:  That's the policy or the principles on which these documents are based.  So, again, they don't need to go back and read the original legislation, they should be able to rely on the policies and procedures of Sunnyfield, which give them guidance in compliance on a practical level.

MS EASTMAN:  Who are the subsidiaries referred to on that page?

MS CUDDIHY:  At the time of writing this, there was the Independence Fund, Trust one and two, which recently has been wound up.  The other entity     there are two other entities.  One is Endeavour Sunnyfield, that was an entity established to facilitate the amalgamation with Endeavour from the Hunter region.

MS EASTMAN:  That's what you gave some evidence about before lunch?

 
MS CUDDIHY:  Yes, correct.  And the other related entity is Gateway, which is a housing provider.

MS EASTMAN:  What are the associated entities?

MS CUDDIHY:  That's including those.  My apologies.

MS EASTMAN:  What's the distinction between a subsidiary and an associated entity?  What does it mean?

MS CUDDIHY:  In legal parlance, I'm sorry, I really couldn't say, but that is all of the --- the ones I described are all of the entities    

MS EASTMAN:  Did you write this policy yourself?

MS CUDDIHY:  No, I did not write the policy.

MS EASTMAN:  You just signed off on the policy?

MS CUDDIHY:  No, I don't just sign off on things.  I do read them.

MS EASTMAN:  Who wrote the policy?

MS CUDDIHY:  Back in March 2019, I'm sorry, I couldn't recollect, but I would believe it would have been contributed to substantially by our Quality, Risk and Compliance Team.

MS EASTMAN:  Just looking at those first two parts, policy statement and application of policy, it's a fairly sort of legalistic description of a policy statement and the application of a policy; would you agree?

MS CUDDIHY:  I don't have a lot to compare with.  I think risk management is something that the organisation does take seriously and, yes, I couldn't comment because I don't have a comparison.

MS EASTMAN:  The policy implementation is the next paragraph and that sets out that Sunnyfield aims to achieve best practice in the management of risks that potentially threaten to adversely impact on the organisation, its functions, objectives, operations, assets, staff, contractors, volunteers, and then we get to clients, and then members of the public or are associated with the new businesses and services.  Can you explain to me what that actually means?

MS CUDDIHY:  I think that's fairly all encompassing, saying that this policy statement applies to the Board and wide aspects of what the organisation does, and what it is trying to do, and those key stakeholders that it is achieving those services for.  That's my interpretation of that.

 
MS EASTMAN:  Can I suggest to you, from a fair reading of it, that it puts, in terms of risk management, at the top of the risk management concerns is the impact on the organisation, its functions, objectives, operations, et cetera.  And that clients come after the organisation, from the management of risks.  Do you accept that may be open, on reading this paragraph?

MS CUDDIHY:  No, I don't think it's prioritising in any particular order the importance thereof.  I wouldn't say that's how I would interpret it.  I certainly know that at Sunnyfield, as far as we are concerned, our clients come first.  Our organisation chart has our clients at the top of it, our new strategy is around clients and being customer led.  I wouldn't read that into this.

MS EASTMAN:  But the policy implementation doesn't put clients first or at the centre, does it?

MS CUDDIHY:  Um    

MS EASTMAN:  Have a look in managing risks, Sunnyfield, and then there are a number of dot points.

MS CUDDIHY:  Yes.

MS EASTMAN:  There is nothing in those dot points that identify clients or the recipients of services.  Do you agree?

MS CUDDIHY:  I don't believe those dot points are dealing with stakeholders, I think they are more around process issues.

MS EASTMAN:  That's right, this is managing risk for Sunnyfield.

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  And in managing the risk of Sunnyfield, the issues of violence, abuse, neglect or exploitation is not part of the identified points here for managing risk.  Do you agree with that?

MS CUDDIHY:  It's not written here explicitly but I believe implicitly everyone at Sunnyfield would believe that is what we are there to do.

MS EASTMAN:  This is a policy really directed to managing corporate risk, rather than the risks to recipients of services; would you agree?

MS CUDDIHY:  It could present that way.

MS EASTMAN:  Looking at the responsibilities, it is the responsibility of board members to set the culture, appetite, framework and objectives of risk management within Sunnyfield, and resource appropriately.  What does that mean?
 

MS CUDDIHY:  The Board does.  We have a separate risk appetite statement, we have a risk framework and they do set very clear objectives around risk management, and that is the process in which the Board oversights its governance.

MS EASTMAN:  What does that reference to setting a culture of risk management mean?

MS CUDDIHY:  I believe that's about the Board's leadership in regards to a zero tolerance approach to abuse, neglect, exploitation or any harm of clients.

MS EASTMAN:  It doesn't say that, does it?

MS CUDDIHY:  It is in other documents.

MS EASTMAN:  Which other documents?

MS CUDDIHY:  It is in the risk framework and the risk appetite statement.

MS EASTMAN:  We will come to those in a moment and you can show me where they are.

MS CUDDIHY:  And there are some KPIs, I believe, as well.

MS EASTMAN:  In terms of responsibility, this policy states it is the responsibility of all staff, agency staff, contractors and volunteers to comply with this policy and associated processes, including to identify, analyse, evaluate, respond, monitor, report and communicate risks associated with any activity, function or process within their relevant scope of responsibility and authority.

That is, you would agree, a very heavy onus on all staff and people who are volunteers?

MS CUDDIHY:  Yes.

MS EASTMAN:  How do all staff, agency staff, contractors and volunteers     how are they equipped to identify, analyse, evaluate, respond, monitor, report and communicate risks?  How is that done?

MS CUDDIHY:  In practice, that is done through our complaints process, complaints and feedback process, it's done through our incident management reporting system, it is done through our Response Team reporting, it is done through the whistleblower external service, and if people so wish to go to other external bodies, such as the NDIS Quality and Safeguards Commission.

MS EASTMAN:  Is that what the responsibilities are intended to do, to set up complaint mechanisms?
 

MS CUDDIHY:  I believe that that is a strong part of this.

MS EASTMAN:  How is that identifying, analysing, evaluating, respond, monitoring, reporting and communicating risks?  That only picks up reporting and communicating risks, doesn't it?

MS CUDDIHY:  Well, one, first people need to identify the risk.

MS EASTMAN:  Pausing there, how are all staff, agency staff, contractors and volunteers equipped to identify risk?  And what risk are they identifying?

MS CUDDIHY:  So they are trained.  They are trained in workplace health and safety.  We have induction for all staff and our volunteers and contractors.  We also have training in safeguarding.  We do ask all of our staff to identify if there are risks around our clients, risks around staff safety, property safety.  The "analyse" in there would be to assess that that is an inappropriate risk, to be able to say that risk is not proper and that they need to make the situation safe, then and there, and that they would report that risk.

MS EASTMAN:  Do you feel at the present time that all staff, agency staff, contractors and volunteers are equipped to identify risk?

MS CUDDIHY:  I believe that people are equipped to identify risk.  I think that we work within the Workplace Health and Safety Act, as well as under the NDIS Quality and Safeguards Commission requirements, and if people see a risk and they feel that risk is unacceptable or a concern, we do encourage people to report that risk.

MS EASTMAN:  What about analysing and evaluating risk, how are they equipped to do that?

MS CUDDIHY:  So a risk may be that     can I give an example, possibly?  In our employment services, if there was a pallet that someone had stored incorrectly on the side like this, rather than flat on the ground, that they would be able to identify that is a risk, they would analyse that potential risk is there that it would fall and they would either find somebody else to help them to put that pallet down on the ground or they would organise to communicate with somebody and report that, so that situation could be rectified, which would then prevent a danger to somebody.  So it doesn't necessarily     it can be a very practical situation.  But for people who are much further trained in these matters, it can be something that's more sophisticated.

MS EASTMAN:  There is, I think you have mentioned, a risk management framework and a risk management procedure.  Can I take you first to the risk management procedure.  That is a document behind tab 45 in the same volume.  I will ask you just to have a look at that, so you identify the document that I am on.  It says it was last reviewed August 2018.

 
MS CUDDIHY:  Yes.

MS EASTMAN:  Are you familiar with this document?

MS CUDDIHY:  Yes.

MS EASTMAN:  What is the purpose of this document?

MS CUDDIHY:  This document sets out the procedure to identify, assess, decide controls, implement controls, monitor and review risks and it talks about internal audits, external audits, and so on.  There is also a risk management framework that also goes with the risk policy and this document.

MS EASTMAN:  Just so we keep a track of the documents, the risk management framework is the document immediately before that at tab 44 of the volume; is that right?  That was last reviewed on 27 February 2019.

MS CUDDIHY:  Yes.  Thank you.

MS EASTMAN:  To understand the operation of the policy, you need to be familiar with the risk management framework?

MS CUDDIHY:  Yes.

MS EASTMAN:  And the risk management procedure?

MS CUDDIHY:  Yes.  They provide the operational framework and then the practical implementation of the policy.

MS EASTMAN:  Just looking at the respective dates, the risk management procedure has been in place in this form since August 2018?

MS CUDDIHY:  I believe so.

MS EASTMAN:  Then the risk management framework is a later document?

MS CUDDIHY:  Yes.

MS EASTMAN:  February 2019?

MS CUDDIHY:  Yes.

MS EASTMAN:  The policy to which, as I understand it, both those documents relate is the more recent policy from March 2019?

MS CUDDIHY:  Yes.

 
MS EASTMAN:  The policy comes after the procedure and the framework?

MS CUDDIHY:  In terms of revision dates, but that policy was there beforehand, so there would have been a prior version, I would understand, of that policy and that policy was updated at that date.

MS EASTMAN:  Looking at the risk management procedure, paragraph 1 says "Training and Resources":

All staff are trained in risk management principles, including a summary of Key Corporate Risks that Sunnyfield face, and risk management policy and framework and this procedure as part of their on boarding program.

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  When you spoke a moment ago about all staff, agency staff, contractors and volunteers, the training that you referred to is training that is provided when they commence employment; is that right?

MS CUDDIHY:  We have, depending on the specific risk category and the risk class and, in this instance, preventing and responding to allegations of assault, abuse or neglect or complaints thereof, staff are trained in terms of their on boarding program and they also have regular refresher training.

MS EASTMAN:  What I'm trying to understand is what sorts of risks these policies and procedures attach to.  Because if you have a look at this document, risk management procedure, and you look at roles and responsibilities, which separates out responsibilities for senior leadership team members and other particular managers and then more lower level employees, and you turn over the page, this is very much a work health and safety approach to risk management; is that right?

MS CUDDIHY:  I'm sorry, I couldn't comment on that from a     that's not my understanding.

MS EASTMAN:  Have a look at page two of nine, which says "The Risk Management Process".

MS CUDDIHY:  May I please refer you to, if you wouldn't mind, in the risk framework document    

MS EASTMAN:  I will come to the risk framework.

MS CUDDIHY:      because that sets out the risk classes.

MS EASTMAN:  But I am trying to understand how these three different documents work together.

 
MS CUDDIHY:  Mm hmm.

MS EASTMAN:  If you have a look at page two of nine, "How risks are identified", the identification of the risks is through work health and safety inspection checks, then audits, then community visitors, then feedback and complaints, client risk assessments, et cetera.  So there are 11 ways to identify risk.

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  None of the risk identification factors specifically focus on violence, abuse, neglect or exploitation, do they?

MS CUDDIHY:  I believe that the way in which this is structured is not     it's saying that there's multiple ways that any type of risk can be identified.  So it could be violence, abuse, neglect of clients, it could be workplace health and safety, it could be medical incidents, it could be property risks.  I think this is looking at it from more of a process point of view, rather than from a specific point of view.

MS EASTMAN:  You don't have a specific framework for violence, abuse, neglect and exploitation, do you?

MS CUDDIHY:  We do.  We have a separate document that is called preventing and responding to client abuse or neglect, and there is a separate policy and procedure around that.

MS EASTMAN:  That's not in the risk identification approaches.

MS CUDDIHY:  This is a process view of it, rather than on the specific topic of what the matter is.  We do have dedicated documents that cover those specific areas, as we do have a dedicated document on complaints and feedback.

MS EASTMAN:  There is an operational risk matrix that appears at page five of nine.  Then over the page there is a corporate risk matrix that appears on page six of nine.  There isn't a risk matrix for violence, abuse, neglect and exploitation in terms of risks of that nature standing alone, is there?

MS CUDDIHY:  Not to my knowledge.

MS EASTMAN:  Looking at the operational risk matrix, the way this works --- and please jump in     is that you identify particular areas where there may be a risk impact and then you make an assessment about the degree of risk from insignificant to critical; is that right?

MS CUDDIHY:  Yes, that's what the    

MS EASTMAN:  From an operational risk matrix perspective, the question of the areas of impact are safety, health and wellbeing, reputation and financial risk.  Do  
you agree with that?

MS CUDDIHY:  Yes.

MS EASTMAN:  From a corporate risk perspective, it's people, delivery, compliance, reputation and financial?

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  There's no standalone area of impact that identifies the clients or people receiving services from Sunnyfield.  Do you agree with that?

MS CUDDIHY:  Well, my interpretation of that is all people are treated equally here and in our corporate risks, people is the first area and they are all treated equally.  Likewise, in the operational risk, the safety of people and the health and wellbeing of people are there.

MS EASTMAN:  Let's look at the corporate risk matrix on people.

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  The insignificant risk is temporary loss of key people.  That's talking about staff, isn't it?  It's not talking about clients.

MS CUDDIHY:  Yes, you could read it that way.  You're right.

MS EASTMAN:  Let's read across.  Minor risk: minor impact on staff.  That's staff people, isn't it?

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  Moderate risk: unavailability of core skills affecting service.  That's staff.

MS CUDDIHY:  You are right.

MS EASTMAN:  Major risk: staff diverted from primary task.  That's staff, is it not?

MS CUDDIHY:  Yes, so that's in corporate risk.  You are right.

MS EASTMAN:  There is no risk factor for people other than staff identified either in the corporate risk matrix or the operational risk matrix.  Do you agree?

MS CUDDIHY:  In the operational risk matrix, would you not think that under safety and health and wellbeing, that includes clients and staff and all people?

MS EASTMAN:  Where does that say that?
 

MS CUDDIHY:  It doesn't but that's my interpretation of that.

MS EASTMAN:  First aid treatment, but the injury does not affect the person's ability to complete standard tasks.  Do you say that applies to a client?  This is safety, second column, minor risk.

MS CUDDIHY:  I think it could be interpreted either way.

MS EASTMAN:  Are you serious?

MS CUDDIHY:  Yes.

MS EASTMAN:  Moderate risk: medical treatments with up to one week's incapacity, ie unable to complete normal tasks.  That's a staff member risk, isn't it?

MS CUDDIHY:  No, I think it includes both.  But you could separate them out.

MS EASTMAN:  Let's go to page nine of nine.  This is where I've seen a reference to client risk.  In the document it says "Documentation and Recordkeeping":

To avoid an issue being neglected or only a bandaid solution being applied, risks and required action must be documented and followed up to ensure they are completed and the issue is closed.  The Sunnyfield risk assessment form is used when completing all risk assessments except for     you will see there is a list     client risk.

Does that not suggest that when you are looking at the risk management approach, the risk assessment form does not include risk assessments with respect to client risk?

MS CUDDIHY:  That's what that says there, but I think there are other mechanisms for that to be recorded.

MS EASTMAN:  Can I take you to the risk management framework.  Commissioners, that's tab 44.  The framework intent is described as:

Risk management is an integrated part of sound management practices and an essential element of good corporate governance, as it improves decision making and enhances outcomes and accountability.  At Sunnyfield, Risk Management is a tool used to support the achievement of the strategic and operational goals of the organisation.

I have stressed "organisation" there because it is the fact, is it not, looking at the risk management framework against the procedure and the policy, that Sunnyfield looks at risk management from the perspective of the impact on the organisation, not putting the clients and the service recipients at the centre of a risk management  
model.  Do you agree with that?

MS CUDDIHY:  No.  I think I have a different perspective and I respect your viewpoints.  On the next page, it talks through the domains of the key risks for Sunnyfield, and our first risk is the health, safety and welfare of clients, and that is our preeminent key risk.

MS EASTMAN:  But it is in the context of the impact on the organisation.  Do you understand the distinction?

MS CUDDIHY:  I can understand what you are implying but I don't believe that that's the intention of the document.

MS EASTMAN:  Still on page one of 15, under the heading "Risk Appetite and Risk Tolerance", the final paragraph says:

The Board of Directors set the type and the level of risk that Sunnyfield is prepared to accept.  The risk appetite set by the Board of Directors provides management with clarity and guides business and operational decision making.  The risk appetite relates to residual risk, ie, after taking into account any steps to reduce or mitigate risk.

Then in that context, you have the domain areas on the following page, which you have made reference to.  This is another way of looking at a matrix around risk, but it is different to the risk matrix which is identified in the procedures.

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  Do you agree with that?

MS CUDDIHY:  Yes.

MS EASTMAN:  In the procedures, there was nothing focusing on clients.  It was operational and corporate risk.

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  In the framework, the domains identify health, safety and welfare of clients, but there's a low tolerance for risk to health and safety of clients; is that right?

MS CUDDIHY:  Correct.

MS EASTMAN:  But only a medium tolerance of welfare for dignity of risk.  What does that mean    

MS CUDDIHY:  That was    
 

MS EASTMAN:      in terms of risk assessment?

MS CUDDIHY:  May I explain?  When this document was last updated, we had an independent expert come in.

MS EASTMAN:  This is the document, the most recent update, isn't it?

MS CUDDIHY:  Yes, it is.

MS EASTMAN:  Or is there a later    

MS CUDDIHY:  When it was updated in February 2019, the risk appetite statement was added to this document and there was quite a lot of debate and that debate comes around where people choose to do things that they want to choose to do in life, things that they may wish to be involved in, that, based on a risk assessed approach, we were going to be supportive of people to make choices of their own control.  So this was very much taken from a human rights approach, to allow people to have the dignity of risk, to choose the things that they want to do in life, in a considered way.  So if our clients wanted to make certain choices, we would support them in that, but when it came to health and safety, that we would look towards a residual risk that was very low.  So that was trying to be very focused around the choice and control of clients and the respect to clients.

MS EASTMAN:  But none of this risk management applies obligations to the clients.

MS CUDDIHY:  No, it's our organisational appetite to support the clients and that's still the right of the clients to have their choice and control, and that respect is given.

MS EASTMAN:  How is that risk factor     so a medium appetite for risk for welfare, for dignity of risk, and then under service delivery, also, dignity of risk is a medium risk.  How is that actually assessed, having regard to practical considerations?

MS CUDDIHY:  So there will be     we do have risk assessment forms that we can work with clients on.  But an example may be, you raised before, sometimes guardians or families may have a different view from a client, and an example may be that a client would like a girlfriend or boyfriend.

MS EASTMAN:  How is that a risk?

MS CUDDIHY:  I don't see it as a risk but some    

MS EASTMAN:  Or how is that an example of a risk?

MS CUDDIHY:  It is, because some families, their perception may be that that is not a suitable situation, where that is the right and the choice of the client.  So in  
supporting that client in their respectful relationships, so it's about people's choice.  If clients want to pursue certain sports activities, learn new skills, then Sunnyfield would support them in a safe framework to do that.

MS EASTMAN:  Looking at these risks, the question of reputational risk comes both in terms of the matrix we looked at for operational and corporate, but it is also one of the demands identified here at number 8.  Do you see that?

MS CUDDIHY:  Yes.

MS EASTMAN:  There is a low tolerance for reputational risk.

MS CUDDIHY:  Yes.

MS EASTMAN:  So that means that in Sunnyfield     Sunnyfield's reputation is very important and there's a very low tolerance for anyone who may, or anything that may, impact on Sunnyfield's reputation; is that right?

MS CUDDIHY:  Yes.  As, equally, there is a low tolerance for anything that would impact on the health and safety of clients.

MS EASTMAN:  Why is there a low tolerance for reputation?  Can I put this to you, that Sunnyfield has a low tolerance for people making complaints about Sunnyfield?

MS CUDDIHY:  No, not at all.  Not at all.

MS EASTMAN:  That Sunnyfield has a low tolerance for people making complaints that might adversely affect Sunnyfield's reputation?

MS CUDDIHY:  No, not at all.  One of the things that I think always has been a strength of Sunnyfield's is our membership, and what I respect and admire about our members and our clients, and this is something I think that most of the organisation, the majority of the organisation, holds very dear to our hearts, is that we really do value complaints, we value feedback, we also value praise, and that is something that helps us continually improve what we do, how we do it and, as an organisation, we do respect and appreciate that feedback.

MS EASTMAN:  Can I ask you this     I have a document here and I don't have a copy for you, but we will make it available.  These risk domains are considered by the Board from time to time; is that right?

MS CUDDIHY:  We do report back to the Board.  We report to the Audit, Finance and Risk Committee and we also report to the Board, structured around this risk framework.

MS EASTMAN:  Do you have any recollection of the Board considering risk to Sunnyfield's reputation and the source of the risk to Sunnyfield's reputation?
 

MS CUDDIHY:  In specific detail, no, I don't particularly.

MS EASTMAN:  If I put to you that one of the Board papers     I'm sorry, I don't have the number on it.  Commissioners, I will have to find the number.  It's from a board meeting on 15 May 2019.  The agenda item is 8.2, "Company Secretariat/Corporate report".  It is called "Confidential Client Extreme and High Risk Management Plan".

In that report, under the heading "Reputational Risk", there are two risks identified.  One is described as a particular individual and it is says "WH&S & sister quarrulent".  I suppose that means querulent, does it?

MS CUDDIHY:  I'm sorry, I can hardly see this document.  My apologies.

MS EASTMAN:  Can that document be expanded for Ms Cuddihy, please?  I'm on the second page.  I don't want you to say any of the names.  It's under "Reputation".

MS CUDDIHY:  Right.

MS EASTMAN:  Have you got that?

MS CUDDIHY:  Yes.

MS EASTMAN:  I'm asking you whether the spelling "quarrulent", is that intended to be querulent?

MS CUDDIHY:  I believe so.

MS EASTMAN:  Do you know that the person identified under "Reputational Risk", the first person, that is a resident in one of the 48 homes; is that right?

MS CUDDIHY:  They used to be a resident.  They no longer are.

MS EASTMAN:  Since when?

MS CUDDIHY:  Their relative made a decision to change their situation and I believe that they moved into a more individualised support in a community setting.  So that was their choice and I respect their choice.

MS EASTMAN:  That's a reference to a family member who is described as a querulent complainant; is that right?

MS CUDDIHY:  I believe so.

MS EASTMAN:  The second one you would know as Melissa?

 
MS CUDDIHY:  Yes.

MS EASTMAN:  Melissa is identified as a reputational risk?

MS CUDDIHY:  That's what the report says.

MS EASTMAN:  Is this a report that you provided to the Board?

MS CUDDIHY:  What date is it?  My apologies.

MS EASTMAN:  On the first page, it is 15 May 2019 and it says, I think, company secretariat or company secretary corporate report.  Is this your report?

MS CUDDIHY:  I'm not sure who the author was of that report at that date.

MS EASTMAN:  You would have seen papers going up to the Board, would you not?

MS CUDDIHY:  Yes, but I'm not necessarily the author of all those papers.  If the author is the CoSec Corporate, it's whoever was in that role at that time.

MS EASTMAN:  Melissa is identified as a reputational risk?

MS CUDDIHY:  I don't     I think it relates specifically to her guardian, not herself.

MS EASTMAN:  To Eliza?

MS CUDDIHY:  Yes.

MS EASTMAN:  Eliza is described here as a work health and safety and, Eliza, querulent complainant?

MS CUDDIHY:  I believe so.

MS EASTMAN:  The management of Melissa as a reputational risk is said to be:

Notice to exit, Sept '18, still not relocated.

MS CUDDIHY:  Right.

MS EASTMAN:  So that's the management of that risk.

MS CUDDIHY:  That's what it says.

MS EASTMAN:  The management of Melissa as a risk was to exit her from the service?

 
MR DUGGAN:  I object.  The reference is not just to Melissa as a risk, with respect, it's a combined risk.  But the witness (inaudible).  So, to put it as a simple proposition that Melissa is the risk    

CHAIR:  I'm not sure that it is, but it won't hurt to separate it out because it's a compound phrase.  Perhaps you could ask whether the sister was to be regarded as a quarrulent complainant and whether the notice was a response to the sister.

MS EASTMAN:  I will deal with it this way: the document is headed "Confidential Client Extreme and High Risk Management Plan".  So you understood this to be a management plan with respect to clients; is that right?

MS CUDDIHY:  I don't believe that reference is in regards to the client.  My understanding is the reference is in regards to the guardian.

MS EASTMAN:  Well, that can't be right    

MS CUDDIHY:  It is.

MS EASTMAN:      can it?  Look at the first entry, for "Client Extreme and High Risk Management Plan".  I don't want you to say the name, but the first entry identifies ---

CHAIR:  Is it possible to bring that up on the screen so we can follow it?

MS EASTMAN:  Commissioners, we will give you a copy of this because we haven't redacted the names of the clients.

CHAIR:  How are we going to help Commissioner Galbally?

MS EASTMAN:  I will have to rely on those assisting me.

CHAIR:  I'm terribly sorry, Commissioner Galbally, but we will do our best to get the document to you one way or another.

MS EASTMAN:  On Mr Duggan's point, that this is not about clients, it's about other things, Ms Cuddihy has just answered that she doesn't think it's that, and I'm putting to her that can't be right.  For example, the first category, client risk category, refers to a client and the nature of the risk is the person's fairly difficult health condition.  Do you agree with that?  So the risk is not the person's disease, the risk that's identified is to the client.  That's why I'm putting to you this is a client extreme and high risk management plan.

MS CUDDIHY:  I don't believe that that's the case, I'm sorry.  If the words are on that page, I don't believe that that was ever intended to be the case and that was not the indication at all.  At no stage, to my knowledge, in any shape or form has anyone ever suggested that the client Melissa was ever a concern from a WH&S or querulent  
complainant.

MS EASTMAN:  But the client Carl is identified as a high risk, isn't he?  This is on the first page.

MS CUDDIHY:  I'm struggling to see this document.  I do apologise, I had explained about my eyesight.

MS EASTMAN:  Have you got a copy for Ms Cuddihy, please.

CHAIR:  Can you run off a copy?  Maybe we could give one to Mr Duggan as well.

MR DUGGAN:  I have a hard copy, thank you.

CHAIR:  Very good.

MS CUDDIHY:  Thank you.

MS EASTMAN:  On the first page, there is a box that says "High Risk X 18".

MS CUDDIHY:  Yes.

MS EASTMAN:  Then there is a list of names.

MS CUDDIHY:  Yes.

MS EASTMAN:  You will identify the second name in that box is Carl?

MS CUDDIHY:  That's my understanding.  The second from the bottom?

MS EASTMAN:  Yes.

MS CUDDIHY:  Yes.

MS EASTMAN:  That is identifying the client who is the risk, is it not?

MS CUDDIHY:  It specifically relates to the behaviour rather than the client.

MS EASTMAN:  But it identifies the client, doesn't it?

MS CUDDIHY:  It is     these are issues related to those clients.

MS EASTMAN:  Carl is identified as a risk for the reasons set out on that document?  And what I want to come back and ask you, on the reputational risk, is this document does not identify risks by reference to anyone other than clients, does it?

MS CUDDIHY:  It relates to the clients but I don't believe it's specifically of that  
client.  And I'm sorry but    

MS EASTMAN:  You're saying with respect to Melissa, that that shouldn't really be Melissa, it should be Eliza and she's the risk; is that right?

MS CUDDIHY:  Regrettably, yes.

MS EASTMAN:  Commissioners, I might leave that document and I might need you to mark that.  I'm just wondering, time wise, it's almost 3.15, whether we might have a short break of 10 minutes, just so I can manage this document and also Ms Cuddihy can have a short break.

CHAIR:  Alright.  We will adjourn for 10 minutes.

ADJOURNED    [3.12 PM]

RESUMED    [3.27 PM]

CHAIR:  I understand that Commissioner Galbally has the document now.

Ms Cuddihy, I want to ask you a further question or two about this because I want to see if my understanding of this document is more or less correct.  Going to page 2 at the bottom, where there is a reference to Melissa and the sister being a querulent complainant     I must say, "quarrulent" strikes me as actually quite a good word.  We should perhaps adopt that.  In any event, the way I would read this is that the sister is regarded as a querulent complainant.  That's clear enough, isn't it?

MS CUDDIHY:  Yes.

CHAIR:  That the relevant situation     bearing in mind if you go back to page 1, the heading second from the right which is where the words "WH&S" and "sister quarrulent complainant" appear, that the relevant situation creating a reputational risk were the sister's actions as a querulent complainant.

MS CUDDIHY:  Yes.

CHAIR:  And the notice was a response to the reputational risk?

MS CUDDIHY:  Yes.

CHAIR:  That seems clear enough.  Thank you.

MS EASTMAN:  Thank you, Commissioners.  I want to move to a different topic and that is the circumstances in which Sunnyfield came to take on the house in  
Western Sydney.  Ms Cuddihy, it is the case, isn't it, that in around November 2016, the families of the residents at the house began some discussions with Sunnyfield about Sunnyfield becoming the new service provider?

MS CUDDIHY:  Yes.

MS EASTMAN:  Were you involved in those discussions?

MS CUDDIHY:  No.

MS EASTMAN:  Were you aware of those discussions?

MS CUDDIHY:  I did become later aware of those discussions.

MS EASTMAN:  When did you become aware of those discussions?

MS CUDDIHY:  I believe in the new year.

MS EASTMAN:  When you say "in the new year", of 2017?

MS CUDDIHY:  I believe so.

MS EASTMAN:  Do you know anything about the circumstances of the families approaching Sunnyfield?

MS CUDDIHY:  I understood that they were seeking a different service provider, that they were not satisfied with their current service provider.

MS EASTMAN:  When you became aware of the families seeking Sunnyfield as a new service provider, at that stage did you know anything about the circumstances of the existing service provider?

MS CUDDIHY:  Not particularly, no.

MS EASTMAN:  Do you know who at Sunnyfield was the primary point of contact with the families from November 2016?

MS CUDDIHY:  I believe Dr Mark Clayton was involved and possibly also a lady in our client engagement team called [REDACTED].

MS EASTMAN:  Are you aware that Sunnyfield provided some brochures and documents about the nature of Sunnyfield's services and how Sunnyfield operated to the families?

MS CUDDIHY:  I didn't know the full details.  We would always provide brochures.  I know in the January of that year we provided them with the contracts, which are the NDIS Commission     sorry, the NDIS or NDIA benchmark contracts that were our  
standard contracts.  They were provided, not with the details of those individuals but that was provided to them in the January, and I believe they were provided with information to help them inform a decision.

MS EASTMAN:  Were you aware that they were provided with something called the Shared Living Operations Manual?

MS CUDDIHY:  At that time, no.

MS EASTMAN:  Do you know about a document described as Shared Living Operations Manual?

MS CUDDIHY:  Yes, I certainly do.

MS EASTMAN:  What's that document?

MS CUDDIHY:  It's a document that explains for our staff how     it's a go to document that is a directory, to policies and procedures throughout Sunnyfield and hopefully helps them in their orientation to the organisation and helping them in their duties working in a shared living home.

MS EASTMAN:  So the manual is about the requirements of the staff who work in the homes; is that right?

MS CUDDIHY:  It is particularly focused for the staff.

MS EASTMAN:  Why would that be provided to the families prior to any arrangement being entered into or agreement that you would provide services?

MS CUDDIHY:  I don't know.  It is unusual.

MS EASTMAN:  Have you made any inquiries as to why it was provided to the families?

MS CUDDIHY:  No.

MS EASTMAN:  Are you aware, at least on Eliza's part, that she considered Sunnyfield's Business Development Manager and the Client Engagement Manager     now, is that Dr Clayton and [REDACTED]?

MS CUDDIHY:  Dr Mark Clayton, either at the time     I think he was the NDIS transition General Manager and he had also been a Shared Living Manager.  I don't believe he had been involved in new business development, but certainly the Client Engagement Manager was involved in business development.

MS EASTMAN:  Are you aware that Eliza says that the Business Development Manager and a Client Engagement Manager, as well as the Executive General  
Manager of Shared Living, answered her queries and concerns in a manner where she formed the view that Sunnyfield was open to finding creative solutions to particular issues?  Are you aware of that?

MS CUDDIHY:  I believe that was in Eliza's statement.

MS EASTMAN:  Was it the function of any of those three, the Business Development Manager, the Client Engagement Manager or the General Executive Manager of Shared Living, to encourage prospective new service recipients by answering queries and looking for creative solutions to issues?  Was that part of their role?

MS CUDDIHY:  I would believe so, yes.

MS EASTMAN:  When, in this case, the families were looking to Sunnyfield, can I put it this way: Sunnyfield was doing its best to demonstrate to the families that you would be the right organisation to look after Melissa, Chen and Carl; is that right?

MS CUDDIHY:  I don't think     I think it's a bit more nuanced than that, if you wouldn't mind me saying so, in that we want to understand what the clients' and the families' needs are, whether we are the appropriate organisation to be able to supply those needs and whether we think there will be a good mutual benefit in that relationship.

MS EASTMAN:  What do you mean by a good mutual benefit?

MS CUDDIHY:  Well, not all people with a disability, respectfully, want to choose Sunnyfield.  We do specialise particularly in intellectual disability.  So it's trying to understand exactly what the needs of the families and the clients are.  We would not want to enter into any agreement that, in good faith, we didn't feel that we could deliver.

MS EASTMAN:  Does mutual benefit mean that you just want to have people who are not going to be difficult or troublemakers?

MS CUDDIHY:  No, at all.  We really, as I said before, appreciate complaints and we appreciate feedback and we are an organisation that is open to improvement and that's part of the reason why I'm here today, because as an organisation we take these things very seriously and we want to improve what we do.

MS EASTMAN:  In April 2017, were you aware that the previous service provider gave notice that it would cease its services and all its staff would be removed from the house by 1 May?

MS CUDDIHY:  I don't believe we were aware in advance that they would exit their staff.  On my understanding, the staff left by lunchtime that day and we were not aware that that would happen and we would never recommend that.  A considered  
transition plan should occur, particularly because, for the clients and especially these clients, who have quite significant disability, a very proper transition plan should occur.  I think that was quite a shock to our staff and a shock for everybody, which I think was not a good way to transition a service at all.

MS EASTMAN:  You say in paragraph 83 of your statement that you did not     Sunnyfield was not provided with a copy of the cessation notice from the previous provider.  At paragraph 84 you say that on the same day Sunnyfield was informed by the families that they had received a notice.  I'm just trying to understand the timing on when you became aware, when Sunnyfield became aware, that    

MS CUDDIHY:  My understanding ---

MS EASTMAN:      the previous provider was going to cease providing services and remove all staff from the house by 1 May.  When did you become aware of that?

MS CUDDIHY:  When the families told us.  I do not believe we had correspondence with the previous provider.

MS EASTMAN:  So the families told you that 1 May was going to be the date?

MS CUDDIHY:  I believe so.

MS EASTMAN:  It was Sunnyfield's position that before it could take over the provision of services, the families would need to sign the relevant Service Support Agreements and the Residency Agreements; is that right?

MS CUDDIHY:  Yes, because it would be very difficult to recruit staff and particularly    

MS EASTMAN:  I'm not asking you why, I'm just asking you whether that's what you required.

MS CUDDIHY:  That's correct.

MS EASTMAN:  Were you aware that this very short timeframe put a lot of pressure on the families?

MS CUDDIHY:  It put pressure on everybody, yes.

MS EASTMAN:  But it put pressure on the families, did it not?

MS CUDDIHY:  Yes.

MS EASTMAN:  In terms of providing the relevant contracts to the families to sign, it's the case, isn't it, that the contracts were not provided, at least in Eliza's case, until  
6 April 2017?  That's right, isn't it?

MS CUDDIHY:  My understanding is that contracts are standard contracts    

MS EASTMAN:  I'm not asking you about the standard contracts, I'm just asking you whether or not you are aware that Sunnyfield sent Eliza contracts on 6 April 2017.  If you're not aware of it, say.  But if you do know, can I ask you just to answer the question.

MS CUDDIHY:  Specific contracts with the specific details in the annexures for Melissa were sent to Eliza on that date.

MS EASTMAN:  On 6 April?

MS CUDDIHY:  That is correct.  But they had received contracts of a standard form, without the specific details, in the January, is my understanding.

MS EASTMAN:  You are aware, are you not, that Eliza wanted time to get legal advice in relation to the contracts?

MS CUDDIHY:  Only from her statement, yes, but one would expect that.

MS EASTMAN:  When you say "one would expect that", that is because these contracts have a legal effect, do they not?

MS CUDDIHY:  They do.

MS EASTMAN:  And signing up to a contract of this type can have legal implications for the residents, the residents' family member or representative and also for Sunnyfield; is that right?

MS CUDDIHY:  That is correct.

MS EASTMAN:  These contracts were drafted by Sunnyfield?

MS CUDDIHY:  No, these contracts are used from what was at the time the NDIA suggested model contract.  So they are very, very close to what the NDIA recommended.

MS EASTMAN:  But these are contracts that were prepared by Sunnyfield?

MS CUDDIHY:  Based on the NDIA model contracts.

MS EASTMAN:  You are making a point of saying that they are the NDIA model contracts.

MS CUDDIHY:  Yes.
 

MS EASTMAN:  Is the purpose of that to say that the clauses and the terms reflect something that the NDIA requires of service providers?

MS CUDDIHY:  No.

MS EASTMAN:  Or are you saying it's a guide to service providers?

MS CUDDIHY:  I believe that at the time the NDIS was new, there hadn't particularly been contractual arrangements in place in the sector, and that the NDIS was trying to set out a best practice guideline of a model contract that could be used, and Sunnyfield felt that it would adopt that.

MS EASTMAN:  Did Sunnyfield get legal advice on these contracts itself?

MS CUDDIHY:  I can't specifically recall, but most likely.

MS EASTMAN:  When you say "most likely", is it your practice, if Sunnyfield is to enter into legal arrangements, that it would take legal advice before signing a contract or entering into a legal relationship?

MS CUDDIHY:  Yes, we would.

MS EASTMAN:  Does Sunnyfield have an inhouse lawyer?

MS CUDDIHY:  No.

MS EASTMAN:  Does Sunnyfield have a panel of lawyers that it uses?

MS CUDDIHY:  We do have different law firms that we utilise for different areas of contractual matters.

MS EASTMAN:  What are the firms or lawyers that you use for contractual matters?

MS CUDDIHY:  In terms of     I couldn't tell you, to do with the client contract matters.  The client contract matters, when we originally set up those agreements, we did have an inhouse lawyer, Mr Jonathan Swain, who was involved in reviewing those contracts.  But    

MS EASTMAN:  He was the Company Secretary; is that right?

MS CUDDIHY:  He was, and he no longer works for Sunnyfield, so we do not have an inhouse lawyer at Sunnyfield.

MS EASTMAN:  Was he an inhouse lawyer when he was also performing the Company Secretary role?

 
MS CUDDIHY:  He was     his title was not counsel inhouse but he was     and I don't know if he still is     a lawyer.  But he did offer his services in that regard.

MS EASTMAN:  Did he have a practising certificate at the time he gave legal advice and was working as Company Secretary?

MS CUDDIHY:  I'm sure he did.

MS EASTMAN:  But you don't know, do you?

MS CUDDIHY:  I can't tell you right now but he would not be offering those services if he did not.

MS EASTMAN:  In terms of the firms or other lawyers who you seek assistance from, we have seen in the material reference to Clayton Utz and also Williamson Barwick.  Is it possible that Clayton Utz provided advice to Sunnyfield in relation to these agreements?

MS CUDDIHY:  I really can't recall that.  I would be surmising.

MS EASTMAN:  Do you have oversight of any budgetary matters in relation to legal expenses?

MS CUDDIHY:  Our CFO has the detailed oversight but certainly I do review our financial performance each month and the statutory accounts.

MS EASTMAN:  If I ask you which lawyers reviewed and/or prepared these agreements, can you tell the Royal Commission who that was or which firm was?

MS CUDDIHY:  No, I can't because I can't answer that question truthfully because I don't know the answer.

MS EASTMAN:  Had you yourself ever read the Service Supports Agreements?

MS CUDDIHY:  Yes, I believe I have and, as I said, they are modelled off the NDIS or NDIA model contracts.

MS EASTMAN:  When did Sunnyfield first start to use the model contracts?

MS CUDDIHY:  When the NDIS first came into effect, and I think for Sunnyfield, that started     whether the first agreements occurred in July 2016, but a number of our clients, being in New South Wales, in one of the early areas of entry, when the scheme rolled out, it would be in the months after July 2016.

MS EASTMAN:  Can I ask you to have a look at hearing bundle part A, volume 1, behind tab 13, please.  Do you have that?

 
MS CUDDIHY:  Thank you.

MS EASTMAN:  Do you recognise that as Service Supports Agreements?

MS CUDDIHY:  Yes.

MS EASTMAN:  If you go to the bottom of the page, in the right hand corner it says, "In compliance with Disability Service Standard 6."  Do you know what that is a reference to?

MS CUDDIHY:  I couldn't recall right now.

MS EASTMAN:  It has "Owner", "General Manager" and is that "Business Development and Funding"?

MS CUDDIHY:  Yes.  As I mentioned before, contractual matters are handled through that area.

MS EASTMAN:  But it doesn't make a reference there to the company secretariat or the company secretary; do you agree with that?

MS CUDDIHY:  No, because he would not have been the owner.  The owner is the commercial team and any legal review would be done separately.  They wouldn't be the owners of the document.

MS EASTMAN:  This says "Last review 17 October 2016".  Do you see that?

MS CUDDIHY:  Yes.

MS EASTMAN:  Can we draw from that that this is a template form contract that was current as at 17 October 2016 and used by Sunnyfield thereafter?

MS CUDDIHY:  It would have been used until it was superseded.

MS EASTMAN:  When was this form superseded, do you know?

MS CUDDIHY:  I do know that when the Department of Communities and Justice, who previously were FACS, who changed their leasing policies in regards to the properties, they asked us to change the agreement form and they put forward a standard agreement in relationship to the housing component.  And then they also had a model contract from Department of Communities and Justice for clients for the shared independent living and then they also had a separate agreement with providers in regards to a side deed that belonged with those agreements.

MS EASTMAN:  When did that happen?

MS CUDDIHY:  Oh, gosh.  It's been a very long ongoing process.  I believe the  
execution of those has occurred only very recently, but they were backdated and the date escapes me.

MS EASTMAN:  Could it have happened towards the end of the financial year in 2018?

MS CUDDIHY:  It could have.

MS EASTMAN:  When the contracts were updated, the residents who signed up to the version of the contract which I'm about to take you to, have they had their contracts renewed or revised to reflect the new contracts?

MS CUDDIHY:  I would have believed so.

MS EASTMAN:  When you say you believe so, are you sure?

MS CUDDIHY:  I can't tell you 100 per cent, but that was a requirement from the Department of Communities and Justice and I would believe that would have been the case.

MS EASTMAN:  Earlier today, I asked you about the 215 residents and you said, I think, one might have been there for about 30 years.  Does that person have a contract in this form or the new form?

MS CUDDIHY:  Yes.  All participants that entered into the NDIS would have this contract in this type of form, yes.  And that was an appropriate thing to protect their rights as they moved into the NDIS.

MS EASTMAN:  You said you are familiar with this contract.  Can I just ask you to look at this particular document.  This is Melissa's contract.  Do you agree with that?

MS CUDDIHY:  I believe so.

MS EASTMAN:  She is described as a participant in the National Disability Insurance Scheme.

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  The agreement is made between Sunnyfield and Eliza, the sister of Melissa.

MS CUDDIHY:  Yes.

MS EASTMAN:  The participant's representative signs and enters into the contractual arrangement if the participant herself is unable to sign or doesn't have contractual capacity; is that right?

 
MS CUDDIHY:  Yes.

MS EASTMAN:  What is Sunnyfield's policy in relation to determining whether or not a participant has capacity to enter into contracts of this kind or to understand what the participant's obligations might be?  Do you have an approach to determining capacity within Sunnyfield?

MS CUDDIHY:  My understanding is that we would, first and foremost, liaise with the person's guardian or their person responsible, and understand what their capacity and consent is and/or any other representatives of that client and, of course, with the client themselves.

MS EASTMAN:  What was done in that respect in relation to Melissa, in that period between 6 April 2017, when the agreement was sent, and the requirement to have them signed before 1 May 2017?  What steps did Sunnyfield take to make any inquiries about Melissa's capacity?

MS CUDDIHY:  I don't know the answer to that question.  I'm sorry, I haven't asked those questions.

MS EASTMAN:  Have you reviewed any document that might reflect on those matters at all?

MS CUDDIHY:  Not to my knowledge but if I have forgotten, please let me know.

MS EASTMAN:  When you were preparing your statement, did you have a look at all relevant documents concerning Melissa and her services with Sunnyfield?

MS CUDDIHY:  I have looked at thousands of documents and if I have missed something, please, I apologise.  But I can't recall.

MS EASTMAN:  Does Sunnyfield have a particular standard form or way of documenting how it determines a person with disability's capacity to consent or understand or be a party to a legal document like this?  Do you have a standard way of doing that?

MS CUDDIHY:  I'm not sure.

MS EASTMAN:  When you say you're not sure?

MS CUDDIHY:  I don't know.

MS EASTMAN:  You are the one responsible for these policies, aren't you?

MS CUDDIHY:  I am responsible for a lot of things at Sunnyfield and I have an executive team who I trust and rely upon and a number of those matters that they would deal with.  I am certainly not across everything that happens at Sunnyfield  
every single day.

MS EASTMAN:  Melissa and her house mates are the recipients of services?

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  Sunnyfield has a primary obligation to the recipients of the services; is that right?

MS CUDDIHY:  Yes.

MS EASTMAN:  Therefore, Sunnyfield must have some policy or practice that helps Sunnyfield identify and understand the service recipient's capacity to consent, to make decisions such as entering into agreements of this kind; surely they have that?

MS CUDDIHY:  We would have relied upon the guardian and what the guardian had communicated to us in this circumstance.

MS EASTMAN:  What if there's no guardian, what do you do?

MS CUDDIHY:  That can present challenges.  A number of our clients are with Trustee and Guardianship and we engage with Trustee and Guardianship to help work through those matters for the client.

MS EASTMAN:  Looking at this document, the purpose of the document is to record the supports under the participant's NDIS plan that Sunnyfield will provide, and a copy of the NDIS plan becomes an attachment to the contract; is that right?

MS CUDDIHY:  I believe that the details of that are put in the annexures or the schedules.

MS EASTMAN:  The document then sets out the way in which Sunnyfield agrees to provide the NDIS supports and the payment arrangements?

MS CUDDIHY:  Yes.

MS EASTMAN:  Do you agree with that?

MS CUDDIHY:  Yes.

MS EASTMAN:  Then if we turn over the page ---

MS CUDDIHY:  Which page, please.

MS EASTMAN:  This is a strange document because the pages are "of four", but we end up going to well beyond four.  Can I describe it as two of four and in the top right hand corner there is a document reference number that ends with 0264.  Do you  
have that?

MS CUDDIHY:  Yes.

MS EASTMAN:  There are arrangements here in terms of how NDIS funding is managed and how payment is made to Sunnyfield.

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  Is this a standard term that comes from the NDIS template or is this a term developed by Sunnyfield?

MS CUDDIHY:  I can't intimately tell you that.  I don't know that specifically.

MS EASTMAN:  But is part of setting out the funding and the payment arrangements to ensure, as far as possible, that any funding from the NDIS makes its way directly to Sunnyfield, without having to go through the intermediary of the participant's coordinator or family member or representative?  Is that the purpose of setting out the payment arrangement here?

MS CUDDIHY:  It is fairly standard practice, not only within Sunnyfield but the sector where    

MS EASTMAN:  I'm just asking you about Sunnyfield, not the sector.

MS CUDDIHY:  Okay.  My apologies.

MS EASTMAN:  Is that the purpose, to set up an arrangement in this contract that the NDIS funding goes to Sunnyfield but not through any intermediary, like a participant's family?

MS CUDDIHY:  It is their choice if they so wish to self manage.

MS EASTMAN:  How do you have choice in this    

MS CUDDIHY:  There are clients who choose to self manage and there are clients who choose to use a plan manager, but the majority of people choose not to do that.

MS EASTMAN:  Where in the description on this page does it indicate that there is some choice here?

MS CUDDIHY:  I haven't read the page intimately recently.  Would you like me to read that?  There is on this side, "How is the NDIS funding managed".

MS EASTMAN:  Yes.

MS CUDDIHY:  So there's the option to go through the agency, there's the option for  
the person to self manage    

MS EASTMAN:  Yes.

MS CUDDIHY:      and there is the option for it to have a plan nominee, so that option is there, or a registered plan management provider.

MS EASTMAN:  It's quite complex, isn't it, to try to work out what that means.  Do you agree?

MS CUDDIHY:  The NDIS is very complex.

MS EASTMAN:  The NDIS is not a party to this contract.

MS CUDDIHY:  But the NDIS offers these forms and that's the     from the NDIS    

MS EASTMAN:  Are you blaming the NDIS for the contract here?

MS CUDDIHY:  No, I'm just explaining that the NDIS provides participants with options in how they choose to manage their funds.  They can     and they are spelled out there.  So we are being clear about what the NDIS parameters are and how people can manage that.

MS EASTMAN:  You are aware, aren't you, that one of the residents in the house in Western Sydney, his first language is not English and his families' first language is not English?

MS CUDDIHY:  Mm hmm.

MS EASTMAN:  It's the case, isn't it, that these contracts were not provided in alternative formats, in language other than English?

MS CUDDIHY:  Excuse me, I'm getting a frog in my throat.

MS EASTMAN:  I think we are very close to time, so we might finish on this one.

MS CUDDIHY:  Look, yes, I am aware of that.  I'm not aware the person particularly asked for that, but I do see that is a very important communication device.  I do appreciate and respect that and that is something that     providing our contracts in alternative, in different languages, is something that we should consider.

MS EASTMAN:  Just to finish on this point perhaps, when you look at the box, underneath that it says:

The way in which the participant's NDIS funding is currently managed is set out in schedule 2.  If the participant's funding is managed by a plan nominee or  
by a registered plan management provider, the participant or the participant's representative must provide the name of the plan nominee or registered plan management provider and the relevant contact details to Sunnyfield.

That's a pretty important matter for people to know and understand what they need to do; is that right?

MS CUDDIHY:  Yes, that's right.

MS EASTMAN:  Turn to schedule two, which is on page 10 of four, the last four numbers at the top of the page are 0272.

MS CUDDIHY:  Sorry, this is schedule two, "NDIS Supports"?

MS EASTMAN:  That's it, yes.  If you go to the next page, item five, "Funding Arrangements", this is the part you have to complete to, in effect, decipher the funding options as presented in the contract.  Do you agree with that?

MS CUDDIHY:  That's where people elect which way they would like to do their payment through, what mechanism.

MS EASTMAN:  The upshot of clause three is that it leads you to this ticking the box or marking X on the box under item five; is that right?

MS CUDDIHY:  I believe so.

MS EASTMAN:  In this case, you will see that the details of the plan nominee or registered plan management provider is Eliza?

MS CUDDIHY:  Yes.

MS EASTMAN:  From Sunnyfield's perspective, in terms of managing the NDIS funding, what is the most convenient option for Sunnyfield?  Is it managed by a plan nominee or is it managed by the NDIA or a self managed participant?  What's the most convenient for Sunnyfield?

MS CUDDIHY:  I don't think we have a preference.  It's really entirely up to the client and the guardian.

MS EASTMAN:  If the Commissioners can bear with me for a few minutes, I just want to deal with a few more clauses in this contract.  Otherwise, I'm content, we can come back to it tomorrow.

CHAIR:  It would be a pleasure to bear with you for another few minutes.

MS EASTMAN:  Thank you, Chair.

CHAI 
R:  I speak only for myself, of course.

MS EASTMAN:  I just want to deal with a few clauses in this contract.  Could you please go back to page three of four.  At the top right hand corner it is 0265.

MS CUDDIHY:  Yes.

MS EASTMAN:  This sets out the responsibilities of Sunnyfield.  The matters set out in clause six (a) through to (i), do you see that?

MS CUDDIHY:  Yes.

MS EASTMAN:  Are these part of the NDIA's standard terms?

MS CUDDIHY:  I couldn't recall.

MS EASTMAN:  Have you seen the clause in this form before?

MS CUDDIHY:  Yes, I have.

MS EASTMAN:  You would know, would you not, whether they reflected the NDIA standard terms or they were Sunnyfield specific?

MS CUDDIHY:  I couldn't answer that question.  I don't know the answer to that question.  I could not tell you something I don't know the answer to.

MS EASTMAN:  If Sunnyfield wanted to set out its responsibilities, it would have been open to Sunnyfield to refer, for example, to some of its policies such as The Sunnyfield Way or the Person Centred Policy or the missions, values and statements of that client; would you agree?

MS CUDDIHY:  We could do.

MS EASTMAN:  When you look at what Sunnyfield agrees to do, there's nothing in clause six where Sunnyfield has agreed to be bound by any of its own policies.  Do you agree with that?

MS CUDDIHY:  That's a commitment that we make within the organisation and those policies change from time to time.  Generally speaking, as I mentioned before, I'm not aware of us issuing our internal operations manual to clients and families.  It's normally considered to be an operational document.

MS EASTMAN:  And that includes the relevant policies?

MS CUDDIHY:  It doesn't     well, it's a     we have thousands of policies, procedures and work instructions and forms.  It is a reference document, as I mentioned, for staff, and it's really about practical issues in the home.  We do have  
a number of our policies on our website and we would reference those and, obviously, we are committed to those.  But our documents update and modify from time to time.

CHAIR:  I think Ms Eastman asked you whether clause six included any provision that requires Sunnyfield to comply with its policies, and I take it from what you have said that the answer to that is no?

MS CUDDIHY:  I'm not specifically aware of that clause, but I'm happy to read through here and check that.

MS EASTMAN:  Can I ask you about clause seven, which is the responsibilities of the participant or the participant's representative.  So that's cast as either/or.  In terms of the onus on either the participant or the participant's representative, this particular contract doesn't make any distinction.  For example, it hasn't ruled out the participant being Melissa and just made these the responsibility of the participant's representative.  Do you agree?

MS CUDDIHY:  Yes.

MS EASTMAN:  The matters that are set out in clause seven, which you will see over the page, do these come from the standard NDIA model policy?

MS CUDDIHY:  I can't tell you the answer to that question.  I would have to go back and check that original document against this.

MS EASTMAN:  Then looking at the next page, which is page five of four, it has the number 0267.

MS CUDDIHY:  Yes.

MS EASTMAN:  There is provision for suspension of supports and services.  You will see that this provides:

If any invoice is not settled in full when due .... Sunnyfield will send a reminder notice to the participant or the participant's representative, as applicable.  If the invoice is still not settled in full within 14 days after the reminder notice has been sent then Sunnyfield may stop providing any of the services or supports that the participant or the participant's representative has to pay for directly.

MS CUDDIHY:  Yes.

MS EASTMAN:  Is this a standard clause in all the Sunnyfield contracts?

MS CUDDIHY:  As at that date, it would have been.

 
MS EASTMAN:  But not anymore?

MS CUDDIHY:  I'm not sure if it is currently.  But I'm certainly not aware of where we have ever stopped services because of financial hardship or difficulties.  We say that here:

At any stage if you are having financial difficulty, please tell us and we will review on a case by case basis to try and find a workable payment solution.

MS EASTMAN:  Why is it necessary then to have a clause that says, in effect, "After we have sent you a reminder and if you haven't paid within 14 days, we will stop providing services"?  Why have that clause in here?

MS CUDDIHY:  I suppose it's trying to indicate that there is a finality to it.  But I'm not aware that we have ever invoked this clause.

MS EASTMAN:  I asked you earlier about whether there was any convenience to Sunnyfield as to whether or not the funds came through NDIA, through a nominated person, or the like.  If you have a look at the next paragraph in clause nine, this suggests:

Sunnyfield will not stop providing services that are managed through the NDIA and for which Sunnyfield claims payment directly from the NDIA unless those payment claims are not met by the NDIA, for example, because the participant's NDIS plan is suspended or the participant stops being a participant in the NDIS, or the participant's NDIS plan allowances are exhausted.

Does that mean that for people who nominate in the contracts to have their services managed through the NDIA, that they have safer protection against the services being stopped compared to others who may, for example, not pay their bills on time and be subject to the clause in the first paragraph?

MR DUGGAN:  I object.  The objection is this.  The witness is really being asked for a legal interpretation about a document that she hasn't prepared.  If she is being asked what the general practice is, that's fine, but there's a difference between that and what the document means legally.

CHAIR:  I rather understood the question to be directed to understanding of the practice, in light of the provisions in the contract.  Is that what you intended, Ms Eastman?

MS EASTMAN:  Yes.

CHAIR:  In that case, you can proceed on that assumption.  Do you understand the question?

 
MS CUDDIHY:  Can I just read the clause?  Would you allow me a couple of minutes to just read the clause?

MS EASTMAN:  Yes.

MS CUDDIHY:  I believe that is actually the interpretation of that clause.

CHAIR:  I think you are being asked about whether the clause indicates that, as a matter of practice, Sunnyfield preferred to have the NDIA be the intermediary for payment?

MS CUDDIHY:  No, I don't believe that is the case.  I will explain why, if I may?  Is that okay?

MS EASTMAN:  Go ahead.

MS CUDDIHY:  The NDIA are paying either     excuse me.

MS EASTMAN:  Take your time.

MS CUDDIHY:  The funding is from the NDIA, whether it's directly to Sunnyfield from the NDIA, whether it's self managed or whether it's to a plan manager.  I think what this clause is, and I could be corrected if I'm wrong, that there have been occasions when there have been gaps between a plan and there may have been, in certain circumstances, three or six months where there hasn't been funding readily available, but the person's plan is under review.  My understanding is it relates to that matter.  I don't believe it's meant to be discriminatory towards people who choose whichever model of funding.  And I believe that we have clients who make that choice on their own basis.  So I could be misinterpreting this wrong, but that's how I would have read the clause.

CHAIR:  Ms Eastman, as much as I would enjoy bearing with you for a further time, do you think we have come to the point where we can adjourn?

MS EASTMAN:  I just want to ask about clause 11 and clause 13 and then I will be at an end.  If I can just finish this contract, or would you prefer me to come back in the morning?

CHAIR:  Well, I am conscious Ms Cuddihy has been here all day.

MS EASTMAN:  We can deal with it tomorrow morning.

MS CUDDIHY:  If you would like, I'm quite happy to finish that off, if that makes it more convenient for the Commission?

CHAIR:  That's very kind of you, thank you.  I'm sure Ms Eastman will take you up on that.
 

MS CUDDIHY:  If I'm a bit croaky, I do apologise.

MS EASTMAN:  That's fine.

I want to ask you about clause 11, which is described as both ending and extending this agreement.

MS CUDDIHY:  Yes.

MS EASTMAN:  With respect to this agreement, I couldn't see that this agreement is described as an agreement for one year or two years.  It seems like an agreement, once it's entered into, that it will continue until it's ended.  Is that right?

MS CUDDIHY:  My read of it is that the way the NDIS plans operate is that this is a 12 month agreement and that it relates specifically to the person's NDIS plan period.  So that's my understanding of the agreement.  But I believe that it can, if people so wish, rather than every 12 months having to get a new agreement, that it is an agreement that can be extended and updated.  I certainly know that Eliza raises in her statement, which I very much agree with, the onerous nature of people with a disability who have a permanent and lasting impairment, to have to every single year renegotiate their NDIS plan.

MS EASTMAN:  The agreement with respect to ending says:

Either Party may end this agreement by giving at least 3 months' notice in writing at any time, or by giving 14 days' notice in writing if the other Party seriously breaches this agreement.

MS CUDDIHY:  Yes.

MS EASTMAN:  First of all, what do we understand to be a serious breach of this agreement?  What would trigger the 14 days' notice?

MS CUDDIHY:  I don't know.  I don't think we have ever triggered the 14 days’ notice.

MS EASTMAN:  With respect to the three months' notice, is it your understanding that that notice could be given for any reason?

MS CUDDIHY:  I believe it's in a situation where, at the end of the day, there is a view that it's no longer in the mutual interests of both parties to be involved in the contract.

MS EASTMAN:  But it doesn't say that, does it?

MS CUDDIHY:  No.  No, it doesn't.
 

MS EASTMAN:  Finally, on the feedback, complaints and disputes, that's on the next page, clause 13, that sets out:

Sunnyfield welcomes, values, and responds to all feedback.

MS CUDDIHY:  Yes.

MS EASTMAN:  Is that an aspiration or does Sunnyfield understand that to be a contractual obligation?

MS CUDDIHY:  I believe the vast majority of our staff do understand that as a contractual obligation.

MS EASTMAN:  Is that reflective from the NDIA standard clause, do you know?

MS CUDDIHY:  I couldn't answer that question.  As I've said before, I'm not totally abreast of our detailed contracts.  But, philosophically, that is something that I hold dear, our Board holds dear, our senior leadership team hold dear and that is something that we should have in practice in Sunnyfield, and I really value     we do have complaints, which we respect.  Our members actually asked us to specifically add feedback because they would like to be able to raise matters that they think are improvements or suggestions, and also the opportunity to raise praises.  So that is something that we should hold dear to and I am aware that that wasn't always the case, in particular to this house that is the subject of this Commission's inquiry, and I feel very     I do apologise that our organisation hasn't always lived in reality what we hold dear to our hearts.

MS EASTMAN:  Finally, at paragraph 15 or clause 15, do you understand that to be that:

If anything in this agreement conflicts with the NDIS rules, then this agreement will take effect as if it had been signed by each party without that provision.

Do you understand what that means?

MS CUDDIHY:  My understanding     and please, you're more skilled in this area than I am, but I believe that means this contract takes precedence over the NDIS in that area.  I could be incorrect.  I just need to read the clause.  Which clause was it again?

MS EASTMAN:  Clause 15.

MS CUDDIHY:  Thank you.  Without that provision, so it's saying that the NDIS rules take precedence.

MS EASTMAN:  Do you know what the NDIS rules were at the time this contract  
was signed?

MS CUDDIHY:  Off the top of my head, no.  I would have to go and see the document.

MS EASTMAN:  Do you know if those NDIS rules that the contract refers to were ever provided to Eliza at the time she signed the contract?

MS CUDDIHY:  I couldn't specifically tell you.  I couldn't answer that, in all honesty and faith.

MS EASTMAN:  Thank you.  Commissioners, I will cease there and we will resume.  We have some other contracts to deal with first thing in the morning.

CHAIR:  You would like Ms Cuddihy to return by 10 o'clock tomorrow morning?

MS EASTMAN:  Yes, please.

CHAIR:  Ms Cuddihy, just a couple of matters.  Can I suggest overnight, it's possible you may be asked about this, to check the contractual terms that were entered into that you have been taken to today with the standard forms to which you have referred in your evidence.  You have said on a number of occasions you're not sure whether the contract was to the same effect as the standard terms.  You might like to check that overnight.

MS CUDDIHY:  If I'm able to do that, I will do that.

CHAIR:  Thank you.  You might also like to check which firm or internal person provided the legal advice for the form of the contract with which we have been dealing.  I ask that question in part because the financial statements that cover the year 2016/2017 indicate that one of the directors, who is a partner of the law firm Clayton Utz, that that firm performed both paid and pro bono work.  Indeed, I think that appears as a related party transaction in each of the financial reports for the succeeding years.  So it would be helpful for the Commission to know who provided the advice, whether    

MS CUDDIHY:  This is in October 2016?

CHAIR:  Yes.  That's when the contract was    

MS CUDDIHY:  Are we in    

CHAIR:      entered into.  But, in any event, who provided the advice, bearing in mind that there do seem to have been services provided by Clayton Utz at that time.

Thank you very much for your attendance today.

 
I have received submissions from you, Ms Furness, on the question of the competence and compellability or otherwise of the Ombudsman.  The position that I would adopt is I would not propose of my own motion or the Commission's own motion to issue a summons to the Ombudsman to appear.  Whether that is something that is in issue for the purposes of the proceedings would depend upon whether a party represented here today seeks the issue of a summons for that purpose, and at present I do not know whether that is the case.  For obvious reasons, I do not want to be, or for the Commission to be, in the position of a contradictor.

Therefore, I need to know whether there is any party that seeks the appearance of the Ombudsman in the light of Ms Furness's indication that the Ombudsman wishes to argue that he is neither competent nor compellable as a witness in the Royal Commission.

MS EASTMAN:  Chair, can I indicate on behalf of Counsel Assisting that we will not ask you to issue a notice compelling the Ombudsman to attend.  But we do reserve our rights in our Counsel Assisting submissions to say something about the invitation, that remains an open invitation, to the Ombudsman to give evidence voluntarily.  And we reserve our rights to say something about his nonattendance with respect to anything arising in his statement.

CHAIR:  Mr Duggan, what is your position?

MR DUGGAN:  Chair, I don't have any instructions and I would need to seek instructions on that question.  Can I inquire as to this    

CHAIR:  Does this come as a blinding surprise to you?

MR DUGGAN:  No.  We would welcome the Ombudsman being here.

CHAIR:  What I suggest, Mr Duggan, is overnight you take some instructions and if you wish to object or to take a different view to that which has been taken by Ms Furness in the submissions filed on her behalf --- and no doubt she will give you a copy, if you don't have one already --- then you should provide some written submissions, presumably in opposition to the contentions that Ms Furness has raised, bearing in mind that those submissions raise a host of extremely interesting issues, which I'm sure you would wish to pursue with vigour.

MS EASTMAN:  Chair, Ms Furness provided those submissions to me and I have forwarded them to the Commissioners but I haven't provided a copy to any other party.

CHAIR:  Given Mr Duggan's position, it is obviously sensible for those submissions, and doubtless Ms Furness will provide Mr Duggan with a copy and to any other party who may wish to have a copy.  I'm sure the Commonwealth has a lively interest in how the Constitution of the Commonwealth of Australia operates.

 
MS EASTMAN:  Thank you, Commissioner.

CHAIR:  Thank you.  We shall adjourn to 10.00 am tomorrow.

THE HEARING ADJOURNED AT 4.22 PM UNTIL 10.00 AM ON THURSDAY, 27 MAY 2021