Blatchford v Laine

Case [2018] WASC 207

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   IAN TORRINGTON BLATCHFORD as administrator of the estate of the late Voitto Tapio Laine -v- TAPIO HARRY LAINE & ORS

CORAM:   VAUGHAN J

HEARD                   :26 JUNE 2018

SUPPLEMENTARY SUBMISSIONS FILED ON 29 JUNE AND 2 JULY 2018

DELIVERED          :  13 JULY 2018

FILE NO/S:   CIV 3029 of 2017

BETWEEN:   IAN TORRINGTON BLATCHFORD

Plaintiff

AND

TAPIO HARRY LAINE

First Defendant

KIMMO PATRICK LAINE

Second Defendant

LIAM PETER LAINE

Third Defendant

INGA-JENELLE LAINE

Fourth Defendant

LISA MARGARET LAINE

Fifth Defendant

KRISTINA ELLIOTT

Sixth Defendant


Catchwords:

Estate law - Application for directions under Trustees Act 1962 (WA) s 92 - Whether administrator justified in defending claim affecting trust assets - Whether administrator justified in prosecuting 'conditional counterclaim'

Result:

Direction given that the applicant is justified in defending the claim made in action CIV 1309 of 2016 and investigating whether to begin and proceed with a counterclaim in action CIV 1309 of 2016

Legislation:

Administration Act 1903 (WA), s 43(1)(a)
Family Provision Act 1972 (WA)
Trustees Act 1962 (WA), s 92, s 95

Category:    B

Representation:

Counsel:

Plaintiff : P R MacMillan
First Defendant : L A Tsaknis
Second Defendant : C H Thompson
Third Defendant : C H Thompson
Fourth Defendant : C V Eastwood
Fifth Defendant : No appearance
Sixth Defendant : No appearance

Solicitors:

Plaintiff : Pacer Legal
First Defendant : Dwyer Durack
Second Defendant : Nielsen & Co
Third Defendant : Nielsen & Co
Fourth Defendant : Eastwood Law
Fifth Defendant : Cullen Macleod Lawyers
Sixth Defendant : Cullen Macleod Lawyers

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

Abrugiato v Hansen as executor of the estate of Abrugiato [No 2] [2013] WASC 119; (2013) 10 ASTLR 535

Alsop Wilkinson v Neary [1996] 1 WLR 1220

Application of Macedonian Orthodox Community Church St Petka Inc [No 2] [2005] NSWSC 558; (2005) 63 NSWLR 441

Australia and New Zealand Banking Group Ltd v National Mutual Life Nominees Ltd [1977] HCA 42; (1977) 137 CLR 252

Carr v Larussa [2016] WASC 13

Dalrymple v Melville (1932) 32 SR (NSW) 593

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

In re Dallaway (Dec) [1982] 1 WLR 756

In re Evans [1986] 1 WLR 101

Laine v Laine [2016] WASC 401

Lathwell v Lathwell [2008] WASCA 256 (S)

Macedonian Orthodox Community Church St Petka Inc v His Eminence Petar The Diocesan Bishop of Macedonian Orthodox Diocese of Australia and New Zealand [2008] HCA 42; (2008) 237 CLR 66

Plan B Trustees Ltd v Parker [No 2] [2013] WASC 216; (2013) 11 ASTLR 242

Re A George Bond & Co Ltd (1932) SR (NSW) 301

Re Addstone Pty Ltd (1997) 25 ACSR 357

Re Atkinson (Dec) [1971] VR 612

Re Estate of Anastasios Keriacules Challis (Dec) [2010] WASC 333

Re Lemon Tree Passage and Districts RSL and Citizens Club Co-operative Ltd (1987) 11 ACLR 796

Re Woodings [2017] WASC 322; (2017) 125 ACSR 200

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Blatchford v Laine [2018] WASC 207
Case
[2018] WASC 207
Decision Date

CaseChat Overview and Summary

The case of Blatchford v Laine involves Mr Blatchford, the administrator of the estate of the late Mr Voitto Laine, and Mr Laine's children from his two marriages. The primary dispute centres on whether Mr Blatchford is justified in defending a claim against the estate and whether he is justified in pursuing a conditional counterclaim against one of the defendants, Tapio Laine. The legal issues before the court included determining whether Mr Blatchford's actions in defending the claim and potentially pursuing a counterclaim were in the best interests of the estate. The court had to consider the statutory framework under the Trustees Act 1962 (WA) and assess the merits and justification of Mr Blatchford's proposed actions.

The court addressed the legal issues by evaluating the evidence and submissions presented by the parties. It found that Mr Blatchford was justified in defending the claim made by Tapio Laine, as the estate had a valid interest in the outcome of the case. Furthermore, the court considered it appropriate for Mr Blatchford to investigate the possibility of a counterclaim against Tapio Laine, as the evidence suggested that income from the estate had been diverted without benefit to the estate. The court emphasised the importance of protecting the estate's assets and ensuring that all income was properly accounted for.

In conclusion, the court directed that Mr Blatchford was justified in defending the claim and investigating the possibility of a counterclaim. The court ordered that Mr Blatchford could proceed with identifying the amount to be claimed, obtaining legal advice on the prospects of success, and preparing a draft counterclaim. The court also addressed the costs of the application, fixing the costs of certain defendants and directing that other costs would be taxed on a solicitor and client basis, to be paid from the estate of the late Mr Voitto Laine.

Orders

Orders of the court

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Background

Background to the litigation

Background facts With the exception of Mr Blatchford, the parties to the proceedings are the children of the late Mr Voitto Laine. With one exception they bear his surname. To avoid confusion, from this point I will generally refer to them by their Christian name. I mean no disrespect by doing so. The same approach was adopted by most counsel in their written submissions. The late Mr Voitto Laine was survived by six children from two marriages. His children from the first marriage were Tapio (the first defendant), Kristina Elliott (the sixth defendant) and Lisa Laine (the fifth defendant). Kristina and Lisa were served with Mr Blatchford's application but gave notice that they intended to abide the court's decision. The children from the second marriage were Kimmo Laine (the second defendant), Liam Laine (the third defendant) and Inga-Jenelle Laine (the fourth defendant - who I will refer to as 'Jenelle'). Kimmo and Liam appeared by the same counsel at the hearing of the application. Jenelle was separately represented. Mr Voitto Laine left a large estate. The papers relied on in the application refer to five different statements of assets and liabilities. The most recent statement of assets and liabilities values the estate's net assets as at the time of Mr Laine's death in an amount of some $8.656 million. As at 8 June 2017 the net value of the estate was estimated by Mr Blatchford to be in the order of $7.703 million. The estate includes:·a fishing vessel known as the 'Kilaine II' ‑ valued at $100,000; and·concession licences described as 'Western Rock Lobster concession attached to WCLL 1436 - 870 A zone units and 383 B zone units (87 pots)' - valued at $6.09 million. The concession licences are also referred to in the papers as 'Managed Fishery Licence (MFL) 1436' and its attached entitlements ‑ comprising 67 pots. There are an additional 20 pots that were acquired by Mr Voitto Laine in 2009 and are also attached to MFL 1436. Mr Blatchford's investigations support a conclusion that since the death of Mr Voitto Laine all income from the 87 pots have been paid to a partnership between Tapio and his wife. The suggestion is that the pots have been leased. In any case no income has been received for the benefit of the deceased estate. This apparent diversion of income from the estate is the intended subject of the proposed 'conditional counterclaim'. The papers do not allow me to draw any conclusion as to the likely amount of the income that would have been derived from MFL 1436 following Mr Voitto Laine's death in May 2014. Counsel for Mr Blatchford informed me in the course of submissions that the dollar value of the conditional counterclaim was unknown and had not been calculated.[1][1] ts 16, 18. Probate of Voitto Laine's will dated 28 October 1997 and codicil dated 5 November 1997 was granted to Lisa, as executrix, on 10 December 2014. Lisa retained Pacer Legal to act on her behalf as executrix. For reasons which are not presently relevant the grant of probate was revoked and, on 15 June 2017, letters of administration with the will and codicil annexed were granted to Mr Blatchford. Mr Blatchford has continued to retain Pacer Legal.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

Conclusion Subject to hearing from counsel as to the precise form of the orders I will order that:(1)Pursuant to s 92 of the Trustees Act 1962 (WA) it is directed that Mr Blatchford, in his capacity as administrator of the will of the late Voitto Laine, is justified in defending the claim made by Tapio Harry Laine in Supreme Court of Western Australia action CIV 1309 of 2016.(2)Pursuant to s 92 of the Trustees Act 1962 (WA) it is directed that Mr Blatchford, in his capacity as administrator of the will of the late Voitto Laine, is justified in investigating whether to begin and proceed with a counterclaim against Tapio Harry Laine (or any partnership in which he is a partner) in Supreme Court of Western Australia action CIV 1309 of 2016, by:(a)taking steps to identify the amount that may be claimed by him on behalf of the estate of the late Mr Voitto Laine in such a counterclaim;(b)obtaining advice from counsel as to the prospects of success and merits of such a counterclaim; and(c)preparing or causing to be prepared a draft of the proposed counterclaim.(3)Mr Blatchford has liberty to renew his application for directions under s 92 of the Trustees Act 1962 (WA) as to whether he is justified in beginning and proceeding with a counterclaim against Tapio Harry Laine (or any partnership in which he is a partner) in Supreme Court of Western Australia action CIV 1309 of 2016.(4)Kimmo and Liam's costs of the application are fixed in the amount of $16,000 and are to be paid forthwith out of the assets of the estate of the late Mr Voitto Laine.(5)Jenelle's costs of the application are to be taxed on a solicitor and client basis (with notice of the taxation to be provided to the other parties) and are to be paid forthwith out of the assets of the estate of the late Mr Voitto Laine. I will hear from counsel for Mr Blatchford and Tapio whether their clients wish to make an application under s 280(2) of the Legal Profession Act 2008 (WA). If not, I will order that Mr Blatchford's and Tapio's costs of the application are to be paid from the estate of the late Mr Voitto Laine, those costs to be taxed on a solicitor and client basis (with notice of the taxation to be provided to the other parties).

Ratio Decidendi

Legal Principle Established

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