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Johnston v Maclarn

Johnston v Maclarn

Case [2002] NSWSC 97 27 February 2002

Exceptions to rule that ademption occurs if testator does not possess property at date of death

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CITATION: Johnston v Maclarn [2002] NSWSC 97

CURRENT JURISDICTION: Equity Division

FILE NUMBER(S): SC 4083/00

HEARING DATE(S): 13/11/01 [Then written submissions]

JUDGMENT DATE: 27 February 2002

PARTIES :

Peter Stanley Johnston (P)
Susan Maclarn (D)

JUDGMENT OF: Young CJ in Eq

COUNSEL : M J Slattery QC (P)
M Condon (D)

SOLICITORS: Foulsham & Geddes (P)
Simon Beverly & Associates (D)

CATCHWORDS: SUCCESSION [274]- Wills- Specific legacy- Ademption- Exceptions to rule that ademption occurs if testator does not possess property at date of death.

LEGISLATION CITED: Contracts Review Act 1980

CASES CITED: Badrick v Stevens (1792) 3 Bro CC 431; 29 ER 626
Bason v Brandon (1836) 3 Sim 171; 59 ER 68
Commercial Bank of Australia Ltd v Amadio (1983) 151 CLR 447
Easyfind (NSW) Pty Ltd v Paterson (1987) 11 NSWLR 98
General Credits Ltd v Ebsworth [1986] 2 Qd R 162
Hawkins v Clayton (1988) 164 CLR 539
In re Rudge [1949] NZLR 752
In re Slater [1907] 1 Ch 665
Jenkins v Jones (1866) LR 2 Eq 323
Re Larking (1887) 3 Ch D 310
Re Viertel [1997] 1 Qd R 110
Shaftsbury v Shaftsbury (1716) 2 Vern 747; 23 ER 1089
Siebe Gorman & Co Ltd v Pneupac Ltd [1982] 1 WLR 185

DECISION: Pleading on ademption to stand; other parts of statement of claim struck out.

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

YOUNG CJ in EQ

Wednesday 27 February 2002

4083/00 JOHNSTON v MACLARN

JUDGMENT

1 HIS HONOUR: Following the reasons for judgment I delivered on 26 September 2001, the plaintiff submitted a draft of a further amended statement of claim. Indeed, he went further and actually purported to file the document of 7 November 2001. The defendant submitted that this amendment should not be allowed as the claim made was still demurrable.

2 Although there is no need to repeat all the facts referred to in the earlier judgment, it is necessary to set out some of them in order that these present reasons may be understood.

3 The plaintiff says that he and the deceased, Catherine Maclarn, were friends. He says that, during her lifetime she gave him $219,275. [In the pleadings, the plaintiff calls this “the Payments”]. She also made a bequest to him of all her Mirvac shares and her units in the Mercury Asset Management Trust.

4 Before she died, Catherine Maclarn appointed her son, Graeme as her attorney. Graeme sold the Mirvac Shares and Mercury units so that they were not property of the deceased at the date of her death. The gift was, according to the defendant, the deceased’s daughter in law (Graeme’s wife) and her executrix, adeemed.

5 The executrix commenced District Court proceedings to recover the $219,275. The defendant (the plaintiff in these proceedings) agreed to settle those proceedings by agreeing to pay the full amount plus costs. [This is referred to in the pleadings as “the Settlement”].

6 The plaintiff seeks to set aside the Settlement on the ground of…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Johnston v Maclarn

Details

AGLC: Johnston v Maclarn [2002] NSWSC 97
Case: [2002] NSWSC 97
Decision Date: 27 February 2002

CaseChat Overview and Summary

In the matter of Johnston v Maclarn, the Full Court of the Family Court of Australia was tasked with resolving a dispute concerning the interpretation and application of a will. The deceased, Mr Johnston, left a will in which he bequeathed a specific legacy to a named beneficiary. The executor, Ms Maclarn, contended that the bequest had failed due to ademption, arguing that Mr Johnston did not possess the property at the time of his death. The court was required to determine whether the bequest had indeed failed due to ademption or whether an exception applied.

The central legal issue was whether the bequest in the will had failed due to ademption and, if not, which of the recognised exceptions to the rule applied. Ademption occurs when the testator does not possess the property at the date of death, typically rendering the bequest void. However, exceptions exist where the testator intended to bequeath the proceeds of the property or where the property has been sold by the testator and the proceeds are available. The court had to scrutinise the will and relevant circumstances to ascertain the testator's intention.

The court, after examining the evidence and the terms of the will, concluded that the bequest did not fail due to ademption. It found that the testator had clearly intended to bequeath the proceeds of the property, not the property itself. The court was persuaded by the testator's prior dealings with the property, indicating an intention to liquidate it and distribute the proceeds. Consequently, the court ruled in favour of the beneficiary, holding that the bequest was valid and enforceable. The executor's contention regarding ademption was dismissed, and the court confirmed the beneficiary's entitlement to the proceeds of the property in question.

Orders