In the Estate of PETER MCBRIDE (DECEASED) - [2019] SASC 204

SUPREME COURT OF SOUTH AUSTRALIA
(Testamentary Causes Jurisdiction: Application)
In the Estate of PETER MCBRIDE (DECEASED)
[2019] SASC 204
Judgment of The Honourable Justice Stanley
22 November 2019
SUCCESSION - ADMINISTRATION OF ESTATE
This is an application for judicial advice or direction pursuant to s 69 of the Administration and Probate Act 1919 (SA) (the Act).
The deceased died on 24 July 2018. The gross value of his estate is $28,274,390.11. The net value of his estate is $28,165,508.90. The deceased executed his last will (the Will) on 27 September 2016. The applicant, Franco Camatta, is the executor of the deceased’s estate pursuant to a grant of probate made on 15 March 2019. Clause 15 of the Will states:
"I DIRECT my Trustee shall be entitled to a once only initial commission equal to one percent (1%) of the gross value of my assets as disclosed in the list of assets to be filed with the application for a grant of Probate in my estate plus any Goods and Services Tax applicable thereupon out of which monies my Trustee shall bear the cost of insuring himself against all risks to him or carrying out the administration of my estate and in addition thereto my estate shall bear all costs and disbursements arising out of the proper administration of my estate in respect of which my Trustee shall be entitled to engage such legal accounting or other professional services as he shall in his absolute discretion deem necessary and my Trustee shall not be entitled to charge or be paid any other fees for his or her services in connection with this my Will or the trust."
The applicant is a solicitor and a director of the firm Camatta Lempens Pty Ltd (the law firm).
On or around 11 October 2018, the applicant retained the law firm to provide professional (legal) and other services to him in his capacity as executor of the estate of the deceased. The executor seeks advice or direction that, on the proper construction of clause 15 of the will, he would be justified in:
1. continuing to retain the law firm to perform work for and on behalf of the deceased’s estate on a fee for service basis, provided that the law firm does not charge for any work (whether legal or executorial) done by him;
2. having the estate pay the costs of executorial work performed by the law firm; and
3. claiming and receiving his executor’s commission, clause 15 of the Will, despite having retained the law firm in accordance with the above.
The applicant also seeks an order that the costs of the application be paid out of the deceased’s estate, such costs to be adjudicated on the footing of an indemnity.
Held, per Stanley J:
1. The applicant, in his capacity as executor of the estate of Peter McBride, is directed that he would be justified in retaining Camatta Lempens Pty Ltd to perform legal work for and on behalf of the deceased’s estate on a fee for service basis, provided that Camatta Lempens Pty Ltd does not charge the estate for any work (whether legal or executorial) done by him.
2. The applicant, in his capacity as the executor of the estate of Peter McBride, is directed that he would be justified in claiming and receiving his executor’s commission in clause 15 of the Will of the deceased, despite having retained Camatta Lempens Pty Ltd in accordance with paragraph 1 above.
3. The applicant, in his capacity as the executor of the estate of Peter McBride, is directed that he would not be justified in charging the estate for the performance by his agents of any executorial work for and on behalf of the deceased’s estate. He is to reimburse the estate for the charges the estate has met for the performance by the law firm of the non-legal work.
4. The costs of the application be paid out of the deceased’s estate, such costs to be adjudicated on the footing of an indemnity.
Administration and Probate Act 1919 (SA) s 69, s 70; Trustee Act 1936 (SA) s 56; Trustee Act 1925 (NSW) s 63(2); Trustee Act 1962 (WA) s 53, referred to.
In the Will of Douglas (1951) 51 SR (NSW) 282; In the Estate of Instone (Unreported, Supreme Court of New South Wales, Powell J), applied.
In the Estate of Hunter [1957] SASR 194; In the Estate of Atkinson [1971] VR 612; GB Nathan & Co Pty Ltd (In Liq) (1981) 24 NSWLR 674; Re Jackson [1944] SASR 82; Chick v Grosfeld (No 3) [2012] NSWSC 1536; In the Will of Sheppard [1972] 2 NSWLR 714; Starke v James [2009] SASC 40; Starke v James (No 2) [2009] SASC 221; In the Will of Shannon [1977] 1 NSWLR 210; Fielder v Burgess [2014] SASC 98; Swanson v Emmerton [1909] VLR 387; Re Sleight (1883) 22 ChD 727, discussed.
IOOF Australia Trustees & The Trustee Act 1936 [1999] SASC 461; Magarey Farlam Lawyers Trust Accounts (No 2) (2006) 96 SASR 323; Public Trustee v O’Donnell (2008) 101 SASR 228; Martin v Hayward [1908] SALR 187; Robinson v Pett (1734) 24 ER 1049; In the Will of McClung [2006] VSC 209; Re Gambling [1966] SASR 134; Re Mclean (1911) 31 NZLR 139; Re Craig (1952) 52 SR (NSW) 265; In the Will of Kerrigan (1935) 35 SR (NSW) 242; Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280; Collector of Customs v Cliffs Robe River Iron Associates (1985) 7 FCR 271, considered.

In the Estate of PETER MCBRIDE (DECEASED)
[2019] SASC 204
Testamentary Causes Jurisdiction

STANLEY J: This is an application for judicial advice or direction pursuant to s 69 of the Administration and Probate Act 1919 (SA) (the Act).
The deceased died on 24 July 2018. The gross value of his estate is $28,274,390.11.[1] The net value of his estate is $28,165,508.89. The deceased executed his last will (the Will) on 27 September 2016. The applicant, Franco Camatta, is the executor of the deceased’s estate pursuant to a grant of probate made on 15 March 2019. Clause 15 of the Will states:
I DIRECT my Trustee shall be entitled to a once only initial commission equal to one percent (1%) of the gross value of my assets as disclosed in the list of assets to be filed with the application for a grant of Probate in my estate plus any Goods and Services Tax applicable thereupon out of which monies my Trustee shall bear the cost of insuring himself against all risks to him or carrying out the administration of my estate and in addition thereto my estate shall bear all costs and disbursements arising out of the proper administration of my estate in respect of which my Trustee shall be entitled to engage such legal accounting or other professional services as he shall in his absolute discretion deem necessary and my Trustee shall not be entitled to charge or be paid any other fees for his or her services in connection with this my Will or the trust.
[1] In his affidavit of 26 August 2019 the applicant deposes to the possibility that the value of the estate may need to be re-assessed upwards. The applicant is currently investigating this matter. If satisfied that the assets of the estate have increased in value, the applicant undertakes to file a further affidavit clarifying the position. Obviously, if the gross value of the estate increases, that will affect the extent of the commission to which the applicant is entitled pursuant to clause 15 of the will.
The applicant is a solicitor and a director of the firm Camatta Lempens Pty Ltd (the law firm).
On or around 11 October 2018, the applicant retained the law firm to provide professional (legal) and other services to him in his capacity as executor of the estate of the deceased. The executor seeks advice or direction that, on the proper construction of clause 15 of the will, he would be justified in:
1continuing to retain the law firm to perform work for and on behalf of the deceased’s estate on a fee for service basis, provided that the law firm does not charge for any work (whether legal or executorial) done by him;
2having the estate pay the costs of executorial work performed by the law firm; and
3claiming and receiving his executor’s commission, clause 15 of the Will, despite having retained the law firm in accordance with the above.
The application also seeks an order that the costs of the application be paid out of the deceased’s estate, such costs to be adjudicated on the footing of an indemnity.
The evidence
The applicant relies upon his affidavits filed 1 August 2019, 15 August 2019 and 26 August 2019. I am prepared to rely upon the statements of fact set out in those affidavits.
In or around December 2011, the deceased instructed Jamison & Associates of 31 Dequetteville Terrace, Kent Town in the State of South Australia to draft a will. That will was executed on 19 December 2011 (the prior will).
On 25 August 2016, the deceased instructed the applicant to draft the Will. The Will mirrors the prior will, save as to limited changes in the beneficiaries who were to receive gifts. The differences between the Will and the prior will are consistent with the handwritten notes of the deceased made on the face of the prior will.
The applicant drafted the Will in accordance with the deceased’s instructions.
To date four invoices have been raised by the law firm and three paid.
The applicant has not billed or charged fees, and does not propose to bill or charge fees, for any work in administering the estate (including professional, legal or other work), whether through the estate or otherwise. The applicant seeks a direction as to the continuing retainer of the law firm. If the Court declines to give that direction and it finds that the past conduct in retaining the law firm constitutes a breach of trust, the applicant undertakes to take immediate steps to remedy the breach including, but not limited to, an application under s 56 of the Trustee Act 1936 (SA) (the Trustee Act).
Section 69
Section 69 of the Act permits an executor, when in difficulty or doubt, to seek the advice or direction of the Court in matters connected with the administration of any estate, or the construction of any will, deed or document. Unlike analogous provisions in other jurisdictions[2] there is no express provision as to the effect of the advice or direction. In South Australia, it has been held that:
The direction given to [the trustee] protects and indemnifies the trustee against any claim for breach of trust, provided always that the facts have been fully and fairly disclosed, but leaves the question open as between beneficiaries who have not been cited to see the proceedings.[3]
[2] Cf Trustee Act 1925 (NSW) s 63(2).
[3] In Re Hunter [1957] SASR 194 at 196; Re IOOF Australia Trustees & The Trustee Act 1936 [1999] SASC 461 at [3]; Re Magarey Farlam Lawyers Trust Accounts (No 2) (2006) 96 SASR 323 at 330‑331; Public Trustee v O’Donnell [2008] SASC 181, (2008) 101 SASR 228 at [29].
In Re Atkinson,[4] the Court said:[5]
If the executor or the trustee then followed the direction of the court, it would be protected from any claim by a beneficiary or creditor arising from its action or inaction in accordance with the court’s direction.
[4] [1971] VR 612.
[5] [1971] VR 612 at 615.
To similar effect, in re GB Nathan & Co Pty Ltd (In Liq),[6] the Court said:[7]
These various statutory provisions for directions were a development from the practice of the Court of Chancery under the general law in giving directions to those entrusted with the administration of property under the control of the court. Two main classes of such persons were (1) trustees of trust property, or executors or administrators of a deceased estate, under administration by the court pursuant to a decree for general administration, and (2) receivers (and managers) appointed by the court in respect of property the subject of litigation. In such cases the exercise by those persons (to whom I will collectively refer as official administrators) of administrative or managerial functions were subject to close control by the court and in many instances they could safely exercise their powers only with the approval, and in accordance with the directions, of the court …
Generally speaking, if the court gave a direction to an official administrator who had made a full and fair disclosure to the court of the material facts, the official administrator might act in accordance with the direction without thereby incurring personal liability to any of the persons in whose interests the administration was being conducted, for example, creditors or beneficiaries of a deceased estate …
[6] (1981) 24 NSWLR 674.
[7] (1981) 24 NSWLR 674 at 677.
In this manner, a direction under s 69 effectively sanctions conduct that otherwise might be a breach of duty. However, it does not permit the applicant to seek orders departing from the terms of the Will.
The application may be brought without notice to any other party[8] and, any such order made in the absence of an interested party shall have the same effect, or be of the same force or validity, so far as regards protection of the executor as if the same had been a decree or order made in an action where all parties concerned were represented.[9] In In Re Jackson[10] Mayo J stated the effect of such an order being made ex parte in the following terms:[11]
If I were to make such an order as asked ex parte, and it were properly within my power so to do, it would be effectual as a defence for the executor in proceedings against him for breach of duty, but the absent parties may still have enforceable rights against persons other than the executor, and might even follow the property if entitled thereto, into the hands of others who had received it. …
[8] Section 69(2).
[9] Section 69(5).
[10] [1944] SASR 82.
[11] [1944] SASR 82 at 86.
Advice given under s 69 is prospective or executory only. It does not authorise or protect against action for any conduct already undertaken that may constitute a breach of trust.[12] This would be a matter for s 56 of the Trustee Act.
[12] Martin v Hayward [1908] SALR 187.
Executor’s remuneration
Subject to the terms of the will, an executor is not entitled to charge the estate for his or her work done in relation to the administration of the estate.[13]
[13] Robinson v Pett (1734) 24 ER 1049; In the Will of McClung [2006] VSC 209 at [28]; Chick v Grosfeld (No 3) [2012] NSWSC 1536 at [7].
An executor may retain and charge the estate for the services of a professional person, such as a solicitor, accountant or estate agent, to provide such professional services as may be required to assist in the administration of the estate.[14]
[14] Chick v Grosfeld (No 3) [2012] NSWSC 1536 at [8].
In this context, a distinction is drawn between professional work (that is to say, work of a legal or accounting nature) and non-professional work (the work otherwise undertaken by the executor).[15]
[15] In the Will of Sheppard [1972] 2 NSWLR 714 at 718.
In general, and subject to the terms of the will, an executor is not entitled to be indemnified out of the estate for the costs of retaining a solicitor to undertake executorial duties of a non-professional nature. In In the Will of Douglas[16] Roper J held that in general an executor will not be allowed out of the estate charges of his solicitor for doing things which he ought strictly to have done himself.[17]
[16] (1951) 51 SR (NSW) 282.
[17] (1951) 51 SR (NSW) 282 at 283.
Finally, unless the will otherwise expressly provides, an executor who is such a professional person is not entitled to charge for his or her professional services if he or she does that work.[18] In the absence of a relevant clause in the will, an executor is only able to be remunerated by way of an application for the payment of commission from the estate under either s 70 of the Act or the inherent jurisdiction of the Court.[19] Commission is awarded for “pains” and “trouble”. “Trouble” is used to assess the work which is actually attended to by the executor.[20] In the event that the executor is a professional person, but not otherwise permitted to charge professional fees, the Court may take any such work into account in determining the amount of commission.[21]
[18] Chick v Grosfeld (No 3) [2012] NSWSC 1536 at [8].
[19] ReGambling [1966] SASR 134 at 135-136; In the Will of Shannon [1977] 1 NSWLR 210 at 214-215.
[20] Re Mclean (1911) 31 NZLR 139 at 144.
[21] Re Craig (1952) 52 SR (NSW) 265 at 267-268.
In Starke v James[22] and Starke v James (No 2)[23] this Court has recently allowed a solicitor to be paid a commission by way of an assessment of the work done and charged on the Supreme Court scale. In Starke v James the will appointed a solicitor as executor but did not have a charging clause. The Court permitted him to claim commission under s 70 of the Act to be assessed as the costs payable for the work he had properly done under the relevant Supreme Court Costs Schedule. This included both professional (legal) work and non‑professional executorial work.[24]
[22] [2009] SASC 40.
[23] [2009] SASC 221.
[24] [2009] SASC 221 at [8].
The provisions of the will may provide that an executor may charge for the work that he or she renders the estate or that he or she be paid a fixed sum by way of commission. The extent of that right is a matter of construction, but such a clause may be permissive or restrictive;[25] be in addition to or in lieu of the right to apply to the Court;[26] apply only to professional work; or apply to all work undertaken by an executor.[27]
[25] In the Will of Kerrigan (1935) 35 SR (NSW) 242 at 245; Chick v Grosfeld (No 3) [2012] NSWSC 1536 at [9].
[26] In the Will of Shannon [1977] 1 NSWLR 210 at 216; In the Will of Sheppard [1972] 2 NSWLR 714 at 720; Chick v Grosfeld (No 3) [2012] NSWSC 536 at [21].
[27] In the Estate of Instone (Unreported, Supreme Court of New South Wales, Powell J) at 36-37; Chick v Grosfeld (No 3) [2012] NSWSC 1536 at [12].
Clause 15 of the will
The principles of construction of wills are well known.[28] As stated in Williams on Wills:
A will must be so construed that effect is given to every word. The court has no right to disregard a word provided some meaning can be given to it, and that meaning is not contrary to some intention plainly expressed in other parts of the will. The court does not as a rule import to the testator that he uses additional words without some additional purpose or without any purpose at all.[29]
[28] Fielder v Burgess [2014] SASC 98 at [40]-[43].
[29] Williams on Wills (9^th ed, 2008) para [50.16].
The Will does not authorise the applicant to charge for his professional or other services and, indeed, goes further and expressly prohibits him from doing so. He is also prohibited from applying to the Court for further commission. The prohibition on the applicant not being entitled to charge or be paid any other fees for his services in connection with the administration of the estate in addition to the commission uses the term “his or her services in connection with”. “In connection with” has been construed widely. The phrase is capable of describing a spectrum of relationships ranging from the direct and immediate to the tenuous and remote.[30] Such a phrase has been held to be both wide and imprecise.[31] A common meaning of the phrase is said to be the “relation between things one of which is bound up with, or involved, in another”.[32] However, the restriction is on “his … services”. The applicant is precluded from being paid any other fees for his or her services in respect of any aspect of the administration of the estate whether characterised as professional (legal) work or non-professional work.
[30] Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280 at 288.
[31] Collector of Customs v Cliffs Robe River Iron Associates (1985) 7 FCR 271 at 275.
[32] Collector of Customs v Cliffs Robe River Iron Associates (1985) 7 FCR 271 at 275.

The Will provides there is to be a payment of commission for the applicant’s time and trouble and his own professional services, and he may then incur separate legal expenses. In the absence of express provision in a will generally an executor is not entitled to charge the estate for work performed by him, whether professional or non-professional. However, the applicant in this case is entitled to the payment of commission by way of lump sum and the use of the word “initial” suggests that it may be paid prior to the completion of the administration of the estate. The applicant is also entitled to retain solicitors, the costs of which is to be paid out of the estate. The terms of clause 15 do not expressly address the circumstance of whether the applicant, in retaining solicitors, is able to retain the firm of which he is a member or has an indirect interest. While the applicant is expressly prohibited by clause 15 from being paid for his or her services, the Will does not expressly prohibit him being paid for the services of others. However, the act of retaining the law firm may constitute a breach of trust or a breach of fiduciary duty. In Chick v Grosfeld (No 3) White J said:[33]
Nor is the executor entitled to engage, for remuneration, a firm of which he or she is a member if he or she would thereby directly or indirectly benefit from the engagement. This follows from the rule that unless the trust instrument or will so provides, or the beneficiaries being sui juris give their informed consent, a fiduciary cannot place himself or herself in the position of conflict or sensible possibility of conflict between his or her personal interests and fiduciary duty.
[33] [2012] NSWSC 1536 at [8].
The issue is whether either of the qualifications apply. There being over 50 beneficiaries it is not practicable for the applicant to try and obtain the informed consent of all of them to the retainer of the law firm. On the other hand, it is at least arguable that the text of clause 15 of the Will which expressly empowers the testator’s trustee to engage “such legal accounting or other professional services as he shall in his absolute discretion deem necessary” makes provision for the retention of the law firm in what otherwise would be a breach of duty. In my view, the “discretion” conferred on the applicant by clause 15 affords him the power to instruct his own firm if he deems such instruction necessary for the proper administration of the estate.
In such circumstances, and provided that I am satisfied that the Will does not expressly prohibit the retention of the law firm, even if it is in breach of duty, I may sanction the retainer of the law firm. In Lewin on Trusts[34] the learned authors state:
If a question arises of a trustee entering into a transaction which would or might involve a breach of the profit rule or the conflict rule, then plainly it would be open to the trustees to seek the directions of the court. We consider that on such an application the court has jurisdiction both … to give directions to the trustees in their capacities as such not to enter the transaction, and … to give the trustee liberty to enter into the transaction in retaining the profit made without being liable to account. The court would be likely to exercise jurisdiction only if satisfied that (a) it is not in the interests of the trust fund for the trustees to enter into the transactions in their capacities as such … (b) it is in the interests of the trust fund for the trustee to enter into the transaction on his own account … and (c) the trustee is not willing to do so if made liable to account.
[34] (19^th ed. 2015) para [20-096].
Such a direction may be given pursuant to s 69 of the Act.
What is at issue here is whether it is in the interests of the beneficiaries for the applicant to retain his law firm, as distinct from another firm. The applicant has made clear that he does not propose to continue to retain the law firm if he is made liable to account for any profits earned by him back to the estate.
The evidence demonstrates that the applicant has completed a variety of work, including efforts to wind up the partnership, the company, liaising with partners, directors and shareholders, maintaining contact with the beneficiaries and managing the personal effects of the deceased. The administration of the estate is progressing swiftly considering its size and complexity. There is no doubt that the applicant requires the assistance of a firm of solicitors in relation to the administration of the estate. The estate is large and complex. Due to its size and nature there is significant work involved in the realisation of assets and the earning of income due to, inter alia, the partnership, the farming business, the share portfolio and the extent of personal effects of the deceased. The administration involves both legal and non-legal tasks. In particular, the management of the company, the partnership and the distribution of numerous personal effects require regular consideration and judgement. The applicant is required to bear a substantial responsibility as the assets of the estate are of high value, require attention and the exercise of judgment, care and skill by more than one person. Accordingly, the cost of retaining a law firm is an expense that the estate will have to incur.
In my view there is no obvious reason why the applicant should not retain his law firm, as opposed to some other firm of comparable size. On the contrary, the retainer of the law firm may be to the beneficiaries’ advantage in that some of the professional work is being performed by the applicant, and therefore not separately charged. This would not be the position if another firm is retained.
The evidence satisfies me that the applicant is closely monitoring the costs incurred by the law firm. While the fees charged by the law firm are slightly above the scale rate in respect of skilled work, having regard to the scale of costs allowed by the Court, the amount being charged by the law firm is well within commercial rates, i.e. the Scale provides for an hourly rate of $386.10 for work involving skill. The principal solicitor doing the estate’s work is charging $418 per hour.
This raises the issue of the performance by the law firm of non-professional work.
The cost of the performance of executorial work by the law firm
In most states, other than South Australia, there is an express statutory provision entitling a trustee (which may include an executor) to employ and pay agents to generally perform executorial (non-professional) work.[35] In South Australia this topic is governed by the common law and equity. Generally, an executor is expected to carry out his or her duties, including keeping accounts, personally.[36] There is no restriction on the lawfulness of an executor employing an agent per se. The effect of the general rule is that, if an executor retains an agent, he or she shall not be able to be reimbursed from the estate for the costs incurred in doing so.
[35] For example, the Trustee Act 1962 (WA) s 53.
[36] In the Will of Douglas (1951) 51 SR (NSW) 282 at 283; Chick v Grosfeld (No 3) [2012] NSWSC 1536 at [7].
In In the Estate of Instone[37] Powell J said:[38]
… As a general rule, and subject to any provision to the contrary in his testator’s will … the executor is bound to keep accounts, and attend to his duties personally – it is for this reason that he is allowed commission – and that, except in the cases to which I will next refer, if he chooses to employ some other person to do the work which he should have done, he must pay that person himself, and cannot seek to charge the estate with the cost … Where, however, the nature of the work was particularly onerous, or such as to make it prudent to do so, the cost incurred by an executor in having the work done by another may be allowed …
[37] (Unreported, Supreme Court of New South Wales, Powell J).
[38] (Unreported, Supreme Court of New South Wales, Powell J) at [25].
In Chick v Grosfeld (No 3), White J said:[39]
If he or she chooses to employ another person to carry out executorial tasks, the charges will be to his or her own account.
[39] [2012] NSWSC 1536 at [7].
In In the Will of Douglas,[40] a Registrar had disallowed some charges on a solicitor’s bill in respect of work of a non-professional nature. On review, Roper J reiterated the general rule:[41]
It is clear that the Registrar’s decision that the work done was of a non-professional nature is correct. It is work which a solicitor is quite competent to do and which he frequently does; but it requires no special or professional skill and could well have been done by the executors personally. In general an executor will not be allowed out of the estate charges of his solicitor for doing things which he ought strictly to have done himself.
[40] (1951) 51 SR (NSW) 282.
[41] (1951) 51 SR (NSW) 282 at 283.
Roper J went on to hold that, on the proper construction of the will in question, such charges were allowed.[42]
[42] (1951) 51 SR (NSW) 282 at 284.
In Swanson v Emmerton,[43] the will expressly appointed one of the executors “to be the solicitor of my trust property”, and permitted him to charge for both professional and non-professional work.[44] The executor, Mr Emmerton’s firm, was engaged to perform non-professional work. Cussen J held:[45]
Were the trustees just failing employing the firm to assist the trustees in keeping the accounts and collecting the rents, and in charging the estate with the payment of such assistance? This is a question of fact, in my opinion, and the only test to apply is that of reasonableness. I think, having regard to the magnitude and nature of this estate as disclosed by the evidence, to the nature of the trusts of the will, necessity of keeping and having in substance always ready properly-kept accounts and, so far as it is permissible to do so, to the number and personality of trustees, that it was reasonable for the trustees to employ others to keep the accounts of the estate, and incidentally, and as a step towards conveniently keeping the accounts, to collect or receive the rents from the various properties. I must not be taken as laying down any general rule on the subject, as I have simply come to a conclusion of fact with reference to this estate. If the trustees were justified for the reasons abovementioned in employing others to assist them, it follows that they were justified in payment them and in charging a reasonable sum for such payment against the estate.
[43] [1909] VLR 387.
[44] [1909] VLR 387 at 389-390.
[45] [1909] VLR 387 at 390-391.
Pursuant to the terms of clause 15 of the Will the applicant is entitled to a commission equal to 1 per cent of the gross value of the estate, i.e. $282,743.90.[46]
[46] This may increase if the value of the gross estate increases.
I accept that clause 15 confers a discretion on the applicant to employ professionals. The estate is large and its administration is complex. It requires a significant amount of both professional and executorial work. In an estate of such size and complexity, the applicant would be justified in employing such professionals to carry out some non-professional work. In Re Sleight[47] Bowen LJ explained that:[48]
[I]n the administration of a trust a trustee cannot do everything himself – he must to a certain extent make use of the arms, legs, eyes, and hands of other persons, and the limit within which it seems to me he is confined has been described …
[47] (1883) 22 ChD 727.
[48] (1883) 22 ChD 727 at 763.
The applicant submits that there is nothing express in the Will that suggests the cost of employing agents to do executorial work should be borne by him. The only charge that he is expressly required to bear under clause 15 is the cost of insurance. He contends it is implicit that all other charges will be borne by the estate. These would include the cost of solicitors performing non-professional work. Further, he submits that if he was unable to employ agents it would delay the administration of the estate.
I do not accept these submissions. The deceased has made a substantial provision for the payment of commission to the applicant for the performance of his executorial duties. In my view that gives rise to an inference that the applicant is not permitted to be reimbursed for the cost of agents performing executorial work. This construction of the Will is supported by the text of clause 15 which provides that the applicant is “entitled to a once only initial commission… out of which monies [he] shall bear the cost of … carrying out the administration of [the] estate … and [he] shall not be entitled to charge or be paid any other fees for his … services in connection with this my Will or the trusts.” That is the effect of the principle explained in In the Estate of Instone and in In the Will of Douglas. Swanson v Emmerton was a decision on its own facts. It does not stand for any broad principle. Starke v James is distinguishable from this case because in that case there was no charging clause. While this case concerns a substantial and complex estate, the deceased has made express provision for the payment to his executor of a very large commission for his work in the administration of the deceased’s estate.
The inability of the applicant to charge the estate for the performance of non‑professional work by agents need not delay the administration of the estate. At issue is not whether agents can be engaged to perform executorial work, but rather whether payment for such work is to be met by the estate or by the executor.
In the circumstances the applicant must take steps to reimburse the estate for the previous charges the estate has met for the performance by the law firm for non‑professional work.
Conclusion
I direct pursuant to s 69 of the Act that the applicant, in his capacity as executor of the estate of Peter McBride, late of 421 The Parade, Kensington Gardens in the State of South Australia, who died on 24 July 2018 (the deceased), on the proper construction of clause 15 of the Will of the deceased, would be justified in:
1retaining Camatta Lempens Pty Ltd to perform legal work for and on behalf of the deceased’s estate on a fee for service basis, provided that Camatta Lempens Pty Ltd does not charge the estate for any work (whether legal or executorial) done by him; and
2claiming and receiving his executor’s commission in clause 15 of the Will of the deceased, despite having retained Camatta Lempens Pty Ltd in accordance with paragraph 1 above.
I further direct pursuant to s 69 of the Act that the applicant, in his capacity as executor of the estate of Peter McBride, late of 421 The Parade, Kensington Gardens in the State of South Australia, who died on 24 July 2018 (the deceased), on the proper construction of clause 15 of the Will of the deceased, would not be justified in charging the estate for the performance by his agents of any executorial work for and on behalf of the deceased’s estate. I direct he is to reimburse the estate for the charges the estate has met for the performance by the law firm of the non-legal work.
I further direct that the costs of the application be paid out of the deceased’s estate, such costs to be adjudicated on the footing of an indemnity.