Cashen v Cashen

[2001] NSWSC 469

CITATION:	Cashen v Cashen [2001] NSWSC 469
CURRENT JURISDICTION:	Equity Division
FILE NUMBER(S):	SC 5041 of 1999
HEARING DATE(S):	01/06/01
JUDGMENT DATE:	5 June 2001
PARTIES :	Anthony John Cashen v Norman Henry Thomas Cashen and 2 Ors - Estate of Edward John Cashen
JUDGMENT OF:	Master Macready at 1

COUNSEL :	Mr D. Campbell for plaintiff Mr J. Thomson for defendant
SOLICITORS:	Campbell Paton & Taylor for plaintiff McIntosh, McPhillamy & Co for defendant
CATCHWORDS:	Family Provision. Application by nephew who worked for many years on deceased's property. - Order made. No matter of principle.
DECISION:	Paragraph 38

1   MASTER: This is an application under the Family Provisions Act in respect of the estate of the late Edward John Cashen who died on 8 March 1999 aged 71 years. The deceased died intestate and his estate passed to his three brothers who are the defendants in the proceedings. The plaintiff is the deceased's nephew, he being the son of the first defendant.

2   The estate consists of a rural property at Blayney in country New South Wales together with cash of $86,600, plant and equipment probate value of $46,690, and stock of $30,000. There is in evidence a valuation of the land which is in two parcels, separated by the main highway. The total value is $425,000. There was an estimate for probate purposes of $290,000 but given the sworn valuation I will accept the value at $425,000. The costs of the defendant will be $30,000 and those of the plaintiff $31,500. Thus, there is cash left of about $25,000, stock, plant and the land.

3   I will briefly touch on some of the chronology in the matter. The first defendant, Norman Cashen, was born on 13 September 1926. Edward Cashen, his brother, was born on 25 July 1928, and Ernest Clive Cashen, the second defendant, was born on 19 October 1931. Lionel Clyde Cashen, the third defendant, was born on 18 March 1939. The plaintiff was born on 7 October 1950.

4   In the early 1950s the deceased apparently was given a licence to use the property consisting of approximately 45 acres known as "Carinya". The plaintiff at that stage was living with his family on another nearby property and he left school in 1966. Thereafter he is employed at the Blayney Abattoir and from time to time did some work on the deceased's property. Between 1970 and 1973 the plaintiff lived in Western Australia and worked in mining positions in that state. In 1973 the plaintiff came back to Blayney and worked at the abattoir and also did some unpaid work on the deceased's property helping him from time to time. From 1975 to 1985 the plaintiff once again lived and worked in Western Australia, mainly concerned with mining in which he obtained some skills.

5   In 1979 the deceased purchased 300 acres which joined the property known as "Carinya". This area was known as "Willow Glen". On 17 May 1983 the deceased inherited the original property of "Carinya", which he had been using, from his parents.

6   In 1985 the plaintiff came back to Blayney. In that year, he lived on the property "Carinya" in a caravan which was attached to the old homestead for the purposes of taking power. Over the years in 1986 and 1987 the plaintiff started to take over management of the property for the deceased. He carried out a number of improvements, which I will refer to, and worked on the property. This was only in part. Each year he has also worked in Mackay during the season in the sugar cane industry.

7   In 1988 the plaintiff went back to Queensland. Before he got a job the deceased rang him up and asked if he could come back and help him. Accordingly, the plaintiff came back with his caravan and since 1988 has resided permanently back on "Carinya".

8   With the consent of the deceased the plaintiff himself also had some stock which he used on the property as well as increasing the deceased's stock and generally managing it for him. The parties made their income from selling the stock. That supported both of them. Each received their income from the sale of their particular stock. In addition, there was also grown some lucerne on the flats beside the creek which was used for the stock. In 1994 the plaintiff purchased some equipment so that it could be used in the lucerne production on the property. The deceased purchased a tractor and said he proposed to give it to the plaintiff. Similarly, in 1997 the deceased purchased a hay baler and gave it to the plaintiff so that he could do some contract hay cutting.

9   In early 1999 there was for sale a small area of a church which is adjacent to the homestead and surrounded by the land in the homestead. That was purchased by the deceased for $6,000 and it was given to the plaintiff. The plaintiff paid stamp duty and legal costs. The idea was for the deceased and plaintiff to do it up and then move into it on a permanent basis. That did not happen except for the construction of a new tank stand and associated lines.

10   The deceased died on 8 March 1999 and letters of administration granted to the defendants. Since then the plaintiff has continued to operate and maintain the property being reimbursed by the Estate for general expenses but not his labour.

11   For the plaintiff to be able to succeed it is necessary that he show that he is an eligible person as part of the household of the deceased and either wholly or partly dependent on the deceased. This matter is not really in dispute. The fact of the matter is that from 1988 the deceased asked him to come and live with him in the house but the plaintiff preferred to live in his own caravan. That was attached to the house by a power line from the house. There was a household as the plaintiff would do more and more of the domestic work around the house until it reached the point where he was doing all the cooking and washing for both himself and the deceased, his uncle. He also provided companionship to the deceased.

12   In these circumstances I am satisfied that he is an eligible person. It is also necessary, under section 9(1) of the Family Provisions Act, that the Court should determine whether there are factors warranting the making of the application. This expression has been dealt with by courts on a number of occasions. In Re Fulop Deceased (1987) 8 NSWLR 679 at 681 McLelland J, as he was then, described that expression in the following terms:

"Secondly, the subsection appears to be premised upon a distinction between factors which warrant the making of the application on the one hand, and circumstances which would justify the making of an order granting the application, on the other; otherwise the subsection would be pointless. This means that in a particular case the Court might determine that all are factors which warrant the making of the application within the meaning of the subsection, and yet go on to decide that the application should fail. Since the subsection applies only to certain classes of applicants, it suggests that those classes of applicants need to demonstrate some basis for their claims additional to that required of other classes. The difference between the two sets of classes of applicants, in broad terms, seems to be that the classes not affected by s9(1) (lawful and de facto spouses and children) are as such generally regarded as natural objects of testamentary recognition by a deceased (of the Wills Probate and Administration Act 1898, s61B), whereas the classes affected by s9(1) (former spouses, and some time dependent grandchildren or household members) are as such not generally so regarded. This suggests that the factors referred to in the subsection are factors which when added to the facts which render the applicant an eligible person give him or her status of a person who would be generally regarded as a natural object of testamentary recognition by a deceased. That the subsection is directed at a plaintiff's status as applicant in some such sense as this perhaps finds some support in the statutory direction to the Court, in the events that it determines the preliminary question adversely to the plaintiff, not to go on to determine the application, but refuse to proceed with the determination of the application."

13   There are a number of matters referred to in the evidence where the deceased has indicated an intention to benefit the plaintiff as a result of the work that the plaintiff had done for the deceased without any payment. There was the purchase of the spray unit and tractor and the hay baler which I have earlier referred to. There were discussions, from time to time, by the plaintiff, about the consequences of the plaintiff remaining with the deceased rather than doing his mining work which was fairly remunerative, and the deceased indicated that he would get paid in the long run. There was the proposal by the deceased for the change to the church and the giving of that to the plaintiff which is clearly a provision for the plaintiff, intention to benefit him. The project was certainly a recognition of the life that the two of them had together, certainly from 1985 on a part time basis and on a full time basis since 1988. There are reports in the evidence from other people who have indicated that the deceased intended to benefit the plaintiff.

14   I am satisfied on the traditional test that there are factors warranting the making of the application. I therefore move to see that there are prospects of success and if I am satisfied on that matter I would find factors warranting under section 9(1). An application under the Family Provisions Act the High Court has recently in Singer v Berghouse (1994) 181 CLR 201 set out the stage the Court must take, page 209:

"The first question is was the provision (if any) made for the applicant inadequate for (his or her) proper maintenance, education, and advancement in life? The difference between adequate and proper and the interrelationship which existed between adequate provision and proper maintenance et cetera were explained in Bosch v Perpetual Trustee Co Ltd . The determination of the first stage in the two-stage process calls for an assessment of whether the provision (if any) made was inadequate or what, in all the circumstances, was the proper level of maintenance et cetera appropriate for the applicant having regard, amongst other things, to the applicant's financial position, the size and nature of the deceased's estate, the totality of the relationship between the applicant and the deceased, and the relationship between the deceased and other persons who have legitimate claims upon his or her bounty.

The determination of the second stage, should it arise, involves similar considerations. Indeed, in the first stage of the process the Court may need to arrive at an assessment of what is the proper level of maintenance and what is adequate provision, in which event, if it becomes necessary to embark upon the second stage of the process, that assessment will largely determine the order which should be made in favour of the applicant. In saying that, we are mindful that there may be some circumstances in which a court could refuse to make an order notwithstanding that the applicant is found to have been left without adequate provision for proper maintenance. Take, for example, a case like Ellis v Leeder where there were no assets from which an order could reasonably be made and making an order could disturb the testators arrangements to pay creditors."

15   I turn to the plaintiff's position. He is single, presently aged 50 years of age. He has some assets. He has a caravan worth $3,000, stock which he valued at $11,475, he has a block of land upon which the church is erected worth $6,000, various items of plant worth $9,500, a Toyota Landcruiser worth $23,000. He also has cash savings of $38,778, plus a half interest in a boat and trailer.

16   He is suffering from a few physical problems as a result of the hard work that he has had to carry out over the years. He has disk problems and this has resulted in lower back pain. He also gets pains in his elbows which is a consequence of the heavy work that he has done, particularly harvesting potatoes. He has difficulty with breathing and has had a sinus operation, and, although that has improved, he still has some problems which are probably caused by use of agricultural chemical sprays.

17   His income over recent years has not been large but in the year ended 30 June 1999 he had an income of $20,013 which substantially all was from primary production. There is in evidence his taxable incomes over the years since 1985, although these are not strictly an accurate description of his cash income. There is also evidence of his taxation returns which support the fact that the income that he has received since he has been working back on the farm is a marginal income, only sufficient to support himself. Obviously the deceased lived a very frugal existence. He spent nothing on himself, he lived in the old homestead in pretty terrible circumstances which the plaintiff would not share. This is probably why there has been some cash accumulated in his estate. Clearly the property is a borderline economic proposition.

18   It is necessary to have regard to the situation of others having a claim on the bounty of the deceased. In this case it is the three defendants who are the brothers of the deceased. So far as Norman Cashen is concerned, he has put on no evidence of his financial situation. Accordingly, the Court can assume that he does not wish his financial circumstances to be taken into account in the exercise the Court is carrying out. He has also put on no evidence of the relationship between himself and his brother over the whole of their lifetime. From some other evidence it is clear that Norman Cashen has the next door property and manages that and also looks after his wife. Probably it would be appropriate to infer that there is no evidence before the Court because it is his son making a claim and probably Mr Norman Cashen is standing to one side.

19   The next person to consider is Ernest Clive Cashen. He is 69 years of age, single with no dependents. He has never married. He has worked apparently in some labouring positions. In 1970 he suffered a lower back injury. He had a laminectomy and then had further surgery in 1980. He was on workers compensation for many years until he accepted a lump sum of $100,000 in 1985. He did not receive a pension until 1989, until which he then received and now receives the aged pension. He has some problems with his heart and he is on medication for blocked arteries.

20   His financial situation is that he has the aged pension of $203.90 a week which is consumed in his expenses. He has a property Acacia Lane, Kings Plain worth $60,000, and a block of land worth $25,000. He has a station wagon worth $4,000, some furniture, $9,600 in the bank. He has no liabilities. He lives in a transportable house on the two acre block which he inherited from his mother. This house was placed there in 1985, no doubt from his payout. There is a double garage and he also has 10 acres of land across the highway which has been used by the plaintiff, also the estate recently, for grazing stock. He has not received anything for this. Clearly he lives on a fairly tight existence and he has little assets behind him, merely $10,000.

21   There is evidence of assistance that he has provided to the deceased. He helped the deceased build a substantial car shed on the subject property in 1960. That would have taken some effort and, as I say, it is fairly substantial. He has a block of land which he has allowed the deceased and the plaintiff to use for potato farming and then grazing. He lived with his mother and the deceased at "Carinya" until she died in 1982 and he continued to live there with the deceased until 1985.

22   As I have mentioned he suffered a work injury in 1970. He apparently did no work on the property due to his injuries. He refers to the fact that during the period he lived with the deceased the deceased was actively involved in running the property and attended to all of the labour required in running the property. This is in marked contrast to the situation of the plaintiff, to which I will come in due course.

23   Lionel Clyde Cashen is married, he is 62 and has no dependents. He has had a series of labouring jobs in the country doing potato picking, fruit picking, and working in wool sheds. He worked as a shearer for many years until his back gave out when he was about 40. He also had a laminectomy. He made no compensation claim. He managed to get back to work and he, for many years, drove sugar trucks in Mackay in Queensland. He ruptured a disk again when he was clearing a paddock and had a further laminectomy. He had a claim which give him $15,000. Since 1995 he has been on the disability pension. His wife is also on the pension as she suffered from medical problems.

24   Their combined interest, pension and income amounts to $366 per week which is mainly consumed with their expenses. They have a house in Queensland worth $55,000, a Land Rover worth $22,000, a caravan worth $9,000, furniture and furnishings, about $24,500 in savings. They have no liabilities. They have to travel regularly to the Mater Hospital in South Brisbane for treatment, which is apparently about 40 kilometres from their home. They would like to buy a house closer to the hospital. There is no evidence as to what that cost might be. There is no evidence by Lionel Cashen of any contributions to the estate nor any evidence of the relationship that he had with his brother.

25   It is necessary to also look at the contributions that have been made by the plaintiff to the estate of the deceased. The first request for assistance came in 1985 as the deceased was suffering from high blood pressure and could no longer do the manual work. It is clear from the evidence that the plaintiff then started doing, on a part time basis for first couple of years, a substantial amount of work about the property. He put extensions on the hay shed and new skillion on the shearing shed He built new sheep yards and cattle yards. Though the deceased paid for the materials, the work was done by the plaintiff.

26   I have already recounted how plaintiff worked part time in 1986 and 1987 for no payment and came back in 1988 and lived full time at the request of the deceased. The plaintiff had earned a reasonable living doing his seasonable work and mining work because by 1985 he had saved about $40,000. The contributions to the estate included making the grazing operations a little bit more intensive and probably producing more income as a result. He also started, in 1989, the lucerne production which no doubt assisted in that regard. The plaintiff paid $2,000 of his own funds towards establishing the lucerne with fertiliser. I mentioned before that he purchased an irrigator for $8,000 and spray unit for $1800 which were used in the joint enterprise carried on by the plaintiff and the deceased. It is clear from the evidence that the plaintiff, from 1988 on, decided to stay, mainly because if he left the deceased would have to sell up. He accepted a lower income which resulted from him carrying on this work on the deceased’s farm. As I have indicated he has done all the work since basically 1988 although he has some recompense in terms of equipment and the church block.

27   The plaintiff in submissions submitted that he should have the whole of the estate to recognise the amount of work that had been done or, alternatively, 75 percent of the estate. The defendants for their part in submissions suggested that the plaintiff should have between a quarter and a third of the estate.

28   There are a number of the problems with the property and the estate. One is that there is only a small amount of cash left after payment of costs in this matter, and the other is that there is to be a relocation of the road which runs through the property. The existing highway will still stay but there is going to be a new highway through the block which will require some resumption and splitting of the block. At the present moment it looks as though it will be going through the lucerne paddocks. The block is at least big enough to be subdivided so that some money can be realised.

29   The other factor about it is that the farm is minimally economic. Probably the plaintiff could continue to make a living which would be sufficient for himself using it for grazing and still growing lucerne.

30   One has to of course balance the various claims. The first defendant has put on no evidence, as I have mentioned before. Clearly, therefore, the burden of any provision for the plaintiff should first fall on his share and thereafter fall on the shares of the other two brothers. Ernest Clive has allowed the use of his lands. He has also helped building a shed on the property. He is in a somewhat worse situation than his brother, but there is little other evidence of the relationship with his brother other than the fact that they lived together for some time.

31   So far as Lionel was concerned the evidence just simply discloses that he has made his own way separately in life, probably a large part of it in Queensland.

32   Since 1985 on a part time basis, and from 1988 on a full time basis, the plaintiff has done all the work on the property. The only income he has had has been from the sale of some stock that he ran. Accordingly, he has a very strong claim for a substantial part of the deceased's estate. The defendants are in poor circumstances and clearly they have no need for the land themselves. What they have a need for is some more cash. They are elderly and cash would assist in their managing the various matters that will crop up as a result of their ill health.

33   There are a number of different alternatives advanced by the defendants, but I do not think they in any way recognise the substantial contribution the plaintiff has made to the property. It was suggested there might be a portion of the property given to the plaintiff but there are all the difficulties about the uncertainty of the road resumption and what ultimately will happen to the block. I think the plaintiff ought to have the opportunity of having the property, but effectively the only way of arranging for this to be done is to give the plaintiff the whole of the estate subject to provisions in favour of the second and third defendant of pecuniary legacies to recognise their needs.

34   Section 14 of the Family Provisions Act is in the following terms:

"14(1) An order made by the Court for provision out of the estate of a deceased person - whether or not an order made in favour of an eligible person - shall, except insofar as the Court otherwise directs, take effect as if the provision had been made:
(a) where the deceased person died leaving a will - in a codicil to the will; or
(b) where the deceased person died intestate - in a will of the deceased person.

(2) The Court shall not direct that an order for provision out of the estate of a deceased person shall take effect otherwise than in the manner referred to in subsection (1) unless it is satisfied that compliance with the order will not adversely affect any creditor of the deceased person."

35   In this case there are no difficulties with creditors and accordingly the Court can fashion its order in any appropriate way to give the appropriate result. It is also important that in this case I take into account all the contributions and, for instance, the unpaid labour put into the property by the plaintiff. It is also important that I take into account the fact that the plaintiff himself has had the benefit of the property since the date of death and use of the stock, plant, and equipment. All these matters should be taken into account and thus included in the orders which I make.

36   Section 10 of the Family Provisions Act provides for consequential orders and is in the following terms:

"Where, on an application in relation to a deceased person, the Court makes an order for provision in favour of an eligible person out of the estate or notional estate of the deceased person, the Court may make an order in favour of any other eligible person or any other person by whom, or any purpose for which, property in the estate or notional estate of the deceased person is held or would, but for the order for provision in favour of the eligible person, be held that provision be made in such manner and to such extent as the Court thinks necessary to adjust all the interests concerned and to do justice in all the circumstances."

37   Accordingly, it seems to me that I should make a conditional order to take account of all the interests concerned and particularly the other claims. It is important that there should be a conclusion of all matters so that the parties can go their own separate ways. I think it is apparent from the way the parties have conducted themselves that they are on good terms but there is a problem which had to be dealt with by the Court to solve a family problem.

38   Accordingly, the orders I make are:-

Upon condition that the plaintiff releases the estate of the late Edward John Cashen and the defendants from any claims against them as executors of the estate, and the executors releasing any claims against the plaintiff for use of the estate assets since the date of death I order:-

(1) That the plaintiff receive the residue of the estate of the late Edward John Cashen after payment of
(a) a legacy of $45,000 to Ernest Clive Cashen
(b) a legacy of $40,000 to Lionel Clive Cashen
(2) The plaintiff’s costs on a party to party basis and the defendants on an indemnity basis to be paid or retained out of the residuary estate of the deceased.
(3) Interest on the legacy under the Wills Probate and Administration Act is to run from three months after today.

oOo

Last Modified: 07/04/2001