Gash v Ruzicka

SUPREME COURT OF VICTORIA

COURT OF APPEAL

S EAPCI 2022 0036

ELLEN GASH	Applicant
v
EVA RUZICKA (WHO IS SUED AS THE EXECUTOR OF THE ESTATE OF THE LATE MILAN JANSON, DECEASED)	Respondent

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JUDGES:	KENNEDY, WALKER JJA and J FORREST AJA
WHERE HELD:	Melbourne
DATE OF HEARING:	14 July 2023
DATE OF JUDGMENT:	17 August 2023
MEDIUM NEUTRAL CITATION:	[2023] VSCA 189
JUDGMENT APPEALED FROM:	[2022] VSC 139 (McMillan J)

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WILLS AND ESTATES – Where deceased bequeathed 1 out of 100 parts of estate to adult daughter – Where father’s will stated that daughter’s share should be limited given longstanding lack of contact – Where adult daughter had limited financial means – No dispute that provision for adult daughter failed to satisfy deceased’s moral duty – Trial judge ordered applicant be paid 10 additional parts – Where trial judge found that applicant could rent elsewhere more cheaply – Where no evidence about costs of alternative accommodation – Leave to appeal granted – Appeal allowed – Discretion re‑exercised so daughter paid 15 additional parts.

Administration and Probate Act 1958, ss 90, 91, 90A applied.

House v The King (1936) 55 CLR 499; Collicoat v McMillan [1999] 3 VR 803; Walsh v Walsh [2013] NSWSC 1065 applied.

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Counsel
Applicant:		Ms CH Sparke KC
Respondent:		Ms M Rozner
Solicitors
Applicant:	Sanicki Lawyers
Respondent:	DCM Lawyers

KENNEDY JA
WALKER JA
J FORREST AJA:

Introduction

The applicant, Ellen Gash, commenced a proceeding against the respondent Eva Ruzicka as the executor of the estate of Milan Janson (the ‘deceased’), who died on 7 August 2017. She sought proper maintenance and support from the estate pursuant to pt IV of the Administration and Probate Act 1958 (the ‘Act’). The deceased’s will divided his estate into 100 equal parts, leaving only 1 of the 100 parts to the applicant, who was his (adult) daughter.
The deceased recorded reasons for this disposition in his will. He stated that the applicant had not contacted her dying mother, nor attended her funeral, and that he had not seen the applicant for some 25 years.
On 21 March 2022, a judge of the Trial Division ordered that the applicant be provided with a further 10 parts, having regard to the applicant’s limited financial means.
The applicant seeks leave to appeal the orders dated 21 March 2022.
For the reasons that follow, we will grant leave to appeal, allow the appeal, and make orders that the applicant will be provided with an additional 15 parts.

Background facts

The deceased died in August 2017, and was survived by his adult daughters — the applicant and Vaclava (‘Wendy’) Klempt — as well as his partner, Eva Ruzicka. Ms Ruzicka is the executor of the deceased’s estate, and in that capacity she is the respondent to this proceeding. She is also a beneficiary under his will.
The deceased’s will divides the estate into 100 equal parts, and distributes the estate as follows:
(a)30 parts to the deceased’s brother, Josef Jandovsky. Josef lives in the Czech Republic. The deceased travelled to see him each year from 2008 to 2017.
(b)30 parts to Wendy Klempt. Wendy is a child from a relationship the deceased had in the Czech Republic prior to his migration to Australia. Wendy resumed a relationship with the deceased as an adult, in 2007. She lives in Canada. The respondent met Wendy on four occasions.
(c)14 parts to the respondent. From 2007, the respondent was the primary care giver and loving partner of the deceased. The deceased suffered from a number of serious health issues in the years before his death.
(d)12 parts to the deceased’s niece, Klara Jandovska. Klara lives in the Czech Republic.
(e)7 parts to the deceased’s friend Elena Dolinsky, who helped him with his paperwork, including bills and taxes, and who passed away after the deceased.
(f)6 parts in varying proportions to six other beneficiaries (two of the deceased’s friends, Janka Banda and Marie Simon; two clubs associated with the Czech Republic; and the applicant’s two daughters, Naomi and Nicole).
(g)1 part to the applicant.
The Court was advised at the hearing that the value of the estate is $3.179 million, which will be reduced by executor’s commission (of 2 per cent) and legal costs of the proceeding.
The respondent conceded that the deceased owed a moral duty to the applicant, but contested the quantum of any award.
The deceased made the will in March 2015. As indicated already, the will sets out his reasons for his decision to gift the applicant only 1 part of his estate. Paragraph 3(iv) states that the deceased has provided:
[N]o further benefit whatsoever under this my Will to my daughter Ellen Gash as she has shown no interest in knowing me or her mother, my late wife Eliska Jandovska, during our lifetime. My said daughter has had no contact with my late wife for a period exceeding 17 years till my late wife’s death. I have not seen my said daughter for approximately 25 years now. It has saddened and burdened both my and my late wife’s lives that our said daughter Ellen Gash had not contacted my late wife despite knowing that she was suffering from cancer in 1990 and later again in 1999. After my late wife succumbed to cancer my said daughter did not even telephone nor did she attend the funeral. Because of the great pain she has caused my late wife and myself I believe her not to be deserving of any further financial gain after my death …
There was a dispute on the evidence as to the extent, and cause, of the estrangement between the deceased and the applicant. The matter is complicated by the fact that some of the evidence relating to the estrangement was not admitted into evidence.[1] However, the applicant did not challenge the ultimate finding of the judge that the relationship was ‘very limited to almost non-existent’ and that she and her father led separate lives from at least 1989 onwards.
[1]Only paragraphs 69–80 of Ellen Gash’s affidavit sworn 16 August 2018 and paragraphs 58–59 of Ellen Gash’s affidavit sworn 30 November 2018 were admitted into evidence.
At trial, the applicant’s claim varied considerably, though she ultimately sought an amount of $1.6–$1.9 million, which included an amount of $1.2–$1.5 million for the purchase of a new home, as well as $75,500 for a car and furniture. The respondent however, made an open offer that the applicant be provided with a ‘nest egg’ of 10 per cent of the estate (in addition to the applicant’s existing 1 per cent) and submitted that this was an appropriate amount of provision.
On 21 April 2020, the judge conducted a hearing and delivered reasons on 23 July 2020 (‘Reasons No 1’).[2] She declined to make substantive orders given the applicant had failed to provide adequate evidence of financial need, but gave the applicant an opportunity to file further evidence. The judge then conducted a further hearing on 3 May 2021.
[2]Re Janson; Gash v Ruzicka [2020] VSC 449.
On 21 March 2022, the judge delivered further reasons (‘Reasons No 2’),[3] and ordered that provision be made for the applicant in the amount of 11 out of 100 parts of the net estate, after the deduction of executor’s commission and costs.
[3]Re Janson; Gash v Ruzicka (No 2) [2022] VSC 139.
On appeal, the applicant has again revised her claim. Although she no longer seeks a fund sufficient to purchase a new home, she now seeks an amount of $1.4 million as described further, below.

Statutory framework

Part IV of the Act deals with family provision. Section 90A provides that an ‘eligible person’ may apply to the Court for a family provision order. As an adult child, the applicant falls within para (f) of the definition of an ‘eligible person’ contained in s 90.[4]
[4]Given that the applicant was not a child or step-child under 18 years old, a student, nor a child with a disability: see parts (b), (c) and (f) of the definition of ‘eligible person’ in s 90.
Section 91 relevantly provides that:
(1)Despite anything to the contrary in this Act, on an application under section 90A, the Court may order that provision be made out of the estate of a deceased person for the proper maintenance and support of an eligible person.
(2)The Court must not make a family provision order under subsection (1) unless it is satisfied:
(a) that the person is an eligible person; …
(c)that, at the time of death, the deceased had a moral duty to provide for the eligible person’s proper maintenance and support; and
(d)that the distribution of the deceased’s estate fails to make adequate provision for the proper maintenance and support of the eligible person …
(4)In determining the amount of provision to be made by a family provision order, if any, the Court must take into account—
(a)the degree to which, at the time of death, the deceased had a moral duty to provide for the eligible person; and
(b)the degree to which the distribution of the estate fails to make adequate provision for the proper maintenance and support of the eligible person; and
(c) … the degree to which the eligible person is not capable, by reasonable means, of providing adequately for their proper maintenance and support; …
(5) The amount of provision made by a family provision order—
(a)must not provide for an amount greater than is necessary for the eligible person’s proper maintenance and support …
In addition to s 91(4), s 91A(1) identifies other factors to which the Court must have regard in making a family provision order, namely:
(a) the deceased’s will, if any; and
(b)any evidence of the deceased’s reasons for making the dispositions in the will (if any); and
(c)any other evidence of the deceased’s intentions in relation to providing for the eligible person.
Section 91A(2) of the Act then outlines a number of matters that the Court may also take into account:
(a)any family or other relationship between the deceased and the eligible person, including—
(i)       the nature of the relationship; and
(ii)      if relevant, the length of the relationship;
(b)      any obligations or responsibilities of the deceased to—
(i)       the eligible person; and
(ii)      any other eligible person; and
(iii)     the beneficiaries of the estate;
(c)the size and nature of the estate of the deceased and any charges and liabilities to which the estate is subject;
(d)the financial resources, including earning capacity, and the financial needs at the time of the hearing, and for the foreseeable future of—
(i)       the eligible person; and
(ii)      any other eligible person; and
(iii)     any beneficiary of the estate;
(e)any physical, mental or intellectual disability of any eligible person or any beneficiary of the estate;
(f)      the age of the eligible person;
(g)any contribution (not for adequate consideration) of the eligible person to—
(i)       building up the estate; or
(ii)      the welfare of the deceased or the deceased’s family;
(h)any benefits previously given by the deceased to any eligible person or to any beneficiary;
(i)whether the eligible person was being maintained by the deceased before that deceased’s death either wholly or partly and, if the Court considers it relevant, the extent to which and the basis on which the deceased had done so;
(j)       the liability of any other person to maintain the eligible person;
(k)      the character and conduct of the eligible person or any other person;
(l)the effects a family provision order would have on the amounts received from the deceased’s estate by other beneficiaries;
(m)     any other matter the Court considers relevant.
In considering what is necessary for proper maintenance and support the Court must assume the position of a ‘wise and just’ testator judged by current community standards.[5] However, the Court should not be drawn into rewriting the testator’s will by reference to general considerations of fairness.[6]
[5]Bosch v Perpetual Trustee Co Ltd [1938] AC 463, 478–9; White v Barron (1980) 144 CLR 431, 440–1 (Stephen J), 444–5 (Mason J), 460 (Wilson J); [1980] HCA 14; Davison v Kempson [2018] VSCA 51, [35] (Zammit J).
[6]Worladge v Doddridge (1957) 97 CLR 1, 12 (Williams and Fullagar JJ), 20–1 (Kitto J); [1957] HCA 45.
The parties accepted that the trial judge correctly set out the applicable principles which relevantly included:[7]
In determining whether the deceased has fulfilled his or her moral duty, and the extent of any provision to be ordered, the Court must have regard to the relative concepts of ‘adequate’ and ‘proper’. Adequacy is assessed by reference to the Court’s inherent knowledge and inquiry into current social conditions and standards.[8] In this context, it is necessary that an applicant demonstrate need in order to be successful in his or her claim; mere proof of a moral duty is not in itself adequate.[9] However, an applicant is not required to show that his or her circumstances are destitute and, as such, the need is ‘not restricted to the requirements of basic necessity or sustenance’.[10] …
The general principles to be borne in mind when dealing with claims by adult children are succinctly set out by Hallen J in Walsh v Walsh:[11]
(b)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 …
(c) 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.[12]
[7]Reasons No 2, [53]–[55] (citations in original).
[8]See, eg, Goodman v Windeyer (1980) 144 CLR 490, 501–2 (Gibbs J); [1980] HCA 31; Pontifical Society for the Propagation of the Faith v Scales (1962) 107 CLR 9, 19 (Dixon CJ); [1962] HCA 19. See generally, GE Dal Pont and KF Mackie, Law of Succession, (LexisNexis Australia, 2^nd ed, 2017) 607 [17.86].
[9]MacEwan Shaw v Shaw (2003) 11 VR 95, 104 [50] (Dodds-Streeton J); [2003] VSC 318.
[10]Ball v Newey (1988) 13 NSWLR 489, 492 (Samuels JA, Hope JA agreeing at 490, Mahoney JA agreeing at 493–4).
[11][2013] NSWSC 1065.
[12]Ibid [121] (citations omitted).
Overall, the assessment calls for an instinctive synthesis of the relevant considerations and is not an exercise involving precise mathematical calculations.[13]
[13]Blair v Blair (2004) 10 VR 69, 81–2 [30] (Chernov JA, Nettle JA agreeing at 84 [39], Hansen AJA agreeing 84 [42]); [2004] VSCA 149; Davison v Kempson [2018] VSCA 51, [70]–[71].

Judge’s reasons

Reasons No 1

In Reasons No 1, the judge recorded some of the evidence adduced by the applicant as to her financial needs. In particular, she referred to the fact that the applicant received some income from ‘homestay’ students, as well as Centrelink income and stated:
The plaintiff also deposed that she and her husband currently have two Vietnamese homestay students living with them, through a program run by the Department of Education. The plaintiff and her husband have been a part of that program, on and off, for four or five years. …
The plaintiff deposed that she and her husband cannot rely on the income from homestay students, as the amount they receive changes every year depending on how many homestay students they have staying with them. She stated that students stay for varying periods, ranging from two weeks to a full year. …
The plaintiff acknowledged that the [financial documentation] did not show amounts for utilities bills, groceries and motor vehicle insurance and registration. The plaintiff said that these expenses were paid from income received in cash from homestay students which is kept separate from her bank account.[14]
Reasons No 2
[14]Reasons No 1, [25]–[26], [32].
At the commencement of Reasons No 2, the judge summarised the further evidence the applicant had filed. She recorded that the applicant deposed to the assets and liabilities she and her husband (David Gash) held as follows:[15]
[15]Reasons No 2, [5].
Assets
Plaintiff’s assets                   Bank account (as at 20 April 2020)    $3,214
Husband’s assets                  Bank account (as at 20 April 2020)    $2,319
Motor Vehicle  $2,600
Joint assets  Home contents  $4,000
Cash on hand  $5,520
Liabilities
Joint liability  Loan from daughter  $192,367
(Naomi Bant)
The judge also recorded that the applicant deposed that neither herself nor her husband possessed any superannuation.[16]
[16]Ibid [7].
Her Honour considered that, while the amounts in the bank accounts were substantiated, the other asset amounts were estimates.[17]
[17]Ibid [6].
The judge considered that the total amount of the purported loan that the applicant sought to substantiate from her daughter, Naomi, through documentation was $158,029.27, rather than the amount referred to in her affidavit of $192,367.[18] Much of this loan related to premium payments for a life insurance policy over the life of David Gash.[19] However, Naomi deposed that she was no longer paying these premiums and there was evidence that this policy had lapsed in February 2021.[20] In cross examination, the applicant claimed that she was currently repaying Naomi’s loan in monthly amounts of $200.[21]
[18]Ibid [22].
[19]Ibid [11].
[20]Ibid [23].
[21]Ibid [10].
The applicant also deposed to the existence of a trust she described as ‘Naomi’s Family Trust’, titled the ‘Safehaven trust,’ which became the owner of a life insurance policy in March 2015.[22] The trial judge considered that evidence regarding the ‘Safehaven trust’ (including assets and distributions) had not been provided, in circumstances where the applicant and her husband were identified as primary beneficiaries.[23]
[22]Ibid [24], [28].
[23]Ibid [28].
The applicant’s evidence was that David Gash was diagnosed with multiple sclerosis in 2016 and had been approved for the National Disability Insurance Scheme (‘NDIS’) in November 2019.[24] The applicant exhibited a signed VicRoads medical certificate dated 23 November 2020, which supported the multiple sclerosis diagnosis. The judge observed that no further evidence as to the applicant’s husband’s medical condition had been provided.[25]
[24]Ibid [31], [39].
[25]Ibid [31].
The judge recorded that the applicant received a carer’s allowance and other benefits, while her husband received a disability support pension, with the annual household income from Centrelink being $45,064.60.[26]
[26]Ibid [29]–[30], [68].
The judge also recorded that the applicant deposed to receiving $32,483.46 in income between 1 May 2019 and April 2020 through the homestay program, which service had been provided for approximately four years.[27] The applicant also deposed:
[T]hat this income fluctuates and she is unsure how long she will be able to provide the service in the future, given her husband’s health and the requirement of a three bedroom house in an area close to schools providing the homestay program. In cross examination, the plaintiff claimed that it is her intention to continue to provide homestay and that there are no current medical issues that would prevent her from doing so.[28]
[27]Ibid [32].
[28]Ibid [33].

The judge also recorded that the value of the applicant’s rental expenses was $3,550 per calendar month, being $42,600 per year, in circumstances where the rent had not increased since September 2007.[29] Although the lease expired in 2016, the applicant and her husband currently occupy the premises on a month‑to‑month tenancy, such that their occupation is not secure should the landlord wish to sell.[30]
[29]Ibid [35], [69].
[30]Ibid [35].
The applicant also deposed to other expenses of $34,598 for the period 1 May 2019 to 30 April 2020.[31] The judge considered that, while some of these expenses were substantiated, others appeared to have been substantially higher, not substantiated, or unexplained.[32]
[31]Ibid [36].
[32]Ibid [37], [70].
The judge recorded the applicant’s claimed future needs as follows: [33]
[33]Ibid [42].
Motor vehicle and on road costs                  $32,000
Furniture and household goods                   $43,500
An amount for contingencies  $250,000
Purchase price of a suitable home               $1,200,000–$1,500,000
Stamp duty  $75,000
Removalist costs  $10,000
Total  $1,610,500–$1,910,500
The judge went on to carefully summarise the relevant provisions, applicable principles, and the relevant parts of the deceased’s will, including the reasons the deceased gave for making the disposition of 1 share to the applicant (as required by s 91A(1)).[34] She also recorded that the respondent’s evidence supported the deceased’s sentiments as recorded in his will.[35]
[34]Ibid [47]–[60].
[35]Ibid [60].
The judge next made a number of findings in relation to the matters that may be taken into account under s 91A(2) as follows.

(a) the nature of the relationship, including the length of the relationship

The judge made reference to conflicts in the evidence about the cause and extent of the estrangement between the applicant and the deceased. While the applicant deposed to animosity towards her husband and herself from 1989/1990, the respondent suggested that the applicant cut her parents out of her life after she was refused a loan (having failed to repay an earlier loan).[36] The judge observed that the applicant contended that the relationship was not as remote as recorded in the deceased’s will and as deposed by the deceased’s other family members.[37]
[36]Ibid [61], [63].
[37]Ibid [65].
The judge ultimately found that it was apparent from the applicant’s evidence that the relationship was ‘very limited to almost non‑existent’ and the applicant and the deceased led separate lives with little or no contact with each other from at least 1989 onwards. She considered that the relationship between the applicant and the deceased for most of his life was ‘virtually non‑existent’.[38]

(b) any obligations or responsibilities of the deceased to the eligible person, any other eligible person and the beneficiaries

[38]Ibid [65].

The judge considered that the deceased had a moral obligation to provide for the respondent and each of his daughters, but not the remaining beneficiaries in his will.[39]

(c) the size and nature of the estate

[39]Ibid [66].

The judge recorded the value of the estate at $3,179,462.54, which was to be reduced further by the payment of an executor’s commission, and costs (which were yet to be determined).[40]

(d) the current and future financial resources, earning capacity and financial needs of the eligible person, any other eligible person and any beneficiary

[40]Ibid [67].

The judge recorded the total annual amounts in respect of Centrelink, homestay income and rent, but observed that the applicant’s further evidence failed to substantiate the precise amount of her expenditure.[41] However, she stated:
As the plaintiff and David Gash’s annual expenditure on rent [$42,600] is only slightly less than their income from Centrelink [$45,064.60], it appears they rely on their income from homestay students in order to remain in their current home and to finance some of the other everyday costs of living, such as groceries.[42]
[41]Ibid [68]–[70].
[42]Ibid [71].
The judge further accepted that the applicant and David Gash do not have substantial savings, nor do they have any superannuation.[43] Further, that the applicant’s husband has multiple sclerosis.[44]
[43]Ibid [73].
[44]Ibid [72].
However, the judge identified deficiencies in the evidence about the costs of David Gash’s illness as well as a lack of documentation regarding the ‘Safehaven trust’ assets which left a ‘substantial gap’ in the applicant’s evidence.[45]
[45]Ibid [72]–[73].
In relation to the loan allegedly owed by the applicant to her daughter, the judge stated:
Although the plaintiff asserts a debt owing to Naomi, there is insufficient evidence to factor such an opaque arrangement into the consideration of the plaintiff’s financial need. In reality, the plaintiff and her husband appear to have had the benefit of financial assistance from Naomi over many years and there appears to be no reason why such assistance will not continue.[46]
[46]Ibid [74].
Of the other beneficiaries, the judge noted that only the respondent deposed to having limited means.[47]

(e) any physical, mental or intellectual disability of any eligible person or any beneficiary

[47]Ibid [75].

Although the applicant deposed to ill health in middle age, she did not depose to having any physical, mental or intellectual disability.[48]

(f) the age of the eligible person

[48]Ibid [76].

At the time of judgment, the applicant was 64 years old.[49]

(g) any contributions of the eligible person, otherwise than for adequate consideration, to building up the estate or to the welfare of the deceased or the deceased’s family

[49]Ibid [77].

The applicant did not depose to making any contribution to building up the deceased’s estate or to the welfare of the deceased.[50]

(h) any previous benefits to the eligible person or any beneficiary

[50]Ibid [78].

The judge referred to the respondent’s evidence that the applicant and David Gash failed to repay a substantial loan owing to the deceased and his wife, which was disputed by the applicant. The judge considered that, on balance, taking into account that the breakdown of the relationship between the applicant and her parents occurred around this time, the evidence relied on by the applicant supported the respondent’s position.[51]

(i) whether the eligible person was being wholly or partly maintained by the deceased, and if so, the extent and basis of such maintenance

[51]Ibid [79].

The applicant was not wholly or partially maintained by the deceased.[52]

(j) the liability of any other person to maintain the eligible person

[52]Ibid [80].

The judge observed that, although a partner might usually have primary liability to maintain their spouse, David Gash had suffered from multiple sclerosis since at least 2016 and was on a disability support pension. The judge considered that David Gash was limited in the support he could provide to the applicant, but that the applicant receives ‘indirect financial benefits’ by reason of the NDIS payments.[53]

(k) the character and conduct of the eligible person or any other person

[53]Ibid [81].

The judge reiterated her earlier finding that, ‘although the reasons for the estrangement differ’, it was clear that the applicant’s relationship with the deceased was substantially ‘non‑existent’ and they led separate lives with little or no contact with each other.[54]

(l) the effect that a family provision order would have on the amounts received from the deceased’s estate by other beneficiaries

[54]Ibid [82].

The judge observed that any family provision order in favour of the applicant would negatively affect the entitlements of all other beneficiaries as the estate is to be distributed in identified parts and there is no residuary estate. However, she also observed that the respondent’s offer would only reduce the parts of three beneficiaries.[55]

(m) any other relevant matter

[55]Those three beneficiaries being Wendy Klempt, Josef Jandovsky and Klara Jandovska: Reasons No 2, [83].

The judge noted that the respondent’s solicitors had filed an updated calculation of their costs of the proceeding.[56]
[56]Reasons No 2, [84].
The judge next identified that the only issue to be determined was the quantum of any further provision for the applicant.[57] She recorded the respondent’s open offer. She also identified that the applicant’s position had varied considerably throughout the proceeding and reiterated that the applicant’s evidence was still deficient, despite the fact that there had been two hearings.[58] However, she made the following finding:
While the plaintiff and her husband once had a comfortable lifestyle, the plaintiff now has limited financial means. She owns no real property and relies on a carer’s allowance from Centrelink for the bulk of her income. She no longer works in paid employment, possibly due to her age, but more likely due to her role as her husband’s carer. It is likely that she will not work in paid employment for the rest of her lifetime. The plaintiff and her husband have no superannuation and little savings or other assets.[59]
[57]Ibid [85].
[58]Ibid [86]–[89].
[59]Ibid [90].
The judge next made reference to the fact that, in some instances, a long estrangement between a parent and an adult child may weaken or destroy a claim.[60] She extracted a passage from Collicoat v McMillan[61] which emphasises that the matter of estrangement is considered from the viewpoint of the testator as follows:
What is right and proper, and thus what the wise and just testator must do, is not determined by the ‘character and conduct’ of each applicant but by what the testator ought to have felt in duty bound to provide notwithstanding any defects in character or conduct but nevertheless having due regard to the nature of their relationship with and their treatment (whether morally reprehensible or the opposite) of the testator during his or her lifetime. It is only when that behaviour has affected, or (arguably) is perceived to have affected, the testator that he or she is in good conscience entitled to make lesser or greater provision for an applicant than that to which the applicant would have been entitled having regard only to the bare bones of his or her financial needs and circumstances.[62]
[60]Ibid [91], citing Browne v Macaulay [1999] WASC 208, [19] (Murray J); Ford v Simes [2009] NSWCA 351, [71] (Bergin CJ in Eq., Tobias JA agreeing at [1], Handley AJA agreeing at [76]). Although that appeal was in the context of the New South Wales regime, her Honour’s comment on the entitlement of testators to make no provision for children was not so limited.
[61]Collicoat v McMillan [1999] 3 VR 803.
[62]Ibid 818 [43] (Ormiston J).
The judge then proceeded to deal with the applicant’s claim that she was entitled to the purchase price of $1.2–$1.5 million for a suitable home in areas near Brighton, stating:
It is not necessarily the duty of a testator to provide an adult daughter with an unencumbered property or the funds to acquire such property in Brighton or its surrounding suburbs. The plaintiff has rented her home for a considerable time at a rental that has not increased over the years. While her circumstances might change should the current owner decide to increase the rent or sell the property, there was no evidence suggesting that would be the case. Even if her current rental arrangements ceased, her income is sufficient for her to rent elsewhere at a lower rate given that her current housing is a three bedroom home in Brighton. The plaintiff and her husband could continue to rent a one or two bedroom house or unit in the vicinity of the Alfred Hospital and the Alfred Caulfield Hospital.[63]
[63]Reasons No 2, [92] (emphasis added).
As will be explained, below, the applicant made particular criticism of the words, italicised, above.
The judge concluded that, if accepted, the respondent’s open offer of a further 10 parts would have provided the applicant with ‘sufficient further provision for her proper maintenance and support.’[64] Although there would be a reduction for commission and costs, she considered that a further 10 parts would still provide the applicant with sufficient funds to cover her current needs of $75,500 (based on the applicant’s estimates for a car and furniture), as well as a substantial nest egg of approximately $242,450 for the future.[65]
[64]Ibid [94].
[65]Ibid [95].
The judge therefore ordered further provision for the applicant in accordance with the respondent’s offer.[66]
[66]The respondent’s offer being that only the parts of three beneficiaries are reduced in order for the applicant to receive 10 additional parts, that is, 2 parts from Wendy Klempt, 5 parts from Josef Jandovsky and 3 parts from Klara Jandovska: Reasons No 2, [83], [97].

Principles on appeal

As the applicant’s written submissions correctly acknowledge, the decision of the judge is a discretionary decision which is only reviewable in accordance with the principles in House v The King.[67] Thus, there will only be error if the judge acted upon a wrong principle, mistook the facts, took irrelevant matters into account, or failed to take relevant matters into account. Alternatively, even if it may not appear how the judge has reached the result, if the decision is ‘unreasonable or plainly unjust’, an appellate court may infer that there has been a failure properly to exercise the discretion.[68]
[67]House v The King (1936) 55 CLR 499; [1936] HCA 40.
[68]Ibid 505.

Grounds of appeal

The applicant advanced the following five proposed grounds of appeal:
Ground 1. The trial judge erred in awarding an amount of provision which was not ‘adequate and proper’ in leaving the applicant reliant upon a pension, uncertain revenue and presumed assistance from her daughter.
Ground 2. The trial judge erred by making an ultimate finding as to the extent of the applicant’s financial needs which is not based on or contrary to the evidence, and has failed to consider relevant matters.
Ground 3. The trial judge erred by making an ultimate finding as to the ability of the applicant to meet her needs from her own resources which is not based on or contrary to the evidence, and has failed to consider relevant matters.
Ground 4. The trial judge erred by taking into account an alleged loan to the applicant as: (a) a cause of ‘estrangement’ between the deceased and the applicant; and (b) as a benefit previously given to the applicant.
Ground 5. As a consequence of the errors referred to in grounds 1 to 4, or for other reasons, the trial judge erred in determining adequate provision for the applicant’s proper maintenance and support was 11 per cent of the net estate.

Whether error is established

There is some ambiguity in the grounds as framed, which also overlap. However, it is convenient to commence with ground 3.
In the applicant’s written case on ground 3, the applicant focused on the judge’s finding at paragraph 92 (reproduced at [57] above) that, even if the applicant’s current rental arrangements ceased, her income was sufficient for her to rent elsewhere ‘at a lower rate.’ More particularly, she focused on the finding that the couple could rent a one or two bedroom house or unit in the vicinity of the Alfred Hospital.
The applicant submitted that this finding was in error given that:
(a)there was no evidence before the Court of the rental costs of an alternative home;
(b)a three bedroom house was needed near relevant schools in order to host homestay students (which was needed to meet expenses); and
(c)the finding failed to take into account the likely ongoing needs of the applicant’s husband.
In her written case, the respondent contended that the judge was entitled to assume that rent for a home with one or two bedrooms in a less expensive suburb close to the Alfred Hospital would cost less than rent for a home in Brighton with three bedrooms. However, in oral submissions, counsel for the respondent did not seek to challenge the suggestion that, in making findings about an alternative rental property, the judge had taken a matter into account which was not the subject of evidence.
The approach of counsel for the respondent was appropriate. There was simply no evidence of the costs of alternative rental accommodation. Even presuming that a two bedroom home would be appropriate, available, and suitable, the judge was not entitled to assume that such a home would be cheaper. In fact, the only evidence before the judge as to the quantum of rent was that currently paid by the applicant. Given that this amount had not increased since 2007, it could provide no foundation for the judge’s finding.
For the sake of completeness, we also do not consider that the judge was entitled to assume that a two bedroom home would be appropriate in any event. The evidence was that a three bedroom home was necessary in order to earn homestay income, and, further, that homestay income was relied on to finance everyday expenses.[69] It could not be assumed that a two bedroom home was an appropriate alternative.
[69]Reasons No 2, [33], [71].
The judge therefore made a finding without evidence and took an irrelevant consideration into account (namely that the applicant could rent elsewhere at a lower rate). This also meant that the judge failed to properly assess the contingencies (such as reduced or no income from homestay students) that might realistically affect the applicant’s financial needs in the foreseeable future if the rent of her premises increased.
We should add that it is apparent that the judge was not assisted as well as she might have been by the applicant (or her lawyers) to reach an appropriate assessment of the quantum of the applicant’s claim. This was despite the judge’s best efforts in providing opportunities to the applicant to do so.
Nevertheless, we are satisfied that the applicant has established an error on the basis of proposed ground 3 (at least as elaborated in the written case). The result is that there will be leave to appeal, and the appeal will be allowed. This Court is now required to re-exercise the discretion as to the appropriate provision for the applicant. It is unnecessary in such circumstances to consider the other proposed grounds.
Re‑exercise of discretion
The applicant invited the Court to re‑exercise the discretion and sought a (further) revised allowance of $1.4 million. She submitted that the amount awarded should include:
(a)a contribution towards purchasing a property, of an unspecified amount;
(b)‘support’ with expenses and, as an alternative to purchasing property, her rental needs, based on the applicant’s alleged life expectancy of some 20 years. She provided non‑capitalised estimates of rent, homestay income and living expenses based on this life expectancy.[70] These amounts were said to be provided ‘to indicate the sort of amounts required to meet the necessities of her life’;
(c)an amount of $75,500 for a new car and furniture (as accepted by the judge); and
(d)an unspecified amount for other health or care needs for the applicant and her husband, including in relation to possible aged care costs.
[70]The applicant provided the following estimates: $852,000 for rent, $649,660 for homestay income and $691,960 for living expenses.
In oral submissions counsel for the applicant sought to provide some justification for the $1.4 million figure by highlighting that the amounts the applicant would incur in expenses and rental would be almost $1.5 million (over 20 years). However, this figure was not capitalised and also did not appear to take into account the amount of Centrelink income the applicant could also be expected to receive over that same period (of some $900,000).[71]
[71]$45,064.60 × 20.

It was not in issue that the conditions set out in s 91(2) of the Act were satisfied by the applicant. In re‑exercising the discretion, it is mandatory to have regard to the factors contained in ss 91(4) and 91A(1) of the Act. We do so in light of the comprehensive findings made by the judge. We also consider the relevant discretionary factors specified in s 91A(2).
In relation to s 91A(1), we take into account, as the respondent emphasised, the clear intention of the deceased as set out in his will, and particularly the reasons he provided for the grant of only 1 part to the applicant.
In relation to s 91(4)(a), the respondent accepted that there was a moral duty to provide for the applicant. However, the ‘degree’ to which there is a duty is affected by three matters.
First, there was an unchallenged finding there was an estrangement, such that the relationship between the deceased and the applicant was almost ‘non‑existent.’ In circumstances where the judge could not reach a specific conclusion as to the reasons for the estrangement, blame cannot be ascribed. However, the Court is entitled to take into account the nature of the relationship between the deceased and the applicant.[72] In circumstances where this estrangement has clearly impacted the testator, given the reasons he provided,[73] we consider that a wise and just testator was entitled to make a lesser provision for his adult daughter than would be appropriate if there had been an existing loving relationship.
[72]The Act, s 91A(2)(a).
[73]See Collicoat v McMillan [1999] 3 VR 803, 818 [43] (Ormiston J). The critical part of this paragraph is set out in [56] above.
Secondly (and partly a function of the first matter), there was no pre‑existing dependency on the deceased such that there might be an expectation that the deceased fulfil that ongoing dependency after death.[74]
[74]See also the Act, s 91A(2)(i); Walsh v Walsh [2013] NSWSC 1065, [121] (Hallen J).
Thirdly, as the judge found, the deceased had a moral obligation to provide for the respondent and each of his daughters. In reality, any order in favour of the applicant will negatively impact the entitlement of all the other beneficiaries in an estate which, while not small, is also not particularly large.[75]
[75]See also the Act, ss 91A(2)(c), (l).
Turning to s 91(4)(b), the respondent accepted that the distribution of the estate to a daughter of only 1 share failed to make adequate provision for the proper maintenance and support of the applicant. The ‘degree’ of this failure is articulated further below.
In relation to s 91(4)(c), the judge made the following critical and unchallenged findings:
(a)the applicant owns no real property, no superannuation and has little savings or other assets;
(b)the applicant relies on a carer’s allowance from Centrelink for the bulk of her income;
(c)the applicant no longer works in paid employment and likely will not work in paid employment for the rest of her lifetime;
(d)the applicant’s husband suffers from multiple sclerosis and hence was ‘limited’ in the support he could provide the applicant;
(e)as the couple’s annual expenditure on rent ($42,600) was only slightly less than their income from Centrelink ($45,064.60), it appeared that they relied on their income from homestay students in order to remain in their current home and to finance some of the other everyday costs of living, such as groceries.
In assessing the ‘degree to which the applicant is not capable of providing for her proper maintenance and support’, the Court is entitled to consider her needs at the time of hearing and for the foreseeable future.[76] Although the applicant appeared to be (barely) meeting her commitments at the time of the hearing, there were a number of foreseeable contingencies liable to affect her in the future. These included:
(a)that rent might increase;
(b)that the homestay income might disappear or be substantially reduced; and
(c)that, given the age of the applicant (64 at time of judgment),[77] and the health of her husband, costs in respect of their care and accommodation are likely to increase in the future.[78]
[76]See also ibid, s 91A(2)(d).
[77]Ibid s 91A(2)(f).
[78]Counsel for the respondent accepted that costs would increase in the future.
In terms of the amount specifically sought by the applicant, we reject the submission that a contribution towards purchase of property should be provided in circumstances where the claim for a property was abandoned. It seems unlikely that the applicant would have the necessary means to maintain ownership of a property in any event (given expenses such as rates and other upkeep).
We do, however, accept, as did the judge, that the applicant currently needs a new car and furniture which is valued at $75,500.
We further accept that some amount ought be provided for contingencies which would address the foreseeable risks of the homestay income being reduced, rent increasing, and further care needs arising. This, however, must be balanced against the other factors already specified, including the deceased’s clear intentions, and the interests of the other beneficiaries.
Overall, taking all the matters above, into consideration, we consider that 15 parts should be provided for the applicant. The remaining 85 parts should be then distributed to the beneficiaries pro rata in accordance with the terms of the will (including the 1 part already left to the applicant in the deceased’s will). On current estimates, the value of the applicant’s interest will be approximately $508,000[79] (which would include $75,500 for a new car/furniture as well as some $432,500 as sufficient further provision for her maintenance and support).
[79]This is based on the applicant receiving 16 shares of an estate worth $3.179 million. However, the estate will be reduced by unknown costs and commission. Further, although the applicant will receive 15 further shares, her existing 1 share will be slightly reduced once the pro rata exercise is completed.
Accordingly, we will make an order that an adjustment be made such that the applicant receives 15 additional parts.
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[2023] VSCA 189

17 August 2023