Gibbs as Administrator of the Estate of Craig Edward Gibbs (Dec) v Gibbs (an infant) by his Guardian ad litem Lisa Gaye Pratico (nee Doust)
[2004] WASC 132
GIBBS as Administrator of the Estate of CRAIG EDWARD GIBBS (DEC) -v- GIBBS (an infant) by his Guardian ad litem LISA GAYE PRATICO (nee DOUST) [2004] WASC 132
| Link to Appeal : | [2006] WASCA 224 |
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2004] WASC 132 | |
| Case No: | CIV:1629/2002 | 11 & 19 MAY 2004 | |
| Coram: | MASTER SANDERSON | 16/06/04 | |
| 6 | Judgment Part: | 1 of 1 | |
| Result: | Application refused | ||
| B | |||
| PDF Version |
| Parties: | KAYE LYNETTE GIBBS as Administrator of the Estate of CRAIG EDWARD GIBBS (DEC) MATTHEW ROBERT GIBBS (an infant) by his Guardian ad litem LISA GAYE PRATICO (nee DOUST) |
Catchwords: | Trustees Application to remove trustee of estate Turns on own facts |
Legislation: | Nil |
Case References: | Miller v Cameron & Ors (1936) 54 CLR 572 Porteous v Rinehart (1998) 19 WAR 495 Bates v Messner (1967) 67 SR(NSW) 187 Bramston v Morris, unreported; SCt of NSW; Powell J; 20 August 1993 Gava & Anor v Grljusich & Anor, unreported; SCt of WA; Library No 960010; 11 January 1996 Hunter v Hunter [1938] NZLR 520 In the Goods of Loveday [1900] P 154 Mavrideros v Mack, unreported; SCt of NSW; Young J; 16 June 1997 Phelan v Booth (1941) 43 WALR 60 Porteous v Rinehart (1998) 19 WAR 495 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
MATTHEW ROBERT GIBBS (an infant) by his Guardian ad litem LISA GAYE PRATICO (nee DOUST)
Defendant
Catchwords:
Trustees - Application to remove trustee of estate - Turns on own facts
Legislation:
Nil
Result:
Application refused
(Page 2)
Category: B
Representation:
Counsel:
Plaintiff : Mr R J L McCormack
Defendant : Mr M L Segler
Solicitors:
Plaintiff : Damien Brennan
Defendant : Shane Michael Brennan
Case(s) referred to in judgment(s):
Miller v Cameron & Ors (1936) 54 CLR 572
Porteous v Rinehart (1998) 19 WAR 495
Case(s) also cited:
Bates v Messner (1967) 67 SR(NSW) 187
Bramston v Morris, unreported; SCt of NSW; Powell J; 20 August 1993
Gava & Anor v Grljusich & Anor, unreported; SCt of WA; Library No 960010; 11 January 1996
Hunter v Hunter [1938] NZLR 520
In the Goods of Loveday [1900] P 154
Mavrideros v Mack, unreported; SCt of NSW; Young J; 16 June 1997
Phelan v Booth (1941) 43 WALR 60
Porteous v Rinehart (1998) 19 WAR 495
(Page 3)
1 MASTER SANDERSON: By chamber summons dated 13 October 2003 the defendant, by his guardian ad litem, seeks orders pursuant to s 29 and s 45 of the Administration Act 1903, to the effect that the grant of administration of the estate of Craig Edward Gibbs ("the deceased") to the deceased's mother be revoked and that the administration of the deceased's estate otherwise be granted to the defendant's mother and guardian ad litem.
2 The defendant is an infant born on 12 March 1997. He is presently aged 7 years. He resides with his mother, Lisa Gaye Pratico, who is his guardian ad litem. He also resides with his stepfather and younger children of his mother and his stepfather.
3 It is not entirely clear from the affidavit evidence precisely what assets the plaintiff presently holds either as administratrix of the deceased's estate or as trustee on behalf of Matthew. Appearing as annexure "H" to the plaintiff's affidavit sworn 5 May 2004, is a statement of assets and liabilities filed pursuant to r 9B of the Non-Contentious Probate Rules. Under the heading "Moveable Property" there is a trail bike, a motor vehicle and household furniture, each of which is of nominal value. They can be put to one side. There is a Commonwealth Bank account with a balance of $8767.50. The moveable property also includes 1108 Wesfarmers Ltd shares, 2036 Franked Income Fund shares, 98 Boyup Brook Co-operative Co Ltd shares and 1794 Westralian Farmers Co-operative Ltd shares. The value of the Wesfarmers shares is put at $13,140.88. The total value of all of these shares is said to be around $17,000. There is no way of knowing what the true value of these shares is at present - the evidence does not deal with this issue. But what can be said, however, is that the Wesfarmers shares would be worth a good deal more than the value stated. However, on any reasonable view, the shareholding is not of great value.
4 Also shown as part of the moveable property is an entitlement described as "Superannuation-Gwalia Superannuation Fund". The amount due is said to be $455,000. This superannuation entitlement has something of a history. After the death of the deceased, the trustee of the Fund determined that the Fund should be divided evenly between the defendant and one Danielle Smith, who is described in the documents as the "alleged de facto spouse of the deceased member". Ms Pratico, on behalf of the defendant, asked for a review of that decision. On 18 July 2001 the trustee confirmed its original decision. Ms Pratico then took the matter to the Superannuation Complaints Tribunal. On 22 April 2003 the tribunal determined that all of the fund should be paid to Ms Pratico as
(Page 4)
- trustee for the defendant. For this purpose a Child Maintenance Trust has been established. A copy of this document appears as annexure "LPG7" to the affidavit of Ms Pratico, sworn 7 April 2004. It is not clear from the evidence precisely what amount presently stands in trust for the defendant. However, it is in the region of $500,000.
5 Returning to the statement of assets and liabilities, under the heading "Immoveable property in WA", two properties are shown. They are described by volume and folio numbers but not otherwise identified. It is clear from the plaintiff's affidavit that as at the date of his death the deceased own two properties - one in Greenbushes and one in Boyup Brook. The plaintiff says in her affidavit (par 25) that she has arranged to sell the Greenbushes home. Presumably the funds realised from that sale have been paid into a bank account. The implication from par 25 is that they have been paid into the Commonwealth Bank account held by the deceased at the date of his death. The home in Boyup Brook has been rented out. It is clear that the plaintiff has been collecting the rents, paying all the outgoings and generally maintaining the property. Again, although it is not expressly stated in the affidavit of the plaintiff, it would appear that any funds received from renting the Boyup Brook property have been paid into the Commonwealth Bank.
6 The first question that arises is whether the plaintiff is properly to be regarded as an administratrix of the estate or as a trustee. This is an important question of fact. The principles which apply to the removal of an executor or an administrator are different to those which apply to the removal of a trustee. So the first matter for determination then is whether, on the facts I have outlined above, the plaintiff is properly to be regarded as an administratrix or as a trustee.
7 There can be no doubt that when letters of administration were granted to the plaintiff she was properly to be regarded as administratrix of the deceased's estate. The question is in what circumstances she will cease to be an administrator of the estate and will become a trustee. The position is summarised in Jacob's: Law of Trusts in Australia at par 245:
"The test is clear - he (the executor/administrator) commences to hold property as trustee when his executorial duties in respect of that property have ended, but the difficulty in practice is to ascertain precisely whether those executorial duties in respect of that property have in fact ended."
(Page 5)
8 It is possible that an executor or administrator can be both an executor or administrator and a trustee of different parts of the deceased's property. But that is not the case here. It is clear that all that was necessary to be done to administer the estate has been done. The shares have been transferred into the name of the plaintiff, as has the remaining property. All of these assets are now held by the plaintiff on trust for the defendant.
9 The principles to be applied when considering the jurisdiction to remove trustees were set out by White J in Porteous v Rinehart (1998) 19 WAR 495. At 506- 518 his Honour analyses in detail the applicable law. With respect I would adopt entirely what his Honour has to say. Perhaps the position can best be summarised by reference to what was said by Dixon J in Miller v Cameron & Ors (1936) 54 CLR 572 at 580 - 581:
"The jurisdiction to remove a trustee is exercised with a view to the interests of the beneficiaries, to the security of the trust property and to an efficient and satisfactory execution of the trusts and a faithful and sound exercise of the powers conferred upon the trustee. In deciding to remove a trustee the Court forms a judgment based upon considerations, possibly large in number and varied in character, which combine to show that the welfare of the beneficiaries is opposed to his continued occupation of the office. Such a judgment must be largely discretionary. A trustee is not to be removed unless circumstances exist which afford ground upon which the jurisdiction may be exercised. But in a case where enough appears to authorise the Court to act, the delicate question whether it should act and proceed to remove the trustee is one upon which the decision of the primary Judge is entitled to especial weight."
10 There is no evidence in this case that the plaintiff as trustee of the deceased's estate has acted improperly or in breach of trust. No suggestion to that effect was made by the defendant. It was submitted that the plaintiff may have a conflict of interest such as would justify her removal. With respect, I can see no evidence that such a conflict exists. It is true that there is an unhappy relationship between the plaintiff and the defendant. Most of the affidavit evidence relied upon by the parties deals with that issue. But the fact that the plaintiff and the defendant are at odds does not, in and of itself, give rise to a conflict of interest. There is no evidence to suggest that circumstances have arisen which might give rise
(Page 6)
- to a legitimate fear that the plaintiff would prefer her interests over those of the defendant.
11 When the defendant's case is analysed, it really comes down to this. The defendant holds property as trustee for her son. She is in a position to assess his needs and to make appropriate provision for him. She will be in a position where she is trustee until the trust vests and Matthew takes control of the property. On the other hand, the plaintiff, although a trustee, is not in day-to-day contact with Matthew. She does not know what his needs might be and she is not in a position to administer the trust to his advantage. Further, so it is said, nothing is to be gained by having two separate trusts. It would be in the best interests of Matthew if all of the property of the deceased were handed over to the defendant to allow her to properly administer the fund.
12 In essence, the argument put by the defendant is based upon convenience - it is simply more convenient to have all of the trust property administered by one person and the proper person is the defendant. While I appreciate the strength of that argument, it is not in my view sufficient to warrant removal of the plaintiff as trustee of the deceased's estate. To adapt the words of Dixon J in Miller v Cameron, in my view there are no circumstances which exist which afford ground upon which the jurisdiction may be exercised. Put another way, there is nothing to suggest that the welfare of Matthew, as a beneficiary of the estate, is opposed to the plaintiff's continued occupation of the office of trustee.
13 In the circumstances then, I am not satisfied that an order ought be made removing the plaintiff as trustee of the estate. Accordingly I would dismiss the application. I will hear the parties as to costs.
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