Estate of David Patrick Roche Frost

[2025] NSWSC 994

Supreme Court

New South Wales

Medium Neutral Citation:

Estate of David Patrick Roche Frost [2025] NSWSC 994

Hearing dates:

In Chambers

Date of orders:

1 September 2025

Decision date:

01 September 2025

Jurisdiction:

Equity - Probate List

Before:

Slattery J

Decision:

Order the respondent to transfer the shares in the private company to the beneficiary, if the transfer has not already occurred. Motion is otherwise dismissed. Make no order as to costs to the intent that each party with bear his and her costs of the motion.

Catchwords:

SUCCESSION — Executors and administrators — Proceedings against executors and administrators — beneficiary of a life estate represented by a tutor – beneficiary of the life estate brings a motion for the passing of estate accounts — the executor has since consented to orders for the passing of accounts — whether the proceedings were necessary – contest about costs.

Legislation Cited:

Probate and Administration Act 1898, s 92

Succession Act 2006, s 93

Supreme Court Rules 1970, Pt 78, r 84

Uniform Civil Procedure Rules 2005, r 42.25.

Cases Cited:

Australian Securities and Investments Commission v Letten (No 17) (2011) 286 ALR 346; (2011) 87 ACSR 155; [2011] FCA 1420

Estate of Nelly Mary Aston; the Estate of Riley Davis Aston [2024] NSWSC 1346

Gatsios Holdings Pty Ltd v Kritharas Holdings Pty Ltd(in liq) (2002) ATPR 41-864

Gatt v Vella [2024] NSWSC 1009

Nolan v Collie (2003) 7 VR 287; [2003] VCA 39

Re Beddoe [1893] 1 Ch 547

Waterhouse v Waterhouse (1998) 46 NSWLR 493

Texts Cited:

G E Dal Pont, “Law of Executors and Administrators”, Lexis Nexis 2022

Category:

Procedural rulings

Parties:

Applicant: Michael Edward Carmody (as Tutor for Cheryl Lee Carmody)
Respondent: Mark Dominique Frost

Representation:

Counsel:
Applicant: S Burchett
Respondent: T Fishburn

Solicitors:
Applicant: Reid Law
Respondent: Stephen Wawn & Associates

File Number(s):

2021/320721

Publication restriction:

Nil

JUDGMENT

1. The only remaining issue in these probate list proceedings is one of legal costs in a contest about a small estate, which has otherwise been almost fully administered and distributed to the applicant.

2. The applicant, Cheryl Lee Carmody, was the de facto partner of David Patrick Roche Frost late of Bondi Junction (“the deceased”), who died in 2021. The respondent, the executor of the deceased’s estate, Mark Dominique Frost, (“the executor”) is the brother of the deceased.

3. By her motion filed on 18 October 2024, the applicant sought orders that the executor verify, file and pass estate accounts and that the executor personally pay the applicant’s costs of bringing the motion on an indemnity basis. The applicant is under a legal disability, so her father, Mr Michael Edward Carmody (Mr Carmody) brought the application on her behalf as her tutor.

4. The contest about the filing and passing of accounts was resolved reasonably soon after the filing of the motion. On 12 November 2024 orders were made for the executor to file and serve an affidavit verifying the accounts, leaving only the issue of the costs of the motion and some other issues being raised by the applicant which were not the subject of prayers for relief in the motion.

5. The parties’ legal representatives made oral submissions in the Probate List on 4 April 2025, when the Court reserved the matter for further consideration in chambers, as it was contemplated that the Court might request further evidence and submissions of from the parties. Mr S Burchett of counsel appeared for the applicant, instructed by Reid Law. Ms T Fishburn of counsel appeared for the respondent, instructed by Stephen Wawn & Associates.

6. After consideration of the matter in chambers, the Court has decided to dismiss the motion with no order as to costs, for the reasons set out in this judgment.

Background to the Applicant’s Motion

7. The deceased died on 14 October 2021. At the time of his death, he was a resident in an aged care facility. He made his last will on 18 September 2017. The executor caused a notice of intended application for probate to be published on 11 November 2021. Probate of his will was granted on 17 March 2022. At the time of filing the application, the estate had a gross value of $415,993 and a net value of $344,278, estate liabilities being $71,715.

8. Following the requirements of Succession Act 2006, s 93, and Probate and Administration Act 1898, s 92, the executor filed a Notice of Intended Distribution on 11 May 2022.

9. The primary assets of the deceased’s estate were an interest in a trust established in the deceased’s father’s estate following a family provision claim, and two classes of shares in a family company the value of which was uncertain.

10. The deceased's will disposed of his entire estate by giving a life interest of the shares to the applicant with the remainder to the executor. The will made a residuary gift of the balance of the estate to the applicant.

11. The deceased and the applicant lived together in an apartment property in the eastern Sydney suburb of Bondi Junction. The apartment is owned by a company of which the executor is the sole director. The deceased and the applicant received a right to reside in the apartment under the deceased’s mother’s will.

12. The deceased’s mother, Diana Frost, had died in 2007. Her will provided that if the deceased predeceased the applicant, the applicant could remain living in the apartment during her lifetime with all the outgoings of the apartment to be borne by the deceased’s mother’s estate.

13. The deceased mother’s will also provided for the making of weekly maintenance payments to the deceased and then to the applicant after his death. With some disagreement about the timeliness of these payments, they have been made since the deceased’s death and are not the subject of current complaint. Importantly though, these payments are made to the applicant, not from the deceased’s estate but from the deceased mother’s estate.

14. On or about 19 September 2024, the sum of $373,560.68 was transferred to the applicant in accordance with the applicant’s instructions. This sum was largely derived from a family provision settlement obtained by the deceased from the estate of his late father and represented what the executor believed to be a full distribution of the deceased’s estate.

15. Despite this distribution the applicant still had questions of the executor about the property within the deceased’s estate, its value, and whether the full estate had been distributed to her in accordance with the deceased’s will. So, the applicant filed a motion on 18 October 2024.

16. This background does not summarise the detail of the administration of the estate between the death of the deceased and the filing of the motion. Sufficient relevant detail appears from the Court’s consideration below of the submissions put by the parties.

The Notice of Motion

17. The motion claimed two prayers for relief. The first prayer for relief sought the verification, filing and passing of accounts of the deceased’s estate. The second prayer for relief sought that the respondent pay personally the applicant’s cost of the motion on the indemnity basis.

18. On the first return date before the Registrar in Probate, on 12 November 2024, the executor consented to the first prayer for relief for the verifying, filing, and passing of the estate accounts. But the executor opposed any order being sought for him to pay the applicant indemnity costs of the motion without recourse to the estate.

19. An affidavit of accounts dated 31 January 2025 was filed by the executor on 12 February 2025 in conformity with prayer for relief 1.

20. The matter first came before the Probate List judge on 25 February 2025. Orders were made that day for the executor to respond to various outstanding requests for information which the applicant had made. The Court encouraged the executor to provide as full an answer as possible to avoid the matter being adjourned on 4 April so the estate could be finalised.

21. The requests that the applicant had been making included the following: requests for information about the transfer of the shares in the family company, DiFrost Pty Ltd, to which the applicant is entitled, an explanation of the deceased’s life insurance current at the time of his death, an account of the investment of estate funds, and details of any tax returns filed on behalf of the estate or any estate financial statements.

22. At the time of the hearing on 4 April 2025, the applicant was claiming that insufficient information had been provided to her about the shares or the life insurance. The other request in relation to the investment of estate funds had by then been the subject of a response on 4 March 2025 and it had also been confirmed on the same date that no estate tax returns had been filed.

Applicable Legal Principles.

23. In substance, the issues for determination in the proceedings relate to whether the conduct of the executor warrants him being required to indemnify the estate for the plaintiff’s legal costs.

24. The usual rule as to costs in probate litigation is that costs are in the discretion of the court and generally follow the event: Estate of Nelly Mary Aston; the Estate of Riley Davis Aston [2024] NSWSC 1346 at [109]. But an applicant’s successful application for the passing of accounts does not automatically warrant a costs order in the applicant’s favour against the executor. Such an application is not premised on an allegation or proof of a breach of duty by the executor. Rather it derives entirely from the respective positions of and relationships between the estate’s representatives and the beneficiaries, so an order for costs is not ordinarily appropriate: G E Dal Pont, “Law of Executors and Administrators”, Lexis Nexis 2022, at 12.42.

25. The trustee’s duty to keep proper accounts is fundamental and is a necessary incident of the control of trust property by the trustee and where a beneficiary seeks accounts for information from a trustee the trustee is entitled to be reimbursed by the beneficiary in advance for the cost of supplying the accounts all the information: Waterhouse v Waterhouse (1998) 46 NSWLR 493 and Gatt v Vella [2024] NSWSC 1009 at [48].

26. A negative test has long been said to be the applicable test to determine whether a trustee executor should be indemnified out of trust or estate assets. That test is said to allow indemnification for expenses that have not been shown to have been unreasonably or improperly incurred, a formulation which can be traced back at least to the judgment of Lindley LJ in Re Beddoe [1893] 1 Ch 547. This formulation and its practical application have attracted some judicial criticism and discussion: see for example Gatsios Holdings Pty Ltd v Kritharas Holdings Pty Ltd (in liq) (2002) ATPR 41-864 and Nolan v Collie (2003) 7 VR 287; [2003] VCA 39 and Australian Securities and Investments Commission v Letten (No 17) (2011) 286 ALR 346; (2011) 87 ACSR 155; [2011] FCA 1420 (“Letten”) at [14] – [18]. A similar standard is set by Uniform Civil Procedure Rules, r 42.25.

Consideration

27. The final matters at issue between the parties fell into three categories: (1) allegations of lack of the provision of information, (2) alleged delay, and (3) the proper disposition of costs. One matter should be excluded at the outset from all these categories of issues. Several of the applicant’s requests for information related to transactions involving the estate of the deceased’s mother, Diana Frost. These were irrelevant to the current issues concerning the administration of the deceased’s estate.

28. (1) Provision of Information. The applicant criticised the executor for not providing information that she had requested, principally information concerning the D and H class shares in the family company, DiFrost Pty Ltd, gifted to her under the will and information in relation to an alleged life insurance policy held by the deceased.

29. Neither of these requests for information were the subject of prayers for relief in the motion. When the matter came before the Court on 25 February 2025 the Court made orders for these issues to be addressed, so that the remaining issues between the parties could be resolved without further formality. This seems largely to have been done in the manner intended by the Court. The Court intervened of its own motion about these requests for information to avoid further formality and costs. This intervention by the Court was outside the prayers for relief in the motion and would not necessarily lead to costs orders being made on the motion.

30. Ms Fishburn of counsel on behalf of the executor indicated to the Court on 4 April that the D and H classes of shares in DiFrost Pty Ltd would shortly be transferred into the applicant’s name for her lifetime. This was a practical solution to a debate which had been ongoing on for some time about the value of these classes of shares. The decision to transfer them avoided that debate. The applicant appeared satisfied by this commitment and this issue was not further pressed in argument, although the Court has not yet been informed that this transfer has occurred. This is best dealt with on the basis that orders should now be made for this share transfer to occur and if the transfer has already taken place there will be no further need to comply with the order.

31. The issue of the life insurance arose from certain expense entries appearing in the deceased’s bank statements with the accompanying description “Payment by authority to Westpac Life Ins”. Mr Burchett on behalf the applicant submitted that these charges indicated that the deceased must have held a life insurance policy, which the applicant had not been made aware of during the deceased’s lifetime, and which had not previously been disclosed during the administration of the estate. Mr Burchett further submitted that since the deceased’s death the executor had not given the applicant the proceeds of any life insurance policies to which she would have been entitled, nor identified the life insurance policies for the benefit of the applicant and explained why the policies had not responded. He submitted that the lack of information from the executor required an explanation, given the payments recorded in the bank statements.

32. Ms Fishburn submitted in reply on behalf of the executor that the life insurance policies for which these payments were made were both only accidental death policies, not life insurance policies but they had been issued by a life insurer and so the payments were recorded in the bank statements in the form that they were.

33. Mr Burchett submitted on behalf of the applicant that even if these were accidental death policies the cause of the deceased’s death might nevertheless be classified as being “accidental” and the policies might therefore respond.

34. This seems unlikely in the circumstances. The typical wording of policy insuring for accidental death describes an accident in terms of a sudden and unexpected but identifiable event. And the death must then usually occur within a specified subsequent timeframe. The deceased’s death certificate lists various causes of the deceased’s death as follows:

“(I) Aspiration pneumonia, 2 weeks

(b) Vascular dementia, several years

(c) Chronic obstructive pulmonary disease, years

(II) Diabetes mellitus, several years.”

35. Mr Burchett submitted that the deceased’s death certificate stated that one of the immediate causes the deceased’s death was “aspirational pneumonia” and that the definition of “aspirational pneumonia” refers to the accidental inhalation of material which causes a response in the lungs. Mr Burchett submitted that the applicant wished to see the policy itself to be satisfied that the insurer did not have to be questioned as to whether the policy responded.

36. But evidence that the deceased had been in residential aged care for some time suffering from dementia and other comorbidities and was quite unwell, makes it unlikely that his death was unexpected in a sense that would ordinarily allow an accidental death policy to respond. Nor is it clear from the death certificate that a single event may have led to the deceased’s death. On the face of the available evidence, an accidental death policy is unlikely to respond to the known circumstances of the deceased’s death.

37. Mr Burchett submitted that the applicant knew little more than this as a basis for seeking a copy of this insurance policy. Prior to the hearing the applicant had been requesting the respondent issue a subpoena to Westpac for the policy. But the facts presently available to the Court do not objectively warrant the Court itself authorising further investigation of the terms of any accidental death policy and whether it responded to the deceased’s death, because the improbability is high of such a policy responding.

38. It is not reasonable to expect the executor to expend further estate resources in investigating the prospect that such a policy might benefit the estate, unless the applicant offers to indemnify the executor for the costs of obtaining, copying and providing the insurance policy to the applicant and making any such further investigations that the applicant may require on behalf of the estate. The applicant has a financial interest in investigating this matter, if she wishes to do so. And the insurer will probably only deal with the executor, as the legal personal representative of the life insured. But if the applicant wishes to take this matter further, in the face of the information obtained so far, she will have to undertake to indemnify the executor for such further work on his part, as the estate has now otherwise been fully distributed.

39. The applicant is not without financial resources to take this course, as she is in receipt of a regular weekly payments from the estate of Diana Frost. The Court will give liberty to apply to allow this to be pursued but the applicant cannot expect to obtain any orders without offering a satisfactory indemnity to the executor.

40. The Court will otherwise order that the matter be referred to the Registrar to certify the filing of accounts pursuant to Supreme Court Rules 1970, Pt 78, r 84.

41. (2) Alleged Delay. There has been delay in the administration of the deceased’s estate. But allocating responsibility for it is not simple. The applicant herself did not respond to many letters addressed to her in the first 12 months after the deceased’s death. Then the executor sought to have Mr Carmody verify his status as the applicant’s attorney and the person with whom the executor should correspond. This finally occurred in March 2024. Then between early 2024 and the filing of the motion the parties were generally engaged in correspondence about the provision of information. At times the executor was slow to respond. But one encouraging feature of the correspondence in this case is it has generally been courteous and informative. Moreover, the executor was generally attentive over the long-term to the applicant’s enquires about the estate and the estate accounts. The executor was slower to respond to requests for information under his previous solicitors, than his present solicitors.

42. Some overall delay was due to the executor’s management of the estate, but the effect of such delay has now been cured. Any such delay was not so unreasonable or the result of improper conduct, that it would ordinarily warrant depriving the executor of his right of indemnity from the estate, let alone paying the costs of the applicant for bringing the present motion.

43. (3) Costs. The primary remaining issue which the parties now seek to have resolved is the appropriate order for the costs of the motion. Although the applicant sought indemnity costs on the motion, she no longer pressed for that relief in her submissions and instead seeks costs on a party-party basis.

44. The executor offered to pay his own costs of the motion as the appropriate outcome of this contest. The executor pointed out that he has already personally funded the costs of this litigation, because there is nothing left in the estate. He says that from filing the notice of Motion up to and including 25 February 2025 he has incurred $14,536.25 in costs. Thereafter he incurred professional costs of $7,136.97 up to 2 April 2025. Indeed, he says he also incurred legal costs of $7,742.90 between January and October 2024. In effect he is offering to give up his right of indemnity out of the estate. The executor is taking a practical position, because the estate was distributed before many of these costs were incurred and to claim an indemnity from the estate he would have to seek to recover money from the applicant.

35. An order for the filing of accounts does not of itself automatically warrant a costs order against executor. The applicant’s requests for information were typical issues raised by beneficiaries in the administration of estates. But the executor mostly responded to these requests over time, and it was the Court’s intervention in February 2025, rather than the motion that finally brought these requests to a conclusion.

36. The executor submitted, and the Court accepts, that his conduct before and after the filing of the motion has been reasonable. The conduct of the executor before the Court has likewise demonstrated efficient focus on the real issues in dispute.

37. The appropriate order to be made in these circumstances is that now offered by the executor, that each party bear his and her own costs of the motion and the Court will so order.

Orders

48. For these reasons, the Court:

1. NOTES that on 4 April 2025, the respondent noted that the Class D and Class H shares in DiFrost Pty Ltd would be transferred to the applicant.

2. ORDERS that the shares referred to in NOTE (1) be transferred to the applicant within 21 days, if they have not already been transferred.

3. REFERS the matter to the Registrar to certify the passing of accounts under Supreme Court Rules 1970, Pt 78 r 84.

4. DISMISSES the applicant’s motion filed on 18 October 2024.

5. NOTES the Court makes no order as to costs to the intent that each party will bear his and her own costs of the applicant’s motion filed on 18 October 2024.

6. GRANTS liberty to the parties to relist the proceedings in the week commencing 20 October 2025 before Slattery J, in relation to any remaining issue of obtaining insurance policy, if and only if notice of such listing is given to the Chambers of Slattery J by Monday, 21 September 2025.

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Decision last updated: 01 September 2025