Clark v Leyshan

[2007] NSWSC 52

CITATION:	Clark v Leyshan [2007] NSWSC 52
HEARING DATE(S):	05/02/2007, 06/02/2007
JUDGMENT DATE :	6 February 2007
JURISDICTION:	Equity Division
JUDGMENT OF:	Associate Justice Macready at 1
EX TEMPORE JUDGMENT DATE:	6 February 2007
DECISION:	Paragraph 23
CATCHWORDS:	Family Provision. Application by son. Legacy ordered. No matter of principle.
PARTIES:	Brian Clark v Dorothy Leyshan
FILE NUMBER(S):	SC 1543 of 2005
COUNSEL:	Mr C Benson for plaintiff Mr L Ellision SC for defendant
SOLICITORS:	Colquhoun & Colquhoun for plaintiff Robert Mann for defendant

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THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

ASSOCIATE JUSTICE MACREADY

TUESDAY 6 FEBRUARY 2007

1543/05 BRIAN CLARK v DOROTHY LEYSHAN

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1 HIS HONOUR: This is an application under the Family Provision Act 1982 in respect of the estate of the late Doreen May Clark who died on 10 March 2004. She was survived by her three children, two of whom are parties to this application. The third child, Frank, has been given notice and makes no claim.

The last will of the deceased

2 The deceased made her last will on 20 November 2005. She appointed the defendant, her daughter, as the executrix and left her her house at 45 Riverleigh Avenue, Gerroa. The residue of the estate she left to the plaintiff, her son, Brian Clark. The deceased had previously made a will on 6 May 2002 in which she shared her estate equally between the two children.

Assets in the estate

3 At the date of death the deceased owned her property at 45 Riverleigh Avenue, Gerroa. That has an agreed value of $835,000. She also had approximately $1700 in cash in various bank accounts. There have been costs incurred in this case on the defendant's part of some $46,700. On the plaintiff's part they are $58,000 and those costs include both for the solicitor and counsel and uplift factor of some 25%. It would seem if any order is to be made in this case then the house will certainly have to be sold given the circumstances of the parties, which I will recount later. There is a reasonable prospect that even if no order is made that the house will still have to be sold.

4 The deceased married her husband, Sidney, in August 1935. The eldest son, Ronald, was born on 18 January 1936 and after he grew up he had little contact with his parents. For various reasons he makes no claim and no provision was made for him in recent wills of the deceased.

5 The defendant, Dorothy, was born on 4 July 1937 and Brian was born on 12 February 1945. It was in 1959 or 1960 that the deceased, her husband and the plaintiff himself moved to the property which is now held in the estate. In 1967 the plaintiff moved out when he married. He, from the 1990s, continued to help his parents in the maintenance of the property at Gerroa. The plaintiff moved to a nearby place at Kiama. In 1990 the plaintiff purchased a property at 13 Attunga Avenue, Kiama. This was purchased by him and his wife. It was just around the corner from their own home. The purpose of this purchase was to provide a home for their parents as they got older but the parents changed their minds immediately after having decided the house should be purchased and did not move there.

6 The defendant had lived for 30 to 40 years in the Mt Druitt area. She had previously been married but was separated and had a difficult marriage. She had to bring up her two children and lived in Housing Commission properties. In August or September 2001 she moved to Gerroa and lived in the property next door to her parents’ property. That was number 47. From this stage on she started looking after her parents carrying out laundry, washing for them and before long she had the deceased's husband living with her in number 47 because he was suffering from Alzheimers and needed far greater care than her mother was able to provide. The deceased's husband died in March 2002. In May of that year the deceased appointed the defendant as her attorney and made the will in which she left her estate equally between the children. It was in January 2003 that the deceased moved into number 47 and commenced to live with the defendant, or perhaps this move occurred in September 2003. Whenever it was, it was in November 2003 that the final will was made in which the plaintiff received an interest in residue and no share of the house. It seems fairly clear that the deceased was of the view that the defendant already had two houses and she wished to leave her house to her daughter.

7 On 13 January 2004 the deceased was hospitalised after a stroke and she moved into a nursing home in February 2004. She eventually died on 10 March 2004. Once she had the stroke, shortly thereafter she became incapable of speech, although she could communicate in a minor way with the defendant.

8 There were some assets which the deceased had consisting of a pension account and a joint account with the deceased's husband. She had given to the defendant the power to operate these accounts and over the period from the time when the deceased was hospitalised there were substantial withdrawals from these accounts by the defendant. There was approximately $26,300 withdrawn and substantially, according to the defendant, these amounts were used to meet expenses of which she gave details and also, in part perhaps, to do up the estate property. The defendant gave evidence of a conversation with the deceased who indicated that she was entitled to use the funds for that purpose and the withdrawals were made with the deceased's authority.

9 The plaintiff, in submissions, puts a far more sinister motive on it and has suggested the defendant simply took the money as she felt that she had been given a raw deal in life and that this was an opportunity to ensure that her brother did not obtain any amount. The question of whether or not those withdrawals were authorised might be of great interest in an administration suit. In the present case the matter is probably somewhat irrelevant because I think that the evidence discloses that a substantial amount of the monies were spent on meeting estate accounts and doing some repairs to the house. It is not, in my view, in this application, a matter of substantial significance.

Eligibility

10 The plaintiff is an eligible person and plainly is entitled to make the application. In applications under the Family Provision Act the High Court in Singer v Berghouse (1984) 181 CLR 201 has set out the two stage approach that a Court must take. At page 209 it said the following:-

“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 exists between ‘adequate provision’ and ‘proper maintenance’ etc were explained in Bosch v Perpetual Trustee Co Limited . 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 etc 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 we no assets from which an order could reasonably be made and making an order could disturb the testator’s arrangements to pay creditors”.

The plaintiff's situation in life

11 I turn to consider plaintiff’s situation in life. The plaintiff is married. He is presently aged almost 62 years. He has three children. They are no longer dependent upon him. The situation is that he and his wife own their family home at 58 Attunga Avenue, Kiama worth $457,500 at present value. He also has the home which was purchased by him initially to provide for his parents in their old age. That is now worth $425,000. Neither of these homes are encumbered. The purchase of 13 Attunga Avenue, Kiama was made in 1992 and the property has been maintained and let over the years. He has a number of motor vehicles and a Harley-Davidson motorbike. The vehicles are an old 1985 model tarago van worth $500, the family Mazda sedan worth $2500, a Harley-Davidson worth $7,600 and a Ford GT worth $10,000. He and his wife also have a camper van which he says is worth less than $55,000, which they have used from time to time to travel around Australia. He has a boat worth $1800. He has cash and shares of some $7,000 and minimum superannuation of $20,000.

12 The plaintiff's income situation is not good. He runs a business in which he manufactures blinds and screens from home and he has done that for many years. His income for the year ended 30 June 2005 was $6,636 and that included the income from the house at 13 Attunga Avenue, Kiama. His wife, who looks after the administrative arrangements for the business, had an income of $6,545. In the year ended 30 June 2006 their respective incomes were $5,912 and $5,684. This is a fairly minimal income and it is to be appreciated that the plaintiff is now 62 years of age. There was some criticism of his level of energy perhaps in business, but that is a matter which I do not think is of great substance. His expenses for his home are $368 per week and the expenses for the rental property are $57 80 per week. The plaintiff, until recent years, had a good relationship with the deceased. Over the last 14 years he said that he had done a lot of gardening and maintenance on his parents’ property. He used to mow the lawn and his wife would also assist each fortnight over the period from about 1996 until September 2003 when his parents needed the help. There was then, of course, the proposal for the purchase of the property at 13 Attunga Avenue, Kiama which ultimately did not provide a house for the parents to live near him so they could give more attention but, plainly, he had his parents' interests at heart.

13 The deceased herself needed more help because obviously her husband had substantial difficulties. He was partially blind, suffering from dementia and heart problems and both, not only the plaintiff but also the defendant at a later time, spent a lot of time looking after the parents. There was also provision in this period of preparing meals and getting meals-on-wheels and taking them to the deceased and the husband.

14 Plainly, the deceased trusted the plaintiff. He was the signatory on his mother's account but that all changed in 2002 when the defendant came to live and look after the deceased and also her husband. It seems that this change interfered in some way, probably not intentionally, on the part of the defendant in the arrangements which the plaintiff had with the deceased. It is very difficult in circumstances such as the present to say whether or not there was something sinister about it. I think not. I think what happened was that the defendant was in a position where she could move to look after her parents and did so and things continued on from there.

15 There is also, of course, the question of any benefits which might have been provided to the plaintiff during his lifetime. There was a loan of $5,000 which was made available to help the plaintiff to build a camper van. I am satisfied that this was made available but it was repaid by him within a few years thereafter. There is also in respect of the purchase of 13 Attunga Avenue, Kiama provision of some funds via way of deposit.

16 There are two amounts of $16,100 and $4,200 which were paid by the deceased. The property was eventually purchased by the plaintiff and his wife and they paid the balance of the purchase money and paid it off over the years mainly by their hard work and effort. There is a copy of a note in a diary of the deceased in which there is a note said to be in the deceased's handwriting that these amounts were not repaid. The plaintiff himself was very uncertain about it but seemed to acknowledge that those amounts were paid. Though he said he paid them back, he gave no evidence of when that happened or how that occurred. There is certainly no documentary evidence. The only documentary evidence appears to be the note in the front of the diary. Although that was suggested to be the defendant's handwriting, I would not think, having compared that with her signature, that I could safely come to that conclusion, that being the only evidence. I am satisfied that there was that provision of assistance of some $20,300 originally to the plaintiff.

17 I returned to the defendant's situation in life. The defendant is single. She is aged 69. I say she is single but acknowledge that there is in this case at least a substantial submission that, in fact, she is living in a de facto relationship with a gentleman, Mr Waddell. The defendant’s evidence is clear that, although he moved into and lived in the estate property after the death of the deceased, they are not de facto partners: he has a room, they eat their meals separately. According to the defendant they do not have a sexual relationship and on her version lead somewhat separate lives. It seems to me it is significant he has given no evidence in the case. However, it is also significant that there is no other evidence which has been called to suggest that there is something more to their relationship than simply that of a lodger or boarder, which is what the defendant says. In the circumstances, having regard to the defendant's evidence, I am prepared to accept her evidence that, in fact, he is not a de facto partner of hers.

18 The plaintiff has problems with high cholesterol, hypertension and depression and has the possibility of having diabetes. She receives an aged pension of $517 90 per fortnight and has a 1981 car that needs work. She has minimal cash and some old furnishings. The situation no doubt arises from the somewhat difficult life that she had. She lived in Sydney for some 30 to 40 years and had little opportunity to see the deceased who was down the south coast. She did give evidence ultimately in cross-examination that she had, in fact, travelled to see them and had not been out of communication with the deceased over that period and I accept that evidence. It seems to me that what happened was that the defendant simply was too caught up in the problems of raising her own family after she was left alone living in Housing Commission properties and having little means of being able to see her parents. However, certainly she did attend to her parents' needs in the recent years before the deceased finally died.

19 She has had the benefit of some small part of the funds that were in the deceased's account. I do accept her statement that her son did provide funds for some of the work done on the house, so there has been a contribution in a sense by her and her son to fixing up the estate property.

20 It is necessary to see how the plaintiff says that he has been left without adequate and proper provision for his maintenance, education and advancement in life. The plaintiff advances two matters really as going to proper provision. The first is that he has little cash reserves and that both the house at 13 Attunga Avenue and 58 Attunga Avenue, Kiama need repairs. There is independent evidence which was not contested that necessary repairs to 13 Attunga Avenue, Kiama would amount to $20,727 and the necessary repairs to 58 Attunga Avenue, Kiama would amount to $16,216. The costs of these cannot be met without borrowings and, given the very limited amount of income which the plaintiff has, his chances of borrowing I would have thought are fairly negligible. He also says that because of his situation he needs some buffer and suggests a legacy in the sum of $75,000-$100,000 would be appropriate. The plaintiff has the benefit of some large capitol assets but he also has very little by way of superannuation. He has some $20,000 which will not assist him. He also is in a difficult situation where, having a house, he will, if he sells the property at 13 Attunga Avenue, Kiama, have little access or reduced access to the pension. He wishes to continue to retain the house and to receive its income. He is not particularly intent on selling it, having regard to the costs.

21 The situation here is that the matter has started and come through to the point now where very substantial costs have been incurred. Probably in any event, as I have said, the house will have to be sold. In those circumstances it seems to me that the plaintiff has been left without adequate provision. He has minimal cash reserves and has necessary repairs to do and is living on very reduced income in somewhat reduced circumstances. Certainly his situation is not going to get any better and there is probably little chance for him to change.

22 I appreciate that the defendant is living in the property. It is a large property. She only has to provide for herself and there will be a substantial cash available to her if it is sold. In the circumstances I think it is appropriate that there be some provision for the plaintiff.

23 Accordingly, the orders that I make are:

(1) The plaintiff receive a legacy in the sum of $50,000.
(2) That the plaintiff's costs excluding any up-lift factor be paid out of the estate of the deceased on the ordinary basis.
(3) That the defendant's costs be retained or paid out of the proceeds of the estate on an indemnity basis.
(4) I order that interest shall run on the legacy if not paid within three months on and from three months from today's date at the rate provided for under the Wills Probate and Administration Act 1898.
(5) The exhibits can be returned.

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