Adrian Cory Sloan as executor of the estate of the late Laurette Dorothy Keddie v Baldrey - [2018] WASC 206

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   ADRIAN CORY SLOAN as executor of the estate of the late LAURETTE DOROTHY KEDDIE -v- BALDREY [2018] WASC 206
CORAM:   MASTER SANDERSON
HEARD:   6 JUNE 2018
DELIVERED          :   17 JULY 2018
FILE NO/S:   CIV 2992 of 2017
BETWEEN:   ADRIAN CORY SLOAN as executor of the estate of the late LAURETTE DOROTHY KEDDIE
Plaintiff
AND
ANDREW BALDREY
First Defendant
KAY LORRAINE GARDINER
Second Defendant
TOBY BALDREY
Third Defendant
SAM BALDREY
Fourth Defendant
MARCIA JILL WALSH
Fifth Defendant
LIAM WALSH
Sixth Defendant
ELISE WALSH
Seventh Defendant

Catchwords:

Wills - Proper interpretation of will - Turns on own facts

Legislation:

Administration Act 1903 (WA)
Wills Act 1970 (WA)

Result:

Will interpreted

Category: B

Representation:

Counsel:

Plaintiff	:	No appearance
First Defendant	:	Dr J J Hockley
Second Defendant	:	No appearance
Third Defendant	:	No appearance
Fourth Defendant	:	No appearance
Fifth Defendant	:	No appearance
Sixth Defendant	:	Mr B D Campbell
Seventh Defendant	:	No appearance

Solicitors:

Plaintiff	:	No appearance
First Defendant	:	Hammond Legal
Second Defendant	:	No appearance
Third Defendant	:	No appearance
Fourth Defendant	:	No appearance
Fifth Defendant	:	No appearance
Sixth Defendant	:	Hale Legal
Seventh Defendant	:	No appearance

Case(s) referred to in decision(s):

Pringle v Pringle [2010] WASC 206
Re Baulkhorn (Unreported, QSC, 26 November 1993)
Re Hood [2004] VSC 328
Re Rowell (1982) 31 SASR 361
Re Willis [1996] 2 Qd R 664

MASTER SANDERSON:

There are three great evils which bedevil probate practice. The first and by far the most egregious is homemade wills. Second there is the problem occasioned by no will at all and the effects of the blunt instrument that is the Administration Act 1903 (WA). Third there are those cases where there is a will but the testator's circumstances have changed and the will has not been updated. This case is an example of the third category.
Before setting out the terms of the will I will recount the relevant facts. These facts are largely taken from a statement filed by the sixth defendant. In large measure they are uncontroversial. The deceased purchased a property at 83 Drabble Road, Scarborough in the 1980s. The plaintiff, a chartered accountant, was the deceased's accountant from approximately 1993 until approximately June 2012. The plaintiff was also the accountant for Diana Elaine Davies (Diana). Diana and the deceased lived together from the mid‑1970s. There is no evidence to suggest they were partners. They maintained separate finances at all times and it appears they simply enjoyed one another's company and lived together in an entirely platonic relationship.
On 2 October 2001 the deceased appointed the plaintiff as her attorney pursuant to an enduring power of attorney (the first POA). The first POA was subject to any declaration by the Guardian and Administration Board that the deceased had lost mental capacity. The plaintiff accepted the first POA on 4 October 2001. On 25 January 2005 the deceased made her last will. Probate was granted of this will after the death of the deceased.
The deceased sold the Drabble Road property on 27 March 2005 and ceased residing in that property. On or about 9 May 2005 the deceased purchased a property at Unit 2, 1 Kilpa Court, City Beach (the Kilpa Court property). The deceased remained the registered proprietor of that property until her death. Diana and the deceased lived at the Kilpa Court property between 2005 and 2011. In 2011 Diana was admitted to an aged care facility. The deceased continued to live in the Kilpa Court property. On 27 March 2012 the deceased appointed the plaintiff as her enduring power of attorney with no restrictions (the second POA). On 22 May 2012 the plaintiff accepted the second POA.
Throughout 2012 the deceased's health deteriorated. She was becoming increasingly frail and had a number of falls. It became clear she was not able to care for herself. At the urging friends and family she moved to an aged care facility known as Aegis Aged Care Stirling, Yokine (Aegis Yokine). It was the deceased's preference to remain in the Kilpa Court property but she was unable to do so. She moved into Aegis Yokine in June of 2012.
The deceased appears to have immediately regretted her decision to move. She telephoned friends and requested a move back to the Kilpa Court property. Such a move was not out of the question – although she was frail she was able to perform errands and leave Aegis Yokine to do so independently. But, friends and family saw any move back to the Kilpa Court property as unwise. In an attempt to assist the deceased's transition to the aged care facility the plaintiff arranged for Diana to move from the facility where she was resident to Aegis Yokine.
The plaintiff's reward for what appears to have been a very sensible and humane course was to be sacked both as the deceased's power of attorney and as her accountant. But the deceased remained in Aegis Yokine. The Kilpa Court property was vacant between June of 2012 and December 2012. As of 7 December 2012 the property was leased to assist with the deceased's costs of remaining in Aegis Yokine. Between 2012 and 2015 the deceased claimed the Kilpa Court property as her main residence for tax purposes as she was entitled to do. The deceased was diagnosed with kidney cancer and from June 2013 the deceased's health steadily declined. She passed away on 8 September 2015. Probate of the deceased's will was granted to the plaintiff on 10 November 2015.
Diana passed away on 16 November 2016. Probate of her estate was also granted to the plaintiff and this occurred on 20 April 2017.
There is no dispute between the parties as to the validity of the deceased's will or Diana's will.
It is cl 2 of the deceased's will which causes the difficulty. It is in the following terms:
I give my motor vehicle, my household chattels and my principal place of residence at my death to my friend Diana Elaine Davies of 83 Drabble Road, Scarborough, in the State of Western Australia.
If that disposition does not act to cover the Kilpa Court property then that property will fall into the deceased's residuary estate. The first to fourth named defendants' are the residuary beneficiaries of the deceased's estate. If, the clause acts on the Kilpa Court property then it will pass to the estate of Diana and the fifth through to seventh defendants' will benefit. (Only the sixth defendant took any active part in these proceedings). So, the question then is whether or not cl 2 of the deceased's will effectively disposes of the Kilpa Court property.
There are a number of legislative provisions which are relevant for present purposes. Section 26 of the Wills Act 1970 (WA) is in the following terms:
(1)Unless the contrary intention appears by the will ‑
(a)the will is to be construed, with reference to the property comprised in it, to speak and take effect as if it has been executed immediately before the death of the testator;
(b)property that is the subject of a disposition, other than the exercise of a power of appointment, that is void or fails to take effect is to be included in any residuary disposition contained in the will;
(c)a general disposition of land or of the land in a particular area includes leasehold land whether or not the testator owns freehold land;
(d)a general disposition of all the testator’s property or of all the testator’s property of a particular kind includes property over which the testator had a general power of appointment exercisable by will and operates as an execution of the power;
(e)a disposition of property without words of limitation whether to a person beneficially or as executor or trustee is to be construed as passing the whole estate or interest of the testator therein;
(f)a disposition of the residue of the estate of a testator, or of the whole of the estate of a testator, that refers only to ‑
(i)the real estate of the testator; or
(ii)the personal estate of the testator,
is to be construed to include both the real and personal estate of the testator;
(g)if any part of a disposition in fractional parts of the whole or of the residue of the estate of a testator fails, the part that fails accrues to the part that does not fail, and, if there is more than one part that does not fail, to all those parts proportionately.
(2) Subsection (1)(f) and (g) apply to the will of a person dying on or after the day on which section 19(1)(e) of the Wills Amendment Act 2007 comes into operation 1 , whether the will was executed or made before, on or after that day, and the will of a person who died before that day is to be construed as if section 19(1)(e) of that Act had not come into operation.
Section 28A of the Wills Act is also relevant. It reads as follows:
(1)In proceedings to construe a will, evidence, including evidence of the testator’s intention, is admissible to the extent that the language used in, or other content of, the will renders the will or any part of the will ‑
(a)meaningless; or
(b)ambiguous on the face of the will; or
(c)ambiguous in the light of the surrounding circumstances.
(2)Evidence of a testator’s intention is not admissible to establish any of the circumstances referred to in subsection (1)(c).
(3)Nothing in this section prevents evidence that is otherwise admissible at law from being admissible in proceedings to construe a will.
(4)This section applies to the will of any person dying on or after the day on which section 22 of the Wills Amendment Act 2007 comes into operation, whether the will was made or executed before, on or after that day, but does not apply to the will of a person who died before that day.
The principles of construction for the will were set out by Kenneth Martin J in Pringle v Pringle [2010] WASC 206 [25]. I would respectively adopt these principles without repeating them. They have been cited with approval in numerous cases in this court.
On behalf of the sixth defendant counsel both in his written and oral submissions relied extensively on the decision of Hollingworth J in Re Hood [2004] VSC 328. In that case his Honour was construing the phrase 'principal place of residence at the time of my death'. That phrase is marginally different to the wording at par 2 but nothing turns on that difference.
One of the matters which Hollingworth J dealt with was the significance of a tax return which claimed the relevant property as a principal place of residence. This was a matter on which some reliance was placed by the sixth defendant. His Honour said:
Counsel for the Halls submitted that I would be assisted by a consideration of cases on the meaning of 'principal place of residence' or 'principal residence' in the context of taxation and other revenue legislation. Various factors are considered in that context, including: whether it is the place the person actually resides; how often the person is present at the premises and spends the night there; whether the premises are used as a business; what connection they have with any other place of residence; where the person 'eats and sleeps and has a settled abode'; continuity of living arrangements; use of electricity and services; the presence of furniture. In stamp duty cases at least, it appears that the intention of the relevant person is a relevant, although not a dominant, factor in deciding the factual question as to whether or not a place can be described as a person's principal place of residence. In determining the issue, the Court 'has to make a common sense assessment taking into account a number of varying and even conflicting circumstances'.
Factors that may be relevant in the interpretation of revenue legislation may be less relevant in the context of interpretation of a will. Obviously, death often occurs at times when a person is seriously ill or incapacitated. At such a time, they may be in hospital or some other form of care. They may have been absent from their principal place of residence and in such care for a short or long time prior to their death. They may have lost full mental capacity at some time prior to their death. It would be undesirable if a testator's otherwise clearly expressed testamentary intention could be thwarted by the mere fact of hospitalisation or relocation from their customary abode prior to death [38] – [39] (footnotes omitted).
Hollingworth J did consider other relevant first instance decisions. These decisions include Re Rowell (1982) 31 SASR 361 and Re Baulkhorn (Unreported, QSC, 26 November 1993), (Derrington J). In my view both of these cases are distinguishable. In Re Rowell the property owned by the deceased had never been occupied by her and was left vacant for a two year period prior to her death. The court came to the conclusion that it would be undesirable if the testator's otherwise clearly expressed testamentary intention could be thwarted by the mere fact of hospitalisation or relocation from their customary abode prior to death. In Re Baulkhorn the deceased had sold one property and purchased vacant land. She had a house built on the land. As at the date of her death the house was constructed to 'lockup' stage. She had never occupied the property. Derrington J concluded the property represented a place of 'intended future residence'.
Of more relevance is the decision in Re Willis [1996] 2 Qd R 664. In that case Derrington J was considering the phrase 'the house property in which I shall be residing at the time of my decease'. At the time of death the deceased owned a house property in which she had last resided 13 years before. During the intervening period she had been in a psychiatric hospital and nursing homes. The house was left vacant throughout the period and her personal belongings were left there. For most of the 13 years she had lacked capacity to have any intention whether to reside in the house or not. Immediately prior to her death she was incapable of residing in the property or having the intention to do so.
His Honour held that a will should not be construed in a strictly technical or legalistic sense but with sensitivity to the factual context of ordinary circumstances and proper influence to special personal circumstances of the testator having a bearing on the meaning of an expression used in the will. Accordingly, the will should be construed as referring to the 'house which I shall keep and maintain as my residence though I cannot physically be there'.
Derrington J during the course of his judgment made the following observations:
It is a matter of general experience that some people suffer total incapacity in institutions away from their normal home for a long period immediately prior to death and the concept of their residence must be sufficiently flexible to accommodate this.
In such cases an expression in a will referring to the house in which the testator is residing at the time of death clearly could not be construed as applying only to a house in which there was continuing active daily occupation as a residence. A person of ordinary understanding and knowledge of the factual context would understand that, used in such circumstances in a will, the testator meant the words to carry more than the narrow meaning of the house of which he was or would be in physical occupation.
That is the position here. In the circumstances known to the testatrix, particularly the threat that at the time of her death she might have been confined to an institution permanently and because of arrangements she had made for the house, then at the time when she last had testamentary capacity it is plain that her expression, 'shall be residing at the time of my decease' should be sufficiently flexible to take into account her enforced physical absence (667).
In my view it is clear on the facts of this case that the Kilpa Court property was not the deceased's principal place of residence as at the date of her death. She was a resident of Aegis Yokine. True it is that when she moved into the aged care facility she was unhappy and initially at least she wished to move back to Kilpa Court. But she did not do so. The furniture that she had at the Kilpa Court property was sold. The deceased parted company with her much loved dog. The Kilpa Court property was leased out from December of 2012. While for tax purposes it may have been referred to as her principal place of residence that was clearly not the case. The fact that Diana moved into Aegis Yokine so she and the deceased could be together further confirms the move out of Kilpa Court was permanent.
Accordingly I am satisfied that the Kilpa Court property is not the subject of the disposition in cl 2 of the deceased's will. I will make orders accordingly and hear the parties as to costs.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
CA
ASSOCIATE
17 JULY 2018