Kay v Kreis

Case [2018] QCA 128

SUPREME COURT OF QUEENSLAND

CITATION:

Kay & Anor v Kreis [2018] QCA 128

PARTIES:

YVONNE MARIE KAY
(first appellant)
ALBERT DEVIVO
(second appellant)
v
GINA MARY KREIS (as executor of the Will of MARIO ALFRED DEVIVO)
(respondent)

FILE NO/S:

Appeal No 8171 of 2017
SC No 11988 of 2016

DIVISION:

Court of Appeal

PROCEEDING:

General Civil Appeal

ORIGINATING COURT:


Supreme Court at Brisbane – [2017] QSC 151

DELIVERED ON:

19 June 2018

DELIVERED AT:

Brisbane

HEARING DATE:

14 March 2018

JUDGES:

Fraser and Gotterson JJA and Boddice J

ORDER:

The appeal be dismissed with costs.

CATCHWORDS:

SUCCESSION – FAMILY PROVISION – PROCEDURE – TIME FOR MAKING APPLICATION – EXTENSION OF TIME – GENERAL PRINCIPLES – PARTICULAR GROUNDS FOR EXTENSION OF TIME – where the appellants sought an extension of time within which to make an application for family provision – where s 41(8) of the Succession Act 1981 (Qld) provides that any application for family provision must be commenced within nine months of a testator’s death, unless the Court exercises its discretion to extend time – where the appellants were refused an extension of time at first instance – where the appellants failed to bring the claim within that time –where the appellants had been provided legal advice of the limitation period applicable to the family provision claim – where the appellants made an application for extension of time almost 10 years after they became aware of their right for family provision – where some assets of the estate were located in Italy and others were located in Australia – where the appellants filed caveats to oppose the grant of probate – where the appellants received legal advice that such caveats were not a proper mechanism to seek family provision – where the primary judge refused to grant an extension of time – whether the primary judge erred in the exercise of that discretion – where the primary judge considered factors of prejudice, unconscionable conduct, delay, and justice – where the weight to be given to those factors was a matter for the primary judge – where the primary judge determined delay was the primary issue – where no error was established by the appellants

Succession Act 1981 (Qld), s 41(8)

Hills v Chalk [2009] 1 Qd R 409; [2008] QCA 159, cited
House v The King (1936) 55 CLR 499; [1936] HCA 40, applied
Spencer v Burton  [2016] 2 Qd R 215; [2015] QCA 104, cited

COUNSEL:

No appearance for the first appellant
The second appellant appeared on his own behalf
J A Sheean for the respondent

SOLICITORS:

No appearance for the first appellant
The second appellant appeared on his own behalf
Blake Topping Solicitors for the respondent

  1. FRASER JA:  I agree with the reasons for judgment of Boddice J and the order proposed by his Honour.

  2. GOTTERSON JA:  I agree with the order proposed by Boddice J and with the reasons given by his Honour.

  3. BODDICE J:  On 17 November 2016, the appellants filed…

Continue reading Kay v Kreis

Sign in free to access the full text

Details
AGLC
Kay v Kreis [2018] QCA 128
Case
[2018] QCA 128
Decision Date

CaseChat Overview and Summary

In the case of Kay v Kreis, the appellants, who are the children of the deceased, sought an extension of time to make an application for family provision under the Succession Act 1981 (Qld). The primary issue before the court was whether the primary judge's refusal to grant an extension of time was erroneous. The appellants contended that the primary judge's decision was flawed, either by an error of law or fact, or by an improper exercise of discretion. The court was required to consider whether the primary judge had overlooked significant evidence, misapplied legal principles, or failed to adequately weigh the relevant factors in determining whether to grant an extension of time.

The court examined the primary judge's reasoning and concluded that the primary judge had carefully considered the relevant factors, including the delay in bringing the application, any prejudice caused by the delay, any unconscionable conduct by the applicants, and the prospects of success of the substantive application. The court found that the primary judge had given appropriate weight to each of these factors and had reached a decision that was reasonably open on the evidence. The appellants' argument that the primary judge had made an error of law or fact in finding that the male appellant had deliberately sent the proceeds of the sale of the deceased's house to Italy to evade those funds forming part of the deceased's estate was rejected, as there was ample evidence to support the primary judge's conclusion. The court also noted that the primary judge's assessment of the male appellant's credibility did not improperly affect the conclusion regarding the inadequacy of the appellants' explanation for the delay in bringing the application.

Ultimately, the court found that the primary judge had exercised their discretion properly and that no error had been established in the exercise of that discretion. The appeal was dismissed, and the decision of the primary judge was affirmed. The court ordered that the appeal be dismissed with costs.

Orders

Orders of the court

The appeal be dismissed with costs.

Background

Background to the litigation

The appellants appeal against that decision. At issue is whether the primary judge’s discretion miscarried by reason of errors of fact and law.Background The appellants are the children of the deceased. The respondent is their half-sister. By his Will, made on 9 April 2001, the deceased appointed the respondent as his executor and made her sole beneficiary of his estate. An addendum to the Will explained that decision on the basis of the respondent’s needs, the conduct of the appellants’ mother, the appellants’ distant treatment of the respondent and previous assistance the deceased had given the appellants through employment in a family business. On 25 July 2001, the deceased suffered a severe stroke. He was left with significant disabilities. As a consequence, he was admitted to an aged care facility. On 11 May 2005, the then Guardianship and Administration Tribunal appointed the male appellant administrator of the deceased’s financial affairs. Prior to that appointment, the male appellant had held an appointment as the deceased’s attorney, pursuant to an Enduring Power of Attorney, dated 18 November 1994. On 10 July 2004, the male appellant sold the deceased’s house at Bardon. The proceeds of that sale were invested in a high interest account. On 2 December 2006, shortly before the death of the deceased, the male appellant transferred those funds to an Italian bank account. The reason given for that transfer was in order to secure an aged care facility placement in Italy for the deceased. At the date of the deceased’s death, the deceased held monies in an Australian bank account, a solicitor’s trust account and the funds in the Italian bank account. The deceased also owned a half share in an apartment in Italy and two motor vehicles.Proceedings In February 2007, the respondent filed an application for a grant of Probate of the Deceased’s Last Will. The male appellant filed a caveat opposing that grant. On 26 February 2007, the male appellant filed a notice in support of the caveat. It identified the claimed interest in the estate under “the Family Provision Act”, by virtue of his position as son of the testator. The notice indicated the male appellant required the Will to be proven in solemn form, on the ground he was one of the testator’s next of kin. In response to that notice, the respondent’s then solicitors advised the male appellant that if he wished to make an application for family provision he would need to commence separate proceedings under the Succession Act 1981 (Qld). They suggested the caveat be withdrawn to allow probate of the Will to be obtained, undertaking in that event not to distribute the estate until resolution of the claim for family provision. That letter notified the male appellant expressly of the necessity for any such application to be filed within nine months of the date of the testator’s death. By this stage, the appellants had obtained legal advice to the effect that they would have difficulties in challenging testamentary capacity, but they could file family provision claims. They were given an estimate of legal costs of $81,000, if the matter went to trial and were warned of the risks of an adverse costs order. The male appellant had also spoken to an officer at the Italian Consulate who informed him that “foreign assets in the estate might not be transferable to Australia”. There was an estimate of additional legal costs if they sought advice on that issue. The appellants were advised by the solicitors of the need to give notice within six months of death of an intention to commence a family provision application and of the nine months limitation period within which to commence such an application.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Subsequent to those events, the male appellant received legal advice to the effect that the caveat was not a proper mechanism to seek family provision. He was advised to file an originating application for family provision. In accordance with that advice, the appellants filed the application for an extension of time.Primary decision At the hearing of the application, the respondent conceded, for the purposes of the application, that the appellants had an arguable case for family provision. The application was accordingly determined on the basis of whether, having regard to any prejudice, unconscionable conduct or delay, justice required the granting of the extension of time. In respect of prejudice, the primary judge accepted no prejudice arose by reason of distribution of the estate’s assets because nothing had been done in the administration of the estate until very recently. There was however, general prejudice which arose from the lapse of time, with difficulties of fading recollection and loss of records. That prejudice was considered to be relevant, but not a decisive consideration in determining what justice required in the case. Similarly, the primary judge concluded the issue of unconscionability was not decisive in any determination of the case. The primary issue was delay. In respect of delay, the primary judge noted that the appellants said they were not in a financial position to commence a proceeding and they had taken reasonable steps by filing caveats in order to bring the dispute before the court. The primary judge did not accept those explanations represented a satisfactory explanation for the inordinate delay. The fee estimate received by the appellants was a worse-case scenario and the respondent’s solicitors had indicated a willingness to negotiate provided the caveats were removed. Further, it is not correct that the appellants only became aware in 2016 of the need to file a different application. The respondent’s solicitors had helpfully given that advice in 2007, referring specifically to the Succession Act and advising of the relevant time limits. The male appellant had also received similar advice in February 2008. Against that background, the appellants could not have a justifiable belief that the caveats somehow constituted an application for provision. It was far more likely the appellants did not proceed with any application because they did not think it was worthwhile. They were content to thwart the respondent’s attempt to obtain probate, thus preventing her from getting access to the limited part of the estate, comprised by the accounts held in Australia, while under the impression they would ultimately share in the far more substantial assets held in Italy. The primary judge found that what had triggered the current action was the realisation that the funds in Italy were at risk of forfeiture and formed part of the Australian estate. The appellants’ hope or expectation that they would be entitled to a share of the Italian funds, in circumstances where the male appellant had moved those funds out of the jurisdiction and withheld information as to the account, and where both appellants were actively preventing the obtaining of probate, did not justify their failure to make the application for provision within time. Further, as both appellants knew of their right to apply for family provision as early as February 2007, and of the relevant time limits, there was no compelling explanation of why they could not have found the means to make the application within time.

Ratio Decidendi

Legal Principle Established

The respondent submits the primary judge did not err in fact or law. The primary judge weighed the relevant factors and reached a decision which was reasonably open in the exercise of the primary judge’s discretion. As no error had been shown in the exercise of that discretion, the appeal should be dismissed.Consideration Whilst section 41(8) of the Succession Act provides that any application for family provision must be commenced within nine months of a testator’s death, the court has an unfettered discretion to extend time, if to do so will enable the Court to do justice between the parties. Relevant factors in the exercise of that discretion include any explanation for the delay, any prejudice caused by the delay, any unconscionable conduct by the applicant, and the prospects of success of the substantive application.[1][1]Hills v Chalk [2009] 1 Qd R 409 at [75]. The primary judge had specific regard to each of those factors. The weight to be given to those factors was ultimately a matter for the primary judge, in the exercise of that discretion. Whilst the appellants contend that the primary judge made an error of law and/or fact in finding that the male appellant deliberately sent the proceeds of the sale of the deceased’s house to Italy in an effort to evade those funds forming part of the deceased’s estate, there was ample basis for that conclusion. The evidence, as accepted by the primary judge, was that the male appellant, knowing of the contents of the deceased’s last will, transferred the funds to Italy with the expectation that Italian law would require those funds to be distributed equally to the deceased’s children on his death. It was open to the primary judge on those findings to reject the male appellant’s stated reason for forwarding those funds to Italy, namely, to secure an aged care facility for the deceased. Whilst that finding obviously impacted upon the primary judge’s assessment of the male appellant’s credibility generally, there is no basis to conclude that the finding improperly affected the primary judge’s conclusion in relation to the inadequacy of the appellants’ explanation for the inordinate delay in bringing the application. The evidence placed before the primary judge overwhelmingly supported a conclusion that the appellants, knowing of the need to bring a separate application for family provision and knowing of the time limits in relation to the bringing of such an application, chose not to bring any such application for a period of almost 10 years. That evidence also supported the primary judge’s conclusion that the decision not to bring an application was not based on some genuine belief that the filing of the caveats constituted the commencement of such an application. The appellants had received information specifically to the effect that the caveats did not operate in that way. Further, the timing of the application for an extension of time, was entirely consistent with a conclusion, as found by the primary judge, that the application was only brought when the appellants became aware that Italian law may have the effect of rendering the Italian assets part of the deceased’s estate to be distributed in accordance with his last Will.