Loretta Ann Picone v Stephen John Kirkby - [2002] NSWSC 1233

No judgment structure available for this case.

CITATION: Loretta Ann PICONE & Ors v Stephen John KIRKBY [2002] NSWSC 1233

CURRENT JURISDICTION: Equity

FILE NUMBER(S): SC 3563/01

HEARING DATE(S): 11/12/2002 to 12/12/2002

JUDGMENT DATE: 23 December 2002

PARTIES :

Loretta Ann Picone - first plaintiff
Nicola Picone Kirkby - second plaintiff
Marlow Robert Picone Kirkby - third plaintiff
Stephen John Kirkby - defendant

JUDGMENT OF: Acting Master Berecry at 1

COUNSEL : Mrs M. Gilmour - plaintiffs
Mr P. Hallan, SC/J. Viney - defendant

SOLICITORS: Stewart Cuddy & Mockler - plaintiffs
L.D. Rogers - defendant

CATCHWORDS: Large estate - de facto spouse - long & happy relationship - adequacy of provision - role as single mother - whether provision should enable plaintiff to remain out of the workforce until children complete secondary education - community expectations - competing claims - elderly mother - step siblings - primary duty of testator to spouse - children - no provision - reliance on cost of living report - provision for private education.

LEGISLATION CITED: Family Provision Act 1982

CASES CITED: Bosch v Perpetual Trustee Company Limited (1930) AC 463
Singer v Berghouse (1994) 181 CLR 201
Anasson v Phillips, unreported, Young J, 4.3.88
Gardiner v Gardiner, unreported, Santow J, 28.5.88
Marshall v Carruthers (2002), NSWCA 47, Hodgson AJA
Blackmore v Allen (2000) NSWCA 162, Sheller JA

DECISION: Refer para. 51.

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

ACTING MASTER BERECRY

MONDAY, 23 DECEMBER, 2002

3563/01 Loretta Ann PICONE v Stephen John KIRKBY

JUDGMENT

1 MASTER: On 16 July 2001 the plaintiffs commenced proceedings seeking an order pursuant to s 7 of the Family Provision Act 1982 (“the Act”). The plaintiffs are Loretta Ann Picone (the de facto wife of the deceased), Nicola Picone Kirkby (the daughter of the deceased and the first plaintiff) and Marlow Robert Picone Kirkby (the son of the first plaintiff and the deceased). Nicola is aged six years and Marlow is aged two years. The deceased was Robert James Kirkby. He died suddenly whilst jogging on 19 January 2000. Probate of his will was granted to the defendant on 26 July 2000. Therefore, the proceedings were commenced within time.

2 The Estate

ASSETS

Real Estate - Agreed Values

(a) 17 Union Street, Balmain $1,250,000

(b) 61 Short Street, Balmain $ 583,000

(c) 48 Evans Street, Rozelle $ 528,000

(d) 2a Ida Street, Putney $ 715,000

$3,076,000

Motor Vehicles

(e) Lotus Elan $ 25,000

(f) Brabham Racing Car - Not located

(g) Collection of assorted pieces of

racing cars $ 20,000

$ 45,000

Other Assets

(h) Yacht - $ 18,000

(i) Shares in Companies - $ 22,455

(j) Moneys on deposit - $ 107,370

(k) Moneys in St George Bank $ 77,997

(disclosed by Plaintiff and revealed in Ex.3].

(l) Moneys in trust account $ 7,648

$ 233,470

Assets not in NSW

(l) Real estate situated at Wellington

Street, Collingwood, Victoria $ 300,000

Distributions made

(a) Money to executor part - $ 59,000

share of residue

Total gross estate $ 3,713,470

LIABILITIES

(a) Defendant's Costs of the Proceedings $ 50,000

(b) Plaintiffs' Costs of the Proceedings

(on indemnity basis) $ 71,700

(c) Executor's Commission (estimated) $ 80,000

(d) Estimated Income tax liability on

rent collected $ 10,000

(e) Estimated agent's commission and

advertising expenses on sale of assets

(g) Estimated legal costs of sale of real

estate [excluding Union Street] $ 8,000

(h) Estimated Capital Gains Tax on real

estate [excluding Union Street] $ 131,954

(i) Estimated Yacht disposal and

brokerage costs $ 2,500

(j) Estimated brokerage on sale of shares $ 200

(k) Balance of the Funeral expenses $ 6,154

(l) The Plaintiff should receive $ 1,900

out of St George A/c being the

amount in that account at the date

of death. $ 426,188

Estimated Net Distributable Estate

(a) 17 Union Street , Balmain $ 1,250,000

(b) Net proceeds of sale of assets $ 2,037,282

Total estimated net distributable estate $ 3,287,182

3 Under liabilities item (b) is the plaintiffs’ expected costs on an indemnity basis of these proceedings. It has been calculated at $71,700.00. However, for the purposes of calculating those costs on a party/party basis I have discounted that amount by 20% resulting in a figure of $57,360.00. Therefore, the total amount of either current or expected liabilities if $411,848.00. The total estimated net distributable estate therefore is $3,301,622.00. If one were to exclude 17 Union Street, Balmain from that figure, the resulting figure is $2,051, 622.00.

4 The Will

2. After paying my debts, funeral and testamentary expenses and all probate and estate and other duties payable by my estate (with an actual notional) to any State or Federal Authority consequence of my death, I GIVE my estate to my trustee UPON TRUST to divide the same into 100 equal parts to be held upon the following trusts:-

(a) As to 40 such parts to my de facto wife Loretta Ann Picone absolutely, PROVIDED HOWEVER if she should fail to survive me by two months then five such parts to each of my siblings and the remaining 30 such parts to my mother absolutely.

(b) As to 40 such parts to my mother Jenny Myne Kirkby absolutely PROVIDED HOWEVER if she should fail to survive me by two months then five such parts to each of my siblings and the remaining 30 such parts to my de facto wife Loretta Ann Picone absolutely.

(c) As to 10 such parts to my said brother Stephen John Kirkby absolutely.

(d) As to the remaining 10 such parts to my sister Janice Ann Blackburn absolutely.

5 It was conceded by the defendant that the plaintiff is entitled to have the property known as No. 17 Union Street, Balmain transferred to her as part of the provision made by the deceased in his will. It is also conceded by the defendant that some provision ought be made for his two children.

6 The Plaintiff’s assets, income and liabilities

7 It is submitted by the defendant that the first plaintiff’s assets have a current value of $1,821,925.00. However, the plaintiff does not have access to the funds in her superannuation scheme. There are no current liabilities other than the day to day expenses that the first plaintiff incurs. However, evidence has been put on that she requires a new car, money to complete the renovations for 17 Union Street, Balmain and for the provision of white goods. The first plaintiff’s estimate of these items is $77,000.00. The plaintiff’s annual expenses have been estimated at approximately $49,000.00. The first plaintiff’s income is an area of some contention. According to the defendant, her total income is somewhere between $53,000.00 and $58,000.00. However, it is contended on behalf of the plaintiffs that in making that calculation the defendant has double dipped and has included income pursuant to superannuation pensions which go to the children and has over-estimated interest that the plaintiff will receive on deposits. The plaintiffs’ position is that the first plaintiff’s income for the last financial year amounted to $26,000.00. Exhibit “D” includes the first plaintiff’s tax return for the year ended 30 June 2002. That discloses a taxable income of $23,356.00. Also, included Exhibit “D” is a notice of assessment for the first plaintiff which shows her taxable income as being the amount in her tax return and provides for a refund on tax paid of $4,498.96.

8 The income the children have received by way of superannuation pension and family assistance is approximately $16,000.00. The first plaintiff relies on a schedule prepared by her solicitor to set out the needs of both children from 2002 until each attains the age of twenty years. The calculations are based on the premise that both children will go on to higher education and that their pension will continue to provide an income for them until they complete their tertiary education or until the age of twenty-five years. The solicitor has based his calculations on a report prepared by the University of Canberra called ‘The Cost of Raising Children in Australia’. The report was prepared by Richard Purceville and Ann Harding and was calculated on the estimated average costs of children as at March 2002. The report concludes that in terms of dollar value as at March 2002 the cost of raising two children until the end of the twentieth year is $448,000.00. This, of course, is on the basis that monies are earned, provided and expended during the course of that period rather than the money being available in full up front as at March 2002. The report breaks down the expenditure into the following categories: Housing, transport, recreation, education and child-care, food, clothing and other. It also breaks down the level of income of those people who formed the study for the report into low income, middle income and high income. The average income of three categories being $1,324.00 per week. The aid prepared by the plaintiff’s solicitor includes, up until the age of twelve years for both children, only living expenses. Thereafter, it includes each but not for each year, expenses such as school/tertiary, extra curriculae, uniforms and registration. Income is based on the superannuation entitlement they both have and the family assistance allowance. Up until the age of twelve years there is a surplus of income over expenditure. Thereafter, however, there is a deficit until the age of twenty years.

9 On the figures prepared by the solicitor, Nicola would require a capital sum to cover her for that period in respect of the expenses that I have mentioned, of $98,954.00. Marlow would require a capital sum until the age of twenty years, of $56,145.00. These amounts are readily conceded by the defendant as being reasonable and proper. However, the plaintiff submits that those figures are merely a starting point and there are other matters that need to be factored into the expenses of the children. It is said that there is no provision for contingencies for later on in their lives, namely, any assistance the deceased may have given to either of them to purchase property, no provision for landmark events such as attaining the age of twenty-one years or getting married. No provision for the deceased providing a motor vehicle to each child and no additional provision for special educational costs.

10 The plaintiff has provided however, a calculation by way of lump sum of an amount of $100,000.00 to cover those items. Nevertheless, whilst it is submitted that an allowance should be made for those type of contingencies, it is not said that that amount is necessarily the amount that should be provided for the children out of the estate. In dealing with that aspect of these proceedings, it seems to me that if the children were provided with a lump sum of $260,000.00 that figure would be adequate and proper to cover their needs until the age of twenty years. Those amounts can, in the case of Nicola, be invested for the next six years and in the case of Marlow for the next eleven years before there would be a need to draw on the capital. It would seem to me that in that period of time there would be a substantial increase in the capital by way of interest on the amount of $260,000.00. A number of the items that have been submitted as contingency items are matters, in my view, which do not necessarily relate to a need but more of an expectation or a wish. Therefore, in my view it would not be appropriate in all the circumstances to make greater provision for the two children, bearing in mind the fact that they will live with their mother until they decide to leave home and make their own way in the world, as most young Australians do.

11 In relation to the expenses set out in annexure “E” to the first plaintiff’s affidavit of 21 August 2001, namely expenses of just under $49,000.00 per annum, on current expenditure, in my view there are a number of items there which amount to double dipping. It is said on behalf of the plaintiffs that when those figures were calculated they were done on the basis of one child. However, it seems to me having regard to some of the categories that are set out in annexure “E” that it is clear that the first plaintiff has prepared the expenses on the basis of two children. Having regard to the calculations prepared by the plaintiffs’ solicitor, it seems to me that double dipping occurs. One must consider the basis upon which the solicitor has done the calculations, namely the report that I referred to earlier and the categories of expenditure set out in that report. Therefore, it is proper to make adjustments to items that relate generally to housing, recreation, education, child-care, food, clothing and other. Whilst it is rather vague and probably arbitrary, in my view it is the only assistance that one gets in relation to items such as medical and dental expenses.

12 Therefore, based on the calculations based at page 6 of that report for both children, in respect of the items council rates, water rates, house and contents insurance, repairs and maintenance, food, supermarket expenses, medical and dental, chemist, clothing, pre-school expenses, some reduction needs to be made to the annual expenses calculated by the first plaintiff. In my view, it is appropriate to discount the annual expenses of $49,000.00 by $11,000.00 thus rounding off the anticipated expenses of the plaintiff at $38,000.00 per annum. It can be seen that there is a shortfall in income in respect of expenses.

13 It is appropriate to consider the assets, income and expenditure of the other beneficiaries.

14 Stephen John Kirkby

At the commencement of the proceedings the defendant was employed as a bank employee with a salary of approximately $70,000.00 per annum. However, he was retrenched on 22 March 2002. His evidence was that he has done some work in the last twelve months. However, that work is not of a permanent nature. As a result of his retrenchment he received $51,000.00 which covered his redundancy, long-service leave and annual leave entitlements. In cross-examination it was put to him that he has also received $33,000.00 from a superannuation fund. He admitted that that was an additional asset that he has but failed to disclose in his affidavit. He also admitted in cross-examination that his wife had received a legacy from her late mother’s estate somewhere in the vicinity of $100,000.00. This amount also was not disclosed in any of his affidavits. The defendant’s wife works as a customer service representative on a part-time basis at the Commonwealth Bank. She earns approximately $430.00 net per fortnight. Their assets as at 21 June 2002 were as follows:-

Property at Quakers Hill valued at $340,000.00
Motor vehicle $ 30,000.00
Household furniture $ 30,000.00
Cash $ 24,000.00
Shares approximately $ 1,000.00
Superannuation entitlements $111,000.00

Their liabilities are as follows:-

15 Including the wife’s legacy and the defendant’s superannuation money, their assets are approximately $670,000.00. Their liabilities are $258,000.00. For the purpose of calculating their assets I have excluded the defendant’s ten-part share in the estate of the deceased. The defendant, therefore has a surplus of assets over liabilities to the extent of $412,000.00. The only foreseeable difficulty for the defendant is the uncertainty of his employment, either as a full-time or part-time employee.

16 Jenny Myne Kirkby

The deceased’s mother is Jenny Myne Kirkby. She lives with her daughter in a self-contained one bedroom fibro demountable house located on the daughter’s property. Her evidence is that she has no interest in the land although she owns the house. She receives a pension from veteran affairs each fortnight which is approximately $577.50. This is the sole source of her income. Out of the pension she makes payment in respect of electricity and telephone expenses and a contribution to the council rates. Her assets are describes as:

The demountable granny-flat $52,000.00
Furniture $ 3,000.00
Money in bank account $25,000.00
TOTAL $80,000.00

17 Janis Ann Blackburn

Janis Ann Blackburn is the sister of the deceased. She is employed four days a week as an agent at Westpac Bank and receives a gross average income of $528.00 per week. Her husband is employed as a computer analyst with the Australian Taxation Office and earns approximately $52,000.00 per annum. In 2002 Janis was retrenched and received retrenchment benefits totalling approximately $32,000.00. The current assets of she and her husband are as follows:-

$ 50,000.00

$353,000.00

18 I have not included the ten-parts of the deceased’s estate that Janice is entitled to. Their liabilities are as follows:-

Monthly rental income from the property $ 720.00

Personal Loan $ 9,000.00
Cost of care & maintenance of children $__________
Liabilities excluding cost of care &
Maintenance of the children $237,000.00

19 Background

20 The deceased was born on 3 August 1937. The plaintiff was born on 15 September 1961. The defendant and Janis were half-siblings of the deceased and both of whom were considerably younger. The deceased, after completing the Leaving Certificate continued his education at Sydney University and subsequently at a University in the United States of America until 1965. In that year he married his wife. However, that marriage was of short duration. He obtained employment at La Trobe University in Melbourne. In 1983 he met the plaintiff. It would appear that they began living together sometime in either 1985 or 1986. In any event, by 1986 the plaintiff had moved into the deceased’s residence at 80 Charles Street, Abbotsford in Victoria. The plaintiff met the deceased whilst she was attending University. At the completion of her degree she continued to work at the University as a research assistant. She continued in various positions within her professional discipline over the next ten years until the parties decided to move to Sydney just before the birth of Nicola. During this period the deceased was also employed. He worked both in academia and also had a private practice. The deceased appeared to have been an energetic person who had a wide range of interests. Those interests were not only recreational but also income producing and profitable.

21 The evidence is that the deceased had acquired all of the properties which formed the realty of the estate prior to the commencement of his relationship with the deceased. He had also owned the property at 80 Charles Street, Abbotsford. This property was subsequently sold.

22 The plaintiffs’ evidence, which is not robustly disputed by the defendant, is that after she and the deceased commenced their relationship she assisted him in relation to renovations of a number of properties, namely the Abbotsford property they resided in and subsequently, when they moved to Sydney 17 Union Street, Balmain. It would appear that 17 Union Street was a property which required extensive renovations and maintenance. The work commenced from the time they moved into the property in 1997 through until the death of the deceased. In fact, the property is still being renovated and a part of the first plaintiff’s evidence of need is that she requires an additional $30,000.00 to complete the renovations.

23 The first plaintiff has described in her evidence the nature of the work that she performed at some of the properties. Firstly the Charles Street property, her evidence is that she and the deceased undertook work of the following nature: Adding a bathroom, finishing a two car garage, paving and designing courtyard and gardens, sanding, painting and laying pavers, searching for and purchasing items of work, cleaning and rubbish removal. In respect of his property at Wellington Street, Collingwood in between tenants they performed the following tasks: Sanding and painting, general cleaning and rubbish disposal, locating and purchasing second hand kitchen appliances and fittings, replacing carpets and restoring the garden and similar work. Likewise, when they moved into 17 Union Street, Balmain they undertook extensive renovations which included extending the floor area, reconditioning most of the rooms, installing a new bathroom, kitchen and living room, installation and repainting of new doors, replacing a stained glass window and carrying out cleaning and rubbish removal together with landscaping. Some of this work was still in progress at the time of the deceased’s death. Following the deceased’s death the first plaintiff was responsible for a number of renovation projects.

24 It was readily conceded by the first plaintiff in cross-examination that in respect of the other properties the income produced by those properties was used to pay outgoings, rates and taxes as well as any work required by way of maintenance or renovation. She conceded that she made no financial contribution to any of the properties at all. However, in respect of the property at 17 Union Street, Balmain the first plaintiff’s evidence is that monies were paid into a joint account by both parties, her contribution being the redundancy pay she received prior to the birth of Nicola. From that fund monies were expended on the renovations at the premises. Therefore, the first plaintiff’s evidence is that she contributed in three ways to the Union Street property, namely by, firstly a financial contribution, secondly a physical contribution and thirdly she ran the household during the period of renovation.

25 There is some evidence put on by the defendant that he and his sons gave the deceased and the first plaintiff some assistance with respect to the renovation of the Balmain properties. However, the first plaintiff’s evidence is that the assistance they gave was no more than a day here and a day there and that the nephews were paid for the work that they did. In any event, it could not be said that there was a significant contribution made by the defendant towards the maintenance and renovation of the Balmain properties.

26 By 1999 the conditions that the parties were living in at Balmain was starting to take its toll. It would appear that the deceased became upset when he was told by the first plaintiff that she was pregnant with Marlow. The evidence is that it placed some stress on the relationship. The defendant’s evidence is that the deceased was going to end the relationship when he got back from Melbourne in January 2000 because he could no longer trust the first plaintiff as she had fallen pregnant against his specific wishes that he did not want to have a second child.

27 The first plaintiff’s evidence is that whilst there was stress and some tension at that point in time which was attributable in her view to the fact that she was pregnant but also because of the conditions under which they were living, it nevertheless was temporary. They both attended counselling and by Christmas 1999 the deceased seemed to have accepted the fact that there was to be an addition to the family. It seems to me that either way it is not a significant factor when one takes into account that as a couple they had lived together since at least 1986. They had worked together on projects at the University and they had worked together on their common interests of renovating the properties in which they resided. It would seem to me that up until late 1999 they had a perfectly happy and harmonious relationship. A relationship which gave both parties not only a physical and emotional satisfaction but also an intellectual satisfaction of equals.

28 As a result of the death of the deceased the first plaintiff now finds herself the sole parent of two very young children. Her evidence is that she and the deceased had an expectation that both children would progress to a tertiary education and that both, in the meantime desired for the children to attend private schools during their high school years. The first plaintiff admitted in cross-examination that the deceased was happy to see Nicola attend Balmain Primary School but thereafter he wanted her to attend a private school.

29 The defendant’s evidence, however is that the deceased was not particularly concerned that Nicola should have a private school education. The evidence was that as the deceased had a State school education he was of the view that she would not lose by enjoying a similar education. It may well be that from time to time when the brothers were talking that the deceased expressed a view in those terms. However, it is also reasonable to assume that having regard to the professional standing of the first plaintiff and the deceased and their life in academia that they would strive to provide the best for their children. When one adds to that the fact that he had acquired substantial assets during his lifetime, then it would not be unreasonable to assume that he would endeavour to put his children through private schools if he thought that they would gain some educational advantage by going into that system.

30 On this issue I prefer the evidence of the first plaintiff over that of the defendant.

31 Eligibility

It is not contested that the three plaintiffs are eligible persons within the meaning of s 6(1)(d) of the Act. The first plaintiff was the de facto spouse of the deceased at the time of death. The second and third plaintiffs are the children of that relationship.

32 Provision:

(a) The provision (if any) made in favour of the eligible person by the deceased person during the person’s lifetime or out of the person’s estate,….

…. is, at the time the court is determining whether or not to make such an order, inadequate for the proper maintenance, education and advancement in life of the eligible person.”

33 It is clear in respect of the second and third plaintiffs that no provision was made for them during the lifetime of the deceased other than in respect of the second plaintiff in which the deceased provided food, clothing and shelter for her. The third plaintiff, of course, was not born until after the deceased died. Clearly the defendant concedes that some provision ought to be made for the second and third plaintiffs. In Bosch v Perpetual Trustee Company Limited (1930) AC 463 the Privy Council considered the terms proper and adequate. So far as the second and third plaintiffs’ position no provision has in fact been made. Therefore, in all the circumstances it is appropriate that some provision be made out of the estate for their proper maintenance, education and advancement in life. I have referred to their needs earlier in this judgment. It is conceded by the defendant that some provision ought be made for those plaintiffs. However, there is not agreement on the quantum and the extent of their needs. For the reasons that I have already given in respect of the second and third plaintiffs, I am of the view that an amount in the sum of $260,000.00 should be made out of the estate for their proper maintenance, education and advancement.

34 The figures produced by the plaintiffs’ solicitor to my mind are proper to treat as a reasonable basis for making provision for the two children. In my view the figure of $260,000.00 should be apportioned in the following amounts, namely for Nicola a sum of $150,000.00 and for Marlow a sum of $110,000.00. Both of these plaintiffs are infants. There was some discussion during the course of the hearing as to what should be done in relation to any provision made for them. It would seem to me that in all the circumstances the most appropriate person to act as trustee for the provision made in respect to the second and third plaintiff is, in fact the first plaintiff, their mother. Subject to orders that are brought in by the parties the order I intend to make is that the first plaintiff be appointed as trustee of the sums provided out of the estate for the second and third plaintiffs.

35 In respect of the first plaintiff, she is to receive under the terms of the will 40 parts of the deceased’s estate. The deceased left a large estate. The first plaintiff under the terms of the will would be entitled to receive approximately $1,320,000.00. It is conceded by the defendant that the first plaintiff should be provided with the Union Street, Balmain property as that has been her home since she and Nicola moved to Sydney and it is the only home that Marlow has known. That leaves, on current value, approximately $70,000.00 to be provided to the first plaintiff pursuant to the terms of the will as a lump sum payment. The question is whether or not the deceased therefore has made adequate provision for the proper maintenance, advancement and education of the first plaintiff.

36 The first plaintiff conceded that she made no financial contributions to any of the properties owned by the deceased with the exception of 17 Union Street, Balmain. She readily conceded that in respect of most of those properties the rents received by way of income from those properties was sufficient to pay all outgoings including renovations and maintenance to them. She also conceded that all properties were purchased before she entered into a relationship with the deceased. It is hinted at by the defendant that the first plaintiff has not made a significant contribution towards the acquisition, conservation or improvement of the property of the deceased, see (s 9(3)(a)(i)) of the Act. However, that view fails to take into account the significant non-financial contributions that the first plaintiff had made during the course of the relationship and it also fails to take into consideration the financial contribution made by the first plaintiff with respect to the property known as 17 Union Street, Balmain.

37 In my view, the first plaintiff has made indirect contributions to the conservation and improvement of those properties, firstly by staying in the workforce until Nicola was born, thus she was able to use her money in a way in which the family benefited. That enabled the deceased to use part of his income to top-up or to provide additional funds if and when they were needed in respect of his investment properties. Her evidence is in respect of the Collingwood and Abbotsford properties, as well as Union Street, that she made a significant non-financial contribution to those properties. Those contributions by the first plaintiff may be regarded as an indirect contribution to the conservation and improvement of those properties. It seems to me that her contribution was very much a real and direct contribution by the work which by and large was not challenged by the defendant, which she carried out in respect of those particular properties. The major asset of the estate is in fact the Balmain property and it is to that property that the first plaintiff not only made non-financial contributions but also financial contributions. It seems to me therefore that the first plaintiff has made a significant contribution to the material welfare of the deceased.

38 The first plaintiff’s evidence which, once again is not greatly challenged is that they shared in a loving and harmonious relationship over a period of some fourteen years. During that time they worked together on research matters, worked on some of the properties carrying out renovations and maintenance, had a normal family relationship and in fact towards the end of the relationship two children were born of that relationship. It seems to me that as I indicated earlier, the first plaintiff gave the deceased much pleasure and companionship in respect of a number of areas of the relationship, i.e. emotional, physical and intellectual. She also was primarily responsible for the home duties, she did the washing and the cooking on most occasions. Towards the end of the relationship Nicola was born and, of course, after the death of the deceased Marlow was born. In my view, the first plaintiff had made a significant contribution towards the welfare of the deceased.

39 It goes without saying that the circumstances that the first plaintiff finds herself in since the death of the deceased are very much different from the circumstances that existed prior to his death. She no longer has his income to support the family; she is a sole parent with two young children; the possibility of her entering the workforce full-time in the foreseeable future is remote. Those circumstances, in my view are of sufficient weight to require the Court to exercise its discretion in favour of the first plaintiff.

40 In my view, in addressing the two stages referred to in Singer v Berghouse (1994) 181 CLR 201, the response to the first stage is that the provision made for the first plaintiff was inadequate. It follows not only from the reasons that I have already given, but when one looks at the will two things become apparent. Firstly, the will was made some nine years before the deceased died. It was made prior to the birth of the children and it also showed an intention of the deceased that should his mother not survive him by two months, the first plaintiff was to received 70% of his estate. There is some evidence that he had discussed with the first plaintiff in subsequent years that they ought to amend their wills. However, neither party got around to doing that. One would have thought with the birth of Nicola there was a watershed in their relationship which required both of them to give some consideration to the terms of their wills. Unfortunately, that did not happen.

41 It is submitted on behalf of the defendant that I should be slow to intervene and disturb the testamentary intention of the deceased. It has been submitted on behalf of the defendant that although this is a large estate I should still be wary of varying the testator’s testamentary intention. It is said that I should go no further than to make provision which will look after the needs of the first plaintiff. It is submitted that in coming to a conclusion I should consider the assets that the first plaintiff has, the income she receives, the professional training that she has, the potential to go back into the workforce and treat her desire to have the children educated at a private school as a wish rather than a need. Whilst not quantifying what the defendant submits would be proper in the circumstances, it seems to be suggested that it should be an amount which increases by a small amount, the first plaintiff’s entitlement under the will.

42 In Anasson v Phillips ,unreported, 4.3.1988 Young J whilst recognising the freedom of a testator to deal with his or her property in whichever way they think fit said that when the estate is a large estate the Court may make a more liberal assessment of the moral duty owed by the testator to be reflected in what is a proper provision for a plaintiff. In particular, his Honour made specific reference to the lifestyle that the plaintiff had enjoyed during the life of the deceased.

43 In Gardiner v Gardiner, unreported, 28.5.1988 at page 13 Santow J said the following:-

Elliott v Elliott,

Worladge v Dodridge

Rosenblum v Luciano

44 Recently, in Marshall v Carruthers (2002, NSWCA 47) the Court of Appeal drew attention to the distinction between de facto spouses and de jure spouses. However, Hodgson AJA made the following comment in the context of that distinction:

“One factor which may be particularly important in a claim by a woman is that a woman may have, to the detriment of her own financial prospects, taken a major role in raising children of herself and of the deceased.”

45 It is clear that the Court considered the role of the female as a major factor the role of raising children. In Blackmore v Allen, (2000, NSWCA 162), after reciting the facts Sheller JA at paragraph 34 made the following comments:-

“I have set out in a good deal more detail than the Master did the appellant’s account of her relationship with the testator. None of this was challenged. It leads me to the conclusion that the claim on the testator’s estate that the applicant had was the same as the claim she would have had if she had been married to him. It is a claim of a high order not to be satisfied by an amount which is no more than a bare subsistence and it is a claim which, in my respectful opinion, must be appropriately met out of the estate before any claim by the respondents be considered.”

46 It is clear from these authorities that where there has been a long, harmonious marriage, a large estate and a significant contribution of a financial or non-financial nature made by the surviving spouse regardless of whether or not she was a de facto or de jure spouse then provision for her should be of such quantum as to not leave her in a state of bare subsistence. During the deceased’s lifetime he made gifts to her by way of cash payments to the extent of $45,000.00 in respect of a property that she bought at 126 Charles Street, Abbotsford. Similarly, he also provided the net proceeds of sale of 80 Charles Street, Abbotsford to the defendant. Whilst the evidence is unclear on how precisely most of that money was spent, the first plaintiff still retains approximately $111,000.00. Whilst these are matters to be taken into account in determining what, if any, provision should be made for the first plaintiff out of the deceased’s estate, they need to be looked at in the context of the first plaintiff’s present and future needs. Whilst she will have two properties if she receives 17 Union Street, Balmain, her position will be that she will be asset rich but income poor. Whilst provision will be received through a superannuation pension and a family allowance for the two children which will go some way towards supplementing the family expenses, the first plaintiff, notwithstanding the Victorian investment, is still placed in a position where her expenditure will be greater than her income and her income, in any event, will be low.

47 In my view, on the authorities, the first plaintiff is entitled to a significant proportion of the estate. She is not only entitled to a fund of money which will enable her to continue with her present day to day lifestyle but place her in a position close to the lifestyle that she and the deceased formerly enjoyed. She is also entitled, in my view, to receive a sum in respect of any contingency which may arise in the future. The first plaintiff is forty-one years of age. There is always a possibility that she may remarry but that, of course, is just pure speculation. What the Court is faced with is the first plaintiff’s circumstances as they exist at the date of hearing.

48 The deceased’s primary responsibility was to the first plaintiff and then to the second and third plaintiffs. The other beneficiaries are his mother who is eighty-six years of age and his half-siblings. It is difficult to see that the deceased’s mother, an eighty-six year old lady has a need which is equal to that of the first plaintiff. In my view, the provision made for Mrs Kirkby is, in all the circumstances, out of all proportion to the responsibility and obligation the deceased had to his immediate family. In relation to his half siblings, it cannot be said that their needs are such that their legacies should not be interfered with. The evidence is that the brother has a surplus of assets over liabilities to the extent of $412,000.00. However, against that, is the fact that he is currently unemployed and for much of this year has only worked part-time. Nevertheless, it could not be said that his need could be regarded as a competing need with the first plaintiff. Similarly, Janice’s need could not be seen as competing with that of the first plaintiff. Whilst her net assets are not as great as her brother’s, she is working part-time four days a week and her husband is in full-time employment with the Australian Taxation Office. They have two properties, one being an investment property in which they currently have no equity but, nevertheless, one would assume that other than the tax benefit that they are receiving from that property there will come a time when the property will be of a financial benefit to them.

49 It has been submitted on behalf of the defendant that any provision that is made on behalf of the first plaintiff, in addition to the provision in the will should not factor into it the first plaintiff’s assertion that she needs to remain at home until Marlow completes his High School Certificate. What is required to be applied to these proceedings is the community expectations. It would seem to me that in 2002 the community’s expectations are not such that a single mother should stay home until all her children have completed their secondary education. This is more so in this particular case where the first plaintiff has a profession which, after suitable retraining she may be able to enter the workforce and earn a reasonable wage. In my view however, it is not unreasonable and may well be in accordance with community expectations that where possible a mother should remain out of the workforce and care full-time for her children until at least the end of primary school. In my view, there should be additional provision made for the first plaintiff, bearing in mind her age, the age of the children, the fact that her income is exceeded by her expenditure and the fact that she will require, from time to time, funds to purchase items such as household furniture and electrical goods, replace her motor vehicle and take the children on holidays, perhaps occasionally overseas. She should also be put in a position whereby she has adequate funding to carry out any maintenance work or renovations which would be required in respect of 17 Union Street, Balmain.

50 It was put to her as she was from Melbourne, had she considered returning to Melbourne. Her response to that question was an emphatic, no, she would not be returning to Melbourne. In my view, the first plaintiff should be able to enjoy, for as long as she wishes, the house at 17 Union Street, Balmain. She should be put in a position where she has sufficient funds to enable her and the children to remain at that property until she elects to move. She should also be left with provision which would enable her to meet any unforeseen expenses which may arise, whether they be in relation to the property or the purchase of goods. She should also be placed in a position where she has sufficient funding to take the children on holidays overseas on occasions. She should also be left in a position where she has funds which she can draw on for the children where the provision for them may not meet a particular requirement and also a fund which can be invested which will secure for her either an income to meet her expenses or to ensure that on retirement she has sufficient superannuation pension to continue to live in the style to which she is accustomed.

51 The orders that I make in favour of the first plaintiff is:-

1. In lieu of the provisions under the will of the late Robert James Kirkby the first plaintiff receive the property known as 17 Union Street, Balmain.

2. In addition to order 1, the first plaintiff received, by way of a lump sum payment out of the estate, the sum of $1,000,000.00.

3. The first plaintiff’s costs be paid out of the estate on the party/party basis.

4. The second plaintiff to receive out of the estate of the late Robert James Kirkby a lump sum in the amount of $150,000.00.

5. The second plaintiff’s costs be paid out of the estate on the party/party basis.

6. The third plaintiff receive by way of lump sum payment out of the estate of the late Robert James Kirkby the sum of $110,000.00.

8. The defendant’s costs be paid out of the estate on the indemnity basis.

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Last Modified: 01/24/2003

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Citations

Loretta Ann Picone v Stephen John Kirkby [2002] NSWSC 1233

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Statutory Material Cited

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Singer v Berghouse [1994] HCA 40

CITATION:	Loretta Ann PICONE & Ors v Stephen John KIRKBY [2002] NSWSC 1233
CURRENT JURISDICTION:	Equity
FILE NUMBER(S):	SC 3563/01
HEARING DATE(S):	11/12/2002 to 12/12/2002
JUDGMENT DATE:	23 December 2002
PARTIES :	Loretta Ann Picone - first plaintiff Nicola Picone Kirkby - second plaintiff Marlow Robert Picone Kirkby - third plaintiff Stephen John Kirkby - defendant
JUDGMENT OF:	Acting Master Berecry at 1

COUNSEL :	Mrs M. Gilmour - plaintiffs Mr P. Hallan, SC/J. Viney - defendant
SOLICITORS:	Stewart Cuddy & Mockler - plaintiffs L.D. Rogers - defendant
CATCHWORDS:	Large estate - de facto spouse - long & happy relationship - adequacy of provision - role as single mother - whether provision should enable plaintiff to remain out of the workforce until children complete secondary education - community expectations - competing claims - elderly mother - step siblings - primary duty of testator to spouse - children - no provision - reliance on cost of living report - provision for private education.
LEGISLATION CITED:	Family Provision Act 1982
CASES CITED:	Bosch v Perpetual Trustee Company Limited (1930) AC 463 Singer v Berghouse (1994) 181 CLR 201 Anasson v Phillips, unreported, Young J, 4.3.88 Gardiner v Gardiner, unreported, Santow J, 28.5.88 Marshall v Carruthers (2002), NSWCA 47, Hodgson AJA Blackmore v Allen (2000) NSWCA 162, Sheller JA
DECISION:	Refer para. 51.