Ikonomou v Panagopoulos

[2017] NSWSC 1805

Supreme Court

New South Wales

Medium Neutral Citation:	Ikonomou v Panagopoulos [2017] NSWSC 1805
Hearing dates:	17 October; 22 November 2017
Date of orders:	22 December 2017
Decision date:	22 December 2017
Jurisdiction:	Equity - Family Provision List
Before:	Parker J
Decision:	Proceedings dismissed
Catchwords:	Succession – family provision claim by widower – house owned by deceased and widower in equal shares as tenants in common – whole of deceased’s estate left to granddaughter of deceased – dysfunctional relationship between deceased and widower – long-standing testamentary intention of deceased for share in house to remain in her family – known to widower – “community expectations” as to “proper” provision for widower
Legislation Cited:	Succession Act 2006 (NSW), s 57(1)(d)
Cases Cited:	Bladwell v Davis [2004] NSWCA 170 Jagoe v Maguire [2013] NSWSC 1283 Luciano v Rosenblum (1985) 2 NSWLR 65 Marshall v Carruthers [2002] NSWCA 47 Slack v Rogan; Palffy v Rogan (2013) 85 NSWLR 253; [2013] NSWSC 522 Taylor v Farrugia [2009] NSWSC 801
Category:	Principal judgment
Parties:	Manuel Ikonomou (Plaintiff) Anastasia (Nancy) Panagopoulos (Defendant)
Representation:	Counsel: M Lawson (Plaintiff) DD Knoll AM (Defendant)   Solicitors: H Danalis & Co (Plaintiff) Laliotis Lawyers (Defendant)
File Number(s):	16/334914
Publication restriction:	Nil

Judgment

1. This is an application for provision out of the estate of the late Helen Ikonomou who died in June 2016 at the age of 83. For convenience, and without disrespect, I will refer to the members of the deceased’s family by their Christian names.

2. The deceased was born in Greece in August 1932. The deceased and her first husband had one child, Anastasia (known as Nancy) Panagopoulos. The deceased and her first husband had separated by 1974, leaving the deceased with custody of Nancy.

3. The plaintiff, Manuel (also spelt Manouel) Ikonomou, was the deceased’s second husband. He was born in Greece in November 1949 and was therefore 17 years younger than the deceased. They married in August 1977. They had no children together.

4. By her last will, made in February 2014, the deceased appointed Nancy (who is the defendant in the proceedings) as her executrix and left the whole of her estate to Elena Shannon Panagopoulos, who is Nancy’s daughter and thus the deceased’s granddaughter. The net value of the estate is approximately $700,000.

Factual findings

5. Manuel swore a number of affidavits in support of his case and was cross-examined. He has limited education, having left school in Greece at the age of 13. Even making allowances for this, his evidence was unsatisfactory in a number of respects which I address in more detail below. His answers were frequently non-responsive. It may be that this was in part a result of limited education and his lack of command of English. But even if that is so, it does not assist his reliability as a witness. Overall, I approach his evidence with considerable caution.

6. Nancy was the main witness in the defence case. She swore a number of affidavits and was cross-examined at some length. She was at times argumentative but I thought her evidence was generally straightforward. However, the evidence in the case shows that there is, and for a long time has been, antipathy between Manuel and Nancy. It appears that Manuel resented what he saw as Nancy’s interference and, for her part, Nancy believed Manuel did not treat her mother as he should have. Whether or not Nancy’s view of Manuel is justified (about which I say more below), I think that her antipathy towards him may have coloured her evidence to some degree, leading her to exaggerate Manuel’s faults and to play down matters which were favourable to him. Nevertheless, I thought her evidence was generally reliable.

7. Nancy’s daughter, Elena, swore a number of affidavits and was cross-examined. I see no reason not to accept her evidence as far as it went. A friend of Nancy’s, Nancy Vazlas, also swore an affidavit and was cross-examined concerning an incident in May 2015 when she and Nancy visited the deceased’s house to clean it up. I refer to this in more detail below. Again, I accept her evidence so far as it went.

Deceased’s family life and relationships

8. According to Manuel, he first met the deceased in 1974. At that time she was living in a house in Erskineville with Nancy. There is no direct evidence of Nancy’s date of birth. According to Nancy’s affidavit, she was 17 when the deceased and Manuel were married, which would mean she was born between August 1959 and August 1960. Manuel, however, said that when he first met the deceased in 1974 Nancy was about 11, which would mean that she was born in about 1963.

9. According to Manuel, he and the deceased purchased a unit at Kogarah in 1975. He said he moved in with the deceased and Nancy in 1976. At this time, he was aged about 26, the deceased was aged about 43 and Nancy was aged about 16 (on her evidence) or about 13 (on Manuel’s). Manuel said that, also in 1976, the Erskineville property was “taken over” by the company which had financed the purchase because the mortgage payments were in arrears. Although he did not expressly say so, this presumably meant that the deceased, Manuel and Nancy then moved to the Kogarah unit.

10. Nancy offered a slightly different chronology. She said that the deceased and Manuel started living together at Erskineville in 1975 and then purchased the unit at Kogarah and moved there. The mortgage payments on the Erskineville property could not be sustained and it was sold. This seems a more logical sequence of events.

11. The deceased and Manuel were married on 15 August 1977. In about 1978, the deceased fell pregnant but miscarried. She did not become pregnant again.

12. In 1979, the deceased and the plaintiff purchased a house at Cronulla and moved there with Nancy. The property at Kogarah was sold.

13. According to Nancy, she moved out of home at the age of 23. This would have been in about 1983 (on her evidence) or about 1986 (on Manuel’s). Elena was born in March 1992. Nancy had another daughter, but the evidence identifies nothing more about her than her name, Angelique. Nancy said that she remained in regular contact with her mother, visiting her regularly at the Cronulla property.

14. Nancy gave evidence, based on what she said she had been told by the deceased and also, to some extent, on her observations of the deceased’s life with Manuel, that their relationship was dysfunctional. According to Nancy, they quarrelled frequently and there were long periods of time when they did not talk to each other; for many years they had in effect been living separate lives.

15. Nancy said that Manuel slept in a separate bedroom. She said that the deceased had told her that Manuel dressed in women’s clothing and had sex with men and that she (the deceased) was disgusted by this behaviour.

16. For 12 or so years between about 2003 and about 2014 (after which the deceased’s health did not permit it), the deceased spent six to seven months of the year living in Greece (presumably in one of the units she owned at Piraeus: see [48] below) while Manuel continued to live at the Cronulla property. According to Nancy, the deceased told her she made these trips to Greece as an escape from living with Manuel.

17. Nancy also said that Manuel was a “major hoarder” and filled the house with rubbish and junk. She said that the deceased was reduced to living in the kitchen and her bedroom.

18. Nancy also gave evidence that the deceased had expressed a lack of trust in Manuel with respect to financial matters. Nancy said that the deceased’s bank statements were sent to Nancy’s address from about 2005. In November 2012, the deceased executed an Enduring Power of Attorney in favour of Nancy. According to Nancy, the deceased said at the time that she did not trust Manuel and would never give him the right to sign anything on her behalf, for fear that if she did he might sell the house and leave her in the street.

19. The deceased suffered from health difficulties in the latter part of her life. For at least a decade, she suffered from macular degeneration which severely affected her eyesight. She also had a heart condition and underwent open-heart surgery twice. In April 2015, the deceased suffered a major stroke and was hospitalised.

20. Nancy and Ms Vazlas gave evidence of coming to the house in May 2015 and finding it in a state of utter squalor. They described removing several skips of junk (which resulted in a confrontation with Manuel) and also described the kitchen being in a filthy state, dead rats in another room and droppings throughout the living room from pet birds kept by Manuel.

21. The deceased suffered a further major stroke in June 2015. In August, approval was given for her to receive respite care but she was then returned to hospital with chest pain and hypertension, before being discharged home on 10 September.

22. The deceased’s discharge from hospital and return to the Cronulla property precipitated open conflict between Nancy and Manuel. Nancy believed that her mother was living in squalor and Manuel was either unwilling to look after her properly or incapable of doing so. Nancy made attempts to look after the deceased at her own house but the deceased wandered away from the house at night and was at risk from internal stairs; Nancy concluded it was impracticable and the deceased was returned to the Cronulla property.

23. On 10 September, Nancy had filed an application with the New South Wales Civil and Administrative Tribunal to have a guardian appointed for the deceased. On 25 September, Manuel filed a cross-application for the appointment of a guardian and the appointment of a financial manager and also for a review of Nancy’s Power of Attorney.

24. A report prepared for the Tribunal from the social worker allocated to the deceased’s case from September 2015 was in evidence before me. The report records a number of visits to the deceased and Manuel at the Cronulla property in October, as well as the social worker’s dealings with Manuel and Nancy. The report records that on 28 September the social worker was advised by Nancy that she would be seeing a solicitor to arrange putting a caveat on the Cronulla property:

… as she was concerned after her mother had continued to mention the will to her that she may be under some pressure from [Manuel] to change her legal arrangements.

25. The caveat was subsequently lodged in October. In her affidavit, Nancy recorded that the caveat resulted from a prior conversation with the deceased:

She said to me on one occasion (in one of her lucid moments) words to the effect:

“Manuel has brought papers to the hospital for me to sign. I don’t know what they are for and I am very worried he is trying to transfer my share of the house into his name now that I’m in here and not well”.

I said:

“Don’t worry mum I am going to see a solicitor and see what I can do to stop him from doing anything like that”.

26. On 9 November, the Tribunal made an interim order for the appointment of the Public Guardian as guardian of the deceased. On 2 December, the Tribunal extended the order for a year, on the basis that the deceased was unable to look after her own interests and needed protection. But the Tribunal considered that there was no reason to interfere with the Power of Attorney in favour of Nancy. The Tribunal dismissed Manuel’s application for review and for the appointment of a financial manager.

27. The deceased was readmitted to hospital in November 2015 and then transferred to a nursing home at Illawong. Her health deteriorated and in May or early June 2016 she was moved to hospital. She died later in June.

28. Manuel in his evidence disputed Nancy’s characterisation of his relationship with the deceased. He acknowledged that, like any married couple, they had had their difficulties, but he maintained that it was a close and loving relationship up to the end. He said that they regularly attended church together in Sydney and also attended family gatherings involving his relatives; he produced a photograph of the deceased at a christening in Darwin to support this. He also said that they went camping together until “about 2012” and that the deceased came fishing on the Manuel’s boat (see [52] below), again producing photographs to support this.

29. Manuel said that the state of the house was not as bad as Nancy portrayed it and that the deceased herself had contributed to the mess and clutter. He denied that he dressed in women’s clothing or had sex with men. He maintained that he and the deceased continued to share a bed to the extent that the deceased’s medical difficulties made that possible.

30. It is distasteful for the Court to go into these intimate matters. But they go to the nature of the relationship between the deceased and Manuel and are therefore relevant, so the Court has no choice but to make findings on them.

31. Manuel’s evidence that he and the deceased attended church, social functions etc was not disputed and I accept it so far as it goes. But Manuel did not deny that the deceased went overseas for half a year or more for the last 12 years or so of her life.

32. Although, as I have said, Manuel maintained that he and the deceased continued to share a bed, I found Nancy’s evidence to the contrary more persuasive. I am satisfied that she had ample opportunity to observe this during her visits to the house. It was suggested that her observations were only momentary and did not exclude the possibility that at other times cohabitation had resumed, but, while that is theoretically possible, I do not find it plausible. Elena also gave evidence of visiting the house and sleeping in her grandmother’s bed while Manuel slept elsewhere and her evidence was not challenged on this point.

33. Nancy gave evidence of herself seeing women’s clothing and makeup in the room which Manuel used. She gave clear and convincing testimony that the clothes and makeup were not her mother’s. In the Centrelink form to which I refer below, Manuel acknowledged that there was no sexual relationship between him and the deceased, at least by October 2015. He explained this in evidence as being the result of the fact that he had a sexual disease and did not wish to infect the deceased during intercourse. But he gave no background evidence identifying when he contracted the disease or how. While reticence in the circumstances would usually be understandable, the fact is that it was an issue in the proceedings and Manuel’s evidence on this subject consisted of nothing more than a bald denial. On balance, I accept the deceased’s complaints (relayed through Nancy’s evidence) of Manuel’s sexual conduct and the disgust which this produced in the deceased.

34. Nancy’s evidence as to the state of the house in May 2015 was corroborated by Ms Vazlas. This was also consistent with the observations recorded by the social worker in her visit in October 2015 referred to below. Although those observations demonstrated some improvement, it was only marginal. I accept that Manuel’s failings in this regard went beyond merely annoying or inconsiderate behaviour which might be found in any marriage, and demonstrated a complete lack of respect on his part for the deceased’s dignity and comfort.

35. Bank statements of the deceased addressed to the deceased at Nancy’s address are in evidence, and the execution of the Power of Attorney in favour of Nancy in 2012 is an accepted fact. This does provide objective support for Nancy’s evidence that the deceased did not trust Manuel, or at least did not wish him to be involved in her financial affairs.

36. In 1992, when she turned 60, the deceased retired from work and began to receive the age pension. The pension was paid to her at the rate applicable for a divorced or separated person. The application was not in evidence, but it was common ground that the deceased had described herself as being separated from Manuel, albeit living under the same roof.

37. On 27 October 2015, while the Tribunal proceedings were still pending, Manuel lodged with the Commonwealth Department of Human Services a form entitled “Relationship details separated under one roof” in the deceased’s name. The form bears a barely recognisable signature by the deceased but the form itself was completed by Manuel on the deceased’s behalf. Such a form is apparently used where somebody who is receiving Centrelink benefits on the basis of having been divorced or separated has resumed cohabitation with their former partner. The questions on the form were answered to the effect that the deceased and Manuel were living as a normal married couple albeit that there was no sexual relationship between them. Question 11 asked:

How has your relationship changed since you separated?

38. Manuel answered this question on the deceased’s behalf as follows (with spelling corrected):

I love Manouel. I was [stubborn] and [since] I [lose] my vision I [came] back to Manouel.

39. Manuel was cross-examined about the circumstances in which he completed the form. He said that the form had been sent out by Centrelink of its own accord, without any prior request. He said that, although he completed the form, the instructions in it were from the deceased and that he merely wrote down what she said. When pressed on this, he averred that at the time the deceased was still capable of speaking in sentences, despite her earlier strokes. Manuel also said in one of his affidavits that when the deceased reached the age of 60 in 1992 she said that she wanted to get the pension but that he replied that he was still working. Counsel for Manuel asked me to infer that the deceased had described herself as separated only in order to qualify for the pension.

40. I do not accept this evidence or counsel’s submission. I find it incredible to think that Centrelink would have provided Manuel with the form otherwise than in response to a request, and the only person who could plausibly have made such a request would have been Manuel himself. The report by the social worker who saw the deceased in October 2015 shows that at that stage the deceased was in a pitiable state. The social worker reported that during her visits the deceased remained very quiet. When asked direct questions she appeared to be only able to say a few words. At times the deceased appeared to be very uncomfortable with the conversation and at times she would moan while Manuel was talking. At other times she appeared very tired and went back to bed. The social worker said it was very difficult to ascertain what the deceased’s wishes were. Nancy’s evidence of her conversation with the deceased during a “lucid interval” in late September has the deceased speaking in sentences and rationally, but any tension between this and the social worker’s observations was not explored in cross-examination. I do not believe that the form was based on coherent instructions from the deceased as Manuel claimed.

41. In itself, this is a serious blow to Manuel’s credibility; but the statement in the form about reconciliation has a further significance for this case. Making all allowances for Manuel’s lack of education and lack of command of English, what Manuel wrote on the form is a clear acknowledgement by him that he and the deceased had previously been separated albeit living (when the deceased was not in Greece) under the same roof. The fact that the form describes the deceased as having come back to Manuel after she lost her vision is still not consistent with the denials made by Manuel: his sworn evidence was to the effect that they had never been separated. There is no evidence to support a reconciliation at this time and I do not believe that one happened.

42. There is in fact no evidence before me that in 1982 the deceased could only have qualified for an age pension if she was separated, and I would be most reluctant to find that the deceased had in effect been defrauding the social security system when she is not here to answer that allegation. In any event, the answer to question 11 on the form represents an admission on the part of Manuel that he and the deceased were previously separated. I am driven to the conclusion that Manuel, perceiving the difficulties which his separated status presented in challenging Nancy’s position under the Power of Attorney, fabricated the form.

Deceased’s financial affairs

43. The deceased worked as a process worker until she retired in 1992. According to Nancy, from 1975 the deceased also worked as a cleaner as a second job, but, according to Manuel’s affidavit, she gave this up following diagnosis of a heart condition in 1974 (this date may be a mistake). There is no evidence of her earnings but she is unlikely to have had a great deal of disposable income.

44. According to Manuel, the deceased had paid $22,000 to buy the Erskineville property, although the source of this information was not stated. He said that the Kogarah unit cost $27,200.

45. LPI records confirm that the purchase of the Cronulla property took place in May 1979. The purchase price was $48,500. The property was purchased by the deceased and Manuel as joint tenants. Approximately three months later, the tenancy was changed to a tenancy in common in equal shares.

46. There is limited evidence on the respective financial contributions of the deceased and Manuel to the Erskineville, Kogarah and Cronulla properties, and the evidence was to some extent conflicting.

47. Manuel accepted that the deceased had already purchased the Erskineville property when she commenced her relationship with him. However, he claimed that he contributed to paying off the mortgage and also made a capital payment of approximately $5,000 to paying down the mortgage. He also claimed that he contributed to the mortgage payments for the Kogarah property. Nancy said that she provided $1,500 to the deceased to assist in the purchase of the Kogarah property, and he did not contribute. Manuel also said that he contributed to the mortgage payments on the Cronulla property and the mortgage was “paid” (meaning, I understand, that the balance of the purchase price was paid off) in about 1988 with a redundancy payment he had received. There is no documentary evidence which would confirm any of these alleged contributions.

48. The deceased also owned a house in Greece, at Piraeus. Subsequently, she made arrangements with a builder for the property to be redeveloped into a block of units. Apparently, the deceased contributed the land and the builder financed the construction; the deceased was left with three units in the building.

49. As I have mentioned, the deceased retired from her work in 1992 when she turned 60. From that point onwards she received an age pension.

50. Among the bank account statements addressed to the deceased at Nancy’s house is a statement from 2015 for an account in the deceased’s sole name which shows her pension receipts and various items of household and personal expenditure. Nancy’s evidence was that, in fact, the deceased had had her own separate personal bank account from about 1995. This evidence was not challenged and I accept that the deceased and Manuel kept their financial affairs separate from the mid-1990s at the latest.

51. In 1993, Manuel decided to set himself up as a sub-contract truck driver. He organised to purchase a semi-trailer for $18,000. The semi-trailer was purchased in his and the deceased’s names and the money to buy it was borrowed by them jointly as well, apparently by way of drawing or advance on a joint mortgage account. Manuel operated his sub-contracting business for about five years until 1998 when the semi-trailer was sold for $12,000.

52. In about 2003, $150,000 was borrowed on a joint mortgage account for the purchase of a fishing boat which Manuel contemplated using for the conduct of a professional fishing business. The venture was not successful as a business but the boat was retained, essentially it would seem for Manuel’s use.

53. Manuel’s personal bank statements from November 2013 onwards and the statements for the joint mortgage account from January 2014 onwards were tendered on Manuel’s behalf. They showed that from January 2014 regular withdrawals were made from Manuel’s personal account so as to meet the mortgage repayments. The evidence also shows that in August 2015 Manuel used a superannuation payout of approximately $72,000 to pay off the remainder of the debt.

54. The evidence does not however establish how the loan repayments were funded prior to January 2014. This is a somewhat surprising omission. There would appear to be no reason why bank records could not have been obtained going back at least as far as 2010. More importantly, the evidence does not establish that the loan payments produced any overall benefit for the deceased. As I have mentioned, Manuel’s own evidence is to the effect that the loan taken out to purchase the Cronulla property was repaid as long ago as 1988. The loan paid off by Manuel derived from the purchase of the boat. The boat was apparently always registered in Manuel’s name and he retains ownership of it, although it appears now to have relatively little value (according to Manuel, approximately $10,000 although he has it on the market for $50,000). The decision to purchase the boat appears to have been Manuel’s and there is no evidence the deceased received any significant financial benefit from it.

55. In his initial affidavit, Manuel said that he and the deceased always shared household expenses. The maintenance of separate bank accounts is not, of course, inconsistent with this; but it makes it difficult to assess how much of the parties’ personal expenditure truly represented expenditure from which they commonly benefited. For instance, it appears that Manuel has incurred significant expenditure over the years on the boat but this does not appear as if it should really be treated as common expenditure.

56. Manuel’s evidence was that he also undertook some works on the Cronulla property which were jointly funded, including the laying of concrete and the construction of new sheds. Nancy in her affidavit said that the deceased paid for major roof repairs at a cost of $10,000 and for the painting of the exterior of the property. But Manuel said he paid $15,000 for the roof repairs and that he (and friends) painted the property. Neither Manuel nor Nancy was cross-examined on this and, accordingly, I am unable to resolve this conflict.

Deceased’s testamentary arrangements

57. I have already referred to the arrangement between the deceased and Manuel which resulted in the Cronulla property being put into ownership as tenants in common from August 1979. The obvious inference is that the deceased wished to avoid the possibility that if she predeceased Manuel, he would receive the whole property by survivorship, leaving Nancy with nothing.

58. A will made by the deceased in August 1999 is in evidence. Under the will, the deceased appointed Nancy as executrix and trustee. She left the funds invested at the Sutherland Credit Union for her granddaughter, Elena, on turning 18. She left the residue of her estate to Nancy, providing that in the event that Nancy predeceased her it would be left equally to her granddaughters, Elena and Angelique. The only provision made in favour of Manuel was that, should he survive her by thirty days, he would have the right to occupy the Cronulla property for a period of six months following her death before realisation of her share of the property.

59. There is no evidence before me of any earlier will, but I infer from the tenancy in common arrangement for the Cronulla property that the deceased would have intended from 1979 that half the property would pass to Nancy, and she may well have made an earlier will to effect this.

60. There is also in evidence before me the translation of a Greek will, made in Piraeus in August 2007. The will referred to the deceased as owning three apartments in an apartment building and designated Nancy as the heir to two of those and Elena as the heir to the other one. All Greek movables were left to Nancy.

61. In June 2010, the deceased transferred two of the units at Piraeus to Nancy (presumably those identified as being left to Nancy in the Greek will). Nancy estimated the value of the units as $40,000 each.

62. I have already referred to the deceased’s last will, which was made in February 2014. The will contained the same appointment of Nancy as executrix and direction that Manuel was entitled to occupy the Cronulla premises for a period of six months after the deceased’s death. In lieu of the previous provision in favour of Elena (as to the bank accounts) and Nancy (as to the residue), the will left the whole of the estate to Elena with no gift over. The will contained the following further notation:

I NOTE that in making this my Will I have borne in mind the interests of my husband, and state that he is to take no part in my Estate, other than the right of occupancy mentioned in Clause 3 hereof.

63. Nancy gave evidence as to the circumstances in which the will came to be made. Nancy said that she was experiencing marital difficulties and the deceased expressed concern at the possibility that her husband might indirectly benefit from the gift to Nancy under the then existing (1999) will. According to Nancy, the deceased asked her to make arrangements with her solicitor for a new will. Nancy said that she attended the conference with the solicitor, acting as interpreter between the solicitor (who spoke English) and the deceased (who mainly spoke Greek).

64. Counsel for Manuel suggested in cross-examination that there was something untoward about Nancy’s account of what happened and that it had been inappropriate for her to act as interpreter. I reject this suggestion. There is nothing whatever in the evidence to suggest that the will in 2014 did not reflect the deceased’s intentions. For present purposes, the will’s provisions were the same as those of the previous will which had been prepared by the same solicitor for the deceased. There is, in my opinion, nothing whatever improper about the way in which the 2014 will was prepared.

65. Manuel must, of course, have agreed for the Cronulla property to be put into the joint ownership of himself and the deceased as tenants in common before that happened in August 1979. His evidence on this in cross-examination was not easy to follow but he did agree that the deceased proposed it and that she did so in order to ensure that her half of the property went to Nancy.

66. In his initial affidavit, Manuel said that the deceased had made “a number of statements” to him about her testamentary intentions. He said that the last of these was in about April 2015. The deceased told him that she had made her will leaving her half of the house to Elena but that he would be able to live in the house for as long as he lived and that he would also be able to live in the property in Greece for as long as he wished. In the Centrelink form prepared by Manuel in October 2015, he disclosed on behalf of the deceased that she had not nominated him as a beneficiary under her will.

67. It is clear on Manuel’s own evidence that the deceased discussed her testamentary intentions with him. In fact, her testamentary intentions never involved Manuel having a right of residence any longer than six months. I do not believe the deceased told Manuel that he would be able to live at either the Cronulla property or in Greece for the rest of his life if he survived her. To the contrary, I think that Manuel was well aware, probably from 1979 onwards, that the deceased intended to leave her half share of the Cronulla property (as well as her interest in the Greek property) to her own family and not to him.

Estate assets and liabilities

68. Steps have been taken to transmit the remaining unit in Piraeus to Elena in accordance with the provisions of the Greek will. According to Manuel, the value of the unit is €90,000 to €100,000 ($140,000 to $155,000). But according to Nancy, given the economic depression in Greece, it would be worth only $30,000 or so. There is no independent evidence on the question.

69. Probate of the deceased’s Australian will was granted by this Court to Nancy in October 2016.

70. The deceased’s principal Australian asset was her half share in the Cronulla property. A valuation of that property is in evidence; the value given, which is accepted by both parties, is $1.6 million, and accordingly the value of the deceased’s share is approximately $800,000.

71. Nancy’s affidavit as executrix also discloses a Toyota motor car as belonging to the deceased. It has apparently been registered in the name of Manuel and there was some debate before me as to its true ownership; however, it is not necessarily to resolve this. The car apparently has little value and Nancy, on behalf of the deceased’s estate, is prepared to leave it with Manuel whether or not he is, strictly speaking, entitled to it. There is no reference to any bank accounts in either the inventory of property or Nancy’s affidavit.

72. According to Nancy, the deceased’s funeral and burial expenses were approximately $36,600. There were also probate costs of approximately $3,300. These were paid by Nancy and have not been reimbursed, there being no funds in the estate to do so. Nancy’s costs of these proceedings as executrix were estimated as approximately $45,000 but this was before a second day of hearing became necessary, for which I add $15,000 to the estimate. The net value of the Australian assets in the estate is therefore approximately $700,000.

73. Nancy gave evidence that she asked Manuel to contribute half the costs of the deceased’s funeral and burial expenses but he refused. Manuel did not deny the request but said he lacked any funds and was unable to pay. Counsel for Nancy criticised Manuel and suggested that this was further evidence of a lack of respect or regard for the deceased. I do not agree. Both legally and morally, the deceased’s funeral and testamentary expenses fall on the residue of her estate. There was no obligation on Manuel to contribute to the costs as there are ample assets in the residue of the estate to meet them (Manuel, by his counsel, properly concedes that the deceased’s funeral and testamentary expenses and the costs of defending these proceedings should be fully satisfied out of the deceased’s Australian assets before any provision is made in his favour: see [87] below).

Plaintiff’s circumstances

74. Manuel is now 68 years old and resides at the Cronulla property. As I have said, he attended school in Greece until the age of 13, when he came to Australia. During cross-examination, he indicated he had done some study since arriving in Australia “with interpreters”, presumably in relation to the English language, but no further details were elicited.

75. There is in evidence a short medical report of a consultant cardiologist from September 2017 which says that Manuel has an “ongoing serious cardiac condition … that requires ongoing treatment, assessment and follow up”. Manuel also said he has type-two diabetes and high blood pressure, for which he takes daily medication. He also claimed to suffer from depression and anxiety. This was referred to by the cardiologist, but the only direct evidence to support it was a medical certificate from April 2017 stating that Manuel is suffering from “severe depression and anxiety secondary to his current situation” and advising that his accommodation should be “private and quiet, and relatively free from surrounding disturbance and noise”. The terms of this statement were too general to be of any weight, especially as the “current situation” is not defined.

76. Manuel has spent the majority of his working life as a semi-trailer driver (since 1993) and as a taxi driver (since 1978), although there appear to have been several periods of unemployment in between. He has also worked for New South Wales Railways as a truck driver for about 15 years and, prior to marrying the deceased, as a driving instructor. He stopped work in mid-to-late 2015 and is now in receipt of the age pension (apparently since January 2016, with payments being backdated to September 2015) in the sum of $808 per fortnight. He also receives an energy supplement of $14 and a pension supplement of $66 fortnightly. On my calculations, his monthly income is less than $1,800 and generates approximately $21,300 annually.

77. Manuel estimated his monthly expenditure to be $2,300 ($27,600 annually). These expenses include approximately $480 for rates, telephone and electricity, $600 for food, $160 in medical expenses and $440 for various expenses associated with his boat (some of which had not been included in his earlier affidavit evidence). Manuel also said that he is paying $40 per fortnight in order to repay an advance of $1,500 made by Centrelink for the purpose of disbursements in these Court proceedings. A Centrelink Income Statement dated 16 October 2017 shows that this deduction has now ceased.

78. The value of Manuel’s half share in the Cronulla property is $800,000. According to his October 2017 affidavit, he also has furniture and household effects amounting to $3,500, the Toyota motor car which he valued at $1,500 and his boat (independently valued at $10,000 in October 2017). Evidence tendered at the hearing, which I referred to earlier, demonstrated that in August 2015 Manuel put the entirety of his superannuation ($72,000) towards discharging the mortgage.

79. Manuel’s solicitor’s affidavit of October 2017 estimated his total legal costs incurred and to be incurred, calculated on a solicitor/client basis, to be $43,600 (inclusive of counsel’s fees and disbursements). But, as mentioned with respect to Nancy’s costs as executrix, this estimate was provided before the second day of hearing became necessary. The affidavit also said that Manuel has paid $1,500 towards his costs.

Beneficiary’s circumstances

80. Elena is currently aged 25. She lives at home with her parents, Nancy and Bill, in Kirrawee, New South Wales.

81. According to her affidavit of February 2017, she has been casually employed by the Department of Immigration and Border Protection and receives $760 after tax per week ($39,520 annually). During cross-examination, she said the position primarily involves data entry and that the hours vary, although she might work up to 38 hours in “a good week”. When asked whether she is looking for a more permanent position, Elena responded that she is “taking each day as it comes”.

82. She said she has $2,000 in monthly expenses ($24,000 annually), which includes $600 for entertainment, $450 in car expenses and $750 for food and utilities (which would seem to suggest she contributes to the payment of bills at her parents’ house).

83. Elena’s assets include a Suzuki motor car valued at $10,000, jewellery and personal effects worth $2,000 and superannuation in the sum of $5,300 (as at August 2016). Annexed to her affidavit was a bank statement showing less than $3 in savings, but the statement was only a summary and included no transaction history. She either has or will have the unit in Piraeus but, as mentioned, there is no independent evidence as to its value: see [68] above.

Entitlement to family provision order

84. As the widower of the deceased, Manuel is an eligible person: Succession Act2006 (NSW), s 57(1)(d).

85. The starting point for the submissions made by counsel for Manuel is the following statement by Powell J (as his Honour then was) in Luciano v Rosenblum (1985) 2 NSWLR 65 at 69-70:

It seems to me that, as a broad general rule, and in the absence of special circumstances, the duty of a testator to his widow is, to the extent to which his assets permit him to do so, to ensure that she is secure in her home, to ensure that she has an income sufficient to permit her to live in the style to which she is accustomed, and to provide her with a fund to enable her to meet any unforeseen contingencies.

86. Counsel submitted that what Powell J said should be recognised as being equally applicable to a surviving widower as to a surviving widow. Counsel referred to Jagoe v Maguire [2013] NSWSC 1283 at [137(a)] where Hallen J repeated Powell J’s statement in gender neutral language.

87. As mentioned, the deceased’s funeral and testamentary expenses were paid by Nancy who is entitled to be reimbursed for that expenditure. The costs of defending these proceedings will also need to be paid out of the estate. Counsel for Manuel accepted that the only asset in the Australian estate which is capable of being realised so as to meet these liabilities is the deceased’s half share of the Cronulla property. Counsel did not suggest that such liabilities should be met out of the deceased’s remaining asset in Greece: cf Taylor v Farrugia [2009] NSWSC 801 at [26], [74]. Counsel accepted that the deceased’s funeral and testamentary expenses, including the costs of defending these proceedings, would have priority over any provision which might be made in favour of Manuel out of the deceased’s Australian assets. At one point, counsel mentioned the possibility of Manuel, should he succeed in obtaining an order for provision, obtaining a reverse mortgage to pay out the liabilities, but in the end he invited me to deal with the case on the basis that, irrespective of the result, the Cronulla property would have to be sold.

86. In his affidavit evidence, Manuel said that he had “looked around Cronulla” and had not been able to find a house priced below $1.7 million. He attached a list of three houses recently sold in the Cronulla area. He said that he had looked at two bedroom home units and townhouses in the Cronulla area which were priced between $850,000 and $950,000.

87. Counsel for Manuel pointed to the fact that he has now retired and has no realistic prospect of future earnings beyond the age pension whereas Elena is a young woman at the beginning of her work career. Counsel submitted that Manuel’s needs were far greater than any needs Elena might have. He relied on the following remarks of Ipp JA in Bladwell v Davis [2004] NSWCA 170 at [2]:

… where competing factors are more or less otherwise in equilibrium, the fact that one party is the elderly widow of the testator, is permanently unable to increase her income, and is never likely to be better off financially, while the other parties are materially younger and have the capacity to earn more or otherwise improve their financial position in the future, will ordinarily result in the needs of the widow being given primacy. That is simply because, in such circumstances, the widow will have no hope of improving herself economically, whereas that would not be the position of the others. In that event, the need of the widow would be greater than that of the others.

90. Counsel’s submission was that, in the circumstances, the proper provision for Manuel was that he should receive 100% of the Australian estate (net, of course, of the funeral and testamentary expenses and legal expenses).

91. I do not accept the premises upon which counsel rested his submissions. In Marshall v Carruthers [2002] NSWCA 47, a case of a claim by a surviving de facto spouse against the deceased’s ex wife, to whom he had left his estate on trust for their son, Hodgson JA (with whom Young CJ in Eq and Palmer J agreed) said:

63.   .. the strength of a claim of a surviving partner does, in my opinion, vary with circumstances. … In my opinion also, the strength of a claim can be affected by the length of a relationship and contributions to the relationship. One factor which may be particularly important in a claim by a woman is that woman may have, to the detriment of her own financial prospects, taken a major role in raising the children of herself and the deceased.

…

65.   I do not think it is to be assumed that [the statement of Powell J from Luciano v Rosenblum] is to apply in all cases, particularly where factors such as those I have mentioned are absent. In my opinion, it is not clear that this statement would apply to applications by widowers. The difference in attitude that the Court may take to applications by widowers is due in part, I think, to economic disadvantages which women still face. One important aspect of this is the economic disadvantage occasioned by the greater responsibility which women often take in looking after children. That factor is of course absent here.

92. In the past, family arrangements where the husband was the breadwinner and the wife stayed at home as homemaker and looked after the children were commonplace, if not the norm. Frequently, the matrimonial home would be acquired in the name of the husband and family provision questions arose where the death of the husband left the wife as a widow who was at or approaching retirement age and had no other means of support, having devoted her married life to keeping the home and looking after the children. In such cases, it is easy to see why the courts have made family provision awards designed to secure the widow’s continued residence in the former matrimonial home.

93. Social conditions have changed, and it may be that, increasingly, cases of this type will involve a stay-at-home husband applying for provision out of the estate of his working wife. In such cases, I do not doubt that the Court would take the same attitude towards an application by a widower as it would to an application by a widow in a similar situation. But it is I think clear that the Court must base its decision on the circumstances of the case rather than on preconceived rules or assumptions. That is the thrust of what Hodgson JA said in Marshall v Carruthers, in the passage already quoted. Young CJ in Eq spoke to similar effect at [73]-[74]. In Bladwell v Davis, Bryson JA said that the adoption of some sort of general rule that “widow takes all” was contrary to the statutory obligation to consider all relevant circumstances: at [12], [18]-[19]; see also his Honour’s comments at [13]-[14] on the statement in Luciano v Rosenblum. Ipp JA in Bladwell v Davis agreed with Bryson JA before adding the comment in the passage already quoted. Hallen J in Jagoe v Maguire also commented that "general principles” should not be elevated into rules of law or usurp the Court’s duty to make a value judgment, and that the “statutory provisions must remain firmly in mind”: at [139].

94. In my opinion, there is no rule, general or otherwise, that following a long marriage the surviving spouse, by virtue of that status alone, will be entitled to provision out of the deceased spouse’s estate sufficient to keep him or her in the same lifestyle as he or she enjoyed during the marriage. An entitlement to provision of this type must always be justified by reference to the circumstances of the particular case.

95. I accept that, even with the proceeds of his half share of the Cronulla property, Manuel is not well off, and that his prospects of acquiring further assets to support his future lifestyle are minimal compared with the opportunities which Elena has. But, in my view, that is only the starting point of the analysis, not the end point. In a family provision application, much more is involved than a mere comparison of the “needs” of the claimant with the “needs” of the beneficiary. The question is whether the deceased may fairly be treated as subject to an obligation to satisfy the claimant’s “needs” when such an obligation would override the dispositions the deceased has actually made. The Court must consider the conduct of, and the relationships between, the relevant parties. What level of provision for the claimant is “proper” and what provision “ought to be made” for the claimant then depend upon value judgments.

96. It is well established that where the deceased’s testamentary arrangements are apparently based on considered and understandable judgments by the deceased and there has been no radical or unforeseeable change in circumstances, the Court will be reluctant to displace the dispositions made by the deceased, who may usually be assumed to have known far more about what really happened than the Court can hope to know: Slack v Rogan; Palffy v Rogan (2013) 85 NSWLR 253 at 284-285 [127]. That principle is of particular importance in the present case. The deceased’s decision not to make any further provision for Manuel apart from a six month right of residence was clearly a considered one, certainly going back as far as the 1999 will, and probably going back to the transfer of the Cronulla property into tenancy in common in 1979. To the extent that there is any doubt as to the nature of the relationship between the deceased and Manuel, the deceased was the one who knew the facts and her judgment is clear. There is nothing in the evidence to suggest that the deceased’s dispositions were based on any misconception about Manuel’s character or conduct. Nor are the relative financial positions of Manuel and Elena as they now stand unexpected or unforeseen. The circumstances as revealed by the evidence are not substantially different from what the deceased would have foreseen in 2014.

97. In my opinion, the deceased’s testamentary dispositions in favour of Elena and to the exclusion of Manuel are quite understandable in the circumstances. Three factors, in particular, stand out.

98. First, the evidence does not establish that a 50/50 division of the property is financially unfair to Manuel. It may even be favourable to him. The deceased’s ownership of the Erskineville property, which predated her relationship with Manuel, had presumably made a significant contribution to the parties’ joint equity when they purchased the Cronulla property. The balance of the purchase price for the Cronulla property was apparently paid off by 1988. Throughout the period from 1975 to 1988, the deceased was working as well as Manuel. There is no evidence to show that Manuel’s contribution over that period was greater than that of the deceased, let alone that it outweighed the deceased’s initial contribution. The repayment of the subsequent borrowings on the property is neutral as the borrowings appear to have been for Manuel’s personal benefit.

99. Although counsel for Manuel submitted that he had made a greater financial contribution to the household financially, I do not think this has been established. Certainly Manuel continued to work after the deceased retired in 1992. He was unemployed for a period of time after 1998 but it may be accepted that over the 23 year period from 1992 to his own retirement in 2015 his earnings would have been greater than that of the deceased. But it has not been established that the deceased received a disproportionate benefit from those additional earnings.

100. Secondly, Manuel consented to the conversion of the joint tenancy into a tenancy in common in 1979 and I am satisfied that he was aware of the deceased’s testamentary intentions over a long period of time. So far as appears, he never protested to the deceased about them. He consented to the severance of the joint tenancy into a tenancy in common. The deceased was well entitled to proceed on the basis that Manuel understood and accepted that if she predeceased him, her half share of the property would pass to her family, and to conduct herself accordingly.

101. Third, Manuel continued to work throughout virtually the whole of the marriage and only retired at the end of his working life. There were no children of the marriage and the evidence makes it clear that Manuel did not devote himself to the role of a homemaker. So far as appears, he did not pass up any employment opportunities on account of his marriage to the deceased.

102. It is true that the deceased continued to attend church and other events with Manuel. It might be said that she was happy to have Manuel in her life for the purpose of displaying him to the world as her husband. But if that involved hypocrisy, hypocrisy is irrelevant for present purposes. Equally, Manuel can have been under no illusions as to the true nature of their relationship and it apparently also suited him for the marriage to continue.

103. Whether the deceased made “proper” provision for Manuel is a matter of applying “community standards”. In my opinion, there is no single “community standard” which defines in each factual situation what level of provision is “proper”. I think that “community standards” encompass a range of views. Some people in the community may believe that the marriage tie is so important that it confers an obligation, even in a dysfunctional marriage such as this one, for the spouses to provide for each other by will. But others may believe that it does not require full sharing of all the parties’ assets and that if the parties choose to draw a dividing line between their assets and deal with them separately that is perfectly fair and reasonable. I do not think the Court’s role is to try to decide which view is “better”, if that were possible.

104. In my opinion, having regard in particular to the three factors I have identified, the deceased’s testamentary dispositions cannot be said to be outside the reasonable range of community expectations, and, accordingly, I am not satisfied that the deceased failed to make a “proper” level of provision for Manuel.

105. If I am wrong in thinking that these factors can be taken into account at this stage of asking whether the level of provision was “proper”, then I would nevertheless take them into account in considering what specific provision “ought to be made”.

106. For this purpose, I think it would also be relevant to take into account that the Cronulla property must be sold in any event, and that means that Manuel will have to move. Manuel’s evidence concerning his searches for property was hardly comprehensive. Evidence from Nancy established that a one bedroom unit in the Cronulla area could be obtained for $600,000, which would leave Manuel with approximately $200,000 from his share of the Cronulla property to support himself into the future. Counsel for Manuel’s riposte was that a one bedroom unit was quite inappropriate to his circumstances, but I do not see why; and furthermore, I do not see why Manuel should expect, as a matter of entitlement, to continue to live in Cronulla. He said that he wished to do so as he regularly visited the deceased’s grave, but, even if this is correct, I think that continuing to live in a particular suburb of Sydney cannot be regarded as a “need” in any relevant sense.

107. If I had found it necessary to consider what provision “ought to be made” for Manuel, I would have made no further provision for him.

Conclusion and orders

108. For these reasons, I conclude that the application for family provision fails and should be dismissed.

109. I will hear the parties on costs, should they not be able to agree.

110. The orders of the Court are:

1.   Order that the proceedings be dismissed.

2.   Grant liberty to the parties to apply with respect to costs, such application to be made within 14 days of the commencement of the 2018 Law Term.

**********

Decision last updated: 17 April 2018