Lajcarova v Todorov
[2011] NSWSC 522
•17 June 2011
Supreme Court
New South Wales
Medium Neutral Citation: Lajcarova & Anor v Todorov [2011] NSWSC 522 Hearing dates: 31 May 2011; 1 June 2011 Decision date: 17 June 2011 Jurisdiction: Equity Division Before: Hallen AsJ Decision: 1. Having found that each Plaintiff is an eligible person and that the provision made for her in the Will of the deceased is inadequate, order that the first Plaintiff is to receive out of the estate of the deceased in New South Wales, a lump sum of $79,000 and the second Plaintiff is to receive a lump sum of $93,000.
2. Order that each of the lump sums should be paid within 28 days, or such other time as the parties agree, failing which, interest on any amount not so paid, should be paid at the rates prescribed for the purposes of s 84 of the Probate and Administration Act 1898, as the rate of interest on legacies, calculated from that date until the date of payment.
3. Order that each of the lump sums and any interest accrued thereon should constitute a charge on the Wollongong property until it is paid.
4. Exhibits are to be dealt with in accordance with the Uniform Civil Procedure Rules 2005.
5. Defer question of costs for further argument if the parties are unable to agree.
Catchwords: Family provision order sought by two daughters of deceased under the Family Provision Act 1982 - Whole estate left to son who looked after deceased - Whether jurisdictional issue established and if so, nature and quantum of provision to be made. Legislation Cited: Family Provision Act 1982
Probate and Administration Act 1898
Succession Act 2006
Succession Amendment (Family Provision) Act 2008
Uniform Civil Procedure Rules 2005Cases Cited: Alexander v Jansson [2010] NSWCA 176
Allardice, Allardice v Allardice, In re (1909) 29 NZLR 959
Anderson (deceased), Re (1975) 11 SASR 276
Blore v Lang [1960] HCA 73; (1960) 104 CLR 124
Bondelmonte v Blanckensee [1989] WAR 305
Bosch v Perpetual Trustee Co Ltd [1938] AC 463
Butcher v Craig [2009] WASC 164
Carey v Robson; Nicholls v Robson [2009] NSWSC 1142; [2010] NSWCA 212
Christie v Manera [2006] WASC 287
Collins v McGain [2003] NSWCA 190
Cooper v Dungan (1976) 50 ALJR 539
Crossman and Anor v Riedel and Ors [2004] ACTSC 127
Devereaux-Warnes v Hall (No 3) [2007]
Diver v Neal [2009] NSWCA 54
Durham v Durham [2011] NSWCA 62
Foley v Ellis [2008] NSWCA 288
Gardiner v Gardiner (NSWSC, 28 May 1998, unreported)
Goodman v Windeyer (1980) 144 CLR 490
Gorton v Parks (1989) 17 NSWLR 1
Harris, Re (1936) 5 SASR 497
Hawkins v Prestage (1989) 1 WAR 37
Hughes v National Trustees Executors & Agency Co of Australasia Ltd (1979) 143 CLR 134
Hyland v Burbidge [2000] NSWSC 12
Kay v Archbold [2008] NSWSC 254
Kembrey v Cuskelly [2008] NSWSC 262
Kleinig v Neal (No 2) [1981] 2 NSWLR 532
McCosker v McCosker [1957] HCA 52
McGrath v Eves [2005] NSWSC 1006
McKenzie v Topp [2004] VSC 90
MacGregor v MacGregor [2003] WASC 169 (28 August 2003)
Marks v Marks [2003] WASCA 297
Mayfield v Lloyd-Williams [2004] NSWSC 419
Pontifical Society for the Propagation of the Faith v Scales [1962] HCA 19
Puckridge (dec'd), In the Estate of (1978) 20 SASR 72
Singer v Berghouse (No 2) [1994] HCA 40
Stern v Sekers; Sekers v Sekers [2010] NSWSC 59
Taylor v Farrugia [2009] NSWSC 801
Vigolo v Bostin [2005] HCA 11
Vukic v Grbin & Ors; Estate of Grbin [2006] NSWSC 41
Walker v Walker (NSWSC, 17 May 1996, unreported)
Worladge v Doddridge (1957) 97 CLR 1Texts Cited: Government Gazette No. 38, 20 February 2009, page 1036 Category: Principal judgment Parties: Cvetanka Lajcarova (first Plaintiff)
Marika Velkovska (second Plaintiff)
George Todorov (Defendant)Representation: Counsel:
Mr S Galitsky (Plaintiffs)
Mr P Jeffriess (Defendant)
Solicitors:
D Stanefska & Associates (Plaintiffs)
Hansons Lawyers (Defendant)
File Number(s): 2010/60546
Judgment
The Claims and Formal Matters
HIS HONOUR: These reasons for Judgment concern proceedings commenced under the Family Provision Act 1982 ("the Act"), even though that Act has been repealed, effective from 1 March 2009. Under clause 11(2) of Schedule 1 of the Succession Act 2006 , the provisions of the Act "continue to apply in relation to the estate of a person who dies before the commencement of this clause, in so far as they are not affected by the operation of this Part". That clause commenced on 1 March 2009: s 2(1) Succession Amendment (Family Provision) Act 2008 and Government Gazette No. 38 of 20 February 2009, page 1036.
Vangelica Todorov (hereafter called "the deceased") died on 2 February 2009, aged 82 years. It is in respect of her estate that the proceedings are concerned. Cvetanka Lajcarova and Marika Velkovska (the Plaintiffs) is each a daughter of the deceased.
The proceedings were commenced by Summons filed on 9 March 2010, that is, within the time prescribed by the Act (18 months from the date of the deceased's death). Each Plaintiff seeks a family provision order and an order for costs. The former is an order made by the court under the Act in relation to the estate, or notional estate, of a deceased person, to provide from that estate for the maintenance, education, or advancement in life, of an eligible person.
The deceased left a Will, made and published by her, on 9 June 2004. Probate of that Will was granted, on 5 May 2010, to her son, George Todorov, the executor appointed under the Will and the Defendant in the proceedings.
I shall, without any disrespect or undue familiarity, refer to each of the Plaintiffs, to the Defendant, and where necessary, after introduction, to each of the other family of the deceased by her, or his, given name.
The deceased's Will provided for the whole of her estate, in Australia, to pass to George.
The deceased signed a statutory declaration on 22 August 2005, in which she stated:
"1. I did on 9 June 2004 execute my Will in which I made no provision for my two daughters who reside in Macedonia. I wish to document the reasons for not making any provision for my daughters and understand that this statement may be used by my personal legal representative in any proceeding brought by my daughters under the Family Provision Act whereby they seek a provision from my Will.
2. My husband and I began living in Australia in 1973. My son George Todorov came to live permanently in Australia in 1977. My daughters have never resided in Australia. My daughters were both married with families when my husband and I left Macedonia to live in Australia.
3. During my husbands [sic] lifetime he made substantial financial gifts to our daughters in Macedonia contributing to the purchase of motor vehicles, homes, wedding expenses and Christmas and Easter gifts. The majority of these gifts were made without my knowledge.
4. In October 2003 I suffered a stroke and since such time, and since the death of my husband in May 2004, my son has assumed the role of my principal carer. My son attends me on a daily basis and is responsible for all my day to day needs and also assists me with attendances on doctors and physiotherapy.
5. I wish to leave my estate to my son because of his substantial dedication to me and on the basis that my husband did not make financial contributions or gifts to him during his lifetime but did so to my daughters in Macedonia without my knowledge.
6. I request that any Court hearing an Application by my daughters to contest my Will under the Family Provision Act, will have serious regard to the matters I have stated in this statutory declaration and my heartfelt decision to exclude my daughters from any further benefit from me or my estate."
It is clear that a lawyer prepared the statutory declaration. (The deceased's signature appears to have been witnessed by a solicitor.) No evidence about the circumstances in which it was prepared, or executed, was given, although George denied any involvement in its preparation or execution.
In the Inventory of Property, a copy of which was placed inside, and attached to, the Probate document, the actual estate of the deceased, in New South Wales, was disclosed as having an estimated, or known, gross value of about $429,724. The estate was said to consist of real estate in Wollongong ($350,000), cash in bank ($79,723) and furniture and personal effects (no commercial value).
The parties agreed that, at the date of hearing, the deceased's estate in New South Wales has an estimated value of $682,529. The estate still consists of the real estate in Wollongong ($620,000) and cash in bank ($62,529). Liabilities of the estate, including funeral expenses, which are repayable to George, amount to $60,764. Accordingly, without taking into account the parties' costs of the proceedings, the net value of the estate appears to be $621,765.
George has given evidence that the deceased left property in Macedonia, which included a cemetery plot ($300), agricultural land ($2,000), a house in Bitola ($10,000), and bank accounts said to have funds of between $80,000 and $100,000 which were operated by Cevtanka, who had authority to withdraw funds.
There is no dispute that the deceased made a Will, which deals with her assets in Macedonia. That Will leaves to the Plaintiffs, equally, the moneys in the bank accounts, and devises the agricultural land to George absolutely. George intends to distribute the Macedonian property in accordance with that Will. That Will speaks of "... a savings account/savings accounts in my name or in the name of my late spouse ...".
In fact, on this topic, George's evidence may have been inaccurate, at least, in part. The accounts to which he was referring did not contain funds of between $80,000 and $100,000. An account that held about $70,000 appears to be the account, in New South Wales, which passed to the deceased under the Will of her husband. The funds in this account form part of the deceased's estate disclosed by him in his evidence.
This inaccuracy pales into insignificance when one considers the evidence of Cvetanka on this topic. During her cross-examination, she denied knowledge of any bank accounts, held in Macedonia, at the date of death, in the name of the deceased, in respect of which she had access. She said, as far as she knew, that there were no such accounts and denied having any passbooks or bank statements relating to any such account or accounts. She did, however, refer to the fact that the deceased had conducted a bank account in which there was $12,000 to $13,000, in different currencies. She did not identify any bank accounts, or state that there were any passbooks in her possession, which would reveal the precise amount in such an account or accounts.
Marika, on the second day of the hearing, gave evidence that she and Cvetanka knew of three bank accounts, in the name of the deceased, in which there was currently held between $12,000 and $13,000. She waved the three passbooks in the air whilst giving this evidence. She said that she had sent, by facsimile, copies of the statements "... which clearly shows only that the amount has been increased by adding the interest and [that] we have not withdrawn any money...". (No such statements were produced to the Court.)
She also said that Cvetanka had had access to these accounts, although no moneys were withdrawn from the accounts since the date of the deceased's death and that "[W]e won't open them, we won't touch them till our brother comes to Macedonia and we'll sit and open them up jointly".
On this aspect, I do not accept Cvetanka's evidence. In my view, she was far from frank about her knowledge of the bank accounts in the name of the deceased. Her denial of knowledge of the bank passbooks appears to have been untruthful.
Marika also said that she had disclosed the bank passbooks to George when he had visited Macedonia in 2008. I do not accept Marika's evidence that she told George of them in 2008, or at any time. There is no reason for him not to have disclosed the precise amount in the Macedonian bank accounts if he had known of them. In fact, it would have been of benefit to do so.
In the circumstances, each of the Plaintiffs is entitled to between $6,000 and $6,500 from the bank accounts held in the name of the deceased in Macedonia.
In calculating the value of the estate in Australia, at the date of hearing, the costs of the present proceedings should be taken into consideration, since the Plaintiffs, if successful, will, normally, be entitled to an order that her costs be paid, whilst the Defendant, irrespective of the outcome of the proceedings, will, normally, be entitled to an order that his costs be paid.
There was no evidence of the Plaintiffs' costs of the proceedings until an affidavit was filed on the second day of the hearing. The estimated costs and disbursements, including counsel's fees, of the Plaintiffs, calculated on the indemnity basis, were said to be $72,434. Those costs and disbursements, calculated on the ordinary basis, are estimated to be $57,434. In each case, the costs include GST.
The Plaintiffs' costs and disbursements appear high (especially when one considers that there were only two short affidavits sworn by each Plaintiff and two even shorter affidavits of the Plaintiffs' solicitor read in the proceedings). The disbursements included interpreter and translator costs ($3,014); video conferencing expenses (the Plaintiffs were cross-examined by video-link) (estimated to be $10,040); airfares and associated expenses for the Plaintiffs' solicitor to travel to Macedonia to obtain instructions for the principal affidavits ($7,700); and counsel's fees to the conclusion of a two day hearing ($14,300).
George's costs and disbursements, including counsel's fees, calculated on the indemnity basis, are estimated, for a two-day hearing, to be $65,000.
If the estimates of the value of the estate ($621,765), and if the costs and disbursements ($122,434), ultimately, prove accurate, and if a costs order is made under the Act in favour of the Plaintiffs for the full amount of their costs (calculated on the ordinary basis), the value of the net estate, in New South Wales, is likely to be no more than about $500,000. That is the value of the net distributable estate the parties accepted upon which I should determine the case.
The persons described as eligible persons, within the meaning of the Act, are the parties to the proceedings. Each has sworn at least one affidavit in the proceedings and each was cross-examined.
The grandchildren of the deceased were also identified as persons who are, or may be, eligible persons. However, there is no evidence that any of them were wholly, or partly, dependant, upon the deceased at any time. Certainly, none of them has filed an affidavit and there is no other evidence that confirms the eligibility of any of them. The Plaintiffs, whose children they are, did not submit that each was, in fact, an eligible person. In the circumstances, I am satisfied that the only eligible persons are the parties in the proceedings.
Background Facts
The following facts are either not the subject of any real dispute, or I find them to be established by the evidence:
Cvetanka
(a) She was born in December 1951 in Bitola, Macedonia.
(b) She left school at the end of 1970 and worked as a sales assistant for 35 years.
(c) In Bitola, she moved out of the family home in 1974 to marry Tomislav Lajcarov, to whom she remains married. They moved in to an old house with her husband's parents. When she married she received a small gift from her father and the deceased (a small bedroom suite).
(d) At this time, she had a good relationship with both her parents. Her father was in Australia and the deceased was living in Macedonia.
(e) In June 1975, her son, Pece, was born. In January 1978, her son, Jove, was born. Very soon after the birth of each child, she had to return to work.
(f) In about 1976, the deceased migrated to Australia to be with her husband.
(g) In 1984, Cvetanka's husband started building a home for the family on land owned by his family. They still live in that house with her married son, his wife and their children, and also her unmarried son.
(h) During the years of building the house, her husband worked two jobs, as well as building as an owner builder. She was employed as a sales assistant. Every weekend she assisted her husband to build the house. They experienced delays in building their house through a lack of finances.
(i) Between 1975 and her father's death in May 2004, her parents came to Macedonia from Australia for a holiday, usually every second year. They, with Cvetanka, would go to the mountains, for picnics, to lakes and to visit relatives together. They visited her and her family every day. When they returned to Australia, Cvetanka would telephone them approximately every 10 to 12 days. Otherwise, her parents would telephone or write.
(j) In 2000, both her father and the deceased came to Bitola for their grandson's marriage. They gave Cvetanka $2,500 to assist with the costs of the wedding party.
(k) Over the years, Cvetanka received regular financial assistance from her parents. Money would either be sent in cards by post, telegraphic transfer, or through relatives or friends who went to Macedonia. The total amount given to her is not clear. She would, in addition, receive between $100 and $200 each year at Christmas.
(l) Her parents purchased the real estate at Wollongong, which was included in the deceased's estate, for approximately $90,000.
(m) Cvetanka describes her relationship with the deceased as one of mutual love and respect.
At the present time, neither Cvetanka, nor her husband, works. She says that their economic situation is very difficult. She says that she relied upon her parents for financial support. That financial support included permission, given by her father, to share, with Marika, the monthly pension to which he was entitled in Macedonia. That assistance ceased when he died in 2004. She and her husband do not go on holiday, as they have no money. She asserts that she does not have sufficient income to cover their living expenses.
She continues to be treated for high blood pressure, diabetes, kidney disease and varicose veins. She does not have private health insurance. She says that to be medically treated, one is placed on a waiting list. If one has money, one can pay for treatment and, therefore, be treated faster.
Her and her husband's current financial position is as follows:
(a)
Money in savings accounts:
$ nil
(b)
Home at Bitola, Macedonia:
$50,000
(c)
Furniture (estimated):
$100
(d)
Husband's motor vehicle (22 year old Yugo):
$200
Liabilities
(a)
Mortgage on house:
$ nil
(b)
Loans:
$ nil
Income
(a)
Combined current monthly income:
$4,500 (about $375 per month)
Estimated Joint annual Expenditure
(a)
Motor vehicle expenses:
$400
(b)
Provisions for holidays:
$ nil
(c)
Purchase of clothing:
$ nil
(d)
Medical expenses:
3000
(e)
Food and toiletries:
$6,000
(f)
Household bills, electricity, wood:
$1,800
(g)
Gifts:
(h)
Entertainment
$ nil
(i)
Insurance:
$ nil
(j)
Mortgage payments:
$ nil
I have excluded from her disclosed expenses the costs of her son's wedding ($5,000), which was described as a "one-off" expense.
Occasionally, her husband, who is retired, would drive a taxi for some extra income. To make ends meet, her older son would also drive a taxi in the evenings. They do not do this any more.
Cvetanka admitted that her disclosed expenses ($11,200 per annum or $933 per month) were greater than her and her husband's monthly income. She said that her sons assist her financially by contributing to the household expenses.
She is concerned that she does not have sufficient funds for her retirement and she seeks a provision from the estate's assets for the purpose of providing more financial security for her future. She would apply any provision received from the deceased's estate for her future medical needs.
Photographs of the house in which she and her family live depict that it is quite large. It is divided into three separate floors in which three different families live. She has indicated that she would be surprised if they could find a buyer for the whole house for 55,000. She accepts that this is its current value.
She denies that she owns any business, children's shop or taxi s (as asserted by George). She says that her son owns and runs two shops and that her other son conducts a delicatessen from rented premises. However, neither pays rent, nor an occupation fee, for sharing the house in which they all live.
Marika
(a) She, too, was born in Bitola, in February 1950.
(b) Their father, Nikola Todorov, migrated to Australia in 1964. The deceased, Cvetanka and George grew up in Macedonia because her father sent money to them for food, clothing and for their education.
(c) In 1969, she moved from the family home into rental accommodation when she married Nikola Velkovski. When she married, she received a small gift from her parents.
(d) She and both of her parents had a good relationship.
(e) In 1971, her son, Saso, was born.
(f) She received from her parents, in 1973, approximately 500, which she used towards the purchase of a small house in which she currently lives.
(g) In 1990, she and her husband, with the financial assistance of her parents, renovated the house.
(h) In 1974, her daughter, Mirjana, was born.
(i) She obtained employment, in 1974, in a textile factory.
(j) She says her health deteriorated following the birth of her second child and, in the years 1978 to 1980, she went to Croatia for treatment. In the years 1984 to 1986 she went to Bulgaria for treatment. Her parents sent her the money to pay for the treatment.
(k) In 1986/1987, she and her husband visited her parents in Australia.
(l) In 1996, she had a heart attack. She was retired from the workforce on health grounds. Her parents continued to send her money.
(m) In 2000, both her children were married. She was able to pay for the wedding expenses with money sent to her by her parents.
(n) In 2005, she was admitted into hospital. The deceased sent her $1,000 to help with hospital expenses.
(o) A medical report states that she suffers from hypertension, bronchial asthma, ischaemic heart disease following a myocardial infarction, varicose veins (bilateral) following a thrombosis, and a prolapsed uterus. She requires regular medical supervision and occasional hospital check-ups.
She continues to be treated for her heart and the thrombosis. She does not have private health insurance. Like Cvetanka, she states that to be treated, one is placed on a waiting list. If one has money, she can be treated faster. Her husband's health is better than hers. She denies that the health system provides free medical treatment, although she admits that some of her prescriptions are on the "government's list", whilst others are not.
Neither she, nor her husband, works. Their economic situation is also described, by her, as difficult. The house in which they live is modest. They share it with their married son, his wife and their child. Neither she, nor her husband, goes on holiday, as they have no money. She does not have sufficient income to pay all of their living expenses.
She and her husband's financial position is as follows:
Assets
(a)
Money in savings accounts:
$ nil
(b)
Home at Bitola, Macedonia:
$20,000
(c)
Furniture (estimated):
$100
(d)
Husband's motor vehicle 1979 model:
$200
(e)
Land and structure on which grapes are grown:
$5,000
Liabilities
(a)
Mortgage on house:
$ nil
(b)
Loans:
$ nil
Income
(a)
Combined current annual income:
$5,400 (or $450 per month)
Estimated Joint annual Expenditure
(a)
Motor vehicle expenses:
$400
(b)
Provisions for holidays:
$ nil
(c)
Purchase of clothing:
$ nil
(d)
Medical expenses:
$3,000
(e)
Food and toiletries:
$3,600
(f)
Household bills, electricity, wood:
$1,800
(g)
Gifts:
$ nil
(h)
Insurance:
$ nil
(i)
Mortgage payments:
$ nil
To supplement their income, each spring, her husband collects and sells snails. He earns about $100 doing this work.
Marika admitted that her disclosed expenses ($8,800) per annum or $733 per month) were greater than her and her husband's monthly income. She said that her son assists her financially by contributing to the household expenses. (Her daughter, who is a nurse, is unable to assist her financially because she is presently unemployed.)
She is concerned that she does not have sufficient funds for her retirement and she seeks a provision from the estate for the purpose of providing more financial security for her future. She states that she would apply any provision from the deceased's estate for her future medical needs.
In Foley v Ellis [2008] NSWCA 288, Sackville AJA at [88] noted that Singer v Berghouse (No 2) [1994] HCA 40; (1994) 181 CLR 201 "... strongly suggests that the court cannot consider the propriety and adequacy (or inadequacy) of any testamentary provision for an applicant in isolation from the resources and needs of other claimants on the deceased's bounty. These claimants include other beneficiaries entitled to a share of the deceased's estate, whether or not they themselves have made a claim under the Family Provision Act ".
It is, therefore, necessary to consider the circumstances of George, including his financial and material circumstances. I am satisfied that the following facts are not in dispute or have been established by the evidence.
George
(a) He was born in May 1954.
(b) He obtained a Trade Certificate as a Motor Mechanic in 1973.
(c) In 1977, he migrated to Australia. For about 6 months, he lived with his father and the deceased.
(d) He commenced employment as a labourer with BHP Steel Works in Port Kembla in October 1977. He has remained with that company (now called BlueScope Steel) ever since. He is currently employed as a Gas Operator.
(e) He owns his home at Wollongong. He is married with no children.
(f) He received no gifts, or other benefits, from the deceased.
(g) On various occasions, he sent each of the Plaintiffs money. In all, he estimates he sent them $29,300. He says that these were loans. No amount has been repaid.
He summarises his assets and liabilities as follows:
Assets
(a)
Kenny Street, Wollongong (est):
$465,000
(b)
Corrimal Street, Wollongong
(Defendant's half share):
$205,000
(c)
Bligh Street, Wollongong
(Defendant's half share):
$232,500
(d)
Auburn Street, Wollongong
(Defendant's half share):
$195,000
(e)
Toyota Hi-Lux:
$5,000
(f)
Ford Telstar:
$2,000
(g)
Trail bike:
$500
(h)
Colonial First State Cash Management:
$4,044.65
(i)
Commonwealth Bank Streamline Account:
$14,788.69
(k)
IMB Everyday Account:
$73,193.31
(l)
IMB Everyday Account:
$2,028.64
(m)
Shares in BlueScope Steel (794 shares) (Defendant's half share):
$830
(n)
Shares in BHP (Defendant's half share):
$23,103.50
(o)
AMP Personal Super Plan (Defendant's half Share):
$23,686.44
(p)
Superannuation
(Defendant's half share):
$285,823.34
Total Assets:
$1,532,498.57
Liabilities
(a)
Mortgage to IMB:
$165,096.00
Income
(a)
Wages (nett (per annum)):
$50,145.00
(b)
Rent for Auburn Street and Blight Street:
$44,117.76
Total income:
$94,262.76
Expenditure (per annum)
(a)
Land Rates:
$7,129.94
(b)
Water:
$5,296.80
(c)
Insurance:
$4,000.00
(d)
Land Tax:
$9,200.00
(e)
Registration for cars and motor bikes:
$855.00
(f)
Car expenses:
$7,500.00
(g)
Car insurance:
$500.00
(h)
Mobile phone:
$300.00
(i)
Land line:
$740.00
(j)
Electricity:
$1,400.00
(k)
Gas:
$880.00
(l)
Cigarettes:
$10,950.00
(m)
Food:
$15,600.00
(n)
Allowance to wife:
$10,000.00
(o)
Clothes:
$7,800.00
(p)
Entertainment:
$7,800.00
(q)
Personal, Medical, Medication:
$7,800.00
(r)
Property maintenance:
$7,500.00
(s)
NIB Health Insurance:
$2,940.00
Total Expenditure:
$108,191.74
His wife has no assets of value, as she has not been gainfully employed. He owns the house in which they live and the bank accounts, furniture and motor vehicle.
George has referred to having a half share in a number of properties. Between about 1989 and 2000, he lived in a domestic relationship with Jillian Van Der Kooi. Although this relationship ceased, their friendship has continued. During their relationship they accumulated properties, which are in his name only. He admits that she has a legitimate claim on these properties due to their relationship and the fact that she contributed to them.
He also asserts that she has an interest in his superannuation. I am satisfied that she may do, at least so far as it relates to the contributions made by him during the period of their relationship. However, he does not assert that she made any actual contributions to his superannuation.
Ms Van Der Kooi, who swore an affidavit and who was not cross-examined states that she and the deceased bought the properties, which were registered in George's name, but which "we both acknowledge that I have a one half share interest". She also says that she plans to retire in two years or so and has informed George that the properties then will need to be divided equally.
There is no doubt that, with overtime, George's income is reasonably large. In the year ending 30 June 2010, he was able to salary sacrifice about $45,000 to superannuation.
George asserts that he contributed to the acquisition and improvement of the deceased's real estate at Wollongong as follows:
(i) By contribution of $5,000 on purchase in 1983.
(ii) By performing renovation work in 1990. In addition, he:
(a) Carried out a general clean up of rubbish and dumping (36 trailer loads);
(b) Painted the house inside and outside;
(c) Purchased and installed new curtains, security doors, front and back, fly screens, two wall cupboards in kitchen, a hot water system;
(d) Unblocked the kitchen sewer.
Between 2005 and 2008, George was the sole carer of the deceased. As the deceased's health declined and she was in need of more support, it was left to him to provide that support. This included:
(i) Seeing to her everyday needs;
(ii) Providing her with support workers (personal and medical care);
(iii) Organising her daily meals;
(iv) Organising cleaning of her home;
(v) Buying all her supplies;
(vi) Arranging and taking her to medical appointments;
(vii) Organising and taking her on outings;
(viii) At times, he was required to change her incontinence pads.
Although there was no cross-examination of George on the care he provided to the deceased, I note that his evidence, in any event, is corroborated by a letter from a general medical practitioner, Dr Ian McCorkindale, who certifies that he "was involved heavily in the care of his mother ... at home through her long demise post-cerebrovascular accident in 2003 until her death in 2009".
To enable her to continue to live in the house, George says that he performed the following work between 2005 and 2009:
(i) Re-wired the entire house;
(ii) Re-plastered the entire house;
(iii) Re-roofed the house;
(iv) Demolished and rebuilt the exterior walls;
(v) Painted the entire house, both interior and exterior;
(vi) Constructed a ramp;
(vii) Re-tiled and rebuilt the bathroom and toilet to accommodate the deceased's disability;
(viii) Re-tiled and rebuilt the kitchen;
(ix) Put in a path.
In March 2008, the deceased had her third stroke. She went to hospital and never returned to live at her own home. She was in a coma and in intensive care for eight weeks. She was not expected to come out of the coma. She did, and he went everyday, and sometimes twice a day, for the next nine months.
There is no dispute that he had an excellent relationship with the deceased.
In relation to the statutory declaration of the deceased, leaving aside any parts that may be the subject of dispute, it records the support, care and assistance provided to her by George. There is, and can be, no argument that is an accurate reflection of the deceased's regard for him.
George suffers from the following heath problems:
(i) Stress, anxiety and depression;
(ii) Back and joint pain;
(iii) Chest pain.
On his family doctor's advice, he is now under the care of a psychologist. The prognosis appears to be reasonably good.
I have also read two reports of Dr Irwin Pakula, a consultant psychiatrist who saw George in December 2010 and then in March 2011. He describes, George, in my view, correctly, having seen him in the witness box, as "a very expressive and very emotional man", who "has unresolved bereavement issues related to the death of his mother and great distress about his sisters contesting his mother's will" and who "suffers from a Major Depressive Disorder".
George says that whilst he is a good employee, he cannot say for how long he will be employed. However, there is no evidence that his employment is threatened.
Whilst there was no dispute that the Plaintiffs each received money from their father, there was an issue about whether the deceased was aware that he was giving them money. This issue, at least in part, resulted from a statement in the statutory declaration by the deceased, that the gifts of money were made without her knowledge.
Ms Van Der Kooi also refers to statements of the deceased that confirmed the contents of the Will that she had made. She also gives evidence about statements by the deceased to the effect that the Plaintiffs "have had enough".
To the extent that the issue is relevant, I think it likely that the deceased knew that moneys were being sent to each of the Plaintiffs, although she may not have known how regularly or in what amount. Whether she knew or not, I am satisfied that this was provision made, at least indirectly, by the deceased, during her lifetime, even though it was from her husband's wages that the moneys came.
The Statutory Scheme
In an application under the Act, the Court must determine whether the applicant is an eligible person; if so, whether she, or he, has been left with adequate provision for her, or his, proper maintenance, education and advancement in life; and, finally, if not left with that provision, what, if any, provision (or further provision) ought to be made out of the estate for those purposes.
The power of the Court to make an order under the Act is enlivened by the formation of an opinion that the disposition of the deceased's estate effected by her Will, or as a result of intestacy, is not such as to make adequate provision from her estate for the proper maintenance, education or advancement in life of the applicant.
No criteria are prescribed in the statute as to the circumstances that do, or do not, constitute "inadequate provision for the proper maintenance, education and advancement in life".
The question is answered by an evaluation that necessarily takes the court to the provision actually made in the deceased's Will, or as a result of intestacy, on the one hand, and to the needs for maintenance and advancement in life of the applicant on the other. It has conventionally been said that this involves a consideration of the relationship between the deceased, the applicant and other relevant persons having similar claims for adequate provision to be made for them: see Goodman v Windeyer (1980) 144 CLR 490 at 496).
"Provision" is not defined by the Act, but it was noted in Diver v Neal [2009] NSWCA 54 at [34], that the term "covers the many forms of support and assistance which one individual can give to another. That support and assistance will vary over the course of the person's lifetime".
Neither are the words 'maintenance' and 'advancement in life' defined. However, in Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191, Callinan and Heydon JJ, at [115], said, of the words 'maintenance', 'support' and 'advancement':
"'Maintenance' may imply a continuity of a pre-existing state of affairs, or provision over and above a mere sufficiency of means upon which to live. 'Support' similarly may imply provision beyond bare need. The use of the two terms serves to amplify the powers conferred upon the court. And, furthermore, provision to secure or promote 'advancement' would ordinarily be provision beyond the necessities of life. It is not difficult to conceive of a case in which it appears that sufficient provision for support and maintenance has been made, but that in the circumstances, say, of a promise or an expectation reasonably held, further provision would be proper to enable a potential beneficiary to improve his or her prospects in life, or to undertake further education."
In In the Estate of Puckridge, Deceased (1978) 20 SASR 72, at 77 King CJ said:
"The words 'advancement in life' have a wide meaning and application and there is nothing to confine the operation of the provision to an earlier period of life in the members of the family: Blore v Lang (1960) 104 CLR 124, per Dixon CJ at 128."
In Mayfield v Lloyd-Williams [2004] NSWSC 419, White J noted:
"In the context of the Act the expression "advancement in life" is not confined to an advancement of an applicant in his or her younger years. It is phrase of wide import. ( McCosker v McCosker (1957) 97 CLR 566 at 575) The phrase "advancement in life" has expanded the concept used in the Victorian legislation which was considered in Re Buckland permitting provision to be made for the "maintenance and support" of an eligible applicant. However Adam J emphasised that in a large estate a more extravagant allowance for contingencies could be made than would be permissible in a small estate and still fall within the conception of maintenance and support."
The word 'adequate' connotes something different from the word 'proper'. 'Adequate' is concerned with the quantum, whereas 'proper' prescribes the standard, of the maintenance education and advancement in life: Devereaux-Warnes v Hall [No 3] [2007] WASCA 235; (2007) 35 WAR 127 at [72] and at [77] per Buss JA.
Each of the words were considered by Lord Romer in delivering the advice of the Privy Council in Bosch v Perpetual Trustee Co Ltd [1938] AC 463, at 476:
"The use of the word 'proper' in this connection is of considerable importance. It connotes something different from the word 'adequate'. A small sum may be sufficient for the 'adequate' maintenance of a child, for instance, but, having regard to the child's station in life and the fortune of his father, it may be wholly insufficient for his 'proper' maintenance. So, too, a sum may be quite insufficient for the 'adequate' maintenance of a child and yet may be sufficient for his maintenance on a scale that is 'proper' in all the circumstances."
Dixon CJ and Williams J, in McCosker v McCosker (1957) 97 CLR 566 at 571, after citing Bosch v Perpetual Trustee Co Ltd , went on to say, of the word 'proper', that:
"It means "proper" in all the circumstances of the case, so that the question whether a widow or child of a testator has been left without adequate provision for his or her proper maintenance, education or advancement if life must be considered in the light of the competing claims upon the bounty of the testator and their relative urgency, the standard of living his family enjoyed in his lifetime, in the case of a child his or her need of education or of assistance in some chosen occupation and the testator's ability to meet such claims having regard to the size of his fortune. If the court considers that there has been a breach by a testator of his duty as a wise and just husband or father to make adequate provision for the proper maintenance education or advancement in life of the applicant, having regard to all these circumstances, the court has jurisdiction to remedy the breach and for that purpose to modify the testator's testamentary dispositions to the necessary extent."
In Goodman v Windeyer (1980) 144 CLR 490, Gibbs J said at 502:
"[T]he words 'adequate' and 'proper' are always relative. There are no fixed standards, and the court is left to form opinions upon the basis of its own general knowledge and experience of current social conditions and standards."
Santow J pointed out in Gardiner v Gardiner ( NSWSC, 28 May 1998, unreported), "adequate" and "proper" are independent concepts:
"Adequate" relates to the needs of the applicant. It is determined by reference to events occurring up to the death of the deceased, but also encompassing what the deceased might reasonably have foreseen before death. "Proper" depends upon all the circumstances of the case. These include the applicant's station in life, the wealth of the deceased, the means and proper claims of all applicants, the relative urgency of the various claims on the deceased's bounty, the applicant's conduct in relation to the deceased, the applicant's contribution to building up the deceased's estate, the existence of dependents upon the applicant, the effects of inflation, the applicant's age and sex, and whether the applicant is able-bodied..."
In Vigolo v Bostin at [114], Callinan and Heydon JJ said:
"[T]he use of the word "proper"...implies something beyond mere dollars and cents. Its use, it seems to us, invites consideration of all the relevant surrounding circumstances and would entitle a court to have regard to a promise of a kind which was made here...The use of the word "proper" means that attention may be given, in deciding whether adequate provision has been made, to such matters as what use to be called the "station in life" of the parties and the expectations to which that has given rise, in other words, reciprocal claims and duties based upon how the parties lived and might reasonably expect to have lived in the future."
Thus, "proper maintenance" is not limited to the bare sustenance of an applicant, but requires consideration of the totality of her, or his, position in life including age, status, relationship with the deceased, financial circumstances, the environs to which she, or he, is accustomed, and mobility: Alexander v Jansson [2010] NSWCA 176 at [18].
Unless the court comes to the conclusion that inadequate provision has been made, it is not empowered to make an award. This is commonly referred to as "the jurisdictional question". At this stage, the court will consider whether it can make an order for provision for the maintenance, education and advancement in life of a particular applicant.
Whether the applicant has a 'need' is a relevant factor at the first stage of the enquiry. It is an element in determining whether 'adequate' provision has been made for the 'proper' maintenance education and advancement in life of the applicant in all of the circumstances: Collins v McGain [2003] NSWCA 190 [42] (Tobias JA, with whom Beazley and Hodgson JJA agreed).
Tobias JA said:
"42. There can be no question that, at least as part of the first stage of the process, the question of whether the eligible person has a relevant need of maintenance etc is a proper enquiry. This is so as the proper level of maintenance etc appropriate for an eligible person in all the circumstances clearly calls for a consideration of his or her needs. However, the question of needs must not be too narrowly focused. It must, in my view, take into account, depending upon the particular circumstances of the case, present and future needs including the need to guard against unforeseen contingencies.
...
47. As I have observed, the issue of need is not confined to whether or not an eligible person has, at the date of hearing, a then need for financial assistance with respect to his maintenance etc. It is a broader concept. This is so because the question of needs must be addressed in the context of the statutory requirement of what is "proper maintenance etc" of the eligible person. It is the cause of that context that, in the present case, the "proper maintenance etc" of the appellant required consideration to guard against the contingency to which I have referred."
In Devereaux-Warnes v Hall [No 3] at [81]-[85], Buss JA said, in respect of the first stage of the process:
"The term 'need' has been used to refer to the claimant's inability to satisfy his or her financial requirements from his or her own resources. See Singer per Gaudron J at 227.
'Need' has also been used in the context of a value judgment or conclusion, namely, that the claimant is 'in need' of maintenance, etc, because inadequate provision has been made for his or her proper maintenance, etc. See Gorton v Parks (1989) 17 NSWLR 1 per Bryson J at 10-11.
The determination of whether the disposition of the deceased's estate was not such as to make adequate provision for the proper maintenance, etc, of the claimant will always, as a practical matter, involve an evaluation of the provision, if any, made for the claimant on the one hand, and the claimant's 'needs' that cannot be met from his or her own resources on the other. See Hunter per Kirby P at 575.
Although the existence or absence of 'needs' which the claimant cannot meet from his or her own resources will always be highly relevant and, often, decisive, the statutory formulation, and therefore the issue in every case, is whether the disposition of the deceased's estate was not such as to make adequate provision for his or her proper maintenance, etc. See Singer per Gaudron J at 227. Compare Gorton per Bryson J at 6-11; Collicoat v McMillan [1999] 3 VR 803 per Ormiston J at 816 [38], 820 [47]."
If the court answers the jurisdictional question favourably to the applicant, the nature and quantum of the order that the court is then empowered to make is stipulated by s 7 as being an order that:
"... in the opinion of the Court, ought, having regard to the circumstances at the time the order is made, to be made for the maintenance, education or advancement in life of the eligible person."
At the second stage, the court determines whether it should make an order, and if so, the nature of any such order, having regard to the facts known to the court at the time the order is made. The fact that the court has a discretion means that it may refuse to make an order even though the jurisdictional question has been answered in the applicant's favour.
Section 9(3) of the Act should not be forgotten because the matters referred to therein are relevant, not only in determining whether an order ought to be made, but also in determining the nature of the order which should be made. Section 9(3) provides:
"In determining what provision (if any) ought to be made in favour of an eligible person out of the estate or notional estate of a deceased person, the Court may take into consideration:
(a) Any contribution made by the eligible person whether of a financial nature or not and whether by way of providing services of any kind or in any other manner, being a contribution directly or indirectly to:
(i) the acquisition, conservation or improvement of property of the deceased person; or
(ii) the welfare of the deceased person, including a contribution as a homemaker;
(b) The character and conduct of the eligible person before and after the death of the deceased person;
(c) Circumstances existing before and after the death of the deceased person; and
(d) Any other matter which it considers necessary in the circumstances."
In Singer v Berghouse (No2) , the High Court described the two-stage approach that a court should take. At 209, it was said:
"The first question is, was the provision (if any) made for the applicant 'inadequate for (his or her) proper maintenance, education and advancement in life'? The difference between 'adequate' and 'proper' and the interrelationship which exists between 'adequate provision' and 'proper maintenance' etc were explained in Bosch v Perpetual Trustee Co Ltd . The determination of the first stage in the two-stage process calls for an assessment of whether the provision (if any) made was inadequate or what, in all the circumstances, was the proper level of maintenance etc appropriate for the applicant having regard, amongst other things, to the applicant's financial position, the size and nature of the deceased's estate, the totality of the relationship between the applicant and the deceased, and the relationship between the deceased and other persons who have legitimate claims upon his or her bounty.
The determination of the second stage, should it arise, involves similar considerations. Indeed, in the first stage of the process, the court may need to arrive at an assessment of what is the proper level of maintenance and what is adequate provision, in which event, if it becomes necessary to embark upon the second stage of the process, that assessment will largely determine the order which should be made in favour of the applicant. In saying that, we are mindful that there may be some circumstances in which a court could refuse to make an order notwithstanding that the applicant is found to have been left without adequate provision for proper maintenance. Take, for example, a case like Ellis v Leeder where there were no assets from which an order could reasonably be made and making an order could disturb the testator's arrangements to pay creditors."
In Vigolo v Bostin , Gleeson CJ and Gummow and Hayne JJ at [5], [74] and [82] - [83] approved the two-stage test set out in Singer v Berghouse .
It has recently been repeated by Campbell JA in Durham v Durham [2011] NSWCA 62:
"81 Under both the Family Provision Act and the Succession Act whether the jurisdictional question is satisfied is a matter of whether an evaluative standard has been met, rather than truly a matter of discretion. ...
82 A judge's decision as to the amount and type of an award to be made is a true discretionary decision, whether that decision is made under the Family Provision Act or under the Succession Act ."
The provision to be made may be made in a variety of ways, including a lump sum, periodic sum or "in any other manner which the Court thinks fit": s 11 of the Act. The court, if it makes an order for provision, "may specify the beneficial entitlements in that estate which shall bear the burden of the provision and, in relation to each entitlement, the part of the burden it is to bear": s 13 of the Act. The court is empowered, at its discretion, to order that such provision as the court thinks fit is made out of the estate of the deceased for that purpose. An order takes effect as a codicil to the will, or where the deceased died intestate, in a will of the deceased person: s 14 of the Act.
General Principles
In Cooper v Dungan (1976) 50 ALJR 539, Stephen J, at 542, reminded the court to be vigilant in guarding "against a natural tendency to reform the deceased's will according to what it regards as a proper total distribution of the estate rather than to restrict itself to its proper function of ensuring that adequate provision has been made for the proper maintenance and support of an applicant".
The court's discretion is not untrammelled, or to be exercised according to idiosyncratic notions of what is thought to be fair, or in such a way as to transgress, unnecessarily, upon the deceased's freedom of testation ( Pontifical Society for the Propagation of the Faith v Scales [1962] HCA 19; (1961) 107 CLR 9, per Dixon CJ at 19); McKenzie v Topp [2004] VSC 90 at [63]. Freedom of testamentary disposition remains a prominent feature of the Australian legal system.
Yet, in considering the question, the nature and content of what is adequate provision for the proper maintenance, education and advancement in life, is not fixed or static. Rather, it is a flexible concept, the measure of which should be adapted to conform with what is considered to be right and proper according to contemporary accepted community standards: The Pontifical Society for the Propagation of the Faith v Scales at 19; Walker v Walker (NSWSC, 17 May 1996, unreported); Vigolo v Bostin at [11]; Stern v Sekers; Sekers v Sekers [2010] NSWSC 59.
As Bryson J noted in Gorton v Parks (1989) 17 NSWLR 1 at 6, it is not appropriate to endeavour to achieve a "fair" disposition of the deceased's estate. It is not part of the court's role to achieve some kind of equity between the various claimants. The court's role goes no further than the making of "adequate" provision in all the circumstances for the "proper" maintenance etc of an eligible applicant.
The Act is not a "destitute persons Act", and it is not necessary, therefore, that an applicant should be destitute to succeed in obtaining an order: In re Allardice, Allardice v Allardice (1909) 29 NZLR 959 at 966.
In considering the question of provision, the nature and content of what is adequate for the proper maintenance, education and advancement in life, is not fixed or static. Rather, it is a flexible concept, the measure of which should be adapted to conform with what is considered to be right and proper according to contemporary accepted community standards: The Pontifical Society for the Propagation of the Faith v Scales , at 19; Walker v Walker ; Vigolo v Bostin at [11]; Stern v Sekers; Sekers v Sekers .
Promises made and expectations raised by a deceased have always been regarded as relevant to the ascertainment of what is proper provision for a claimant ( Re Anderson (deceased) (1975) 11 SASR 276, 284; Hughes v National Trustees Executors & Agency Co of Australasia Ltd (1979) 143 CLR 134, 148). This is particularly so where an applicant has relied to his, or her, detriment on any such promise or expectation: Vukic v Grbin & Ors; Estate of Zvonko Grbin [2006] NSWSC 41).
All of the financial needs of the applicant have to be taken into account and considered by reference to the other factors referred to in section 9(3) of the Act and in Singer v Berghouse . What is proper provision is not arrived at by adding up all of the identified financial needs: Hyland v Burbidge [2000] NSWSC 12 at [56]. Nor does it follow that if the Court decides it is inappropriate to make a specific provision in respect of one identified head of claim that any identified financial need, even a contingent need, in relation to that claim becomes irrelevant to the final assessment: Mayfield v Lloyd-Williams .
The lack of reserves to meet demands, particularly of ill health, which become more likely with the advancing years is a relevant consideration: MacGregor v MacGregor [2003] WASC 169 (28 August 2003) at [178] and [179]; Crossman and Anor v Riedel and Ors [2004] ACTSC 127 at [49]. Likewise, financial security and a fund to protect against the ordinary vicissitudes of life, is relevant: Marks v Marks [2003] WASCA 297 at [43].
The resources and needs of other claimants on the deceased's bounty are to be taken into account in determining a claim under the Act: Vigolo v Bostin at [122]; Foley v Ellis at [88] and [89]; Carey v Robson [2010] NSWCA 212 at [15].
Where the Court is satisfied that provision ought to be made, then it is no answer to a claim for provision under the Act that to make an order would be to defeat the intentions of the deceased. The Act requires, in such circumstances, for the deceased's intention to be displaced: Kembrey v Cuskelly [2008] NSWSC 262 at [45].
In relation to a claim under the Act by an adult child of the deceased, the following matters should also be noted:
(a) The relationship between parent and child changes when the child leaves home. However, a child does not cease to be a natural recipient of parental ties, affection or support, as the bonds of childhood are relaxed.
(b) It is impossible to describe in terms of universal application, the moral obligation, or community expectation, of a parent in respect of an adult child. It can be said that, ordinarily, the community expects parents to raise, and educate, their children to the very best of their ability while they remain children; probably to assist them with a tertiary education, where that is feasible; where funds allow, to provide them with a start in life - such as a deposit on a home, although it might well take a different form. The community does not expect a parent, in ordinary circumstances, to provide an unencumbered house, or to set their children up in a position where he, or she, can acquire a house unencumbered, although in a particular case, where assets permit and the relationship between the parties is such as to justify it, there might be such an obligation ( McGrath v Eves [2005] NSWSC 1006; Taylor v Farrugia [2009] NSWSC 801).
(c) Generally, also, the community does not expect a parent to look after his, or her, child for the rest of the child's life and into retirement, especially when there is someone else, such a spouse, who has a prime obligation to do so. Plainly, if an adult child remains a dependent of a parent, the community usually expects the parent to make provision to fulfil that ongoing dependency after death. But where a child, even an adult child, falls on hard times and where there are assets available, then the community may expect a parent to provide a buffer against contingencies; and where a child has been unable to accumulate superannuation or make other provision for their retirement, something to assist in retirement where otherwise they would be left destitute: Taylor v Farrugia .
(d) There is no obligation upon the deceased to have treated all of his, or her, children equally. In Carey v Robson; Nicholls v Robson [2009] NSWSC 1142, Palmer J commented:
"57 The strongest ground for relief urged by Rosemary and Marion, though put somewhat obliquely, is that the provision made for them by the testator is vastly disproportionate to the provision made for Alan. One can understand the sense of grievance which one child may have at being treated by a parent differently from another child. Some may be tempted to think that great disproportionality of testamentary treatment in itself indicates some essential error in the testamentary process which requires amelioration under the Family Provision Act so as to achieve approximate equality between a testator's children.
58 That is not, of course, a position from which one can begin in this, or in any other case under the family provision legislation."
(e) There is no the need for an adult child to show some special need or some special claim: McCosker v McCosker ; Kleinig v Neal (No 2) [1981] 2 NSWLR 532; Bondelmonte v Blanckensee [1989] WAR 305; and Hawkins v Prestage (1989) 1 WAR 37 per Nicholson J at 45.
Menzies and Fullager JJ in Blore v Lang [1960] HCA 73; (1960) 104 CLR 124 at 134-5, commented in respect of "a married woman with a healthy husband in satisfactory employment who supports her in reasonable comfort" that, "[H]er need is not for the bread and butter of life, but for a little of the cheese or jam that a wise and just parent would appreciate should be provided if circumstances permit".
Even more vividly, but to similar effect, is the approach in Worladge v Doddridge (1957) 97 CLR 1 at 12, in which Williams and Fullagar JJ approved the following statement, in Re Harris (1936) 5 SASR 497 at 501:
"Proper maintenance is (if circumstances permit) something more than a provision to keep the wolf from the door - it should at least be sufficient to keep the wolf from pattering around the house or lurking in some outhouse in the backyard - it should be sufficient to free the mind from any reasonable fear of any insufficiency as age increases and health and strength gradually fail."
Of course, in the present case, the husband of each Plaintiff is not working.
Determination
Claims for a family provision order present particular difficulties where the estate is relatively small. Any provision made by the Court in favour of the applicant must, in this class of case, be made at the expense of the beneficiary who has had to defend the claims.
In this case, there is no dispute that each Plaintiff, as a daughter of the deceased, is an eligible person within the meaning of s 6(1)(b) of the Act. There is also no dispute that the proceedings were commenced within the time prescribed by the Act.
Thus, I must first consider, whether, at the present time, adequate provision for the proper maintenance, education, or advancement in life, of each has not been made, during the lifetime of the deceased or by her Will.
Certainly, there was no provision in the deceased's Will made in Australia and dealing with Australian property, for either of the Plaintiffs. However, this does not, automatically, mean that she will have established the jurisdictional threshold. There was no dispute that provision had been made for each of the Plaintiffs during the deceased's lifetime, if not directly, by her, then indirectly, since moneys sent by her husband to the Plaintiffs may very well have formed part of the moneys that had been saved by them and which passed to her following his death. Section 9(2)(a) of the Act requires me to consider such provision.
In view of the evidence given by Marika about the money held in the bank accounts in Macedonia, to the proceeds of which the Plaintiffs are entitled to share under the deceased's Will made in Macedonia dealing with Macedonian assets, it can be said that each will receive between $6,000 and $6,500.
I am not satisfied that the Defendant has established that the financial position of each Plaintiff is better than she has stated it to be. In particular, based upon the evidence he has advanced, I am not satisfied that Cvetanka owns, or has an interest in, a delicatessen, a taxi business, and two shops selling children's clothes. To find the contrary, I would need to be satisfied that, Cvetanka intentionally misled the Court as to her financial and material circumstances. I am not comfortably satisfied, on this issue, that she has done so.
It is true that Marika did not disclose ownership of a parcel of land on which she grows grapes in her evidence in chief. However, she did disclose it as an asset in her second affidavit. This omission does not lead me to conclude that her financial and material circumstances are better than she has asserted.
I also accept that each Plaintiff's household expenses are shared between the adult members of the household and that such financial assistance had not been disclosed in the affidavits. Again, I am not satisfied that this was done with the intention of misleading George or the Court. Rather, I think it had to do with the manner in which their case was prepared and the lack of detailed instructions that should have been obtained from them by their legal representatives.
I am comforted in my conclusion about each of the Plaintiffs by the Defendant's statement to the effect that compared with Australian standards, she is not well off. As was put in the written submissions of the Defendant:
"That the Plaintiffs are, in Australian terms, poor, is clear. However, the cost of living in Macedonia is significantly lower than in Australia."
Taking into account all of the matters that I am required to consider in the first stage, including the financial position of each, the size and nature of the estate, the relationship between each and the deceased, and the relationship between the deceased and the only other person who has a legitimate (and in this sense competing) claim upon her bounty (George), I am satisfied that each of the Plaintiffs has satisfied the jurisdictional threshold.
In the case of each Plaintiff, I am satisfied that her financial position is such that she does not have any amount as a buffer for exigencies of life. Each lacks any reserves to meet demands, particularly of ill health, as she grows older. It is only with assistance that they are able to meet their outgoings which, by Australian standards, are modest. 'Need' in the context of the Act is not determined by reference only to minimum standards of subsistence.
Furthermore, because each of the Plaintiffs is unable to earn, or, in the case of Cvetanka, who has a limited means of earning an income, this gives rise, in my view, to an increased call on the estate of the deceased: Christie v Manera [2006] WASC 287; Butcher v Craig [2009] WASC 164 at [17].
I reject the submission, made on behalf of George, that the amount in the bank accounts in Macedonia provides adequate and proper provision for each of the Plaintiffs. However, I shall take into account the additional $6,000 to $6,500 that each will receive from those accounts at the second stage.
It is, then, necessary to consider whether to make a family provision order and the nature of any such order. In this regard, I do not forget s 9(3). I have earlier dealt with s 9(3)(a) of the Act. So far as s 9(3)(b) is concerned, there is nothing in the character, or conduct, of either Plaintiff, before, or after, the deceased's death, adverse to her claim. Although it was put, faintly, against the Plaintiffs, I am satisfied that not coming to Australia to care for the deceased, is not such as to disentitle either of them to the benefit of an order. It is not surprising that each was unable to provide the Defendant with assistance to care for the deceased bearing in mind the geographical distance between them.
Subsections 9(3)(c) and (d) are general and I have dealt with factual matters that may be relevant under one, or other, of these sub-sections.
I also bear in mind the deceased's statutory declaration and that it provides very sound reasons for the court to be slow to depart from her testamentary wishes: Kay v Archbold [2008] NSWSC 254 at [124].
It is true, as has been submitted by counsel for the Defendant, that the precise level of need has not been quantified. However, where what is being claimed is a fund for contingencies, or as a buffer, this would be difficult to do other than very generally. In any event, the determination of the quantum of proper provision is not arrived at by adding up all of the identified financial needs: Hyland v Burbidge at [56]). Importantly, each Plaintiff is no longer employed, and has no real prospect of further employment. Other than a pension, each has no stream of income and little property. In the case of Marika (although to a lesser extent Cvetanka) she suffers from ill health, as a result of which she may incur increased medical expenses in the future.
I also cannot ignore the Defendant's overall financial position (whether or not it includes more than he has attributed to his share of the superannuation). It was conceded by counsel for George, in my view properly, that he is not a competing financial claimant on the bounty of the deceased.
In all the circumstances I am of the view that provision for each Plaintiff should be made.
In determining the nature and quantum of the provision, I have had regard to the matters referred to above. Also, I do not forget the provision directly, or indirectly, made for each Plaintiff by the deceased (and by George), or the very clear obligation owed by her to George as accurately reflected in the statutory declaration that she signed. Nor do I forget his contribution, financially and otherwise, to the maintenance and repair of the principal estate property. However, I am not constrained by the practical considerations of the size and nature of the deceased's estate, and any competing financial claim upon the deceased's bounty.
In the case of Cvetanka, I am of the opinion that a lump sum of $79,000 should be provided to her absolutely out of the deceased's estate in New South Wales. This will not only provide a capital sum, but if properly invested, an income to supplement the pension amount that each receives. It should provide over and above a mere sufficiency of means upon which to live.
In the case of Marika, I am of the opinion that a lump sum of $93,000 should be provided to her absolutely out of the deceased's estate in New South Wales. For her too, that amount will not only provide a capital sum, but if properly invested, an income to supplement the pension amount that she receives. It should provide over and above a mere sufficiency of means upon which to live.
I have also considered the argument that each amount, whilst it may not seem very large by Australian standards, will provide a better standard of living for each Plaintiff in Macedonia. In this regard, although it was put in terms of "an award of a modest sum in Australian dollars would be of significantly greater value to the Plaintiffs in Macedonia", I consider that the better way of looking at this is by reference to the "station in life" of each of the Plaintiffs and how each might reasonably be expected to live in the future.
In reaching my conclusions as to the provision that should be made, the total amount of the provision is $172,000. I am satisfied that the size of the actual estate in New South Wales permits, and justifies, the provision that ought to be made. It will still leave property with a value of approximately $328,000 for George (even after the payment of costs as estimated).
The lump sum, in each case, should be paid within 28 days of the making of orders, or within such other time as the parties agree, failing which, interest on any amount not so paid, should be paid, such interest to be calculated at the rate prescribed on unpaid legacies by the Probate & Administration Act 1898, from that date until the date of payment.
The Exhibits should be dealt with in accordance with the Uniform Civil Procedure Rules.
Subject to any argument about costs, I would propose to make the usual order for costs.
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Decision last updated: 20 June 2011
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