In the Estate of BRIAN ATTIWILL MAGAREY (DECEASED) - [2009] SASC 279

SUPREME COURT OF SOUTH AUSTRALIA
(Testamentary Causes Jurisdiction)
In the Estate of BRIAN ATTIWILL MAGAREY (DECEASED)
[2009] SASC 279
Judgment of The Honourable Justice Gray
4 September 2009
SUCCESSION - EXECUTORS AND ADMINISTRATORS - RIGHTS, POWERS AND DUTIES - OTHER CASES
EQUITY - TRUSTS AND TRUSTEES - POWERS, DUTIES, RIGHTS AND LIABILITIES OF TRUSTEES - MISCELLANEOUS OTHER POWERS, DUTIES AND LIABILITIES
Application for a grant of probate - further executor and trustee nominated by codicil to will - nomination qualified, limiting executor and trustee's powers in respect of certain companies "unless requested so to do in writing by any other person who shall be a trustee hereof and in the event that there be no other person who is a trustee hereof … by a person or persons nominated by the President for the time being of the Law Society of South Australia" - whether delegation by deceased of right to remove limitation imposed by the deceased valid - whether, in the absence of another surviving executor taking a grant of probate, any person properly constituted a "trustee" for the purpose of making a request in accordance with terms of codicil.
Held: application granted - executor and trustee nominated by codicil entitled to grant of probate in respect of will and codicil of deceased - delegation by deceased of right to remove limitation valid - trustees appointed by terms of will constituted as trustees for purpose of making a request in accordance with terms of codicil - request made by trustees accordingly removed limitation on executor and trustee named in codicil.
The Probate Rules 2004 (SA) Rule 77, referred to.
Re Deichman (1842) 163 ER 676; In the Goods of Cringan (1828) 162 ER 673; In the Goods of Ryder (1861) 164 ER 941; Re Mercer [1964] QWN 26; In the Will of MacGregor (1901) SR (NSW) (B & P) 50; Jackson & Gill v Paulet (1851) 163 ER 1340, considered.

In the Estate of BRIAN ATTIWILL MAGAREY (DECEASED)
[2009] SASC 279
Testamentary Causes Jurisdiction
GRAY J.

This is a referral of an application for a grant of probate in respect of the will and codicil of the late Brian Attiwill Magarey, pursuant to Rule 77 of The Probate Rules 2004 (SA).
Introduction
Mr Magarey died at Leabrook in South Australia on 16 January 2008 aged 89 years leaving a will dated 2 June 2005 and a codicil to that will dated 20 December 2007.
By clause 2 of the will the deceased appointed his wife Betty Ailsa Magarey, his son Michael Roy Magarey and his daughters Josephine Margaret Mules and Robyn Elizabeth Magarey, as his executors and trustees. Betty Magarey survived the deceased, but died on 6 August 2008.
The codicil amended the appointment designated by clause 2 of the will and added Philip Leslie Farlam as an additional executor and trustee subject to certain restrictions. The nomination of Mr Farlam as an additional executor was qualified in the following way:
I APPOINT PHILIP LESLIE FARLAM of 66 Wright Street Adelaide in the State of South Australia Solicitor as an executor and trustee in addition to my wife, my son and my daughters, PROVIDED THAT notwithstanding anything herein or in my Will contained, the said Philip Leslie Farlam shall not be entitled to and shall not exercise or take part in the exercise of any power or discretion in relation to any act or matter relating to the following firms or company, namely:
(a)the firm of barristers and solicitors known as “Magarey Farlam Lawyers” or “Magarey and Magarey”;
(b)the firm of accountants known as “Magarey Farlam Accounting and Business Services”; or
(c)the firm known as “Magarey Farlam Financial Services”; or
(d)the company “Gimalo Administrators Pty (ACN 007 738 329)”
or in connection with the trust accounts of Magarey Farlam Lawyers or Magarey and Magarey or property or cash held by any of the said firms or company or the former partners or proprietors thereof upon trust for
(e)me; or
(f)any trust, estate or entity associated with me or in which I have an interest; or
(g) any other former client
unless requested so to do in writing by any other person who shall be a trustee hereof and in the event that there be no other person who is a trustee hereof then the powers and discretions that my trustees may be called upon to exercise in relation to such matters (including the power to request the said Philip Leslie Farlam to do anything) shall be exercised by a person or persons nominated by the President for the time being of the Law Society of South Australia.
In all other respects the codicil confirmed the will.
In accordance with his nomination as executor, Mr Farlam lodged an application for a grant of probate of the will and codicil, with leave reserved for the other named surviving executors, the three children of the deceased. His application was accompanied by the written consent of the three children, for him to act as executor.
The appointment of Mr Farlam as an executor under the codicil was neither opposed nor in issue. This appointment would entitle him to claim a limited grant as specified in the codicil. The issue arising for the determination of this Court is whether the deceased could delegate to others a right to remove a limitation imposed by the deceased on the appointment of Mr Farlam. A further issue for determination is if such delegation is permitted, in the absence of another surviving executor taking a grant of probate, is any person properly constituted a “trustee” for the purpose of making a request of Mr Farlam pursuant to the directive in the codicil.
It is accepted that there is no order of any Court bearing on or limiting Mr Farlam’s involvement in any capacity in relation to the matters referred to in the codicil. The President of the Law Society has not nominated any person, nor has the President been requested to nominate any person pursuant to clause 1 of the codicil.
Mr Farlam submitted that the terms of the codicil provide him with an entitlement to apply for a grant of probate of the estate save and except with respect to the firms, company and accounts listed in the codicil. It was said that this form of grant would be appropriate in the absence of any application for a grant by the three children of the deceased or any request by them pursuant to the codicil.
Mr Farlam submitted that the deceased could delegate to others the right to remove the limitation imposed by the deceased on the appointment of Mr Farlam. He contended further that the three children named as executors and trustees were capable, through a request in writing, of removing that limitation. It was said that the children of the deceased were appointed by the will to be trustees of the estate, whether or not they take a grant of probate of the will and codicil and consequently are the persons entitled to make a request in writing of Mr Farlam.
According to Mr Farlam, the default provision in the codicil with respect to the nominee of the Law Society, suggests that the power to authorise Mr Farlam to act is not intended to be exercised by anyone in the capacity of executor of the will. It was said that such a nominee would not be entitled or expected to take a grant of probate before making the request, and the same situation should apply to the child or children of the deceased in relation to their capacity to make the request. As such, Mr Farlam contended that this power is to be exercised persona designate by one of the members of the immediate family of the deceased.
Mr Farlam drew attention to the terms of the codicil. He observed that by the codicil, he is appointed “as an executor and trustee in addition to my wife my son and my daughters”. According to Mr Farlam there is a distinction between the obligations of an executor and those of a trustee. Having regard to this distinction, it was Mr Farlam’s contention that the children of the deceased are entitled to stand by until he has completed his duties as executor, and then join him as trustees of the estate in any further administration. Mr Farlam suggested that the reference in the codicil to “any other person who shall be a trustee hereof” in that context is a reference to the wife and children of the deceased. It is unlikely that this reference was intended to refer to some other person who had been substituted as a trustee. It was said that this construction of the codicil is confirmed by the “default clause” whereby a Law Society nominee is empowered to make a request to Mr Farlam “in the event that there be no other person who is a trustee hereof.”
Mr Farlam did not contend that the present situation is one to which the default provision currently applies. It is clear from correspondence on the file that Mr Farlam considers the default clause to only have application in the event that there are no other persons who may be regarded as a trustee of the will.
Mr Farlam confirmed that he intended to obtain the authority of all surviving children for him to obtain a general grant of probate, with leave reserved for them to apply. As earlier observed, these requests and consents were obtained and accompanied the application for a grant of probate.
Consideration of the matter
There is authority to suggest that a testator may authorise another to nominate an executor of his will or an executor and trustee, and effect will be given to such nomination.
In Re Deichman,[1] two persons were appointed as executors. The appointment contained the directive that should one executor die, the survivor was empowered to appoint another, so that there should continue to be two executors. Upon the death of the first executor, the second appointed John George Puckett to act with him. Mr Puckett did not apply for probate during the lifetime of the surviving executor. The Court held that probate could pass to Mr Puckett and he was entitled to appoint another executor to act with him:
…there appears to me in principle to be no difference between this appointment and that of two executors by a testator, and where one does not prove in the lifetime of the other. … I think that Mr. Puckett may take probate and appoint another to act with him.
[1] Re Deichman (1842) 163 ER 676 at 676-677.
Another authority illustrative of the legitimacy of a delegation to appoint an executor is In the Goods of Cringan.[2] In that case, the deceased appointed no executor but directed as follows:
It is left to the Legatees mutually to appoint two intelligent and trust worthy persons to execute this deed…
Probate was granted to the nominees appointed by the legatees, as executors:
…understanding from the deputy-registrar that instances have frequently occurred of granting probate to persons nominated by those authorized by the testator so to nominate, I shall allow this decree to pass as prayed.
[2] In the Goods of Cringan (1828) 162 ER 673 at 673-674.
The Court in In the Goods of Ryder[3] considered that the power to appoint as executor such person or persons as the appointer may think fit, included the appointer himself. The Court considered that by the use of the words, “I must beg Mr. S. P. Calvert to appoint some one…to see this my will executed”, Mr Calvert was within the words employed, and could nominate himself, unless there were some legal restraint or impediment arising out of the office to which the appointment related.
[3] In the Goods of Ryder (1861) 164 ER 941 at 942.
In the Queensland case of Re Mercer[4] the testator by his will appointed as executors and trustees “such two of the directors of …‘the company’… as may be nominated by resolution of the Board of Directors of the company together with my wife Gertrude May Mercer”. Two persons were nominated by resolution of the Board of Directors. In support of the request for a grant of probate to the nominated persons, the minutes of the meeting of the Board of Directors were annexed to an affidavit. The relevant part of the annexure was as follows:
“…Richard Gascon Bird and Frank Ernest Foulis being directors of the company be and they are hereby nominated as such executors such nomination to be for the use and benefit of the company”.
It is instructive to note that the reason for the referral of the matter to the Court was not as a result of a challenge to the entitlement of the testator to delegate the power to nominate an executor, but because one of the nominees was resident out of the jurisdiction. Probate was granted as requested, subject to the formal requirements of the Registrar.
[4] Re Mercer [1964] QWN 26.
In the case of In the Will of MacGregor[5] the testator by his will appointed certain persons as trustees and executors of his will. By codicil, the appointment of executors was revoked and the testator appointed a Victorian trustee company as trustee and executor of his will for all his estate in Victoria, and appointed as trustees and executors of his will in relation to his estate other than in Victoria, such persons as the company might nominate for that purpose. By a later codicil, the testator revoked the appointment of the company as executor and trustee, and appointed an alternative Victorian trustee company and two individuals as trustees and executors of his will, and directed that his will should be read and construed as if the name of the second company and of those individuals had appeared in place of the first company. That codicil relevantly provided:[6]
I revoke the appointment in my said will contained of the Union Trustee Company of Australia Limited as trustee and executor thereof and I hereby appoint in the place and stead of the said Union Trustee Company of Australia Limited The Trustees Executors and Agency Company of Australia Limited of Melbourne William Riggall of Melbourne solicitor and John Archibald Campbell of Dungalere Station in the colony of New South Wales grazier to be trustees and executors of my said will and I direct that my said will shall be read and construed throughout as if the name of the said The Trustees Executors and Agency Company Limited and the names of the said William Riggall and John Archibald Campbell had appeared therein in place of the name of the said The Union Trustee Company of Australia Limited.
[5] In the Will of MacGregor (1901) SR (NSW) (B & P) 50.
[6] In the Will of MacGregor (1901) SR (NSW) (B & P) 50 at 51.
Probate of the will and codicils was granted in Victoria to the second company and Mr Riggall, with leave being reserved to Mr Campbell to come in and prove. Mr Campbell subsequently renounced probate and the trusts of the will. The second company and Mr Riggall nominated an alternative trustee and executor of the will for the estate of the testator outside of Victoria.
Probate was granted to the nominated executor. Walker J held that the power to nominate an executor for the estate in New South Wales was properly exercised by the two executors to whom probate had been granted in Victoria.
In Jackson v Paulet[7] two persons were named in the will as executors, together with a third person to be nominated by the named executors and the widow of the deceased. Probate was granted to the named executors with leave reserved for a third person to apply when nominated. Although there was no probability of agreement between the named executors and the widow of the deceased in the choice of such third person, the court held that the form of the appointment did not offend the requirements of the Wills Act and was not void.   Sir Herbert Jenner Fust observed: [8]
[7]    Jackson & Gill v Paulet (1851) 163 ER 1340.
[8]    Jackson & Gill v Paulet (1851) 163 ER 1340 at 1341.
It was argued that, inasmuch as the parties in the suit cannot agree, and are not likely to agree, in nominating a third person as an executor, according to the directions of the testator, the appointment of Jackson and Gill to that office must be held void. With that view I cannot coincide, for it would utterly defeat the testator’s intention.
The above extract demonstrates that the delegation of a power to nominate an executor is permitted. However Sir Herbert Fust continued to observe that in the circumstances of this case, such power was only to be exercised once the named executors obtained a grant of probate:
According to the construction I put on the recited words of the will, Jackson and Gill are not as individuals to nominate a third person for an executor, but they are so to do as executors, jointly with the widow - the third person is to be “conjoined” with them, being executors. They cannot then, on my view, proceed to nominate that person, until they have themselves obtained probate and clothed themselves with the character of executors.
This outcome was based significantly on the construction of the following words in the will: [9]
…and I hereby nominate, constitute, and appoint the said Peter Jackson, Robert Gill, and such third person as shall be nominated and conjoined as aforesaid to be executors of this my last will and testament.
(emphasis added)
As Sir Herbert Fust observed, the third person was to be conjoined with the two other executors, and as a consequence, the nomination of a third person could only be effected after they themselves obtained probate and became executors.
[9]    Jackson & Gill v Paulet (1851) 163 ER 1340 at 1340.
In the circumstances of the present case, the construction of the codicil lends itself to a different conclusion. The delegation of the power to remove the limitation on his appointment was to any person who “shall be a trustee hereof”.
The authorities clearly demonstrate that the deceased was entitled to delegate the power to nominate an executor or an executor and trustee. The question that arises for consideration is whether the children of the deceased, in the absence of taking a grant of probate, can be properly constituted as a “trustee” for the purpose of exercising that power.
The children of the deceased by the terms of his will were appointed as the deceased’s trustees. The appointment was valid and effective and on his death, his children became trustees. Pursuant to the terms of the will, their powers as trustees included the power to nominate Mr Farlam to act without limitation as a trustee and executor of the deceased and to make application for a grant of probate. This power was exercised by a formal request in writing, dated 6 April 2009 and signed by the children of the deceased in the following terms:
WHEREAS Brian Attiwill Magarey late of 1C Rochester Street Leabrook in the State of South Australia Retired Solicitor (“the deceased”) died on the 16^th day of January 2008 having made and duly executed his last will dated the 2^nd day of June 2005 and a codicil thereto dated the 20^th day of December 2007
AND WHEREAS by his said will the deceased did appoint his wife Betty Ailsa Magarey his son Michael Roy Magarey and his daughters Josephine Margaret Mules (also known as Josephine Margaret Magarey) and Robyn Elizabeth Magarey to be executors and trustees thereof
AND WHEREAS by the said codicil the deceased did appoint Philip Leslie Farlam formerly of 66 Wright Street Adelaide in the said State but now of 33 Pirie Street Adelaide aforesaid Solicitor as an executor and trustee in addition to his wife son and daughters as aforesaid provided that the said Philip Leslie Farlam shall not be entitled to and shall not exercise or take part in the exercise of certain powers and discretions unless he be requested in writing to exercise the same by any of them the said Betty Ailsa Magarey Michael Roy Magarey Josephine Margaret Mules and Robyn Elizabeth Magarey
AND WHEREAS the said Betty Ailsa Magarey died on the 6^th day of August 2008
NOW we the said Michael Roy Magarey of 35 Halsbury Avenue Kingswood in the said state Barrister, Josephine Margaret Mules (also known as Josephine Margaret Magarey) of 48 Queen Street Glenunga in the said state Social Worker and Robyn Elizabeth Magarey of 1C Rochester Street Leabrook aforesaid Retired Physiotherapist do hereby declare that we have not intermeddled in the estate of the deceased and will not hereafter intermeddle in the estate with intent to defraud creditors and we do and each of us does request the said Philip Leslie Farlam to exercise all powers and discretions referred to in the codicil in relation to all and any acts or matters relating to the following firms or company namely:
(a)the firm of barristers and solicitors known as “Magarey Farlam Lawyers” or “Magarey and Magarey”;
(b)the firm of accountants known as “Magarey Farlam Accounting and Business Services”; or
(c)the firm known as “Magarey Farlam Financial Services”; or
(d)the company “Gimalo Administrators Pty (ACN 007 738 329)”
or in connection with the trust accounts of Magarey Farlam Lawyers or Magarey and Magarey or property or cash held by any of the said firms or company or the former partners or proprietors thereof upon trust for
(e)the deceased; or
(f)any trust, estate or entity associated with the deceased or in which the deceased has an interest; or
(g)any other former client
to the intent that the said Philip Leslie Farlam shall be entitled to apply for and obtain a grant of probate of the said will and codicil without any limitation upon such grant and have power to exercise all of the powers, functions and discretions of an executor or a trustee in relation to the estate of the deceased and in particular (and without limiting the generality of the foregoing) the power to compromise or otherwise settle any debt, account or claim relating to the estate of the deceased.

It is to be observed that the carefully drawn request meets the expressed terms of the request referred to in the will of the deceased and accordingly, is a valid request.
Conclusion
For these reasons Philip Leslie Farlam is entitled to a grant of probate in respect to the will and codicil of the late Brian Attiwill Magarey, with leave reserved to the other named, surviving executors, the three children of the deceased. Mr Farlam is entitled to seek a grant of probate without limitation.