Domanti v Domanti

Case [2020] QSC 360

SUPREME COURT OF QUEENSLAND

CITATION:  Domanti & Anor v Domanti [2020] QSC 360
PARTIES:  ANDREW ALAN DON DOMANTI
(first applicant)
and
SANTINO ANTONY ANDREW DOMANTI
(second applicant)
v
ANNETTE THERESE JOCELYN DOMANTI (AS
EXECUTOR OF THE ESTATE OF THE LATE
DOMENICO DOMANTI DECEASED)
(respondent)
FILE NO:  SC No 440 of 2019
DIVISION:  Trial division
PROCEEDING:  Originating application
ORIGINATING  Supreme Court of Queensland at Brisbane
COURT: 
DELIVERED ON:  4 December 2020
DELIVERED AT:  Brisbane
HEARING  2 and 3 November 2020
DATES: 
JUDGE:  Ryan J

ORDERS: 

1.

The applications of the first and second applicants are dismissed.

2.

The parties are directed to attempt to agree upon an order for costs. If they cannot reach agreement, costs will be decided on the basis of written submissions to be provided in accordance with a timetable to be agreed between the parties and the Court (via my associate).

CATCHWORDS: 

SUCCESSION – FAMILY PROVISION – REQUIREMENT FOR ADEQUATE AND PROPER MAINTENANCE – where the deceased was a cane farmer – where under his will, the

deceased left the cane farm (made up of four properties) to the first applicant and made other dispositions of property to his

children subject to certain “equalisation clauses”  where the
first applicant submits that adequate provision was not made
for him – where the first applicant seeks an outcome which
would allow him to inherit the farm properties upon his
payment to the estate of $520,000 – where the second applicant
only presses his application in the event that the first applicant
is successful  whether the first applicant has satisfied the

jurisdictional threshold, namely, that the deceased left the first applicant without adequate provision for his proper maintenance and support

Succession Act 1981 (Qld), s 41(1), s 41(8)
Blair v Blair [2002] VSC 95, considered
Collet & Anor v Knox & Anor [2010] QSC 132, cited
Frizelle v Old [2009] NSWSC 1259, considered
Fellows v Paterson [2002] NSWSC 190, considered
Hughes v National Trustees, Executors & Agency Company
of Australasia Limited (1979) 143 CLR 134, considered
Niebour-Pott & Anor v Pott [2020] QSC 7, considered
Re Flavel: Flavel v Flavel [2020] VSC 19, considered
Richards v Augustine & Anor [2012] QSC 46, considered
Roberts v Roberts (1992) 9 WAR 549, considered
Slack v Rogan (2013) 85 NSWLR 253, considered
COUNSEL:  C A Brewer with P Coore for the first applicant
R T Whiteford for the second applicant
R M Treston QC with K J Kluss for the respondent
SOLICITORS:  Wilson, Ryan and Grose Lawyers for the first applicant
Mullins Lawyers for the second applicant
De Groots for the respondent

Overview

  1. The deceased, Domenico Domanti, was a cane farmer in Ayr. He died on 30 August 2017. His wife predeceased him by many years. He is survived by his three adult children Andrew, Santino (or Tino) and Annette.[1] His last will, dated 10 March 2017, revealed his intention that his children would benefit equally under it. Andrew claims that…

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AGLC
Domanti v Domanti [2020] QSC 360
Case
[2020] QSC 360
Decision Date

CaseChat Overview and Summary

In Domanti v Domanti, the dispute centred around the estate of a deceased cane farmer. The son, Andrew Domanti, sought an order under the Family Provision Act that he inherit the farm outright, as opposed to the will’s provision that he inherit the farm but also repay a $520,000 debt to the estate. The other beneficiaries were the deceased’s wife, Annette, and their other son, Tino. The legal issues before the court involved whether the deceased had made adequate provision for Andrew, and if not, what provision a wise and just father would have thought it his moral duty to make in Andrew’s interest. The court found that the deceased had made adequate provision for Andrew, and thus did not make any orders in his favour.

The court’s reasoning was grounded in the principles of testamentary freedom and the need to respect the wishes of a capable testator. The court emphasised that a court should not intervene merely because it thinks it would have been better for the testator to benefit the applicant in a certain way. The court must consider the applicant’s need for maintenance, education, and advancement in life, but this need must be assessed in light of all the circumstances. The court found that the deceased had duly considered Andrew’s needs and had made adequate provision for him by bequeathing the farm to him subject to the repayment of the debt. This provision took into account Andrew’s contributions to the farm and the financial circumstances of the estate. The court also noted that Andrew had not presented evidence that would allow the court to properly consider an alternative to his assertion that he ought to be permitted to inherit the farm without repaying the debt.

The court’s decision was based on a detailed consideration of the evidence presented by the parties, including evidence of the financial and personal circumstances of Andrew, Tino, and Annette, as well as evidence from the estate’s administrator and an accountant called by Andrew. The court found that the deceased had made adequate provision for Andrew, and thus did not make any orders in his favour. The court emphasised that it was not the role of the court to achieve an overall fair disposition of the deceased’s estate or to address the sense of wrong felt by an applicant. Instead, the court’s role was to ensure that the provisions of the Family Provision Act were given full operation, even though they encroached on testamentary freedom.

Orders

Orders of the court

1.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

The second stage only arises if I am of the view that the deceased did not make adequate provision for Andrew in his will. If I were to reach that stage, I would need to consider the provision which a wise and just father would have thought it his moral duty to make in Andrew’s interest had he been fully aware of all the relevant circumstances. Evidence In these matters, the onus is on the applicant. Thus, it was for Andrew to satisfy me that the deceased did not make adequate provision for him in his will, having regard to Andrew’s needs. The other beneficiaries, Tino and Annette, did not have to justify their receipt of benefits under the will. The evidence tendered included evidence about the financial and personal circumstances of Andrew, Tino and Annette; evidence from the administrator of the estate; and evidence from an accountant called by Andrew (Mr Smith) to prove that he would be able to raise $520,000 on the security of the farm. There was no objection to any of the evidence tendered, even though much of it was hearsay or argumentative or evidence of impressions. In the case of the evidence tendered by Andrew, I note that the estate took the view that to seek rulings from me about the admissibility of parts of it would add to the costs of these already very expensive proceedings. Evidence of the estate’s administrator Mr Whitla’s administrator’s report, dated 27 October 2020, was in evidence. Its primary purpose was to outline, for the benefit of the parties, the steps taken or to be taken by the administrator pending the resolution of this matter. Additionally, it provided an overview of the current financial state of the estate, which was relevant to arguments made by the estate and Tino that it is no longer possible to achieve Andrew’s goal (of inheriting the farm) because of the need to sell estate assets to meet estate debts. In addition to the accounts and other financial documents attached to it, the report reveals the following – In oral evidence, Mr Whitla explained that there would be a significant cash flow shortage in the new year, with the last of the crop proceeds due in December 2020. He would need thereafter to “find” income which could include the income from the commercial properties. If he were to sell all of the estate’s assets, other than the farm, then the NAB’s debt would likely be discharged. Through Mr Whitla, counsel for Tino established that, even if Andrew had “worked for free” and not taken “a cent” in drawings,[9] the farm would have lost $74,904 since the date [9] The evidence was to the effect that Andrew was compensated for his work on the farm in part by “drawings” of the deceased’s death. It was acknowledged that the interest which had been applied to the farm in 2018, 2019 and 2020 ($84,036 in total) contributed to some of that $74,904 loss. However, even on a calculation which – The order sought by Andrew involves “quarantining” the farm and using the proceeds of sale of the other properties, plus the $520,000 from Andrew, to repay the NAB. Mr Whitla’s understanding was that, before the NAB would agree to such a proposal, it would need to be satisfied that the other properties would achieve sale prices which would (when added to the $520,000) be sufficient to discharge the loan, because “otherwise they [the NAB] are releasing the security over the farm and they’re whistling in the wind for the balance”. The NAB’s preferred position was that either everything, or nothing, was to be sold.

Decision

Reasons for decision

I pause here to consider that paragraph from Slack v Rogan in full context. The applicant in that case was the deceased’s foster child, who had been left nothing in her will and whose financial position was precarious. In deciding that it was appropriate to order further provision in favour of the applicant in an amount which would “discharge his debts and provide a buffer for his contingencies”, White J said (my emphasis) - [126] The question of whether the provision, if any, made for an eligible applicant is adequate for his or her proper maintenance, education or advancement in life is to be assessed having regard to the facts and circumstances of each individual case. The assessment involves a broad evaluative judgment which is not to be constrained by preconceptions and predispositions: Bladwell v Davis. This really means that there are no definite criteria for the exercise of the “evaluative judgment”. [127] In my view, respect should be given to a capable testator’s judgment as to who should benefit from the estate if it can be seen that the testator has duly considered the claims on the estate. That is not to deny that s 59 of the Succession Act [NSW] interferes with the freedom of testamentary disposition. Plainly it does, and courts have a duty to interfere with the will if the provision made for an eligible applicant is less than adequate for his or her proper maintenance and advancement in life. But it must be acknowledged that the evidence that can be presented after the testator’s death is necessarily inadequate. Typically, as in this case, there can be no or only limited contradiction of the applicant’s evidence as to his or her relationship and dealings with the deceased. The deceased will have been in a better position to determine what provision for a claimant’s maintenance and advancement in life is proper than will be a court called on to determine that question months or years after the deceased’s death when the person best able to give evidence on that question is no longer alive. Accordingly, if the deceased was capable of giving due consideration to that question and did so, In Slack v Rogan, White J found that the deceased’s cognition was impaired at the time Returning to the estate’s submissions, it referred to Andrew’s unwillingness to entertain The estate also submitted that whilst the deceased clearly intended Andrew to receive the farm, he also clearly intended each of his children to receive an equal distribution from the estate. That that was his long held intention may be inferred from the terms of his previous will and his equal treatment of his children in the past. The deceased’s previous will was dated 10 November 1999. It bequeathed the farm to Andrew and the other property to Annette and Tino but contained an “equalisation clause” in the following terms - I FURTHER DIRECT that notwithstanding the preceding provisions of this my Will I DIRECT that my trustees shall as soon as practicable after my death cause a valuation to be made of all my assets comprising my estate and to ascertain as near as practicable the value of the individual devises and bequests made to each of my children as aforesaid at the date of my death and as ascertained by such valuation then the child or children receiving the greater value of my estate shall pay to the other or others of them such amount as such be required so that each of my said children shall receive an equal payment or value of my estate at the time of my death. Any such inequality in value shall be paid by such child or children to the other or others of them within twelve months from the date of my death and the amount so owing shall constitute a charge on any real estate devised and bequeathed by me to the child owing such money to the other or others of them. I FURTHER DIRECT that in calculating the value of my estate and the value thereof devised and bequeathed to each of my said children the amount of debt owing by me shall be deducted from the gross value of such estate and be shared equally by my said children.

Ratio Decidendi

Legal Principle Established

The estate observed that Andrew had been fairly remunerated for his work on the farm and that Annette and Tino had personally guaranteed loans to the value of $1.5 million over the years, to ensure the continuation of the farm. But for those guarantees, the farm or at least parts of it would likely have been sold years ago. Consideration Andrew’s approach to this application was rigid. Rather than identify his needs both in monetary (in terms of, for example, income needs or a provision for contingencies or the cost burden of his dependents) and non-monetary (such as, for example, the need for a house and an occupation) terms, his position was, in effect, that nothing less than his proposal would be adequate. Even if I thought that there was room to contemplate some increase in the provision for Andrew (and I am not saying here that I reached that conclusion), he did not produce evidence which would allow me to properly consider an alternative to his assertion that he ought to be permitted to inherit the farm upon the payment of $520,000 to the estate. Adequate provision? I remind myself of the principles which must guide my approach in this matter, which I summarised in Niebour-Pott. They include that a court is not to intervene merely because it thinks it would have been good, fair or more equal for the testator to have benefitted the applicant in a certain way. The consideration of whether adequate provision has been made for an applicant must show due regard for freedom of testamentary disposition. A person has a right to dispose of their property by will as they see fit and a court will only interfere if a testator has abused that right. Considerable weight must be given to the testamentary wishes of a capable testator. At the first stage of the inquiry, a court must consider an applicant’s “need” for maintenance, education and advancement in life. “Need” is a relative and an elusive concept. The question of need must not be too narrowly focused. It must consider matters such as present and future needs, including the need to guard against unforeseen contingencies. “Need” is a flexible word which means more than “want” but falls far short of “cannot survive without”. “Need” is to be assessed in light of all of the circumstances. It is not a case of looking in isolation at the value of the assets which the applicant has and deciding whether the person has enough to get by on, comfortably or otherwise. The applicant’s assets and income The legislation does not authorise a redistribution of the estate according to indeterminate and unreliable concepts such as fairness or equality. The court is not to endeavour to achieve an overall fair disposition of the deceased’s estate or some kind of equity between the claimants. The court’s role is not to address the sense of wrong felt by an applicant. Having said that, the statute is to be given full operation, according to its terms, even though it encroaches on testamentary freedom.