Hachem v Kanawati
[2024] WASC 474
•11 DECEMBER 2024
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS
CITATION: HACHEM -v- KANAWATI [2024] WASC 474
CORAM: HILL J
HEARD: 19 NOVEMBER 2024
DELIVERED : 25 NOVEMBER 2024
PUBLISHED : 11 DECEMBER 2024
FILE NO/S: CIV 2218 of 2024
BETWEEN: NAZIHA HACHEM
Plaintiff
AND
MAHAMMED SALIM KANAWATI
Defendant
Catchwords:
Probate - Existing application to prove will in solemn form - Application to appoint administrator and receiver pendente lite - Dispute as to who should be appointed - Turns on own facts
Legislation:
Administration Act 1903 (WA) s 35
Result:
Application granted
Category: B
Representation:
Counsel:
| Plaintiff | : | M L Bennett |
| Defendant | : | R J Squires |
Solicitors:
| Plaintiff | : | Bennett |
| Defendant | : | Edwards Lockhart |
Case(s) referred to in decision(s):
Henderson v Executor Trustee Australia Ltd [2005] SASC 477
Moscufo (as executrix of the will of Moscufo) v Moscufo [2024] WASC 404
HILL J:
(This judgment was delivered extemporaneously and has been edited from the transcript to include references, headings, and to correct matters of grammar and expression.)
On 22 October 2024, the defendant filed a chamber summons seeking orders for the appointment of an administrator and receiver of the estate of Ghassan Ahmad Jabado pursuant to s 35 of the Administration Act 1903 (WA).
Mr Jabado died on about 23 September 2024. He left a sizeable estate comprising numerous properties, millions of dollars in various bank accounts, a self‑managed superannuation fund, motor vehicles, and firearms as well as shares in a company, G J Giant Pty Ltd (G J Giant). G J Giant itself has substantial landholdings, including a substantial farming property near Mullewa.[1]
[1] Affidavit of Mahammad Salim Kanawati filed 22 October 2024 [5], [9] ‑ [26].
Approximately three weeks before his death, Mr Jabado executed a will in which he appointed the defendant as executor and trustee. Under this will, his beneficiaries are the plaintiff and the defendant as to 50% each. This altered the position from an earlier will under which the Public Trustee was appointed as executor and the plaintiff was the sole beneficiary.
The defendant has commenced proceedings seeking to prove the September 2024 will in solemn form, as well as seeking a grant of probate. The plaintiff has indicated she intends to object to this will being proved and contends that the earlier will should be the subject of proof and the grant of probate.
Both parties agree that an interim administrator should be appointed and that it should be an independent commercial administrator. The contest between the parties on the application before me was whether it should be Mr Mohen of RSM Australia Partners (RSM) (as contended by the defendant) or Mr Rocke and Mr Trpcevski of WA Insolvency Solutions (as contended by the plaintiff). There are also some relatively minor issues between them as to the particular terms of the appointment.
In support of the defendant's application, the defendant read four affidavits being:
(a)an affidavit of the defendant filed 22 October 2024;
(b)an affidavit of Mr Ashoorian, the defendant's former solicitor, filed 22 October 2024; and
(c)two affidavits of Ms Edwards, the defendant's current solicitor, filed 14 and 15 November 2024.
The plaintiff relied on three affidavits of Ms Nofal, a solicitor employed by Bennett, the solicitors for the plaintiff, filed 7, 8 and 18 November 2024, which annexed correspondence with WA Insolvency Solutions.
Legal principles
In Henderson v Executor Trustee Australia Ltd,[2] Debelle J (with whom Sulan and Anderson JJ substantially agreed) reviewed the history and nature of an application for the appointment of an administrator pendente lite. Solomon J recently summarised the principles that flow from this judgment in his decision in Moscufo (as executrix of the will of Moscufo) v Moscufo at [23] in the following terms:[3]
(1) Historically, the practice has been only to grant administration pendente lite in cases where the necessity for the grant is made out.
(2) The appointment of an administrator pendente lite is analogous to the appointment of a receiver. Generally, there is a distinction between a receiver on the one hand, and the receiver and manager on the other. An administrator, like a court-appointed receiver, is more in the nature of a caretaker than someone charged with management, which may include a more substantial involvement with the assets of the estate.
(3) Notwithstanding that distinction, when considering the administrator's duty to preserve the assets, it is necessary to consider all the relevant facts which may include not only preservation, but enhancement of the value of the assets of the estate.
(4) There is no prescribed role for an administrator pendente lite. The role will vary according to the circumstances in which the appointment is made and the purpose for the appointment.
(5) The object of a grant of administration pendente lite is to ensure that the estate of the deceased is managed and preserved for the benefit of those found to be entitled thereto. The duty of the administrator pendente lite therefore, is to get in the assets of the estate and manage and preserve them for the benefit of those found to be entitled to those assets.
(6) An administrator, like a trustee, cannot prefer the interests of one beneficiary over another. Where the beneficiaries cannot agree, and a course of conduct proposed by the administrator might adversely affect one or other of the beneficiaries, the court will, as a general rule, give directions which will preserve the status quo.
[2] Henderson v Executor Trustee Australia Ltd [2005] SASC 477.
[3] Moscufo (as executrix of the will of Moscufo) v Moscufo [2024] WASC 404.
Who should be appointed?
Where the court has been required to determine who of a selection of independent parties should be appointed as administrator, the courts have taken into account a number of factors, including comparative cost as well as experience.
In this case, both parties have proposed administrators who are both clearly suitable and competent. There was, on the evidence before the court, very little that would enable the court to properly distinguish between them. Their charge-out rates are similar; all are independent; similar‑sized teams are proposed; and all are registered liquidators.
Counsel for the defendant submitted that the costs of Mr Mohen were likely to be less, as the defendant proposed a sole administrator as opposed to a joint administrator. Counsel for the plaintiff did not accept this was the case and emphasised that, given that all things were virtually equal, the court should appoint the plaintiff's choice, given that she is a beneficiary of the deceased's estate whichever will is found to be valid.
Both parties submitted there was no wrong choice as to who should be appointed and that the application was, in fact, a choice between two right choices. I accept this submission.
Ultimately, I have decided that because of his greater experience in the administration of deceased estates, as well as the network of RSM through Western Australia, that it is Mr Mohen who should be appointed.
As discussed with counsel at the hearing of the application, I consider that an initial inventory together with their accounts and a report on the affairs of G J Giant should be filed on the three‑month anniversary of the appointment, in addition to the times proposed in the defendant's minute and that copies of these documents should be provided to the parties.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
JN
Associate to the Honourable Justice Hill
11 DECEMBER 2024
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