In the Estate of LEITCH (DECEASED) - [2017] SASC 14

SUPREME COURT OF SOUTH AUSTRALIA
(Testamentary Causes Jurisdiction: Application)
In the Estate of LEITCH (DECEASED)
[2017] SASC 14
Judgment of The Honourable Justice Bampton
14 February 2017
SUCCESSION - PROBATE AND LETTERS OF ADMINISTRATION - PROCEDURE - SOUTH AUSTRALIA - OTHER MATTERS
SUCCESSION - PROBATE AND LETTERS OF ADMINISTRATION - GRANTS OF PROBATE AND LETTERS OF ADMINISTRATION - GRANTS OF ADMINISTRATION GENERALLY - TRUSTEE COMPANIES
Application for approval by Australian Executor Trustees Ltd, a trustee company, to apply for and obtain letters of administration of the estate of Simon William Westwood Leitch (deceased) pursuant to s 4(3)(b) of the Trustee Companies Act 1988 (SA) – the Registrar of Probates issued a requisition – Australian Executor Trustees Ltd made further application seeking an order appointing it administrator of the intestate estate and seeking a declaration that the matters raised in the Registrar’s requisition were irrelevant to the question of its appointment – discussion of Registrar’s powers.
HELD:
1. Approval to Australian Executor Trustees Ltd to apply for and obtain letters of administration in the estate of Simon William Westwood Leitch.
2. Upon the filing of an administrator’s oath and affidavit of assets and liabilities, an order will be made appointing Australian Executor Trustees Ltd an administrator.
3. Application for declaratory relief refused.
Corporations Act 2001 (Cth) s 601TBA; Administration and Probate Act 1919 (SA) s 7A, s 8, s 45; Trustee Companies Act 1988 (SA) s 4; Public Trustee Act 1995 (SA) s 9; Probate Rules 2015 (SA) r 10, r 83, referred to.
In Re The Judiciary Act 1903-1920; In Re The Navigation Act 1912-1920 (1921) 29 CLR 257, applied.

In the Estate of LEITCH (DECEASED)
[2017] SASC 14
Testamentary Causes Jurisdiction

BAMPTON J: By summons issued on 28 June 2016, Australian Executor Trustees Ltd (“AET”) seeks an order pursuant to s 4(3)(b) of the Trustee Companies Act 1988 (SA) (“the Act”) granting approval to apply for and obtain letters of administration in the estate of the late Simon William Westwood Leitch (“the deceased”).
An affidavit of Peter Don Steggall, an AET Senior Estates and Trusts Specialist, sworn on 20 June 2016 is filed in support of the order sought.
Background
The deceased, who died on 17 October 1996 without leaving a will, is survived by his widow, Vanessa Scrimshaw, and two adult children from his first marriage, Roun Artman Iyer and Emily Iyer (“the children”).
In his affidavit Mr Steggall deposes that the sole asset of the deceased’s estate comprises an interest in the estate of the late Maxwell Eustice Lawton (“the Lawton estate”). Under the heading “Personal Estate” in his affidavit, Mr Steggall refers to AET being the trustee of the Lawton estate.
Letters of administration must be granted in the deceased’s estate in order for the Lawton estate interest to be paid to it.
Section 4 of the Act provides that a trustee company may act as an executor or an administrator of a deceased estate. Subsection (3) provides:
(3)A trustee company may, with the approval of the Court or the Registrar and the consent of the person entitled to probate of the will or a grant of administration of the estate of a deceased person, apply for and obtain—
(a) probate of the will of the deceased person; or
(b) letters of administration of the estate of the deceased person,
(as the case requires).
Annexed to Mr Steggall’s affidavit are the signed written consents of Ms Scrimshaw and the children as required by s 4(3) of the Act. Mr Steggall also deposes to the estimated legal costs of AET seeking approval and that AET “will charge for its services an agreed fee of $11,482.11 plus GST representing a commission on the gross value of the estate calculated at a rate of $4.00 for every $100.00 of the capital value of the estate based on the estimated gross value of the estate of $287,052.69”. Ms Scrimshaw and the children each acknowledge in their written consents that they are aware of the estimated solicitors’ fees and the amount of AET’s commission.
Following the issuing of the 28 June 2016 summons, the Registrar of Probates (“the Registrar”) issued a requisition on 28 July 2016 enquiring as to whether Ms Scrimshaw and the children had been advised of the extent of the work likely to be necessary to administer the estate, that AET’s proposed fee is higher than the Public Trustee’s maximum fee for an estate of the same size, and of the likely charges by a solicitor for administering the estate (“the requisition”).
By letter dated 25 August 2016, AET’s solicitors responded to the requisition objecting to providing the information sought arguing that it was irrelevant to the question of whether letters of administration ought to be granted.
Upon referral of the matter to me by the Registrar pursuant to s 8 of the Administration and Probate Act 1919 (SA) (“the Administration and Probate Act”) and r 83 of the Probate Rules 2015 (SA) (“the Probate Rules”), counsel for AET intimated AET would issue a summons seeking a grant of letters of administration and a declaration regarding the relevance of the information sought in the requisition.
Accordingly, by summons issued on 16 November 2016, AET seeks:
1.A declaration that whether the plaintiff has provided advice to the beneficiaries of the Estate of the Late Simon William Westwood Leitch:
a.     of the extent of the work likely to be necessary to administer this estate;
b.    that the proposed fee is higher than Public Trustee’s maximum fee for an estate of the same size;
c.     of the likely charges by a solicitor for administering this estate
are each singularly and collectively irrelevant considerations with respect to whether there be a grant of administration to the plaintiff within the meaning of the Administration and Probate Act 1919 (SA).
2.That the plaintiff be appointed as an administrator of the estate of the Late Simon William Westwood Leitch on the basis that there is no valid will left by the deceased and the beneficiaries of the estate have provided their consent to such an appointment and lodged such consent at the Probate Registry.
An affidavit of Elyse Amber Miller, an AET Senior Client Service Adviser sworn on 2 November 2016 and an affidavit of Neil Whitehall Page, a solicitor, sworn on 29 November 2016 are filed in support of the orders sought.
In her affidavit, Ms Miller expands upon the matters deposed to by Mr Steggall in his affidavit explaining that Ms Scrimshaw and the children wished to appoint an independent executor as there was a potential conflict between them. Ms Scrimshaw was the second wife of the deceased and the children are the children of the deceased’s first marriage.
Ms Miller explains in detail the matters discussed with Ms Scrimshaw and the children by AET. Annexed to Ms Miller’s affidavit are copies of letters dated 9 September 2014 addressed to Ms Scrimshaw and the children,[1] wherein AET informed them that AET is the trustee of the Lawton estate and that AET is holding assets which are to be paid to the deceased’s estate. Further, as the deceased had died intestate, AET informed Ms Scrimshaw and the children of its Administrator Assist Service.
[1] Exhibit "EM1" to the affidavit of Ms Miller.
AET offered that it could apply for letters of administration and advised that its commission for administering the estate was based at a rate of four per cent plus GST on the gross value of the deceased’s estate assets. AET advised the approximate cost to administer the estate would be $13,200 plus GST on an approximate gross value of $330,000.
Ms Miller refers to Ms Scrimshaw and the children providing their consent to AET making the application for letters of administration as deposed to in Mr Steggall’s affidavit.
Ms Miller also deposes that she instructed AET’s solicitors to respond to the requisition, stating that AET has not provided a comparison of fees as requested and, after discussing the matter with AET’s legal counsel, she did not believe there was any legal obligation to do so. Ms Miller further deposes that on 12 October 2016 correspondence was sent to Ms Scrimshaw and the children setting out, notwithstanding AET’s view there was no obligation to do so, a comparison of AET’s fees and the Public Trustee’s fees. Further, AET agreed to fix its fees in administering the estate to an amount of $11,492.11 plus GST and disbursements. Ms Miller states that, as a result of that correspondence, Ms Scrimshaw and the children each provided their further written consent stating that they have been provided with a copy of the requisition, a copy of the response provided by AET’s solicitors dated 25 August 2016, an email from AET setting out the issues overall and a comparison of fees between AET and the Public Trustee, a copy of the Public Trustee fee schedule, and a copy of Schedule 2 of the Supreme Court Scale of Costs. Ms Scrimshaw and the children state in their further consents that they are aware that there is a difference in fees between what the Public Trustee is entitled to charge under its fee schedule and what AET has indicated it will charge. Having regard to these matters, Ms Scrimshaw and the children state that they consent to AET applying and obtaining a grant of letters of administration in the deceased’s estate.[2]
[2] Copies of the consents are exhibited as “EM7” to Ms Miller’s affidavit.
Approval pursuant to s 4(3)(b) of the Act
Having regard to the matters deposed to in Ms Millers’ affidavit including the consents provided by Ms Scrimshaw and the children pursuant to s 4(3)(b) of the Act, I approve AET applying for and obtaining letters of administration in the deceased’s estate.
Accordingly, I make an order in terms of the order sought at paragraph 1 of the summons dated 28 June 2016.
Order to be made appointing AET administrator
Upon AET filing an administrator’s oath and an affidavit of assets and liabilities, an order in terms of paragraph 2 of the summons dated 16 November 2016 appointing AET an administrator of the estate of the late Simon William Westwood Leitch will be made.
The declarations sought
In paragraph 1 of the summons dated 16 November 2016, AET seeks a declaration that the matters raised by the requisition are irrelevant considerations to the exercise of an administrative power to grant letters of administration to it. AET says it is not clear why the requisition was sought, stating there was, and is, no evidence available to the Registrar that would suggest any failure by it to make disclosure to the beneficiaries as disclosed by law.
Further, AET argues that the requisition is a departure from the longstanding historical approach of the Probate Registry to applications of this kind, that applications in this form are commonplace for it (often in the context of estates which, like this one, are of modest means) and referral to a justice of the Court inevitably results in costs and delay. In the circumstances, AET seeks the declaration, it says, in order to avoid any repeat of this issue in like applications.
AET submits that the Act:
·contains no prescription with respect to fees or other financial information that must be disclosed to the “person entitled to probate”;
·does not privilege the Public Trustee as a party who must be alternatively considered for a grant of letters of administration or as a point of comparison with a trustee company; and
·does not mandate any considerations beyond the consent of the person entitled to probate about which the Court or the Registrar must first be satisfied before providing approval.
AET argues that, historically, where an application for letters of administration has been lodged by it and those parties entitled to apply in priority provide their consent, an order has been made by the Registrar without further enquiry.
Further, it says that the Public Trustee’s standing to apply for an administration order in similar circumstances is contained in s 9 of the Public Trustee Act 1995 (SA), but there is nothing in that legislation that expresses the Public Trustee to be a preferable administrator or which requires for any particular fee comparison. The AET submits that the disclosure obligations imposed on private trustee companies is prescribed exhaustively by Commonwealth law and there is nothing in the Corporations Act 2001 (Cth) (“the Corporations Act”) that requires a trustee company to make a comparative disclosure of its fees against comparable fees charged by the Public Trustee or any other person.
AET argues that as part of the information and consent process provided to Ms Scrimshaw and the children, its fees have been disclosed clearly and that they satisfied any requirements under the Corporations Act. It argues that the fee disclosed is in accordance with its published fees as disclosed on its website and that that information is available to the Probate Registry. It says it is entitled to charge a fee for acting as administrator in accordance with s 601TBA of the Corporations Act. AET argues that as an administrative decision maker it is not for the Registrar to legislate additional obligations which are specific to private trustee companies and, particularly, not to impose additional obligations that are specific to it alone.
AET contends that declaratory relief is appropriate in this matter, submitting that there is a real question involved such that the declaration is directed to the determination of a legal controversy, that they have a real interest affected by the question raised, and that the declaration concerns real and not merely hypothetical events.
As I have made an order granting letters of administration to AET there is strictly speaking no need to consider AET’s claim for declaratory relief. Be that as it may, I make the following comments.
Pursuant to s 45 of the Administration and Probate Act, the estate of a person who dies intestate vests in the Public Trustee until an order has been obtained to administer the estate.
In seeking the declaration AET is seeking, in effect, an opinion of the Court “in order to avoid any repeat of this issue in like applications”. Such an opinion cannot be given by the Court as the declaration sought does not resolve any matter or controversy in issue in this matter.[3]
[3] In Re The Judiciary Act 1903-1920; In Re The Navigation Act 1912-1920 (1921) 29 CLR 257 at 265.
For the Court to make a declaratory order there must be a real question involved and the declaratory relief must be directed to the determination of a legal controversy. There is no basis to make the declaration sought as there has not been any justiciable controversy in this matter.
The Registrar exercises the jurisdiction of the Court in matters in the Testamentary Causes Jurisdiction to the extent that the Probate Rules provide.[4] Other legislation, such as s 4 of the Act, confers additional jurisdiction on the Registrar. This jurisdiction is not administrative. In these respects the Registrar exercises judicial power.
[4] Administration and Probate Act 1919 (SA) s 7A.
The declarations sought would involve a fetter on a discretion; the decision to approve or not. That is clearly impermissible.
Rule 10(6) of the Probate Rules provides:
(6) A grant is not to issue until all the inquiries which the Registrar sees fit to institute have been answered to the Registrar’s satisfaction.
The Registrar is entitled if not satisfied with the answers he receives, to refuse to give approval. In this case he chose not to do so, but instead referred the summons to a judge for consideration pursuant to s 8 of the Administration and Probate Act and r 83 of the Probate Rules.
My enquiries have revealed that applications by trustee companies seeking approval pursuant to s 4 (3)(b) of the Act are not common. The words “…with the approval of the Court or the Registrar…” in s 4(3) of the Act require the Court or the Registrar to consider whether or not a trustee company may apply for and obtain probate or letters of administration. Section 4(3) requires more of the Court or the Registrar than “rubber stamping” an application.
In granting approval pursuant to s 4(3)(b) of the Act the Court or Registrar “pronounces, considers good, speaks favourably of, confirms, sanctions officially, or ratifies”[5] the trustee company applying for and being granted letters of administration. It necessarily follows that the Court or Registrar must make such enquires as each considers fit in order to justly and properly exercise the power to approve the appointment of a trustee company as an administrator of an intestate estate.
[5] Macquarie Dictionary Online, 2016, Macquarie Dictionary Publishers.
As the estate of a person who dies intestate vests in the Public Trustee until an order has been obtained to administer the estate the Court or the Registrar is entitled to ask questions relevant to the exercise of the power to grant approval.
As the annexures to Mr Page’s affidavit demonstrate, the Public Trustee’s commission rate is calculated differently to AET’s. Ms Scrimshaw and the children upon being made aware of this gave their consent to AET making the application for approval to act as administrator.
The difficulty facing the Registrar upon the issuing of the 28 June 2016 summons was that very little information was provided in support of the order sought. Mr Steggall’s affidavit did not provide sufficient information enabling the Registrar or the Court to approve AET applying for and obtaining letters of administration.
Mr Steggall’s affidavit is scant in its detail when compared to the detail deposed to in Ms Millers’ affidavit. Mr Steggall does not explain that Ms Scrimshaw and the children wished to have an independent administrator appointed, that the relationship between Ms Scrimshaw and the children was acrimonious, or that AET had provided detailed advice regarding its fees/commission as set out in the letters dated 9 September 2014.
Indeed, had Ms Miller’s affidavit been filed in response to the Registrar’s requisition, the 16 November 2016 summons and the proceedings before me would have been unnecessary.
Finally, noting that Ms Miller deposes in her affidavit that AET “will cover Counsel fees in obtaining advice and attendance in relation to court hearings”, I do not need to make any order regarding costs.