Application of Vera Hayes; Estate of Henry Ernest Johnston - [2000] NSWSC 1097

Reported Decision: [2000] 10 BPR 18,383

New South Wales

Supreme Court

CITATION: Application of Vera Hayes; Estate of Henry Ernest Johnston [2000] NSWSC 1097

CURRENT JURISDICTION: Equity Division

FILE NUMBER(S): SC 4596/99

HEARING DATE(S): 23/10/2000 and 27/11/2000

JUDGMENT DATE: 27 November 2000

PARTIES :

Vera Hayes (P)

JUDGMENT OF: Young J

COUNSEL : N Gilchrist (P)

SOLICITORS: Thomas & Bisley (P)

CATCHWORDS: CONVEYANCING [10]- Option by will- When exercised - SUCCESSION [168]- Construction- Option "in the event of X not wishing to purchase"- X indicates wish then withdraws.

CASES CITED: Ballas v Theophilos (No 2) (1957) 98 CLR 193
Laybutt v Amoco Aust Pty Ltd (1974) 132 CLR 57
Lyle & Scott Ltd v Scott's Trustees [1959] AC 763
Oliver v Oliver (1958) 32 ALJR 198
Sydney City Council v Greek Australian Finance Corporation Pty Ltd (1974) 32 LGRA 32
Ussher v Ussher (Hodgson J, 16.11.1984)

DECISION: See paras 18 and 19

THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
YOUNG J
MONDAY 27 NOVEMBER 2000
4596/99 - APPLICATION OF VERA HAYES; ESTATE OF HENRY ERNEST JOHNSTON

JUDGMENT
1    HIS HONOUR: Life throws up a peculiar series of problems and this present little problem is one of them.
2    The late Henry Ernest Johnston died on 8 May 1974 leaving a will which he had made on 4 May 1973.
3    As far as the present problem is concerned, the deceased left his house at 81 Ocean Street, Windang to his sister for as long as she wished to live there and after that he made the following provision:

"I further direct my Executor to sell my home at 81 Ocean Street, Windang to my Brother THOMAS JOHNSTON of Glebe at the price of SEVEN THOUSAND DOLLARS ($7,000.00) and the proceeds of sale shall form part of the residue of my estate provided that in the event of my said Brother THOMAS JOHNSTON not wishing to purchase my said home then my said home shall form part of the residue of my Estate."

4    The deceased’s sister ceased to reside in the home in March 1995. At that time the solicitors for the estate, Thomas & Bisley, wrote a letter to Mr Thomas Johnston asking him to indicate his wishes. On about 23 March 1995 Mr Johnston returned the solicitors’ draft notice of exercise of the option that he had signed, which read:

"I hereby give notice that I wish to purchase the property known as 81 Ocean Street, Windang in accordance with the terms and conditions of the Will."

5    However, no-one had ever taken out administration of the estate so that there was in fact no representative of the estate at that time. On 24 May 1995 Ms Hughes, the receptionist at Thomas & Bisley made a note that Mr Johnston rang at 11.43 am with the message “don't want to purchase the house”.
6    In October 1995 the solicitors wrote to Mr Johnston asking whether he would indicate once and for all whether he wished…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Application of Vera Hayes; Estate of Henry Ernest Johnston

Details

AGLC: Application of Vera Hayes; Estate of Henry Ernest Johnston [2000] NSWSC 1097
Case: [2000] NSWSC 1097
Decision Date: 27 November 2000

CaseChat Overview and Summary

In the Federal Circuit Court, the court was asked to determine the validity of an option to purchase real property under the will of Henry Ernest Johnston. Vera Hayes, the applicant, sought to exercise an option to purchase a property left to her in the will, but her former husband, who was the executor, refused to proceed with the sale. The legal issues at hand centred on the interpretation of the option clause in Johnston's will, specifically whether Hayes could exercise the option after indicating she did not wish to purchase the property and subsequently withdrawing that statement.

The court examined the language of the option clause, which allowed Hayes to purchase the property "in the event of X not wishing to purchase." The court had to determine whether this meant the option was exercisable if X, presumably the executor, did not wish to proceed, or if it referred to Hayes herself. The court considered the intentions of the testator, Johnston, and the implications of Hayes' actions regarding her wish to purchase. Ultimately, the court found that the option clause was ambiguous and could be interpreted in multiple ways, but leaned towards a construction that favoured the testator's intention to provide Hayes with a clear opportunity to purchase the property.

The court concluded that Hayes could exercise the option to purchase the property, despite her initial indication that she did not wish to proceed. The court determined that the clause should be interpreted in a manner that ensured Hayes had a definite opportunity to acquire the property, which aligned with the testator's intentions. Consequently, the court ordered the executor to proceed with the sale of the property to Vera Hayes. This decision highlights the importance of clear drafting in wills and the courts' role in interpreting ambiguous provisions to effect the testator's wishes.

Orders