Drayton v Drayton - [2007] WASC 86

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: DRAYTON -v- DRAYTON [2007] WASC 86

CORAM: MASTER SANDERSON

HEARD: 2 APRIL 2007

DELIVERED : 4 APRIL 2007

FILE NO/S: CIV 1051 of 2007

MATTER :Section 26(6) of the Administration Act 1903 (WA)
and
Estate of DONALD LEE HUDSON, Late of 4 Sandalwood Court, Mount Tarcoola in the State of Western Australia, Purchasing Manager (Dec)

BETWEEN: HEATHER LYN DRAYTON
Plaintiff
AND
KATHRYN ANDREA DRAYTON
Defendant

Catchwords:

Probate - Application to be removed as surety - Application to remove defendant as administrator of the Estate - Turns on own facts

Legislation:

Nil

Result:

Plaintiff relieved as surety
Defendant removed as administrator of the Estate

Category: B

Representation:

Counsel:

Plaintiff: Mr D L Jones
Defendant: In person

Solicitors:

Plaintiff: Lewis Blyth & Hooper
Defendant: In person

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

Nil

MASTER SANDERSON: By originating summons dated 17 January 2007, the plaintiff sought to be relieved from any further liability under the surety that she has provided in respect of the administration of the Estate of the late Donald Lee Hudson. She also sought an order that the defendant be removed as the administrator of the Estate. At the hearing of the application, the plaintiff sought somewhat more extensive orders which I will detail below. However, it is first necessary to state the facts.
What follows is largely drawn from the affidavit of the plaintiff sworn 16 January 2007 and filed in support of this application. The defendant did not file an affidavit in reply. She did send a letter to the Court and insofar as that letter is uncontroversial, I have had reference to it. It remains the fact, however, that there is no sworn evidence from the defendant and where there is conflict, the evidence of the plaintiff must prevail.
The plaintiff is the mother of the defendant and the grandmother of Katelyn Rose Drayton ("Katelyn"). The deceased was the father of Katelyn. He died in a motor vehicle accident on 12 March 1998. Letters of administration were granted to the defendant on 5 November 2004.
The plaintiff says that in 2003 the defendant asked her to sign various documents confirming that the defendant was a fit and proper person to be appointed as guardian of Katelyn. The defendant advised the plaintiff that this was necessary so that funds held by the Public Trustee on Katelyn's behalf could be held by the defendant on Katelyn's behalf. The defendant also advised the plaintiff that she held other funds on trust for Katelyn. She said these funds were held with Macquarie Bank, and were the proceeds of the deceased's life insurance. The defendant advised the plaintiff that she wanted to combine the funds and that the Public Trustee required two guarantors to release the funds.
Katelyn's godfather, Mr Robert Edward Willsher ("Mr Willsher"), and the plaintiff signed various documents at the defendant's request and provided them to her solicitors. Among these documents was a sureties guarantee sworn on 9 February 2004. Prior to signing the relevant documents, the defendant advised the plaintiff that the money held by the Public Trustee would be placed in an account where Mr Willsher, the plaintiff and the defendant would be required to sign to remove any money. The funds were to be held for Katelyn's benefit until she turned 18.
In about February 2005, the defendant advised the plaintiff that the funds would soon be released from the Public Trustee. The plaintiff asked how the existing trust fund was going and the defendant advised that she did not know. The plaintiff then offered to assist the defendant in reviewing the financial documents. On or about 7 and 8 February, the plaintiff reviewed these documents and reached the view that of the approximately $75,000 originally deposited to the Macquarie bank account only $10,000 remained. When the plaintiff asked the defendant for an explanation, the defendant could offer none. She took the bank statements back from the plaintiff.
On 10 February 2005, the plaintiff received a facsimile transmission addressed to the defendant from the defendant's solicitors. The letter advised that the solicitors would be forwarding to the defendant a cheque, being for the Public Trustee funds, and requesting that the defendant sign an authority for this to occur. The plaintiff contacted the defendant's solicitors. She advised the solicitors that she was concerned that the money was being paid solely into the defendant's name. She said she was of the view that it should be put into a joint account held by the plaintiff, the defendant and Mr Willsher.
Soon after, the defendant attended the plaintiff's house asking for the fax so that she could sign it and return it to her solicitors. The plaintiff requested the funds be put in joint names. The defendant said this would be too difficult for her and that she was being pressed by her creditors. She also told the plaintiff that what became of the funds was none of the plaintiff's business. She took the letter and faxed it back to her solicitors authorising the Public Trustee funds to be paid to her. The defendant also advised the plaintiff that she did not care what the law said and that she (the defendant) was going to share Katelyn's money with Khiara, the defendant's other daughter, and not the daughter of the deceased.
On 11 February 2005, the plaintiff and Mr Willsher wrote to the defendant's solicitors alerting them as to their concerns. Soon after, the defendant attended at the plaintiff's house. While they were together they contacted the defendant's solicitor. The defendant told her solicitor she would accept nothing less than a cheque made out to her. Her solicitor advised that as Katelyn's guardian, the cheque would be sent to her in her name, but the cheque had to be deposited in a trust fund for Katelyn. The solicitor further advised that the principal sum plus interest must be available to Katelyn when she reached the age of 18 years. The solicitor further stated that to allow this to happen, Mr Willsher and the plaintiff would have to fax authorisation for the cheque to be sent to the defendant in her name. The defendant agreed that she would use the money as stated. On this basis, the plaintiff agreed to have the cheque forwarded to the defendant. The clear understanding was that the funds would be deposited in a trust account until Katelyn turned 18. The cheque was duly forwarded in the name of the defendant by her solicitors to the defendant.
The funds were not deposited in a joint trust account as agreed. The plaintiff tried to contact the defendant but without success. On or about 25 March 2005, the defendant moved house and the plaintiff had no contact with her until 19 February 2006. On 13 April 2006, the plaintiff's solicitors forwarded a letter to the defendant requesting that she account for the trust funds. A telephone conversation followed, during the course of which the plaintiff says that the defendant became heated. To date, nothing has been resolved.
What these facts disclose is a real apprehension of a breach of trust. In the circumstances, one might have expected a full and frank disclosure from the defendant as to what has become of the funds she was to hold for her daughter. No such explanation is provided in the correspondence. What the letter indicates is a degree of animosity between the parties which stands in the way of any resolution of their differences. Something must be done to rectify the position.
At the hearing, apart from the orders sought in the originating summons, the plaintiff sought to have the Public Trustee appointed as the administrator of the Estate. She also sought to have the defendant provide an account of her administration of the Estate to the Public Trustee and a further order restraining the defendant from dealing with the funds of the Estate. Clearly, all of the orders sought by the plaintiff are appropriate and, it appears, necessary.
Accordingly, the orders will be:
1.The plaintiff be relieved from any further liability under the guarantee that she provided in respect of the administration of the Estate of Donald Lee Hudson ("the Estate").
2.The defendant be removed as the administrator of the Estate forthwith.
3.The Public Trustee be appointed as the administrator of the Estate.
4.By 2 May 2007, the defendant provide an accounting of her administration of the Estate to the Public Trustee.
5.The defendant be restrained from dealing with funds of the Estate.
6.Liberty to apply.
The orders have not dealt with the question of costs. The outcome of the account may determine the way in which the costs are to be dealt with.