Dudic v Jakovljevic
[2014] NSWSC 169
•05 March 2014
Supreme Court
New South Wales
Medium Neutral Citation: Dudic v Jakovljevic [2014] NSWSC 169 Hearing dates: 18 February 2014 Decision date: 05 March 2014 Jurisdiction: Equity Division Before: Hallen J Decision: Direct the parties, within 14 days, to provide Short Minutes of Order, reflecting these reasons. Stand the matter over for 21 days.
Catchwords: SUCCESSION - FAMILY PROVISION - The Plaintiff, a daughter of the deceased, applies for a family provision order under Chapter 3 of the Succession Act 2006 - The Defendant is the widow of the deceased - Deceased left no Will - No provision for the Plaintiff under the rules of intestacy - Very small estate - Whether adequate and proper provision not made for the Plaintiff and, if so, the nature and quantum of the provision to be made - Order for lump sum Legislation Cited: Family Provision Act 1982 (NSW)
Practice Note SC Eq 7
Probate and Administration Act 1898 (NSW)
Property (Relationships) Act 1984 (NSW)
Succession Amendment (Family Provision) Act 2008 (NSW)
Succession Act 2006 (NSW)
Uniform Succession Laws: Intestacy [2007] NSWLRC 116Cases Cited: Alexander v Jansson [2010] NSWCA 176
Allardice, In re; Allardice v Allardice (1910) 29 NZLR 959
Allen (Dec'd), In re; Allen v Manchester [1922] NZLR 218
Andrew v Andrew [2012] NSWCA 308; (2012) 81 NSWLR 656
Aubrey v Kain [2014] NSWSC 15
Bartlett v Coomber [2008] NSWCA 100
Bondelmonte v Blanckensee [1989] WAR 305
Bosch v Perpetual Trustee Co Ltd [1938] AC 463
Bridges, Re Estate of (1975) 12 SASR 1
Buckland Deceased, Re [1966] VR 404
Bull, Re [2006] VSC 113
Butcher v Craig [2009] WASC 164
Cameron v Cameron [2009] SASC 27
Christie v Manera [2006] WASC 287
Collins v McGain [2003] NSWCA 190
Re Coventry (deceased) [1979] 3 All ER 815
Crossman v Riedel [2004] ACTSC 127
de Angelis v de Angelis [2003] VSC 432
Delacour v Waddington (1953) 89 CLR 117
Devereaux-Warnes v Hall (No 3) [2007] WASCA 235; (2007) 35 WAR 127
Diver v Neal [2009] NSWCA 54
Edgar v Public Trustee for the Northern Territory [2011] NTSC 05
Flathaug v Weaver [2003] NZFLR 730
Foley v Ellis [2008] NSWSC 288
Gardiner v Gardiner (Supreme Court (NSW), Santow J, 28 May 1998, unrep)
Golosky v Golosky [1993] NSWCA 111
Goodman v Windeyer [1980] HCA 31; (1980) 144 CLR 490; (1980) 31 ALR 23; (1980) 54 ALJR 470
Gorton v Parks (1989) 17 NSWLR 1
Grey v Harrison [1997] 2 VR 359
Hampson v Hampson [2010] NSWCA 359
Hawkins v Prestage (1989) 1 WAR 37
Heyward v Fisher (New South Wales Court of Appeal, 26 April 1985, unreported)
Hughes v National Trustees, Executors and Agency Co of Australasia Ltd [1979] HCA 2; (1979) 143 CLR 134; (1979) 23 ALR 321; (1979) 53 ALJR 249
Hyland v Burbidge [2000] NSWSC 12
Kay v Archbold [2008] NSWSC 254
Kleinig v Neal (No 2) [1981] 2 NSWLR 532
Kossert v Margaret Gerda Ruggi As Executor of the Will of Peter Korps [No 2] [2012] WASC 191
Luciano v Rosenblum (1985) 2 NSWLR 65
MacGregor v MacGregor [2003] WASC 169
Magill v Magill [2006] HCA 51; (2006) 226 CLR 551; (2006) 231 ALR 277; (2006) 81 ALJR 254
Manuel v Lane [2013] NSWCA 61
Marks v Marks [2003] WASCA 297
Marshall v Carruthers; Marshall v Marshall [2002] NSWCA 47
Mayfield v Lloyd-Williams [2004] NSWSC 419
McCosker v McCosker [1957] HCA 82; (1957) 97 CLR 566; (1957) 31 ALJR 779
McGrath v Eves [2005] NSWSC 1006
McKenzie v Topp [2004] VSC 90
Morris v Smoel [2014] VSC 32
Nicholls v Hall [2007] NSWCA 356
O'Loughlin v O'Loughlin [2003] NSWCA 99
Palaganio v Mankarios [2011] NSWSC 61
Phillips v James [2014] NSWCA 4
Pontifical Society for the Propagation of the Faith v Scales [1962] HCA 19; (1962) 107 CLR 9; (1962) ALR 775; (1962) 36 ALJR 1
Puckridge, Deceased, In the Estate of (1978) 20 SASR 72
Singer v Berghouse (No 2) [1994] HCA 40; (1994) 181 CLR 201; (1994) 123 ALR 481; (1994) 68 ALJR 653
Slack v Rogan; Palffy v Rogan [2013] NSWSC 522
Stern v Sekers; Sekers v Sekers [2010] NSWSC 59
Stiles v Joseph (Supreme Court (NSW), Macready M, 16 December 1996, unrep)
Szypica v O'Beirne [2013] NSWSC 297
Taylor v Farrugia [2009] NSWSC 801
Tobin v Ezekiel [2012] NSWCA 285; (2012) 83 NSWLR 757
Verzar v Verzar [2012] NSWSC 1380
Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191; (2005) 213 ALR 692; (2005) 79 ALJR 731
Walker v Walker (Supreme Court (NSW), Young J, 17 May 1996, unrep)
Webb v Ryan [2012] VSC 377
West v Mann [2013] NSWSC 1852
Wilcox v Wilcox [2012] NSWSC 1138
Williams v Aucutt [2000] 2 NZLR 479Texts Cited: J D Heydon and M J Leeming, Jacobs' Law of Trusts in Australia (7th ed, 2006, LexisNexis Butterworths) Category: Principal judgment Parties: Rebecca Dudic (Plaintiff)
Mica Jakovljevic (Defendant)Representation: Counsel:
Mr M K Rollinson (Plaintiff)
Mr M Bradford (Defendant)
Solicitors:
Justice Lawyers (Plaintiff)
John Woulfe Solicitors (Defendant)
File Number(s): 2013/150634
Judgment
The Claim
HIS HONOUR: These reasons relate to proceedings in which a family provision order pursuant to the Succession Act2006 (NSW) ("the Act") is sought by the Plaintiff, Rebecca Dudic, out of the estate of her biological father, Rade Jakovljevic ("the deceased"). A family provision order is an order made by the Court in relation to the estate, or notional estate, of a deceased person, to provide from that estate and/or notional estate, for the maintenance, education, or advancement in life, of an eligible person.
The proceedings were commenced by Summons filed on 15 May 2013, within the time prescribed by the Act (within 12 months of the deceased's death).
The deceased died intestate, no will, or other testamentary instrument, having been located. The Defendant named in the proceedings is the deceased's widow, Mica Jakovljevic, who is the sole administrator of the estate.
The matter proceeded with the reading of the evidence filed in the proceedings. Mercifully, there were only a few objections to parts of the affidavits which needed to be ruled upon. The cross-examination of each of the parties and a family member in each party's case (the mother of the Plaintiff and the daughter of the Defendant) then occurred. Finally, counsel made oral submissions in support of the written submissions which are retained in the court file. The estimated duration of the hearing was one half day. The proceedings were not concluded within that time but within one day.
Without intending to convey undue familiarity, with no disrespect intended, and for convenience, I shall refer, hereafter, to the parties, family members, and witnesses, after introduction, by his, or her, given name.
Formal Matters
The following facts are uncontroversial.
The deceased died on 17 May 2012. He was then aged 73 years, having been born, in Serbia, in August 1938. He migrated to Australia in about 1963. Thereafter, he appears to have worked as an opal miner in Lightning Ridge, a town in northwest New South Wales, about 60 kilometres from the Queensland border.
Rebecca's mother, Ljubica Dudic and her husband, Dimitrije, were married in about 1964. They met the deceased, in Lightning Ridge in about 1973. They had not known the deceased before then, although Ljubica, apparently, came from a town in Serbia close to where the deceased had lived. They became friends as Ljubica and Dimitrije visited Lightning Ridge, usually on holidays, at Easter and at Christmas.
Rebecca was born in 1975. There is no dispute that she is the daughter of the deceased. There were two children of Ljubica's marriage and Rebecca was raised as one of the children of the marriage. Dimitrije died in June 2000. It is said that he had known, since the birth of Rebecca, that he was not her biological father (a matter to which I shall return).
Rebecca's paternity was confirmed by DNA parentage testing which was conducted, with the co-operation of the deceased, in February 2012. I shall return to events that led to, and that followed, the DNA testing later in these reasons.
Mica was born in March 1950 and is now aged almost 64 years. She met the deceased in 1992, upon her arrival in Australia on a tourist visa. They commenced to live together in about 1993 and were married to each other in December 1997. They remained married until his death about 14.5 years later. (The relationship of Mica and the deceased, therefore, was about 19 years.) There were no children of their marriage. It was the first marriage of the deceased and the second marriage of Mica.
Mica had two children from her prior marriage, each of whom is now an adult. Her daughter, Sonja, gave evidence in the proceedings.
This court granted Letters of Administration on intestacy, in relation to the deceased's estate, to Mica, on 3 January 2013.
The Inventory of Property disclosed to the court under s 81A of the Probate and Administration Act 1898 (NSW), a copy of which Inventory was attached to the Letters of Administration, stated that the property owned solely by the deceased at the date of his death had an estimated (or known) gross value of $205,000. No liabilities were disclosed. The deceased's estate was said to consist only of real estate in Lightning Ridge, New South Wales.
Mica's evidence, by affidavit, is that, at the date of his death, the deceased also owned a Toyota Land Cruiser ($500) and held money in a bank account ($729). She says that these assets were omitted from the Inventory of Property as she did not think she had to disclose them because of their small value. Rebecca made no complaint about this omission and the items have been ignored otherwise.
The funeral expenses of the deceased, which Mica has paid, totalled over $16,000, which amount included the costs of a monument and funeral director's expenses. In addition, Mica paid $1,200 for an orthodox priest to be flown from Melbourne, as there was no orthodox priest in the Lightning Ridge area. Mica also paid the expenses for the funeral function and the cost of the traditional functions for mourning after forty days, six months, and one year of the deceased's death. (No evidence of the costs of these functions is stated in the evidence.)
The testamentary legal fees, costs and disbursements in relation to obtaining Letters of Administration, and other legal costs, such as the costs of transmitting the Lightning Ridge property to her, total $9,333, which amount Mica also paid.
The deceased purchased the Lightning Ridge property in the late 1970s. He built a house on that property in about 1980. It was to that house that Mica moved at the time of her marriage to the deceased and in which the parties lived for part of their marriage.
The parties agreed that the value of the Lightning Ridge property, at the date of the hearing, was $215,000. They also agreed that if it were to be sold, the costs and expenses of sale would be $7,000.
Section 113 of the Act deals with a spouse's entitlement on intestacy and is relevant where there is a spouse and any issue who are not issue of the spouse and the intestate. Pursuant to that section, Mica became entitled to the deceased's personal effects, a statutory legacy (as defined in s 106 of the Act) (more than $350,000), and one-half of the remainder (if any) of the deceased's estate. Accordingly, Mica is entitled to the whole of the deceased's estate. By the operation of the intestacy rules, no part of the deceased's estate passes to Rebecca.
By Transmission Application, registered at the NSW Land and Property Information Office in April 2013, the deceased's interest in the Lightning Ridge property was transmitted to Mica absolutely and beneficially.
Since there is no dispute that the whole of the actual estate was distributed to Mica, beneficially, there is no actual estate available at the date of the hearing. A question is whether, as a result of the distribution made, there is property that may be designated as notional estate and, if so, whether a designating order should be made. However, this question does not need to be dealt with in these reasons as the parties agreed, at the commencement of the hearing, that, in the event that a family provision order by way of lump sum were made for Rebecca, Mica would satisfy the order by paying the lump sum. The parties requested that the only relevant order to be made was one, pursuant to s 66 of the Act, granting liberty to any party to apply, in these proceedings, for consequential and ancillary orders for the purpose of, or with respect to, giving effect to, and implementing, any family provision order made in favour of Rebecca. I indicated that I would be prepared to make that order.
At the date of the hearing, Mica does not wish to sell the Lightning Ridge property because she uses it as a "holiday house" when she returns to Lightning Ridge. She says that, if provision is made for Rebecca, she will, with the assistance of family members, try to satisfy the order for provision without selling the Lightning Ridge property.
Prior to the deceased's death, and currently, Mica's son-in-law, Sonia's husband, has been living there, rent, and occupation fee, free. However, he is to vacate the property in the next week or so, at which time, Mica believes that she will rent it to earn an income.
In calculating the value of the estate, actual and notional, finally available, the costs of the present proceedings should also be considered, since Rebecca, if successful, normally, will be entitled to an order that her costs and disbursements, calculated on the ordinary basis, be paid, whilst Mica, as the administrator representing the estate in the proceedings, irrespective of the outcome of the proceedings, normally, will be entitled to an order that her costs, calculated on the indemnity basis, be paid out of the estate and/or notional estate, of the deceased.
Rebecca's solicitor, Ms O Nikolovska, estimated Rebecca's costs and disbursements of the proceedings, including counsel's fees, calculated on the ordinary basis, to be about $23,194 (inclusive of GST and upon the basis of a one day hearing).
Mica's solicitor, Mr C M Henaghan, estimated Mica's costs and disbursements of the proceedings, including counsel's fees, calculated on the indemnity basis, to be $35,412 (inclusive of GST and upon the basis of a one day hearing).
I shall refer, later in these reasons, to Practice Note SC Eq 7 and the general rules on costs in an estate with a value of less than $500,000.
It follows that, if orders for costs are made, and if the costs estimates prove accurate ($58,606), and if the costs of sale of the Lightning Ridge property are deducted ($7,000), the net value of the deceased's property that may be designated as notional estate will be about $149,394. If the funeral and testamentary expenses, and the administration costs, paid by Mica, are deducted (to be reimbursed to Mica), then the value will be reduced to $122,861.
The parties agreed that the only eligible person who has commenced proceedings under the Act is Rebecca. Of course, Mica, as the wife of the deceased at the date of his death, is also an eligible person, but she has not brought any proceedings. However, as a beneficiary entitled on intestacy, the Court will not disregard her interests. Later in these reasons, I shall refer to her competing claim as a beneficiary.
Other Agreed Facts
In 1993, the deceased purchased a property in Nerang, Queensland, for $170,000, which was registered in his name alone. In 2004, he transferred that property to Mica. There is no dispute that Mica gave no consideration to the deceased for the transfer of that property to her.
Mica and the deceased used the property at Nerang as their home whilst in Queensland.
The title search of this Nerang property also reveals that in November 2011, a mortgage in favour of Westpac Banking Corporation was registered on the title. Mica gave evidence that the amount secured by the mortgage, at the date of the deceased's death, was about $17,000.
In 2013, Mica sold the Nerang property for approximately $410,000. The costs and expenses of sale amounted to about $12,000. From the balance of the sale proceeds, she paid certain credit card debts ($17,000) and purchased another property, in Nerang, for $295,000. Following the payment of the costs and expenses of sale, including stamp duty, and after certain renovations were carried out on that property, Mica states that she retained $20,000 as savings. (The mortgage which had existed on the Nerang property gifted to Mica by the deceased was "transferred" onto the property that Mica purchased. The debt secured by the mortgage is currently about $16,000.)
Mica remains the sole registered proprietor of the Nerang property purchased in 2013.
The Statutory Scheme - The Act
Introduction
Next, I shall discuss the statutory scheme that is relevant to the facts of the present case. Although I have set out most of what I state hereunder in other cases, in view of the importance of this case to the parties, I shall repeat the principles. It is equally important that they are able to follow the reasoning and for each to be satisfied that I have considered the evidence and the submissions in the application.
The former Act was repealed by s 5 of the Succession Amendment (Family Provision) Act 2008 (NSW). A new Chapter 3 was added to the Act, which dealt with the topic of family provision from deceased estates. The long title of the Act describes that new Chapter as one to ensure that adequate provision is made for the members of the family of a deceased person, and certain other persons, from the estate of the deceased person. Importantly, this should not be taken to mean that the Act confers upon those persons a statutory entitlement to receive a certain portion of a deceased person's estate. Nor does it impose any limitation on the deceased's power of disposition by his, or her, Will. It is only if the statutory conditions are satisfied that the Court is empowered, under the Act, to alter the deceased's disposition of his, or her, estate, to produce a result that is consistent with the purpose of the Act. Even then, the Court's power to do so is discretionary.
Section 58(2) of the Act provides that an application for a family provision order must 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.
There is no dispute that Rebecca commenced her proceedings within time.
The key provision is s 59 of the Act. The Court must be satisfied, first, that an applicant is an eligible person within the meaning of s 57(1) (s 59(1)(a)). In New South Wales, there is a multi-category based eligibility system, rather than one with a general category of eligibility (as it is, for example, in Victoria). There are six categories of persons by, or on whose behalf, an application may be made.
Relevantly, in this case, Rebecca relies upon the category of eligibility referred to in s 57(1)(c) of the Act. There is no dispute that she is "a child of the deceased" and an eligible person within the meaning of that term in the Act.
The language of the relevant section is expressive of the person's status, as well as her, or his, relationship to the deceased. There is no age limit placed on a child making an application.
It is only if eligibility is established, that the Court must determine whether adequate provision for the proper maintenance, education or advancement in life of the applicant has not been made by the Will of the deceased, or by the operation of the intestacy rules in relation to the estate of the deceased, or both (s 59(1)(c)). It is this mandatory legislative imperative that drives the ultimate result and it is only if the Court is satisfied of the inadequacy of provision, that consideration is given to whether to make a family provision order (s 59(2)). Only then may "the Court ... 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".
Allsop P in Andrew v Andrew [2012] NSWCA 308; (2012) 81 NSWLR 656, commented, at 658 [6]:
"... the expression of the task in s 59 is subtly different from the previous legislation. A prohibition against making an order unless satisfied of circumstances of an evaluative character, is different in emphasis from a permission to make an order if satisfied of circumstances of an evaluative character... The exercise of power to make the order is conditioned on the Court being satisfied of certain things in s 59(1). The order that may be made is described in s 59(2). The two elements are described in s 60(1)(b) as 'whether to make [an] ... order and the nature of any ... order.' Section 60(2) provides a detailed body of considerations for the task in s 59."
Basten JA, at 662-3 [26], put the differences this way:
"As appears from the language of the relevant provisions set out at [66]-[67] below, the Succession Act differs from the Family Provision Act in three significant respects. First, although both conferred similar powers on the court, the conditions of their exercise differ. The Family Provision Act required that the court 'shall not make an order ... unless it is satisfied that' the provision made by the testator is 'inadequate': s 9(2). The Succession Act provides that the court 'may ... make a family provision order ... if the court is satisfied that' the testator has not made "adequate provision" for the applicant: s 59(1). The changes in language may have been intended to remove double negatives, but there is a resultant change in emphasis. The apparent effect is to widen the discretion vested in the court. That which could satisfy a court that the provision made is 'not adequate', for the purposes of the Succession Act, might not have been sufficient to remove the prohibition under the Family Provision Act, which operated in the absence of affirmative satisfaction that the provision was 'inadequate'. There may well be no bright line boundary between adequacy and inadequacy."
Barrett JA, at 677-8 [82] - [86], said:
"The court's task under the new legislation is in substance the same as that under the old. Three differences relevant to the kind of case under discussion may, however, be noted (I leave to one side as irrelevant to such cases the extension of the s 60(2) criteria to the question of 'eligible person' status); and two postulated differences may be rejected.
First, the Succession Act provisions direct attention, upon the initial inquiry into adequacy, to provision made by the deceased's will and the intestacy laws. The former legislation referred merely to provision 'out of the estate' but it was clear that the operation of the intestacy laws was to be taken into account in deciding what provision was available 'out of the estate': see, for example, Smilek v Public Trustee [2008] NSWCA 190.
Second, the Succession Act confines attention, upon that initial inquiry, to provision made by the will and the intestacy laws. There is no reference to provision made during the deceased's lifetime. In this respect, there is a departure from the Family Provision Act approach under which provision made in favour of the eligible person "either during the person's lifetime or out of the person's estate" was to be examined upon the initial inquiry into adequacy.
Attention may, however, still be given to provision made in favour of the applicant during the deceased's lifetime. That is now one of the factors to which regard may be had under s 60(1)(b) when the court is deciding whether to make a family provision order and the nature of the order: see s 60(2)(i). Under the Succession Act, therefore, provision made by the deceased while living thus has a continuing relevance with altered emphasis. Such provision is no longer something to be taken into account in deciding whether adequate provision has been made; but it may be taken into account in deciding whether an order should be made and the nature of the order.
The third difference to be noted is the Succession Act's more comprehensive catalogue of matters that may be taken into account in formulating an order for provision. Section 9(3) of the Family Provision Act empowered the court to 'take into consideration' matters there stated in 'determining what provision (if any) ought to be made in favour of an eligible person out of the estate or notional estate of a deceased person'. Section 60(1)(b) of the Succession Act allows the court to 'have regard to' the matters set out in s 60(2) 'for the purpose of determining ... whether to make a family provision order and the nature of any such order'. The Succession Act lists a greater number of such matters than did the Family Provision Act."
Relevantly to this case, other than by reference to the provision made by the operation of the intestacy rules in relation to the estate of the deceased, s 59(1)(c) of the Act leaves undefined the norm by which the Court must determine whether the provision, if any, is inadequate for the applicant's proper maintenance, education and advancement in life. The question would appear to be answered by an evaluation that takes the Court to the provision actually made on intestacy, on the one hand, and to the requirement for maintenance, education and advancement in life of the applicant on the other. No criteria are prescribed in the Act as to the circumstances that do, or do not, constitute inadequate provision for the proper maintenance, education and advancement in life of the applicant.
In Grey v Harrison [1997] 2 VR 359, at 366-367, Callaway JA observed:
"There is no single provision of which it may be said that that is the provision that a wise and just testator would have made. There is instead a range of appropriate provisions, in much the same way as there is a range of awards for pain and suffering or a range of available sentences. Minds may legitimately differ as to the provision that should be made. Furthermore, it is not at all clear that reasons for an appropriate provision need be fully articulated. To borrow again from the analogy of sentencing, what is required is an instinctive synthesis that takes into account all the relevant factors and gives them due weight."
It was said in the Court of Appeal (by Basten JA) in Foley v Ellis [2008] NSWCA 288, at [3], that the state of satisfaction "depends upon a multi-faceted evaluative judgment". In Kay v Archbold [2008] NSWSC 254, at [126], White J said that the assessment of what provision is proper involved "an intuitive assessment". Stevenson J has described it as "an evaluative determination of a discretionary nature, not susceptible of complete exposition" and one which is "inexact, non-scientific, not narrow or purely mathematical, and fact and circumstance specific": Szypica v O'Beirne [2013] NSWSC 297, at [40] (citing Manuel v Lane [2013] NSWCA 61, at [9], per Emmett JA, speaking in relation to s 20 of the Property (Relationships) Act 1984 (NSW)).
Under s 59(1)(c) of the Act, the time at which the Court gives its consideration to the question of inadequacy of provision is the time when the Court is considering the application.
"Provision" is not defined by the Act, but it was noted in Diver v Neal [2009] NSWCA 54; (2009) 2 ASTLR 89, at [34], that the term "covers the many forms of support and assistance which one individual can give to another. That support and assistance will vary over the course of the person's lifetime".
Neither is the word "maintenance", nor the phrase "advancement in life", defined in the Act.
The term "maintenance" usually refers to a provision for the supply of the necessaries of life. However, in Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191; (2005) 213 ALR 692; (2005) 79 ALJR 731, Callinan and Heydon JJ, at 228-229, said, of the words "maintenance", "support" and "advancement":
"'Maintenance' may imply a continuity of a pre-existing state of affairs, or provision over and above a mere sufficiency of means upon which to live. 'Support' similarly may imply provision beyond bare need. The use of the two terms serves to amplify the powers conferred upon the court. And, furthermore, provision to secure or promote 'advancement' would ordinarily be provision beyond the necessities of life. It is not difficult to conceive of a case in which it appears that sufficient provision for support and maintenance has been made, but that in the circumstances, say, of a promise or an expectation reasonably held, further provision would be proper to enable a potential beneficiary to improve his or her prospects in life, or to undertake further education."
In Alexander v Jansson [2010] NSWCA 176, Brereton J (with whom Basten JA and Handley AJA agreed), at [18], stated:
"'Proper maintenance' is not limited to the bare sustenance of a claimant [cf Gorton v Parkes [sic] [1989] 17 NSWLR 1], but requires consideration of the totality of the claimant's position in life including age, status, relationship with the deceased, financial circumstances, the environs to which he or she is accustomed, and mobility."
In J D Heydon and M J Leeming, Jacobs' Law of Trusts in Australia (7th ed, 2006, LexisNexis Butterworths), at 542, the learned authors comment upon the difference between the concepts of maintenance and advancement:
"The essential difference between 'maintenance' and 'advancement' is that 'maintenance' denotes a periodical payment or a payment which could validly be made periodically, whereas 'advancement' denotes a definite unique outlay for a specific purpose. Recipients of maintenance must, practically speaking, be infants, but adults may be recipients of an advancement.
An advancement can never be made of a sum of money which the person to whom it is made can immediately pocket, but it must be made with a view to the establishment of that person in a business or profession, or otherwise in some definite way for that person's benefit, the whole essence of an advancement being the immediate payment of a tolerably large sum for an immediate benefit to one beneficiary."
In Goodman v Windeyer [1980] HCA 31; (1980) 144 CLR 490; (1980) 31 ALR 23; (1980) 54 ALJR 470, Murphy J noted, at 505:
"Provision for advancement may, for example, extend to retraining or the gaining of a qualification which could advance and perhaps enable an applicant to maintain himself or herself."
In In the Estate of Puckridge, Deceased (1978) 20 SASR 72, at 77 King CJ said:
"The words 'advancement in life' have a wide meaning and application and there is nothing to confine the operation of the provision to an earlier period of life in the members of the family: Blore v Lang [(1960) 104 CLR 124] per Dixon CJ at p. 128."
Master Macready (as his Honour then was) in Stiles v Joseph (Supreme Court (NSW), Macready M, 16 December 1996, unrep) said, at 14-16:
"Apart from the High Court's statement that the words 'advancement in life' have a wide meaning and application ... there is little (if any) case law on the meaning of 'advancement' in the context of family provision applications. Zelling J in In The Estate of Wardle (1979) 22 SASR 139 at 144, had the same problem. However, commonly in decisions in which the Applicant's 'advancement in life' has been in issue, the Court has looked only at the material or financial situation of the Applicant, and there is nothing to suggest that provision for the Applicant's 'advancement in life' means anything more than material or financial advancement. For example, in Kleinig v Neal (No 2) [1981] 2 NSWLR 532, Holland J, discusses the financial assistance which an applicant may need for his or her maintenance and advancement in life in the following terms:- If the court is to make a judgment as to what a wise and just testator ought to have done in all the circumstances of the case, it could not be right to ignore that the particular testator was a wealthy man in considering what he ought to have done for his widow or children in making provision for their maintenance, education or advancement in life. There are different levels of need for such things. In the case of maintenance and advancement in life they can range from bare subsistence up to anything short of sheer luxury. A desire to improve one's standard of living or a desire to fulfil one's ambition for a career or to make the fullest use of one's skills and abilities in a trade or business, if hindered or frustrated by the lack of financial means required for the fulfilment of such desire or ambition, presents a need for such assistance and it would seem to me that it is open to a court to say, in the case of a wealthy spouse or parent who could have but has failed to provide such financial assistance, that ... [the deceased] has failed to make adequate provision for the proper maintenance and advancement in life of the spouse or children who had such need. (at 541)
In Pilkington v Inland Revenue Commissioners [1964] AC 612, Viscount Radcliffe defined 'advancement', in the context of a trustee's powers, as 'any use of ... money which will improve the material situation of the beneficiary' (at 635), and this definition was cited with approval by Pennycuick J in Re Clore's Settlement Trust; Sainer v Clore [1966] 2 All ER 272 at 274...
In Certoma, The Law of Succession In New South Wales (2nd Ed) at 208, it is said:
'Although 'maintenance' does not mean mere subsistence, in the context of the New South Wales Act, it probably does not extend to substantial capital investments such as the purchase of a business, an income-producing property or a home for the Applicant because these forms of provision are more likely to be within the power of the Court under 'advancement in life'. Maintenance is rather concerned with the discharge of the recurrent costs of daily living and not generally with substantial capital benefit.'
The Queensland Law Reform Commission, in its Working Paper on Uniform Succession Laws: Family Provision (Working Paper 47, 1995) ... notes ... that:
'Whereas support, maintenance and education are words traditionally associated with the expenditure of income, advancement has been associated with the expenditure of capital, such as setting a person up in business or upon marriage.'"
In Mayfield v Lloyd-Williams [2004] NSWSC 419, White J, at [114] noted:
"In the context of the Act the expression 'advancement in life' is not confined to an advancement of an applicant in his or her younger years. It is phrase of wide import. (McCosker v McCosker (1957) 97 CLR 566 at 575) The phrase 'advancement in life' has expanded the concept used in the Victorian legislation which was considered in Re Buckland permitting provision to be made for the 'maintenance and support' of an eligible applicant. However Adam J emphasised that in a large estate a more extravagant allowance for contingencies could be made than would be permissible in a small estate and still fall within the conception of maintenance and support."
In Bartlett v Coomber [2008] NSWCA 100, at [50], Mason P said:
"The concept of advancement in life goes beyond the need for education and maintenance. In a proper case it will extend to a capital payment designed to set a person up in business or upon marriage (McCosker v McCosker (1957) 97 CLR 566 at 575; Stiles v Joseph, (NSW Supreme Court, Macready M, 16 December 1996); Mayfield v Lloyd-Williams [2004] NSWSC 419)."
In McCoskerv McCosker [1957] HCA 82; (1957) 97 CLR 566; (1957) 31 ALJR 779, Dixon CJ and Williams J stated, at 575:
"The presence of the words 'advancement in life' in the ... Act in addition to the words 'maintenance and education' is not unimportant. ... 'Advancement' is a word of wide import."
The word "adequate" connotes something different from the word "proper". "Adequate" is concerned with the quantum, whereas "proper" prescribes the standard, of the maintenance, education and advancement in life: Devereaux-Warnes v Hall (No 3) [2007] WASCA 235; (2007) 35 WAR 127, per Buss JA, at 145 [72], [77].
These words were considered by Lord Romer in delivering the advice of the Privy Council in Bosch v Perpetual Trustee Co Ltd [1938] AC 463, at 476:
"The use of the word 'proper' in this connection is of considerable importance. It connotes something different from the word 'adequate'. A small sum may be sufficient for the 'adequate' maintenance of a child, for instance, but, having regard to the child's station in life and the fortune of his father, it may be wholly insufficient for his 'proper' maintenance. So, too, a sum may be quite insufficient for the 'adequate' maintenance of a child and yet may be sufficient for his maintenance on a scale that is 'proper' in all the circumstances."
Dixon CJ and Williams J, in McCosker v McCosker, at 571-572, after citing Bosch v Perpetual Trustee Co Ltd, went on to say, of the word "proper", that:
"It means 'proper' in all the circumstances of the case, so that the question whether a widow or child of a testator has been left without adequate provision for his or her proper maintenance, education or advancement in life must be considered in the light of all the competing claims upon the bounty of the testator and their relative urgency, the standard of living his family enjoyed in his lifetime, in the case of a child his or her need of education or of assistance in some chosen occupation and the testator's ability to meet such claims having regard to the size of his fortune. If the court considers that there has been a breach by a testator of his duty as a wise and just husband or father to make adequate provision for the proper maintenance education or advancement in life of the applicant, having regard to all these circumstances, the court has jurisdiction to remedy the breach and for that purpose to modify the testator's testamentary dispositions to the necessary extent."
In Goodman v Windeyer, Gibbs J said, at 502:
"[T]he words 'adequate' and 'proper' are always relative. There are no fixed standards, and the court is left to form opinions upon the basis of its own general knowledge and experience of current social conditions and standards."
In Vigolo v Bostin, at 228, Callinan and Heydon JJ said:
"[T]he use of the word 'proper' ... implies something beyond mere dollars and cents. Its use, it seems to us, invites consideration of all the relevant surrounding circumstances and would entitle a court to have regard to a promise of the kind which was made here...The use of the word 'proper' means that attention may be given, in deciding whether adequate provision has been made, to such matters as what used to be called the 'station in life' of the parties and the expectations to which that has given rise, in other words reciprocal claims and duties based upon how the parties lived and might reasonably expect to have lived in the future."
Santow J pointed out, in Gardiner v Gardiner (Supreme Court (NSW), Santow J, 28 May 1998, unrep), that "adequate" and "proper" are independent concepts. His Honour said, at 12:
"'Adequate' relates to the needs of the applicant. It is determined by reference to events occurring up to the death of the deceased, but also encompassing what the deceased might reasonably have foreseen before death. 'Proper' depends upon all the circumstances of the case. These include the applicant's station in life, the wealth of the deceased, the means and proper claims of all applicants, the relative urgency of the various claims on the deceased's bounty, the applicant's conduct in relation to the deceased, the applicant's contribution to building up the deceased's estate, the existence of dependents upon the applicant, the effects of inflation, the applicant's age and sex, and whether the applicant is able-bodied ..."
In Palaganio v Mankarios [2011] NSWSC 61, at [72], White J observed that the question of what provision for a person's maintenance, education or advancement in life is "proper" and the question of whether the provision made by the deceased was "adequate" for that person's maintenance, education or advancement in life involve value judgments on which minds can legitimately differ, and that there are no definite criteria by which the question can be answered.
His Honour further observed, in Slack v Rogan; Palffy v Rogan [2013] NSWSC 522, at [123]:
"The question of what level of maintenance or advancement in life is 'proper' depends on all of the circumstances of the case 'including 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' (Singer v Berghouse (1994) 181 CLR 201 at 210)."
Until recently, it was unanimously thought that there are two stages of the determination. The first stage, provided for by s 59(1)(c), has been described as "the jurisdictional question": Singer v Berghouse(No 2) [1994] HCA 40; (1994) 181 CLR 201; (1994) 123 ALR 481; (1994) 68 ALJR 653 at 208-209. At this stage, the Court will consider whether it can make an order for provision for the maintenance, education or advancement in life of a particular applicant. The Court does this by determining whether it is satisfied that adequate provision for the proper maintenance, education or advancement in life of the applicant has not been made by the Will of the deceased and/or by operation of the intestacy rules, for the applicant. If it is not so satisfied, then the Court is precluded from making a family provision order. At this stage, the Court has regard to, among other things, 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 circumstances and needs of the other beneficiaries or potential beneficiaries: see McCosker v McCosker, at 571-572; Singer v Berghouse (No 2), at 209-210; Vigolo v Bostin, at [16], [75], [112]; Tobin v Ezekiel [2012] NSWCA 285; (2012) 83 NSWLR 757, at [70].
Whether an applicant has a 'need' or 'needs' is also a relevant factor at the first stage of the enquiry. It is an elusive concept to define, yet, it is an element in determining whether "adequate" provision has been made for the "proper" maintenance, education and advancement in life of the applicant in all of the circumstances: Collins v McGain [2003] NSWCA 190 (Tobias JA, with whom Beazley and Hodgson JJA agreed).
In Collins v McGain, Tobias JA said:
"42. Further, there can be no question that, at least as part of the first stage of the process, the question of whether the eligible person has a relevant need of maintenance etc is a proper enquiry. This is so as the proper level of maintenance etc appropriate for an eligible person in all the circumstances clearly calls for a consideration of his or her needs. However, the question of needs must not be too narrowly focussed. It must, in my view, take into account, depending upon the particular circumstances of the case, present and future needs including the need to guard against unforeseen contingencies.
...
47. As I have observed, the issue of need is not confined to whether or not an eligible person has, at the date of hearing, a then need for financial assistance with respect to his maintenance etc. It is a broader concept. This is so because the question of needs must be addressed in the context of the statutory requirement of what is 'proper maintenance etc' of the eligible person. It is because of that context that, in the present case, the 'proper maintenance etc' of the appellant required consideration of a need to guard against the contingency to which I have referred."
In Devereaux-Warnes v Hall (No 3), at [81] - [84], Buss JA said, in respect of the first stage of the process:
"The term 'need' has been used to refer to the claimant's inability to satisfy his or her financial requirements from his or her own resources: see Singer (at 227) per Gaudron J.
'Need' has also been used in the context of a value judgment or conclusion, namely, that the claimant is 'in need' of maintenance, etc, because inadequate provision has been made for his or her proper maintenance, etc: see Gorton v Parks (1989) 17 NSWLR 1 (at 10-11) per Bryson J.
The determination of whether the disposition of the deceased's estate was not such as to make adequate provision for the proper maintenance, etc, of the claimant will always, as a practical matter, involve an evaluation of the provision, if any, made for the claimant on the one hand, and the claimant's 'needs' that cannot be met from his or her own resources on the other: see Hunter (at 575) per Kirby P.
Although the existence or absence of 'needs' which the claimant cannot meet from his or her own resources will always be highly relevant and, often, decisive, the statutory formulation, and therefore the issue in every case, is whether the disposition of the deceased's estate was not such as to make adequate provision for his or her proper maintenance, etc: see Singer (at 227) per Gaudron J. Compare Gorton (at 6-11) per Bryson J; Collicoat v McMillan [1999] 3 VR 803 at [38], [47] per Ormiston J."
"Need", of course, is a relative concept: de Angelis v de Angelis [2003] VSC 432, per Dodds-Streeton J, at [45].
As Callinan and Heydon JJ emphasised, in Vigolo v Bostin, at 231 [122], the question of the adequacy of the provision made by the deceased "is not to be decided in a vacuum, or by looking simply to the question whether the applicant has enough upon which to survive or live comfortably". The inquiry is not confined only to the material circumstances of the applicant. The whole of the context must be examined.
In the event that the Court is satisfied that the power to make an order is enlivened (in this case it is satisfied that the applicant is an eligible person, and that adequate provision for the proper maintenance, education or advancement in life of the person has not been made), then the Court determines whether it should make an order and, if so, the nature of any such order, having regard to the facts known to the Court at the time the order is made.
The second stage of the process arises under s 59(2) and s 60(1)(b) of the Act. Mason CJ, Deane and McHugh JJ, in Singer v Berghouse (No 2), at 211, affirmed that the decision made at the second stage involves an exercise of discretion in the accepted sense. The fact that the Court has a discretion means that it may refuse to make an order even though the jurisdictional question has been answered in the applicant's favour.
I have dealt with the question that has been raised in the cases whether the two-stage approach identified in Singer v Berghouse (No 2) continues to apply to the provisions of the Act in other cases, the most recent of which is Aubrey v Kain [2014] NSWSC 15. I remain of the view that the two-stage approach should continue to apply. I shall not repeat what I said in that case, which is not affected by the recent decision of the Court of Appeal in Phillips v James [2014] NSWCA 4.
Section 60 of the Act, at least in part, is new. It provides:
"(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.
(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,
(f) any physical, intellectual or mental disability of the applicant, any other person in respect of whom an application has been made for a family provision order or any beneficiary of the deceased person's estate that is in existence when the application is being considered or that may reasonably be anticipated,
(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,
(k) whether the applicant was being maintained, either wholly or partly, by the deceased person before the deceased person's death and, if the court considers it relevant, the extent to which and the basis on which the deceased person did so,
(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,
(o) any relevant Aboriginal or Torres Strait Islander customary law,
(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."
It can be seen that s 60(2) enumerates 15 specific matters, described by Basten JA in Andrew v Andrew, at [37], as "a multifactorial list", and by Lindsay J, in Verzar v Verzar [2012] NSWSC 1380, at [123], as "a valuable prompt" to which the Court may have regard, together with "any other matter the court considers relevant", for the purposes of determining eligibility, whether to make a family provision order and the nature of any such order.
Beazley P, in Phillips v James, at [51], described s 60(2) as involving:
"... a statutory iteration of matters that had always been considered relevant in the determination of claims for provision by persons claiming an entitlement under a testator's will. However, as Basten JA observed in Andrew v Andrew, the factors identified in s 60(2) provide a more focussed direction to the Court as to relevant matters to which regard may be had. His Honour was of the view that the statutory list invites consideration of a broader range of factors than was previously the case. Whether or not that is so, the important matter is that the Court is required to have regard to the circumstances, including those specified in s 60(2), that it considers relevant in determining whether to make an order for family provision and the nature of any such order."
White J, in Slack v Rogan; Palffy v Rogan, at [121], wrote that s 60 "lists a wide range of matters that the Court 'may have regard to', but these do not provide any tangible assistance in answering the question in any particular case whether the provision made in a will, or on intestacy, was less than adequate for an eligible applicant's 'proper' maintenance, education or advancement in life".
In West v Mann [2013] NSWSC 1852, Kunc J, at [12], wrote:
"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.
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 section does not prioritise the catalogue of matters that may be taken into account. No matter is more, or less, important than any other. The weight of such of the matters specified in the section, which may be taken into account, will depend upon the facts of the particular case. There is no mandatory command to take into account any of the matters enumerated. None of the matters listed is, necessarily, of decisive significance and none differentiate, in their application, between classes of eligible person. Similarly, there is no distinction based on gender.
The Act does not say how the matters listed are to be used to determine the matters identified in s 60(1). Considering each of the relevant matters does not prescribe a particular result and, whilst there is likely to be a substantial overlap in the matters that the Court may take into account when determining the answers to what is posed in s 60(1), those matters are not identical. For example, when considering eligibility under s 60(1)(a), many of the matters in s 60(2) will be largely, if not wholly, irrelevant.
Section 60(2)(d) refers to "earning capacity", which means no more than the capacity to find employment to earn or derive income.
A reference to some of the matters in s 60(2) not only permits, but requires, a comparison to be made between the respective positions of the applicant and any other eligible person, as well as of any beneficiary, whilst others do not. Importantly, also, many of the matters in sub-section (2), of themselves, are incapable of providing an answer to the questions posed in s 60(1).
Leaving aside the question of eligibility, the matters referred to in s 60(2) may be considered on "the discretionary question", namely whether to make an order and the nature of that order. Importantly, under s 60(2), attention is drawn to matters that may have existed at the deceased's death, or subsequently.
This does not mean, however, that some of the matters referred to in s 60(2) will not be relevant to the jurisdictional question to be determined at the first stage. Happily, I am not alone in reaching this conclusion which is supported by the following comments made in Singer v Berghouse (No 2), at 209 - 210:
"... The determination of the first stage in the two-stage process calls for an assessment of whether the provision (if any) made was inadequate for 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 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."
It is also supported by the comments of Callinan and Heydon JJ in Vigolo v Bostin, at 230 - 231:
"We do not therefore think that the questions which the court has to answer in assessing a claim under the Act necessarily always divide neatly into two. Adequacy of the provision that has been made is not to be decided in a vacuum, or by looking simply to the question whether the applicant has enough upon which to survive or live comfortably. Adequacy or otherwise will depend upon all of the relevant circumstances, which include any promise which the testator made to the applicant, the circumstances in which it was made, and, as here, changes in the arrangements between the parties after it was made. These matters however will never be conclusive. The age, capacities, means, and competing claims, of all of the potential beneficiaries must be taken into account and weighed with all of the other relevant factors."
As was also pointed out by Barrett JA, in Andrew v Andrew, at [88] - [89]:
"... leaving aside its relevance to the 'eligible person' inquiry, the s 60(2) catalogue is directed to the question of what, if any, order for provision should be made and is not, in terms, applied to the initial question of the adequacy of the provision made by the will or the intestacy laws.
It can be said at once that the s 60(1)(b) directive corresponds with that in the former s 9(3) to the extent that it relates to the decision regarding provision to be made. There is no express legislative intention, under either piece of legislation, that the enumerated factors are to be taken into account in deciding the initial question of adequacy of provision. There is accordingly no reason to think that those factors are to be afforded any special relevance in approaching the adequacy question. But they will, at that point, be given, independently of s 60(1)(b), such weight as they deserve in their own right as indicators of the 'adequacy' question. As the primary judge recognised at [57], this is consistent with what was said by the High Court in Singer v Berghouse in relation to the former Act."
As was confirmed by Beazley P in Phillips v James, at [49] and [53], "there may not be a strict or bright line division between each stage of the process".
Section 63 identifies the property that may be used for a family provision order. An order for provision may be made out of the estate of the deceased. An order may be made in relation to property that is not part of the estate of a deceased, or that has been distributed, if it is designated as notional estate of the deceased person by an order under Part 3.3 of the Act (to which I shall turn).
Section 65(1) of the Act requires the family provision order to specify:
(a) the person or persons for whom provision is to be made, and
(b) the amount and nature of the provision, and
(c) the manner in which the provision is to be provided and the part or parts of the estate out of which it is to be provided, and
(d) any conditions, restrictions or limitations imposed by the Court.
The order for provision may require the provision to be made in a variety of ways, including a lump sum, periodic sum, or "in any other manner the court thinks fit" (s 65(2) of the Act). If the provision is made by payment of an amount of money, the order may specify whether interest is payable on the whole, or any part, of the amount payable for the period, and, if so, the period during which interest is payable and the rate of interest (s 65(3) of the Act).
Section 66 of the Act sets out the consequential and ancillary orders that may be made.
Any family provision order under the Act takes effect, unless the Court otherwise orders, as if the provision was made in a codicil to the Will of the deceased, or as here, in the case of intestacy, as in a Will of the deceased (s 72(1) of the Act).
Section 99(1) of the Act provides that the Court may order the costs of proceedings in relation to the estate, or notional estate, of the deceased (including costs in connection with mediation) to be paid out of the estate in such manner as the Court thinks fit.
Practice Note SC Eq 7, which applies to claims for a family provision order, currently provides, in Clause 24, that "[o]rders may be made capping the costs that may be recovered by a party in circumstances including, but not limited to, cases in which the value of the estate is less than $500,000".
For reasons mentioned earlier, it is unnecessary to discuss the notional estate provisions of the Act.
Other Applicable Legal Principles - Substantive Application
Accepting that no two cases will be exactly alike, there are some general principles that may be stated. Whilst most of these principles were stated in the context of the former Act, they are equally apt in a claim brought pursuant to the Act.
Bryson J noted, in Gorton v Parks (1989) 17 NSWLR 1, at 6, that it is not appropriate to endeavour to achieve "an overall fair" disposition of the deceased's estate. It is not part of the Court's function to achieve some kind of equity between the various claimants. The Court's role is not to reward an applicant, or to distribute the deceased's estate according to notions of fairness or equity. Nor is the purpose of the jurisdiction conferred by the Act to correct the hurt feelings, or sense of wrong, felt by an applicant. Rather, the Court's role is of a specific type and goes no further than the making of "adequate" provision in all the circumstances for the "proper" maintenance, education and advancement in life of an applicant.
The Court's discretion is not untrammelled, or to be exercised according to idiosyncratic notions of what is thought to be fair, or in such a way as to transgress, unnecessarily, upon the deceased's freedom of testation: Pontifical Society for the Propagation of the Faith v Scales [1962] HCA 19; (1962) 107 CLR 9; (1962) ALR 775; (1962) 36 ALJR 1, at 19 (Dixon CJ); McKenzie v Topp [2004] VSC 90, at [63].
As Pembroke J said in Wilcox v Wilcox [2012] NSWSC 1138 at [23]:
"The court does not simply ride roughshod over the testator's intentions. The court's power to make an award is limited. The purpose of the discretionary power under Section 59(1) is to redress circumstances where 'adequate provision' has not been made for the 'proper maintenance, education or advancement in life' of the claimant. The adjectives 'adequate' and 'proper' are words of circumspection. They imply no more than is necessary. I should ensure that 'adequate provision', rather than generous provision, is made, having regard to the burden on the defendant."
Of course, in this case, the pre-ordained scheme for distribution of the deceased's estate is not according to the wishes of the deceased as expressed in his Will, but according to the regime established by statute. It was said in Uniform Succession Laws: Intestacy [2007] NSWLRC 116:
"1.23 The rules of distribution on intestacy are, at the most general level, the community's view of what should be done with the estate of a person who has died intestate. The parliaments of the various Australian jurisdictions, as representatives of their communities, have established and amended the rules from time to time. One of the purposes of this Report is to determine the extent to which any proposed scheme of distribution meets the collective requirements of the Australian community [Footnotes omitted]".
In Re Estate of Bridges (1975) 12 SASR 1, Bray CJ noted:
"In the case of an intestacy, as much as in the case of a will, it seems to me that Parliament has indicated its intention that the scheme of things set up by a testator in his will, or by the law of the State in the event of intestacy, shall be interfered with so far as is necessary to make adequate provision for the proper maintenance, education and advancement of the claimants specified in the Act, but no further. It is true that when the persons entitled on intestacy are the surviving spouse and legitimate children of the deceased as opposed to collateral relations the speculation that the deceased may have intended to die intestate may have more cogency, but nevertheless I repeat that I think the correct approach is as I have said. I think that Parliament no more intended to grant an unlimited liberty to recast dispositions resulting from the law of intestacy on moral grounds than it did to give a similar liberty to recast dispositions made by will."
In Kossert v Margaret Gerda Ruggi As Executor of the Will of Peter Korps [No 2] [2012] WASC 191, at [38], Kenneth Martin J, after referring to the passage in Re Estate of Bridges, noted:
"So, in going about the task of resolving this Inheritance Act application... I must respect the effect of the intestacy laws of the day in terms of the result they would deliver..."
The Court is given not only a discretion as to the nature and amount of the provision it directs but, even more importantly, a discretion as to making a provision at all.
In considering the question, the nature and content of what is adequate provision for the proper maintenance, education and 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 (Supreme Court (NSW), Young J, 17 May 1996, unrep) (Young J) (as his Honour then was); Stern v Sekers; Sekers v Sekers [2010] NSWSC 59.
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 s 59(2), should be guided and assisted by considering what provision, in accordance with perceived 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."
How those community expectations or standards are determined cannot be explained other than by reference to the Act: Andrew v Andrew, at [36] (Basten JA). His Honour added, in Phillips v James, at [113]:
"As discussed by Allsop P in Andrew v Andrew [2012] NSWCA 308; 81 NSWLR 656 at [16], one can say little more as to the standards and values to be applied than that the court should be guided by its perception of 'prevailing community standards of what is right and appropriate'. Views will undoubtedly vary within the community as to the weight to be given to a testator's wishes as expressed in the will: Andrew v Andrew at [35]."
Thus, "there are difficulties for the Courts in making their own unaided assessment of current community attitudes in a complex and changing social environment": Williams v Aucutt [2000] 2 NZLR 479 at [44].
In all cases under the Act, what is adequate and proper provision is necessarily fact-specific.
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 (1910) 29 NZLR 959, at 966.
Yet, the purpose of the jurisdiction conferred by the Act is not the correction of the hurt feelings of, or the sense of wrong felt by, the applicant. The Court is obliged simply to respond to the application of the eligible person and to consider whether, as claimed, the provision made by the will is inadequate for that person's proper maintenance and advancement in life (see Golosky v Golosky [1993] NSWCA 111 and Heyward v Fisher (New South Wales Court of Appeal, 26 April 1985, unreported)).
Nor is it the purpose of the Act to punish, or redress, past bad, or unfeeling parental behaviour, where that behaviour does not still impinge on the applicant's present financial situation. In other words, a claim under the Act does not encompass compensation, or reparations, to an applicant for the deceased as his, or her, parent, having failed in the legal, or moral, duty to be a good and responsible parent of the child: Re Bull [2006] VSC 113; Cameron v Cameron [2009] SASC 27, at [41].
All of the financial needs of an applicant have to be taken into account and considered by reference to the other factors referred to in the Act and in Singerv Berghouse (No 2). What is proper provision is not arrived at by adding up all of the identified financial needs: Hyland v Burbidge [2000] NSWSC 12, at [56]. Nor does it follow that, if the Court decides it is inappropriate to make a specific provision in respect of one identified head of claim, that any identified financial need, even a contingent need, in relation to that claim becomes irrelevant to the final assessment: Mayfield v Lloyd-Williams, at [89].
The size of the estate is a significant consideration in determining an application for provision. In a small estate, as this one is, it is important to remember what Salmond J said in In re Allen (Dec'd); Allen v Manchester [1922] NZLR 218, at 221:
"Applications under the Family Protection Act for further provision of maintenance are divisible into two classes. The first and by far the most numerous class consists of those cases in which, owing to the smallness of the estate and to the nature of the testamentary dispositions, the applicant is competing with other persons who have also a moral claim upon the testator. Any provision made by the Court in favour of the applicant must in this class of case be made at the expense of some other person or persons to whom the testator owed a moral duty of support. The estate is insufficient to meet in full the entirety of the moral claims upon it, in the sense that if the testator possessed more he would have been bound to do more for the welfare of his dependants. In such a case all that the Court can do is to see that the available means of the testator are justly divided between the persons who have moral claims upon him in due proportion to the relative urgency of those claims."
Whilst fully contested applications in small estates should be discouraged, because the costs tend to become wholly disproportionate to the end result, there is nothing in the Act that excludes the possibility that orders for further provision be made from a small estate: Morris v Smoel [2014] VSC 32, at [68]. The court must still consider all the relevant circumstances before a decision is made: Re Coventry (deceased) [1979] 3 All ER 815 at 820.
Rebecca's Substantive Claim - The Principles
In relation to Rebecca's claim, being a claim by an adult child, the following principles are useful to remember:
(a) It is impossible to describe in terms of universal application, the moral obligation, 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.
(b) 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. 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, at [58].
(c) 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] VR 404, at 411; Hughes v National Trustees, Executors and Agency Co of Australasia Ltd [1979] HCA 2; (1979) 143 CLR 134; (1979) 23 ALR 321; (1979) 53 ALJR 249, 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 that the applicant, however reasonably, wishes to support, where there is no obligation of the deceased 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].
(d) 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, at 45 (Nicholson J).
(e) 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, at [179] - [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].
(f) 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.
(g) Even if the deceased never knew of the existence of a child, if that child has a strong case based upon other factors, such as needs, the size of the estate and a lack of competing claims, a court could find that that child was left without adequate provision for proper maintenance. The "bare fact of paternity" is "of very great importance in morality": Nicholls v Hall [2007] NSWCA 356, at [43] - [45].
In Foley v Ellis, Sackville AJA, at [88] noted that Singer v Berghouse (No 2) "... strongly suggests that the court cannot consider the propriety and adequacy (or inadequacy) of any testamentary provision for an applicant in isolation from the resources and needs of other claimants on the deceased's bounty. These claimants include other beneficiaries entitled to a share of the deceased's estate, whether or not they themselves have made a claim under the Family Provision Act".
Generally, the duty of the deceased to his widow, to the extent to which his assets permit him to do so, is to ensure that she is secure in the matrimonial home, to ensure that she has an income sufficient to permit her to live in the style to which she is accustomed, and to provide her with a fund to enable her to meet any unforeseen contingencies: see, for example, Luciano v Rosenblum (1985) 2 NSWLR 65, at 69. The Court of Appeal, in O'Loughlin v O'Loughlin [2003] NSWCA 99, approved that "broad general rule".
Of course, Mica is not an applicant for provision, so principles that apply where the widow is one are not entirely apposite. Even so, she does not have to prove an entitlement to the provision made on intestacy or otherwise justify such provision. In determining the case, the Court must have regard to all relevant circumstances including the size of the estate and the nature of the competing claim by the widow: Edgar v Public Trustee for the Northern Territory [2011] NTSC 05, at [46].
In Magill v Magill [2006] HCA 51; (2006) 231 ALR 277; (2006) 81 ALJR 254, at [132], Gleeson CJ, at [24], said:
"The structure of marriage and the family is intended to sustain responsibility and obligation."
This accords too, with what Hodgson JA said in Marshall v Carruthers; Marshall v Marshall [2002] NSWCA 47, at [63]:
"In my opinion, a formal and binding commitment to mutual support through good times and bad, other factors being equal, adds strength to a legitimate claim."
Concern as to the capacity of Mica to maintain herself, independently and autonomously, also bear upon the notion of what provision ought to be made for her. Her age and earning capacity are also relevant.
I make clear that I do not intend what I have described as "principles" to be elevated into rules of law. Nor do I wish to suggest that the jurisdiction should be unduly confined, or the discretion at the second stage to be constrained, by statements of principle found in dicta in other decisions. I identify them merely as providing useful assistance in considering the statutory provisions, the terms of which must remain firmly in mind.
In addition, in each case, a close consideration of the facts is necessary in order to determine whether the bases for a family provision order have been established. Every case is different and must be decided on its own facts. As Lindsay J said in Verzar v Verzar, at [131]:
"Whatever guidance one might draw from analogous cases all analogies, and any guidelines drawn from a pattern of similar cases, must yield to the text of the legislation, the duty of the Court to apply that text to the particular circumstances, and the totality of material circumstances, of each case. Preconceptions and predispositions, comforting though they may be, can be the source of inadequate consideration of the jurisdiction to be exercised: Bladwell v Davis [2004] NSWCA 170 at [12] and [18]-[19]."
Credibility of the Witnesses
There are relatively few factual issues that depend on the acceptance or rejection of evidence in this case. One factual issue relates to the nature of the relationship between Rebecca and the deceased prior to about 1993, when Mica met the deceased. Part of this issue relates to the knowledge of the deceased about the paternity of Rebecca.
In Webb v Ryan [2012] VSC 377, Whelan J referred to the difficulties in assessing the evidence in claims for a family provision order:
"An important matter which may arise in these kinds of cases is the difficulty of assessing evidence concerning things allegedly said by a person who is dead. The court can never be certain it knows all the circumstances, and more often than not one may be sure that the court knows few of them. It is impossible to hear what the other party to the conversation, the deceased, says about it. There is a significant risk of reconstruction. There are dangers in relying on evidence of what may have been a casual observation made to a person who at the time had no reason to remember the exact words used. In the light of these concerns, a substantial burden is placed upon an applicant whose case relies upon such evidence. Such evidence must be very carefully examined."
Prior to the DNA parentage testing having been completed, Rebecca says that she knew the deceased as "Uncle Rade", and believed him to be a close friend of Ljubica and Dimitrije. She spoke to him about whether he was her father, for the first time, in either 2011 or 2012. He stated that he did not know whether he was her father and agreed to have a DNA paternity test, which she requested, to "give her peace of mind".
Ljubica asserts that the deceased knew that Rebecca was his child. She also says that Dimitrije knew and that, when Rebecca was one year old, the three of them "agreed and swore not to reveal the fact" because she and Dimitrije had two other children. She says that each abided the agreement that had been made until 2012.
Ljubica's assertion seems inconsistent with the deceased's response to Rebecca that he "did not know" whether he was her father and his agreement to have a DNA test. By 2011, had he known, there would have been no reason not to admit it to Rebecca, since she had raised the subject of her paternity with him. (The evidence revealed that she had also raised the topic with her half-sister, Dianne, although this fact may not have been known to the deceased. Rebecca herself, had heard that the deceased was her father from a number of other persons, including an aunt.)
Also, by 2011, there would have really been no need for Ljubica not to reveal the truth to Rebecca, especially since Rebecca seemed determined to ascertain the identity of her biological father and had discussed the issue with at least one of her half-sisters.
Ljubica also gave evidence, in her affidavit, that the deceased would help her and Dimitrije, financially and that they would go to Lightning Ridge every Easter and Christmas to spend time with the deceased. She does not say when the deceased's financial assistance began or when it ended.
Her oral evidence was slightly different on this topic. In cross-examination, she said that the deceased did not help her financially "very much" and that they went to Lightning Ridge because her husband liked the warm mineral springs there. Also, they liked travelling by caravan.
I have carefully considered Rebecca's evidence and the evidence of Ljubica about the visits to the deceased. Interestingly, it is not suggested that Rebecca visited the deceased alone, but that all of the family visited. Furthermore, although Ljubica said that Rebecca was "particularly close" to the deceased, she admitted in cross-examination, that he loved all of the children and gave them all birthday and Christmas presents. This is consistent with the deceased being a friend of Ljubica and Dimitrije.
I accept that there may have been a congery of motives for not informing Rebecca of the identity of her father when the topic had not been raised. One motive may have been her continuing welfare and status and that of the other children of the marriage. Another may have been a desire to avoid an irretrievable breakdown of the marriage (although this seems unlikely in circumstances where it is said that Dimitrije knew that he was not Rebecca's father). A further consideration may have been the avoidance of Ljubica's embarrassment: Magill v Magill, at [132].
In cross-examination, Rebecca admitted that she had no contact with the deceased, face to face, or otherwise, between at least 1992 and 2011 or 2012. Between 1994 and about 2000, she had been living in the USA, having obtained a basketball scholarship, for four years, to a college there. She does not give evidence that she told the deceased of the scholarship or of travelling to the USA, either before, or after, she went, and there is no suggestion that she corresponded with him whilst she was away. She did not have any contact with him for over ten years after she returned.
I note that Mica gives evidence, which was not the subject of challenge, that she had no recollection of Rebecca visiting the deceased, or her having had any other contact with the deceased from the time that Mica met him in about 1992. Nor did she recollect him having received any cards, or letters, from Rebecca, on his birthday, at Easter, or at Christmas. She says that there were no photographs of Rebecca, or of any members of her family, kept by the deceased at their home. (Rebecca does not produce any photographs of herself with the deceased.) I accept this evidence, which is somewhat inconsistent with him having knowledge that he had a child.
Mica does, however, give evidence of an occasion in late 2011 or early 2012, when Rebecca's half-sister, Dianne, arranged to have coffee with the deceased, at Helensvale on the Gold Coast, on which occasion, Rebecca came also. She states that there was no discussion of Rebecca's paternity in her presence and that Rebecca was simply introduced as "Dianne's sister". Rebecca responds that she had a conversation with the deceased privately and whilst Dianne and Mica were inside the shop ordering coffee.
I tend to the view that, had Rebecca had the sort of relationship she describes, and had she suspected that the deceased was her father because of the nature of that relationship, it is likely that the question of her paternity would have been raised with him before 2011 or 2012. I have earlier referred to the death of Dimitrije in 2000. Following his death, there was conceivably less of a need to keep the truth about her paternity from Rebecca. This is significant in light of the submission made on behalf of Rebecca that she "had long suspected that the deceased was her father". (She said, in cross-examination, that she came to suspect that the deceased was her father about 3 or 4 years before she approached him.)
Furthermore, once she had confirmed that the deceased was her father, there might have been more of an attempt by her to keep in touch with him. Mica says that there was none and, although Rebecca says that she "tried to contact him", the evidence is that there was no contact.
Rebecca accepts that she did not attend the deceased's funeral, but says that Mica did not tell her about it or about any of the religious ceremonies following his death to which reference has earlier been made. Nothing turns on her failure to do so.
I have also considered Ljubica's evidence regarding the knowledge of the deceased. It is clear that the deceased made no attempt, at least from 1992, to maintain a relationship with Rebecca. That he would not maintain contact with her, after she ceased visiting him in Lightning Ridge with Ljubica and the other members of their family, is consistent with him being unaware that Rebecca was his daughter. I do not think that it is as consistent with the agreement said to have been reached between the deceased, Ljubica and Dimitrije. It is not suggested that a term of any agreement involved the deceased ignoring Rebecca.
I tend to think, also, that it would have been extremely difficult for all of the adults, particularly Dimitrije, to continue a relationship, had the true position been known by them all.
Having considered all of the evidence, I am satisfied that neither Rebecca nor the deceased can be criticised for her, and his, conduct towards the other before the parentage testing was carried out.
Further Additional Facts
I set out the additional facts I am satisfied are either not in dispute, or that, in my view, have been established by the evidence. I do so by reference to s 60(2) of the Act. Where necessary, I shall express the conclusions to which I have come. I have taken this course, not "to dwell on particular matters as if they were, in themselves, determinant of the broad judgments required to be made under s 59" (Verzar v Verzar, at [124]), but in order to complete the recitation of facts that will assist me to determine the questions that must be answered.
(a) any family or other relationship between the applicant and the deceased person, including the nature and duration of the relationship
The following comment has been made by Campbell JA in regard to the Court's consideration of the totality of the relationship between the applicant and the deceased in Hampson v Hampson [2010] NSWCA 359, at [80]:
"The requirement to have regard to the totality of the relationship can in many cases be satisfied by considering the overall quality of the relationship assessed in an overall and fairly broad-brush way, not minutely. Consideration of the detail of the relationship is ordinarily not called for except where there is an unusual factor that bears on the quality of the relationship, such as hostility, estrangement, conduct on the part of the applicant that is hurtful to the deceased or of which the deceased seriously disapproves, or conduct on the part of the applicant that is significantly beneficial to the deceased and significantly detrimental to the applicant, such as when a daughter gives up her prospects of a career to care for an aging parent. Neither entitlement to an award, nor its quantum, accrues good deed by good deed. Indeed, it is a worrying feature of many Family Provision Act cases that the evidence goes into minutiae that are bitterly fought over, often at a cost that the parties cannot afford, and are ultimately of little or no help to the judge."
As stated, Rebecca is the deceased's only child. She is now an adult. Although she states that she had a "close relationship" with the deceased, I do not think that it was as close as she suggested. In any event, it is clear that the relationship was not one of child and parent. She admits that even after she became an adult, she believed that she was the biological daughter of Ljubica and Dimitrije.
Thus, the assumption about Rebecca's paternity formed the conventional basis of the family relationship that she knew until shortly prior to the deceased's death. No doubt, it was created and maintained in many different ways. Presumably, during the marriage of Ljubica and Dimitrije, all family members acted and spoke one to another, and dealt with third parties, on the basis that all three children were children of the marriage. The assumption was made explicit by reference to Dimitrije as Rebecca's father. That assumption pervaded all that the parties did and what they said in relation to the children. Whilst it is an objective fact that Rebecca did not have the benefit of assistance from a person responsible for bringing her into the world, she had the next best thing.
I am satisfied that some relationship was established between Rebecca and the deceased, but it was not to any great extent. It was non-existent between at least 1992 and 2011 or 2012. I consider that Rebecca, in her affidavits, significantly exaggerated its extent. However, there is no suggestion that the failure of this relationship to blossom was her fault, any more than it was that of the deceased.
To the extent that there was a relationship before that time, I consider it had more to do with the relationship of Ljubica and Dimitrije and the deceased than the relationship of the deceased and Rebecca. The birthday and Christmas gifts were to all of the children, not just Rebecca.
(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
There is no definition of the words "obligations" or "responsibilities" to which the sub-section refers in the Act. Importantly, the Act does not expressly refer to, or identify, any "moral duty". Yet, one might conclude that what is to be considered is the nature and extent of any legal, or moral, obligations or responsibilities.
This factor requires a balancing of potentially competing obligations as between an applicant and a beneficiary.
Leaving aside any obligation, or responsibility, arising as a result of their relationship as parent and child, the deceased did not have any legal obligation to Rebecca, as an adult, imposed upon him by statute or common law.
Yet, an obligation or responsibility, to make adequate provision for the proper maintenance, education or advancement in life, is recognised in the case of a child. In Flathaug v Weaver [2003] NZFLR 730, at 737, the origin of the obligation which underpins the Act's recognition of the duty owed by a parent to a child was put in this way:
"The relationship of parent and child has primacy in our society. The moral obligation which attaches to it is embedded in our value system and underpinned by the law. The Family Protection Act recognises that a parent's obligation to provide for both the emotional and material needs of his or her children is an ongoing one. Though founded on natural or assumed parenthood, it is, however, an obligation which is largely defined by the relationship which exists between parent and child during their joint lives."
In the present case, the primacy may not apply with the same force, particularly in circumstances where another person, married to the mother of the child, who is treated as the child's father, raises the child with her mother.
The fact that an applicant was financially independent, for some years, before the deceased's death, is also a relevant consideration in determining the extent of any obligation or responsibility owed.
Because Mica is the widow of the deceased, I should refer to some other principles. Of course, relevant, will be the length of her relationship and subsequent marriage to the deceased. In total, the relationship and marriage spanned 19 years, a long relationship/marriage on any view. (Even the marriage of 14.5 years would be regarded as a long one.)
The deceased also did not have any legal obligation to Mica, as his wife, imposed upon him by statute, common law or otherwise. However, it is clear, as I have stated, that there was an obligation owed to her, as his spouse of a long marriage, on his death.
(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
I have dealt with the nature and extent of the estate. The value of the gross estate is very small. When one considers the debts, funeral and testamentary expenses, and the costs of the proceedings, it is tiny.
(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
Rebecca gave oral evidence of her present financial resources.
Rebecca's employment as a basketball coach with the Australian Institute of Sport concluded in January 2014. Shortly thereafter, she did some casual work, under a contract, with TransLink Queensland, for which she was paid approximately $1,800 to $1,900.
She has recently obtained a coaching position with the South West Metro Pirates, a women's basketball team, playing in the Queensland league. She says she will be paid about $2,000 for this work. The season will commence in about May and end in about August. In addition, she maintains her position as an assistant coach with Women's National Basketball League team, Logan Thunder. She said that she does not receive any remuneration for this work.
Rebecca gives evidence that she is an able and experienced coach.
Rebecca gave evidence that she has recently applied for Newstart benefits and that she has an interview, relating to those benefits, scheduled in early March. She did not give any evidence of what benefits she would expect to receive if her application is successful.
She also gave evidence of a variety of jobs which she has recently applied for, including "[c]ustomer service roles" and positions relating to coaching and sport. She is currently waiting to hear in respect of some of those applications.
I accept that Rebecca has an earning capacity.
Rebecca has approximately $2,100 of savings held in two bank accounts.
Rebecca did not give evidence in any of her affidavits of any superannuation that had been accumulated. Documents she produced, in answer to a notice to produce, revealed that she had superannuation benefits, as at December 2013, of $49,717.
Rebecca gave evidence that she has debts of approximately $6,365 owing on two credit cards, on a personal loan, and on a loan to her half-sister, Dianne. She says that she is currently making minimum repayments on her credit cards and personal loan but that she has not made any repayments to Dianne since November 2013.
Rebecca also referred to medical expenses (to which I shall return) and some possible dental expenses that she may incur in future.
Mica is currently not employed. She has never worked whilst living in Australia. She says that her age, health and circumstances prevent her from obtaining any gainful employment in future.
I accept that Mica does not have any earning capacity.
Mica does not currently receive any social security benefits. (Mica previously received Newstart benefits, prior to 2004, at which time the Lightning Ridge property was transferred to her, rendering her ineligible for future payments. She also previously received a carer's pension during the deceased's treatment for cancer.)
Mica gave evidence that she makes mortgage repayments of $135 per month from her savings and with the financial assistance of her family and friends. She gave evidence, in an affidavit sworn on 5 February 2014, that her savings "have been exhausted" and that she now relies wholly on the assistance of others.
(e) if the applicant is cohabiting with another person - the financial circumstances of the other person
Rebecca lives with her half-sister, Dianne, in Parkwood, Queensland. She contributes $150 per week towards the rent and also pays a share of bills ($50 per week in total).
There is no evidence of Dianne's financial circumstances.
(f) any physical, intellectual or mental disability of the applicant, any other person in respect of whom an application has been made for a family provision order or any beneficiary of the deceased person's estate that is in existence when the application is being considered or that may reasonably be anticipated
Rebecca asserts some physical disability. She says that she was a basketball player and has had sporting injuries, including back problems from 2000, which resulted in surgery in 2008; knee operations in 2006 and 2012; and a "frozen shoulder" problem since March 2012 (which has partially resolved). She says that she also has varicose veins and dental problems.
She says that she is receiving treatment and is on a rehabilitation programme for each of the injuries, the cost of which is approximately $275 per fortnight, being $75 for a fortnightly physiotherapy session and up to $200 for a fortnightly consultation with a sports physician. Additionally, she says that she spends about $60 per month on medication.
She says that she is also having thyroid issues for which she has been seeing her treating doctor for over 8 months.
Rebecca accepted that her physical disabilities do not prevent her from obtaining, or continuing, employment.
Mica asserts that she has a "back problem" for which she has had several operations in the past.
(g) the age of the applicant when the application is being considered
Rebecca was born in July 1975. She is currently 38 years of age.
(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
There were no contributions by Rebecca to the building up of the estate of the deceased. There may have been contribution towards the deceased's welfare, prior to 1992, but I do not regard it as a significant contribution. There was no contribution by her to the welfare of the deceased's family (Mica) at any time.
(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
Ljubica gave evidence of some financial assistance given by the deceased to her and her husband to assist in the bringing up of Rebecca. However, as said, there are no details of the nature or quantum of the assistance provided. I am satisfied that it was minimal and consisted of birthday and Christmas gifts.
There is no suggestion, otherwise, that the deceased made any provision for Rebecca either during his lifetime, or out of his estate.
(j) any evidence of the testamentary intentions of the deceased person, including evidence of statements made by the deceased person
There is no evidence of any will, or informal testamentary instrument, made by the deceased. Mica gives evidence that he said to her, on more than one occasion, both before and after he found out that Rebecca was his daughter, that "everything I have will go to you".
Ljubica gives evidence that the deceased said that he would provide for Rebecca on his death.
(k) whether the applicant was being maintained, either wholly or partly, by the deceased person before the deceased person's death and, if the court considers it relevant, the extent to which and the basis on which the deceased person did so
The deceased did not maintain Rebecca, either wholly or partly, before his death.
(l) whether any other person is liable to support the applicant
There is no other person liable to support Rebecca.
(m) the character and conduct of the applicant before and after the date of the death of the deceased person
In Delacour v Waddington (1953) 89 CLR 117, at 127 it was observed, in relation to a similar section in earlier legislation, that "the 'character or conduct' must be taken to refer to character or conduct of such a nature as to entitle the court to say that the applicant has forfeited or abandoned his or her moral claims on the testator".
There is no such conduct in the present case.
As I have written, Rebecca did not know of her biological relationship with the deceased until about 2012.
(n) the conduct of any other person before and after the date of the death of the deceased person
There is no relevant conduct of any other person in the present case.
(o) any relevant Aboriginal or Torres Strait Islander customary law
This is not relevant.
(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
There are no other matters that I consider relevant.
Determination
Being an "eligible person" is a necessary precondition to the Court being empowered to make an order for the maintenance, education or advancement in life of the eligible person. In this case, there is no dispute that Rebecca, as a child of the deceased, is an eligible person within the meaning of s 57(1)(c) of the Act.
There is also no dispute that Rebecca commenced her proceedings within the time prescribed by the Act.
Having established eligibility and that the proceedings were commenced within time, the first question for determination is whether, at the time the Court is considering the application, adequate provision for the proper maintenance or advancement in life, of Rebecca has not been made by the operation of the intestacy rules in relation to the estate of the deceased.
I do not find Rebecca's claim on the bounty of the deceased to be a very strong one. I consider that she exaggerated the closeness of her relationship with the deceased. Her relationship was consistent with the deceased being friends of Ljubica and Dimitrije and with the children. I consider that Rebecca did not have as much to do with the deceased as she asserted. She accepted that she did not have anything to do with him, at all, between at least 1992 and 2011 or early 2012. Even then, she only saw the deceased on one or two occasions.
Having considered the matters I am required to consider, I am satisfied that the deceased did not make adequate provision for the proper maintenance and advancement in life of Rebecca as a result of the operation of the intestacy rules. No provision is made for her in the events that have happened. I bear in mind that she was the deceased's only child and that, albeit in the last year of the deceased's life, she did demonstrate a concern to confirm what she had suspected.
In coming to this conclusion, I also have taken into account Mica's legitimate claims upon the bounty of the deceased, as his wife, and the obligation and responsibility that the deceased felt to provide for her. I have noted, however, that she received some provision from the deceased during his lifetime (being the Nerang property that was sold in 2013).
I have also taken into account that the Lightning Ridge property is non-income producing and has been for the last 3 or 4 years.
It is also clear that Rebecca has some "needs". As stated above, "need" in the context of the Act is not determined by reference only to minimum standards of subsistence. Nor is it limited to whether the applicant has, at the date of hearing, an immediate need for financial assistance with respect to her maintenance. It is a broader concept, which requires consideration of matters necessary to guard against unforeseen contingencies.
Turning then to s 59(2), namely the question what provision "ought to be made for the maintenance, education or advancement in life" of Rebecca, having regard to the facts known to the Court. The order for provision should be no more than is necessary to make adequate provision for Rebecca's proper maintenance and advancement in life. I must take into account, and give weight to, the obligation owed to Mica as his wife and the rules of intestacy that provide, because of the size of the estate, that the deceased's whole estate passes to her.
Counsel for Rebecca submitted that she should receive a lump sum of $100,000. I do not accept this submission, which fails to consider the significant, and very much greater, competing claim of Mica. If made, Rebecca would receive virtually the whole of the net estate.
Counsel for Mica submitted that Rebecca's proceeding should be dismissed, or if it was not, a lump sum of $15,000 should be the amount of provision ordered. I do not accept this submission either, as it fails to consider the obligation owed to a child by a parent, and the provision made for Mica during the lifetime of the deceased and as a result of the rules of intestacy.
In my view, Rebecca should receive a lump sum that will enable her to pay her debts and provide a small nest egg for exigencies of life. It might also provide a small supplement of income. In my view, the lump sum should be $32,000. That amount will leave slightly more than $110,000 for Mica. If she decides to sell the Lightning Ridge property, it may enable her to apply for social security assistance.
In coming to this view, I have taken account of the fact that the Lightning Ridge property is no longer Mica's matrimonial home as she now lives in Nerang, Queensland; that she only uses it when she visits Lightning Ridge; and that it has not been income producing for some years. In my view, the sale of the Lightning Ridge property will not impact significantly upon Mica and, even after meeting the lump sum by way of provision for Rebecca, will provide her with cash and an income. Alternatively, if she retains it, it may be rented, thereby providing an income.
The lump sum should be paid within 42 days of the making of the orders or such other time as the parties agree; and, if not so paid, interest at the rate prescribed by s 84A(3) of the Probate and Administration Act, calculated from 42 days from the date of the making of orders until the date of payment, should be paid.
In relation to costs, neither party submitted that a costs order in Rebecca's favour should not be made. The amount claimed as the ordinary costs of Rebecca seem, in all the circumstances, reasonable, and I would be prepared to make a lump sum order, for that amount, unless I am requested not to.
Mica's costs, calculated on the indemnity basis, should be paid out of the deceased's estate or notional estate as well.
In order to give the parties an opportunity to consider these reasons, and to enable Mica to decide the manner in which she will satisfy the order for provision and costs, I direct the parties, within 14 days, to provide Short Minutes of Order, reflecting these reasons. If I receive an agreed document, I shall make the orders in Chambers. I stand the matter over to a date 21 days from the date of delivering these reasons.
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Decision last updated: 05 March 2014
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