Gardiner v Gardiner
[2012] NSWSC 269
•16 March 2012
Supreme Court
New South Wales
Medium Neutral Citation: Gardiner v Gardiner [2012] NSWSC 269 Hearing dates: 14/03/12, 15/03/12 Decision date: 16 March 2012 Jurisdiction: Equity Division Before: Associate Justice Macready Decision: Parties to bring in short minutes.
Catchwords: ESTATE - Succession Act 2006 - application for family provision order by son of the deceased - claim for additional provision - plaintiff's medical condition a serious concern - additional provision held in trust Legislation Cited: Family Provision Act 1982
Mental Health Act 2007
Succession Act 2006Cases Cited: Dalton v Paull (No 2) (2007) NSWSC 803
Singer v Berghouse (1944) 181 CLR 201Category: Principal judgment Parties: Linton Gardiner v Matthew Gavin Gardiner Representation: Ms S Hill for plaintiff
Mr A Lakeman for defendant
Geoff Osborne and Associates for plaintiff
Taperell Rutledge for defendant
File Number(s): 2011/136886
Judgment
HIS HONOUR: This is the hearing of an application under the Succession Act 2006 in respect of the estate of the late Peter Beresford Gardiner who died on 1 May 2010. The deceased was survived by his two children who are the plaintiff and the defendant in the proceedings. He is also survived by his former wife who has been given notice of the proceedings and makes no claim.
LAST WILL OF DECEASED
The last Will was made on 23 March 2010 and appointed the defendant Matthew as executor. The deceased gave legacies of $10,000 to a friend Richard Dunn and $100,000 to his son Linton, the plaintiff. The residue was to be shared equally between his two sons.
This Will was made with the advice from the solicitor and the deceased knew of his imminent death. The additional provision of $100,000 in favour of his son Linton was made at his son's request.
ASSETS IN THE ESTATE
The main asset of the deceased is the deceased's home at Frenchs Forest which the parties agreed has a value of $775,000. The other assets are the proceeds of the sale of AMP shares, $4,643, bank account $1,474, loan from Matthew Gardiner $7,297, car $1,000. Total $14,414.
The deceased's liabilities, including bank loan amount, $139,523. They will necessitate the house being sold. The likely selling expenses will be $14,328.
The motor vehicle has already been transferred to the plaintiff. Disregarding this, the net estate before costs will be $634,563. Deducting the legacy of $10,000, $624,563. The defendant's costs are estimated at $71,857; plaintiff's $53,200. This leaves an estate, if an order is made in the favour of the plaintiff and an order for his costs, of $499,506.
If this is distributed in accordance with the Will the following will occur: Linton will receive $299,753 and Matthew $199,753.
If the costs of these proceedings had not been incurred then each party would have received a further $60,000.
FAMILY HISTORY
The deceased was born in October 1933. He married his wife Yvonne Forest in November 1961 and they had two children; Matthew born in September 1962 and Linton was born in August 1970.
In 1963 the deceased and his wife and one of the children started living at the Frenchs Forest home in which the deceased still occupied and owned at the date of his death.
In 1980 Matthew, having completed high school, moved out of home.
In 1982 the deceased and his wife, Yvonne Gardiner, separated. Apparently the deceased continued to live in the property and Linton, the youngest son, also continued to live there.
In 1986 Linton completed the Higher School Certificate. He then worked between 1987 and 1994 in an IT position with a company. For reasons which I will come to in a moment, after 1994 he never worked again.
In that period of his life he also did a number of other things. He became involved in theatre productions, particularly organising lighting and sound for those, and did voluntary work in that area which plainly was of interest to him.
In 1994 it is said that Linton was diagnosed with Chronic Fatigue Syndrome with Myalgic Encephalomyelitis. In other words, Fibro myalgia Hypersensitivity. At that stage he was aged 24 when he stopped work.
In November 1995 Matthew married his wife Kerry and they have two children. Madlyn was born in July 1998 and Tiffany was born in July 2000.
In 1995 Linton started to receive a Centrelink Disability Support Pension and apparently this was supported by the advice of a psychiatrist who diagnosed Chronic Fatigue Syndrome.
In 2005 when the deceased had a loan from the bank which was to do some work on the property he also paid off some $10,000 on the plaintiff's credit card debt.
In this year, although it is not of great importance in this matter, Matthew set up a family trust which was used to carry out some business activities.
On 8 June 2006 the deceased wrote a letter to his son Matthew. That is very instructive of the relationship which then resulted between the plaintiff and the deceased.
"Dear Matthew,
As you know Linton has had CFS since 1994, when it was diagnosed by Dr Flecknoe-Brown, who arranged for him to receive the disability pension.
Since his mother had left us years earlier, at age 61, I was the only person to look after him, which I did to the best of my ability. Because of his erratic sleeping patterns I had to spend time calling him each morning, as well as taking care of all his needs. We consulted numerous doctors who offered treatment, but none gave him any relief for either sleep or pain.
As time went on he became more demanding than ever, and when I received the age pension at age 65, it had become a full time job looking after him!
His only mental outlet was the computer and the internet. In recent years he has been researching CFS sufferers in other countries. Most of these people claimed they needed more Codeine and Valium type drugs to help cope better with the condition and recently he has started buying and importing these types of drugs from overseas, as he says doctors in Australia don't consider it a pain condition only a sleeping condition and won't prescribe sufficient pain killers.
Over the years he has blamed me for almost everything - for not calling him enough or not doing jobs he can't do. In fact, I have become a full time carer, and at age 72 I find the criticism and physical demands so stressful now, I can barely function without breaking down and crying!
He claims I am his carer and if I don't meet his demands I am guilty of neglect. In fact in recent months he has got so angry with me he has severely assaulted on at least two occasions, smashed or damaged furniture and threatened suicide if I don't do what he wants!
I am not his carer, I just choose to do it because I am the only one who can, but I have never claimed a carer's benefit from Centrelink, so legally I don't feel responsible for him, as he is a man of 35 years. I only do the best I can (which he says is never enough). Because he is my son I love him in spite of everything!
However I am writing this now to let you know I can't take it any more and I am on the verge of a nervous breakdown and then he won't have me to look after him any more. I hope you and his mother can offer some suggestions to help me and him - it would be greatly appreciated!
With love from dad"
The letter is written in a sensible way. I make this comment because there had been suggestions by the plaintiff that the deceased was an alcoholic. Certainly this does not show up in the letter in the way it is written. It is written by someone in a sensible state of mind and I accept what it contains.
Matthew responded appropriately to his father but in fact nothing changed after this and Linton continued to live at home subject to an incident to which I will refer in due course.
In late 2006 there was a bizarre but frightening incident which occurred when Linton took a Samurai sword off the shelf in the living room and chased his father around the house and eventually around the yard. That resulted in the police being called and Linton was taken to the psychiatric part of the Manly District Hospital. Linton claims it was a reaction to some medication Stilnox, which he was taking. However, there was, at the time of his discharge a diagnosis that the plaintiff was suffering from atypical psychosis schizoid personality disorder and narcotic (Codeine) abuse.
In 2007 Linton developed a lung infection due to dental abscesses and decay, according to him, resulting in surgery. He was admitted to North Shore Hospital for a month or so and he had his lungs drained and eventually recovered from that.
He was back in hospital once again on 22 May 2008 when he had to have five teeth removed.
In 2009 the deceased became frailer. He had two falls; one at the beginning of the year and one at the end, and there was an ACAT assessment in respect of his position. He still, however, continued to live at home after his releases from hospital on these occasions.
In February 2010 the deceased suffered a heart attack and was also diagnosed with cancer and was informed of this diagnosis.
In March 2010 Mr Kennedy, solicitor, received instructions to prepare the deceased's Will, which he did over a period of three visits and a number of consultations. The Will was made, as I said, on 23 March 2010 and the deceased died on 1 May 2010, or shortly thereafter. Probate was granted in July 2010. The summons was commenced within time by filing it on 27 April 2011
ELEGIBILITY
The plaintiff clearly is an eligible person.
In applications under the Family Provision Act 1982 the High Court in Singer v Berghouse (1944) 181 CLR 201 has set out the two stage approach the court must take. These comments are equally applicable to claims under the Succession Act 2006 page 209.
"The first question is, was the provision (if any) made for the applicant 'inadequate for (his or her) proper maintenance, education and advancement in life'? The difference between 'adequate' and 'proper' and the interrelationship which exists between 'adequate provision' and 'proper maintenance' et cetera were explained in Bosch v Perpetual Trustee Co Limited. The determination of the first stage in the two stage process calls for an assessment of whether the provision (if any) made was inadequate or what, in all the circumstances, was the proper level of maintenance etc appropriate for the applicant having regard, amongst other things, to the applicant's financial position, the size and nature of the deceased's estate, the totality of the relationship between the applicant and the deceased, and the relationship between the deceased and other persons who have legitimate claims to his or her bounty.
The determination of the second stage, should it arise, involves similar considerations. Indeed, in the first stage of the process, the court may need to arrive at an assessment of what is the proper level of maintenance and what is adequate provision, in which event, if it becomes necessary to embark upon the second stage of the process, that assessment will largely determine the order which should be made in favour of the applicant. In saying that, we are mindful that there may be some circumstances in which a court could refuse to make an order notwithstanding that the applicant is found to have been left without adequate provision for proper maintenance. Take, for example, a case like Ellis v Leeder where there were no assets from which an order could reasonably be made and making an order could disturb the testator's arrangements to pay creditors".
PLAINTIFF'S SITUATION IN LIFE
The plaintiff is 41 years of age, single, no dependants. Because of his illness he has no friends, except perhaps one, has almost no social interaction with the outside world. He continues to live in the deceased's house.
His present assets consist of a car, worth $750 to $900, stamp collections, personal effects, various sound equipment and a hydroponic system previously used to grow marijuana. They are of no significant value. He has a credit card and other household debts totalling $13,995.
His income consists of a disability support pension of $1378.60 per month. It has been reduced to this level because he was forced to get a Centrelink loan to pay the electricity bill otherwise the power would have been cut off.
His expenses amount to $1,582 per month. This is without paying his water rates bill which may lead to his water supply being cut off in the near future.
His medical condition is a serious concern. Although the exact condition is in doubt it is clear he suffers from insomnia, muscle pain, can hardly function as an individual. He is emaciated, eating about three meals a week, and has a very low weight. At times he has weighed 38 kilos. He described his symptoms in his affidavit in these terms:
"The main symptoms of my illness have been muscle and joint pain, sore throat, headaches, swollen glands, feeling tired despite having sleep, lower levels of concentration and loss of short term memory. In the early months of the illness my symptoms were very flu-like in character. However, as the illness has progressed I can suffer from post-exertional fatigue which presents itself as a complete lack of mental and physical stamina, extreme muscle and cognitive fatigue, muscle pain and a worsening of my other symptoms. If I over exert myself I often suffer post-exertional malaise, and the time to recover from the exertion, whether it be physical or mental, may be extreme in that it may take me months to recover. My other present symptoms include sleep dysfunction, including unrefreshing sleep, excessive sleep and disturbed sleep rhythms. I also suffer from autonomic nervous system dysfunction, including light headedness on standing, nausea, extreme pallour and breathlessness and exertion.
I also suffer from symptoms related to my nervous and endocrine systems including fluctuating or low body temperature, feelings of feverishness, episodes of sweating, cold extremities, flushing, anxiety and panic attacks, worsening of symptoms when stressed, and marked changes in weight. I also suffer symptoms related to my immune system, including tender lymph glands, recurrent sore throats, general malaise, flu-like feelings, and sensory sensitivities. I also suffer frequently from general muscle weakness, increased sensitivity to light, sounds and touch. I also suffer digestive disturbances and depression."
There is no reason why I should not accept his evidence as to what are the effects of his present problems. There is evidence from his GP, which was given without the GP having agreed to be bound by the code of conduct, that he has suffered from chronic fatigue syndrome since 1994. It seems a specialist Dr Flecknoe-Brown diagnosed this in 1995, as I have mentioned, so the plaintiff could receive his pension.
The concerns about his diagnosis concerns his dependence both on Codeine and Valium.
The only psychiatric assessment available is the result of his admission to the psychiatric section to the Manly District Hospital in December 2006. Dr Ladd, as I have mentioned, was the psychiatrist, and I have already given his diagnosis which was atypical psychosis schizoid personality disorder narcotic (Codeine) abuse.
In the reasons for admission the doctor set out the events of the incident with the Samurai sword which led to his admission. He noted that he:
"Presents with a complex history but no previously psychiatric admissions. He says he describes symptoms consistent with atypical psychosis with somatic delusions involving bodily functions. He claimed to have suffered from fibro myalgia for many years (having seen over 300 doctors and tests showing NAD) and this caused him to have all over body pain, complete inability to sleep in two years and difficulties in mobilising. He had been virtually housebound with his father caring for him. He had been self-medicating with Codeine tablets through the internet".
The follow-up plan was to put Linton on regular antipsychotic medication as this was administered during his month or so in hospital and seemed to be working. However, whether that was quite right or not, and whether he fully recovered, is somewhat doubtful because Linton admits to deceiving the doctor by feigning to have good sleep and progress so he could get out of hospital.
The question is why did this occur? It probably may have occurred because he had been addicted previously.
He admitted that for 18 months prior to this time he had imported Valium obtained on the internet. This was in the period between 2005 and 2006. He imported this because he believed that his illness required greater treatment by Valium than was available to be prescribed in the Australian system.
Fortunately, in one way, the Customs intervened, having detected the imports and by putting his address on a list which apparently would divert all his incoming parcels to Customs the practice was stopped.
He also used Codeine which he also took at greater levels than would normally be prescribed and that involved him and his father going around to chemists and looking for a particular batch of Nurofen. There was one company that produced Nurofen where the capsules contained Codeine at one end and another substance at the other and did not mix them. What he would do is cut them in half and use that as a source of Codeine to self-medicate. Eventually, that company which was producing Nurofen in Britain was closed down and that source stopped.
He also conceded quite openly that he grew marijuana to assist him in coping with his pain. This was also stopped when the police raided his home on 26 June 2006. He was charged and claimed, of course, that the marijuana was only grown for his own personal medical use, and no doubt this was its use. There is no suggestion he was dealing or involved in any other drug activities. As a result of the charges he was ultimately released under section 32 of the Mental Health Act 2007 and was not further dealt with in the criminal justice system.
In June 2007 he was being assessed for the possibility of a community treatment order following his surgery at that stage. Notes made at that time dealt with the impressions of doctors who were considering this question. They noted:
"Complex problems related to chronic physical symptoms: Fibro myalgia, query chronic fatigue syndrome, over use of pain killers and benzodiazepines, social isolation and loss of function. No evidence of active psychotic illness at present. No evidence of significant mood disorder".
After his father's death he was treated for anxiety and depression but this does not seem to have helped to lift him from his present low level of functioning.
I think he was probably addicted to Valium and Codeine at times due to his own self-medication.
On one level it matters not what is his present diagnosis. Whether it is chronic fatigue syndrome or drug dependency, there seems to be no chance of any improvement. In the future he will never work.
Given his past history of dependency the provision of any further funds to him should take into account that the funds may not be used for the purposes intended. In particular it is notable that in his life he has never had to manage any substantial funds or assets.
So far as his relationship with his father is concerned, police records show the police being called to the home on about nine occasions after 2006 to deal with arguments between the deceased and the plaintiff.
The psychotic episode in late 2006 would have been terrifying for the deceased.
The plaintiff suggested that the deceased was an alcoholic and this made him agitated which contributed to the problems. There is no corroboration of this claim. As I have pointed out the letter from the deceased to Matthew shows no obvious signs of intoxication by the author.
It was an unhappy relationship for the last year of the deceased's life. They still continued to live together. The deceased made provision for the plaintiff in his Will. In these circumstances I do not think that I should reduce the plaintiff's claim on the deceased's bounty because of the decline in the relationship. It was an unfortunate matter which occurred. Precisely how much each contributed to it is difficult to determine on the evidence and I make no further findings.
DEFENDANT'S SITUATION IN LIFE
Matthew is married with two children aged 11 and 13. He works as an IT consultant and runs a home business. His wife does not work as a result of a workplace accident.
Matthew and his wife do not own the home as they lost theirs in a business venture which failed about 2006.
They own two cars worth in total $13,000 and a time share holiday entitlement of $16,000 plus personal possessions.
Matthew and his trust have debts of $51,787 and he owes the estate $7,297.
His net income from employment is $6297 per month. He is an IT manager for Best and Less. He also runs from home an IT consulting and supply business. The income from that is mainly channelled through his family trust where he can offset losses from his failed business ventures, so it is income he receives tax free. The business had a net profit of $6666 for the year ended 30 June 2011; $27,891 for year ended 30 June 2010.
Matthew is in good health. He had a good relationship with his father. Like Linton, he did not contribute to the estate of the deceased.
DISCUSSION
It is necessary to see how the plaintiff says he has been left without adequate and proper provision for his maintenance, education and advancement in life. In this regard he asks for a total legacy of $450,000 to cover:
(a) cost of a house purchased between $300,000 to $400,000,
(b) $63,100 for dental work,
(c) $13,995 to pay his debts,
(d) contingency funds.
In submissions it was said that Linton's biggest priority is a place to live. Given the diminished value of the estate purchasing a townhouse in the area of Frenchs Forest is not feasible and he realises he has to move out of Sydney. He would wish to get some accommodation in an area like Woy Woy and then find someone willing to act as a carer in return for free accommodation. This will save him having to pay commercial carer costs, which are quite high, although he may need some. The evidence shows the cost of a three bedroom house in Woy Woy is $299,000 to $395,000.
The alternative is purchasing a smaller apartment in Woy Woy, perhaps between $279,000 and $330,000. Though this will mean he will need a carer to attend for a couple of hours a day.
Allowing two hours a day, seven days a week for ten years, the lump sum discount rate of 5 per cent is between $232,875.60. His concerns for a carer is real as he needs assistance at home, particularly when he passes out and needs to be picked up and recovered.
The first alternative, in a sense, is a sensible approach to limit the funds because there are limited funds available to the estate.
The dental work results from damage to his teeth, either from excessive use of Codeine or from previous infections. The quote includes three crowns for $4,500; nine implants costing in total $54,000.
The plaintiff needs some work but there would be fair cheaper options, such as using dentures, rather than implants. He has not put before the court alternative costings. I do accept something is appropriate in this regard for his health.
Given his low income he can not afford to carry debts and it is important that they be repaid.
Any sale of the house requires Linton to be relocated pending purchase by him of a house. His brother has offered to fund his accommodation during this process and store his goods on the basis he is repaid after he receives his share of the estate. 18 weeks temporary access will cost $11,088 and storage charges of $1,200 for four months.
The plaintiff's dire circumstances and needs have to be seen in the light of the available funds in the estate and the situation of his brother Matthew.
Although he has a successful career Matthew has a young family and a wife who cannot work. He needs to discharge his and the trust's debts of $51,787 and the debt of estate of $7,297. He also needs a new car for work. Given his location and the age of his present car $40,000 this would not be an unreasonable amount.
He presently rents, having lost his home, and it is not unnatural that he should expect to receive a sum for a deposit on a home for his family to start afresh in life. This is all the more so when his brother is asking for, and probably being provided with, funds to allow him to have a debt free house.
There is, as occurs in so many cases, simply not enough money to go around. Some further provision for Linton is warranted to allow his debts to be paid, some minor dental work, and a purchase of a two-bedroom house at the lower end of the scale.
In my view, he should receive an additional $80,000 which will reduce Matthew's share to about $120,000. Linton's proposal would not even allow Matthew to repay his debts.
However, given Linton's past history of drug abuse, his lack of family and, indeed, importantly Matthew's future needs, I think this additional provision should be held in trust to apply towards the purchase of Linton's property. The trust could own a passive share in the property as tenant in common with the plaintiff in a proportion reflecting each owner's contribution. Linton would have to meet all expenses of running the property, insuring it and keeping it in good repair.
On termination of the trust the interest in remainder will be held for Matthew, failing him his wife and in further default for Matthew's issue.
The events of termination will be the earlier of the following:
(a) the death of Linton;
(b) failure of the plaintiff to purchase a property within 12 months;
(c) if the property is sold, failure to purchase another replacement property within 12 months.
So far as costs are concerned the defendant's costs can be paid out the estate on indemnity basis.
So far as the plaintiff's costs of $53,200 is concerned, the plaintiff has only achieved about $20,000 more than if he took no action. In these circumstances there may be a good case for capping the costs; see Dalton v Paull (No 2) (2007) NSWSC 803 and cases referred to therein.
I realise that this conclusion is based on the estate allowing for full plaintiff's costs so some adjustment may be necessary.
I direct the parties to bring in short minutes to reflect these reasons and to argue the question of the plaintiff's costs.
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Decision last updated: 22 March 2012
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