SUPREME COURT OF SOUTH AUSTRALIA
(Full Court: Application for Leave to Appeal to the Full Court)
KIRSTEN v MILLER
[2020] SASCFC 129
Judgment of The Full Court
(The Honourable Chief Justice Kourakis, The Honourable Justice Kelly and The Honourable Justice Blue)
24 December 2020
SUCCESSION - PROBATE AND LETTERS OF ADMINISTRATION - PROCEDURE
SUCCESSION - CONSTRUCTION AND EFFECT OF TESTAMENTARY DISPOSITIONS - PARTICULAR TESTAMENTARY DISPOSITIONS - CONDITIONS AND GIFTS OVER - DISPUTING WILL OR BRINGING ACTION AGAINST EXECUTOR OR TRUSTEE
APPEAL AND NEW TRIAL - APPEAL - PRACTICE AND PROCEDURE - SOUTH AUSTRALIA - WHEN APPEAL LIES - BY LEAVE OF COURT
The appellant seeks leave to appeal against advice and directions given, and restricted access orders in relation to filed affidavits made, by a Judge on the application of the respondent as executor of an estate.
The Judge heard the application for advice and directions ex parte after the appellant had said that he sought to be heard on the application. The appellant contends that the Judge erred by hearing and determining the application without giving him the opportunity to be heard in opposition to it. The appellant also contends that he should have been given access to the affidavits filed in support of the application.
Held by the Court:
1. The application for leave to appeal is to be heard at the same time as the appeal.
Administration and Probate Act 1919 (SA) s 69; Uniform Civil Rules 2020 (SA) rr 213.1(1)(a), 213.5(8)(b), referred to.
Fortress Credit Corporation (Australia) II Pty Ltd v Fletcher [2011] FCAFC 89; Salmi v Sinivouri [2008] QSC 321, considered.
KIRSTEN v MILLER
[2020] SASCFC 129Full Court: Kourakis CJ, Kelly and Blue JJ
THE COURT: This is an application by Ernst Kirsten (Ernst) for leave to appeal against advice and directions given, and restricted access orders in relation to filed affidavits made, by a Judge of this Court on the application of the respondent Cara Miller (Cara) as executor of the estate of the late Detlef Kirsten (Detlef).
Background
Detlef was the sole shareholder and director of Sound Diagnostics Pty Ltd. In 2016 he made a Will appointing his wife Cara as executor and trustee. By clause 8, he listed his assets, which included 100 per cent of the shares in Sound Diagnostics Pty Ltd trading as Sound Radiology. By clause 11, he left 40 per cent of his shares in Sound Diagnostics Pty Ltd to his father Ernst. Clause 11 provided:
I GIVE 40 percent (40%) of my shareholding in Sound Diagnostics Pty Ltd to Ernst Detlef Kirsten of [address]. This gift nullifies the oral agreement between myself and Ernst Detlef Kirsten that he shall receive 40% profit share from Sound Diagnostics Pty Ltd, as the 40% of shareholding is intended to replace this agreement. Should it be deemed that the oral 40% profit share agreement still applies, then this clause 11 of my Last Will and Testament shall no longer apply, and if…
Continue reading Kirsten v Miller
Sign in free to access the full text
- AGLC
- Kirsten v Miller [2020] SASCFC 129
- Case
- [2020] SASCFC 129
- Decision Date
CaseChat Overview and Summary
The central legal issue was whether the judge erred in hearing and determining the advice action on an ex parte basis, despite Ernst's stated intention to be heard. Ernst contended that he was denied any opportunity to participate, even if his right to be heard might have been qualified or limited. The court considered the established practice in England and Australia regarding the participation of beneficiaries in advice proceedings, noting that while beneficiaries are typically served, their presence during the discussion of the merits of the main action between the trustee's counsel and the judge is often restricted to avoid disclosure of sensitive information about the trustee's case.
The court acknowledged that the advice orders were interlocutory but noted they affected substantive rights by establishing the executor's right of indemnity for costs. The principal criteria for granting leave to appeal against an interlocutory decision were whether the decision was sufficiently doubtful to warrant reconsideration and whether substantial injustice would result if the decision were wrong. The court observed that Ernst had not been able to find Australian authority directly addressing a beneficiary's right to be heard on an executor's application for advice and directions.
Orders
Orders of the court
Full text does not contain this section.
Background
Background to the litigation
Full text does not contain this section.
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
Full text does not contain this section.
Ratio Decidendi
Legal Principle Established
Ernst concedes that the advice orders comprised an “interlocutory decision” within the meaning of rule 213.1(1)(a) of the Uniform Civil Rules 2020 (SA). We proceed on the basis of that concession even though orders made in the advice action affected substantive rights insofar as they established that Cara had a right of indemnity against the assets of the estate for costs incurred in prosecuting the proposed defence and counterclaim. It is well established that the principal criteria considered on an application for leave to appeal against an interlocutory decision are whether the decision is attended with sufficient doubt to warrant its reconsideration by the Full Court and whether substantial injustice would otherwise result if the decision is wrong. These would be factors to be taken into account in any event on an application for leave to appeal by a non-party.Consideration Ernst cites several authorities in support of the proposition that in England applications for advice and directions are served on the beneficiaries and the beneficiaries have a right to be heard.[4][4] Re Moritz [1960] Ch 251 at 255 per Wynn-Parry J; Re Eaton [1964] 3 All ER 229 at 230 per Wilberforce J; Smith v Croft [1986] 2 All ER 551 at 558 per Walton J; Alsop Wilkinson v Neary [1996] 1 WLR 1220 at 1226 per Lightman J; Craig v Humberclyde IndustrialFinance Group Ltd [1999] 1 WLR 129 at 136 per Morritt LJ. In Salmi v Sinivouri[5] Lyons J said:The practice in Australia follows the English procedure which is that whilst the beneficiaries are served with a claim, neither the beneficiary against whom the trustees propose to litigate, nor those representing him, would normally be allowed to be present when the merits of the main action are discussed between the trustee’s counsel and the judge because they might hear something that they should not, given that it is about the strength or weakness of the trustee’s case. Whilst the beneficiary and his counsel are allowed into the hearing to address any arguments they may wish, they must then withdraw while the matter is discussed between the trustee’s counsel and the judge. The beneficiary’s counsel are then readmitted to be informed of the court’s decision. The basic principles of natural justice mean that material placed before the judge should be kept to a minimum. In this regard, the respondents to the current application had the opportunity to put affidavit material before the court.[6][5] [2008] QSC 321.[6] At [15]. (Footnote omitted). Ernst contends that the Judge erred in hearing and determining the advice action on an ex parte basis when Ernst had stated that he sought to be heard on the application for advice. Ernst accepts that his right to be heard may have been qualified or limited in the manner identified by Lyons J but contends that he was denied a right to be heard at all. Ernst has not been able to locate any authority of this Court, or of another intermediate appellate court in Australia, on the question of a right of a beneficiary of an estate or trust to be heard on an application by the executor or trustee for advice and directions.