Macgregor v Macgregor
[2003] WASC 169
MACGREGOR & ANOR -v- MERVYN STANLEY MACGREGOR as Executor of the estate of JANET EDNA MACGREGOR & ANOR [2003] WASC 169
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2003] WASC 169 | |
| Case No: | CIV:2528/2000 | 29 JANUARY 2003, 22 AUGUST 2003 | |
| Coram: | TEMPLEMAN J | 28/08/03 | |
| 40 | Judgment Part: | 1 of 1 | |
| Result: | Each plaintiff awarded one-sixth of estate Defendant awarded two-thirds of estate | ||
| B | |||
| PDF Version |
| Parties: | JEANETTE DAWN MACGREGOR DALYS WENDY GILLETT MERVYN STANLEY MACGREGOR as Executor of the estate of JANET EDNA MACGREGOR MERVYN STANLEY MACGREGOR |
Catchwords: | Family provision Adult children of testatrix Plaintiffs "struggling" No disentitling conduct Defendant dependent on social security and testatrix Modest estate consisting of family home in which defendant resided Whether wise and just testator would adequately provide for maintenance and support of plaintiffs and defendant by devising house to defendant |
Legislation: | Inheritance (Family and Dependants Provision) Act 1972, s 6, s 9, s 15, s 16 Property Law Act 1969, s 34(1)(a) |
Case References: | Barns v Barns [2003] HCA 9 Hughes v National Trustees, Executors and Agency Company of Australasia Ltd (1979) 143 CLR 135 In re Green, deceased; Zuckerman v Public Trustee [1951] NZLR 135 Maddison v Alderson (1883) 8 App Cas 467 Ogilvie v Ryan [1976] 2 NSWLR 504 Permanent Trustee Co Ltd v Fraser (1995) 36 NSWLR 24 Scenini v Public Trustee & Ors, unreported; SCt of WA (White J); Library No 940058; 11 February 1994 Schaefer v Schuhmann [1972] AC 572 Singer v Berghouse (1994) 181 CLR 201 Stott v Cook (1960) 33 ALJR 447 Vigolo v Wanda Mary Boston [2002] WASCA 327 White v Barron (1979) 144 CLR 431 Horton v Jones (1935) 53 CLR 475 Trifid Pty Ltd v Ratto [1985] WAR 19 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- DALYS WENDY GILLETT
Plaintiffs
AND
MERVYN STANLEY MACGREGOR as Executor of the estate of JANET EDNA MACGREGOR
First Defendant
MERVYN STANLEY MACGREGOR
Second Defendant
Catchwords:
Family provision - Adult children of testatrix - Plaintiffs "struggling" - No disentitling conduct - Defendant dependent on social security and testatrix - Modest estate consisting of family home in which defendant resided - Whether wise and just testator would adequately provide for maintenance and support of plaintiffs and defendant by devising house to defendant
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Legislation:
Inheritance (Family and Dependants Provision) Act 1972, s 6, s 9, s 15, s 16
Property Law Act 1969, s 34(1)(a)
Result:
Each plaintiff awarded one-sixth of estate
Defendant awarded two-thirds of estate
Category: B
Representation:
Counsel:
Plaintiffs : Mr T Darbyshire
First Defendant : In person
Second Defendant : In person
Solicitors:
Plaintiffs : Kott Gunning
First Defendant : In person
Second Defendant : In person
Case(s) referred to in judgment(s):
Barns v Barns [2003] HCA 9
Hughes v National Trustees, Executors and Agency Company of Australasia Ltd (1979) 143 CLR 135
In re Green, deceased; Zuckerman v Public Trustee [1951] NZLR 135
Maddison v Alderson (1883) 8 App Cas 467
Ogilvie v Ryan [1976] 2 NSWLR 504
Permanent Trustee Co Ltd v Fraser (1995) 36 NSWLR 24
Scenini v Public Trustee & Ors, unreported; SCt of WA (White J); Library No 940058; 11 February 1994
Schaefer v Schuhmann [1972] AC 572
Singer v Berghouse (1994) 181 CLR 201
Stott v Cook (1960) 33 ALJR 447
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Vigolo v Wanda Mary Boston [2002] WASCA 327
White v Barron (1979) 144 CLR 431
Case(s) also cited:
Horton v Jones (1935) 53 CLR 475
Trifid Pty Ltd v Ratto [1985] WAR 19
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1 TEMPLEMAN J: The plaintiffs in this application are Jeanette Dawn MacGregor and Dalys Wendy Gillett. They are sisters, aged 66 and 55 years respectively. They are both married, with adult children. The defendant, Mervyn Stanley Macgregor is the plaintiffs' brother. He is aged 59 years and has never married. The plaintiffs appeared by counsel at the hearing. The defendant represented himself.
2 The plaintiffs claim that the disposition of the estate of their late mother, Mrs Janet Edna Macgregor, effected by her will, is not such as to make adequate provision for the proper maintenance, support, education or advancement in life of either of them. In fact, the will made no provision for them. The whole of the testatrix's net estate (essentially, her house and it contents) passed to the defendant, with whom she had shared the house for over 30 years. The defendant is joined in two capacities: as executor and sole beneficiary of the estate.
3 The plaintiffs have applied for provision to be made for them out of their mother's estate, as the Court deems just. The application is made pursuant to s 6 of the Inheritance (Family and Dependants Provision) Act 1972 ("the Inheritance Act").
4 It will be convenient to refer to the testatrix as "Mrs Macgregor" and to the parties and other family members by their Christian names. I intend no disrespect by referring to them in this way.
The law relating to this application
5 Section 6 of the Inheritance Act provides, so far as relevant that:
"6. (1) If any person (in this Act called 'the deceased') dies, then, if the Court is of the opinion that the disposition of the deceased's estate effected by his will, … is not such as to make adequate provision from his estate for the proper maintenance, support, education or advancement in life of any of the persons mentioned in section 7 of this Act as being persons by whom or on whose behalf application may be made under this Act, the Court may, at its discretion, on application made by or on behalf of any such person, order that such provision as the Court thinks fit is made out of the estate of the deceased for that purpose.
…
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- (3) The Court may attach such conditions to the order as it thinks fit, or may refuse to make an order in favour of any person on the ground that his character or conduct is such as in the opinion of the Court to disentitle him to the benefit of an order, or on any other ground which the Court thinks sufficient.
(4) In making any such order the Court may, if it thinks fit, order that the provision may consist of a lump sum or a periodical or other payment."
6 It is well established that this section raises two questions. The first is whether "adequate provision" has been made for the applicant(s) out of the relevant estate. If, and only if, the answer to that question is "no", the Court goes on to consider the second question: whether, and if so, what, provision should be made.
7 In this case, because of the respective ages of Jeanette and Dalys, it is not appropriate to consider their education or advancement in life: I am concerned only with maintenance and support.
8 InSinger v Berghouse (1994) 181 CLR 201 at 210 the High Court said that in answering the first question, it is necessary to take into account, as at the date of the deceased's death:
" … the proper level of maintenance etc. appropriate for the applicant having regard, amongst other things, to the applicant's financial position, the size and nature of the deceased's estate, the totality of the relationship between the applicant and the deceased and the relationship between the deceased and other persons who have legitimate claims upon his or her bounty."
9 In order to decide what the "proper level of maintenance etc" should be:
"A trial judge has to place himself in the position of the testator and to consider what the testator 'ought to have done in all the circumstances of the case': Bosch v Perpetual Trustee Co Ltd [1938] AC 463 at p 478. No doubt this requires him to recognise and to apply prevailing community standards of what is right and appropriate since it is by those standards that the content both of the moral duty owed by a just husband and father to his wife and children and of departures from it will be measured: In re Allardice … [1911] AC 730 at pp 734-5."
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10 White v Barron (1979) 144 CLR 431, 440 per Stephen J.
11 Three things may be said about that approach. First, it applies, of course, equally to a mother, as to a father. Secondly, when the judge places himself in the position of the testator, he or she is to regard the testator as "wise and just", rather than "fond and foolish": Bosch v Perpetual Trustee Co (supra) at p 478-9.
12 The third point is that the Inheritance Act does not expressly refer to or identify any "moral duty".
13 However, s 9 of the Act requires the Court to have regard to certain provisions of the Trustees Act 1962 in determining whether and in what way provision "ought" to be made. As Sheppard AuJ pointed out in Vigolo v Wanda Mary Boston [2002] WASCA 327, at [91]:
" … the presence of the word 'ought' in the section shows that the legislation is drafted on the assumption that it intended that Courts exercising jurisdiction under s 6 of the (Inheritance) Act would address the question of what order 'ought' to be made."
- Sheppard AuJ, with whom Steytler and Parker JJ agreed, adopted the approach taken in Permanent Trustee Co Ltd v Fraser (1995) 36 NSWLR 24 by Sheller JA who held:
"In deciding whether the provision for an eligible person is inadequate for that person's proper maintenance, education or advancement in life the Court should be guided by consideration of the provision which, in accordance with prevailing community standards of what is right and appropriate and in the circumstances mentioned in the Family Provision Act and then obtaining, ought to be made in favour of the eligible person … I do not think this approach produces any different result from that reached by reference to the concept of moral obligation or duty as that expression had generally been understood or used by the Courts. However, it avoids doctrinal and inflexible judge made rules and fulfils the Court's function … of speaking for the feeling and judgment of fair and reasonable members of the community."
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- Inheritance Act is an example, as identifying certain classes of person "who might have a moral claim upon the bounty of a deceased".
15 Drawing these strands together, it is necessary for me to consider whether, in all the circumstances, including the size and nature of her estate, her relationship with Jeanette, Dalys and Mervyn, and their respective financial positions, Mrs Macgregor, as a wise and just testatrix, viewing the situation as at the date of her death, owed a moral duty to Jeanette and Dalys to make some provision for them out of her estate. In answering that question, I must have regard to prevailing community standards of what is right and appropriate.
16 If I am satisfied that Mrs Macgregor's will did not make adequate provision for Jeanette and Dalys, I must then go on to decide the nature and extent of the provision which ought to have been made, again assuming Mrs Macgregor to have been a wise and just testatrix.
17 In order to consider these questions, it is necessary first to have regard to the detailed provisions of Mrs Macgregor's will, and the composition of her estate.
Mrs Macgregor's will
18 Mrs Macgregor died on 15 August 1999, a few weeks after her 83rd birthday. She made her will on 4 December 1989. She wrote the will in her own hand, apparently without having legal advice, although it seems that she used some kind of precedent.
19 I should make it clear at once that I am not concerned with the circumstances in which Mrs Macgregor made her will. It was duly admitted to Probate and therefore stands as a valid will, made by a person of sound mind who freely expressed her testamentary wishes.
20 By cl 1 of the will, Mrs Macgregor revoked all previous wills. By cl 2, she appointed Mervyn and a mutual friend, Richard William Stoker, to be her executors. Then, after making provision in cl 3 for the payment of debts and funeral expenses, Mrs Macgregor continued in cl 4:
"I give Devise and Bequeath:
My land, house & contents at 7 Congdon St. Claremont 6010, and such Motor car that I have at my death to my son Mervyn Stanley Macgregor.
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- After all death duties, debts and funeral expences (sic) have been paid, all monies all monies (sic) left from Insurances, Building Societies and banks to be given to my son Mervyn Stanley Macgregor, 7 Congdon Street, Claremont."
21 The Congdon Street property, which is now within the boundaries of the Town of Cottesloe, is the only asset of any consequence in Mrs Macgregor's estate. I shall refer to it as "the house".
22 There is no independent expert evidence as to the value of the house when Mrs Macgregor died. Mervyn assessed its value at $455,000, by making his own enquiries and having regard to sales of what he believed to be comparable properties. His value has been accepted by Jeanette and Dalys.
23 Mervyn valued the contents of the house at $1,800 and Mrs Macgregor's car – a 1973 Holden sedan – at $550.
24 The only other asset was cash, principally in a bank account, amounting to $2,564.
Mrs Macgregor's reasons
25 The reason for Mrs Macgregor making Mervyn her sole heir, is I think, clear. She told Dalys' mother-in-law, Joyce Beatrice Gillett, when they were sitting together at the wedding of their granddaughter Natalie, that she was leaving the house to Mervyn "because she had helped the others out over the years already and she felt that Mervyn deserved the security of his house for the future". It is not clear when that conversation took place.
26 Affidavit evidence to a similar effect was given by Carol Saastamoinen, who was Dalys' sister-in-law until her husband's death in 1983.
27 Mrs Saastamoinen was a friend of Dalys, over many years. She said she and her husband, and Dalys and her husband were in business together from 1972 to 1981. However, I prefer Dalys' evidence that their husbands only worked together.
28 Mrs Saastamoinen said Dalys had told her on several occasions over the years, that the house would be left to Mervyn; that Mrs Macgregor had helped Jeanette and her husband financially and that she had "saved them (that is, Dalys and her husband) financially, on several occasions".
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29 Dalys denies telling Mrs Saastamoinen "on several occasions" that Mrs Macgregor would be leaving the house to Mervyn. However, it is not necessary to resolve that dispute, because Dalys says she has never denied that her mother wanted Mervyn to have the house.
30 Dalys exhibited to one of her affidavits, a letter she received from her mother in May 1996. Mrs Macgregor said she was proposing to ask Jeanette for a loan to enable her to have the house painted "as I have loaned her lots over the years". Mrs Macgregor said:
"(Jeanette) gave me the last lot back excepting a few hundred said she posted it I didn't get it … but I didn't argue about it … anyway I loaned her between 4 & 5 thousand."
- A little later in her letter, Mrs Macgregor said:
"As for leaving money etc to Jeanette she had her share. Paid a debt of 1000 pounds that Bruce borrowed from the Dutch chap who was married to Norma …. I gave to your children as they were growing up also. You & Jeanette have your homes so naturally I am going to leave whatever home I have to Mervyn, sounds as though you think I should it sold and divided it (sic). I am going to sell this big big house & get a smaller one, build on back of block if I can work it.
…
I am not going to have much to have money wise as I am spending it on myself …"
32 To return to Mrs Saastamoinen's evidence: she said that on one occasion, she mentioned something to Mrs Macgregor about her house. She said Mrs Macgregor replied:
"It is Mervyn's house … The house is for Mervyn, the others have had theirs."
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33 A neighbour of Mrs Macgregor's, Frederick Hilton Cavanough also gave evidence that on more than one occasion, Mrs Macgregor told him she would be leaving the house to Mervyn because he had been "so helpful to her during the long time they had lived together". Mrs Macgregor told Mr Cavanough also that she had assisted her daughters financially over the years "and for this reason Mervyn would inherit the house …".
34 Mrs Macgregor told Mr Stoker, (the co-executor named in the will) on Mothers day 1997, that after her death, she wanted Mervyn to have "all her assets including the home she had lived in for over thirty years". She said this was because Mervyn had elected to stay at home, rather than starting a family of his own. Mrs Macgregor told Mr Stoker she had provided generously for her daughters over the years. In particular, she said, she had given considerable financial help to Jeanette and her husband, to purchase a professional fishing boat. She referred to the "six-month trip" to Asia on which she took Dalys and said that both daughters had husbands whose responsibility it was to provide for their families.
35 Mr Stoker was not an entirely independent witness. He has been a friend of Mrs Macgregor for many years, and professed loyalty to her and to her testamentary wishes. Although named as executor in the will, Mr Stoker did not join in the grant of probate, because at the material time, he was living in New South Wales, where he was looking after his own mother.
36 I do not accept the submission made by counsel for the plaintiffs that the witnesses to whom I have referred, colluded in giving their evidence. As counsel accepted, the submission was, in substance, an allegation that the witnesses were lying.
37 It was put to Mr Stoker in cross-examination that he had colluded. He denied it: and I believe him.
38 The allegation was not put to the other witnesses. The submission that they lied is therefore made improperly. Indeed, as I have noted, Mrs Saastamoinen's evidence was accepted without challenge (although I do not accept all of it as being accurate).
39 In any event, I formed the impression from the way in which these witnesses responded to cross-examination, that they were telling the truth. That is to say, I accept that they have recounted the statements made to them by Mrs Macgregor and others, to the best of their recollection. Their
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- evidence was consistent with Mrs Macgregor's letter of May 1996 to Dalys. It is consistent also with Mervyn's evidence, which I accept, that "on many occasions" his mother told him she would be leaving the house to him.
40 It is well established that evidence of a testator's reasons for making his will as he did is admissible. The evidence does not prove the truth of statements made by a testator. It is received only as evidence of the testator's subjective reasons: and the reasons are not conclusive. As was said by the Court of Appeal of New Zealand in In re Green, deceased; Zuckerman v Public Trustee [1951] NZLR 135 at p 141:
" … the testator should not be allowed from the grave to condemn the child and to impose upon that child the positive duty of disproving the allegations as an essential preliminary to prosecuting the claim."
- That passage was approved by the majority of the High Court in Hughes v National Trustees, Executors and Agency Company of Australasia Ltd (1979) 143 CLR 135, at 152.
41 In other words, if (for example) a testator has explained his failure to make provision for a child on the basis of some disentitling conduct, it is not for the child to disprove the disentitling conduct. The onus remains with the party seeking to uphold the will to prove that which he or she asserts. The Court may have regard to the testator's reasons, because those reasons focus attention on issues which may need to be resolved in determining an application such as this.
The issues in this case
42 Jeanette and Dalys accept that Mervyn has a strong claim, which would justify an entitlement to half of their mother's estate. But they say they each had a close and loving relationship with their mother, who should not have overlooked their moral claims on her estate. They acknowledge that their mother provided some limited financial support for them, particularly in the early years of their respective marriages. They say this is of no great significance now, having regard to the size of their mother's estate and their relatively modest financial circumstances at her death. Jeanette and Dalys say also that Mervyn has received considerable financial assistance from their mother over the years: an allegation which he denies. Mervyn contends that the relationship between Jeanette and
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- Dalys and their mother was not as close as they would have it believed: and that adequate provision has been made for them already.
43 Mervyn therefore contends that the will should not be disturbed. He claims to have been his mother's "constant carer and companion during the last 25 years of her life until she died". That is disputed to some extent, by Jeanette and Dalys. Mervyn says also that the house was promised to him, and that in 1968, he and his mother entered into a contract to that effect.
44 If Mervyn is correct in saying that he has a contractual right to the house, then, as the law stood until 7 March 2003, that asset would not have formed part of the estate: Schaefer v Schuhmann [1972] AC 572. The claim made by Jeanette and Dalys would then have become largely irrelevant.
45 However, on 7 March 2003, the High Court delivered its judgment in Barns v Barns (supra). The Court held that the decision of the Privy Council in Schaefer v Schuhmann (supra) should no longer be followed: and that the decision of Street J at first instance is to be preferred: at (1969) 90 WN (Pt 1) (NSW) 400 at 407. The essence of that decision is that the promisee's rights to property the subject of the contract "are to be drawn through the will and hence are subject to certain laws affecting testamentary succession". Thus, in the present case the words "the deceased's estate" in s 6 of the Inheritance Act, must be taken to include the house.
46 In my view, however, it is still relevant to consider whether Mrs Macgregor did enter into a contract with Mervyn to devise the house to him. That is because the existence of such a contract would still be relevant to the strength of his moral claim on the estate.
Did Mrs Macgregor contract with Mervyn to devise the house to him?
47 This claim emerged at a relatively late stage in the proceedings. It is necessary to put it in context. To do that, I go back to 1996, the year in which Mrs Macgregor reached the age of 80 years.
48 I have already referred to the letter Mrs Macgregor wrote to Dalys in about mid-1996, in which she said she wanted to "sell this big big house & get a smaller one, build on back of block if I can work it".
49 Pausing there, two comments may be made. First, Mrs Macgregor contemplated that she might be leaving Mervyn a house other than the
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- Congdon Street house. Secondly, she did not contemplate that the sale of the Congdon Street house would result in capital becoming available to bequeath to Jeanette and Dalys. Mrs Macgregor intended to spend it on herself.
50 It appears from a letter Mrs Macgregor wrote to Dalys on 8 July 1996, that she had learned that she would not be permitted to subdivide the block on which the house stands. She was advised that she could build a granny flat and let the house. But, she said:
"I haven't the money unless I sell the house so that is out. When I get the house painted etc will try to find a house ready built in the metro area."
- In the same letter, Mrs Macgregor said:
"I will get in touch with the chap who sold your house if I can find his address."
52 Furthermore, I accept the evidence of Milton Gillett (Dalys' husband) that he gave Mrs Macgregor the agent's name and telephone number when she telephoned him "in June or July 1996". I therefore find that the agent was instructed on Mrs Macgregor's initiative.
53 Mervyn said, and I accept, that when he learned that his mother had signed the authority, he reminded her of her "promise". I take that to mean her promise to leave the house to him.
54 It is common ground that on 1 August 1996, there was a family meeting at the house. Present at the meting were Mrs Macgregor, Jeanette, Dalys, Milton and Mervyn.
55 I accept the evidence of Jeanette and Dalys that the meeting was called by their mother. I accept Dalys' evidence that she arranged the meeting after her mother had called it. Dalys said, and I accept, that she had a telephone conversation with her mother, who said, in substance, that she was desperate for money and tired of living in a house needing so
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- much maintenance, which Mervyn would not do, and which she could not afford to have done.
56 This is consistent with the position Mrs Macgregor had taken in various letters to Dalys. Her shortage of money was a recurrent theme: she repeatedly bemoaned the fact that she had enjoyed only small wins on "lotto". Further, as I have noted, Mrs Macgregor expressed her intention of borrowing from Jeanette to pay for the house to be painted.
57 According to Dalys and Jeanette, the purpose of the meeting was to persuade Mervyn to cooperate in the sale of the house. Both said there was a discussion in which their mother said she wanted to buy a smaller house, in which Mervyn could live with her. Alternatively, she offered to buy a house for him.
58 According to Mervyn, nothing was said at the meeting which suggested to him that his mother wanted to sell the house. It was his perception that Jeanette and Dalys were trying to persuade their mother to sell the house. Mervyn appears to accept that a suggestion was made that his mother should buy a house for him. However, he attributes the suggestion to Jeanette, who raised it in letters she wrote to her mother on 5 May and 11 August 1996. The second letter was, of course, written some days after the meeting.
59 Again according to Jeanette and Dalys, Mervyn reacted angrily to the suggestion that the house be sold, saying:
"My mother promised me this house and this house is what I want."
60 Mervyn denies this: he says it is "absolutely false". On his evidence, while he was out of the meeting, having tea in an adjacent room, Milton came in and said:
"Have you packed your bags yet boy? – Because you're out of there soon."
61 In a responsive affidavit, Milton, in turn, says that statement is false. Much of the affidavit evidence relating to this issue is unsatisfactory, being in a form which is inadmissible. The issue was not explored in cross-examination. However, it is not necessary for me to make a finding about the discussion at the meeting. That is because, accepting (without deciding) that Mervyn's evidence is true, the conduct of Jeanette and
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- Dalys would not, in my view, diminish the strength of any claim they may have on their mother's estate. I say that, for the following reasons.
62 The house was built in the early 1900's. By 1996, it was in poor condition and needed extensive maintenance. Neither Mrs Macgregor nor Mervyn had sufficient money to carry out that work. The situation was obviously a source of concern to Mrs Macgregor. Jeanette and Dalys were aware of that concern. It was therefore reasonable, in my view, for Jeanette and Dalys to attempt to persuade their mother to sell (if that is what they did).
63 It is abundantly clear that Mervyn wanted to prevent the sale of the house. On 2 August, the day following the family meeting, he lodged a caveat against the title, to protect his interest "as beneficial owner … pursuant to a trust agreement made in 1984" between him and his mother. The caveat was not lodged pursuant to a contract made in 1968.
64 In the statutory declaration made by Mervyn in support of his application for the caveat, he referred to the trust agreement:
"Whereby the registered proprietor agrees to hold the said land in trust for Mervyn Stanley Macgregor as the beneficial owner. Title to be transferred on or before the death of Janet Edna Macgregor to Mervyn Stanley Macgregor, as sole beneficiary."
- A few days after Mervyn lodged the caveat, the Registrar of Titles served a requisition requiring him to produce the trust agreement of 1984. Mervyn did not respond to the requisition. As he explained in his evidence, there was no trust instrument. It was, he said a verbal "fiduciary trust". He said he and his mother had attempted to sell the house in 1981-2, but had not achieved a satisfactory price. They had been unable to subdivide. According to Mervyn, his mother said words to the effect that she would stop trying to sell the house. She was convinced she would be there for the rest of her life. She told Mervyn:
" … if you go overseas again or do something here or there, I will hold the house for you. I won't sell it."
66 I have already said that I accept Mervyn's evidence about statements or promises made to him by his mother, to the effect that the house would be left to him. However, those statements fall far short of the creation of a
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- trust in the legal sense of that word: they were no more than informal statements of intention. Indeed, on Mervyn's evidence, the conversation between Mervyn and his mother in 1984, on which he relies, took place over the telephone, while his mother was in England. This emphasises the informality of the occasion.
67 Against that background, I turn to Mervyn's claim that Mrs Macgregor entered into a contract with him in relation to the house.
68 This claim was raised for the first time in an affidavit made by Mervyn on 8 April 2002, some 17 months after the proceedings were commenced, and over a year after Mervyn filed his first affidavit in answer to the claim.
69 In his 7 April 2002 affidavit, Mervyn said that in 1968, he made a verbal offer to his mother:
"that I would continue modernising and upgrading the property at 7 Congdon Street, Claremont, and also continue servicing, repairing and maintaining her motor vehicles into the future at no cost to her. In exchange for this being that she would leave the house to me.
My mother enthusiastically agreed with my intentions.
She then gave full approval of that which I had proposed in my offer to her.
Then in consideration of the offer; my mother … made a promise to me … that she would leave the house … to me in her will."
70 Mervyn contends that this is a "simple parol executory business contract", which continued for 31 years until her death. He contends that the will is "part evidence of the simple contract".
71 I do not accept that there was a contract as alleged by Mervyn. As I have said, I accept that there were informal discussions over the years between Mervyn and his mother about the disposition of the house. However, I am satisfied that these were in the nature of family discussions which were not intended to, and did not, create legal relations.
72 In any event, the arrangements to which Mervyn refers are far too vague and uncertain to have contractual force. Furthermore, the fact that Mrs Macgregor did not make her will until over 20 years later is quite
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- inconsistent with the "business contract" alleged. Mrs Macgregor was, of course a businesswoman in the 1960's.
73 I should add that there is evidence, being a letter to Jeanette from the Public Trustee, that Mrs Macgregor made a will on 19 November 1993. That document was not itself in evidence. Its contents are not known. I therefore take no account of any earlier will.
74 Had Mervyn believed a contract existed since 1968, it is surprising that he did not refer to it when he lodged his caveat, or in his first affidavit in response to this claim. The reason for the latter omission emerged from his cross-examination. When asked why he had not referred to the contract Mervyn said:
"When I spoke to my solicitor and mentioned contract, he conveniently either didn't want to know about it or conveniently steered me away and we never got back to it. I had to eventually find out myself that that's the agreement I had with my mother, that's what it was, that type of contract. I knew that it was a contract, a verbal contract, but I didn't know what it was called legally. So it never got into my first statement, first affidavit, or my second."
75 Given the nature of Mervyn's evidence about the alleged contract, I do not find it surprising that his solicitor did not pursue it. It seems that it was only after Mervyn started acting for himself that he attempted to fit the conversations he had with his mother into a legal category. In so doing, he reached a conclusion which is not supported by the evidence. Even if a contract had come into existence, as Mervyn alleges, it would not be enforceable. There is no memorandum in writing, as required by s 34(1)(a) of the Property Law Act 1969. The will itself cannot constitute such writing, because it does not refer to the contract.
76 Nor could it be said that Mervyn's conduct constitutes part performance of a contract. On Mervyn's evidence, he serviced his mother's car, painted the house three times, inside and out and "made many improvements to the house from my own resources and labour". Mervyn gave no details in his evidence down to trial. However, after I had reserved my decision, there was an exchange of submissions which was intended to relate to the significance of the decision of the High Court in Barns v Barns (supra). In his submissions, Mervyn supplemented his original evidence by sitting out the detail of the work he claimed to have
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- carried out on the house, as well as the work carried out on the basis of "natural love and affection" for his mother.
77 The work on the house fell in to the following main categories:
(1) removing the corrugated iron roof and a chimney and strengthening the timber frame so it would support a new tiled roof.
(2) replacement of the original ceilings throughout the house.
(3) replacing five doors with sliding doors.
(4) constructing built-in furniture for the kitchen and dining room.
(5) renovating and decorating the interior and exterior of the house.
(6) upgrading bathroom fittings.
78 Mervyn acknowledges that he carried out almost all of the above work before he left Australia for a working holiday in England. That was in 1970. However, Mervyn and Mrs Macgregor lived in Exmouth between 1967 and 1970. The house was let during that period. After the tenants vacated, Mrs Macgregor and Mervyn lived there for a short time, before his departure overseas. During that period Mervyn was working for Sydney Atkinson as a motor mechanic.
79 I accept that the work listed by Mervyn was carried out. However, I accept the evidence of Milton Gillett, who is a carpenter and joiner by trade, that most of the work was carried out before 1968 and that much of it was carried out by him, at Mrs Macgregor's request, albeit with Mervyn's assistance. Milton said that in 1968, he and Mervyn were very good friends. Mervyn says, and I accept, that he and Milton worked together as a team.
80 I am not persuaded, therefore, that the work listed above was carried out as part of any contract between Mrs Macgregor and Mervyn, which, on Mervyn's evidence, came into existence in 1968. Indeed, it was Mervyn's evidence, emphasised in cross-examination, that he agreed with Mrs Macgregor that he would continue to upgrade the house. The inference is that work of that nature had already been completed.
81 Mervyn has also listed the work carried out on the house after his return from England in about 1973. This included the construction of a substantial driveway, of reinforced concrete. The work was carried out
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- with the assistance of Milton and others at Mervyn's request (which Mrs Macgregor approved) in order to provide parking for a truck which Mervyn then contemplated purchasing.
82 The other work included the installation of stormwater wells, security screens, a potbelly stove, and upgrading and extending plumbing and electrical installations.
83 I accept that Mervyn carried out the work, and that he paid for most of the materials.
84 I accept Milton's evidence that he carried out an improvement in 1977, when he erected a screen wall in front of the outside toilet. I accept that he carried out that work, and some repairs at the same time, to offset moneys he and Dalys owed to Mrs Macgregor.
85 Accepting that Mervyn repainted the house three times over some 30 years, serviced his mother's car and (post 1968) carried out repairs and improvements often with Milton's assistance, that evidence falls far short of proving part-performance of the contract alleged by Mervyn. The evidence does not establish that the acts relied upon are "unequivocally and in their own nature referable to some such agreement as that alleged". That is the test established by Maddison v Alderson (1883) 8 App Cas 467, which has been applied consistently since then: see, for example, Ogilvie v Ryan [1976] 2 NSWLR 504.
86 In the present case, Mervyn's conduct is equally consistent with that of a dutiful son carrying out work at the request of his mother, to their mutual advantage. Mervyn was, after all, living in the house rent free, and carrying on his business from there, albeit in a shed which, I find, he constructed and extended at his own expense.
87 I am therefore satisfied that the house is not the subject of any trust or contract. Having reached that conclusion I turn to consider the claim made by Jeanette and Dalys on its merits. In order to do so, it is necessary to summarise the relevant evidence relating to Mrs Macgregor and her children.
Mrs Macgregor
88 Mrs Macgregor was born in Victoria in 1916. She came to Western Australia in about 1937. Mrs Macgregor's husband was Douglas Bernard Macgregor. There is very little evidence about him. It is sufficient to note that he died in 1948 as the result of an accident. He
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- had been a soldier. I assume that was during the Second World War, because Mrs Macgregor received a war widow's pension.
89 Mr and Mrs Macgregor had four children. Jeanette was the eldest. She was born on 21 April 1937. A son Robert Bernard was born on 23 July 1938. He died in a motor vehicle accident in 1967. Mervyn was born on 25 November 1943 and Dalys was born on 5 May 1948. Mrs Macgregor was seven months pregnant with Dalys when her husband died.
90 Having been widowed at the age of 32 years with four young children, Mrs Macgregor set about earning her living so that she could support herself and her family.
91 Mr Macgregor had carried on a Mobil service station business in Rivervale, from leased premises. He started the business shortly after the Second World War. Mrs Macgregor carried on the business after her husband's death, and continued until 1960. According to Jeanette, whose evidence I accept, Mrs Macgregor worked long hours. She was a good businesswoman and managed to build up the business.
92 It is a reflection of Mrs Macgregor's success that she was able to provide some secondary education for her children at private schools, and that, in 1962, she was able to purchase the house.
93 In 1964, Mrs Macgregor and Dalys went away together on an overseas holiday. They travelled to various Asian countries by ship and were away for three months. Mervyn says the trip was longer: but I accept Dalys' evidence.
94 In 1967, Mrs Macgregor and Mervyn moved to Exmouth where they operated a service station in partnership together under the name "Macgregor and Son". It was while Mrs Macgregor was living at Exmouth that her elder son, Robert, died. He was involved in a motor vehicle accident while travelling to Exmouth.
95 The Exmouth venture continued until 1970, when Mrs Macgregor and Mervyn returned to live at the house.
96 It is not clear how Mrs Macgregor occupied her time after she returned from Exmouth at the age of about 54. It seems that she bought and sold some investment properties at various places in Western Australia. The extent of these activities is disputed. I am unable to make any findings in relation to them, but I do not think it necessary to do so.
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97 In about 1975, Mrs Macgregor and Mervyn became involved in the Church of Scientology. Between 1982 and 1984 Mrs Macgregor lived in England and studied at premises owned by the Church of Scientology. Between 1986 and 1987, she lived in America, also at Church of Scientology premises.
98 It is Jeanette's belief that at least some of the money her mother derived from her business and investment activities, and from certain inheritances she received, were spent on or given to the Church of Scientology. Jeanette believes that, as a result, her mother had financial difficulties. Mervyn disputes that Mrs Macgregor had financial difficulties; but I prefer Jeanette's evidence which is supported by the statements made by her mother in the letters she wrote to Dalys in 1996. I have referred to those letters previously.
99 I find that, at least from 1996, Mrs Macgregor had barely enough money to meet her normal living expenses. One of the reasons for that, I find, was that in March 1997, Mervyn was partially disabled in a motor vehicle accident, and was unable to continue his business as an automotive engineer. He was therefore unable to contribute to the household expenses to the extent he had previously.
100 Mrs Macgregor's interest in the Church of Scientology was not shared by Jeanette and Dalys. According to them, their mother and Mervyn tried to persuade them to become active in the Church of Scientology but they declined to do so. This is denied by Mervyn who said that he and his mother once gave Jeanette and Dalys some literature about their religion but did not attempt to convert them or ask them to become active in the Church. I suspect that the conflict in their evidence results from their subjective views of the events in question. However, there is no doubt that the religious beliefs of Mrs Macgregor and Mervyn caused something of a rift in the family.
101 The rift was, I think, greater between Mervyn and his sisters. Mervyn says he got on well with them until about 1989. In that year, Dalys' daughter Natalie became very ill with anorexia and was admitted into Princess Margaret Hospital. It is common ground that Mrs Macgregor, Mervyn and Mr Stoker, visited Natalie in hospital. It was Dalys' perception that the purpose of the visit was to have Natalie discharged so she could be taken back to her mother's house for the purpose of being treated by "people from the Scientology organisation". Mervyn denies there was any such intention. Again, I suspect that the
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- conflict of evidence may have resulted from subjective impressions of the events. It is not necessary for me to make any finding about that matter.
102 Dalys said, and I accept, that although she was concerned that her mother and Mervyn might attempt to influence her children, in the end, she and her mother "agreed to disagree on the issue of the Church of Scientology". I think Jeanette's attitude was essentially the same.
Jeanette
103 As I have said, Jeanette was born on 21 April 1937. In 1948, when her father died, she was about 11 years old. Jeanette was then attending St Anne's Convent School. On her father's death she was transferred to Rivervale State School where she completed her primary schooling. She then attended Presbyterian Ladies' College as a day student. She boarded with family friends during that period.
104 Jeanette left Presbyterian Ladies' College after three years and attended Underwood Business College. She was then employed by the legal firm of Parker & Parker. She worked in the Accounts department. When Parker & Parker purchased a ledger machine, Jeanette was retrenched. She went to work with Metro Goldwyn Meyer Theatres in their booking office.
105 On 13 October 1956, Jeanette married Alan Bruce MacGregor. They have three children: one son and two daughters. The children are all adult. They are no longer dependent on their parents.
106 Since her marriage, Jeanette and Bruce have lived in country areas. They lived at Manjimup for 10 years from 1956 to 1966. Then, after a few months in Perth, they moved to Geraldton where they lived until 1976. They then moved to Leeman where they lived until 1983 before moving to Port Samson. Between 1988 and 1990, they travelled between Indonesia, Singapore and Malaysia, returning to Port Samson, where they lived until 1995 when Bruce retired. They then moved to Denham, where they now reside.
107 Because Jeanette and Bruce have lived at some distance from Perth during most of their married life, there were only limited opportunities for Jeanette and her mother to meet. However, I accept Jeanette's evidence that her mother visited them in Manjimup. On one occasion she stayed there for about two weeks, looking after Jeanette's older children while she was in hospital having her third child.
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108 While Jeanette and Bruce were in Perth in 1966, they rented a house in Claremont. They saw a good deal of Mrs Macgregor during that time. Mrs Macgregor would often pick Jeanette's children up from school and stay with them until Jeanette or Bruce returned home.
109 While Jeanette and Bruce were living in Geraldton, her mother and Mervyn stayed with them from time to time to break the journey to and from Exmouth. After Mrs Macgregor returned from Exmouth, she visited Jeanette and Bruce at their house in Bluff Point, Geraldton.
110 One of Mrs Macgregor's investment properties was a 10 acre block at Waggrakine, near Geraldton. Mrs Macgregor told Jeanette and Bruce that they were welcome to use the block in any way they wished without paying rent for it. Jeanette and Bruce accepted that invitation. They kept two horses on the block for their children to ride. They also kept chickens and ducks on the block and paid to have water connected to it for the purpose of growing peas. That was not, however, a successful venture.
111 Whenever Jeanette travelled to Perth from any of the country towns in which she was living, she always visited her mother.
112 In her affidavit, Jeanette said she had a close relationship with her mother. That was challenged by Mervyn. As I have said, he was unrepresented at the hearing. He therefore cross-examined Jeanette himself. The point Mervyn sought to make was that because Jeanette saw her mother infrequently, it was not appropriate to describe their relationship as "close". Mervyn said that Jeanette only visited their mother "for about twenty minutes every two or three years". I prefer Jeanette's evidence. In any event, physical separation, is not necessarily an impediment to a close relationship. I accept Jeanette's evidence about her relationship with her mother. I accept the evidence she gave in cross-examination that she and her mother corresponded and talked over the telephone regularly and that they saw each other at least twice each year.
113 I have referred above to the various moves made by Jeanette and Bruce over the years. From 1976 onwards, Bruce was employed in the fishing industry: and for most of that time on a succession of boats he owned. Mervyn contends that Mrs Macgregor gave Jeanette and Bruce $8,000 towards the construction of a fishing boat. This is denied by Jeanette, who set out in her affidavit of 27 March 2001, a comprehensive account of their house sales and purchases, and the funding of the boat purchases and construction. I accept that evidence.
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114 Jeanette says she and Bruce borrowed $5,000 from Mrs Macgregor in 1968, to assist them in the purchase of a house in Geraldton. I accept that evidence. It accords with the statement in Mrs Macgregor's letter of May 1996 to Dalys. I find that the loan was repaid subsequently. Furthermore, I accept Jeanette's evidence that she and Bruce bought a colour television for Mrs Macgregor as a thank you gift.
115 Jeanette says she and Bruce received no other financial assistance from Mrs Macgregor. In particular, she claims no knowledge of borrowing money from Peter de Haan. However, I find that Mrs Macgregor paid $1,000 to Mr de Haan in 1972, for or on behalf of Jeanette and Bruce. I regard these relatively modest payments, made many years ago, and (in the case of the $5,000 loan) repaid, as relatively trivial.
116 I accept Jeanette's evidence about her financial circumstances as at April 2001, when the proceedings were commenced. It is as follows:
|
| |
|
| |
$ | ||
|
| 185,000 |
| 5,000 | |
| 13,500 | |
203,500 | ||
|
| 6,300 |
117 I will assume that their position was similar in 1999, when Mrs Macgregor died.
Dalys
118 Dalys was born on 5 May 1948, some two months after her father's death. When Dalys was three years old, Mrs Macgregor became ill and
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- took Dalys to Victoria to stay with her mother. Dalys stayed with her grandmother for some time and then lived with her mother's brother and his family, also in Victoria. She was away for a total of 18 months.
119 Dalys attended Rivervale primary school until she was 10 years old, when she went to Iona Presentation College as a boarder until she was 14 years old. She attended Claremont Technical School in 1963 and went from there to Edwards Business College in 1964. She then obtained employment with Bairds Store in Perth. She subsequently worked as the secretary to the Manager of Bairds' Fremantle store.
120 As I have noted, Dalys and her mother went on an overseas trip together in 1964. I find that Mrs Macgregor paid for this out of an inheritance she had received from the estate of an old friend.
121 In 1967, when Mrs Macgregor and Mervyn went to Exmouth, Dalys was asked to leave the Congdon Street house, where she had lived since 1962, so that it could be let. Dalys says, and I accept, that this request upset her, as she was nervous about leaving home and living on her own.
122 In 1968, Dalys married Milton Gillett. They have three children, all of whom are adult and no longer dependent on their parents.
123 Dalys and Milton lived in Perth from their marriage until late 1994, when they moved to Augusta.
124 Dalys says that her relationship with her mother became very close when she was pregnant with her first child and remained so for many years. Dalys said her mother was a very loving grandmother to her three children. I accept her evidence that:
"I loved my mother very much and we had many wonderful happy times together as my children grew. She loved to have my daughter Natalie stay weekends and taught her to cook cakes. She used to take Natalie and her sister Tammy to the movies and they did fun things together during the school holidays."
125 None of this is disputed by Mervyn. Indeed, on his evidence in cross-examination, his mother contemplated the sale of the house in about 1980, so that she could move closer to Ardross where Dalys and Milton were living.
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126 I have already referred to the rift in the family caused by the religious beliefs of Mrs Macgregor and Mervyn: particularly in relation to Dalys' daughter Natalie. That incident resulted in some unpleasantness between Dalys and her mother. I find, however, that over time, the closeness of the relationship between Dalys and her mother was restored. This is reflected in the fact that Mrs Macgregor spent her 80th birthday in Augusta with Dalys and her family.
127 There are various disagreements in the evidence about the number and duration of visits made by Mrs Macgregor to Dalys and Milton in Augusta, and about where Mrs Macgregor spent Christmas, Easter and her birthdays. It is not necessary for me to resolve those disputes. I am satisfied that Dalys and her mother had a close relationship. This is quite apparent from Mrs Macgregor's letters to which I have already referred.
128 Mervyn contends that from about 1996, Dalys and Jeanette wanted to drive a wedge between him and his mother, and that they wrote and telephoned to her in order to persuade her to sell the house and move into a nursing home of some kind.
129 It is clear from a letter written by Dalys to her mother on 11 August 1996 that Mrs Macgregor did have the perception that her daughters wanted her to move. However, I find that Dalys and Jeanette acted in what they believed to be their mother's best interests, she having fallen and broken her nose shortly before that date. As I have already noted, this was at a time when Mrs Macgregor was complaining about lack of money and her inability to pay for the maintenance which the house required.
130 I make that finding despite Mervyn's evidence, which I accept, that some of Dalys' telephone conversations left their mother in tears. I have no doubt that the situation in which they found themselves was very difficult for all concerned, particularly as Mrs Macgregor was clearly a person of independent spirit.
131 Dalys has set out in her affidavit of 5 April 2001, details of the financial arrangements she and Milton have made over the years in purchasing their successive houses.
132 I accept that evidence, in which Dalys refers to borrowing about $2,000 from her mother in 1970, which was repaid in full subsequently. Dalys and Milton borrowed a further $1,600 in 1974. All but $300 was repaid, but Milton carried out various work at the house in lieu of repayment. I have already set out my findings in relation to that.
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133 I find also that Mrs Macgregor made small gifts of money and/or food to Dalys and/or her children over the years.
134 As with Jeanette, I do not regard these small loans or gifts as of any significance in this application.
135 Dalys is employed as a part-time carer at an aged persons hostel. She earns $24,730 gross per annum.
136 Milton is a self-employed roof carpenter, who works when he can. He earns $8,000 net per annum. Their assets are:
| $170,000 |
| 500 |
| 2,900 |
1984 Ford Falcon | 2,000 |
$175,400 |
137 Dalys and Milton spend all their income on living expenses. They have no savings, but Milton has a superannuation policy which will mature in 12 years (on his retirement) and is expected to return $26,700.
138 Dalys has two similar policies, worth about $4,500. She suffers from varicose veins and needs an operation to relieve the pain. However she cannot afford to take time out from her work so as to have the operation, because she would lose too much income.
139 Dalys and Milton have built their home in Augusta and would like to establish it by completing a garden, and building fences and gates. They cannot afford to do so at present. Dalys needs also to replace the old motor car she drives to work. She and Milton find it expensive to maintain and run their two elderly vehicles.
Mervyn
140 Mervyn was born on 25 November 1943. He had his secondary education at Scotch College, where he was a boarder. He left there at the age of about 17 years and spent six months with Jeanette and her husband in Manjimup. There is a dispute about the reason for Mervyn staying with
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- Jeanette and her husband. They say he had been misbehaving and playing truant from school and that when he stayed with them, he stole cars. Mervyn denies any misdemeanours other than falling in with "a bad crowd" and staying up too late. It is not necessary to resolve that issue.
141 In 1958 or 1959, Mervyn moved to Perth and was apprenticed as an automotive mechanic with Sydney Atkinson, then a prominent motor vehicle dealer.
142 After completing his apprenticeship, Mervyn attended technical college where he qualified as an automotive engineer. Apart from short periods of employment in other occupations, Mervyn was self-employed as an automotive engineer for some 30 years, until a motor vehicle accident in March 1997 made it impossible for him to pursue that occupation.
143 Apart from a short period on a drilling rig in the 1970s, the three years of partnership with his mother at Exmouth and a period between the early 1970s and 1974 when he worked in England, Mervyn carried on his business from a shed at the rear of the Congdon Street house which had access through a laneway. Mervyn traded under the name Edge Automotive. The word Edge is an acronym for "engine, differential and gearbox engineering".
144 Mervyn has never married. He said, and I accept, that he was engaged to be married while he and his mother were in Exmouth. His fiancé was from Perth and was unwilling to wait for him to return there. She married someone else while Mervyn was in Exmouth.
145 Mervyn said he had a very close relationship with his mother, with whom he lived for most of his life. He said he was required to fulfil the role of the man of the household since his father died when he was young, and even more so after his brother died. Mervyn said "I was my mother's constant carer and companion during the last 25 years of her life until she died".
146 I accept the companionship element of that evidence, but on Mervyn's own evidence in cross-examination, I do not accept that he was his mother's carer for 25 years.
147 It is clear that in her prime, Mrs Macgregor was an active, independent and hardworking woman. She sustained an injury to her right shoulder in a motor vehicle accident some 15 years before her death. According to Mervyn that accident gave his mother "aggravation on many
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- occasions". However, the only activity which Mervyn could recall being curtailed as a result of the accident, was her knitting. Despite that, Mervyn said that following the accident, there was a major change in their domestic arrangements, involving a higher degree of domesticity on his part. He did more of the cooking and shopping.
148 In more recent times, it was Mervyn's regular task to cook the evening meal, following which, he and his mother would do the washing up together. Sometimes Mrs Macgregor would cook or do the dishes herself. Mrs Macgregor always insisted on cleaning the kitchen floor. She and Mervyn shared the vacuum cleaning approximately equally. Mervyn would attend to washing the clothes but, as he put it "that’s just a matter of throwing it in the machine". Mervyn would always help his mother hang out the larger items of washing, such as double bed sheets. He would also see to the washing of kitchen curtains because his mother was unable to reach them, as the house has 11-foot high ceilings. Mrs Macgregor would usually do the dusting.
149 I accept that account of Mervyn's domestic activities. However, they seem to me to reflect sharing rather than caring. I find that Mrs Macgregor had an independent nature, and wanted to do as much as she could for herself, and probably, for Mervyn. I accept Dalys' evidence that her mother declined an invitation to visit her, after Mervyn had his accident in 1997, because she said she could not leave him on crutches. I accept Mervyn's evidence that his mother later declined to accept assistance from the Silver Chain organisation.
150 I accept Mervyn's evidence that he carried out all the maintenance required on Mrs Macgregor's motor vehicles. He put a power steering unit in her HQ Holden motor car because of the weakness to her right arm following her accident. I accept also, that Mervyn drove his mother most of the time.
151 I accept that Mervyn carried out some maintenance work on the house and that he upgraded the security and carried out other maintenance such as repairing the washing machine.
152 I find that he did some of the gardening, although apparently without a great deal of enthusiasm. He admitted that he had "somewhat" neglected the maintenance of the house in recent times, because of the action.
153 I accept that Mervyn paid the majority of water, power and telephone accounts and council rates relating to the house. I find that there was no
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- formal arrangement between Mervyn and his mother in relation to these matters and that sometimes Mrs Macgregor would make payments. I find that Mervyn purchased some of the food he and his mother consumed and that he purchased petrol and oil for the car which, although it belonged to his mother, was more commonly driven by him.
154 Although Mervyn said he made these payments in lieu of rent, there is no evidence that his mother ever asked him to pay rent for his use and occupation of the house or the shed from which he carried on his business over many years.
155 In the motor vehicle accident to which I have referred above, Mervyn's right leg was injured. This has resulted in a continuing incapacity, entitling him to a disability pension, albeit subject to biennial review. I noted that Mervyn used crutches when he appeared in Court. There is no medical evidence about his condition.
156 Mervyn claims not to have received any financial assistance from his mother, other than money he borrowed from time to time when the income from his business was irregular. He said he always repaid his mother.
157 Jeanette, however, says she was told by her mother that she had to send $30,000 to England in 1974, to enable Mervyn to return to Australia. She says her mother told her also that she gave Mervyn $11,000 to enable him to take an invention to America, in order to patent it.
158 Both of these matters are denied by Mervyn. He says he paid for his own return passage from England, out of his earnings there. He says he paid his own way to America: and that he obtained US patents for his invention while in Australia.
159 There is no documentary evidence relating to these matters. Only Mervyn has direct knowledge about them, and his evidence was not challenged in cross-examination. I therefore accept Mervyn's evidence. I find that Mrs Macgregor did not make the payments totalling $41,000 to Mervyn, or on his behalf.
160 Mervyn was extremely vague, in his cross-examination, about the income he had derived from his business. He said he had thrown away his pre-1997 income tax returns, and he could not remember what his income had been. In any event, he said, the income disclosed in the returns was "possibly not" a truthful reflection of his earnings, being under-estimates.
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161 His financial position, as at March 2001 was:
Income – disability person, or sickness allowance : $178.30 per week
Personal effects (estimated) : $ 2,760
Lump sum compensation payment (net estimated) : $ 11,500
162 As at the hearing, his income was $435.20 per fortnight.
163 I have considerable doubt about Mervyn's ability to resume his business as an automotive engineer. His evidence was that the injury to his leg has so far made this impractical. That evidence was not challenged, and I accept it. There having been no improvement in his condition after six years, it seems to me unlikely that he will improve in the future.
164 There is another factor. According to Dalys, whose evidence was not challenged, Mervyn does not have the equipment necessary to carry out work on modern motor cars. There is no evidence that he has upgraded his qualifications so as to be able to work on modern computerised motor vehicles. I assume he lacks those qualifications. Dalys says and I accept, that even before his accident in 1997, Mervyn's client base was reduced to family and friends.
165 I am satisfied, that over the years, Mervyn has been supported to a considerable extent by his mother, and that he was dependent on her for both his residential and business accommodation.
Mrs Macgregor's estate
166 As executor, Mervyn provided a statement of assets and liabilities as follows:
| Out of W.A. | In W.A. |
Estimated value at date of death | $ | $ $ 1,860.00 |
Estimated value at date of death | $ 550.00 |
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|
Estimated value at date of death | $ 2,543.27 |
|
| $ 21.40 |
TOTAL | $ NIL | $ 4,974.67 |
| ||
|
| $ 455,000.00 |
| $ NIL | $ 459,974.67 |
| Out of W.A. | In W.A. |
| NIL | NIL |
| $ NIL | $ NIL |
| $ NIL | $ 459,974.67 |
167 In his cross-examination, Mervyn said he based the value of the house on general prices in the area, newspapers and brochures. The house has now been valued by Ian John Rae, a licensed valuer who has had 22 years experience in valuing property.
168 Mr Rae valued the house as at July 2002. He based his value on comparable sales in the area and an inspection of the house itself. As to improvements, Mr Rae reported as follows:
"Constructed on the land is a single level character residence which is fairly typical of original housing development in the locality. Construction comprises limestone footings, timber floors, cavity brick elevations and a combination of tile and corrugated asbestos roof cladding.
The residence has a living area of approximately 133m2 plus return verandah of 32m2. Accommodation comprises two
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- bedrooms, two sleepouts, formal lounge, kitchen/meals, living room, bathroom and toilet. Appointments to service areas are modest and in the case of bathroom fittings, poorly maintained. With the exception of an original fireplace to the formal lounge, few architectural features of the era are in evidence today.
The structural condition of the home is generally poor and it is clear that regular building maintenance has been neglected for some time. At the time of our inspection, we noted wall cracks evident in most rooms, sagging ceilings indicating water damage at some time, poorly maintained painted surfaces and neglected treatments.
Outbuildings to the side and rear of the residence include:
• Brick and iron single garage
• Fibro garage/workshop to the rear
• Original laundry and toilet
Grounds, front and rear are in a neglected and overgrown state and we noted some evidence of a poorly maintained stormwater drain to the rear of the residence."
169 Mervyn did not take issue with Mr Rae's report, other than in relation to the stormwater drain which Mr Rae said had been poorly maintained. Mervyn denied that. However, as the precise location of the stormwater drain was not identified in evidence, it is by no means clear that both witnesses were referring to the same service.
170 Mr Rae went on to say that because the existing building improvements had been generally neglected over the years, it was arguable that the improvements might add little, if any value to the site. I accept Mr Rae's evidence.
171 The house is included in the Municipal Inventory prepared by the Town of Cottesloe in 1995. It has been given a Category 3 listing which suggests that it should be retained and conserved if possible.
172 Mr Rae said in his evidence-in-chief, that if the house was put on the market, some purchasers would retain or substantially retain the existing building with character features intact and add to it. Equally, Mr Rae said there are others who would prefer to redevelop the site. For such purchasers, the improvements would be unlikely to have any value. At
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- present, it is impossible to say whether redevelopment would be permitted. Mr Rae said in his report:
"We believe that this issue will create an air of uncertainty in the minds of intending purchasers and will, as a result, impact on any assessment of fair market value."
174 Mr Rae estimated the current value of the property (as at January 2003) to be of the order of $675,000. He based his estimate on market conditions and more recent valuations in the area.
175 I accept Mr Rae's evidence generally.
Conclusion
176 I have already referred to Mrs Macgregor's reasons for making the will as she did. She had no assets of any consequence other than the house. She thought that because Jeanette and Dalys were married to husbands who were supporting them and had their own houses, she should devise the Congdon Street house to Mervyn because it had been his home for over 30 years. Furthermore, she apparently thought she had made provision for Jeanette and Dalys by the financial assistance she had given them over the years.
177 It is recognised by Jeanette and Dalys that in all the circumstances, it was appropriate for Mrs Macgregor to provide a house for Mervyn. That is not because he is entitled to be rewarded for acting as his mother's companion over the years. It is well settled that the Inheritance Act is not intended to provide rewards for services rendered. In any event, the impression I have is that although the arrangements no doubt suited both Mervyn and his mother, he derived as much benefit from them as his mother did. His entitlement arises from the fact that at Mrs Macgregor's death Mervyn was dependent on her for accommodation, which he is unable to provide for himself.
178 But has adequate provision been made for Jeanette and Dalys? The fact that they are adult, married and supported by their husbands does not disentitle them from consideration by their mother. In Scenini v Public Trustee & Ors, unreported; SCt of WA (White J); Library No 940058; 11 February 1994, White J followed the decision of the High Court in
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- Stott v Cook (1960) 33 ALJR 447, where it was held that a testator should have made provision for the applicant, who was a 47 year old married son who was in employment – albeit not of a kind which was necessarily permanent. As White J put it:
"An adult child should not be left in circumstances where he has to struggle if a parent has the capacity to overcome this by testamentary provision (at p 9)."
180 Mervyn was, of course, in a similar position, with the added handicap of uncertain employment prospects, having regard to his age, lack of relevant qualifications (as I infer) and his injury.
181 I have already held that although I am satisfied that Mrs Macgregor did provide some financial assistance to Jeanette and Dalys over the years, that assistance did not amount to very much.
182 In the course of these reasons, I have dealt with some of the allegations made by Mervyn against his sisters and by them against Mervyn. As I said during the course of the hearing, many, if not most, of those matters are irrelevant. That is why I have not made findings about every complaint. Indeed, it would not be possible to do so, having regard to conflicts in the evidence which were not explored in cross-examination because it was not necessary to do so. Having considered all the matters of conduct raised by the parties, I am satisfied that there has been no conduct on the part of Jeanette, Mervyn or Dalys which would have disentitled any of them from consideration by their mother.
183 In my view, a wise and just testator in Mrs Macgregor's position, while recognising the need to provide Mervyn with a house, ought also to have made some provision for Jeanette and Dalys.
184 Although I have no expert evidence about the value of the Congdon Street house as at the date of Mrs Macgregor's death, the $455,000, which is Mervyn's estimate, is accepted by Jeanette and Dalys as being correct.
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185 But whatever the value of the house, it is, on Mr Rae's evidence, in an area which is regarded as desirable. That being so, it should have been possible to enable Mervyn to purchase suitable accommodation and still have some capital available for distribution to Jeanette and Dalys.
186 The difficulty in cases such as this is to determine "prevailing community standards of what is right and appropriate": that is the test to be applied, as I have noted above.
187 On behalf of Mervyn it may be said that to require him to leave his home of some 40 years, in his partially disabled state would be unduly harsh. On behalf of Jeanette and Dalys, it may be said that to deny them any interest in their mother's estate, when each is struggling in the way I have described above, would be equally harsh.
188 On balance – and it is, I think, a fine balance – I consider that Jeanette and Dalys have a justifiable claim. The house is not Mervyn's. Although he has expended time, effort and money on it, I am not persuaded that he has thereby acquired an entitlement to retain it for himself. Furthermore, most of the work was carried out many years ago: and he has had the use and enjoyment of it.
189 If the application was dismissed, Mervyn would be left with a run-down house and no funds to maintain it. He is not now able to carry out the necessary work himself. Mervyn might well be driven to sell the house in any event. If he did, he would be in a much more secure financial position than his sisters.
190 In all the circumstances, I am of the opinion that the disposition of Mrs Macgregor's estate, effected by her will, is not such as to make adequate provision from her estate for the proper maintenance or support of Jeanette or Dalys. It is therefore necessary to consider the second question arising under s 6 of the Inheritance Act.
What provision should now be made for Jeanette and Dalys?
191 In answering this question, it is necessary to have regard to the present circumstances of Jeanette and Dalys as well, of course, as Mervyn's present circumstances.
192 So far as Jeanette is concerned, there has been a deterioration in her health. She told me she was diagnosed with chronic myeloid leukaemia in February 2002. She said she was hospitalised at first and then started on
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"injections and tablets; chemotherapy". When asked what treatment she was having currently she said "I'm still on the needles".
193 Jeanette said her treatment had not had a great deal of impact on her personal circumstances, apart from frequent trips to Perth. She said that "a bit later on" she and Bruce might have to sell their home and move closer to hospitals. She said that at present she was attending the Sir Charles Gardiner Hospital.
194 In her very recent and unchallenged evidence, Jeanette said she was being treated by a new drug, at a minimal prescription cost. This treatment required her to attend a doctor in Perth on a monthly basis.
195 This evidence is unsatisfactory. I do not doubt Jeanette's evidence. However, given that she is receiving specialist medical attention, the appropriate course would have been for a medical report to have been produced which contained information about Jeanette's diagnosis, prognosis and the nature and cost of her treatment.
196 In the absence of that evidence, I do not think it proper to differentiate between Jeanette and Dalys. I infer that they wish to be treated equally, in any event: they have both instructed the same firm of solicitors and were represented at the hearing by the same counsel. In other words, they do not regard themselves as having any conflict of interest.
197 As I have said, the position now is that the house is valued at $675,000. I accept that Mervyn has a sentimental attachment to it. In his affidavit of 7 April 2002 Mervyn said:
"Knowing the house would be left to me, I have built and installed items for my own personal use also, over a 35 year period. To have to demolish these and try to rebuild them some other place, would be impossible for me to do in the present situation I find myself in and the little quality of life I do have left would be destroyed and to have to do without them would make my life a very miserable one indeed."
198 I have referred above to the works carried out by Mervyn over the years. However, Mr Rae does not attribute any value to them. He painted a picture of neglect and disrepair. It seems to me, that if Mervyn was to be left with the house, there is a strong probability that it would have to be sold in the foreseeable future. That is because Mervyn does not have the funds to pay for repairs and maintenance and he is prevented by his
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- current disability from carrying out the work himself. Although Mervyn said he would like to do the work himself, and had done "a couple of little things", he said he was unable to get on a ladder. Given that the house has 11-foot high ceilings I do not see how he could undertake any work of any consequence when subject to that handicap.
199 More to the point, because the house is the only substantial asset in the estate, it would not be possible to make provision for Jeanette or Dalys without selling it. Mervyn is in no position to borrow funds with which to make a payment to them.
200 I do not know how much Mervyn would have to spend in order to provide suitable accommodation for himself and perhaps a family. He told me his ambition was to "find myself a wife, get married and have some children because basically I'm the last male in this actual family and I'd like to continue the line". Equally, of course, it is not possible to say precisely how much the house would realise on a sale in the reasonably near future.
201 In these circumstances, it seems to me that the provision which ought to be made for Jeanette and Dalys should be defined by reference to fractions of the estate. It was submitted on behalf of Jeanette and Dalys that Mervyn should have one-half of the estate with the remaining half to be divided equally between them.
202 I assume that the net proceeds of sale, after deducting the expenses of sale and the costs of this litigation (which at present I think should be borne by the estate) would be about $600,000. On that basis, Mervyn would have a capital sum of the order of $300,000. Jeanette and Dalys would receive of the order of $150,000 each.
203 The difficulty with that approach is that although it would provide Jeanette and Dalys with a capital sum which could be used for any purpose, Mervyn would have no similar reserves unless he was able to buy a house for about $150,000. It is true that Jeanette and Dalys have houses which are worth about $180,000, but they are remote from Perth. Mervyn has lived for most of his life in the Claremont/Cottesloe area and I think it would be unreasonable to expect him now to move into the country.
204 Furthermore, Mervyn has as much need as his sisters for a reserve fund to enable him to cope with the vicissitudes of life as it unfolds. To provide Mervyn with a house, and no more, would be to leave him in a
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relatively weaker position than his sisters, despite their acknowledgement that he should be entitled to a much greater share in the estate than theirs.
205 In this context, I take no account of the payment of $11,100 received by Mervyn as compensation for his accident. That is because the payment should not be regarded as improving his position, but, so far as possible, restoring it.
206 I therefore think the appropriate course would be to make provision for Jeanette and Dalys to the extent of one-sixth each of the net estate. Mervyn would have four-sixths. Again, assuming a net estate of $600,000, Jeanette and Dalys would each take $100,000 and Mervyn would have $400,000.
207 The result of that disposition should permit Mervyn to purchase some acceptable accommodation while retaining a cash reserve, albeit perhaps a smaller reserve than each of sisters would obtain.
208 The difference between their $100,000 and the $150,000 Jeanette and Dalys hoped to obtain is significant but not overly so. An amount of that order would not make a huge difference. It would only provide a modest cushion to protect them from potential difficulties in their lives. In Jeanette's case, an additional $100,000 should enable her to purchase a house in the Perth metropolitan area which would facilitate the access to Sir Charles Gardiner Hospital she may need for the continuation of her treatment.
209 As I have noted above, my present view is that the costs of this litigation should be borne by the estate. That is because although the plaintiffs' case is justified, I do not regard it as unreasonable for Mervyn to have defended it, given his belief, supported by the evidence of credible witnesses, that the house would pass to him on his mother's death.
Orders to be made
210 I order that provision be made for Jeanette and Dalys to the extent of one-sixth of the net estate, as defined below.
211 Assuming that the house at 7 Congdon Street, Cottesloe, will have to be sold, in order to give effect to this order, the net estate will be calculated as follows:
212 Gross Proceeds of sale of the house
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Add Monies amounting to $2,564.67 and any accrued interest thereon.
Deduct The costs of sale of the house
The costs of this application, to be taxed
The amount necessary to reimburse the costs of Mrs Macgregor's funeral
213 I have excluded from the calculation the household chattels and furniture and Mrs Macgregor's motor car, to which Mervyn attributed values of $1,860 and $550 respectively. I would not disturb those provisions of the will by which those chattels passed to Mervyn.
214 The order is intended to be final. However, I am conscious of the fact that, in the circumstances to which Mr Rae referred in his valuation report, the sale price may be higher or lower than the valuation.
215 If significantly lower, the value of Mervyn's share may be inadequate for the purpose I hope to achieve, and may therefore result in hardship to Mervyn. I therefore draw attention to s 15 of the Inheritance Act, which permits the Court to (inter alia) reduce the provision made under an order.
216 If the sale price of the house was significantly greater than the valuation, the provision for Jeanette and Dalys may, depending on their circumstances at the time, result in undue hardship to one or other of them. In such a case, the Court has jurisdiction, under s 16 of the Inheritance Act, to make an order for increased provision if it would not be inequitable to do so.
217 While applications under s 15 or s 16 should not be made lightly – and would be likely to result in adverse costs orders to an unsuccessful applicant, I think it appropriate to draw the parties' attention to these provisions. Subject to my availability, I would reserve any such applications to myself.
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