In the Estate of RAYMOND FRANCIS STUART (DECEASED)

[2009] SASC 399

SUPREME COURT OF SOUTH AUSTRALIA

(Testamentary Causes Jurisdiction)

In the Estate of RAYMOND FRANCIS STUART (DECEASED)

[2009] SASC 399

Judgment of The Honourable Justice Gray

23 December 2009

SUCCESSION - WILLS, PROBATE AND ADMINISTRATION - PROBATE AND LETTERS OF ADMINISTRATION - ALTERATION AND REVOCATION OF GRANTS - IN WHAT CIRCUMSTANCES - OTHER CASES

SUCCESSION - WILLS, PROBATE AND ADMINISTRATION - PROBATE AND LETTERS OF ADMINISTRATION - ALTERATION AND REVOCATION OF GRANTS - ON WHOSE APPLICATION

SUCCESSION - WILLS, PROBATE AND ADMINISTRATION - PROBATE AND LETTERS OF ADMINISTRATION - JURISDICTION AND DISCRETION OF THE COURT - SOUTH AUSTRALIA

Grant of probate of estate of deceased husband to third wife and two daughters of an earlier marriage as executors and trustees - dispute between executors - breakdown of relationship of executors - significant delay in administration of estate - application by executors for revocation of grant of probate and for grant of new probate in favour of daughters and not wife - consent of all parties - whether appropriate to revoke grant in the circumstances - consideration of cases where revocation appropriate.

Held: the due and proper administration of the estate is frustrated by the relationship of the executors - previous grant of probate revoked - fresh grant of probate to be granted.

Inheritance (Family Provision) Act 1972 (SA); Supreme Court Act 1935 (SA) s 18; Administration and Probate Act 1919 (SA) s 5, referred to.
In the Goods of Loveday [1900] P 154; Bates v Messner (1967) 67 SR (NSW) 187; In the Estate of Edwards (1982) 28 SASR 380; Executor Trustee Australia Ltd v Henderson (2006) 244 LSJS 43; Re Galbraith [1951] P 422; Re Hoare (1833) 2 Sw & Tr 361; Warren v Milsom [1919] NZLR 737; Shaw v Thomas [1954] NZLR 585; In the Estate of Cope [1954] 1 WLR 608; In the Estate of Koch (1988) 144 LSJS 409; In the Estate of Crane (2005) 93 SASR 198; Mavridos v Mack (1998) 45 NSWLR 80, considered.

In the Estate of RAYMOND FRANCIS STUART (DECEASED)
[2009] SASC 399

Testamentary Causes Jurisdiction

GRAY J.

1. This is an application to revoke a grant of probate and for a fresh grant of probate to be issued.

2. Raymond Francis Stuart, the deceased, died on 20 September 2005, aged 66 years.  On 26 November 2007, probate was granted to the deceased’s third wife and widow, Mrs Heather Stuart, and his two daughters of an earlier marriage, Nicole Stuart and Andree Stuart.  Nicole and Andree issued proceedings under the Inheritance (Family Provision) Act 1972 (SA), seeking orders for further provision out of the estate. Mrs Stuart was a party to those proceedings. On 7 April 2009, those proceedings were resolved and a consent order made by a Master of this Court. That order dismissed the action, and made the terms of a compromise reached by the parties, a rule of court.

3. The terms of compromise included a requirement that the executors would join together in an application to revoke the original grant of probate and for a fresh grant of probate to be issued in favour of Nicole and Andree, but not Mrs Stuart.

4. The terms of compromise provide, inter alia:

   Subject to the payment of the said sum and [interest thereon (if any)] and the delivery of the items to the Third Named Defendant as aforesaid (“the conditions”) the Third Named Defendant agrees to do all things and sign all documents necessary or desirable to have the Grant of Probate made to Heather Anne Stuart, Nicole Louise Stuart and Andree Joanne Stuart on the 26^th day of November 2007 (“The Original Grant”) revoked and be declared null and void to all intentions and purposes in law whatsoever and for Probate of the will of the deceased dated the 29^th day of July 2004 (“the will”) thereafter be granted to Nicole Louise Stuart and Andree Joanne Stuart both of One Tree Hill Road Kersbrook daughters of the deceased.

   Upon the satisfaction of the conditions Nicole Louise Stuart and Andree Joanne Stuart agree to do all things and sign all documents necessary or desirable to have the Grant of Probate made to Heather Anne Stuart, Nicole Louise Stuart and Andree Joanne Stuart on the 26^th day of November 2007 revoked and be declared null and void to all intentions and purposes in law whatsoever and for Probate of the will of the deceased dated the 29^th day of July 2004 thereafter be granted to them Nicole Louise Stuart and Andree Joanne Stuart both of One Tree Hill Road Kersbrook daughters of the deceased.

5. That application was made to the Registrar of Probates, who referred it to this Court, as there is some uncertainty as to the jurisdiction to revoke a grant of probate on the application of the executors to whom the grant has been made.

6. The Supreme Court has power to revoke grants of probate and letters of administration pursuant to section 18 of the Supreme Court Act 1935 (SA)[1] and section 5 of the Administration and Probate Act 1919 (SA).[2]  The power also forms part of the inherent jurisdiction of the Court.[3]

   [1]    The court shall, in relation to probates and letters of administration, have the following jurisdiction, that is to say:

   (a)The like voluntary and contentious jurisdiction and authority in and for the State in relation to the granting or revoking of probate of wills, and administration of the effects of deceased persons, as was vested in or exercisable by the Court of Probate established in England under the Court of Probate Act 1857, together with full authority to hear and determine all questions relating to testamentary causes and matters:

   (b)The like jurisdiction and powers with respect to the real estate of deceased persons as it has with respect to the personal estate of deceased persons:

   (c)All probate jurisdiction which, under or by virtue of any enactment not repealed by this Act, is vested in or capable of being exercised by the court.

   [2](1)  The like voluntary and contentious jurisdiction and authority as immediately before the coming into operation of this Act belonged to or were vested in the Supreme Court, in relation to granting or revoking probate of wills and letters of administration of the effects of deceased persons, shall be vested in and exercised by the said Court in relation to granting or revoking probate of wills and letters of administration of the estate, as well real as personal, of deceased persons within the said State; and the Court shall have the same power of granting probate or administration, where the only estate within the State consists of realty, as if such estate comprised both realty and personalty.

   (2)The said Court shall also have and exercise the like powers, and its grants and orders shall have the like effect within the said State, in relation to the real and personal estate therein of deceased persons, as immediately before the coming into operation of this Act the said Court and its grants and orders respectively had within the said State, in relation to those matters and causes testamentary, and those effects of deceased persons, which were within the jurisdiction of the said Court.

   (3)All duties which by statute or otherwise were, immediately before the coming into operation of this Act, imposed on or to be performed by the said Supreme Court in respect to probates, or administrations, or matters or causes testamentary within its jurisdiction shall continue to be performed by such Court within the said State.

   [3]    In the Goods of Loveday [1900] P 154; Bates v Messner (1967) 67 SR (NSW) 187.

7. Also forming part of the terms of compromise was an agreement that Nicole and Andree pay Mrs Stuart the sum of $207,500.00, and deliver to her some named personal items.  In substance, the clause mandating an application for revocation of the earlier grant of probate was conditional upon the satisfaction of these two terms. 

8. The widow and the children of the deceased have deposed that irreconcilable differences between them have inhibited their ability as executors to properly administer the estate of the deceased.  This has led to significant delays in the administration of the estate.

9. It was contended by the children of the deceased that their relationship with the widow was irretrievably damaged in such a way that they are incapable of completing the administration of the estate of the deceased.   It was further contended that the delay and inhibition in the administration of the estate is a sufficient and proper basis for revoking the grant of probate and the making of a new grant to a differently constituted group of executors.  Counsel for the applicants emphasised the consent of the affected parties in this case and submitted that the facts of this case were analogous to those in the past where Courts have relieved grantees of their duties.

10. It was further contended that the revocation order sought would recognise the finalisation of the widow’s interest in the estate and the desire of the parties to permit the daughters of the deceased who are the remaining beneficiaries of the estate to complete the administration.

    Revocation of grant of probate and letters of administration

11. Authorities indicating that the English Courts are reluctant to exercise their discretion to revoke a grant of probate or letters of administration were brought to this Court’s attention. Counsel for the applicants acknowledged the following proposition from Mortimer on Probate Law and Practice, and the references contained therein:[4]

    [I]f the administration has been properly granted, it will not be revoked even on the application of the administrator himself; nor is the consent of all parties interested, the fact that the administrator has done no act under the grant, or a mere suggestion that it will benefit the estate, sufficient to justify the revocation of such a grant and a fresh grant to another person.[5]

    [4]    C Mortimer and H Coates, Mortimer on Probate Law and Practice (2^nd ed, 1927) at 428.

    [5]    Heslop (1846), 1 Rob. 457. In Dye (1850), 2 Rob 342, where probate has been lawfully granted to an executor and to an executrix, who was a married woman, and the Bank of England refused to allow a transfer of stock in the absence of the husband of the executrix, who had deserted her, the probate was revoked and re-granted to the executor alone. In this case the executrix had not intermeddled with the estate. And in Ferrier (1828), 1 Hagg. 241, where administration limited to a particular property was granted to the tenant for life, and he assigned his interest to his son, and asked that the grant might be revoked and a fresh grant made to the son limited to that particular property, the grant was revoked, although the administrator had intermeddled with the property. But in Reid (1886), 11 P. D. 70, Butt, J., refused to revoke a general grant of administration where the administratrix had intermeddled with the general estate, and to make a fresh grant to another person, although similar grounds to those shown in Dye, supra, appeared and his decision was upheld by the Court of Appeal on the ground that there was no precedent for such an order. See, however, Thacker, [1900] P. 15; Hoare (1833), 2 Sw. & Tr. 361 n.

12. However, Tristram and Coote’s Probate Practice states:[6]

    Where a grant has been properly made, but has subsequently become ineffective and useless; or which, if allowed to subsist, would prevent the proper administration of the estate.

    [6]    R D’Costa, J Winegarten and T Synak, Tristram and Coote’s Probate Practice (30^th ed, 2006) at 611 and 614.

13. …

    Application is occasionally made for revocation on the ground that the grantee, though not incapable, wishes to be relieved of his responsibility for some reason, such as increasing age. Such an application is allowed only by express direction of a district judge or registrar, which is not readily given.

14. In the Estate of Edwards[7] involved an action for the revocation of a grant of probate that had been made in common form, and for a grant of probate in solemn form, on an earlier will.  At issue in that case was the validity of the common form, later will.  Sangster J, reflecting on the passage from Mortimer on Probate Law and Practice extracted above, observed:[8]

    I have, however, endeavoured in the short time available to me to trace the reason for that kind of statement: that there must have been some justification for it was clear enough from the number of authorities referring to the point. See, for example, Drummond v. Knight, a case where all the interested parties consented to revocation but the Court refused in the absence of affidavits stating all the facts. So far as I have been able to ascertain it, the origin, or at least one of the origins, of that kind of statement lies in the fact that probate or letters of administration in common form, that is to say in non-contentious business, would have been granted by an official of the ecclesiastical courts known as the Ordinary, but that official did not have the jurisdiction to deal with contentious proceedings for a declaration of the invalidity of a will on grounds such as in the case now before me. In a very old case, reported without the name of the case, it was held that once probate or administration has been granted by the Ordinary, unless his act was completely void, he was functus officio and thus had no authority to revoke what he had done.

    I am of the opinion that at least some of the statements to the effect of the one in Mortimer were based on a dichotomy of jurisdiction rather than an absolute requirement of evidence. For example, in Martyr v. Perry the plaintiff sought revocation of probate, and at the hearing the defendant, obviously having the onus of proof of the validity of the challenged will, sought an adjournment because his witnesses, who had been expected, were not then present; the Court refused the adjournment and revoked the grant. The report added, "without requiring any evidence to be given in opposition to the will". There was no dichotomy of jurisdiction at that time.

    I have examined a number of books and cases, none of which help my analysis of the problem, but it is interesting to notice that in Priestman v. Thomas, proceedings seeking the propounding of a will in solemn form went off by way of compromise under which a later will was not proved but an earlier will was admitted to probate. I hasten to point out, however, that was a propounding of a will and not the revocation of a grant. In the second edition of Atkin's Court Forms and Precedents, vol. 32, pp. 210-211, there are forms for the revocation of a grant by consent, but again I hasten to point out that other books on probate practice in England would rather suggest that those forms relate to undisputed matters such as a probate obtained on the assumption that someone had died but who turned out to be still alive, or on the assumption that that was the last will and subsequently another will was found. Other books I have looked at have nothing relating to the problem with which I am dealing.

    [footnotes omitted]

    [7]    In the Estate of Edwards (1982) 28 SASR 380.

    [8]    In the Estate of Edwards (1982) 28 SASR 380 at 383.

15. Ultimately, Sangster J held that the Supreme Court had jurisdiction to revoke a grant of probate, without calling evidence, where all parties were sui juris and consented to the application. In arriving at this conclusion, his Honour observed:[9]

    On the whole I am of the opinion it is at least arguable that no cause need be shown in proceedings seeking revocation of a grant if all parties who could possibly be interested consent to that revocation, but I need not go so far as that and therefore I expressly refrain from deciding that question. It is sufficient for me to say that in my opinion even if a grant of probate may not be revoked without cause then nevertheless a grant may be revoked for cause which is alleged in the proceedings before the court and which allegations, if made out, would support the revocation, and where there is no suggestion that that allegation is other than bona fide; and that the court may do so without hearing any evidence in support of the alleged cause for revocation if all parties possibly interested in the outcome of the proceedings consent to the order.

    [emphasis added]

    [9]    In the Estate of Edwards (1982) 28 SASR 380 at 384.

16. In Executor Trustee Australia Ltd v Henderson,[10] not without some hesitation, Perry J followed Edwards.  In Henderson, the testator had made wills in both 1992 and 1993.  The defendant in that matter was the sole executor named in the 1993 will, and probate had been granted earlier in that form.  Due to claimed want of testamentary capacity, the validity of the 1993 will was at issue in those proceedings.  It was claimed that the deceased had executed her true last will in 1992, in which both the plaintiff, Executor Trustee, and the defendant, Mrs Henderson, had been appointed as joint executors. Before the court was an application for revocation of the grant of probate on the basis that the deceased had lacked testamentary capacity, together with an application for a grant of probate in solemn form on the 1992 will.

    [10]   Executor Trustee Australia Ltd v Henderson (2006) 244 LSJS 43.

17. It is instructive to note that the present case does not involve an issue as to the validity of the will.  Indeed, the parties want a further common form grant to be made in respect of the same will.  Further, there is no contention as to the validity of the original grant of probate.  Despite one of these issues not being alive in the present case, I have reached the conclusion that the Court may grant a revocation of a grant of probate when the due administration of the estate is frustrated by the relationship of the executors.

18. As earlier mentioned, it was submitted that grants of probate are occasionally revoked, subject to special circumstances being shown, where grantees wish to be relieved of their duties.[11]

    [11]   Counsel for the applicants in this matter relied on English authority for this proposition: Re Hoare (1833) 2 Sw & Tr 361; In the Goods of Galbraith [1951] P 422.

19. With respect to the revocation of a grant of letters of administration, the guiding principle is stated by Jeune P In the Goods of Loveday.[12]  Loveday concerned an application where the administrator of an estate could not be found.  It was said in that case that in exercising the jurisdiction to revoke a grant of administration, a court must have regard to the due and proper administration of the estate and the interests of the parties beneficially entitled to the estate: [13]

    …After all, the real object which the Court must always keep in view is the due and proper administration of the estate and the interests of the parties beneficially entitled thereto; and I can see no good reason why the Court should not take fresh action in regard to an estate where it is made clear that its previous grant has turned out abortive or inefficient.

    [12]   In the Goods of Loveday [1900] P 154 at 156; followed in In the Goods of Galbraith [1951] P 422; Warren v Milsom [1919] NZLR 737; Shaw v Thomas [1954] NZLR 585; In the Estate of Cope [1954] 1 WLR 608.

    [13]   In the Goods of Loveday [1900] P 154 at 156.

20. This statement of principle was cited with approval by the New South Wales Court of Appeal in Bates v Messner,[14] and applied by this Court in In the Estate of Koch[15] and In the Estate of Crane.[16]

    [14]   Bates v Messner (1967) 67 SR (NSW) 187.

    [15]   In the Estate of Koch (1988) 144 LSJS 409.

    [16]   In the Estate of Crane (2005) 93 SASR 198 (Besanko J).

1. Bates v Messner[17] involved an executor of an estate who had been granted probate, and who for six years had done almost nothing to ensure the proper administration of the estate.  The executor’s whereabouts became unknown, and misconduct on behalf of the executor was found.  Further, evidence was before the court suggesting that the executor’s personal circumstances militated against any future performance of his executorial duties.

   [17]   Bates v Messner (1967) 67 SR (NSW) 187 considered in In the Estate of Crane (2005) 93 SASR 198 at 204.

2. Where courts have been faced with novel cases, which do not fall squarely within the established grounds for revocation, the courts have returned to the fundamental principles dictating that the administration of the estate be a priority.  This observation is captured by the reasons of Asprey JA in Bates v Messner, where in citing the cases which have applied the Loveday principle, his Honour notes:[18]

   …[I]n the case of In the Goods of Galbraith the principle of the decision was expressly applied in revoking a grant of probate. Karminski J., at p. 424, said: “The application is a novel one only to this extent: there appears to have been no reported case in which both executors have been relieved of their duties in this way; but in the present case there is the clearest possible evidence that both the surviving executors are men of very advanced age and suffering from such a degree of physical and mental infirmity as makes a continuance of their duties impossible.” In Warren v. Milsom Cooper J. expressly applied the principle enunciated by Jeune P. when he inferred that an executor to whom probate had been granted but who had not performed his executorial duties for a period of eighteen months refused to administer the estate.  See also Shaw v. Thomas where again the same principle was applied by reason of the refusal of one executor (the sole beneficiary under the will) to cooperate with her other executors in the administration of the estate.

   [18]   Bates v Messner (1967) 67 SR (NSW) 187 at 190-191.

3. His Honour then went on to reason in the following way:[19]

   ... that the essential basis of the exercise of the court's inherent jurisdiction to revoke a grant of probate is that emphasised by Jeune P, namely, that the real object which the court must always keep in view is the due and proper administration of the estate in the interests of the parties beneficially entitled thereto on the part of the person to whom and by whose oath as to the faithful performance of his duties the court has been induced to entrust the office of executor. The terms used in some of the previously decided cases with relation to the circumstances which have given rise to the exercise of the jurisdiction of revocation, such as 'abortive', 'inefficient', 'useless' or 'ineffectual', are simply descriptive of a situation in which the court has been persuaded to the view that its grant, which was predicated on the oath of the executor named in the will that 'he will pay all the just debts and legacies of the said deceased so far as the estate of the said deceased will extend and the law shall bind him, and that he will otherwise well and faithfully administer the said estate according to law; and that he will render a just and true account of his administration' has been circumvented by a breach of that oath which is in effect an undertaking to the court making the grant. I shall make no attempt to define all circumstances which may attract the exercise of the court's jurisdiction, but where circumstances clearly appear to have arisen after a grant of probate which impel the court to the firm conclusion that the due and proper administration of an estate has either been put in jeopardy or has been prevented either by reason of acts or omissions on the part of the executor or by virtue of matters personal to him, for example, mental infirmity, ill health, or by virtue of the proof of other matters which establish that the executor is not a fit and proper person to carry out the duties which he has sworn to the court that he will perform, the court may exercise its inherent jurisdiction to revoke the grant.

   [19]   Bates v Messner (1967) 67 SR (NSW) 187 at 191-192.

4. The principles upon which the Court acts in determining whether to revoke a grant of probate or letters of administration were settled in New South Wales by the Supreme Court of New South Wales in Mavridos v Mack,[20] where Sheller J applied the foregoing dicta of Asprey JA in Bates v Messner, and observed:[21]

   …The question [is] whether the due and proper administration of an estate had either been put in jeopardy or had been prevented either by reasons of acts or omissions on the part of the executor or by virtue of matters personal to him, for example, mental infirmity, ill health, or by virtue of the proof of other matters which established that the executor was not a fit and proper person to carry out the duties he had sworn to perform. His Honour applied a far too rigid test by saying that one had to get close to the position of the grant being useless.

   [20]   Mavridos v Mack (1998) 45 NSWLR 80 (per Sheller JA, with whom Priestley JA and Beazley JA agreed).

   [21]   Mavridos v Mack (1998) 45 NSWLR 80 at 108.

5. More recently in In the Estate of Crane,[22] in considering what was appropriate when exercising jurisdiction to pass over an executor, Besanko J found appropriate the principle espoused in Loveday in the context of letters of administration, and confirmed in Bates v Messner in the context of a grant of probate.  Ultimately it was held that the guiding principle is that regard must be had to the due and proper administration of the estate and the interests of the parties beneficially entitled thereto.

   [22]   In the Estate of Crane (2005) 93 SASR 198.

   Conclusion

6. The Court will not readily revoke a grant of probate when its grant was valid.  Equally however, I have arrived at the view that the Court should not to allow the proper administration of an estate to continue to be frustrated to a degree such as that in the within matter.  Where the proper administration of the estate is frustrated by, in effect, the dereliction in the duty to administer the estate, the revocation is warranted.  This is particularly so where there is consent of all the parties to that course.  Accordingly, a grant of probate may be revoked on the application of the executors who took the grant in order to allow for the due and proper administration of the estate, where, as in this case, there exists a near impossibility of that eventuating by virtue of the relationship of the executors.

   Orders

   -I revoke the grant of probate in favour of Heather Anne Stuart, Nicole Louise Stuart and Andree Joanne Stuart dated 26 November 2007.

   -I direct the Registrar of Probates to make a fresh grant of probate in favour of Nicole Louise Stuart and Andree Joanne Stuart.

   -I direct that minutes of order be prepared to give effect to the above order.