Bassett v Cameron

[2021] NSWSC 207

Supreme Court

New South Wales

• Summary available

Medium Neutral Citation:

Bassett v Cameron [2021] NSWSC 207

Hearing dates:

17-20, 24-25, 27 August 2020

Date of orders:

12 March 2021

Decision date:

12 March 2021

Jurisdiction:

Equity

Before:

Ward CJ in Eq

Decision:

1.   Dismiss the first cross-claim.

2.   Dismiss the second cross-claim with no order for costs.

3.   In addition to the bequest in the plaintiff’s favour under the deceased’s Will, order that there be further provision out of the estate of the late William Bassett in favour of the plaintiff, in the form of a one-half share of the deceased’s 50% share of the land known as The Springs, and that the burden of that bequest should be charged equally over the interests left to the plaintiff’s siblings in respect of the land; to the effect that the siblings’ interest in The Springs, as part of the residue of the deceased’s estate, is reduced to a 25% share of the land, to be held as between them in equal shares.

4.   Otherwise dismiss the amended statement of claim.

5.   Reserve the question of the costs of the amended statement of claim and first cross-claim.

6.   Direct that the parties file brief written submissions on the question of costs within 14 days, with a view to dealing with the matter on the papers if possible.

Catchwords:

ESTOPPEL – Proprietary estoppel – Encouragement – Detrimental reliance

SUCCESSION – Executors and administrators – Proceedings against executors and administrators

SUCCESSION – Family provision – Claim by adult child for provision from the deceased’s estate under Succession Act 2006 (NSW), Ch 3

Legislation Cited:

Civil Procedure Act 2005 (NSW)

Conveyancing Act, s 26(2)

Income Tax Assessment Act 1997 (Cth), s 70.100

Law Reform (Miscellaneous) Provisions Act 1946 (NSW), s 5

Limitation Act 1969 (NSW), ss 47(1)(c), 55

Partnership Act 1892 (NSW), ss 20, 21, 42, 43, 44

Succession Act 2006 (NSW), ss 59, 60

Trustee Act 1925 (NSW), ss 85, 93

Uniform Civil Procedure Rules 2005 (NSW), r 42.25(2)

Cases Cited:

Ashton v Pratt (2015) 88 NSWLR 281; [2015] NSWCA 12

Attenborough v Solomon [1913] AC 76

Atwell v Roberts (2013) 43 WAR 507; [2013] WASCA 37

Babu Lachmi Parshad v Maharajah Narendro Kishore Singh Bahadur [1891] UKPC 42

Barnes v Addy (1874) LR 9 Ch App 244

Barnes v Alderton (2008) 13 BPR 25,281; [2008] NSWSC 107

Baumgartner v Baumgartner (1987) 164 CLR 137; [1987] HCA 59

Baychek v Baychek [2010] NSWSC 987

Blendell v Blendell [2020] NSWCA 154

Burke v Burke (2015) 13 ASTLR 313; [2015] NSWCA 195

Cadbury Schweppes Pty Ltd v Darrell Lea Chocolate Shops Pty Ltd (No 4) (2006) 229 ALR 136; [2006] FCA 446

Caltex Refineries (QLD) Pty Ltd v Stavar [2009] NSWCA 258

Calverley v Green (1984) 155 CLR 242; [1984] HCA 81

Camernik v Reholc [2012] NSWSC 1537

Carly v Farrelly (1975) 1 NZLR 356

Clark v State of New South Wales (2006) NSWLR 648; [2006] NSWSC 673

Cobbe v Yeoman’s Row Management Ltd [2008] 1 WLR 1752

Commercial Bank of Australia v Amadio (1983) 151 CLR 447

Commissioner of State Taxation v Cyril Henschke Pty Ltd (2010) 242 CLR 508; [2010] HCA 43

Commonwealth of Australia v Verwayen (1990) 170 CLR 394; [1990] HCA 39

Cooper v Atkin [2020] NSWSC 828

Crossman v Sheahan [2016] NSWCA 200

Crown Melbourne Ltd v Cosmopolitan Hotel (Vic) Pty Ltd (2016) 333 ALR 384; [2015] HCA 26

Day v Perisher Blue Pty Ltd (2005) 62 NSWLR 731; [2005] NSWCA 110

Delaforce v Simpson-Cook (2010) 78 NSWLR 483; [2010] NSWCA 84

Delehunt v Carmody (1986) 161 CLR 464

DHJPM Pty Ltd v Blackthorn Resources Ltd (2011) 83 NSWLR 728; [2011] NSWCA 348

Dialog Pty Ltd v Addease Pty Ltd [2003] FCA 1359

Don King Productions Inc v Warren [2000] Ch 291

Donis v Donis (2007) 19 VR 577; [2007] VSCA 89

Doueihi v Construction Technologies Australia Pty Ltd (2016) 92 NSWLR 247; [2016] NSWCA 105

Duic v Duic [2013] NSWCA 42

Duke Group Ltd (in liq) v Alamain Investments Ltd [2003] SASC 415

E Co v Q [2018] NSWSC 442

Ellem v Webber [2020] NSWSC 910

Evans v Braddock [2015] NSWSC 249

Evans v Evans [2011] NSWCA 92

Fistar v Riverwood Legion and Community Club Ltd [2016] NSWCA 81

Flinn v Flinn [1999] 3 VR 712; VSCA 109

Galaxidis v Galaxidis [2004] NSWCA 111

Gerovich v Gerovich (as executor of the estate of Gerovich) [2018] WASC 153

Gillett v Holt [2001] Ch 210; [2000] EWCA Civ J0308-3

Giumelli v Giumelli (1999) 196 CLR 101; [1999] HCA 10

Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540

Grant v Edwards [1986] Ch 638

Green v Green (1989) 17 NSWLR 343

Grimaldi v Chameleon Mining NL (No 2) (2012) 200 FCR 296; [2012] FCAFC 6

Grundt v Great Boulder Pty Gold Mines Ltd (1937) 59 CLR 641; [1937] HCA 58

Hadlee v Commissioner of Inland Revenue [1989] 2 NZLR 447

Hampson v Hampson [2010] NSWSC 217

Harvey v Harvey (1970) 120 CLR 529; [1970] HCA 11

Hedley Byrne & Co Ltd v Heller & Partners Ltd [1963] 2 All ER 575

In Re Cockburn’s Will Trusts [1957] Ch 438

In Re Earl of Stamford [1896] 1 Ch 288

John Holland v Kellogg Brown Root Pty Ltd [2015] NSWSC 451

Joliffe v Fera [1973] 2 NSWLR 702

Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8

Kelly v Kelly (1990) 92 ALR 74

Lindsay Petroleum Co v Hurd (1873-4) LR 5 PC 221

Low v Bouverie [1891] 3 Ch 82

Lukin v Lovrinov [1998] SASC 6614

Macquarie Developments Pty Ltd v Forrester and Anor [2005] NSWSC 674

Malayan Credit Ltd v Jack Chia-MPH Ltd [1986] AC 549

McGrath v Troy as Administratrix of Estate of Wade [2010] NSWSC 1470

McNab v Graham (2017) 53 VR 311; [2017] VSCA 352

Miller Heiman Pty Ltd v Sales Principles Pty Ltd (2017) 94 NSWLR 500; [2017] NSWCA 106

Milling v Hardie [2014] NSWCA 163

Mineralogy Pty Ltd v Sino Iron Pty Ltd (No 6) (2015) 329 ALR 1; [2015] FCA 825

Moody Kiddell & Partners Pty Ltd v Arkell [2013] FCA 1066

Moore v Aubusson [2020] NSWSC 1466

Muschinski v Dodds (1985) 160 CLR 583; [1985] HCA 8

Mutual Life & Citizens’ Assurance Co Ltd v Evatt (1968) 122 CLR 556

Nicholas v Tubb [2016] TASSC 53

Nolan v Nolan [2015] QCA 199

O’Brien v Komesaroff (1982) 150 CLR 310

Orr v Ford (1988) 167 CLR 316

Page v Hull-Moody [2020] NSWSC 411

Payne v Parker [1976] 1 NSWLR 191

Pilotto v Cosoleto [2019] NSWSC 1454

Plunkett v Bull (1915) CLR 544; [1915] HCA 14

Poche v Poche (2020) NSWSC 835

Priestley v Priestley [2017] NSWCA 155

Q v E Co (2020) 383 ALR 469; [2020] NSWCA 220

Re Second East Dulwich Building Society (1899) 68 LJ Ch 196

Re Vandervell’s Trusts (No 2) [1974] 3 WLR 256; [1974] Ch 269

Reid v Hubbard [2003] VSC 387

RHG Mortgage Ltd v Ianni [2015] NSWCA 56

Rosebanner Pty Ltd v Energy Australia (2009) 223 FLR 406; [2009] NSWSC 43

Seamez v Mclaughlin [1999] NSWSC 9

Sgro v Thompson [2017] NSWCA 326

Shepherd v Doolan [2005] NSWSC 42

Sidhu v Van Dyke (2014) 251 CLR 505; [2014] HCA 19

Singer v Berghouse (1994) 181 CLR 201; [1994] HCA 40

Sivritas v Sivritas (2008) 23 VR 349; [2008] VSC 374

Stone v Stone [2019] NSWSC 233

Stone v Stone (2014) 17 BPR 33,443; [2014] NSWSC 1655

Sullivan v Sullivan (2006) 13 BPR 24,755; [2006] NSWCA 312

SZSJA v Minister for Immigration and Border Protection (2013) 308 ALR 266; [2013] FCAFC 158

Thorner v Major [2009] 3 All ER 945; UKHL 18

Toscano v Toscano [2017] NSWSC 419

Towson v Francis [2017] NSWSC 1034

Underwood v Gaudron [2014] NSWSC 1055

Van Dyke v Sidhu (2013) 301 ALR 769; [2013] NSWCA 198

Wantagong Farms Pty Ltd as Trustee for the Bulle Family Trust v Bulle [2015] NSWSC 1603

Watson v Foxman (1995) 49 NSWLR 315

Watton v MacTaggart [2020] NSWSC 1233

Webb v Ryan [2012] VSC 377

West v Mead (2003) 13 BPR 24,431; [2003] NSWSC 161

White v Philips Electronics Australia [2019] NSWCA 115

Williams v Nicoski [2003] WASC 131

Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515; [2004] HCA 16

Wyong Shire Council v Shirt (1980) 146 CLR 40

Yazbek v Commissioner of Taxation (2014) 98 ATR 943; [2014] AATA 423

Texts Cited:

Ben Macfarlane, The Law of Proprietary Estoppel (2014, Oxford University Press)

Feltham et al, Spencer Bower: Reliance-Based Estoppel (5th ed, 2017, Bloomsbury)

GE Dal Pont and KF Mackie, The Law of Succession (2nd ed, 2017, LexisNexis Butterworths)

Halsbury’s Laws of Australia

Heydon and Leeming, Jacobs’ Law of Trusts in Australia (8th ed, 2016, LexisNexis Butterworths)

Heydon, Cross on Evidence (7th Australian ed, 2004, LexisNexis Butterworths)

ICF Spry, Equitable Remedies (9th ed, 2014, Lawbook Co)

JD Heydon, MJ Leeming, PG Turner, Meagher, Gummow & Lehane’s Equity: Doctrine and Remedies (5th ed, LexisNexis, 2014)

K Handley, “Recent Cases” (2017) 91 Australian Law Journal 812

K Handley, Estoppel by Conduct and Election (2nd ed, 2016, Sweet & Maxwell)

Practice Note SC Eq 7

Category:

Principal judgment

Parties:

Geoffrey William Bassett (Plaintiff)
Sue Narelle Cameron (First Defendant)
Bruce Edward Bassett (Second Defendant)
Merilyn Jill Ryan (Third Defendant)

Representation:

Counsel:
M Hodge QC with JR Willis (Plaintiff)
J Needham SC (Defendants)

Solicitors:
Martin Legal (Plaintiff)
Keypoint Law (Defendants)

File Number(s):

2015/00019536

Publication restriction:

Nil

Judgment

1. HER HONOUR: Before me for hearing last August were various claims arising out of disputes between the four adult children of the late Elaine Jill Bassett (Jill), who died on 21 March 2007, and the late William Edward Bassett (Bill), who died on 22 January 2014.

2. Probate of Jill’s Will dated 17 June 1998 was granted to Bill and to one of their four children (the plaintiff, Geoffrey William Bassett (Geoff)), as co-executors of her estate, on 22 August 2007. Probate of Bill’s Will dated 14 May 2009 was granted on 18 December 2014 to another of the four children (the first defendant, Susan Narelle Cameron (Sue)) and to Geoff, as the co-executors named in Bill’s Will.

3. The second defendant, Merilyn Jill Ryan (Merilyn), is the eldest of Bill and Jill’s four children; followed by Sue, Geoff and the youngest of the siblings, Bruce Edward Bassett (Bruce) (the third defendant). Merilyn, Sue and Bruce are the residuary beneficiaries of both Jill’s estate and Bill’s estate, under their respective Wills, taking their interest in each of the residuary estates in equal shares. In these reasons, I refer to the family members by their first names, without intending any disrespect.

The proceedings

4. On 21 January 2015, Geoff commenced proceedings by statement of claim against Bill’s estate, naming Sue, his co-executor, as the first-named defendant (the primary proceeding). Geoff subsequently amended his claim and filed an amended statement of claim on 26 February 2015.

5. In the primary proceeding, Geoff seeks a declaration of trust in respect of Bill’s half share of a rural property in Inverell, New South Wales, known as “The Springs” (invoking the principles of proprietary estoppel) (see amended statement of claim at [3], [31]-[32]). Geoff says, in essence, that in about December 2008 and continuing in early 2009, Bill promised to devise his interest in The Springs to Geoff in his Will and that, in reliance on this promise (and subsequent representations), Geoff invested significant time and effort into the development of The Springs (in lieu of developing his consultancy business – at least on a full time basis). Ultimately, however, Bill’s interest in this rural property was devised to Geoff’s siblings as part of the residue of Bill’s estate. (I interpose to note that the pleaded claim, as Merilyn and Bruce emphasise, is predicated on an oral agreement alleged to have been reached at a much earlier time – namely, in 1984, and renewed in 2005 and again later.)

6. In the alternative, Geoff makes a claim for further provision from Bill’s estate pursuant to s 59 of the Succession Act 2006 (NSW) (Succession Act) (see amended statement of claim at [6]). It is accepted that if Geoff succeeds in his claim for a declaration of trust then his application for further provision from Bill’s estate becomes otiose.

7. Merilyn and Bruce, pursuant to leave granted on 3 February 2017, filed on 16 February 2017 a cross-claim, as representatives of Jill’s estate, seeking to restore assets to Jill’s estate on the basis that her estate was not properly administered by Jill’s executors (Geoff and Bill). That cross-claim (to which I refer as the first cross-claim) was amended on 1 July 2019.

8. Geoff and Sue are joined as the first and second cross-defendants to the first cross-claim. Geoff complains of the delay in commencement of this claim, which was not brought until after the death of Bill. First, Geoff says that he relied heavily on his father (Bill) during the administration of his mother (Jill)’s estate. Second, it is noted that a principal claim of the cross-claimants is that various assets held by the couple (that were treated in the administration of Jill’s estate as if they were held pursuant to a joint tenancy and so would have passed to Bill on her death by way of survivorship) were in fact assets of partnerships between Bill and Jill, with the consequence that Jill’s interest (through the said partnerships) in the assets ought to have formed part of the residue of her estate. Geoff says that the person best placed to give evidence as to that key factual issue would have been Bill.

9. On 31 August 2018, Geoff filed his own cross-claim against Bill’s estate (to which I refer as the second cross-claim) this being an admittedly defensive cross-claim in the event that Geoff has any liability arising under the first cross-claim. Sue is the named defendant to the second cross-claim in her capacity as co-executor of the estate.

10. Thus, the issues raised in the amended statement of claim arise out of the administration of Bill’s estate; whereas those in the two cross-claims arise out of the (much earlier) administration of Jill’s estate.

11. The position of Sue, who as noted was joined as a defendant in the primary proceeding (and cross-claims) in her capacity as an executor of Bill’s estate, is not uncomplicated. Pursuant to orders made by Pembroke J on 27 May 2019, Merilyn and Bruce were joined as parties to the primary proceeding and the second cross-claim (order 1) and appointed to represent the estate of Bill in both those proceedings (order 2). Pembroke J further ordered that Sue (in her capacity as an executor of Bill’s estate) would be at her own risk as to costs from 27 May 2019 (order 3). The effect of his Honour’s orders was that since then Merilyn and Bruce have had the conduct of the defence of the primary proceeding in lieu of Sue (his Honour having taken the view – albeit not on a final basis and expressly noting that it was not possible for him to test it at that stage – that Sue “has sympathised with the plaintiff [Geoff] and is clearly hostile towards her siblings Bruce and Merilyn as well as Bruce’s wife, Edwina” (see his Honour’s ex tempore reasons at p 5). I return to this issue in due course. Suffice here to say that any schism between the siblings on Sue’s part seems well and truly to be reciprocated on Bruce’s side.

12. Sue has since filed submitting appearances in each of the respective claims. Accordingly, the active parties in the proceedings are Geoff, on the one hand, and Merilyn and Bruce, on the other. However, Merilyn and Bruce have foreshadowed an application in due course as to Sue’s costs of the proceedings arising under s 93 of the Trustee Act 1925 (NSW) and/or r 42.25(2) of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR); namely, an application that Sue not be entitled to be indemnified for those costs, on the basis that those costs were unreasonably incurred. The issue of costs in general will be the subject of further submissions following this judgment.

Background

Family members

13. I have referred in the above introduction to the family members. Bill and Jill married in 1953 and were farmers. They had four children: Merilyn (born in 1955), Sue (born in 1957), Geoff (born in 1960) and Bruce (born in 1965). Geoff was the only child to take up a career as a farmer and worked alongside his parents in varying ways over the years.

14. Each of the four siblings gave evidence and was cross-examined in the proceedings. To the extent that the siblings’ personal circumstances are relevant to the family provision claim, those will be dealt with in more detail in due course.

Relevant partnerships

15. The various partnerships which feature in this matter are as follows.

16. First, Bill and Jill held equal shares in an unincorporated partnership known as WE Bassett & EJ Bassett trading as “Monowai Pastoral Co” (ABN 35 579 258 738) (The Monowai Partnership ). From inception, at the time of Bill and Jill’s marriage in 1953, to Jill’s death on 21 March 2007, Bill and Jill each held a 50% share in the partnership. After Jill’s death, Bill held 50% and the Estate of EJ Bassett held the other 50%. The Monowai Partnership ended on 30 June 2010. It is noted by Merilyn and Bruce that the ledgers of The Monowai Partnership do not record any final settlement of accounts as between the partners after Jill’s death, including for the interest that Jill’s estate held in the partnership; and that asset values are generally recorded at book value.

17. Second, an unincorporated partnership known as GW Bassett & KR Bassett trading as “GW & KR Bassett” (ABN 21 943 738 749), which commenced around the time of Geoff’s marriage to his now ex-wife, Kaye, in 1983 and in which the partners (Geoff and Kaye) held equal shares (The GW & KR Bassett Partnership).

18. Third, an unincorporated partnership known as WE Bassett, EJ Bassett & GW Bassett trading as “WJG Bassett partnership”, which commenced on or about 29 November 1984, in which the partners (Bill, Jill and Geoff) held the following shares: Bill and Jill each a 25% interest and Geoff the remaining 50% interest (The WJG Bassett Partnership). Merilyn and Bruce say that The WJG Bassett Partnership was the “original” Springs Partnership for the purchase of The Springs in 1985 (as to which, see below).

19. Fourth, an unincorporated partnership initially known as WE Bassett, EJ Bassett & GW Bassett & KR Bassett trading as “The Springs Pastoral Co”, which commenced on or about 1 July 1987 and in which the partners (Bill, Jill, Geoff and Kaye) held equal interests. This partnership changed its trading name to “The Springs Pindaroi Pastoral Co” (ABN 90 527 598 373) on or about 1 July 1988 (The Springs Partnership).

20. Merilyn and Bruce trace the iterations of The Springs Partnership as one operating: from 1987/88 as The Springs Pastoral Co (in the shares: Bill 25%, Jill 25%, Geoff 25%, and Kaye 25%); from 1988 to 21 March 2007 (the date of Jill’s death) as The Springs Pindaroi Pastoral Co (in the shares: Bill 25%, Jill 25%, Geoff 25%, and Kaye 25%); from 22 March 2007 to 31 March 2008 as The Springs Pindaroi Pastoral Co (in the shares: Bill 25%, Estate of EJ Bassett 25%, Geoff 25%, and Kaye 25%); and from 1 April 2008 to 15 April 2009 as The Springs Pindaroi – New Partnership (in the shares: Bill 25%, Estate EJ Bassett 25%, Geoff 25%, and Kaye 25%).

21. Merilyn and Bruce note that, unlike The WJG Bassett Partnership, The Springs Partnership from 1987/1988 did not include The Springs in the books of the partnership but, instead, noted a Property Purchase Advance in the names of Bill, Jill, and Geoff for the original purchase value of the land. It is noted that this change was contemporaneous with the introduction of Kaye as a partner in The Springs Pindaroi Pastoral Co. I address in due course the expert accounting evidence as to the treatment of the Property Purchase Advance in the partnership books. As with The Monowai Partnership, Merilyn and Bruce note that the partnership ledgers of The Springs Partnership do not record any final settlement of accounts as between partners after Jill’s death, including for the interest that Jill’s estate held in that partnership; and asset values are generally recorded at book value. It does not appear to be disputed that farming on The Springs was carried out over the relevant period by what may be referred to as the various iterations of The Springs Partnership; and it is Bill’s interest in The Springs that is the subject of Geoff’s proprietary estoppel claim.

22. Finally, Geoff and Bill held equal shares in an unincorporated partnership known as GW Bassett & WE Bassett trading as “WE & GW Bassett” (ABN 47 060 692 169) which operated from around April or May 2009 to 30 June 2015. The trading name for this partnership changed to “Bassett Grazing Co” on or about 5 January 2010 (The Bassett Grazing Co Partnership). After Bill died on 22 January 2014, the ledgers and Statement of Accounts of the partnership described the partnership as “Estate WE and GW Bassett trading as Bassett Grazing Co” and recorded Bill’s estate as holding a 50% share in the partnership.

15. It is noted that the relevant partnership ledgers indicate that the property of the last iteration of The Springs Partnership, including The Springs and the land at Hurricane Hill to which I will refer shortly, was transferred to The Bassett Grazing Co Partnership, on 16 April 2009.

16. Pausing here, Merilyn and Bruce submit that the best evidence as to the status of the assets of the relevant partnerships is to be found in the business records of the partnerships, including the records of the accountant for the respective partnerships at the time, Mr Alfred Carrigan (Mr Carrigan). However, Mr Carrigan has given evidence (to which I will turn in due course) casting doubt on how assets were recorded in the partnership accounts. I note that Mr Carrigan was also the accountant engaged by Geoff and Bill for the administration of Jill’s estate (but he was not Geoff’s personal accountant).

Dissolution of a partnership

25. At the outset, although there was reference in some of the evidence and submissions to the effect that The Springs Partnership continued in different forms (see, for example, the reference to Geoff’s October 2014 statements at [259] below), I understand this simply to be a shorthand reference to the continuation of the farming of The Springs through the various partnership iterations. As a matter of law, any change in the membership of a partnership operates to dissolve the partnership; and thereafter, if the business of the partnership is continued, a new partnership will have come into existence. On this point Halsbury’s Laws of Australia notes the following (vol 305, at [517]):

Because partnerships are contractual in nature, any change in the identity of the partners will automatically dissolve them. If the business is to continue under the management of some or all of the existing partners, with or without any new partners, that will occur under a new partnership, the old one having terminated as a result of the change.  The partners cannot avoid that consequence by making contrary provision in their partnership agreement. The changes in the composition of a partnership that have that effect include changes as the result of the death, expulsion or retirement of a partner or the introduction of a new partner. [footnotes omitted]

26. The explanation by Eichelbaum CJ in Hadlee v Commissioner of Inland Revenue [1989] 2 NZLR 447 at 455 which was relied on by the High Court in Commissioner of State Taxation v Cyril Henschke Pty Ltd (2010) 242 CLR 508;[2010] HCA 43 at [11] makes this clear:

In law the retirement of a partner, or the admission of a new partner, constitutes the dissolution of the old partnership and the formation of a new one. Here, upon the happening of such events there were no overt signs of dissolution; the partnership's financial structure and arrangements were such that none was required but that does not alter the underlying legal significance of any retirement or new admission: Inland Revenue Commissioners v Gibbs [1942] AC 402, particularly per Viscount Simon LC at p 414, Lord Wright at pp 429 and 430 and Lord Porter at p 432; Brace v Calder [1895] 2 QB 253, per Lord Esher MR at p 258, Lopes LJ at p 261, and Rigby LJ at p 263; Lindley on Partnership (15th ed, 1984) pp 543, 983. Nor, in my opinion, is it possible to avoid those legal propositions by the terms of the partnership agreement: no doubt it is competent for partners to agree in advance that in the event of a retirement the remaining partners will continue to practise in partnership but that does not overcome the consequence that the partnership practising the day after the retirement is a different one from that in business the previous day.

27. Similarly, in Atwell v Roberts (2013) 43 WAR 507; [2013] WASCA 37, where new partners were added to a family partnership, known as the “Atwell Family Agency”, on six occasions, Pullin JA said at [11]:

(a)   it is an axiom of partnership law that any change in the membership of a partnership occurring, whether by reason of the retirement, expulsion, death or otherwise of a partner has the consequence of dissolving the partnership: SJ Mackie Pty Ltd v Dalziell Medical Practice Pty Ltd [1989] 2 Qd R 87 at 90–91;

(b)   after dissolution, the next step is to wind up the affairs of the partnership by realising the assets and paying the debts and liabilities of the firm before distributing the surplus, if any, among the partners according to their rights and interests: Partnership Act 1891 (Qld) s 42; Rushton (Qld) Pty Ltd v Rushton (NSW) Pty Ltd [2002] QCA 210; [2003] 1 Qd R 320, 323;

(c)   winding up in that way may be avoided if the parties agree on a sale to one or more of the remaining partners of the share of the outgoing partner or if there is a provision in the partnership agreement to that effect. This is sometimes described as a technical or notional dissolution which is something of a misnomer because it is not the dissolution, but rather the winding up, that is notional. In those circumstances, the partnership or firm itself is dissolved as soon as there is a change in membership, but the assets and, as between the partners, responsibility for the liabilities of the partnership are taken over by the remaining partners: Rushton Commissioner of State Taxation of the State of South Australia v Cyril Henschke Pty Ltd [2010] HCA 43; (2010) 242 CLR 508 [12]; Fazio v Fazio [2012] WASCA 72 [65];

…

Properties

28. Relevantly, the real property which features in the present proceedings comprises the following properties: Dunoola, the first rural property farmed by Bill and Jill after their marriage (Dunoola); Pindaroi, the family property ultimately acquired by Geoff and Kaye (as to which, the constant refrain of Merilyn and Bruce was that this was acquired at a significant undervalue and which the siblings understood to represent Geoff’s “early inheritance”) (Pindaroi); The Springs, a farm near Inverell, New South Wales, which was purchased by Bill, Jill and Geoff on 26 March 1985 (The Springs); Hurricane Hill, farmland contiguous to The Springs, which was purchased in the names of Bill, Jill, Geoff and Kaye (together as tenants in common but, as between each of the couples, as joint tenants) on 12 August 2005 (Hurricane Hill); and Bassett Downs, a parcel of land near Inverell, which was purchased by Bill and Jill in about 1992, and subdivided into residential properties in several stages between 1994 and 2006 (Bassett Downs) (see below).

Bassett Downs

29. It is convenient here to note the relevant chronology in respect of the development of Bassett Downs. After its acquisition by Bill and Jill in 1992, Bassett Downs was sub-divided into 32 lots during the 1990’s (Geoff’s affidavit sworn 8 June 2017 at [160]-[162]). A copy of deposited plan (DP) 876448 (being the deposited plan referred to in Jill’s Will) shows the sub-division of the property into those 32 lots (Geoff’s affidavit sworn 18 October 2018, Ex C at Tab 60). This plan was registered on 22 April 1998.

30. Lots 1 to 30 were sold prior to Jill’s death. There is no dispute in relation to those lots.

31. In 2006, Lot 32 was subdivided into a further 26 lots (the Sub-Lots) (as recorded in DP1093499) (Geoff’s affidavit sworn 8 June 2017 at [165]). 25 of the 26 Sub-Lots were put up for sale. At the time of Jill’s death on 21 March 2007, 13 of the Sub-Lots had been sold, leaving the 13 remaining Sub-Lots and Lot 31 unsold (Geoff’s affidavit sworn 8 June 2017 at [162]-[164]).

32. Eight of the remaining Sub-Lots were sold after Jill’s death but prior to Jill’s estate being finalised (the Claim 8 Lots). As noted above, DP876448 (referred to in Jill’s Will) was registered on 22 April 1998. On 24 February 2006, DP1093499 (being the deposited plan for Bassett Downs referred to in the first cross-claim at [63]) was registered (Geoff’s affidavit sworn 18 October 2018, Ex C at Tab 61). DP1093499 identifies the “Last Plan” in respect of the Bassett Downs land as “DP1066097 (DP876448)”. Geoff places weight on the fact that DP1093499 discloses that each of the Claim 8 Lots (the subject of Claim 8 of the first cross-claim) formed part of Lot 32 under DP876448. Accordingly, it is said that each of the Claim 8 Lots formed part of the land devised under cl 6(b) of Jill’s Will, which reads:

6.   I GIVE AND BEQUEATH to my said son Geoffrey William Bassett the following property:

…

(b)   An one quarter share of my share in the remaining part of the real estate purchased by me and my said husband from the Estate of the late James Lauder comprising 18.69 hectares or thereabouts and being Lots 1 to 32 inclusive (excluding Lot 8) in Deposited Plan 876448.

[Emphasis in original]

33. Five Sub-Lots remained unsold at the time Jill’s estate was finalised (being Sub-Lots 2, 11-13, 20). These five Sub-Lots (the Claim 9 Lots) are the subject of Claim 9 of the first cross-claim (see below Geoff says that, similarly to the Claim 8 Lots, DP1093499 discloses that each of the Claim 9 Lots formed part of Lot 32 under DP876448 and each was, therefore, part of the land devised under cl 6(b) of Jill’s Will.

34. As noted above, Lot 31 had not been sold at the time of Jill’s death. Sub-Lot 26 remained undeveloped at the time Jill’s estate was finalised. Lot 31 and Sub-Lot 26 are relevant to Claim 10 (see below).

Hurricane Hill

35. The transfer records show that Hurricane Hill was acquired in 2005 by the four partners of The Springs Partnership as tenants in common (as to 50% by Bill and Jill as joint tenants, and as to 50% by Geoff and Kaye as joint tenants). It is noted by Merilyn and Bruce that Hurricane Hill was included in the books of The Springs Partnership as a partnership asset. After Jill’s death, Bill became owner of 50% of Hurricane Hill by way of survivorship. By Claim 4 of the first cross-claim, Merilyn and Bruce contend that this share should have been treated differently – i.e., as a partnership asset. Kaye subsequently transferred her 25% share of Hurricane Hill to Geoff on 23 November 2009, as part of their property settlement.

36. As adverted to, there is a dispute as to the nature of the interests held in Hurricane Hill; namely, whether this land was purchased as a partnership asset of The Springs Partnership (as contended by Merilyn and Bruce) or, alternatively, whether (as Geoff contends) Hurricane Hill was owned by the partners individually in their own right and that the partnership concerned the working (not ownership) of this land (see further below).

Wills

Jill’s Will

37. Bill made a Will in 1992 (and, as I understand Bruce and Merilyn’s submissions, Jill made a mirror 1992 Will). Bill and Jill then made mirror Wills in 1998, which did not leave The Springs to Geoff.

38. Mr John Butler of Borthwick & Butler solicitors, Inverell drafted Jill’s final Will dated 17 June 1998. Probate of the Will was granted to Bill and Geoff on 22 August 2007. Its terms reflected those of Bill’s 1998 Will.

39. In summary, after gifts of jewellery to Merilyn and Sue, Jill left her principal residence or any share of it at the time of her death to Bill, along with cars, chattels, and two shop properties at Coffs Harbour (a gift which it is noted lapsed as they were not owned by Jill at her death, or at all). Jill also left to Bill any interest she had in any loans owed jointly by Geoff and Kaye.

40. Jill left equipment and plant on the family farm, Pindaroi, and a one-quarter share of her share in the remainder of Bassett Downs (being Lots 1 to 32, excluding Lot 8) (this bequest including the Claim 8 Lots and Claim 9 Lots). The residue of Jill’s estate was left to Merilyn, Sue and Bruce as tenants in common in equal shares.

41. Pausing here, it is noted by Merilyn and Bruce that, as Bill has now died, Geoff remains the sole surviving executor of Jill’s estate. They point to authority that, on the death of an executor, “the office, with its incidents, duties and powers, and the estate and interest in all the property vested in the representatives by virtue of their office, devolve, upon the survivors or survivor” (Joliffe v Fera [1973] 2 NSWLR 702 at 703 per Holland J quoting Halsbury’s Laws of Australia, 3^rd ed, vol 16, at [218]). Although the complaint in the first cross-claim is as to breach by Geoff in respect of his “executorial duties”, it was clarified in opening submissions that there is no claim here being made in devastavit (which, it is accepted, would be statute-barred) (T 11.10-20). Rather, the complaint is said to be maintainable as a claim to recover trust property or the proceeds of trust property (see T 14.40-16.15). There is no pleading of fraud or breach of trust.

Bill’s Will

42. Bill’s final Will, dated 14 May 2009, was also drafted by a solicitor at Borthwick & Butler (this time, Mr Mike Manuel (Mr Manuel)), who witnessed its execution along with his clerk. At least two drafts of the Will were prepared; and Bill attended the solicitors in person to give instructions in relation to the Will. Probate of this Will was granted to Geoff and Sue on 18 December 2014.

43. After appointment of executors, by cl 3 of the Will, Bill gave to Geoff his interest in any:

farming plant and equipment, machinery, implements, and livestock together with my interest in any farming and grazing Partnership of which the said Geoffrey William Bassett is also a partner BUT EXPRESSLY EXCLUDING any real estate which I may own with the said Geoffrey William Bassett at the date of my death.

[Emphasis in original]

44. It is emphasised by Merilyn and Bruce that this clause operates to exclude Bill’s interest in The Springs (which Geoff claims was the subject of the express agreements and representations pleaded in his amended statement of claim).

45. Clause 4 of Bill’s Will gives the residue of the estate (which, by operation of cl 3, includes Bill’s share in the real estate Bill owned together with Geoff) to Merilyn, Sue and Bruce, as tenants in common.

Chronology of events

Monowai Partnership

46. As already noted, The Monowai Partnership commenced in 1953 when Bill and Jill married. At that time, Bill and Jill first carried on farming together at Dunoola. Their four children were born in 1955, 1957, 1960 and 1965. Bill and Jill retained Dunoola until 2004.

Purchase of Pindaroi - 1976

47. In 1976, Bill and Jill purchased the rural property known as Pindaroi Station (Pindaroi) for the sum of $234,000 (see Geoff’s affidavit affirmed 30 March 2015 at [9]); Sue’s affidavit sworn 22 July 2015 at [8]). Pindaroi, about 40km from Inverell, became their family home. Bill and Jill moved into the homestead on Pindaroi in 1977 with Geoff and Bruce (Merilyn and Sue by then having left home). Merilyn and Bruce point out that Pindaroi was recorded as an asset of The Monowai Partnership. However, the transfer records that Bill and Jill acquired the land as tenants in common in equal shares (Sue’s affidavit sworn 22 July 2015, Ex A at 3). Bill and Jill continued to own and operate Dunoola at that time.

Geoff leaves school and commences work on Pindaroi - 1977

48. Geoff, who as noted above was the only sibling who undertook a career as a farmer, left high school in 1977 and commenced working as a farm hand on Pindaroi (Geoff’s affidavit affirmed 30 March 2015 at [10]-[11]). Geoff’s evidence is that Bill influenced his decision not to go to university at the time. Geoff alleges that, from 1977 to 1983, he worked on Pindaroi for a varying award wage, for 40 hours per week (amended statement of claim at [4]). Merilyn and Bruce point out that Geoff had free board and lodgings on Pindaroi and that his wages were paid by The Monowai Partnership.

Geoff’s lease of the Woolshed Block - 1978

49. Geoff’s evidence is that, in 1978, he entered into an oral agreement with his parents to lease, at a commercial rate, a 161 hectare portion of Pindaroi, being the “top end” of Pindaroi known as the “Woolshed Block” (Geoff’s affidavit affirmed 30 March 2015 at [13]-[14]); Geoff’s affidavit affirmed 8 December 2015 at [2]). Geoff alleges that he leased the top end of the Woolshed Block from 1977 to 1983 at a commercial lease rate (amended statement of claim at [5]). In that time, he says that he improved the land by, inter alia, putting up new fences, clearing dead timber and rocks, contouring and cultivating arable soil and controlling annual and woody weeds (Geoff’s affidavit affirmed 30 March 2015 at [15]). Geoff says that he was not paid any amount for his work associated with improving the value of the land (Geoff’s affidavit affirmed 30 March 2015 at [14]). He continued to be paid award wages working on Pindaroi, with board and lodgings.

50. By reference to the Monowai Statements of Account from 1979 to 1982, Merilyn and Bruce point out that Geoff received loans in varying amounts over the period (see Bruce’s affidavit sworn 28 September 2015 at [26]-[29]). Geoff says he used those loans to pay for some of his parent’s farming equipment at written down book value and that he repaid the loans (Geoff’s affidavit affirmed 8 December 2015 at [23]; Geoff’s affidavit sworn 8 June 2017 at [50].

Geoff’s purchase of Woolshed Block (part of Pindaroi) - 1983

51. Geoff married Kaye in 1983. Geoff and Kaye moved into the Cottage on Pindaroi. Merilyn and Bruce point out that they lived there rent-free for eight years (Bruce’s affidavit sworn 28 September 2015 at [29]).

52. Geoff’s evidence is that, at that time, Bill and Jill offered to sell the whole Woolshed Block to him (Geoff’s affidavit affirmed 30 March 2015 at [17])) and that, ultimately, Geoff purchased this land for $145,214 (Geoff’s affidavit affirmed 30 March 2015 at [18]; Sue’s affidavit sworn 22 July 2015 at [11]). Bruce notes that the transfer for the Woolshed Block excludes the portion where the shearing shed and yards were located, which Bill and Jill continued to own (see Bruce’s affidavit sworn 26 April 2018 at [219]-[220]). By contrast, Geoff’s evidence is that his parents’ offer of the Woolshed Block was on the condition that Bill could continue to use those areas when required, without any money being payable for use of those facilities (see Geoff’s affidavit sworn 8 June 2017 at [62]).

53. Merilyn and Bruce say that the Monowai Statements of Account 1983/1984 show that, before the Woolshed Block was transferred to Geoff, Bill and Jill had invested $70,134 in Pindaroi over the period from 1976 to 1984, increasing the cost value of Pindaroi from $234,000 in the 1976 financial year to $304,164 by the 1984 financial year (Bruce’s affidavit sworn 28 September 2015, Ex 4 at pp 81-101).

54. The purchase of the Woolshed Block was effected by way of vendor finance – a loan which, following a debt forgiveness in the amount of (at least) $30,000, was repaid in six years (Geoff’s affidavit affirmed 30 March 2015 at [18]-[19]). It is Geoff’s understanding that the debt forgiveness was partly an acknowledgement of the capital improvements he had made to the Woolshed Block during the course of his lease of the property (Geoff’s affidavit affirmed 30 March 2015 at [18]; Geoff’s affidavit affirmed 8 December 2015 at [26]) and partly because Bill unilaterally decided artificially to inflate the price (as the property was purchased prior to the introduction of Capital Gains Tax and the inflated price would assist Geoff with minimising any future Capital Gains Tax liability if he decided to sell the property in due course) (Geoff’s affidavit sworn 8 June 2017 at [59]).

55. Geoff concedes that it is possible that his parents provided an additional gift of $45,200 (by way of a release of debt) but does not have an actual recollection of this (Geoff’s affidavit affirmed 8 December 2015 at [4], [26]). In this regard, it is noted that a handwritten note prepared by Bill in 2013 (the so-called Shopping List Note – as to which see further below) appears to reflect this position (Sue’s affidavit sworn 22 July 2015, Ex A at p 29 (the Shopping List Note)). Geoff recalls paying interest at a commercial rate on the loan (Geoff’s affidavit affirmed 8 December 2015 at [27]).

51. Merilyn and Bruce say that there were total loan repayments over the period from 1986 to 1989 of $70,014 in respect of the purchase price of $145,214, the balance being “gifted” to Geoff from The Monowai Partnership (referring to Monowai Statements of Account over the period which record gifts to Geoff of $30,000 and $45,200 and a loan of $115,214).

52. Following his purchase of the Woolshed Block, Geoff continued to work on Pindaroi (including the part of Pindaroi that was still owned by his parents) but was no longer paid for this work. This work included, inter alia, operating the harvester and driving grain trucks at harvest time, undertaking welding jobs, wool classing at shearing time, dealing with property fencing, conducting general maintenance and designing and building sheep yards (Geoff’s affidavit affirmed 30 March 2015 at [20]-[21]). Accordingly, Geoff submits that he undertook a significant amount of unpaid labour for his parents over a number of years. Merilyn and Bruce point out that he took the profits from farming the Woolshed Block (and I note that, at least by the time Geoff was in partnership with his parents, so it seems not surprising that his remuneration might have been by partnership drawings rather than wages as such).

53. I interpose here also to note that Geoff’s evidence is that, in the period since 1983, he worked to develop innovative farming techniques (through conducting courses and experimenting); and that, in 1988, he won an inaugural farm management competition (Geoff’s affidavit affirmed 30 March 2015 at [59]); and, in 1993, he won “The Champion of Champions” title (Geoff’s affidavit sworn 8 June 2017 at [551]-[552]). Geoff says that he developed an excellent reputation as a soil consultant (Geoff’s affidavit affirmed 30 March 2015 at [61]). Geoff’s evidence is that he has also become a regular workshop presenter to groups of farmers in Northern NSW and Southern Queensland and that he has presented alongside internationally known soil consultants such as Professor Don Huber (Geoff’s affidavit sworn 8 June 2017 at [563]-[564]).

Purchase of The Springs - 1984

59. Returning to the chronology, in 1984, Geoff, Bill and Jill together purchased The Springs for the sum of $288,539 (Geoff’s affidavit affirmed 30 March 2015 at [22]); Bruce’s affidavit sworn 28 September 2015 at [41], Ex 4 at pp 53-54 - the Agreement for Sale of Land dated 29 November 1984. The transfer (dated 26 March 1985) records the purchase price as being $228,539.05 (Bruce’s affidavit sworn 28 September 2015, Ex 4 at p 103). The title documents record the owners as being Bill as to 25%, Jill as to 25% and Geoff as to 50%, all as tenants in common.

60. Geoff’s evidence is that, although The Springs was half owned by Bill and Jill, he (Geoff) completed or organised a majority of the work on the property without compensation (Geoff’s affidavit affirmed 30 March 2015 at [26]). As noted above, at about this time The WJG Bassett Partnership was formed.

61. The purchase of The Springs was financed by way of debt: a $100,000 loan from The Monowai Partnership to The WJG Bassett Partnership; a $168,000 loan from the National Australia Bank (NAB) to Bill, Jill and Geoff (with Bill and Jill as guarantors); and a $26,511 overdraft facility from NAB to The WJG Bassett Partnership (Expert Report dated 13 September 2019 of Antony Bryn Samuel (the Samuel Report), Ex E at [150]).

62. It is said by Geoff that, as the proprietors of The WJG Bassett Partnership were Bill (with a 25% interest), Jill (with a 25% interest) and Geoff (with a 50% interest), their respective contributions via debt were equivalent to their respective ownership interests in the partnership.

63. Merilyn and Bruce point to The Springs Partnership records showing the purchase value at $289,972 (see Expert Report dated 26 March 2019 of Hugo Charles Loneragan (the Loneragan Report), Ex 6 at [4.2.1]-[4.2.2]). They point out that, at the time of the purchase, Geoff was in debt to Bill and Jill for the Woolshed Block and for the purchase of livestock for the farm (referring to the statements of account for both the Monowai and WJG Bassett Partnerships). They also say that Geoff did not contribute any funds to purchase The Springs. However, this does not seem to take into account the NAB loan, which (at least in a resulting trust context) would be treated as a contribution to the purchase price by Geoff of a share of the borrowed funds (see Calverley v Green (1984) 155 CLR 242; [1984] HCA 81).

Alleged representation re The Springs – 1984

64. In the amended statement of claim, Geoff alleges that, at the time of the purchase of The Springs, he and Bill entered into an oral agreement (see amended statement of claim at [13]-[14]) on terms that included a representation that Geoff would inherit Bill’s share of The Springs (see further below).

65. It should be noted that there is no claim here made in contract by Geoff and that, ultimately, in submissions at the hearing Geoff did not place weight on the alleged agreement or representations made by Bill (whether in 1984 or later) until the representation(s) allegedly made in 2008/2009. However, Merilyn and Bruce say, in effect, that the 1984 allegations are central to the pleaded case and that Geoff’s case should fail if those allegations are not made good. (Both sides, albeit in different contexts, say that the other should be held to the pleaded case. At least in this, therefore, they are in furious agreement.)

66. Geoff’s evidence is that he and Kaye intended to buy Bill and Jill’s 50% share of The Springs after he repaid the loans he owed for the purchase of the Woolshed Block and for his half of The Springs (see Geoff’s affidavit sworn 8 June 2017 at [86], [107]). (Merilyn and Bruce place reliance on this as being inconsistent with Geoff’s pleaded claim that from 1984, he relied on an oral agreement or representation that he would inherit The Springs.)

1987/1988 – partnership changes

67. As noted above, in 1987 and 1988 there were changes to the partnership structures in place among the family members.

68. Bruce deposes that, in the financial year ending 20 June 1987, Geoff sold a 25% interest in The Springs Partnership (then trading as The Springs Pastoral Co) to Kaye, with a loan from the partnership (see Bruce’s affidavit sworn 28 September 2015 at [43](b)).

69. In the 1988 financial year, The WJG Bassett Partnership came to an end. By then, the Springs Pastoral Co partnership was formed (with each of the four partners – Bill, Jill, Geoff and Kaye – having a 25% share).

70. Merilyn and Bruce point out that there was no winding up or settlement of accounts for The WJG Bassett Partnership and that the assets recorded in relation to livestock and equipment were identical in the Springs Pastoral Co partnership accounts with minimal changes to Bill and Jill’s capital accounts.

71. Relevantly, however, The Springs was not recorded in the Springs Pastoral Co accounts. Rather, there was an entry in the accounts for a “Property Purchase Advance WE, EJ and GW Bassett” in the sum of $245,974 (which increased to $289,974 in the 1989 financial year). In their concurrent evidence at the hearing, the two accounting experts (Mr Antony Samuel and Mr Hugo Loneragan) agreed that the Property Purchase Advance there recorded was a receivable (or asset) in the books of The Springs Partnership and represented a debt owed by Bill, Jill and Geoff to the partnership. Further, Mr Loneragan accepted in cross-examination that he had not in his calculations accounted for Jill’s debt to The Springs Partnership in this regard. He accepted this would require an adjustment of some $72,000 in the amount claimed by Merilyn and Bruce to be owing to Jill’s estate (T 474.37-475.2; T 489.21-39).

Gifts to Sue in and after 1989

72. Sue has deposed in her affidavit sworn 22 July 2015 at [45] that Bill and Jill gave her a gift of $10,000 in May 1989 and a further gift of $50,000 some time after 1989.

Gift to Bruce in 1990

73. Bruce has deposed in his affidavit sworn 28 September 2015 (at [20](a)) that in early 1990 Bill and Jill gave him around $6,000 and he travelled overseas in 1991.

Lease of balance of Pindaroi - 1990

74. In early 1990, Bill and Jill ceased living at Pindaroi and moved into town in Inverell (Geoff’s affidavit affirmed 30 March 2015 at [33]); Geoff’s affidavit sworn 8 June 2017 at [122]) and Geoff and Kaye moved into the Pindaroi homestead. Geoff says that, at about this time, Bill offered to lease him the remainder of Pindaroi to Geoff (being the part of Pindaroi which was not the Woolshed Block) and that Bill told him that “…one day you will inherit this land from us…” (Geoff’s affidavit affirmed 30 March 2015 at [34]). Bruce on the other hand attributes to Jill a statement that “Geoff wants to take over Pindaroi. So we’ve been forced off” (see Bruce’s affidavit sworn 28 September 2015 at [71). I interpose to note that I was taken to nothing to corroborate the suggestion that Bill and Jill did not voluntarily decide to move into Inverell; i.e., that they felt they were being “forced off” the land.

75. Geoff deposes that he and Kaye agreed to lease Pindaroi (Geoff’s affidavit affirmed 30 March 2015 at [36]); and that he paid a commercial or market rent to use the land from 1990 to 1998 (see Geoff’s affidavit affirmed 30 March 2015 at [36]; Geoff’s affidavit sworn 8 June 2017 at [138]). Bruce disputes that Geoff paid his parents rent to lease the land (see Bruce’s affidavit sworn 28 September 2016 at [75]). Merilyn and Bruce note that no lease documents have been produced; nor is there a payment for Pindaroi rent in the accounting records. In the defendants’ chronology, Merilyn and Bruce have put a figure on the total rent (calculated at 5% of the land value) that they argue would have been payable, averaging out the property price from 1990 to 1998 (a figure of $310,000), which it appears that they contend was waived for Geoff’s benefit (see, for example, item 79 of the defendants’ chronology). Geoff, however, deposes in his affidavit sworn 8 June 2017 (at [154]) that there was a renegotiation as to the rent from about 1991 so that instead of paying rent he and Kaye were responsible for the maintenance and improvement of the property and in his earlier affidavit evidence he estimates that in the time he leased and lived on Pindaroi he invested approximately $300,000 into improving the property (Geoff’s affidavit affirmed 30 March 2015 at [37]-[39]).

Bill’s 1992 Will

76. In 1992, Bill executed a Will (see Sue’s affidavit sworn 22 July 2015, Ex A at p 104; Bruce’s affidavit sworn 28 September 2015, Ex 4 at pp 207-209), in which Geoff was left his interest in Pindaroi.

77. Merilyn’s evidence is that at some time prior to 1998 she heard her parents say that “Pinadaroi will form the major portion of Geoff’s future inheritance. The other three of you will share in whatever else remains” (see Merilyn’s affidavit sworn 28 September 2015 at [15]). Merilyn and Bruce emphasise (and I accept that the evidence of the siblings supports this) that the understanding within the family was that Pindaroi was to be Geoff’s “early” inheritance. This is supported by the Discussion Note given by Geoff to Bill shortly before Bill’s death – see below.

Geoff and Kaye’s purchase of Pindaroi - 1998

78. Geoff’s evidence is that, in 1998, he and Kaye wanted to secure their future on Pindaroi. Geoff says that, notwithstanding numerous promises by Bill to devise the property to them in his and Jill’s Wills, he and Kaye negotiated the purchase of the remaining part of Pindaroi. He deposes (see in his affidavit affirmed 30 March 2015 at [40]) that it was too great a risk to rely on his parents’ stated intention that he would inherit Pindaroi on their deaths and that he needed legal title to the land. In cross-examination he said that the concern in this regard was more that of Kaye (see T 61.4-9).

79. In any event, Geoff says that, in late 1998, Bill offered (on behalf of himself and Jill) to sell the remainder of Pindaroi (being the part of Pindaroi which was not the Woolshed Block) to Geoff and Kaye for $1,150,000. That is the purchase price recorded in the transfer for the property (Sue’s affidavit sworn 22 July 2015, Ex A at p 123).

80. Geoff says that the price was structured on the basis that: (i) $450,000 of the purchase price would be forgiven immediately (as Bill and Jill held the view that the property was actually worth $700,000 but, in accordance with accounting advice they had received, Bill and Jill decided to inflate the purchase price by $450,000 to reduce any future Capital Gains Tax liability to which Geoff and Kaye may have been subject if they ever sold the property); (ii) the amount of $200,000 was payable in instalments over the following 10 years; and (iii) the remaining $500,000 would be forgiven if the $200,000 was paid by Geoff and Kaye in accordance with the relevant payment terms (Geoff’s affidavit affirmed 30 March 2015 at [41]). Hence, Merilyn and Bruce emphasise that the purchase price paid by Geoff (and Kaye) for the balance of Pindaroi, in practical terms, was $200,000.

81. Geoff’s evidence concerning this arrangement is consistent with the transaction documents (Geoff’s affidavit sworn 18 October 2018 at [81]). Bill and Jill took security over Pindaroi by way of a registered mortgage dated 17 June 1998 which contained: (i) a certification that Bill and Jill released and forgave $450,000 of the purchase price on the date the mortgage was executed; (ii) a covenant by Geoff and Kaye to pay ten equal instalments of $20,000 on an annual basis concluding in the year 2007; and (iii) a covenant by Bill and Jill to the effect that, if Geoff and Kaye made the ten equal instalments of $20,000, they would forgive and release Geoff and Kaye from the balance of the principal sum (being $500,000) (Sue’s affidavit sworn 22 July 2015, Ex A at pp 124-126). Equivalent covenants are expressed in the special conditions to the Contract for Sale of the land (Sue’s affidavit sworn 22 July 2015, Ex A at p 39 (special condition “F”)). The Epitome of Mortgage also contains equivalent provisions to the covenants given by the respective parties to the transaction (Sue’s affidavit sworn 22 July 2015, Ex A at p 128).

82. Geoff says that he and Kaye met their obligations in respect of the payment of $200,000 by way of ten $20,000 payments being made annually, with the last payment being made on 27 June 2007 (Geoff’s affidavit sworn 8 June 2017 at [200]) and that accordingly the $500,000 was forgiven. I do not understand Merilyn and Bruce here to contend otherwise; rather, their position is that Geoff acquired his interest in Pindaroi at a significant undervalue (which they contend is relevant to both aspects of his claim in the primary proceedings). However, they do complain (see in due course below) that there was no disclosure to them of the waiver of this $500,000 loan following Jill’s death when they agreed to waive a smaller debt owed by Geoff to Jill’s estate.

83. The mortgage loan was recorded in The Monowai Partnership accounts as “Mortgage Loan GW & KR Bassett” for a value of $680,000; and the Pindaroi land, which had until then been recorded at its cost value of $234,373, was then “removed” from The Monowai Partnership accounts.

Mirror wills – 17 June 1998

84. Bill and Jill executed mirror wills on the same day as the transfer of Pindaroi to Geoff and Kaye. Unsurprisingly, the couple’s 1998 Wills no longer included a testamentary gift to Geoff of their interests in Pindaroi (a gift that had been consistent with the promise as to Geoff’s inheritance of the balance of Pindaroi but which was obviously of no utility once the property had been transferred to him inter vivos) and replaced it with a gift of their interest in the stock and equipment on Pindaroi (see Sue’s affidavit sworn 22 July 2015 at [20]; Bruce’s affidavit sworn 28 September 2015 at [77], Ex 4 at pp 210-215).

85. Merilyn’s evidence is that, in early 1998, her parents said that “[w]e’ve decided to sell Pindaroi to Geoff on very favourable terms and conditions” and that “[w]e are making new wills. We will leave Pindaroi, all stock and equipment to Geoff, with most of the remainder of the estate to be divided equally between the rest of you” (see Merilyn’s affidavit sworn 28 September 2015 at [17]).

86. Bruce has deposed that Jill told him “[w]e’ve let Geoff have his inheritance early by giving him Pindaroi cheaply … we’ll make sure it all evens out in the end” and that “[n]ow that we’ve agreed to give him Pindaroi, Geoff won’t be getting much more from your father and me” (Bruce’s affidavit sworn 28 September 2015 at [78]).

Geoff’s agricultural consultancy business

87. In or around 2000, Geoff started an agricultural consultancy business (Geoff’s affidavit affirmed 8 December 2015 at [75]). Through his consultancy business, Geoff provided advice to clients located in New South Wales, Queensland, Victoria and South Australia in relation to grain cropping, pastures, livestock, cell grazing, horses, orchards and sugar cane (Geoff’s affidavit affirmed 30 March 2015 at [60]).

88. The business was initially undertaken jointly with Kaye under the business name GW & KR Bassett. However, in 2009 Geoff commenced operating as a sole trader (Geoff’s affidavit affirmed 8 December 2015 at [76]; Bruce’s affidavit sworn 28 September 2015, Ex 4 at pp 345-346). Since about 2016, Geoff has provided his consultancy services through a company known as Farm Mojo Pty Ltd (Geoff’s affidavit sworn 4 August 2020 at [9], Annexure “D”).

89. Meanwhile, in 2000, Geoff had surgery to remove a pituitary tumour (Geoff’s affidavit affirmed 30 March 2015 at [86]).

Springs Partnership registration for GST

90. On 30 April 2000, The Springs Partnership was registered for GST. It traded under the name The Springs Pastoral Co (ABN 90 527 598 373) until February 2001. From 2 February 2001 to 17 June 2002, The Springs Partnership traded under the name The Springs Pindaroi Pastoral Co (but with the same ABN). From 17 June 2002 to 11 May 2007 The Springs Partnership traded under the name EJ Bassett & GW Bassett & KR Bassett & WR Bassett (but still with the same ABN).

Sale of Dunoola 2004

91. In 2004, Bill and Jill sold Dunoola.

Purchase of Hurricane Hill - 2005

92. By contract for sale dated 1 July 2005, Geoff and Kaye, together with Bill and Jill, purchased Hurricane Hill (Geoff’s affidavit affirmed 30 March 2015 at [30]). I have noted above the dispute as to whether this land was an asset held by the four individuals jointly or a partnership asset.

Alleged renewal of oral agreement re The Springs in 2005

93. Geoff alleges (see amended statement of claim at [18]) that, after the purchase of Hurricane Hill, he and Bill “renewed” their 1984 oral agreement, including that in consideration of Geoff continuing to run The Springs (and other matters), Bill would leave his share in The Springs to Geoff in his final Will. Geoff’s account of the conversation in relation to this is that Bill said that “[e]verything can pretty much continue on as it is” (Geoff’s affidavit affirmed 30 March 2015 at [30]).

94. Pausing here, it is not necessary to enter into debate as to the conceptual distinction between “renewal” or continuation of an earlier agreement and entry into a new or fresh agreement on the same or similar terms because ultimately Geoff does not rely on the 1984 agreement, or any agreement in 1985, as such.

Gift to Bruce - 2005

95. In 2005, Bill and Jill gave Bruce $50,000 to help Bruce and Edwina purchase a cottage in the Blue Mountains (see Bruce’s affidavit sworn 28 September 2015 at [20](c); Edwina’s affidavit sworn 28 September 2015 at [17]).

Jill’s death – March 2007

96. Jill died on 21 March 2007.

Jill’s Will dated 17 June 1998

97. As noted above, Jill executed her last Will on 17 June 1998 (Geoff’s affidavit affirmed 30 March 2015, Annexure H). Jill’s Will appointed Bill and Geoff as her executors and contained, relevantly, the following key terms.

97. By cl 3, Jill devised and bequeathed her jewellery to her daughters Sue and Merilyn as tenants in common in equal shares (cl 3). By cll 4 and 5, Jill devised and bequeathed to Bill: (i) her principal residence or any share she held in it as at the date of her death; (ii) various items of furniture; (iii) her “motor car and utility truck usually garaged at [her] said residence or any share therein owned by [her] at the date of [her] death”; (iv) her “two shop properties at Coffs Harbour being the Strata Title Units in Certificates of Title Folio Identifiers 15/SP20740 and 16/SP20740” (cl 4); and (v) all of her “share of any moneys owing to [her] jointly with [Bill] by my said son [Geoff] and his wife Kaye” and made provision to forgive such debts if Geoff or Kaye predeceased her (cl 5).

98. By cl 6, Jill devised and bequeathed to Geoff: (i) her share or interest in all farming plant and equipment, machinery and implements used in connection with the running of Pindaroi; and (ii) “[a]n one quarter share of my share in the remaining part of the real estate purchased by me and my said husband from the Estate of the late James Lauder comprising 18.69 hectares or thereabouts and being Lots 1 to 32 inclusive (excluding Lot 8) in Deposited Plan 876448”.

99. By cl 7, Jill devised and bequeathed to Merilyn, Sue and Bruce the residue of her property.

Family meeting after Jill’s funeral – 23 March 2007

101. There was a family meeting a couple of days after Jill’s funeral. Relevantly, the matters discussed at that family meeting included Bill’s wish to purchase from the residuary beneficiaries their interest in the farming property that Bill wanted to continue to run (i.e., Jill’s interest in The Springs that formed part of the residuary estate); Jill’s wish that a loan advanced to Geoff and Kaye should be waived; and the basis on which Bill and Jill had structured their Wills.

102. As to the first of those matters, Geoff has deposed that, at that meeting, Bill said “I want to buy you all out of some of the property you have been left, she [Jill] left you some property that I need to stay in business, you will all receive more money under this arrangement than is provided for you in your mother’s will” (see Geoff’s affidavit affirmed 30 March 2014 at [91]-[93]). This was seemingly a reference to Jill’s share in The Springs (since that was the subject of a formal transfer from the residuary beneficiaries to Bill in due course – see below).

103. Consistent with the above, Geoff has deposed (Geoff’s affidavit sworn 18 October 2018 at [43]) that after Jill died he and Bill agreed to continue farming on The Springs and that there was a conversation in about June 2007 to the following effect:

Bill:   I want to continue farming with you and Kaye as partners. When I buy Jill’s quarter share of The Springs land and the partnership I will own 50% and you and Kaye will own the other 50%. We can continue farming as before.

Geoff:   Kaye and I have discussed this and we are pleased that you are buying Mum’s quarter. We are happy to keep farming with you.

104. As to the second of those matters, Bruce and Edwina say that, at that family meeting, Bill told Geoff, Bruce, Merilyn and Sue (and the other attendees) that Jill had wanted a loan of $69,500 which she had advanced to Geoff and Kaye to be waived (this is the subject of Claim 1 of the first cross-claim).

105. According to Bruce, in reply to this statement by Bill, Geoff said that this debt forgiveness was “going to make him debt free for the first time in his life” (T 324.6-7). Geoff denies making this statement. It is submitted that it is inherently unlikely that he would have said this in circumstances where Geoff had significant debts at the time (notwithstanding the $69,500 debt the subject of the debt forgiveness). Bruce accepted, when it was put to Bruce in cross-examination that Geoff may not have made this statement but, rather, it may have simply reflected Bruce’s belief about Geoff’s financial position, that that was “possible” (T 324.19-21; cf T 235.1-7). Edwina, on the other hand, insisted in cross-examination that Geoff had made this statement (T 420.48-421.10).

106. As to the third of those matters, as already adverted to the siblings say that Geoff received his inheritance early (in the form of the sale of Pindaroi at an undervalue). Their evidence is that, at the family meeting, Bill said words to the effect that he and Jill considered this to be fair and that they had done their Wills the same way (see Bruce’s affidavit sworn 28 September 2015 at [91]-[92]; Merilyn’s affidavit sworn 28 September 2015 at [19]; Edwina’s affidavit sworn 28 September 2015 at [20]). Geoff, on the other hand, deposes that Bill said “Mum and I structured our wills so that the rest of you will now receive your share of inheritance” (Geoff’s affidavit sworn 8 June 2017 at [727]). On Geoff’s account of the conversation it might be possible to construe what Bill said as relating only to Jill’s inheritance. However, that is not the recollection of the siblings and it would not make much sense as the “evening up” did not occur then.

107. On the issue as to Geoff’s “early” inheritance, Edwina’s evidence is that, at some stage in mid-2007, Bill told Bruce and Edwina “Jill and I loaned Geoff the money to buy Pindaroi, and we only made him pay $200,000 for it … he’s got his inheritance now, and I think he’s pretty happy about that” (see Edwina’s affidavit sworn 28 September 2015 at [35]). However, Edwina’s evidence (which seems to contradict Bill’s understanding as she says it was conveyed to her) is that on 24 March 2007 Geoff said to Bruce and Merilyn “I am envious about how much cash you are getting from Mum. I am not getting as much…and I feel jealous about that” (Edwina’s affidavit sworn 28 September 2015 at [23]).

108. Geoff’s understanding seems to have been that the “evening up” of the inheritance was what occurred at the time of Jill’s Will (see T 74-75). Geoff sounded genuinely bemused when he said in cross-examination that he thought what his father had said at the family meeting after Jill’s funeral about structuring their Wills was ambiguous and that he was not sure that it meant anything (see T 76-77). I consider that Geoff was genuine in his denial that he knew the residue included The Springs (T 74). Geoff was adamant that Bill had reneged on his promise for him (T 129) and that he felt betrayed when he later learnt about the Will (T 119.35-40).

109. Each of Merilyn, Sue and Bruce received a sum of $595,000 from Jill’s estate (Bruce’s affidavit sworn 28 September 2015 at [20]). Geoff received $214,545.68 from Jill’s estate (Geoff’s affidavit affirmed 30 March 2015 at [99]). Bruce’s evidence is that he did not see Jill’s Will following her death and that he “didn’t think [he] had ever read a will until 2014” (Bruce’s affidavit sworn 28 November 2015 at [91]-[92]).

110. Pausing here, looking at in broad (albeit rough) terms; one can compare the siblings’ inheritance from Jill’s estate as follows: the residuary beneficiaries received close to $600,000 each; Geoff received around $215,000. Geoff had already in effect received the benefit of whatever amount is attributed to the sum forgiven in respect of the Pindaroi loan (at least $500,000, if his account of an artificial inflation of the purchase price for GST purposes is correct; or $950,000 if it is not). In other words, compared to the siblings’ $600,000 each, on one view Geoff received in effect around $715,000 but on another view around $1.165m. On the former view, there is nowhere near as stark a difference in the comparative “inheritance” by the siblings (around $115,000) as on the latter (around $565,000). Further, this does not take into account Geoff’s claimed expenditure on The Springs (which he valued at some $300,000). Therein seems to lie the seed of the siblings’ (or at least Merilyn and Bruce’s) discontent with the benefits that Geoff has already received compared to what they will receive out of their father’s estate. Geoff’s position, on the other hand, was that actually his siblings had received much more by way of inheritance than he had, and that he had received about half as much as them (see T 83.5-10). Whether that is true, arithmetically, probably depends on the value to be placed on Geoff’s own contribution to the Springs and how the purchase price for Pindaroi is to be treated.

Hurricane Hill

111. Jill’s interest in Hurricane Hill was transferred to Bill by survivorship on 16 August 2007. However, Hurricane Hill continued to be recorded as an asset of The Springs Partnership in the accounts of the partnership from 21 March 2007 through to 15 April 2009.

112. On 16 August 2007, Bill signed a discharge of mortgage in favour of Geoff and Kaye in relation to the mortgage debt of $520,000 owed by Geoff and Kaye in respect of Pindaroi. It is noted by Merilyn and Bruce that the mortgage debt was removed from The Monowai Partnership ’s ledgers as at the date of Jill’s death and that the ledgers showed Bill and Jill’s current accounts reduced by $260,000 each with the entry “Transfer of Mortgage Loan bal”. Complaint is made by Merilyn and Bruce that the debt waiver in favour of Geoff and Kaye was not disclosed in the inventory of property prepared for Jill’s estate (see for example their reply in relation to the first cross-claim).

113. Merilyn and Bruce note that the inventory of property and Affidavit of Executor filed in relation to Jill’s estate (signed on 16 August 2007): identifies Hurricane Hill as a joint asset of Bill and Jill, and shows Geoff and Kaye as owing $20,000 (with no reference to the $500,000 mortgage); identifies Jill’s one-quarter share of The Springs Partnership with a value of $23,676 but none of the partnership’s livestock, land or bank account; and does not identify Jill’s one-quarter share in Hurricane Hill as an asset of The Springs Partnership.

Deed of Release

114. On 28 December 2007, a Deed of Release was signed by the residuary beneficiaries of Jill’s estate in relation to Geoff’s debt of $69,500 to Jill’s estate (as already noted, this being the subject of Claim 1 of the first cross-claim). By their reply, Merilyn and Bruce contend that it is unconscionable for Geoff to rely on this Deed of Release (see further below).

Decision of Geoff and Kaye to sell Pindaroi and Woolshed Block - 2008

115. In early 2008, Geoff and Kaye decided to sell Pindaroi and the Woolshed Block and at or around this time they decided to separate (Geoff’s affidavit affirmed 30 March 2015 at [46]).

Transmission application re The Springs

116. On 22 May 2008, a transmission application was made in respect of Jill’s one-quarter interest in The Springs from Jill’s estate to Merilyn, Sue and Bruce. Following this, a one-quarter share in the land was transferred from Merilyn, Sue and Bruce to Bill (for the stated sum of $250,000) Sue’s affidavit sworn 22 July 2015 at [24]; Ex A at pp 143, 145. Complaint is here made by Merilyn and Bruce that only $200,000 was paid to Jill’s estate (see below).

117. Bruce and Edwina have deposed to conversations with Bill around the time the interest was transferred in which they say that Bruce asked Bill if that was the market value of the land (The Springs); and that Bill said it was “pretty close” and that “it will be coming back to you and the girls anyway when I’m gone” and that that was not going to change (it is said that Bill said “[n]o, I’ve always planned that you and your sisters will get The Springs”) (see Bruce’s affidavit sworn 28 September 2015 at [103]; Edwina’s affidavit sworn 28 September 2015 at [38]). Merilyn’s evidence is that Bill said to her “I intend to continue farming with Geoff for the foreseeable future. There’s not much point in you remaining as minority partners” (Merilyn’s affidavit sworn 28 September 2015 at [21]).

Cessation of Monowai Partnership

118. From 30 June 2008, The Monowai Partnership was recorded in the partnership records as the “WE Bassett and Estate EJ Bassett” partnership. This continued until disposal of trading stock to Bill at cost value on 30 September 2009 and final tax return on 30 June 2010 (with, it is noted by Merilyn and Bruce, involved no final settlement of accounts or winding up).

Alleged representations concerning The Springs

119. As referred to above, Geoff says that, from late 2008 and continuing in early 2009, Bill made representations to the effect that he would leave his share of The Springs to Geoff. Geoff says that Bill told him that he would devise his interest in The Springs to him (Geoff) in his Will. Geoff relies on these conversations in respect of both his primary (proprietary estoppel) claim and his family provision claim (as to the latter, on the basis that they are relevant to Bill’s testamentary intentions).

120. By way of context, Geoff says that, by 2009, he was at a critical juncture of his life, as he was separating from Kaye (Geoff’s affidavit affirmed 30 March 2015 at [62]-[63]) and was in the process of selling Pindaroi (which was where he lived at the time). It is noted that, by that time, Geoff had been developing a consulting business over the period of almost a decade (Geoff’s affidavit affirmed 8 December 2015 at [75]). Geoff says that he was faced with the decision as to whether he would continue farming The Springs with Bill (and invest further funds into The Springs) or, alternatively, sell his interest in The Springs and pursue his consulting business full time (Geoff’s affidavit affirmed 30 March 2015 at [64]-[66]).

121. Geoff says that, in 2009, Bill was also at a critical juncture in his life; that Bill was 80 years old; he had spent his working life as a farmer; and he wanted to spend his last years continuing to farm. Geoff says that by early January 2009, Bill knew that Geoff and Kaye were getting divorced and that Geoff was considering selling out of The Springs (which would form part of the process of finalising his separation from Kaye) and going full time into consulting. He says that Bill wanted to keep farming The Springs and wanted Geoff to stay on to make this possible (since, given Bill’s age, Bill was not in a position to work the land himself). It is said that the only way that Bill could continue to farm The Springs was to convince Geoff to continue working the land. Geoff says that, unlike in previous years where Bill had made statements to Geoff in relation to inheriting The Springs (such as his statement in 1984 that one day Geoff could “buy us out of our share or inherit it” (Geoff’s affidavit affirmed 30 March 2015 at [23])), as at 2009, Bill needed Geoff to work The Springs if Bill were to remain farming there.

122. Geoff says that he and Bill had a number of discussions in the period from December 2008 to March 2009 about their business options; in particular as to Geoff remaining at The Springs. It is submitted that this is to be expected as this was a very significant issue for both Geoff and Bill during this period and Geoff and Bill spent a considerable amount of time together over this period while travelling to, and working on, The Springs.

123. Geoff gives a number of accounts of conversations which occurred over that period (Geoff’s affidavit affirmed 30 March 2015 at [63]); Geoff’s affidavit affirmed 8 December 2015 at [61], [128]; Geoff’s affidavit sworn 18 October 2018 at [45]-[52]). Geoff says that the common elements of those conversations were that: (i) Geoff was considering selling his interest in The Springs and moving to Guyra NSW (and purchasing a property there) with a view to pursuing his consultancy business full time; (ii) Bill asked him to stay in Inverell and continue to hold his interest in The Springs and farm the property; and (iii) if Geoff did so, Bill would devise his half interest in The Springs to Geoff in his Will. Geoff’s evidence is that he agreed to stay and farm The Springs with Bill on this basis.

124. Geoff says that he worked on The Springs in the period from 2009 on an unpaid basis; that he invested significant time and effort into the development of The Springs and, through his unpaid work, increased the value of both his interest in The Springs and also the value of Bill’s interest in The Springs.

Bill revises his Will

125. In March 2009, (i.e., at around the very time that Geoff says he was having discussions with Bill as to Bill leaving him his share of The Springs in his Will) Bill attended Borthwick & Butler to revise his Will (see Sue’s affidavit sworn 22 July 2015 at [25]).

Sale of Pindaroi and Woolshed Block

126. In April 2009, Pindaroi and the Woolshed Block were sold by Geoff and Kaye for $4.2 million, the net proceeds being $3,294,683.46 (Geoff’s affidavit affirmed 30 March 2015 at [48]).

Establishment of The Bassett Grazing Co Partnership – 1 May 2009

127. As noted above, on 1 May 2009 the WE & GW Bassett partnership (which later became known as the Bassett Grazing Co) was established between Bill and Geoff (see Geoff’s affidavit sworn 8 June 2017; at Ex B at Tab 43, p 108). Complaint is made by Merilyn and Bruce that there was no final settlement of the accounts or winding up of The Springs Partnership and that its property was transferred to The Bassett Grazing Co Partnership (which Merilyn and Bruce say Geoff and Bill continued to operate as a “reconstituted” partnership – see defendants’ chronology at [162]). Mr Carrigan has deposed that Jill’s interest in The Springs Partnership was transferred to The Bassett Grazing Co Partnership and that he recorded Jill’s interest as having been paid to Bill as a salary allowance in the ledgers of The Springs Partnership.

128. Complaint is made by Merilyn and Bruce that no consideration was paid for Jill’s interest in The Springs Partnership (with a value of $121,922.28 excluding Hurricane Hill as at 15 April 2009) and that Geoff and Bill did not collect for Jill’s estate the balance of a loan that The Springs Partnership owed to The Monowai Partnership (with a value of $81,000 as at 15 April 2009).

129. Merilyn and Bruce note that Geoff’s cattle were entered in the accounts of The Bassett Grazing Co Partnership and that he was paid for these in September – October 2009.

Alleged renewal of oral agreement re The Springs

130. Geoff alleges in the amended statement of claim that, on 1 May 2009 (although in his oral evidence he put this as being during the conversations from December 2008 to February 2009), he and Bill again “renewed” their oral agreement that included the promise that Bill would leave his share of The Springs to Geoff in his final Will (see amended statement of claim at [19]).

Bill’s Will – 14 May 2009

131. On 5 May 2009, (i.e., at around the very time that Geoff says he was having discussions with Bill as to Bill leaving him his share of The Springs in his Will) Borthwick & Butler sent to Bill the second draft of his new Will – the first having been provided on 23 March 2009, noting that Bill had attended their office to provide instructions. On 14 May 2009, Bill executed a new Will. Inconsistently with the alleged oral agreement (and alleged representations), it contained, relevantly, the provision extracted earlier (cl 3, see above) excluding from the bequest to Geoff any interest in real property owned jointly with Geoff.

132. It is to be noted that this new Will was executed within a very short time from the time at which Geoff has pleaded that Bill again renewed the promise to leave his share of The Springs to Geoff (i.e., 1 May 2009) (timing that Merilyn and Bruce emphasise as being inconsistent with such a promise or agreement); and, even on the basis that the agreement was reached at an earlier time in 2009, still very close to that time.

The Bassett Grazing Co Partnership records

133. In his affidavit affirmed 30 March 2015 at [63], Geoff deposes that, in establishing The Bassett Grazing Co Partnership in early 2009, he and Bill agreed that:

We’ll both need to invest some more of our personal capital to increase productivity on The Springs. If I’m inheriting you half I’m prepared to invest in the long-term improvement of the farm. I could buy my best Limousin cows from Pindaroi and sell them to The Springs. They are much more productive than any of the cows we have been able to buy elsewhere.

943. Under Bill’s Will, Geoff was given Bill’s interest in various farming plant and equipment and Bill’s interest in The Bassett Grazing Co Partnership with a value of approximately $233,835 (according to the inventory of property filed in Probate) (Geoff’s affidavit affirmed on 30 March 2015 at Annexure D). Therefore, if the desktop valuation is adopted, then excluding the specific bequest in relation to The Bassett Grazing Co Partnership (valued at $233,835), the overall estate would be valued at $4,040,683.

944. It is not disputed that the provision made for Geoff in Bill’s Will was considerably less than the provision made for each of his siblings ($233,835 compared to the siblings’ one-third share each of $4,040,683 adopting the desktop valuation figure).

945. From the above it can also be seen, in broad terms (and adopting the figures in the desktop valuation), that had Bill left Geoff one-quarter of his residuary estate but the specific bequest in relation to The Bassett Grazing Co Partnership remained as is, then each of the three other siblings would have received in effect approximately $1,010,170.75 and Geoff would have received $1,244,005 taking into account the plant and equipment and share of The Bassett Grazing Co Partnership. Whereas, had the bequest to Geoff been of the whole of Bill’s half share in The Springs (plus the interest in relation to The Bassett Grazing Co Partnership) then the other siblings’ share of the residuary estate would be valued at one-third of around $2,290,683, i.e., $763,561 on my rough arithmetic). In other words, having regard to the two options that on Sue’s evidence Bill was considering at the time shortly before his death, the other siblings would have been in a more favourable position had there been a one-quarter division of the estate than if Bill were to have left the whole of his half interest in The Springs to Geoff. I raise this at this stage as it puts into context the apparent disconformity between the siblings’ perspectives as to the evening up of their share of their inheritance from their parents’ estates (particularly since the other siblings received considerably more from Jill’s estate than did Geoff but Geoff received considerably more in financial assistance from his parents in their lifetime than did the other siblings).

The financial resources and needs of the applicant and other persons – s 60(2)(d)

Geoff

947. Geoff’s evidence is that he presently has net assets with an estimated value of $2,124,240, calculated by reference to assets of which Geoff is the sole owner, with an estimated net value of $493,942 (Geoff’s affidavit sworn 4 August 2020 at Annexure A) and assets of which Geoff is a co-owner, of which Geoff’s share has an estimated net value of $1,630,298 (Geoff’s affidavit sworn 4 August 2020 at Annexure B).

948. Geoff’s income varies from month to month depending on the income derived through his consultancy business. The notice of assessment for the year ended 30 June 2018 (issued to Geoff) disclosed the following income: in 2014, $52,740; in 2015, $101,249; in 2016, $39,130; in 2017, $91,688; and in 2018, nil.

949. Geoff was diagnosed with a large pituitary tumour in 2000 and has had his pituitary gland removed. As a result, Geoff requires medication with a monthly cost of $310 (and currently incurs health related costs of $447 per month). Geoff is no longer able to produce a “human growth hormone” which retails at $3,300 per month. To date, Geoff has not been taking this medication due to the cost being prohibitive (Geoff’s affidavit affirmed on 30 March 2015 at [86]). Geoff suffered from a heart attack in 2017 and was hospitalised shortly before the hearing with heart related concerns (Geoff’s affidavit sworn 4 August 2020 at [38]).

950. As a result of no longer having a pituitary gland, Geoff is starting to suffer from the effects of long term cortisone use, being a deterioration of his teeth and bone density (Geoff’s affidavit sworn 4 August 2020 at [43]). It is submitted that this is of particular concern for Geoff as he earns his living through tough physical work associated with farming and consulting. It is said that as Geoff’s condition continues to deteriorate, there is a significant risk that he will no longer be able to earn an income as a farmer and consultant, being the only area in which Geoff has vocational skills.

951. It was submitted that if Merilyn and Bruce were successful in whole or in part in relation to the claims made in the first cross-claim (which they have not been as it transpires), Geoff could have a significant financial need at the time of judgment (the quantum of which necessarily could not be determined until the date of judgment).

Sue

952. Sue was born in 1957 and is married. Sue is a registered nurse but does not presently work and her husband is employed as a storeman. Sue and her husband have three adult children (Sue’s affidavit sworn 22 July 2015 at [46]).

953. Sue and her husband have assets with an estimated value of $2,071,700 and do not have any liabilities other than regular household expenses and costs of maintaining their properties and cars (Sue’s affidavit sworn 22 July 2015 at [47]-[48]).

954. Bill and Jill gave Sue a gift of about $10,000 in 1989 and a further $50,000 sometime after 1989 (Sue’s affidavit sworn 22 July 2015 at [45]; Edwina’s affidavit sworn 28 September 2015 at [18]).

Merilyn

955. Merilyn was born in April 1955.

956. In 2015, Merilyn gave evidence that she was then retired and her then current income from superannuation was $55,000 per annum, and she estimated that the total value of her assets was $1,263,800 and that her liabilities were nil (Merilyn’s affidavit sworn 28 September 2015 at [4]). Merilyn more recently gave evidence that her income has increased to $62,500 per annum and she estimates that the total of her assets has marginally decreased to $1,239,590 (but that she now makes a contribution to her daughter’s rent which amounts to an annual liability of $7,800 per annum) (Merilyn’s affidavit sworn 5 August 2020 at [10]).

957. Merilyn’s husband, Mr Robert Jaensch is a qualified carpenter and licensed builder. In 2015, Mr Jaensch had an income of $75,000 per annum, had total assets with an estimated value of $625,000 and liabilities of $3,000 (Merilyn’s affidavit sworn 28 September 2015 at [4], [6]). Merilyn’s evidence is that Mr Jaensch’s income has now increased to $89,000 per annum and the estimated value of his total assets has increased significantly since 2015 and are now valued at approximately $1,032,150. Mr Jaensch has estimated liabilities of $5,000 per month (being a monthly trade account at Bunnings) (Merilyn’s affidavit sworn 5 August 2020 at [11]).

958. Merilyn’s evidence is that the only inter vivos gift she received from her parents was a payment of $10,000 in the 1980s (Merilyn’s affidavit sworn 28 September 2015 at [14]).

Bruce

959. Bruce was born in February 1965.

960. Bruce completed a Bachelor of Arts degree. Bruce is presently employed by the government “in a temporary position” (Bruce’s affidavit sworn 6 August 2020 at [8]). Bruce presently earns a net income of $56,002 per annum (Bruce’s affidavit sworn 6 August 2020 at [14]). Edwina presently earns a net income of $7,190 per annum, but the source of her income is not disclosed in evidence (Bruce’s affidavit sworn 6 August 2020 at [14]).

961. Bruce gives evidence that he and Edwina have total net assets with an estimated value of $370,525.92 (Bruce’s affidavit sworn 6 August 2020 at [14]). However, this amount appears to exclude superannuation entitlements which are, for Bruce and Edwina in aggregate, $211,753.33 (Bruce’s affidavit sworn 6 August 2020 at [14]). Therefore, it is said by Geoff that Bruce and Edwina appear to have net assets of $582,279.25.

962. Geoff points to the evidence that Bill and Jill gifted Bruce and Edwina: (i) $6,000 in 1991 (Bruce’s affidavit sworn 28 September 2015 at [20]; (ii) $5,000 in the mid 1990’s to buy a car (Edwina’s affidavit sworn 28 September 2015 at [16])); (iii) a further $50,000 in about 2005 when Bruce and Edwina bought their first home (Edwina’s affidavit sworn 28 September 2015 at [17])); and (iv) a further $20,000 in June 2013 (Edwina’s affidavit sworn 28 September 2015 at [19]; Bruce’s affidavit sworn 28 September 2015 at [21]).

963. Bruce suffers from a number of medical ailments (being broad-based disc herniation, depression, Profound Hashimoto’s Thyroiditis and Eosinophilic Oesophagitis) (Bruce’s affidavit sworn 28 September 2015 at [17]; Bruce’s affidavit sworn 6 August 2020 at [9]-[12]). Bruce gave evidence in 2015 (some five years ago) that he and Edwina were considering starting a business and that he and Edwina estimated that their costs of doing so would be at least $140,000 in the first year of operation (Bruce’s affidavit sworn 28 September 2015 at [18]); Edwina’s affidavit sworn 28 September 2015 at [104]). Bruce has not provided any evidence concerning this proposed business in his more recent 6 August 2020 affidavit.

The financial circumstances of anyone cohabiting with the applicant – s 60(2)(e)

964. At the time of the hearing Geoff had recently become separated from his former de facto partner, Fiona, and they were no longer co-habiting (Geoff’s affidavit sworn 4 August 2020 at [32]-[36]).

The physical disability of Geoff and Bruce – s 60(2)(f)

965. This has been dealt with above.

The age of the applicant when the application is being considered – s 60(2)(g)

966. Geoff was born in 1960 and, as at the date the final hearing commenced, was 60 years old (Geoff’s affidavit sworn 4 August 2020 at [37]).

Contributions (financial or otherwise) by the applicant to the acquisition, conservation and improvement of the estate of the deceased person or to the welfare of the deceased person for which adequate consideration was not received – s 60(2)(h)

967. It is said that Geoff made considerable contributions to the conservation and improvement of his father’s estate, including the matters set out above.

968. Geoff’s evidence is that from 1978, when Geoff leased the “top end” of the Woolshed Block, he conducted significant unpaid work on the “top end” of the Woolshed Block by, inter alia, putting up new fences, clearing dead timber and rock, contouring and cultivating arable soil, controlling annual and woody weeds and planting improved pasture species (Geoff’s affidavit affirmed on 30 March 2015 at [15]).

969. Once Geoff had completed a wool classing course in 1983, Geoff undertook all of the wool classing for the sheep located on Pindaroi and was never paid for this work (Geoff’s affidavit affirmed on 30 March 2015 at [53]-[54]).

970. Following the purchase of the whole Woolshed Block by Geoff, Geoff was no longer paid for conducting work on his parents’ land. However, Geoff conducted considerable unpaid work on his parents’ Pindaroi property including, inter alia, operating the harvester at harvest time, driving grain trucks and tractors, fixing machinery, welding, wool classing, mustering sheep, organizing casual labour, lamb marking, pregnancy testing, spraying annual weeds, fencing and general property maintenance, serving windmills and designing and building sheep yards (Geoff’s affidavit affirmed on 30 March 2015 at [21]). Geoff also estimates that he reinvested approximately $300,000 into improving Pindaroi while leasing the property (Geoff’s affidavit affirmed on 30 March 2015 at [37]). These improvements included, inter alia, overhauling the existing water system to run stock water to most of the paddocks, “farm-over banking the existing contour banks” which had the effect of mitigating erosion; remedying “salt scalds”, removing old fences, maintenance of existing fencing and erecting approximately 30kms of electric fencing and 12kms of conventional fencing, bulldozing tree debris, fertilising and sowing paddocks, clearing land, spraying weeds and extensively renovating the homestead located on the property (including upgrading and modernising the kitchen, bathroom, electrical wiring system, the plumbing system, relining rooms with new gyprock, internal building, painting, installing new floor coverings and replacing rotten timbers) (Geoff’s affidavit affirmed on 30 March 2015 at [39]).

971. It is said that Geoff contributed the majority of the labour on The Springs (on an unpaid basis) (Geoff’s affidavit affirmed on 30 March 2015 at [26]); Geoff’s affidavit affirmed 8 December 2015 at [12]). This included facilitating the shearing of Bill’s 3,000 to 6,000 sheep (with the stock he held varying from time to time), crutching the sheep and undertaking fencing work (Geoff’s affidavit sworn 8 June 2017 at [68], [223]; Geoff’s affidavit affirmed 8 December 2015 at [70]).

972. Although it is the case that Geoff, from time to time, had the benefit of using Bill and Jill’s equipment, it is said that this was a reciprocal arrangement (Geoff’s affidavit affirmed 8 December 2015 at [40]). For example, it is said that Bill and Jill used Geoff’s woolshed, shower dip and sheep yards for many years free of charge (Geoff’s affidavit affirmed 8 December 2015 at [28]).

Provision made for the applicant by the deceased – s 60(2)(i)

973. As to the assertions made by Merilyn and Bruce to the effect that Geoff received significant gifts throughout his life from Bill and Jill, Geoff says that many of the “gifts” given by Bill and Jill to Geoff were business transactions between Bill and Jill on the one hand and Geoff (or Geoff and Kaye) on the other, involving land transfers and sale contracts, which he says appear to have included favourable terms in recognition of his contributions to the relevant assets through the provision of his labour.

974. It is accepted that in relation to the Woolshed Block, there is some uncertainty as to the amount paid by Geoff. This is said to be unsurprising given the time since the property was purchased in 1985. The property was sold for $145,214. Geoff’s evidence is that Bill unilaterally decided artificially to inflate the price as the property was purchased prior to the introduction of Capital Gains Tax and the inflated price would assist Geoff with minimising any future Capital Gains Tax liability if he decided to sell the property in due course. It is Geoff’s recollection that he was released from paying $30,000 of the price upon the purchase to reflect either the fact that the price had been artificially inflated and/or to reflect the capital improvements he made to the property. Geoff says that it is unclear to what extent the apparent gift he received (by way of debt forgiveness) was given by reason of Geoff’s capital works conducted on the land when he was leasing it and/or to reflect the fact that the price of the land had been artificially inflated by Bill.

975. In relation to Pindaroi, it is said to be uncontroversial that Geoff and Kaye agreed to purchase the property for $1,150,000. Reference is made to Geoff’s evidence of a conversation he had with his father in which Bill told him that he considered Pindaroi to be worth $700,000 but that he wanted to inflate the price by $450,000 to reduce any future Capital Gains Tax liability should Geoff sell the property in the future. This is said to be consistent with the fact that the sum of $450,000 of the purchase price was forgiven by Bill and Jill at the time of the purchase. In that conversation, Geoff says that Bill told him that he and Kaye could pay him and Jill $200,000 for the property over the following ten years at which time they would “gift” Geoff the remaining $500,000.

976. It is noted that much of the evidence relied on by Merilyn and Bruce as to gifts allegedly given to Geoff is based on conversations witnesses are said to have had with Bill and Jill. Geoff says that Merilyn and Bruce (as well as Sue) also received financial assistance from their parents. In addition to the inter vivos gifts referred to above, Geoff points out that each of Merilyn, Sue and Bruce inherited $595,000 from Jill’s estate (Sue’s affidavit sworn 22 July 2015 at [44]; Bruce’s affidavit sworn 28 September 2015 at [20]). In contrast, Geoff received Jill’s share in some farming equipment located on Pindaroi (although it is unclear whether there was any equipment of this nature) and, although he was entitled to receive a one quarter share in land known as Bassett Downs, he did not receive his full entitlement (as explained above).

977. Insofar as Merilyn and Bruce allege that Geoff also received a benefit by reason of the various loans Geoff is said to have received from his parents (rather than being required to obtain finance from third party sources), while Geoff accepts that this may be correct, he says that it is also the case that The Monowai Partnership was paid significant interest on those funds and accordingly, derived a significant benefit. It is said, by way of example, that some of the funds loaned by The Monowai Partnership to The Springs Partnership were loaned pursuant to a verbal agreement of which one of the terms was that The Springs Partnership would pay the same interest rate as the National Australia Bank was then charging (Geoff’s affidavit affirmed 8 December 2015 at [31], [50])). It is said that this is very likely to have been in excess of any other interest rate available at the time for funds on deposit.

Evidence of testamentary intentions of the deceased – s 60(2)(j)

978. Geoff relies in this context on the evidence as to Bill’s testamentary intentions referred to above in support of Geoff’s estoppel by encouragement claim. However, it is submitted that there are also a number of other significant events which are relevant to Bill’s testamentary intentions, namely, what was said at the family meeting following Jill’s death (see above and Sue’s evidence as to the conversation(s) with Bill in December 2013 at Coffs Harbour (see above)).

979. Geoff says that Sue provides critical evidence concerning Bill’s testamentary intentions. Geoff submits that it is apparent from the Coffs Harbour conversation that: Bill wanted to change his Will either to leave Geoff his interest in The Springs or 25% of his estate; and that Bill wanted Geoff to own the entirety of The Springs and had decided to leave it to him or leave him with sufficient funds to purchase it from his siblings.

980. Against this it is noted that Bruce and Edwina claim to have had a number of conversations with Bill concerning his testamentary intentions (Bruce’s affidavit sworn 28 September 2015 at [143], [146], [160], [161], [164]-[170]; Edwina’s affidavit sworn 28 September 2015 at [40], [59], [60], [85]-[87]; Edwina’s affidavit sworn 26 April 2018 at [21]).

Geoff’s position

981. Geoff thus submits that if he is unsuccessful in his estoppel claim (as it turns out he has been) then further provision should be made for him out of Bill’s estate and/or notional estate. The amounts distributed to residuary beneficiaries by way of partial distribution out of Bill’s estate might have been available to be designated as notional estate but ultimately it is not necessary to consider any issue of notional estate as I consider that proper and adequate provision can be made out of Bill’s share of The Springs (see below).

Merilyn and Bruce’s submissions re family provision claim

982. Merilyn and Bruce submit that Geoff has not demonstrated that he has been left without adequate or proper provision. Reference is made to Geoff’s financial circumstances, as set out in his affidavit sworn 4 August 2020, to the effect that he: operates a “highly successful biological consultancy business” which turns a profit; owns farming property on his own account (a half-share of The Springs) and with Fiona (his former de facto partner); continues to farm The Springs land; has been able to provide substantial five and six figure cash gifts to his children and to Fiona; has “total net assets” of $493,942 in his own right, and $1,630,298 of assets held with other persons (including the residuary interests in Bill’s estate); has total monthly expenditure of $3,201; and has a current gross income of $92,204 plus any consultancy income (which the previous year was $44,133). (Complaint is here made by Merilyn and Bruce that Geoff does not provide an easily ascertainable figure for net income as required by the Practice Note SC Eq 7. I note, however, that it was not suggested in their submissions that there was an issue of lack of disclosure of the kind that may have warranted dismissal of the claim along the lines of the principles considered in Stone v Stone [2019] NSWSC 233.)

982. Merilyn and Bruce say that Geoff was able to take drawings of $518,624 in 2016 from his sole trader business, and he sold his Clancy’s Drive property in 2017; and was able to give Fiona a gift of around $100,000 in 2015 and made numerous gifts to his children.

983. Merilyn and Bruce do not accept the amounts and values ascribed to Geoff’s assets. It is said that Geoff has also no doubt been assisted by the undisclosed assets of Fiona, who was Geoff’s de facto partner until 19 July 2020. However, it is submitted that, even on his disclosed financial circumstances, Geoff has not been left without adequate provision.

984. Merilyn and Bruce also point to a property search disclosing that Geoff sold his half of Hurricane Hill for $410,000 on 23 April 2020 to OHM Pty Ltd (OHM), a company of which Geoff and Fiona are the directors (Bruce’s affidavit sworn 6 August 2020 at [53]-[54]), Annexures G and H). Complaint is made that Geoff did not disclose in his updating evidence the financial records for OHM, the trustee of his superannuation fund (which was set up by Fiona) and that he has disclosed very little about this transaction and this entity. (Geoff’s evidence at T 142.49-143.5, which was given in what seemed to me to be a resigned way, and which rang true, was that the sale to OHM was the only option to fund this litigation.)

985. Merilyn and Bruce say that their parents provided Geoff with significant benefits during his lifetime. They note that, as a son who wished to farm, he was provided with award wages and accommodation at Pindaroi, the family farm, upon leaving school in 1977; and that he was also given exclusive use of the “top end paddock” (some 389 acres) from which he could earn income. Merilyn and Bruce note that Geoff was assisted to purchase his half of The Springs in 1985 with loans from his parents over decades; and they say he was also given loans and price discounts from his parents to purchase the Woolshed Block in 1984.

986. Merilyn and Bruce say that Geoff’s purchase of the rest of Pindaroi farm in 1998 (“ostensibly” for $1,150,000) was subsidised by Bill and Jill by way of gifts, discounts and loans which were waived, and a release from a mortgage so that he paid only $200,000.00 for the property, which Geoff sold in 2009 for $4,200,000 (Bruce’s affidavit of 28 September 2015 at [88]). In this regard, Merilyn and Bruce say that the “family truth” was that Geoff received his inheritance early through the transfer of Pindaroi to him by his parents.

987. Merilyn and Bruce say that, should it not be accepted that Geoff has been adequately provided for (including the significant provision of the property Pindaroi to him as his “early inheritance”, and substantial gifts, land discounts and waiver of loans during his lifetime), then there should nonetheless be a finding that, in the circumstances, no further provision should be made.

988. It is submitted that the contrast in the financial circumstances of Bruce (and his wife, Edwina) and Merilyn (and her husband, Robert) should be considered. Bruce and Edwina have deposed to a modest combined net income of $63,192.00. Their expenses of $84,900.00 per annum well exceed this income. Bruce and Edwina’s net assets are said to be $370,525.92 plus Bruce’s superannuation of $120,553.92 and Edwina’s superannuation of $91,199.41. Merilyn is retired and has a modest income of approximately $62,500 per annum which she receives from her superannuation. Merilyn’s husband, Robert, continues to work and has an income of $89,000 per annum but will be unable to work shortly due to expected surgery, requiring him into forced retirement. Merilyn and Robert’s net assets are said to be $1,216.740.00 plus Merilyn’s superannuation of $578,000 and Robert’s superannuation of $477,000.

989. It is noted that Sue has chosen not to put forward her own financial circumstances for consideration but it is nevertheless submitted that all three of Geoff’s siblings (i.e., including Sue) have strong moral claims on the bounty of their father, which it is said, was recognised by his leaving them the residue of his estate.

990. Further, it is submitted by Merilyn and Bruce that, if Geoff’s first claim is dismissed with costs, then those costs are not a matter to be taken into account in determining his Family Provision claim; referring to the approach taken in Poche v Poche (2020) NSWSC 835 by Henry J. There, the costs of the plaintiff’s successful family provision claim were capped and the plaintiff was ordered to pay the costs of the estate for the unsuccessful probate claim. Relevantly, see the remarks of Henry J.

991. Merilyn and Bruce thus submit that the application for a family provision order should be dismissed, with consideration as to the appropriate costs orders.

Determination

993. Noting the principles set out above as to the evaluative process required by s 59 of the Succession Act, I have concluded that, considering the matter as at the time of the determination of Geoff’s application, in light of the outcome of the first cross-claim there was not adequate or proper provision made for him under Bill’s Will.

994. In this regard, while accepting that Geoff has had the benefit of substantial assistance during the course of Bill (and Jill)’s lifetime(s), in terms of both financial assistance in the form of loans and in the waiver of loans or debt forgiveness given over the years, and accepting that his acquisition of Pindaroi at an effective cost of around $200,000 was understood within the family to be his “early” inheritance, the difficulty as I see it is that Geoff is now left in a position (particularly if ordered to pay costs of the primary claim on which he has not been successful) that he appears to be what may be described as asset rich but cash poor; and at risk that he will be unable to continue to farm The Springs. That is because he will, as a practical matter, presumably need to buy out his siblings’ half share in The Springs if he wishes to remain farming on that land; and if unable to procure finance for that purpose would presumably need to sell The Springs.

995. Leaving aside the evidence of Edwina (about which I am cautious due to her obvious self-interest and apparent antipathy towards Geoff) as to the suggestion that Geoff may not intend to retain The Springs (such as her evidence about him looking at brochures for property in Noosa), I have no doubt that it was Bill’s wish (consistent with his testamentary gift of the plant and equipment on The Springs to Geoff) that Geoff be able to continue to farm The Springs. I place considerable weight on the evidence of Sue as to her discussion with Bill in late 2013 (which I accept) as to Bill’s concern that he may need to change his Will so as to enable Geoff to buy out his siblings’ share of The Springs or to leave that share to Geoff. Similar concern was expressed to Bruce.

996. Balanced against this is the family understanding that Pindaroi was Geoff’s early inheritance. However, the evidence of Sue leads me to conclude that this was not regarded by Bill as “set in stone” so to speak.

997. I accept that the respective siblings have needs of their own and I have taken into account their competing claims on Bill’s testamentary bounty (noting that they received a greater inheritance from Jill than did Geoff, no doubt because of his acquisition of Pindaroi but also that they received some, albeit less, financial assistance in their parents’ lifetime in terms of gifts).

998. Also to be taken into account as a relevant factor are the costs that have been incurred in the course of the hearing on both the primary claim (which has been unsuccessful), and the family provision claim. Prior to the hearing Geoff put his costs “to date in these proceedings” as $1,201,658.28, with a “current trust account balance” with Geoff’s solicitors of $265,921.69 (said to reflect the costs of the hearing and additional to the costs already incurred) (Geoff’s affidavit sworn 4 August 202 at [58]-[59]). However, after the commencement of the hearing, a further costs affidavit of 17 August 2020 filed by Geoff deposed that, in addition to the costs previously deposed by his client (noted in the preceding paragraph), his solicitors had rendered a further tax invoice of $47,410 and his solicitor, Mr Martin, expected that Geoff would incur a further $180,000 for professional fees with Martin Legal for the period from 1 to 28 August 2020 (affidavit of Alexander Richard Martin sworn 17 August 2020). It is noted that an additional $104,985.70 had been paid to the Martin Legal trust account.

999. Merilyn and Bruce submit that the way in which the costs of the plaintiff should be dealt with, including, if Geoff is successful in any part of the amended statement of claim, is that his costs recoverable out of Bill’s estate be capped by way of a fixed-sum costs order under s 98 of the Civil Procedure Act 2005 (NSW) (referring to Baychek v Baychek [2010] NSWSC 987 at [17] per Ball J).

1000. Without determining at this stage the final orders as to costs, it is relevant in my opinion to note that if costs follow the event as in the ordinary course then it might be expected that Geoff would bear Merilyn and Bruce’s costs of the unsuccessful proprietary estoppel claim but that they (or the estate) would bear the costs of their unsuccessful cross-claim. Whether those would balance out is another matter. However, to the extent that Geoff may have incurred costs beyond that for which he might recover in the litigation, the potential of such an outcome is a relevant (though I do not suggest determinative) factor to be taken into account in the family provision claim.

1001. On the whole, having regard to the importance that Bill clearly placed on the continued farming by Geoff of The Springs, and Bill’s acknowledgement to Sue that Geoff probably would have had an expectation that he would be left his father’s interest in The Springs, together with the evidence that suggests that Bill may have assumed that Geoff would be in a position to buy out his siblings’ interest in the land, and given that the family understanding as to Geoff’s “early inheritance” seems to have assumed an overall equivalence across both estates, I have concluded that adequate and proper provision was not left for Geoff (insofar as he may now be left unable to retain and continue to farm The Springs); and that the proper provision for Geoff is that, in addition to the interest in The Bassett Grazing Co Partnership, he be given a half share of Bill’s 50% interest in The Springs, such that Geoff’s overall ownership of The Springs (including his existing 50% interest) would be a 75% interest. The burden of that further provision should fall equally on the residuary beneficiaries such that each of the other siblings between them would have an equal share of a 25% interest in The Springs. On the rough figures referred to earlier in these reasons (and adopting the desktop valuation for this purpose), this would mean that the siblings’ share of the residuary estate would be valued at around $1,055,227; and, again, albeit on my rough calculations, that would mean that, taking into account the amount inherited by the other siblings from Jill’s estate and the provision made for Geoff in his lifetime, there would not in my opinion be a marked disproportion in the respective siblings’ inheritances from their parents’ estates. Moreover, this may facilitate Geoff’s ability to retain and continue to farm The Springs, which would accord with what I understand to have been Bill’s ultimate wishes as to the land and consistent with the bequest as to the farming equipment and the like.

Costs

1002. As to the question of costs, Merilyn and Bruce say that in circumstances where they have been acting to represent the estate (and the interests of Sue) in the defence of the proceeding (which they say was the appropriate course given Sue’s unwillingness to accept the terms of Bill’s Will, which as executor she was duty bound to defend), their costs of the defence of the proceeding should be paid out of the estate. It is said that even if (as he has been) Geoff is successful in obtaining further provision consideration should be given to the making of a special costs order.

1003. As the parties seek to be heard on the question of costs, I will make directions to permit that to occur. If possible, I will deal with costs on the papers.

Orders

1004. For those reasons, I make the following orders:

1. Dismiss the first cross-claim.

2. Dismiss the second cross-claim with no order for costs.

3. In addition to the bequest in the plaintiff’s favour under the deceased’s Will, order that there be further provision out of the estate of the late William Bassett in favour of the plaintiff, in the form of a one-half share of the deceased’s 50% share of the land known as The Springs, and that the burden of that bequest should be charged equally over the interests left to the plaintiff’s siblings in respect of the land; to the effect that the siblings’ interest in The Springs, as part of the residue of the deceased’s estate, is reduced to a 25% share of the land, to be held as between them in equal shares.

4. Otherwise dismiss the amended statement of claim.

5. Reserve the question of the costs of the amended statement of claim and first cross-claim.

6. Direct that the parties file brief written submissions on the question of costs within 14 days, with a view to dealing with the matter on the papers if possible

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Decision last updated: 12 March 2021