Low v Hunt

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION
TRUSTS, EQUITY AND PROBATE LIST

S ECI 2024 00425

IN THE MATTER of the estate of PHILIP RAYMOND FLINN, deceased

-and-

IN THE MATTER of 34(1)(c) of the Administration and Probate Act 1958 and ss 48(1) and 55 of the Trustee Act 1958

BETWEEN:

JENNIFER ELIZABETH LOW (in her capacity as trustee of the bankrupt Estate of Jeannette Helen Hunt)	Plaintiff
v
JEANNETTE HELEN HUNT (in her capacity as administrator of the estate of Philip Raymond Flinn, deceased)	Defendant

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JUDGE:	FORBES J
WHERE HELD:	Melbourne
DATES OF HEARING:	7 November 2024, 18 December 2024 and written submissions of 17 January 2025 and 31 January 2025
DATE OF JUDGMENT:	6 March 2025
CASE MAY BE CITED AS:	Low v Hunt
MEDIUM NEUTRAL CITATION:	[2025] VSC 80

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ADMINISTRATION AND PROBATE – Application by bankruptcy trustee to remove administrator – Whether defendant has failed to fulfil duties as administrator – Dispute between plaintiff, as bankruptcy trustee of the defendant, and the defendant, in her personal capacity, as to payment of bankruptcy costs – Deceased’s estate not subject to bankruptcy – Trustee in bankruptcy standing in shoes of the bankrupt beneficiary – Whether the Trusts, Equity and Probate List is the proper forum for the real issues in dispute – Administration and Probate Act 1958 s 34(1)(c) – Trustee Act 1958 s 48.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	B Ridgeway on 7 November 2024 N Baum on 18 December 2024	Harris Carlson Lawyers
The Defendant in person via Audiovisual link	-	-

HER HONOUR:

A Introduction

Jeanette Hunt (Hunt) is the administrator of the estate of her late husband, Philip Flinn, who died intestate on 23 June 2018. Hunt is the sole beneficiary of Philip’s estate.
On 18 January 2021, Hunt, in her personal capacity, filed a debtor’s petition for bankruptcy owing debts of $19,263. Subsequently, on 26 April 2022, Jennifer Low (Low) was appointed trustee of the bankrupt estate of Hunt.
On 1 February 2024, following an ongoing dispute between the parties, Low filed an originating motion seeking orders pursuant to s 34(1)(c) of the Administration and Probate Act 1958 (the Act), removing Hunt as administrator of the deceased’s estate and the appointment of Low, or alternatively such person as the Court sees fit, as administrator and trustee of the deceased’s estate (the application). The dispute concerns Hunt’s failure to fully administer the estate by distributing assets to herself as sole beneficiary.
The application was listed for hearing on 7 November 2024. On that day, Low was represented by counsel. Hunt, who lives in Shepparton, did not travel to appear in person and observed the hearing by video-link. Hunt did not seek to appear or participate in the hearing.

B The facts

Hunt was born on 2 September 1969. Some time before November 2017, she and her late husband, Philip, relocated from the United Kingdom. They lived at 5 Cheshire Court, Shepparton (the Shepparton property) with Philip’s mother, Jean Flinn, to look after Jean.[1] Hunt receives a Disability Support Pension from Centrelink and has a number of medical conditions.[2]
[1]Affidavit of Jeannette Helen Hunt affirmed 11 June 2024, [15] (Hunt Affidavit). Without any disrespect to the parties, in the interests of clarity, I will refer to the late Philip Flinn and Jean Flinn by their first names.
[2]Ibid [11]–[12].
Jean owned the Shepparton property. On 29 November 2017, Jean signed a transfer of land to her son Philip for ‘natural love and affection’. Philip became the sole registered proprietor on 3 January 2018.[3]
[3]Ibid [16].
At the same time that Jean signed the transfer of land, she also signed an agreement which granted her a life tenancy to reside at the Shepparton property (the granny flat agreement).[4] Hunt was not a signatory to that agreement.[5]
[4]Ibid.
[5]Ibid.
On 11 October 2018, following Philip’s death, Jean lodged a caveat over the Shepparton property protecting her interest arising from the granny flat agreement (Jean’s caveat).[6] Jean also commenced a proceeding on 26 September 2019 in the County Court of Victoria seeking provision from Philip’s estate under Part IV of the Act (the Part IV proceeding).[7] There had been negotiations in relation to the Shepparton property. However, Jean died on 16 July 2021 before the Part IV proceeding was finalised, and on 5 August 2021, the Court made consent orders dismissing the proceeding without orders as to costs. Hunt believes this was because of Jean’s death.[8]
[6]Ibid [18].
[7]Ibid [19].
[8]Ibid [22]–[23].
On 21 March 2019, Hunt obtained letters of administration of Philip’s estate.[9] The inventory of Philip’s estate listed a motorcycle (since sold), a UK bank account (since closed), and the Shepparton property.[10] Hunt has continued to live in the Shepparton property save for a 12 month period while Jean was alive between 2019 and 2020. Hunt has paid various expenses including rates, outgoings and insurances.
[9]Affidavit of Jennifer Elizabeth Low affirmed 1 February 2024, [7] (First Low Affidavit).
[10]Ibid [12].
On 18 January 2021, Hunt initiated bankruptcy by filing a statement of affairs with the Australian Financial Security Authority (AFSA). Hunt did not obtain legal advice in relation to the bankruptcy application. The total debt owing was $19,236 with amounts owed to two law firms, Maurice Blackburn and Shine Lawyers.[11] Hunt’s bankrupt estate was managed by the official trustee from AFSA until 26 April 2022, when Low was appointed as trustee.[12] Extensive correspondence, some of which is detailed below, has been exchanged since the Low’s appointment.
[11]Hunt Affidavit, [21].
[12]Ibid [24].
Low’s solicitor wrote to Hunt on 25 October 2022 requesting that Hunt transfer the Shepparton property from the deceased’s estate to herself as beneficiary and thereafter to Low, so that Low as trustee in bankruptcy could take control of and sell the property to administer the bankruptcy. Shortly after Low’s appointment, Hunt wrote to her in the following terms:
You can just take your hands off my property you can’t have it, it belongs to my late husband.[13]
[13]Further Affidavit of Jennifer Elizabeth Low affirmed 12 July 2024 , Exhibit JEL–2, 49, email dated 20 June 2022 (Second Low Affidavit).
On 9 November 2022, Alan Flinn, Philip’s brother, and the executor of Jean’s estate, wrote to Low foreshadowing a claim against the Shepparton property by Jean’s estate and an intention to maintain Jean’s caveat.[14] Hunt deposes that she was not aware of that letter at the time. She learnt of Alan Flinn’s intentions from her solicitors in February 2023.
[14]Hunt Affidavit, [26].
In November 2022, Hunt directly paid all outstanding creditors a total of $21,860 including interest, and advised Low that she had done so.[15]
[15]Ibid [28]. The affidavit identified the two law firms mentioned above at [9] and two other small debts.
An issue remained as to the fees and charges incurred by Low in administering the bankrupt estate. By a letter of 23 December 2022, Low advised that creditors were not competent to receive payment of debts directly, and that the bankruptcy could not be annulled pursuant to s 153A of the Bankruptcy Act 1966 (Cth) (Bankruptcy Act) until charges, renumeration and expenses incurred by Low and the official trustee in bankruptcy were paid.[16] As at that date, the fees and disbursements to annul the bankruptcy were estimated to be $90,173.92.
[16]First Low Affidavit, Exhibit JEL-1, 200–203.
Low rejected a proposal offered by Hunt for an instalment payment plan and the gave notice that that if she did not receive payment in full within 30 days, Low would commence proceedings to replace Hunt as the administrator of Flinn’s deceased estate so that she can realise the Shepparton property.[17]
[17]Ibid.
Between February 2023 and June 2023, Hunt engaged solicitors to assist in resolving the dispute over fees associated with administering the bankrupt estate. She also sought legal advice regarding Jean’s caveat and the claim against the Shepparton property which had been foreshadowed by Alan Flinn. At that time, she had been advised that as she was an undischarged bankrupt, there were difficulties lodging an application to lapse the caveat or defend resulting court proceedings.[18] Low’s solicitor recommended having Hunt registered on the title in her capacity as administrator and otherwise declined to provide any legal advice.[19] The letter otherwise provided a final opportunity to make various arrangements to pay the outstanding debt of fees, disbursements and charges in full in order that the bankruptcy could be annulled.
[18]Hunt Affidavit, [30].
[19]Second Low Affidavit, Exhibit JEL-1, 7.
Hunt disputes the basis for the fees and disbursements incurred in administering the bankruptcy. She contends that the quantum of the fees is disproportionate. On 27 October 2022, Hunt made a telephone complaint to AFSA alleging that the proposed sale of the property by the trustee in bankruptcy would leave her and her husband without accommodation. On 17 June 2023, Mr Hunt made a second complaint on behalf of his wife with regards to the quantum of fees and the lack of information as to what work those fees represented. The details of this are set out in the plaintiff’s affidavit of 12 July 2024 and the exhibited correspondence.[20] AFSA made a ‘without prejudice’ offer to the plaintiff and Mr Hunt in early August 2023,[21] however, the matter did not resolve. A third complaint was outstanding at the time of the November hearing. I am informed it has been dismissed subsequently although there is no evidence of the outcome or reasons.
[20]Ibid [19]–[24].
[21]Ibid [23].
As at February 2024, Low swore that the amount required to annul the bankruptcy was $143,470.39. The exhibited statement demonstrates that this amount includes an amount of $21,860 that has been paid directly to creditors. The remaining amount of $121,610.30 comprises the trustees fees and expenses incurred to 21 December 2023 and into the future (the future component accounting for $38,700) and an AFSA realisation charge payable to the Commonwealth.
On 3 August 2023, Mr Hunt applied for a personal safety intervention order, with Hunt as the affected person, against Low and her solicitor. Mr Hunt’s complaint was that Low was harassing his wife, who was threatened with homelessness due to the proposed sale of the Shepparton property.[22] The applications were struck out.[23] Low’s affidavit of 12 July 2024 estimated the costs incurred in opposing Mr Hunt’s application to be $10,890.50. However, the extract of orders made on 21 August 2023 make no reference to an order for costs. It is therefore unclear whether Low’s estimate forms part of the updated fees incurred in administering Hunt’s bankruptcy.
[22]Ibid, Exhibit JEL-2, 148–155.
[23]Ibid 156–157.
Low deposes to receiving many emails from Hunt in the two months following her request in October 2022 that the property be transferred to her as the beneficiary’s trustee in bankruptcy. She said none addressed the transfer of the property. In further correspondence, solicitors for Hunt wrote on 23 May 2023 communicating an offer to pay a lump sum of $10,000 and then the balance owing on a fortnightly payment plan. In the context of this offer the letter concluded:
Until such time as her bankruptcy has been annulled [Hunt] does not wish to administer the estate of her late husband.[24]
[24]First Low Affidavit, [32].
On 24 January 2024, Hunt was discharged from bankruptcy upon expiry of the relevant three year period.[25] On 1 February 2024, Low commenced this proceeding.
[25]Hunt Affidavit, [33].
The property has now been transferred into Hunt’s name in her capacity as the legal personal representative of Philip’s estate.[26] Although I have no evidence as to the nature of the proceeding recently commenced by Alan Flinn, I proceed on the basis that any claim on Philip’s estate will need to be determined before his estate can be further distributed.
[26]Second Further Affidavit of Jennifer Elizabeth Low affirmed 17 December 2024 (Third Low Affidavit), Exhibit JEL-3, 49, 76–77.
At the hearing on 7 November 2024, I made reference to the impasse regarding the administration of the deceased’s estate. Conscious of the costs, I proposed adjourning the proceeding for one month to give Hunt an opportunity obtain legal advice and progress the issues she is facing. I also provided the parties with an opportunity to attend a judicial mediation in an effort to resolve those issues. Both parties confirmed that they would be prepared to attend. I made orders in respect of both parties that they must attend in person unless represented by a lawyer. If legally represented they were able to participate remotely. I asked Hunt about her access to legal advice. She indicated she had a lawyer taking care of a caveat on the property.[27] She was unsure about whether she could obtain legal advice in respect of a mediation. The Court provided her with information to apply to the Victorian Bar pro bono scheme. Ultimately pro bono assistance was not available for the mediation. Hunt did not attend the mediation. She communicated informally with the Court of difficulty in doing so.
[27]Transcript of Proceedings, Low v Hunt (Supreme Court of Victoria, S ECI 2024 00425, Justice Forbes, 7 November 2024) 33.4–5 (‘T’).
At the mention listed immediately after the scheduled mediation, Hunt appeared by audiovisual link but there were technical problems that prevented her from adequately hearing or participating in the proceeding. As a result, I made orders that any further submissions on the substantive application for removal of Hunt as administrator of the deceased’s estate be made by way of further written submissions. Low also indicated she wished to make application for costs of the mediation on an indemnity basis. Low provided further written submissions dated 17 January 2025. Hunt provided submissions by email to chambers on 31 January 2025. Low subsequently received copies of Hunt’s submissions on 3 February 2025 by email from the Court to all parties noting that a copy of Hunt’s submissions had not been provided to Low.

C Principles

Removal of an administrator

Section 34 of the Act grants the Court power to remove an executor or administrator of a deceased’s estate. Section 34(1)(c) reads:
Notwithstanding anything contained in any Act where an executor or administrator to whom probate or administration has been granted …
…. or
(c) after such grant or appointment refuses or is unfit to act in such office or is incapable of acting therein—
the Court upon application in accordance with the Rules of Court may order the discharge or removal of such an executor or administrator and also if the Court thinks fit the appointment of some proper person or trustee company as administrator in place of the executor or administrator so discharged or removed upon such terms and conditions as the Court thinks fit …
Removal may be ordered where the appointee refuses to or lacks capacity to act as well as when the appointee is unfit to act. Unfitness to act is a consideration broader than circumstances of misconduct.[28] Considerations are analogous to those applicable to the removal of a trustee.[29] In that context, the statement of principle in Miller v Cameron[30] is applicable to an application under s 34(1)(c) of the Act. Dixon J said:
The jurisdiction to remove a trustee is exercised with a view to the interests of the beneficiaries, to the security of the trust property and to an efficient and satisfactory execution of the trusts and a faithful and sound exercise of the powers conferred upon the trustee. In deciding to remove a trustee the Court forms a judgment based upon considerations, possibly large in number and varied in character, which combine to show that the welfare of the beneficiaries is opposed to [their] continued occupation of the office. Such a judgment must be largely discretionary. A trustee is not to be removed unless circumstances exist which afford ground upon which the jurisdiction may be exercised.[31]
[28]Monty Financial Services Ltd v Delmo [1996] 1 VR 65, 77 (Monty).
[29]Ibid 82.
[30]Miller v Cameron (1936) 54 CLR 572.
[31]Ibid 580–581.
The many and varied circumstances that might be the basis for removal include inordinate delay in administration of the estate, a failure to communicate with beneficiaries, a failure to account to beneficiaries or inordinate delay in distribution of the estate, and dealing with assets of the estate contrary to the best interests of the intended beneficiaries. Such acts or omissions may result in removal whether they were intentional, careless or the result of incompetence.
A potential for a conflict of interest between the duty as executor or administrator and the interest as beneficiary, may be, but is not necessarily, a circumstance in which an executor or administrator may be unfit to act in that capacity.[32] The fact that an executor or administrator is also a beneficiary is, without more, generally not sufficient to demonstrate that the person appointed is unfit to act in the office.[33]
[32]Monty (n 28) 82.
[33]Ibid 83.
Where the administrator or executor is also the sole beneficiary, any conflict arising with the interests of the beneficiaries rarely arises. We have not been made aware of, nor located any cases of removal of a sole administrator and beneficiary of an estate other than for incapacity.
Standing to remove the administrator
A question arises as to Low’s standing as trustee in bankruptcy to apply for the removal of the administrator of the deceased’s estate. As trustee in bankruptcy, Low’s interest is in any property of Hunt, not that of the deceased estate. ’Property’ is defined in the Bankruptcy Act to mean:
real or personal property of every description, whether situate in Australia or elsewhere, and includes any estate, interest or profit, whether present or future, vested or contingent, arising out of or incidental to any such real or personal property.[34]
[34]Bankruptcy Act s 5 (definition of ‘property’).
A beneficiary of a deceased’s estate has no proprietary right in any asset of the estate until distribution from the estate.[35] However, on a person’s death, those benefiting from their estate acquire a right to have the estate administered in accordance with the duties of those charged with its administration.[36] For a bankrupt person, that right to due administration vests in the trustee in bankruptcy. Any interest of the beneficiary that is derived from their interest in due administration of the deceased estate, also vests in the trustee in bankruptcy.[37]
[35]Official Receiver in Bankruptcy v Schulz (1990) 170 CLR 306 (Schulz).
[36]Ibid 314 (Schulz).
[37]Ibid.
Vesting property of a bankrupt in their trustee in bankruptcy occurs on the day of appointment of the trustee.[38]

D Submissions

[38]Bankruptcy Act (n 34) s 132.

D.1 Plaintiff

Low submits that Hunt ought be removed as administrator because:[39]
(a)she has an obvious and apparent conflict of duty and interest. On the one hand, as administrator she is obliged to realise and distribute the property to the beneficiary of the estate. On the other hand, in her personal capacity she has an interest in the estate remaining unadministered, denying the trustee in bankruptcy the capacity to realise the property for the benefit of Hunt’s bankrupt estate;
(b)she has expressly refused to perform her duties as administrator on at least two occasions, as evidenced by the emails of 29 June 2022 and 23 May 2023;
(c)there has been substantial and inordinate delay in the administration of the deceased estate since letters of administration were granted five years ago, and delay in resolving the issue of Jean estates’ interest in the property since lodgement of the caveat in October 2018; and
(d)she has failed to communicate with beneficiaries, namely the trustee in bankruptcy in whom Hunt’s right to due administration vested. This is exemplified by the example ‘[you the plaintiff] can get stuffed as far as I am concerned’[40] together with the Hunt’s refusal to recognise Low’s legal entitlement to the Shepparton property.
Low submits there is now a further reason for Hunt’s removal. Her further submissions dated 17 January 2025, say:[41]
(e)now that the executor of Jean’s estate has commenced a proceeding to maintain that estate’s caveat, it is submitted that Hunt is unsuited to defend that proceeding because she has been unable to maintain legal representation previously in her capacity as administrator and so has demonstrated an unsuitability for the conduct of litigation.
[39]Plaintiff’s Outline of Submissions dated 30 August 2024, [36] (Plaintiff’s First Submissions).
[40]Second Low Affidavit, Exhibit JEL-2, 43.
[41]Plaintiff’s Outline of Submissions dated 17 January 2025, [58] (Plaintiff’s Further Submissions).

Low submits that the disputes regarding the costs incurred by her in her capacity as Hunt’s trustee in bankruptcy are not before this Court exercising its probate jurisdiction. [42] Three complaints to AFSA have been rejected. If Hunt is not satisfied with the sum claimed by the trustee in bankruptcy or the sum approved by creditors, which was $40,000, s 90-15 of Schedule 2 of the Bankruptcy Act provides a process for Hunt to apply for orders regarding the trustee in bankruptcy’s remuneration.[43]
[42]Ibid [35]–[41].
[43]Ibid [40].
Further, any concession to this Court that the original debts of the bankruptcy had been discharged was wrongly made.[44] The bankruptcy disabled Hunt from paying creditors directly. Those creditors have only a right to prove the debt against the bankrupt estate.[45] Low submits that the criticism that this proceeding is in essence a mechanism for pursuing costs is an unfair criticism. Rather a prompt conclusion of the bankruptcy administration including payment of the costs and charges of administration would have increased funds available to Hunt on annulment.
[44]T, 10–11.
[45]Plaintiff’s Further Submissions, [29], citing Clyne v Deputy Commissioner of Taxation (1984) 154 CLR 589, 594–595 (‘Clyne’).
Although Low initially sought her own appointment as administrator of the deceased estate, she did not press this relief in her further submissions. Instead, she seeks only the appointment of an independent administrator, Mr Patrick Lyttleton.

D.2 Defendant

Although Hunt did not participate in the hearing, she has made written submissions and opposes the application to remove her as administrator. Her position is:
(a)she is capable of administering the deceased’s estate and has taken steps to do so. She did not take steps in relation to the caveat of Jean’s estate from November 2022 as she was not aware of the letter of demand until February 2023. She then engaged solicitors between February and June 2023 for advice on this and other issues including the costs of administering her bankrupt estate. She also engaged lawyers in early 2024 when this proceeding was commenced; [46]
(b)her disagreements with Low relate to her bankruptcy and have nothing to do with the deceased’s estate;[47]
(c)upon discharge from bankruptcy she has directed lawyers to transfer the property into her name as Philip’s legal personal representative;[48]
(d)the bankruptcy was commenced on the filing of a debtor’s petition and the creditors have received the funds owing in full. The only outstanding matter is the costs and charges associated with administering the bankruptcy and Hunt believes those costs to be disproportionate and excessive. She has taken steps to dispute those fees, including a third complaint that remained outstanding as at 7 November 2024;[49]
(e)Low would have a conflict between her duty as administrator of the deceased estate if appointed and her interest as trustee in bankruptcy with fees and charges likely to be paid from estate assets on transmission to her as beneficiary;[50]
(f)Hunt’s own health issues have made it difficult to communicate or to progress matters; and[51]
(g)selling the property is not necessary for the payment of reasonable costs and charges and would have the effect of rendering Hunt homeless.[52]
[46]Hunt Affidavit [28]–[29], [34].
[47]Defendant’s Further Submissions dated 31 January 2025 (Defendant’s Further Submissions), 1–3.
[48]Hunt Affidavit [40].
[49]Defendant Submissions dated 31 January 2025 (Defendant’s Submissions), 4.
[50]Hunt Affidavit, 6.
[51]Defendant’s Submissions, 3.
[52]Ibid, 2.

E Consideration

Although Hunt sees the property as belonging ‘to her late husband’,[53] the legal position is clearly that it forms part of his estate until transferred to the beneficiary. Hunt has been appointed as the personal representative of that estate, charged with the responsibility of getting in the assets of the estate and paying expenses and distributing those assets in accordance with the laws of intestacy.
[53]Second Low Affidavit, Exhibit JEL-2, 43.
Even though the property remains part of the deceased’s estate, Hunt’s rights, as beneficiary, as a matter of law, vested in the trustee in bankruptcy from January 2021.[54] Her right is not an interest in the property itself as an asset of the estate, but a right to enforce the proper administration of the estate by the personal representative of the estate. The right of Hunt as beneficiary is to due administration of the estate by her as administrator.
[54]Schulz (n 36).
Hunt’s subsequent discharge from bankruptcy operates to release her from all her debts provable in the bankruptcy,[55] even if her payment directly to creditors itself did not discharge the original debts at that time.[56] The only impediment to annulment that has been identified are the costs, charges and expenses of the administration of the bankruptcy, largely the remuneration and expenses of Low.
[55]Bankruptcy Act (n 34) s 153(1).
[56]Clyne (see n 45) at 594.
Low, standing in the shoes of Hunt as beneficiary, does have the right to enforce proper administration of the deceased’s estate, and to the fruits of that administration when it is completed. Assuming the property is not to be sold to meet any liabilities of the deceased’s estate, then on transfer to Hunt as beneficiary, the property would vest in Low as trustee in bankruptcy and the property could be realised to meet Hunt’s outstanding bankruptcy fees.[57]
[57]Plaintiff’s Further Submissions, [33].
As a result, it is clear that Low if appointed as administrator of the deceased’s estate, would have a conflict of interest. In these circumstances, it was appropriate that Low not press to be appointed as administrator of the deceased’s estate.
The central question for consideration is whether to remove Hunt as administrator. If so it will be necessary to appoint an independent person.
While there has been delay in distributing the remaining, and only substantial asset of the deceased’s estate, as Hunt is the sole beneficiary of the estate this delay has not prejudiced any other beneficiary. Further, some aspects of the Hunt’s delay in administering the estate are understandable where there lay confusion as to whether she could administer the estate whilst bankrupt, and with the existence of caveats over the property. Whilst this does not excuse the entirety of the period of delay, it does go some part in explaining a portion of it. Further, any prejudice caused by delay since January 2021 prejudices Hunt herself as beneficiary because of the increasing costs liability she is incurring in the dispute regarding her bankruptcy.
The application for her removal as administrator rests largely on Hunt’s significant delay and refusal to finalise the deceased estate. Low submits that Hunt’s delay is preventing the trustee in bankruptcy from realising equity in the property for the benefit of Hunt’s bankrupt estate.[58] While this is technically correct, in a practical sense the only outstanding creditors of the bankrupt’s estate when this application was issued after discharge from bankruptcy, are those appointed to administer her bankruptcy. In this context any issue of prejudice is one in the context of an ongoing cost dispute between the parties.
[58]Plaintiff’s Submissions [2].
There has undoubtedly been a lengthy delay in transferring the property into the name of the administrator as has now occurred. Jean’s interest, and more recently that of Jean’s estate in the Shepparton property has at times and presently remains a claim on the deceased estate that is to be resolved before Philip’s estate can be finally distributed.
Hunt has twice said she would not yet complete administration of the estate. The first occasion was the email of 29 June 2022, written in the context of an offer to resolve Low’s costs. Similarly, in May 2023, the wish to delay administration of the deceased’s estate was not a bald refusal but expressed in the context of an offer to resolve outstanding costs. Clearly that offer was not acceptable, although no response was exhibited.
The payment of the bankruptcy costs must be resolved. However, I accept that the question of the bankruptcy costs, including Low’s costs, are not in issue before me. While observing that Low’s submissions note that she will require approval for remuneration above the $40,000 approved by creditors, it is not otherwise possible or appropriate to express a view about whether the present estimate of fees and charges incurred is reasonable or appropriate. There is, as identified in Low’s submission, a process under the Bankruptcy Act for court oversight of the costs of a trustee in bankruptcy. This Court is concerned with oversight of the administration of the deceased’s estate only. The dispute between a bankrupt, now discharged, such as Hunt and her trustee in bankruptcy as to the nature of the work done and the fees charged is a matter for the Federal Court or Federal Circuit Court.
The question of delay is nevertheless a relevant matter. Delay prior to January 2021 is of marginal relevance. When the bankruptcy petition filed on 18 January 2021, the property was encumbered by Jean’s caveat which was an impediment to distribution of the property out of the estate until Jean’s passing. I accept that from this time until early 2024 no step was taken to transfer the property into Hunt’s name in her capacity as administrator. During part of this time Hunt was legally represented and while I do not have the benefit of knowing the legal advice she received, it is fair to say from the letter written by her lawyers dated 23 May 2023 there was a question mark in their minds over her capacity to take these necessary steps to transfer the property into her name. In any event, Low’s complaint is not so much that the property was not transferred to the legal personal representative of the deceased, but that it was not distributed to the beneficiary.
Since the substantive matter was argued, I have been informed that Alan Flinn in his capacity as executor of Jean’s deceased estate has commenced County Court proceedings against Hunt in her capacity as administrator. I do not accept the submission that this Court has evidence that is directed to Hunt’s suitability to conduct those proceedings, still less evidence upon which to adjudge her unsuitable to do so. At best I am asked to draw an inference as to her unsuitability from her decisions to present at time as a self-represented litigant. While there may be issues that will arise in how she conducts any defence, given she is both beneficiary and administrator, she is otherwise entitled to choose her legal representation in that matter. I am not persuaded that presently there is any basis for this Court to remove her generally as administrator because of proceeding issued by Alan Flinn.
In my view the County Court proceeding now commenced by Alan Flinn is relevant in that it may have a bearing on the capacity to transfer the Shepparton property to Hunt. The administrator of the deceased’s estate, whoever that person may be on determination of this application, will need to determine whether there is any amount payable to Jean’s estate. That amount will depend on a court finding or resolution of the new County Court proceeding. The claim by Jean’s estate will affect the interest of Hunt as beneficiary and that same interest of Low standing in her shoes. Only then can the ‘fruits’ of the right to due administration be identified. The residual estate can be transferred to the sole beneficiary, or to her trustee in bankruptcy as appropriate. The costs dispute will not be advanced by this process.
The course of action embarked upon by Hunt and delay in transferring the property into her own name may not be in her own financial interests. However, she is not subject to any legal or mental incapacity that would subject her decisions to a supervisory role by this Court. Ultimately I am not persuaded that the delay, nor the relationship of conflict with her trustee in bankruptcy are sufficient reasons presently to remove her as administrator and appoint an independent person to administer the deceased’s estate. As the sole beneficiary her opposition to such a course of action is a relevant factor for me.
This is a highly unusual removal application. It is an application brought against a sole administrator-beneficiary, by a bankruptcy trustee of the administrator personally, in circumstances where there is an ongoing bankruptcy costs dispute persisting after discharge of the bankruptcy.[59]
[59]There are avenues available under the Bankruptcy Act that address disputes between a trustee and the bankrupt.
It is apparent to the Court that the real issue between Hunt and Low is this beleaguered costs dispute. This bankruptcy costs dispute is not a matter for this Court. I have not seen any evidence that the costs sought have been quantified or certified as a debt owing. The amounts I have been provided with have been estimates only. There can be little advanced by the appointment of an independent administrator, other than to embroil the estate in an irrelevant costs dispute, for the purpose of securing control of an asset from which to pay those costs.
Upon resolution of the quantum of disputed costs, fees and charges owing in the bankruptcy, whether by agreement or by an appropriate adjudication of the rights and liabilities of the parties, Low would have a crystallised debt owing by Hunt which could be enforced in the Federal Court. Until that time, and in the absence of any remaining third party creditors of the bankrupt estate, it is inappropriate to appoint an independent administrator. The interest of the deceased’s estate is not at risk by reason of any conflict of interest between the sole beneficiary and her trustee in bankruptcy, necessitating appointment of an independent person. In fact appointment of an independent administrator to the deceased’s estate will serve to further diminish a modest estate.
Finally I turn to Hunt’s failure to attend the judicial mediation and Low’s application for indemnity costs. I have not had regard to submissions directed to Judicial Registrar McCann and sent to my Chambers given the confidential nature of matters raised for discussion in mediation to be conducted by her. It is submitted that those documents go to evidence of a preparedness to settle the matter and it would not be appropriate to have regard to the nature of any offers or responses made in the context of the planned mediation.
I remain of the view that a mediated outcome ought be attempted given the escalating costs. It is unfortunate that Hunt did not attend mediation on 17 December 2024 as she had agreed in accordance with the orders of the Court.
Low seeks her costs associated with attending the mediation on an indemnity basis. Hunt’s explanation for her failure to attend identifies two matters: her health and the inability to arrange legal representation. However, she was informed of the necessity to attend or provide medical evidence of an inability to do so. The failure put both the Court and Low to inconvenience and expense. It is appropriate that Hunt pay Low’s costs thrown away in relation to the mediation. I’m not persuaded that such costs should be assessed on an indemnity basis. I will consider the reasonableness of the parties claimed costs at such time upon submissions. So far as is possible I propose fixing costs.
I will dismiss Low’s application. Ordinarily costs would follow the event. I will invite Hunt to file submissions as to any legal costs she seeks be paid noting that Hunt was represented in this proceeding between 1 March 2024 and 21 June 2024, together with any disbursements, and I will invite Low to file submissions and details as to costs thrown away in relation to the mediation on the standard basis and not inclusive of any travel costs of Low in attending the mediation noting that my orders permitted the parties to attend remotely if legally represented. Otherwise, the order I propose is that Low’s application for removal of Hunt as administrator and trustee of the deceased estate of Phillip Flinn is dismissed.

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6 March 2025