Maas v O'Neill

[2013] WASC 379

DEBRA LORRAINE MAAS as Next Friend of MATTHEW JAMES MAAS -v- HELEN MARY O'NEILL in her capacity as the Executrix of the estate of the late MICHAEL O'NEILL [2013] WASC 379

Jurisdiction:	SUPREME COURT OF WESTERN AUSTRALIA	Citation No:	[2013] WASC 379
Case No:	CIV:2038/2010	Heard:	8 OCTOBER 2013
Coram:	PRITCHARD J	Delivered:	15/10/13
No of pages:	16	Judgment Part:	1 of 1
Result:	Agreement to settle the proceedings is approved
Category:	B
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Parties:	DEBRA LORRAINE MAAS as Next Friend of MATTHEW JAMES MAAS HELEN MARY O'NEILL in her capacity as the Executrix of the estate of the late MICHAEL O'NEILL HELEN MARY O'NEILL
Catchwords:	Application for approval of an agreement pursuant to O 70 r 10 of the Rules of the Supreme Court 1971 (WA) Person under a disability Whether the terms of the proposed agreement are for the benefit of the person under a disability
Legislation:	Family Provisions Act 1972 (WA) Rules of the Supreme Court 1971 (WA) Social Security Act 1991 (Cth)
Case References:	Barns v Barns [2003] HCA 9; (2003) 214 CLR 169 Bondelmonte v Blanckensee [1989] WAR 305 Butcher v Craig [2010] WASCA 92 Chappell v Hewson by his next friend Hewson [2013] WASCA 15 Coates v National Trustees Executors and Agency [1956] HCA 23; (1956) 95 CLR 494 Devereaux-Warnes v Hall (No 3) [2007] WASCA 235; (2007) 35 WAR 127 Dion Giuseppe Sergi by his next friend Aileen Solowiej v Sergi [2012] WASC 18 Dun v Dun [1957] HCA 91; (1957) 99 CLR 325 Goodman v Windeyer [1980] HCA 31; (1980) 144 CLR 490 Kitson v Franks [2001] WASCA 134 Kowal v Natalia Roxana Langlands as Executor of the State of Wlodymyr Kowal [2008] WASC 27 McCosker v McCosker [1957] HCA 82; (1957) 97 CLR 566 Oswell v Jones [2007] QSC 384 Pogorelic v Banovich [2007] WASC 45 Pontifical Society for Propagation of Faith v Scales [1962] HCA 19; (1962) 107 CLR 9 Robert Mitford Rowell by his next friend Angela Joan Rowell v Calder [2007] WASC 144 Scaffidi v Perpetual Trustees Victoria Ltd [2011] WASCA 159 Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201 Sosa v Carter [1978] WAR 123 Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191 Wade v State of Victoria (No. 2) [2012] FCA 1080 Wood v Public Trustee (WA) (1995) 16 WAR 58

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA CITATION : DEBRA LORRAINE MAAS as Next Friend of MATTHEW JAMES MAAS -v- HELEN MARY O'NEILL in her capacity as the Executrix of the estate of the late MICHAEL O'NEILL [2013] WASC 379 CORAM : PRITCHARD J HEARD : 8 OCTOBER 2013 DELIVERED : 15 OCTOBER 2013 FILE NO/S : CIV 2038 of 2010 BETWEEN : DEBRA LORRAINE MAAS as Next Friend of MATTHEW JAMES MAAS

Plaintiff

AND

HELEN MARY O'NEILL in her capacity as the Executrix of the estate of the late MICHAEL O'NEILL
First Defendant

AND

HELEN MARY O'NEILL
Second Defendant

Catchwords:

Application for approval of an agreement pursuant to O 70 r 10 of the Rules of the Supreme Court 1971 (WA) - Person under a disability - Whether the terms of the proposed agreement are for the benefit of the person under a disability

Legislation:

Family Provisions Act 1972 (WA)

Rules of the Supreme Court 1971 (WA)
Social Security Act 1991 (Cth)

Result:

Agreement to settle the proceedings is approved

Category: B

Representation:

Counsel:

Plaintiff : Mr G A Rabe
First Defendant : No appearance
Second Defendant : Ms J McKenzie

Solicitors:

Plaintiff : Stables Scott
First Defendant : No appearance
Second Defendant : MDS Legal

Case(s) referred to in judgment(s):

Barns v Barns [2003] HCA 9; (2003) 214 CLR 169
Bondelmonte v Blanckensee [1989] WAR 305
Butcher v Craig [2010] WASCA 92
Chappell v Hewson by his next friend Hewson [2013] WASCA 15
Coates v National Trustees Executors and Agency [1956] HCA 23; (1956) 95 CLR 494
Devereaux-Warnes v Hall (No 3) [2007] WASCA 235; (2007) 35 WAR 127
Dion Giuseppe Sergi by his next friend Aileen Solowiej v Sergi [2012] WASC 18
Dun v Dun [1957] HCA 91; (1957) 99 CLR 325
Goodman v Windeyer [1980] HCA 31; (1980) 144 CLR 490
Kitson v Franks [2001] WASCA 134
Kowal v Natalia Roxana Langlands as Executor of the State of Wlodymyr Kowal [2008] WASC 27
McCosker v McCosker [1957] HCA 82; (1957) 97 CLR 566
Oswell v Jones [2007] QSC 384
Pogorelic v Banovich [2007] WASC 45
Pontifical Society for Propagation of Faith v Scales [1962] HCA 19; (1962) 107 CLR 9
Robert Mitford Rowell by his next friend Angela Joan Rowell v Calder [2007] WASC 144
Scaffidi v Perpetual Trustees Victoria Ltd [2011] WASCA 159
Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201
Sosa v Carter [1978] WAR 123
Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191
Wade v State of Victoria (No. 2) [2012] FCA 1080
Wood v Public Trustee (WA) (1995) 16 WAR 58



1 PRITCHARD J: Mr Michael O'Neill died on 30 October 2009. At the time of his death, he was married to Mrs Helen O'Neill, and had a son, Matthew Maas, from an earlier relationship with Ms Deborah Maas. He had no other children.

2 Matthew was 12 years old at the time of his father's death. He is profoundly and permanently disabled. There is no dispute between the parties in relation to the nature and extent of Matthew's disabilities, which encompass a significant intellectual disability, and physical disabilities which mean he is wheelchair-bound. There is also no dispute that he is totally dependent on others to provide him with care and support in all aspects of his daily life. Matthew will require this level of care for the rest of his life, and he is expected to have an average life span. Matthew's care is presently provided by Ms Maas, and his stepfather Mr Ronald Maas.

3 Mr O'Neill made a will in which he gave $100,000 to his trustee for the benefit, maintenance and education of Matthew (cl 2). This sum was to be paid in instalments of $5000 per year until Matthew reached 16 years of age, with the balance thereafter to be paid to Matthew in a lump sum. In addition, Mr O'Neill made a number of specific and small gifts totalling $60,000 to his siblings and to a niece and nephew (the gifts). Mr O'Neill left the residue of his estate after the payment of all debts to Mrs O'Neill. That residue comprised a number of lots of farming land, and the land on which Mr and Mrs O'Neill's home was located (the home block). Mrs O'Neill was also appointed the executor and trustee of Mr O'Neill's will.

4 In 2010, probate was granted to Mrs O'Neill as the executrix of Mr O'Neill's will and at that time, the estate had net assets valued at over $3 million. The gifts have been paid, and the farming lots sold, apart from the home block. Due to a significant fall in the value of the farming lots since the grant of probate, the estate has a present gross value of just over $1.8 million.

5 Ms Maas commenced the present action (as Matthew's next friend) under the provisions of the Inheritance (Family and Dependents) Provision Act 1972 (WA) which is now called the Family Provisions 1972 (WA) Act (the Family Provisions Act). She sought an order that provision be made out of Mr O'Neill's estate for Matthew's proper maintenance, support, education and advancement in life. In 2012, Ms Maas also commenced proceedings to remove Mrs O'Neill as executrix and trustee (the related action).

6 After some protracted negotiations, the parties to the action have reached an agreement to settle the proceedings on terms set out in a settlement agreement (the proposed settlement). They have also agreed to orders to settle the related action. Because Matthew is a person under a disability, the proposed settlement requires the approval of the Court: O 70 r 10 of the Rules of the Supreme Court 1971 (RSC). Ms Maas now applies for the Court's approval of the proposed settlement.

7 I note that in her capacity as executrix Mrs O'Neill was not represented at the hearing of the application to approve the proposed settlement. Her solicitors advised the Court that the executrix would abide the Court's decision. However, in her personal capacity, Mrs O'Neill was represented at the hearing.

8 For the reasons set out below, I have concluded that approval should be given to the proposed settlement.

9 In these reasons for decision, I deal with four matters:

1. Requirements for the exercise of the Court's jurisdiction to approve a settlement of proceedings involving a person under a disability;

2. Principles governing applications under the Family Provisions Act;

3. The orders sought;

4. Why the orders sought should be made.

1. Requirements for the exercise of the Court's jurisdiction to approve a settlement of proceedings involving a person under a disability

10 Order 70 r 10(1) of the RSC provides that no settlement or compromise made in any cause or matter in which there is a claim by or on behalf of or against a person under a disability shall be valid unless it is approved by the Court. The application for approval must be supported by an affidavit and the opinion of an independent counsel.1

11 Ms Maas' application was supported by two affidavits: an affidavit of Antony John Goldfinch sworn 5 September 2013 and an affidavit of Debra Lorraine Maas sworn 5 September 2013. Mr Goldfinch's affidavit annexed a large number of documents which contained the evidence which would have been adduced at trial in relation to the matters in issue in an application under the Family Provisions Act, together with a copy of the probate granted in respect of Mr O'Neill's will, and a copy of the proposed settlement agreement reached by the parties.

12 Ms Maas' affidavit annexed a copy of the proposed settlement agreement into which she has entered, in her capacity as Matthew's next friend, and a copy of the opinion prepared by Mr Rabe of counsel in support of the application for approval of the proposed settlement.

13 The Court has an inherent power to approve an agreement to compromise an action brought on behalf of a person under a disability if it is satisfied that it is for the benefit of the person to do so. Order 70 r 10 merely provides a framework for the Court to exercise its power.2 The Court must consider the proposed compromise from the perspective of the person under the disability, and determine, from that perspective, whether the terms of the compromise are fair and whether the compromise is for that person's benefit.3 The role of the Court is not to hear the application as if it were the substantive hearing and then to give or withhold its approval by comparing the offer with the judgment which it would have given.4

14 The role of the Court in considering an application under O 70 r 10 and the factors to be considered in doing so were recently discussed by his Honour EM Heenan J in Dion Giuseppe Sergi by his next friend Aileen Solowiej v Sergi5 at [37] - [42]. It is unnecessary to repeat his Honour's discussion of the principles here, but I gratefully rely upon his Honour's discussion.

15 In summary, in order for the proposed settlement to be approved in this case, the Court must satisfy itself that:

(i) the proposed settlement will be for Matthew's benefit;

(ii) all the facts relevant to his claim have been brought together and considered by his legal advisers;

(iii) the proposed settlement is supported by the opinion of an independent counsel who has given proper consideration to all aspects of the case, and

(iv) the independent counsel's opinion has been considered, understood and approved by Matthew's next friend, Ms Maas.

2. Principles governing applications under the Family Provisions Act

16 In order to decide whether the proposed settlement will be for Matthew's benefit, and that all relevant facts have been considered, it is necessary to bear in mind the principles governing applications under the Family Provisions Act. Ms Maas' application under that Act is brought pursuant to s 6(1) which permits an application to be made by certain persons (including, relevantly, a child of the deceased living at the date of his or her death) on the basis that the disposition of the deceased's estate effected by their will was not such as to make adequate provision from the estate for the applicant's proper maintenance, support, education or advancement in life. If the provision is inadequate, the Court has the discretion to make 'such provision as the Court thinks fit out of the estate for that purpose'. It is well established that s 6 thus encompasses a two stage process.6

17 The question whether adequate provision was made for an applicant's proper maintenance, support, education or advancement in life involves, in effect, a jurisdictional question.7 In determining that question, it is necessary to consider an applicant's financial position, and his or her need for, and moral claim to, provision from the estate, the need and moral claims of other persons who have a legitimate claim upon the testator's bounty, and the size of the estate, as at the date of the testator's death.8 The terms 'maintenance', 'support' and 'advancement' in s 6(1) of the Family Provisions Act encompass not only provision for the supply of the necessaries of life, but also extend to provision over and above a mere sufficiency of means upon which to live,9 and may extend to provision which would enable a potential beneficiary to improve his or her prospects in life.10

18 In exercising the discretion under s 6(1) of the Family Provisions Act, the question for the Court is what award would be adequate for the 'proper' maintenance, support, education or advancement of the applicant. The term 'proper' prescribes a standard, whereas the term 'adequate' is concerned with the quantum of the award. The propriety of a provision for an applicant is to be assessed by reference to all the circumstances.11 Determining the quantum of an award which would be adequate for the proper maintenance, support, education and advancement of an applicant is also a relative question, which requires consideration of the nature, extent and character of the estate and the other demands upon it.12 The exercise of discretion involves a consideration of the facts which exist at the time of the making of the order.13

19 Section 6 of the Family Provisions Act confers a wide discretion on the Court at each stage of the two stage analysis.14

20 Having regard to Matthew's circumstances, which were known to Mr O'Neill prior to his death, there is no room for any doubt that Mr O'Neill did not make adequate provision in his will for Matthew's proper maintenance, support, education or advancement in life. There is also no doubt that as Mr O'Neill's wife, Mrs O'Neill also has a strong claim to Mr O'Neill's bounty. The question at trial would have been precisely how much more of Mr O'Neill's estate, over the $100,000, should have been directed to Matthew. In this respect, I bear in mind that the capacity of a court to make 'adequate' provision for the 'proper' maintenance, support and advancement of an applicant may be constrained by practical considerations such as the size and nature of the deceased's estate, and competition from other persons having competing claims upon the deceased's bounty, and their relative urgency.15

3. The orders sought to be made by the Court

21 Under the proposed settlement, adequate provision for the proper maintenance and support of Matthew is to be made by reading and construing Mr O'Neill's will as though cl 2 was deleted and various additional clauses inserted in lieu thereof. Those additional clauses achieve five things.

22 First, the sum of $550,000 is to be held on trust by two persons (whom Mr Rabe advised were accountants) to be applied, with the consent of Matthew's guardians, for the purpose of purchasing a home (or in due course a substitute home) for Matthew as his principal place of residence for as long as he or his guardians wish. The sum allocated may also be used for making any modifications which may be required to the home to accommodate Matthew's needs. Alternatively, the trustees are permitted to apply the fund to the payment of a deposit, bond or lease payments for Matthew in residential accommodation, even though this may result in a decrease in the capital value of the fund as the primary object of the trust is to provide a substantial residence for Matthew for as long as he wishes, which is expected to be for the rest of his life. When Matthew ceases to permanently live in any of these forms of residential accommodation, the residence, or the capital of the fund which has been invested is to be held by Mrs O'Neill, as part of the residue of the estate, or if Mrs O'Neill has died, by any beneficiary of Matthew's under the laws of intestacy.

23 Secondly, the sum of $594,000 is to be held by the trustee on trust to create a trust fund that qualifies as a special disability trust within the meaning of s 1209L of the Social Security Act 1991 (Cth), for the primary benefit of Matthew. The trustees for that trust are to be the same accountants appointed to deal with Matthew's residential accommodation. Income from this trust will be able to be used to meet Matthew's needs. At the end of this trust, any contribution balance is to be distributed in equal proportions to Matthew or his personal representatives, and to the executor of Mr O'Neill's estate as part of the residue of the estate.

24 Thirdly, there is to be a gift to Matthew of $22,000. This represents the remaining balance of the original $100,000 left for Matthew under cl 2, taking into account other payments Matthew has received.

25 Fourthly, the home block is to be given to Mrs O'Neill absolutely. She will also retain an entitlement to the residue of the estate, but in the immediate future, once the liabilities of the estate are paid, there is unlikely to be any residue.

26 The immediate residue of the estate - just under $300,000 - will be available to pay the liabilities of the estate. These will include a tax bill, the quantum of which is not yet known. In addition, the proposed settlement contemplates that the taxed costs of all parties to the proceedings (and in the related action) are to be paid from the estate, but should the funds in the estate be insufficient to meet those costs, then all disbursements should be paid, and the balance of the taxed costs are then to be proportionally capped between the parties so as not to exceed the remaining funds in the estate.

27 For completeness, I note that the proposed settlement seeks, in effect, to vary the will. The discretion in applications under s 6(1) of the Family Provisions Act is sometimes exercised in that manner.16 There may be a question as to whether the Court's power in s 6(1) to order that provision for an applicant be made out of an estate extends to the power to order that a will be read as though particular clauses were deleted and different clauses inserted. However, it is not necessary to consider that issue further in this case because even if an order were made for provision out of the estate for Matthew, before the balance of the will was given effect, the same result would be able to be achieved as is sought by the orders in this case.

4. Why the orders sought should be made

28 I turn, then, to the matters about which the Court must be satisfied before it may approve the proposed settlement. Having regard to the content of the affidavits relied upon in support of the application, to Mr Rabe's opinion, and to the submissions of counsel, I am satisfied that all the facts relevant to Matthew's claim under the Family Provisions Act have been brought together and considered by his legal advisers, and that the facts upon which Mr Rabe's opinion are based appear to be correct.

29 I am also satisfied that the proposed settlement is supported by the opinion of an independent counsel who has given proper consideration to all aspects of the case. I note that Mr Rabe, who provided an opinion in support of the proposed settlement, has been acting as counsel for Ms Maas in these proceedings. No objection issue was taken to the opinion on that basis. Mr Rabe submits that the requirement for an opinion by an independent counsel refers to an opinion prepared by a lawyer in furtherance of that lawyer's duty to assist the Court and not in furtherance of any duty the lawyer may have to a party in the proceeding. I accept that submission,17 and having regard to the content of Mr Rabe's opinion, I accept that it meets that description.

30 Even if I had reached a different view as to the requirement for the opinion to be provided by an 'independent counsel', I would have dispensed with that requirement in the circumstances of this case.18 Those circumstances are, first, that the material before the Court indicates (either expressly or by implication) that the next friend's counsel, and solicitor, are of the view that the proposed settlement will be beneficial to Matthew.19 Secondly, to require a counsel with no prior involvement in this matter to provide an opinion as to the proposed settlement would inevitably have substantially increased the costs in circumstances where, as I have noted, the value of the estate has already declined since the grant of probate, and where the needs of those with a claim on Mr O'Neill's bounty far exceed the value of his estate.

31 Having regard to the content of Ms Maas' affidavit, I am satisfied that Ms Maas, as Matthew's next friend, has read Mr Rabe's opinion, has discussed it with her solicitors, and has formed the view that the proposed settlement is beneficial to Matthew, and would be in his best interests.

32 Finally, I turn to the most important consideration, namely whether the proposed settlement will be for Matthew's benefit. I am satisfied that the proposed settlement will be for Matthew's benefit. In explaining that conclusion I deal with three matters:

(a) the quantum and structure of the proposed settlement;

(b) the capped legal costs;

(c) other benefits to Matthew as a result of the proposed settlement.

(a) The quantum and structure of the proposed settlement

33 The result of the proposed settlement is that of the remaining $1.857 million value of the estate, $1.157 million will now be directed to Matthew's benefit, in addition to the other smaller payments which he has previously received from the estate. (In total, Matthew will receive $1.166 million from the estate, taking into account the sums already paid to him.)

34 There are three matters pertaining to the quantum and structure of the proposed settlement about which I need to make mention. The first is the special disability trust component of the proposed settlement. As I have said above, the proposed settlement involves the establishment of two trusts - one for residential accommodation for Matthew, and the other in the form of a special disability trust. A summary of the requirements for, and benefits of, special disability trusts within the context of Commonwealth social security benefits was set out by Chesterman J in Oswell v Jones and Ors.20It is unnecessary to repeat his Honour's observations here, save to observe that the $594,000 which is to be held on trust as a special disability trust is just under the maximum value of assets (in addition to a beneficiary's principal residence) which at present may be held on trust without affecting the beneficiary's pension entitlements. Mr Rabe's opinion indicates that the compromise has been structured to enable Matthew to have access to his full pension benefits both at present and on attaining the age of 18 years.

35 In Bondelmonte v Blanckensee21the Full Court of this Court held that it was not a proper exercise of the discretion under s 6(1) of the Inheritance (Family and Dependents) Provision Act 1972 (WA) to structure the provision out of an estate for an applicant in such a way as to preserve his or her right to a pension or otherwise to assume its continuance. Three things may be said about that decision. First, the reason why the Full Court concluded that pension entitlements should not be taken into account was that welfare payments should not be viewed as relieving a testator of his moral obligation to provide for his family. In other words, a testator could not exclude a beneficiary from participation in his estate on the ground that he or she was in receipt of a pension.22 That is not this case. In the present case, the competing claims on the estate are beyond the capacity of the estate.23

36 In addition, even if the Court - in the exercise of its discretion to make provision - should not take into account a party's pension entitlement, that does not preclude the parties themselves, in reaching a settlement of any claim under the Family Provisions Act, from doing so in a way which is designed to maximise the income of a party as a result of a provision out of an estate combined with a continuation of a pension benefit.

37 Furthermore, adoption of the latter approach might affect whether the proposed settlement were to be regarded as for the benefit of a party under a disability if the approach meant that that party would receive significantly less than what that party might expect to receive by way of an order for provision from the estate following a trial. However, that is not this case. An analysis of various possible settlement options was set out in a report prepared by Mr Morris, a financial planner, which was annexed to Mr Goldfinch's affidavit. On Mr Morris' calculation, the proposed settlement will result in Matthew deriving an income - from the trust and from his pension entitlements - of just under $50,000 per annum. Mr Morris calculated the financial implications of a higher provision from the estate, but which did not utilise a special disability trust. In this regard, failure to comply with the requirements for a special disability trust would mean Matthew would lose his pension entitlements for many years. The consequence would be that in order for Matthew to receive a higher income, per year, than under the proposed settlement, he would need to receive a far greater sum from the estate. Given the value of the estate itself, and Mrs O'Neill's competing claim on the estate, it is far from apparent that that outcome could be secured for Matthew.

38 The second aspect of the quantum and structure of the proposed settlement that warrants mention is the fact that the amount to be held on trust for the provision of residential accommodation for Matthew is limited to $550,000. However, the evidence suggests that that figure will be adequate to purchase a modest house in regional Western Australia (where Matthew and Mr and Mrs Maas live, and wish to live), and to make appropriate variations to such a house to accommodate Matthew's needs.

39 As I have noted above, the proposed settlement includes a term to the effect that if Matthew at some stage ceases to permanently reside in the residential accommodation provided for him under the trust then the house, or any remaining capital, will pass to Mrs O'Neill if she is still alive. Although there may be other reasons why Matthew may be unable to reside in the residential accommodation able to be provided for him under the trust, the most likely scenario is that this clause will come into operation once Matthew passes away, particularly as the purpose of the trust is to provide Matthew with residential accommodation for the rest of his life. From that perspective, I do not consider that this clause detracts from the benefit to Matthew of the proposed settlement.

40 The third aspect of the quantum and structure of the proposed settlement which requires consideration is the question whether Matthew might realistically have expected to obtain more had the matter gone to trial, and thus whether the proposed settlement represents a benefit for him in that context. The evidence before the Court indicates that the cost of meeting Matthew's future needs for a home, for care, for equipment to assist with his physical disabilities, and for his future medical expenses is estimated to exceed $9 million, which far exceeds the value of the entire estate. (At present, Matthew and Mr and Ms Maas do their best to meet his needs using the disability and carers pensions they receive.)

41 However, Matthew is not the only person with a claim on Mr O'Neill's bounty. Mr Rabe points out in his opinion that as Mr O'Neill's widow, Mrs O'Neill has a legitimate competing claim for some provision out of the estate. This is particularly so given her circumstances - she is in her mid-50s and has a very limited income earning capacity. Although Mrs O'Neill owns an investment property, counsel advised that its value is not substantial, and the evidence before the Court suggests that Mrs O'Neill derives only a modest income from that property, which presently appears to represent her only source of income. At the same time, Mrs O'Neill has lived on the home block for the past ten years or so, it has a value of approximately $400,000 and it was clearly Mr O'Neill's wish to make a substantial provision for his wife from his estate, a consideration which would also be of relevance at trial. As Mr Rabe points out, any greater award to Matthew at trial would require that Mrs O'Neill leave her home, so that the Home Block could be sold. There is a risk that if the matter were to proceed to trial, that outcome may be regarded as harsh in all of the circumstances.

42 Mr Rabe's opinion is that the proposed settlement achieves a result for Matthew which would not be unlikely if the matter were to proceed to trial, and outweighs the risks of proceeding to trial, particularly with the significant legal costs that that would entail. In addition to the legal costs which would result from a trial (which would likely take some days given the number of experts who would need to be called to give evidence) there would be additional disbursements in obtaining expert reports and arranging for the attendance of experts at the trial.

43 In taking into account Mr Rabe's opinion, I have borne in mind the observations by Le Miere J in Kowal v Natalia Roxana Langlands as Executor of the State of Wlodymyr Kowal,24which are apt in this case. His Honour said:

The court must itself consider the opinion given and the reasons for it. If having done that it appears that all aspects of the case have received proper consideration the court should be slow to disagree with the opinion particularly upon such a matter as an Inheritance Act application. The court should be aware of the risks of litigation in an area in which reasonable people can reasonably reach different conclusions and hence slow to force the person under disability to take a risk which the court is unable to underwrite.

44 Taking all of these considerations into account, I accept that the quantum and structure of the proposed settlement is such that the settlement is for Matthew's benefit.

(b) The capped legal costs

45 In concluding that the proposed settlement will be for Matthew's benefit, I have also taken into account the manner in which legal costs are dealt with in the proposed settlement. After the provision for Matthew and Mrs O'Neill arising from the proposed settlement, there will be less than $300,000 remaining in the estate to cover its outstanding liabilities. Under the proposed settlement the taxed costs and disbursements of all parties to this, and the related action, are to be paid out of the estate, subject to the capping provision to which I have already referred. In his opinion, Mr Rabe noted that the legal fees and disbursements of the firms acting for the parties already exceeded the amount which remains, with the result that those costs (apart from the disbursements) will have to be proportionally capped. I am satisfied that the costs paid to Matthew's solicitors under this arrangement will not exceed their proper costs.

(c) Other benefits to Matthew as a result of the proposed settlement

46 Quite apart from the significant additional costs of proceeding to trial, doing so would involve a further delay in the resolution of the proceedings, when those proceedings have been on foot for several years. Accordingly, the third reason why I have concluded that the proposed settlement is for Matthew's benefit is that it will mean that his trustees will be able to immediately move to obtain accommodation and an income stream, which will significantly assist in meeting Matthew's needs. Given the nature of Matthew's disabilities, and needs, that benefit in itself is not an insignificant consideration.

Conclusion

47 Pursuant to O 70 r 10 of the RSC, I approve the proposed settlement. I will make orders consistent with the proposed settlement after giving counsel the opportunity to be heard in relation to the terms of those orders.

______________________________________

1Rules of the Supreme Court1971 (WA) O 70 r 10(2).
2Scaffidi v Perpetual Trustees Victoria Ltd[2011] WASCA 159 [50] (the Court); Wood v Public Trustee (WA)(1995) 16 WAR 58, 62 (Pidgeon J), 65 (Rowland J & Franklyn J agreeing).
3Robert Mitford Rowell by his next friend Angela Joan Rowell v Calder [2007] WASC 144 [5] (Martin CJ).
4Sosa v Carter[1978] WAR 123, 124 (Burt CJ, Wallace J & Brinsden J agreeing).
5Dion Giuseppe Sergi by his next friend Aileen Solowiej v Sergi[2012] WASC 18.
6Chappell v Hewson by his next friend Hewson[2013] WASCA 15 [13] (the Court); Bondelmonte v Blanckensee[1989] WAR 305, 305 (Malcolm CJ); Vigolo v Bostin[2005] HCA 11; (2005) 221 CLR 191, 212 - 213 (Gummow & Hayne JJ); Singer v Berghouse[1994] HCA 40; (1994) 181 CLR 201, 208 - 209 (Mason CJ, Deane & McHugh JJ).
7Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201, 208 - 209 (Mason CJ, Deane & McHugh JJ); Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191, 228 (Gummow & Hayne JJ); and Bondelmonte v Blanckensee [1989] WAR 305, 307 (Malcolm CJ).
8Butcher v Craig [2010] WASCA 92 [12] (the Court); Devereaux-Warnes v Hall (No 3) [2007] WASCA 235; (2007) 35 WAR 127, 131 (McLure JA); see also Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201, 210 (Mason CJ, Deane & McHugh JJ); Kitson v Franks [2001] WASCA 134 [35] (Parker J), [10] (Malcolm CJ agreeing), [20] (Kennedy J agreeing).
9Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191 [115] (Callinan & Heydon JJ), cf Kitson v Franks [2001] WASCA 134, [44] (Parker J).
10Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191 [115] (Callinan & Heydon JJ).
11Devereaux-Warnes v Hall (No 3) [2007] WASCA 235; (2007) 35 WAR 127, 152 (Buss JA); Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201, 211 (Mason CJ, Deane & McHugh JJ), (227) (Gaudron J); Bondelmonte v Blanckensee [1989] WAR 305, 308 (Malcolm CJ).
12Pontifical Society for Propagation of Faithv Scales [1962] HCA 19; (1962) 107 CLR 9, 19 (Dixon CJ).
13Coates v National Trustees Executors and Agency[1956] HCA 23; (1956) 95 CLR 494, 505 - 507 (Lowe J);Dun v Dun [1957] HCA 91; (1957) 99 CLR 325, 331 (Dixon CJ, Kitto & Taylor JJ); Goodman v Windeyer [1980] HCA 31; (1980) 144 CLR 490, 499 (Gibbs J); Bondelmonte v Blackensee [1989] WAR 305, 307 (Malcolm CJ).
14Chappell v Hewson by his next friend Hewson[2013] WASCA 15 [26] - [27].
15Devereaux-Warnes v Hall (No 3) [2007] WASCA 235; (2007) 35 WAR 127, 146 (Buss JA) citing McCosker v McCosker [1957] HCA 82; (1957) 97 CLR 566, 571 - 572 (Dixon CJ & Williams J); Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201 (Gaudron J); Barns v Barns [2003] HCA 9; (2003) 214 CLR 169 [4] (Gleeson CJ).

16 See the discussion in Dion Giuseppi Sergi by Next Friend Aileen Solowiej v Sergi[2012] WASC 18 [53] - [54] (EM Heenan J).
17Sosa v Carter[1978] WAR 123, 124 (Burt CJ, Wallace J & Brinsden J agreeing); cf Wade v State of Victoria (No. 2) [2012] FCA 1080 [6] - [9] (Bromberg J).
18Rules of the Supreme Court 1971 (WA) O 70 r 10 (2)(b).
19 Cf Consolidated Practice Direction 4.2.2.
20Oswell v Jones[2007] QSC 384 [53] - [55].
21Bondelmonte v Blanckensee [1989] WAR 305, 312 (Malcolm CJ), 318 - 319 (Wallace J) and 320 - 321 (Nicholson J).
22 See Bondelmonte v Blanckensee[1989] WAR 305, 318 - 319 (Wallace J).
23 Cf Pogorelic v Banovich[2007] WASC 45 [74] (Master Newnes).
24Kowal v Natalia Roxana Langlands as Executor of the State of Wlodymyr Kowal[2008] WASC 27 [10].