Hall v Carney (No 3)

Case [2020] SASC 177

SUPREME COURT OF SOUTH AUSTRALIA

(Civil: Application)

HALL v CARNEY & ORS (No 3)

[2020] SASC 177

Judgment of The Honourable Justice Stanley

24 September 2020

LIMITATION OF ACTIONS - LIMITATION OF PARTICULAR ACTIONS - TRUSTS AND DECEASED ESTATES - STATUTORY PROVISIONS IN TRUSTEE ACTS

LIMITATION OF ACTIONS - LIMITATION OF PARTICULAR ACTIONS - TRUSTS AND DECEASED ESTATES - ACTIONS AGAINST DECEASED ESTATES

SUCCESSION - ADMINISTRATION OF ESTATE - DISTRIBUTION - OTHER MATTERS

The deceased made her last will and testament on 17 November 2006.  She died on 27 January 2007.  The will was admitted to probate on 13 November 2012.  The plaintiff, Grantley Thomas Aubrey Hall (Grantley), and one of the executors, Vivienne Kathleen Carney (Vivienne), are children of the deceased, and beneficiaries of her estate.

Grantley disputed the validity of the will.  The executors and Geoffrey commenced a probate action in the Court to have the will admitted to probate.  Following trial, an order was made on 1 December 2011 admitting the will to probate.  Prior to the issue of the grant of probate Grantley unsuccessfully brought an appeal to the Full Court .

In 2013 Grantley then commenced this action seeking further provision out of the estate of the deceased pursuant to the Inheritance (Family Provision) Act 1972 (SA) (the IFP Act).

The claim under the IFP Act was resolved at mediation and subsequently orders were made on 15 July 2014 for provision out of the estate to Grantley, which annexed terms of compromise which were made a rule of Court in the action.

Grantley then unsuccessfully sought to injunct the sale to Vivienne of a property forming part of the estate.  The will gave Vivienne an option to purchase the property. Grantley was ordered to pay costs of that application to the executors and Vivienne in her capacity as beneficiary. 

Grantley has asserted various causes of action against the executors relating to the sale of the property.  He alleges that the property was sold at an undervalue, or not in accordance with the option which Vivienne had to purchase the property. 

No substantive claim has been instituted by Grantley against the executors relating to the sale apart from claims set out in an interlocutory application brought by him which has not been further prosecuted since the injunction application failed in September 2015.  The executors treated the position as if Grantley had foreshadowed claims against them and placed him on notice from at least 7 December 2015 that this was their understanding of Grantley’s position.

The executors now bring an application for barring orders pursuant to s 29(2) of the Trustee Act 1936 (SA) and an application for advice and direction pursuant to s 69 of the Administration and Probate Act 1919 (SA).

They seek orders against the plaintiff barring him, with effect from 5 January 2020, from instituting any proceedings against them in respect of notified claims served on him on 5 July 2019; an order that the executors be at liberty to administer the estate…

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AGLC
Hall v Carney (No 3) [2020] SASC 177
Case
[2020] SASC 177
Decision Date

CaseChat Overview and Summary

In the matter of Hall v Carney (No 3), the Court was tasked with providing advice and direction to the executors of the deceased’s estate concerning the administration and distribution of the estate. The primary parties involved were Grantley Hall, one of the deceased’s children, and the executors of the will, Vivienne and James Cavalier Douglas. The legal issues before the Court centred on whether the executors could deduct legal costs from the residuary beneficiaries' shares and whether they could proceed to distribute the estate to the beneficiaries.

The Court found that the executors were justified in deducting the legal costs incurred from 10 August 2017 from the entitlements of the plaintiff, Grantley Hall. This deduction was deemed reasonable given the plaintiff's actions had caused unnecessary delays and expenses. Additionally, the Court ruled that the executors should proceed with the distribution of the residuary estate to the beneficiaries, subject to any orders regarding the costs of the application. The Court noted that the delay in the estate's administration was substantially due to Grantley's conduct, and it was unjust for the other beneficiaries to bear the burden of these delays and additional costs. The executors were thus advised and directed to proceed with the distribution of the estate accordingly.

Orders

Orders of the court

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Background

Background to the litigation

I will refer to this evidence in the course of these reasons for the purpose of making relevant findings of fact. Background to the application Grantley and Vivienne are the two living children of the deceased. The third defendant, Geoffrey Gordon Elliott (Geoffrey) is the deceased’s second husband and widower. Geoffrey is now 94 years of age. The deceased died leaving the will appointing Vivienne and James Cavalier Douglas (the executors) as her executors and trustees. Grantley disputed the validity of the will. The executors and Geoffrey commenced a probate action (probate action) in the Court to have the will admitted to probate. Following trial, an order was made on 1 December 2011 admitting the will to probate. Prior to the issue of the grant of probate Grantley appealed to the Full Court against the order admitting the will to probate. The appeal was dismissed. Under the will Vivienne was left certain personal items; real property at 8 Dawson Avenue, South Plympton (the Dawson Avenue property); and a dance studio business. Geoffrey was given a right of residence for a limited period in the deceased’s principal residence at 247 Anzac Highway Plympton (Anzac Highway property) after which the property fell into the residue. The will gave Vivienne an option to purchase the Anzac Highway property. The residue of the estate was left in equal shares to Vivienne, Grantley and Geoffrey. In 2013 Grantley commenced this action seeking further provision out of the estate of the deceased pursuant to the Inheritance (Family Provision) Act 1972 (SA) (the IFP Act). The claim was resolved at mediation in July 2014. The claim under the IFP Act was resolved by an order made on 15 July 2014 for provision out of the estate to Grantley, which annexed terms of compromise which were made a rule of Court in the action. Under the settlement Grantley received a further legacy of $250,000 and certain agreed costs of the probate action. The settlement also provided for the manner in which Vivienne was to exercise her option to purchase the Anzac Highway property. Subsequently Vivienne exercised her option to purchase the Anzac Highway property. In 2015 Grantley sought to injunct the sale of the Anzac Highway property to Vivienne. The injunction was refused and he was ordered to pay costs of that application to the executors and Vivienne in her capacity as beneficiary. Settlement of the sale of the Anzac Highway property to Vivienne occurred on 7 October 2015. Grantley has asserted various causes of action against the executors relating to the sale of the Anzac Highway property. It appears he alleges that the property was sold at an undervalue, or not in accordance with the option which Vivienne had to purchase the property. No substantive claim has been instituted by Grantley against the executors relating to the sale apart from claims set out in an interlocutory application brought by him which has not been further prosecuted since the injunction application failed in September 2015.[21][21] Interlocutory application dated 24 August 2015 (FDN 38).

Evidence

Evidence Before The Court

The executors also seek advice and direction of the Court pursuant to s 69 of the APA for the determination of the following matters in connection with the administration of the estate of the deceased in accordance with her will, namely:(a)Whether in determining the value, payment and appropriation of the assets of the deceased in satisfaction of the equal one-third share in the residuary estate of the deceased under clause 6.3 of the will of the residuary beneficiaries the executors are justified in doing and should deduct from or set off against the entitlements of the plaintiff the amount of legal costs and disbursements that the executors have incurred from 10 August 2017 in responding to the questions raised by the plaintiff in relation to the accounts of the estate of the deceased and in relation to the administration of the estate of the deceased as referred to in the affidavit of Vivienne Kathleen Carney sworn on 21 March 2019; and (b)Whether the executors would be justified in now distributing, and should distribute, the residuary estate of the deceased, subject to such orders as the Court may make on the third interlocutory application of the executors as to costs or other matters, to the residuary beneficiaries under the will.The evidence On the hearing of the application the executors read the following affidavits:·Eighth affidavit of Shona Hoskins sworn on 16 April 2020.[1][1] FDN 74.·Seventh affidavit of Shona Hoskins sworn on 4 February 2020.[2][2] FDN 71.·Affidavit of Shona Hoskins sworn on 7 September 2015.[3][3] FDN 41.·Affidavit of Mark Peter Jappe affirmed on 17 December 2019.[4][4] FDN 66.·Second affidavit of Mark Peter Jappe affirmed on 28 January 2020.[5][5] FDN 69.·Affidavit of Executors sworn on 27 June 2013.[6][6] FDN 5.·First affidavit of James Cavalier Douglas sworn on 7 September 2015.[7] [7] FDN 40.·Second affidavit of James Cavalier Douglas sworn on 7 September 2015.[8][8] FDN 42.·Third affidavit of James Cavalier Douglas sworn on 1 February 2017.[9][9] FDN 55.·Affidavit of Vivienne Kathleen Carney sworn on 27 June 2013.[10]·Affidavit of Vivienne Kathleen Carney affirmed on 10 September 2015.[11]·Affidavit of Vivienne Kathleen Carney sworn on 20 March 2019.[12]·Affidavit of Geoffrey Gordon Elliott sworn on 20 March 2014.[13]·Fourth affidavit of Grantley Thomas Aubrey Hall sworn on 6 December 2013.[14] ·Ninth affidavit of Grantley Thomas Aubrey Hall affirmed on 6 December 2018.[15]·Tenth affidavit of Grantley Thomas Aubrey Hall affirmed on 4 June 2019.[16] ·Eleventh affidavit of Grantley Thomas Aubrey Hall affirmed on 7 April 2020.[17] ·Third affidavit of Duncan James Fowler affirmed on 24 August 2015.[18] [10] FDN 6.[11] FDN 44.[12] FDN 61.[13] FDN 21.[14] FDN 15. [15] FDN 59.[16] FDN 63.[17] FDN 73.[18] FDN 39. The plaintiff read the affidavit of Timothy Campbell affirmed on 5 February 2020[19] and the eighth affidavit of Grantley Thomas Aubrey Hall sworn on 22 September 2015.[20] [19] FDN 72.[20] FDN 48.

Decision

Reasons for decision

I am further satisfied that the executors should proceed to distribute the residuary estate and I direct accordingly. Conclusion I am satisfied that the executors are entitled to the barring order they seek. The administration of the estate has been inordinately delayed. That delay has been substantially caused by Grantley. His conduct has also unreasonably occasioned cost and expense to the estate. The other beneficiaries should not suffer as a result. The executors should now proceed to distribute the estate subject to any order as to the costs of this application. Accordingly, I would give the advice and direction sought by the executors. I will hear the parties as to the costs of this application. I would direct the solicitors for the executors to bring into Court minutes of order that reflect these reasons.

Ratio Decidendi

Legal Principle Established

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