Campbell v Hemmings

[2015] NSWSC 1592

Supreme Court

New South Wales

• Amendment notes

Medium Neutral Citation:	Campbell v Hemmings [2015] NSWSC 1592
Hearing dates:	22 October 2015
Decision date:	29 October 2015
Jurisdiction:	Equity
Before:	Kunc J
Decision:	Order for provision made
Catchwords:	FAMILY PROVISION AND MAINTENANCE – Claim by adult only child where entire estate left to great grandchildren - Succession Act 2006, ss 59, 60, 66
Legislation Cited:	Succession Act 2006 (NSW)
Cases Cited:	Camernik v Reholc [2012] NSWSC 1537 Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72 Verzar v Verzar [2014] NSWCA 45 West v Mann [2013] NSWSC 1852
Category:	Principal judgment
Parties:	Denver Campbell (Plaintiff) Andrew Jackson Hemmings as executor of the will of John Bernard Jackson (First defendant) Kaine Anthony Devine as executor of the will of John Bernard Jackson (Second defendant)
Representation:	Counsel: M. Pringle (Plaintiff) G. Waugh and M. Fleeton (First and Second Defendants)   Solicitors: Bale Boshev Lawyers (Plaintiff) W.A. Baxter & Co. Pty Ltd (Defendants)
File Number(s):	2013/381284
Publication restriction:	No

Judgment

Summary

1. The plaintiff is Ms Denver Campbell. She is now 48 years old and is the only child of the late John Bernard Jackson (“Mr Jackson”). He died on 26 October 2013 at the age of 75. Without disrespect, I shall refer to the plaintiff and several others who feature in this judgment by their given names.

2. Mr Jackson made his will on 14 June 2011 (the “Will”). He made no provision for Denver and left almost his entire estate to two of his great-grandchildren, Rhiannon (now aged nearly 11) and Ashton (now aged 9).

3. In addition to Denver, Mr Jackson’s partner, Ms Deanna Cummins, is the only eligible beneficiary in the estate. Family provision proceedings brought by Deanna have been settled.

4. Mr Jackson’s estate (the “Estate”) had a sworn value for probate of approximately $830,000.

5. By summons filed on 19 December 2015 Denver applies for provision out of the Estate under s 59 of the Succession Act 2006 (NSW) (the “Act”). Ms M. Pringle of Counsel appeared for Denver. Mr G. Waugh of Counsel appeared with Ms M. Fleeton of Counsel for the defendant executors of the Will, who are Mr Jackson’s nephew and great-nephew.

6. The only matter in issue was the amount of provision that should be ordered for Denver. The Court has decided she should receive provision of $350,000. There will be a consequential adjustment to the rights of Rhiannon and Ashton.

The Act

7. Part 3.2 of the Act deals with family provision orders. Division 1 of that part identifies, in s 57, who are “eligible persons who may apply to the Court for a family provision order in respect of the estate of a deceased person”. Section 58(2) requires an application for a family provision order to “be made not later than 12 months after the date of the death of the deceased person, unless the Court otherwise orders on sufficient cause being shown”.

8. Division 2 of Part 3.2 of the Act deals with determination of applications for family provision orders. For the purposes of these proceedings, the relevant provisions are:

59(1) The Court may, on application under Division 1, make a family provision order in relation to the estate of a deceased person, if the Court is satisfied that:

(a) the person in whose favour the order is to be made is an eligible person, and

(b) in the case of a person who is an eligible person by reason only of paragraph (d), (e) or (f) of the definition of “eligible person” in section 57 – having regard to all the circumstances of the case (whether past or present) there are factors which warrant the making of the application, and

(c) at the time when the Court is considering the application, adequate provision for the proper maintenance, education or advancement in life of the person in whose favour the order is to be made has not been made by the will of the deceased person, or by the operation of the intestacy rules in relation to the estate of the deceased person, or both.

59(2) The Court may make such order for provision out of the estate of the deceased person as the Court thinks ought to be made for the maintenance, education or advancement in life of the eligible person, having regard to the facts known to the Court at the time the order is made.

…

60(1) The Court may have regard to the matters set out in subsection (2) for the purpose of determining:

(a) whether the person in whose favour the order is sought to be made (the "applicant") is an eligible person, and

(b) whether to make a family provision order and the nature of any such order.

60(2) The following matters may be considered by the Court:

(a) any family or other relationship between the applicant and the deceased person, including the nature and duration of the relationship,

(b) the nature and extent of any obligations or responsibilities owed by the deceased person to the applicant, to any other person in respect of whom an application has been made for a family provision order or to any beneficiary of the deceased person’s estate,

(c) the nature and extent of the deceased person’s estate (including any property that is, or could be, designated as notional estate of the deceased person) and of any liabilities or charges to which the estate is subject, as in existence when the application is being considered,

(d) the financial resources (including earning capacity) and financial needs, both present and future, of the applicant, of any other person in respect of whom an application has been made for a family provision order or of any beneficiary of the deceased person’s estate,

(e) if the applicant is cohabiting with another person – the financial circumstances of the other person,

…

(g) the age of the applicant when the application is being considered,

(h) any contribution (whether 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 or the deceased person’s family, whether made before or after the deceased person’s death, for which adequate consideration (not including any pension or other benefit) was not received, by the applicant,

(i) any provision made for the applicant by the deceased person, either during the deceased person’s lifetime or made from the deceased person’s estate,

(j) any evidence of the testamentary intentions of the deceased person, including evidence of statements made by the deceased person,

…

(l) whether any other person is liable to support the applicant,

(m) the character and conduct of the applicant before and after the date of the death of the deceased person,

(n) the conduct of any other person before and after the date of the death of the deceased person,

…

(p) any other matter the Court considers relevant, including matters in existence at the time of the deceased person’s death or at the time the application is being considered.

9. In West v Mann [2013] NSWSC 1852 at [9]-[11] I explained the reasons for the approach I adopt to applications under the Act. That is how I will proceed in this case.

10. By reference to the language of the Act, the questions and issues which the Court must take into account are:

1. Is the person who has applied to the Court for a “family provision order” (as defined in s 3 of the Act) an eligible person under s 57 of the Act? In accordance with s 60(1)(a), the Court may (not must) have regard to the matters set out in s 60(2) in determining whether that person is an eligible person. It is not readily apparent how many of those matters could be relevant to the issue of eligible person, but nothing turns on that observation.

2. If the answer to question (1) is “yes”, has the application been filed in the Court’s Registry not later than 12 months after the deceased’s death (ss 58(2) and (3))?

3. If the answer to question (2) is “no”, has the eligible person who has brought the application shown sufficient cause for the Court to order otherwise to extend the date for the filing of the application in the Court’s Registry (ss 58(2) and (3))?

4. If the answer to question (2) is “yes” or the Court has otherwise ordered under s 58(2), is the Court satisfied that the person in whose favour the order is to be made (the “applicant”) is an eligible person (s 59(1)(a))? In reaching the requisite state of satisfaction the Court may (not must) have regard to the matters set out in s 60(2). As a theoretical matter this question admits of the possibility that “the person in whose favour the order is to be made” is not the person who has brought the application (in which case, the latter must also be an eligible person).

5. If the answer to question (4) is “yes”, what provision has been made for the proper maintenance, education or advancement in life of the applicant by the deceased’s will or by the operation of the intestacy laws (the “Provision”)?

6. Is the Court satisfied, at the time when the Court is considering the application, that the Provision is not adequate for the proper maintenance, education or advancement in life of the applicant?

7. If the answer to question (6) is “yes” (i.e. the Court is satisfied the Provision is not adequate for the specified purpose) then the Court’s discretion conferred by the chapeau to s 59(1) to make a family provision order in favour of the applicant (the “Discretion”) is enlivened.

8. Once the Discretion is enlivened then, noting s 59(2), what provision, if any, does the Court think ought to be made for the proper maintenance, education or advancement in life of the applicant, having regard to the facts known to the Court at the time the order is made (the “Proposed Provision”)? This is an evaluative judgment which arises from the word “ought” and requires examination of the applicant’s needs. In making this judgment the Court may (not must) have regard to the matters set out in s 60(2) (“the nature of any such order”: s 60(1)(b)).

9. Having answered question (8), should the Court exercise the Discretion to make an order for the “Proposed Provision”? In deciding whether to exercise the Discretion to make such an order, the Court may (not must) have regard to the matters set out in s 60(2) (“whether to make a family provision order”: s 60(1)(b)).

10. Section 60(2) provides a helpful checklist but it is no more than that. The Court is not obliged to take those matters into account. The extent to which it does (if at all) will depend upon the facts of each particular case.

11. Section 60(2)(p) confirms the breadth of matters the Court can take into account. Once enlivened, the Discretion is expressly fettered only by the requirement in s 59(2) that if an order is made, it must be such order “as the Court thinks ought to be made for the maintenance, education or advancement in life of the eligible person, having regard to the facts known to the Court at the time the order is made”. The Discretion is otherwise unconfined, which means that in answering question (8) the Court is otherwise constrained only by the need to act judicially, that is to say “not arbitrarily, capriciously or so as to frustrate the legislative intent”: Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72 at [22] per Gaudron and Gummow JJ. The Court must act rationally and exercise the Discretion for the purpose for which it was conferred.

11. Having identified what I consider to be the correct approach under the Act to an application of this kind, I will set out the facts. They were not in dispute.

The Will and Deanna’s proceedings

12. Ignoring the currently irrelevant substitutionary gifts, the Will made the following bequests:

1. Deanna received a right to reside in Mr Jackson’s Muswellbrook house (the “House”) until Rhiannon turns 18. While Deanna has an obligation under the Will to keep the House in good repair and condition, the cost of rates, taxes, statutory outgoings and insurance are to the account of the Estate.

2. Rhiannon receives the House and its contents when she reaches 18 years of age.

3. Rhiannon and Ashton receive Mr Jackson’s superannuation fund in equal shares upon reaching 25 years of age.

4. Rhiannon and Ashton receive the residue of the Estate in equal shares upon reaching 25 years of age.

5. Mr Jackson’s grandson Robert (currently 26 years old) received Mr Jackson’s tools.

13. The Will also provided:

6. I have not provided for my daughter DENVER CAMPBELL because I have already given her One Hundred Thousand Dollars ($100,000.00) in or about 2003.

14. Deanna brought family provision proceedings in this Court. Those proceedings were settled on terms that Deanna received the right of residence in the House in accordance with the Will and payment of her legal costs.

15. Deanna is currently living in the House. The parties accepted that she is entitled to do so until the first to occur of her death or Rhiannon’s 18th birthday (9 November 2022). These proceedings were conducted by the parties on the basis that the Court should not make any order that would upset Deanna’s right to reside in the House in accordance with the agreement that had been reached to settle her proceedings.

The Estate

16. The Estate now comprises:

1. The House valued at $235,000.

2. $512,928.92 held on trust by the defendants’ solicitors (including $475,867.58 comprising Mr Jackson’s superannuation).

3. Shares in listed companies valued at $35,064.19.

4. Furniture and personal effects said to be worth about $10,000, but to which the parties agreed the Court should ascribe no value for the purpose of these proceedings.

17. Setting aside the House, which is currently occupied by Deanna, the value of the Estate in cash and shares is $547,993.11. The parties accepted that the unpaid further legal costs (including the costs of the hearing) for Denver (on the ordinary basis) and for the defendants (on the indemnity basis), will total $113,985.25. The parties had calculated the outstanding costs on the basis of a two day hearing, whereas in fact the proceedings were able to be concluded in one day. As no alternative estimates for legal costs were provided, the Court will nevertheless use the figures provided by the parties. It makes no difference to the Court’s approach that the legal fees will in fact be reduced by the equivalent of one hearing day.

18. Taking into account the unpaid legal costs and ignoring the value of the House, the net distributable value of the Estate is $434,007.86. However, in considering that figure, it must not be forgotten that the Will provides for the Estate to pay some of the outgoings on the House for the next seven years. Neither party led any evidence which would allow the Court to make a finding as to how much that is likely to be. The Court can do no more than take the fact of that liability of the Estate into account and it has done so in determining the outcome of these proceedings.

Denver

19. Denver is 48 years old. She is the only child of her parents and lived with them until she was 18 years old, when she met her former husband. The birth of her children and the circumstances of her marriage to her former husband are set out in paragraphs [31] to [32] below.

20. It was common ground that Denver enjoyed a close relationship with Mr Jackson as both a child and an adult. There is no suggestion of an estrangement or what used to be called disentitling conduct.

21. The only explanation for Mr Jackson having excluded Denver from his testamentary bounty that has any solid foundation in the evidence is the explanation given in the Will itself, namely that he had given her $100,000 towards a home during his lifetime. Denver acknowledged receiving that money. She applied it to purchasing a home with her former husband. However, as a consequence of further borrowings and their ultimate financial position at the time of their divorce, Denver only received $10,000 from the mortgagee’s sale of the property.

22. There is evidence that after suffering two serious strokes before the date of the Will, Mr Jackson became increasingly difficult and less rational. However, it was not suggested that he lacked testamentary capacity at the time of making the Will. On the contrary, while some might disagree with it, there was a clear rationale in the Will. Knowing the circumstances of his various family members (see paragraphs [30]-[37] below), it is entirely understandable, and the Court infers, that Mr Jackson took the view that it was Rhiannon and Ashton who both needed and were likely to benefit most from the proceeds of the Estate.

23. Denver is currently employed as an endorsed enrolled nurse with the Hunter New England Area Health Service, working at Cessnock District Hospital. She achieved that qualification in 2010 from Gunnedah TAFE. This required 12 months study and 780 hours of unpaid work.

24. Denver has a de facto partner, Mr Kevin Royan, who is 54 years old and is a self-employed carpenter.

25. Denver and Kevin’s joint income is approximately equivalent to their joint expenses.

26. Denver and Kevin currently rent a small, one room cottage on a property about 15 minutes out of Cessnock. The property is 120 acres and they are living there because of what Denver describes as her one indulgence, being her ownership of a horse.

27. Although Denver has some problems with her health, they do not impede her capacity to work. Nor was there any evidence that those health problems would become more serious or have that effect in the future. The only evidence in that regard was Denver’s own statement to the effect that nurses frequently retired early as a result of injuries they suffered in the course of their duties, which often involved lifting patients.

28. Denver has $6,500.00 in assets including a 10 year old car which has now travelled 170,000 kilometres. She has no liabilities and has superannuation of $38,000.

29. Kevin has assets including a car of approximately $9,000 and $30,000 in debts. Kevin does not have any significant superannuation savings.

The family

30. As the Court has already noted, Denver is the only child of Mr Jackson and his late wife, Fay. Fay died in 2001.

31. In 1992 Denver married Mr Mark Campbell, with whom she had been living for several years. Denver and Mark separated in March 2010 and a decree absolute dissolving their marriage was granted in 2013.

32. Denver and Mark had two children, Nikarlie (born 1986) and Robert (born 1989).

33. Nikarlie (Mr Jackson’s granddaughter) has three children: Rhiannon (born 2004), Ashton (born 2006) and Imogen. Imogen has no part in these proceedings because she was only born in April 2015.

34. Rhiannon’s father is a former partner of Nikarlie’s. He plays no part in the life of his daughter.

35. Ashton and Imogen are the children of Nikarlie’s current partner, Mr Scott Chalmers.

36. There was very little evidence of Rhiannon’s and Ashton’s circumstances and needs or those of their mother, Nikarlie. Based on such evidence as there was, the Court is able to conclude that Rhiannon and Ashton live in somewhat straitened circumstances. Both Nikarlie and Scott are unemployed and receive Centrelink benefits. They live in rented accommodation. They own a Holden car. Neither has any vocational qualifications although Scott occasionally assists his father in the latter’s plumbing business. Nikarlie has, since shortly after the birth of Rhiannon, suffered from quite serious epilepsy which Nikarlie declines to control with medication. Rhiannon and Ashton attend the local State school in Muswellbrook.

37. Rhiannon and Ashton enjoyed a close relationship with their great-grandfather, Mr Jackson. Their school shared a common boundary with the back of the House and Rhiannon would sometimes come to the dividing fence and bash on it until Mr Jackson came to speak to her. There was clear, undisputed evidence that Mr Jackson was “besotted” with Rhiannon.

Uncontroversial matters

38. Because Denver is Mr Jackson’s daughter, she is an eligible person under s 57 of the Act. The summons was filed less than 12 months after Mr Jackson’s death. It follows that the questions set out in sub-paragraphs (1), (2) and (4) of paragraph [10] above are all answered “yes”.

38. The Provision referred to in the question posed in sub-paragraph [10(5)] above is nil.

Has adequate provision not been made for Denver?

40. It is next necessary to consider what is sometimes referred to as the jurisdictional question. This is set out in sub-paragraph [10(6)] above, namely whether the Court is satisfied, at the time when the Court is considering the application, that the Provision for Denver is not adequate for her proper maintenance, education or advancement in life. If that question is answered “yes”, then the Court’s discretion to make a family provision order in favour of Denver is enlivened.

41. In this case the parties were agreed that the question should be answered “yes”. However it remains useful to set out the law in relation to claims by adult children as it is also relevant to the question of what provision should be ordered.

42. In Verzar v Verzar [2014] NSWCA 45, Meagher JA (with whom Macfarlan and Barrett JJA agreed) summarised the legal principles governing this stage of the inquiry:

39. The primary judge concluded that Stephen's will did not make adequate provision for the respondent's proper maintenance, education and advancement in life. Whether such provision has been made requires an assessment of the applicant's financial position, the size and nature of the deceased's estate, the relationships between the applicant and the deceased and other persons who have legitimate claims upon his or her bounty and the circumstances and needs of those other persons: see Tobin v Ezekiel [2012] NSWCA 285; 83 NSWLR 75 at [70] and McCosker v McCosker [1957] HCA 82; 97 CLR 566 at 571-572; Singer v Berghouse [1994] HCA 40; 181 CLR 201 at 210; and Vigolo v Bostin [2005] HCA 11; 221 CLR 191 at [16], [75], [112]. Such an assessment is necessary because of the inter-relation between "adequate provision" and "proper maintenance". Whilst the inquiry as to what is "adequate" directs particular attention to the needs of the applicant, what is "proper" requires regard to all the circumstances of the case, and in particular the size and nature of the estate and the needs of the other beneficiaries or potential beneficiaries. As was observed by Sackville AJA in Foley v Ellis [2008] NSWCA 288 at [88], a court cannot consider the propriety and adequacy or inadequacy of any testamentary provision for an applicant in isolation from the resources and needs of the other claimants on the deceased's bounty.

43. In addition to the passage from Verzar quoted in the preceding paragraph I also respectfully adopt what Hallen J said in Camernik v Reholc [2012] NSWSC 1537 both as to the general approach to be adopted to applications for family provision and judicial observations concerning claims by adult children:

154. Yet, in considering the question, the nature and content of what is adequate provision for the proper maintenance, education or advancement in life of an applicant, is not fixed or static. Rather, it is a flexible concept, the measure of which should be adapted to conform with what is considered to be right and proper according to contemporary accepted community standards: Pontifical Society for the Propagation of the Faith v Scales at 19; Walker v Walker (NSWSC, Young J, 17 May 1996, unreported); Vigolo v Bostin at 199 and 204; Stern v Sekers; Sekers v Sekers [2010] NSWSC 59.

155. An important consideration is whether, in all the circumstances, the community expectation would be for greater benefaction to have been made for the proper or adequate provision of the person seeking provision. Gleeson CJ observed in Vigolo v Bostin, at 199, that the justification for interference with freedom of testation is to be found in the failure of a deceased to meet the obligations, which the community would expect in terms of maintenance, for those persons within the class of eligible persons. The process requires the court to "connect the general but value-laden language of the statute to the community standards".

156. As Allsop P said in Andrew v Andrew, at [16]:

"If I may respectfully paraphrase Sheller JA [in Permanent Trustee Co Limited v Fraser (1995) 36 NSWLR 24 at 46F-47B], the Court in assessing the matter at s 59(1) and the order that should be made under s 59(1) and (2), should be guided and assisted by considering what provision, in accordance with prevailing community standards of what is right and appropriate, ought to be made. This, Sheller JA said ... involved speaking for the feeling and judgment of fair and reasonable members of the community. It is to be emphasised that s 59(1)(c) and s 59(2) refer to the time when the Court is considering [an application for a family provision order] and the facts then known to the Court. The evaluative assessment is to be undertaken assuming full knowledge and appreciation of all the circumstances of the case. This ... makes the notion of compliance by the testator with a moral duty (on what he or she knew) apt to distract from the statutory task of the Court."

157. In all cases under the Act, what is adequate and proper provision is necessarily fact specific. An inflexible approach cannot be taken in assessing the questions to be answered.

158 The Act is not a "Destitute Persons Act", and it is not necessary, therefore, that the applicant should be destitute to succeed in obtaining an order: In re Allardice, Allardice v Allardice (1909) 29 NZLR 959 at 966.

159. In relation to a claim by an adult child, the following principles are useful to remember:

(a) The relationship between parent and child changes when the child leaves home. However, a child does not cease to be a natural recipient of parental ties, affection or support, as the bonds of childhood are relaxed.

(b) It is impossible to describe in terms of universal application, the obligation, responsibility, or community expectation, of a parent in respect of an adult child. It can be said that, ordinarily, the community expects parents to raise, and educate, their children to the very best of their ability while they remain children; probably to assist them with a tertiary education, where that is feasible; where funds allow, to provide them with a start in life, such as a deposit on a home, although it might well take a different form. The community does not expect a parent, in ordinary circumstances, to provide an unencumbered house, or to set his, or her, children up in a position where they can acquire a house unencumbered, although in a particular case, where assets permit and the relationship between the parties is such as to justify it, there might be such an obligation: McGrath v Eves [2005] NSWSC 1006; Taylor v Farrugia [2009] NSWSC 801.

(c) Generally, also, the community does not expect a parent to look after his, or her, child for the rest of the child's life and into retirement, especially when there is someone else, such as a spouse, who has a primary obligation to do so. Plainly, if an adult child remains a dependent of a parent, the community usually expects the parent to make provision to fulfil that ongoing dependency after death if he or she is able to do so. But where a child, even an adult child, falls on hard times, and where there are assets available, then the community may expect a parent to provide a buffer against contingencies; and where a child has been unable to accumulate superannuation or make other provision for their retirement, something to assist in retirement where otherwise they would be left destitute: Taylor v Farrugia.

(d) If the applicant has an obligation to support others, such as a parent's obligation to support a dependent child, that will be a relevant factor in determining what is an appropriate provision for the maintenance of the applicant: Re Buckland Deceased [1966] VicRp 58; [1966] VR 404 at 411; Hughes v National Trustees Executors and Agency Co. of Australasia Ltd [1979] HCA 2; (1979) 143 CLR 134 at 148; Goodman v Windeyer at 498, 505. But the Act does not permit orders to be made to provide for the support of third persons to whom the applicant, however reasonably, wishes to support, where there is no obligation to support such persons: Re Buckland Deceased at 411; Kleinig v Neal (No 2) [1981] 2 NSWLR 532 at 537; Mayfield v Lloyd-Williams, at [86].

(e) There is no need for an applicant adult child to show some special need or some special claim: McCosker v McCosker; Kleinig v Neal (No 2), at 545; Bondelmonte v Blanckensee [1989] WAR 305; and Hawkins v Prestage (1989) 1 WAR 37 per Nicholson J at 45.

(f) The adult child's lack of reserves to meet demands, particularly of ill health, which become more likely with advancing years, is a relevant consideration: MacGregor v MacGregor [2003] WASC 169 (28 August 2003) at [181], [182]; Crossman v Riedel [2004] ACTSC 127 at [49]. Likewise, the need for financial security and a fund to protect against the ordinary vicissitudes of life, is relevant: Marks v Marks [2003] WASCA 297 at [43]. In addition, if the applicant is unable to earn, or has a limited means of earning, an income, this could give rise to an increased call on the estate of the deceased: Christie v Manera [2006] WASC 287; Butcher v Craig [2009] WASC 164 at [17].

(g) The applicant has the onus of satisfying the court, on the balance of probabilities, of the justification for the claim: Hughes v National Trustees, Executors and Agency Co of Australasia Ltd at 149.

What provision ought to be made for Denver?

44. Because the parties were agreed that some provision should be made for Denver, the argument proceeded by reference to the several categories of need which she had identified. However, the first submission put on her behalf was that she should receive the whole Estate because she was Mr Jackson’s only child. It is sufficient to reject that submission by noting that, even taken at its most generous from her point of view, the evidence did not disclose that Denver had needs that would consume the entire Estate.

45. It is convenient then to turn to each of the categories of need that was identified on Denver’s behalf.

46. In considering each of those needs I have considered each of the matters set out in s 60(2) of the Act reproduced in paragraph [8] above when applied to the undisputed facts recorded above. However, two matters have been of special importance and inform the Court’s approach to each of the needs identified by Denver. I set these out here rather than repeating them in relation to each need dealt with below:

1. The size of the Estate in the context of:

1. the parties’ agreement that Deanna’s occupation of the House should not be disturbed;

2. the absence of any submission that some part of Deanna’s provision should come later from that part of the Estate represented by the House;

3. the need to preserve a fund to meet the outgoings of the House which remain to the Estate’s account.

2. The fact that Mr Jackson’s preference for his great grandchildren was not capricious or irrational (see paragraph [22] above). On the evidence it is clear in relation to Rhiannon and Ashton as beneficiaries (not eligible persons) that neither their mother nor grandmother (either in their own right or with their current partner) has much capacity to provide for their maintenance, education or advancement in life.

Accommodation

47. Denver informed the Court that she needed accommodation which, given her employment and other circumstances, should be in Cessnock. Denver gave evidence that if she was to receive money from the Estate in order to purchase her own accommodation, she would do so jointly with Kevin. She said she wanted a three bedroom house to facilitate visits by her grandchildren.

48. Against this, Mr Waugh submitted for the defendants:

1. The community did not expect a parent to set up an adult child in their own, unencumbered home (see paragraph [43] above).

2. Having already, in effect, set up Denver in her own home once during his lifetime by making the gift of $100,000 to her, community standards did not require Mr Jackson to do so again.

3. If some allowance to purchase accommodation were made, it should be for a lesser amount taking into account that Denver wished to own the home jointly with Kevin. There was no obligation on Mr Jackson to provide Kevin with a home. Denver and Kevin can both contribute to the cost of purchasing a home and servicing any mortgage.

49. The Court is satisfied that, in the circumstances of this case, community standards would, in the light of the size of the Estate and the claims of other beneficiaries, expect Mr Jackson to have provided for Ms Campbell to have an unencumbered interest in a suitable home. For the following reasons the Court is satisfied that provision should be made to enable her to purchase a two bedroom home in the Cessnock area:

1. Denver has demonstrated a need for such accommodation.

2. In many cases there would be much force in Mr Waugh’s submissions that community standards would not require an able bodied woman in full time employment who is in a relationship where her partner also has earning capacity, to be provided with an unencumbered home. However, in this case, that approach must be tempered against the facts that for at least two years (see paragraph [52] below) Denver’s earning capacity may be substantially reduced if she opts for full time study. Furthermore, with her previous matrimonial home having to be sold by a mortgagee and Kevin being a self-employed carpenter, her credit record and their combined circumstances may mean that it would be difficult for them to obtain a mortgage for any significant sum.

3. It was properly conceded by Ms Pringle that while Denver’s desire for a three bedroom home was understandable in order to accommodate her now three grandchildren on visits, that was in the nature of a wish rather than a need. A two bedroom home would meet her needs, including visits from grandchildren, particularly when it has been three years since their last visit and there was no suggestion that future visits would be frequent or lengthy.

50. In her first affidavit she estimated the cost of a “small neat and tidy 2 bedroom house in Cessnock” was $250,000. In a later affidavit this figure became $300,000 and then $350,000.

51. Evidence was tendered as to the price of eight homes in Cessnock. Four were irrelevant either because they were in a part of Cessnock in which Denver gave evidence that she did not wish to live or because they were for three bedroom homes. The average price of the remaining four homes was $254,750.00 which the Court rounds up to $255,000.00. Provision will be ordered in that amount. Given that both Denver and Kevin will, at least in the short term, both be working and will be relieved of the need to pay rent, they should be able to meet any transaction costs from their own resources and, for this reason, the Court makes no additional provision in relation to those costs.

Further education

52. Denver sought approximately $100,000 to enable her to improve her qualifications to that of registered nurse. This amount was calculated by reference to the cost of a two year full time course that she could undertake at the University of New England ($23,000 per annum) plus an amount to compensate her for loss of income while she was studying. This latter component would also cover accommodation, food and text books.

53. While accepting that education was a proper matter for provision under the Act, Mr Waugh submitted that the amount sought was excessive for three reasons:

1. The evidence was that Denver could also undertake the course part time over four years. She had demonstrated a capacity to work and study at the same time in the way she had obtained her current qualifications.

2. Denver’s claim ignored the fact that the costs of her degree could be paid for by HECS which would then be recovered in the usual way from the greater income she would be able to earn with the benefit of the degree.

3. Denver’s claim ignored the fact that she was in a relationship where Kevin had capacity to support their living requirements, particularly if they were relieved from the obligation to pay rent.

54. The Court accepts Mr Waugh’s submissions. Denver’s need for funds to advance her education can be adequately met with less disruption to Mr Jackson’s testamentary scheme by a provision of $50,000. This could meet the whole of the course expenses and provide a small amount towards text books and other expenses if Denver chooses to deploy it in that way. On the other hand, it could also meet many of her living expenses, whether she does the course on a full time or part time basis, given that it is open to her to fund some, if not all, of the course by recourse to HECS.

55. Community standards are satisfied by putting Denver in a position where she is able to organise her affairs so as to undertake the further study but would not extend to an expectation that the entire cost of both study and income foregone are met from the Estate. This must particularly be the case when she is in a relationship with Kevin, who is able to contribute towards their living expenses, especially when they will have their own home and be free from mortgage or rental obligations.

Car

56. Denver currently has a 2005 Ford Focus which has travelled 170,000km. She told the Court that she needed a four wheel drive to enable her to carry feed and other requirements for her horse, which would remain agisted in its current location even if she and Kevin bought a house in Cessnock. The four wheel drive was necessary because access to the agistment property was by a dirt road off the main, sealed road and the property itself had unsealed tracks. Several times a year heavy rain meant that the property could only be reached by four wheel drive.

57. In her first affidavit Denver suggested that it would be sufficient for her to have a second hand four wheel drive diesel utility at a cost of about $25,000-$30,000. In her subsequent evidence she gave an estimate of $40,000 which was based upon the cost of a new Isuzu dual cab utility.

58. Mr Waugh submitted that the claim was excessive, particularly when Kevin had a four wheel drive vehicle to which Denver accepted she could have access from time to time. He also drew to attention that there was evidence that the property on which the horse was agisted might be sold as it is owned by an estate in respect of which probate was soon to be granted.

59. The Court accepts Mr Waugh’s submissions. Denver has demonstrated a need for a new car, not least because she will be undertaking regular commuting between Cessnock and Armidale if she undertakes her further nursing studies at the University of New England. However, a new small car would be sufficient for that purpose. If she wanted to acquire a second hand four wheel drive in addition to Kevin’s for the purpose of enabling her to look after her horse, that is understandable but does not fall into the category of a need. Although the evidence did not descend to this level of detail, the Court is satisfied on the basis of its own knowledge that a provision of $15,000 will be adequate for the purchase of a new small vehicle or a slightly larger second hand one, even if not necessarily a four wheel drive.

Furniture

60. Denver sought $20,000 for household appliances and furniture. She explained that she and Kevin had very few appliances or furniture because they lived in a one room cottage. She had recently bought a small fridge/freezer which, with some difficulty, had been able to be fitted into where they were living. Not unreasonably, she pointed out that if she was able to buy her own home, she would have the space and need for other appliances and furniture.

61. Mr Waugh did not dispute that some provision should be made for such matters. However, in the course of cross-examination it emerged that Denver’s claim of $20,000 was very much a “guesstimate”. When she was asked to list the items she had in mind and describe what she thought to be reasonable prices to them, the total figure did not seem to exceed approximately $10,000. It was also unclear on the evidence what were essential requirements and what were wishes.

60. Provision will be ordered in the amount of $10,000 towards household effects.

Superannuation and vicissitudes

63. Denver claimed a further provision of $100,000 to enable her to supplement her superannuation, supplement her income and to help meet future expenses including unforeseen expenses. Ms Pringle submitted that this part of Denver’s claim was a combined claim for a sum to go towards superannuation and to provide a buffer for vicissitudes.

64. Mr Waugh submitted that no provision should be made in relation to these matters. In particular, he submitted that no amount was required to “top up” Denver’s superannuation in circumstances where, if she obtained a provision for accommodation and to support her further education, her income earning capacity (and, therefore, her capacity to contribute to her own superannuation) would be increased.

65. The Court does not accept that any further provision should be made to allow for a top up to Denver’s superannuation. This is for the reason put by Mr Waugh and the matters referred to in paragraph [46] above. In other cases, where the size of the estate and the particular facts warrant the conclusion that some supplement to an applicant’s superannuation is warranted, there would be no reason why that should not be done. In this case Denver’s capacity to make provision for her own retirement will be enhanced by what the Court proposes to do in any event. In those circumstances the Court is not persuaded that community standards would expect Mr Jackson to have provided a capital sum for additional superannuation.

66. Similar considerations militate against a substantial provision for vicissitudes. The further provision which the Court will make will significantly enhance Denver’s prospects for financial security. She is in a relationship with a partner who is able to provide some income for their mutual benefit. She is in reasonably good health, with, in all likelihood 17 years, or 15 years allowing for two years full time study, of working life ahead of her. In those circumstances only a modest provision for vicissitudes is called for. In the exercise of its discretion the Court will allow $20,000.

67. By reference to the conclusions expressed in paragraphs [51], [54], [59], [62] and [66] above, the answer to the question posed in paragraph [10(8)] above is $350,000. Because Denver’s entitlement to some provision was not in issue, the answer to question [10(9)] above is “yes”.

The position of Rhiannon and Ashton

68. In practical terms the provision which the Court proposes to order will largely be borne by Ashton rather than Rhiannon. This is because the additional provision for Denver will almost entirely come from the proceeds of Mr Jackson’s superannuation, which was otherwise destined to be shared between Rhiannon and Ashton. Because the parties indicated that they did not wish the Court to do anything to disturb Deanna’s occupation of the House and the way in which the case was otherwise argued, the outcome will leave Rhiannon’s entitlement to the House intact notwithstanding the reduction of her share of the superannuation, unless the Court makes some other order.

69. Section 66(2) of the Act provides:

66 Consequential and ancillary orders

…

(2) The Court may make such additional orders as it considers necessary to adjust the interests of any person affected by a family provision order and to be just and equitable to all persons affected by the order.

70. Because of the consequence identified in paragraph [68] above, the Court is satisfied that in order to be just and equitable to Ashton, some adjustment is necessary to the entitlements under the Will to the House, the proceeds of Mr Jackson’s superannuation and the residue of the Estate. Any such adjustment, to ensure a just and equitable outcome for Ashton, will necessarily have to impinge upon Rhiannon’s entitlement to the House. However, the consequential reduction in her overall entitlement is justified by the corresponding improvement in Ashton’s position to overcome the disproportionate effect on Ashton over Rhiannon of the provision order which the Court will make in favour of Denver.

71. The Court accepts Ms Pringle’s submission that if an adjustment of this kind was to be made, the Court would be justified in exercising its discretion in such a way that would recognise Mr Jackson’s intention that the greater part of the balance of the Estate was to go to Rhiannon rather than Ashton. There is nothing in the evidence that would warrant a different approach to favour Ashton. Ms Pringle submitted, and the Court accepts, that an appropriate division, after giving effect to an order for provision in favour of Denver, would be two thirds to Rhiannon and one third to Ashton.

72. In the exercise of its discretion under s 66(2) of the Act, the gifts of the House, Mr Jackson’s superannuation and the residue of the Estate will be adjusted so that each of these will go to Rhiannon as to two thirds and Ashton as to one third upon Ashton reaching the age of 18, provided that if he does not reach the age of 18 Rhiannon is to receive the whole. The reason the Court proposes the gifts to vest on Ashton’s 18th birthday rather than adhere to the age limits prescribed by Mr Jackson is that, in any event, when Ashton turns 18 both he and Rhiannon will be sui juris and would be entitled to call for their gifts. In the meantime, and to the extent they consider it necessary, the defendants have the power to make advances to Rhiannon and Ashton under clause 7.1 of the Will.

Conclusion

73. There will be orders for provision for Denver in the amount of $350,000 and for the adjustment of Rhiannon and Ashton’s rights as set out in paragraph [72] above.

74. The Court will make directions for the parties to endeavour to agree a form of orders giving effect to these reasons and for any argument as to costs to the extent the parties are unable to agree.

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Amendments

05 November 2015 - Change to ages of children, paragraph 2.

05 November 2015 - Change to ages of children, paragraph 2.

Decision last updated: 05 November 2015