Hynard v GAVROS - [2014] SASC 42

SUPREME COURT OF SOUTH AUSTRALIA
(Civil)
HYNARD v GAVROS
[2014] SASC 42
Judgment of Judge Dart a Master of the Supreme Court
25 March 2014
SUCCESSION - FAMILY PROVISION - REQUIREMENT FOR ADEQUATE AND PROPER MAINTENANCE - DUTY OF TESTATOR - DUTY TO CHILDREN
The plaintiff is the daughter of the deceased – in her will the deceased left the whole of the residue of her estate to the first defendant who is the sister of the deceased – the plaintiff claims she is not left with adequate provision for her proper maintenance, education and advancement in life having regard to her moral claim to a greater share of the deceased’s estate.
Held: granting the plaintiff’s application – order made pursuant to s 7 of the Inheritance (Family Provision) Act 1972 (SA) – the plaintiff is to receive an amount equal to 55 per cent of the residue of the deceased’s estate.
Inheritance (Family Provision) Act 1972 (SA) s 7; Wills Act 1936 (SA) s 12, referred to.
Bowyer v Wood (2007) 99 SASR 190; Vigolo v Bostin and Others (2008) 221 CLR 191; Bosch v Perpetual Trustee Co Ltd [1938] AC 463, applied.
Singer v Berghouse (1994) 181 CLR 201; Worladge and Another v Doddridge and Others (1957) 97 CLR 1; Coates v National Trustees Executors and Agency Company Limited and Another (1956) 95 CLR 494; Re Allen (deceased) [1922] NZLR 218; Re Greene's Estate (1930) 25 Tas. L.R. 15; White v Barron and Another (1979) 144 CLR 431; Ahearn v Ahearn [1917] St R Qd 167; Goodman v Windeyer and Others 144 CLR 490, discussed.

HYNARD v GAVROS
[2014] SASC 42

The plaintiff seeks an order that further provision be made out of the estate of her mother (“the deceased”) who died on 28 September 2012.
The application is made pursuant to s 7 of the Inheritance (Family Provision) Act 1972 (SA) (“the Act). The plaintiff says that she has been left without adequate provision for her proper maintenance, education or advancement in life.
In my view, the plaintiff is, for the reasons that follow, entitled to an additional provision from the estate of the deceased. I propose to order that the plaintiff have a provision amounting to 55 per cent of the residue of the deceased estate.
The will
The will of the deceased was made on 22 March 2001. It was admitted to probate on 7 February 2013. The administration of the estate was granted to the defendant as the sole executor named in the will. The defendant is the sister of the deceased.
The will contained a number of specific bequests. They include:
1Some specified jewellery and the sum of $2000 to the deceased’s niece, Talia Kate Forrest.
2Some specified jewellery and the sum of $2500 to the plaintiff.
3Some specified jewellery and the sum of $2000 to the deceased’s niece, Donna Leigh.
4Some specified jewellery to the deceased’s other sister, Helen Jean Morgan.
5Some specified jewellery to the defendant.
The will bequeathed the whole of the residue of the estate to the defendant.
Background
The trial of the action was conducted pursuant to the provision of Supreme Court Civil Rules 312(12) as a summary trial. Summary trials are permitted where the net estate of the deceased is less than $500,000. As at the date of the trial, the parties estimate the value of the net estate of the deceased to be in the order of $372,000. It consists, almost completely, of monies that are invested. Accordingly, the value of the estate will increase as interest accrues on the invested monies.
At the trial the evidence of both parties was primarily given by affidavit. There was some limited evidence in chief from the plaintiff and defendant. They were the only witnesses to give oral evidence. Each was subject to limited cross-examination. I accept the evidence of each. There are very few factual matters in issue, nor do any serious issues of credit arise. It is simply that the parties advocate for different results based on the largely undisputed evidence. The contention of the defendant is that the plaintiff has failed to establish that she has been left without adequate provision.
The plaintiff was adopted by the deceased and her then husband as a three day old infant. She was born on 5 March 1965 and is currently 49 years of age.
When the plaintiff was about 8 years old the deceased and her father separated. The father moved to Queensland and the plaintiff initially spent part of the year in South Australia and part of the year in Queensland.
There is some suggestion that the deceased may have suffered from some mental health issues at or soon after the time of the separation. It is not necessary for the Court to make any findings about that. The upshot was, however, that from about 1975 the plaintiff lived on a full-time basis with her father in Queensland and only came to South Australia to visit her mother during the school holidays.
After completing High School the plaintiff obtained a traineeship as a commercial artist. In 1984 the plaintiff came to Adelaide to be with her mother. She lived with her mother for the first few weeks and then lived independently in Adelaide. The plaintiff stayed in Adelaide for about six months and thereafter returned to Queensland to live and has lived there ever since.
At some time during 1990 the plaintiff became pregnant with her first son with her then partner. The deceased went to Queensland to stay with the plaintiff prior to the birth of her son. She stayed for about four weeks afterwards to assist her daughter.
Approximately five months after having her first son the plaintiff returned to work at a printing business. She worked as the Art Department Manager. When her son was about two years old she brought him to Adelaide for a holiday for two weeks to see his grandmother. The plaintiff and her partner married on 1 August 1993. The deceased was unable to attend the wedding but wrote a letter, which was admitted to evidence.
During this period the deceased was living with her partner, John Matthews. The exact nature of that relationship is the subject of some dispute. It is not necessary for present purposes to resolve the exact nature of that relationship.
The plaintiff subsequently separated from her husband and met her now husband, Mr Hynard, in January 2000. The plaintiff married him in 2003 and subsequently had her second son, Lachlan. He was born in October 2003. The plaintiff has not been in paid employment since that time.
There was uncontroverted evidence that the deceased and the plaintiff, over a period of many years, spoke to each other on a regular basis on the telephone. That was accepted by the defendant.[1] There were not a great number of visits of each to the other, but the plaintiff tendered a number of cards and letters as sent by the deceased to her over a number of years, which demonstrated an ongoing close and affectionate relationship. There is no suggestion that the relationship of mother and daughter was ever fractured or broke down.
[1] Transcript page 55, line 8.
After the birth of her second son the plaintiff attended a TAFE college and completed secondary school years 11 and 12 as an adult student. In 2007 she commenced a Bachelor of Urban and Environmental Planning at Griffith University. Because of issues relating to her second son’s health, she has only been able to study for her degree on a part-time basis. In evidence she expressed hope that she will complete her degree at the end of this year.
The plaintiff came to South Australia for her mother’s 72^nd birthday in 2007. She found this very stressful as, by that time, her mother’s declining mental health meant that she did not recognise her daughter. In 2005 her mother was first diagnosed as having dementia.
The plaintiff drove to Adelaide in 2009 as a consequence of the defendant telephoning her and advising that her mother had pneumonia, was seriously ill, and may not survive. During that 2009 visit the defendant suggested to the plaintiff that she sort through her mother’s papers. In doing so, the plaintiff found that her mother had kept all of the letters that she sent her over the years.
In addition to finding the letters that her mother kept, the plaintiff found a two page hand-written document. The document, which was in the handwriting of her mother, was a draft of a will.[2] In the document, apart from a number of specific bequests, the deceased left her estate to be divided equally between the plaintiff and defendant. The document is not put forward as a document that could be admitted to probate under the provisions of s 12 of the Wills Act 1936. It seems that the document was prepared after the plaintiff’s second marriage in 2003, as it refers to her by her married name. In my view, the only evidentiary value of the document is to demonstrate that as at 2003, or shortly thereafter, the relationship between the mother and daughter was still sound and that the deceased was giving some consideration to altering her will. For reasons that cannot now be established that did not occur. It may be as simple as the fact that the onset of dementia prevented it from occurring.
[2] Exhibit P7.
At the time the deceased prepared her will in 2001 she had very few, if any, assets. Sometime after the preparation of her will, her partner John Matthews died and left to the deceased the residential unit they shared. It is that asset that has provided the bulk of the value of the estate of the deceased.
Financial position of the parties
The financial position of both of the parties are relevant to the issues that need to be resolved in this litigation. The plaintiff is a university student. Her only current income is payment from Centrelink for Family Benefit and Carer’s Allowance. The payment is $265.90 per fortnight.
The plaintiff owns a house at Birkdale in Queensland, with an estimated value of $450,000. The plaintiff inherited the house from her father. The house is subject to a mortgage in an amount of approximately $60,000. The plaintiff’s husband has a steady job and his income for the last financial year was $67,068. The plaintiff and her husband have combined superannuation of approximately $88,000.
The plaintiff has various credit card and other small debts. Apart from the mortgage, the other substantial liability of the plaintiff is for HECS. The amount currently stands at $26,800. That amount will presumably grow as the plaintiff continues her university studies.
A further consideration relates to her son Lachlan, who is now 10 years of age. He has been diagnosed with developmental and psychological conditions. Those include Asperger’s Disorder, ADHD and dyslexia. He requires a substantial amount of medical and para-medical care and treatment on a constant basis. The plaintiff’s evidence is that many of those costs are covered by Medicare, but there is a gap in the order of $3200 per year for Lachlan’s treatment and medication.
Lachlan’s medical conditions have necessitated him attending a school with a special education unit, to assist him with his learning difficulties. He attends such a school, but the school is a considerable distance from the plaintiff’s home. It is approximately 60 kilometres away, so there is a round trip every day of about 120 kilometres. The plaintiff drives her son to school. That in itself occasions significant cost. It will also restrict the ability of the plaintiff to earn income once she graduates from her university course, because she will only be able to accept employment on a part-time basis.
The defendant is 63 years old and works as a part-time telephonist. Her income is in the order of $28,000 per annum and she has an amount of approximately $40,000 in her superannuation account. The defendant is the registered proprietor of a residence at Belair, which has an estimated value of $450,000. The property is subject to a mortgage of about $90,000. Like the plaintiff, the defendant has various credit card and miscellaneous debts.
Legal issues
The plaintiff’s application is made pursuant to s 7 of the Act. That section provides as follows:
7—Spouse and persons entitled may obtain order for maintenance etc out of estate of deceased person
(1)Where—
(a)a person has died domiciled in the State or owning real or personal property in the State; and
(b)by reason of his testamentary dispositions or the operation of the laws of intestacy or both, a person entitled to claim the benefit of this Act is left without adequate provision for his proper maintenance, education or advancement in life,
the Court may in its discretion, upon application by or on behalf of a person so entitled, order that such provision as the Court thinks fit be made out of the estate of the deceased person for the maintenance, education or advancement of the person so entitled.
(2)Notice of an application under subsection (1) of this section shall be served by the applicant on the administrator of the estate of the deceased person, and on such other persons as the Court may direct.
(3)The Court may refuse to make an order in favour of any person on the ground that his character or conduct is such as, in the opinion of the Court, to disentitle him to the benefit of this Act, or for any other reason that the Court thinks sufficient.
(4)The Court may, in making any order under this Act, impose such conditions, restrictions and limitations as it thinks fit.
(5)If, in respect of an application under subsection (1) of this section, it appears to the Court that the matter would be more appropriately determined by proceedings outside the State, the Court may (without limiting the powers conferred on it by the preceding provisions of this section) refuse to make an order under this section or adjourn the hearing of the application for such period as the Court thinks fit.
(6)In making the order the Court may, if it thinks fit, order that the provision shall consist of a lump sum or periodic or other payments or a lump sum and periodic or other payments.
There is now more than 100 years of authority in relation to family provisions matters. The principles to be applied in determining a claim are well‑established and beyond any reasonable dispute. They may be stated as follows:
1The statute requires the Court to carry out a two-staged process. The first stage requires a determination of whether the applicant has been left without adequate provision. If that is decided in the affirmative, the Court is then required to determine what would be an appropriate provision.[3]
2The legislation is remedial in character and is to be construed to give the most complete remedy which the phraseology will permit.[4]
3The words “adequate” and “proper” are relative. The word “proper” connotes something different from the word “adequate”. It connotes an ethical position as to what allowance should be made. Adequate provision for proper maintenance is not limited to providing what is sufficient for basic subsistence.[5]
4The time for considering whether the applicant has been left without adequate provision is the date of the death of the testator.[6]
5Consideration of moral claims and moral duty are useful as a guide to the meaning of the statute and they connect the general value-laden language of the statute to community standards which give it practical meaning.[7]
6The provision which the Court may properly make is that which a just and wise testator would have thought it his or her moral duty to make had he or she been fully aware of all the relevant circumstances.[8]
[3]    Singer v Berghouse (1994) 181 CLR 201 at 208.
[4]    Worladge and Another v Doddridge and Others (1957) 97 CLR 1 at 9.
[5]    Bowyer v Wood (2007) 99 SASR 190 at 201.
[6]    Coates v National Trustees Executors and Agency Company Limited and Another (1956) 95 CLR 494.
[7]    Vigolo v Bostin and Others (2008) 221 CLR 191 at 204.
[8]    Re Allen (deceased) [1922] NZLR 218 at 220.
At first blush it might be thought that s 7(1) of the Act is setting out an economic test by which it is determined whether an applicant has adequate provision for her proper maintenance, education or advancement in life. Early on there was some support for treating the provision as simply being an economic provision concerned with whether sufficient provision for the reasonable maintenance and support of an applicant had been provided.[9]
[9] Re Greene’s Estate (1930) 25 Tas. L.R. 15.
However, ultimately it is the moral or ethical approach that has been accepted as the correct approach. That approach is made necessary by the use of the word “proper” in the statute. In Bosch v Perpetual Trustee Co Ltd[10] the Privy Council made clear that an economic approach to the interpretation of the section was not the correct approach. It found that a judgment as to the maintenance which is “proper” for a particular applicant in the circumstances of a case is necessarily a judgment as to what maintenance the applicant ought to have in the circumstances and not what he or she needs.[11]
[10] [1938] AC 463.
[11] Bosch v Perpetual Trustee Co Ltd [1938] AC 463 at 478.
The moral approach was approved by the High Court in Worladge and Another v Doddridge and Others[12] where Kitto J said:
What is proper is to be tested by reference to the provision which in all the circumstances of a case satisfies but does not exceed the requirements of moral justice in regard to those particular purposes. [13]
The purposes, of course, were provision for the proper maintenance, education and advancement in life.
[12] (1957) 97 CLR 1.
[13] Worladge and Another v Doddridge and Others (1957) 97 CLR 1 at 18.
What the Court has to determine is what the moral duty of the testator was at the time of her death. In determining whether or not an applicant has been left without proper provision it is necessary to have regard, to some extent, to what a proper provision would be. As Mason J said in White v Barron and Another[14] it is slightly artificial to say that the first test has to be determined before the second test, because the two tasks which face a judge are similar.
[14] (1979) 144 CLR 431 at 443.
Consideration of the issues
In considering whether the plaintiff has been left without adequate provision one needs to consider the position as at the time of the death of the testator. The Court also needs to determine what a wise and just testator would have done at that time with full knowledge of the relevant circumstances.
The relevant circumstances here are that the plaintiff is a person of modest means and has to support a child who, because of health issues, has special needs. The first question the Court has to determine is whether, where the testator left the plaintiff some jewellery and the sum of $2500 out of an estate of approximately $370,000, she satisfied her moral duty to her daughter.
This is a clear case. I cannot accept the contention of the defendant that the plaintiff has failed to satisfy the first test. The proper moral claim of the plaintiff has not been satisfied by the small bequest left to her in the will. The testator has preferred the interests of one of her siblings over her child. In Bowyer v Wood the Court held that it was inappropriate, without good reason, for the testator to prefer the interests of siblings over a child. That was regarded as a failure of moral duty.[15] There is no evidence as to why the testator has preferred her sibling over her child. The deceased and the defendant had a close relationship. That aside, there is nothing to suggest it was appropriate to so significantly prefer her over the plaintiff.
[15] Bowyer v Wood (2007) 99 SASR 190 at 205.

It might be on the evidence that she did not intend to do so. At the time the will was made, the testator had very few assets. It may be that the outcome has been distorted by the fact that after the preparation of the will the testator was left the residential property by her partner.
There is no doubt that the plaintiff has been left without adequate provision. As the Privy Council said in Bosch, the task of exercising the power to award further provision will always be one of great difficulty and delicacy. It must always be one largely of guesswork.[16]
[16] Bosch v Perpetual Trustee Co Ltd [1938] AC 463 at 483.
I am conscious of the fact that there are only two claimants on this estate and that an increased provision for the plaintiff will reduce the provision going to the defendant. The defendant, like the plaintiff, is in modest financial circumstances. She only works part-time and, because of her age, is unlikely to work for a long period into the future. Nonetheless, the Court has to determine an adequate provision for the plaintiff.
The function of the Court is to alter the disposition made by the deceased only to the extent necessary to make proper provision for the plaintiff.[17] The Court is not entitled to re-write the will in accordance with any notion of general fairness. There is never a precise answer to the question of what is adequate provision. The Court has to do the best it can, having regard to all of the circumstances under consideration. One factor here that has to be considered is the fact that the plaintiff has a young child to support and educate. That is a relevant consideration.[18] The fact that a child has special needs makes it a more important consideration.
[17] Ahearn v Ahearn [1917] St R Qd 167 at 170.
[18] Goodman v Windeyer and Others 144 CLR 490 at 498.
In my opinion, a proper provision for the plaintiff would be 55 per cent of the residue of the estate of the deceased. It is appropriate that the plaintiff retain the jewellery bequeathed to her in the will. I would substitute for the bequest of $2500 a provision equalling 55 per cent of the residue of the estate of the deceased.
Conclusion
I grant the plaintiff’s application. I propose to order, pursuant to s 7 of the Act, that in lieu of the bequest of the sum of $2500 to the plaintiff provided in the deceased’s will, the plaintiff is to receive an amount equal to 55 per cent of the residue of the deceased’s estate. The parties are to bring in to Court minutes of order that reflect that conclusion.
I will hear the parties further on any other issues.