Mataska v Browne
[2013] VSC 62
•22 February 2013
| IN THE SUPREME COURT OF VICTORIA | Not Restricted | |
AT MELBOURNE
COMMERCIAL AND EQUITY DIVISION
PROBATE LIST
No. 4822 of 2012
| ANTONINA MATASKA | Plaintiff |
| v | |
| TRUDI BROWNE (who is sued as executrix of the Estate of JANINA NOWACZEK, deceased) | Defendant |
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JUDGE: | McMillan J | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 5 October 2012 | |
DATE OF JUDGMENT: | 22 February 2013 | |
CASE MAY BE CITED AS: | Mataska v Browne | |
MEDIUM NEUTRAL CITATION: | [2019] VSC 62 | |
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ADMINISTRATION AND PROBATE – Application for limited grant – Application to pass over executrix – Due and proper administration of estate – Standing to apply for limited grant – Standing to apply to pass over executrix – Whether contingent interest pursuant to Part IV of Administration and Probate Act 1958 sufficient to support standing – Testatrix leaving estate to sole beneficiary – Largest asset passing by survivorship to sole beneficiary
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | S Newton | Clark Toop & Taylor |
| For the Defendant | R B Phillips | Slater & Gordon |
HER HONOUR:
Introduction
By originating motion filed 22 August 2012, the plaintiff seeks the following orders:[1]
a) a limited grant of letters of administration with the will annexed of the estate of Janina Nowaczek (‘the deceased’);
b) that the defendant be passed over as the executor of the estate of deceased; and
c) a declaration that the defendant holds the property situate and known as 2/23 Kyle Road, Altona North (‘the Altona North property’) on trust for the estate of the deceased.
[1] The plaintiff also sought the removal of the defendant as executor pursuant to s 34 of the Administration and Probate Act 1958. This was not pursued at the hearing, as probate of the will had not been granted.
By summons filed 27 September 2012, the defendant seeks to dismiss the plaintiff’s proceeding as disclosing no cause of action, pursuant to r 23.01(1)(a) of the Supreme Court (General Civil Procedure) Rules 2005, or, alternatively, on the ground that it has no real prospect of success, pursuant to s 62 or s 63 of the Civil Procedure Act 2010.
Background
The deceased died on 2 May 2012, aged 89 years. She is survived by her two adult children, the plaintiff and the defendant.
At the age of 81 years, the deceased made a will dated 13 April 2004 (‘the 2004 will’),[2] which appointed her two children as her executrices and left her estate to them equally. The 2004 will was drawn by solicitors, Secombs of Footscray, under the reference ‘Mr Spillane’.
[2]Exhibit AM2 to the affidavit of the plaintiff sworn 21 August 2012 (‘the plaintiff’s affidavit’).
At the age of 82 years, the deceased executed an enduring power of attorney on 17 March 2005,[3] by which she appointed both the plaintiff and the defendant as her attorneys. The power of attorney was prepared by Secombs of Footscray. The witnesses to the enduring power of attorney, a doctor of Williamstown Hospital and a solicitor, ‘John Patrick Spillane’, stated that, at the time of signing, the deceased appeared to them to have the capacity necessary to make the enduring power of attorney.[4]
[3]Exhibit AM10 to the plaintiff’s affidavit.
[4]As required by the Instruments Act 1958 s 125A.
At the age of 86 years, the deceased executed her last will dated 19 November 2009 (‘the 2009 will’),[5] by which she appointed the defendant as her executrix and left the whole of her estate to the defendant. The will was drawn by Slater & Gordon, incorporating Secombs of Footscray, and was witnessed by solicitor, ‘John Spillane’, and a legal assistant, Christine Spence.
[5]Exhibit AM1 to the plaintiff’s affidavit.
When she was aged 88 years, the deceased and the defendant executed a contract of sale dated 29 March 2011[6] whereby they purchased the Altona North property for $520 100. A deposit of $26 000 was payable on 29 April 2011 and the balance of $494 100 was payable 14 days after the vendors gave notice of either registration of the plan of subdivision or the issue of an occupancy permit, whichever was the later. The solicitors acting on behalf of the deceased and the defendant were Clements Hutchins & Co of Altona.
[6]Exhibit AM4 to the plaintiff’s affidavit.
Some eight days later, by contract of sale dated 6 April 2011,[7] the deceased sold her home, known as 62 William Street Newport (‘the Newport property’), for $600 000. The Newport property was her major asset. A deposit of $60 000 was payable on 8 April 2011 with settlement due on 3 October 2011 or one month earlier by agreement. The solicitors acting on behalf of the deceased for the sale were Clements Hutchins & Co.
[7]Exhibit AM3 to the plaintiff’s affidavit.
On 23 May 2011, the sum of $17 150, being a release of the deposit from the sale of the Newport property, was paid at the direction of the deceased to the defendant.[8]
[8]Exhibit AM7 to the plaintiff’s affidavit.
Settlement of the sale of the Newport property took place on 17 October 2011.[9] On the same day, settlement of the purchase of the Altona North property took place.[10] The funds required for the settlement of the purchase of the Altona North property were obtained from the proceeds of sale of the Newport property.[11] On 2 November 2011, the deceased and the defendant were registered as joint proprietors of the Altona North property.[12]
[9]Exhibit AM7 to the plaintiff’s affidavit.
[10]Exhibit AM5 to the plaintiff’s affidavit.
[11]Exhibits AM5 and AM7 to the plaintiff’s affidavit.
[12]Exhibit AM6 to the plaintiff’s affidavit.
In April 2012, the deceased was placed in palliative care.[13]
[13]The plaintiff‘s affidavit, para 14(b).
As stated, the deceased died on 2 May 2012, aged 89 years. At the date of her death, her estate comprised $12 640.18, out of which expenses of $7734 have been paid.[14] The defendant did not apply for a grant of probate of the deceased’s last will on the grounds that it was unnecessary for her to take out a grant to administer the small amount remaining in the estate. The balance of the estate, approximately $5000, will pass to the defendant pursuant to the 2009 will. The Altona North property passed to the defendant by way of survivorship.
[14] Exhibit AM8 to the plaintiff’s affidavit.
The plaintiff believes that the purchase of the Altona North property in effect amounts to a gift by the deceased to the defendant of almost the whole of the deceased’s assets, and is liable to be set aside for the following reasons:[15]
[15] The plaintiff’s affidavit, para 14, sets out the basis of her belief.
a) the deceased was aged 88 at the time of the property transactions in 2011;
b) the deceased was placed in palliative care in April 2012;
c) the plaintiff does not know whether the deceased received independent legal advice in relation to the transactions and, in particular, in relation to the acquisition of the Altona North property as joint tenants;
d) the deceased received no consideration for the registration of the Altona North property as joint tenants; and
e) the deceased provided all of the funds for the purchase of the Altona North property.
Plaintiff’s Submissions
The plaintiff’s submissions are as follows.
The Court has the power to make a limited grant.[16]
[16]Ross A Sundberg, Griffith’s Probate Law and Practice in Victoria (Law Book, 3rd ed, 1983) 201–2.
A named executor can be passed over if the due and proper administration of the estate requires it.[17] In making her application, the plaintiff relies on the law relating to the due and proper administration of estates.
[17] LexisNexis Butterworths, Wills Probate and Administration Service, vol 1 (at Service 51) [28,150].
Prima facie, the transactions between the deceased and the defendant merit careful investigation. If it is assumed that the plaintiff’s statements of belief are true, then it should not be correct that the plaintiff is prevented from ensuring that the proceeds of sale from the Newport property be returned to the estate of the deceased. The only reason the plaintiff would not be able to pursue such a course of action is because she is not named in the deceased’s will as a beneficiary.
In the circumstances of this case, the due and proper administration of the estate requires the ascertainment of the composition of the deceased’s estate and, in particular, whether or not the proceeds of sale of the Newport property ought rightfully to be returned to the estate of the deceased. It also requires the determination of the plaintiff’s entitlement to share in the estate either pursuant to the deceased’s 2009 will or by the operation of Part IV of the Administration and Probate Act 1958 (‘the Act’).
If the defendant remains the executor, then the issue whether the proceeds of sale from the Newport property should be returned to the estate will not be determined, owing to the obvious conflict of interest on the part of the defendant. Accordingly, the due administration of the estate requires the appointment of another person who would be able to ensure that such a determination occurs.[18] Given that the only person other than the defendant who has any financial interest in this issue is the plaintiff, she is the appropriate person.
[18]Monty Financial Services Ltd v Delmo [1996] 1 VR 65.
Counsel for the plaintiff submitted that this case raises different issues from those in the decision of Wood v McLean,[19] a decision relied on by the defendant in support of her petition to dismiss the proceeding. Counsel submitted that Wood v McLean was authority for the narrow proposition that a person whose interest in an estate is not present or actual, but merely contingent on a successful Part IV claim, cannot bring a claim on behalf of the estate in his or her own name.[20] The issue raised in Wood v McLean was the meaning of ‘interest’, which was the real issue before the Court of Appeal.[21] Counsel submitted that a successful application to pass over the executor and for a limited grant would in effect give the plainfiff standing to challenge the transfer of the Altona North property. The present application was made to obtain standing.
[19] (2010) 31 VR 12.
[20] Transcript of Proceedings, Mataska v Browne (Supreme Court of Victoria, McMillan J, 5 October 2012) 12.
[21] The case settled before the appeal was argued.
Defendant’s Submissions
The plaintiff has adduced no evidence, only her own suspicions, that the registration of the Altona North property in the joint names of the deceased and the defendant was unlawful or liable in some way to be impugned.
The plaintiff cannot bring a proceeding in her own name to set aside the purchase of the Altona North property, as she is not a beneficiary in the deceased’s estate. The plaintiff has no rights to sue in the name of, or on behalf of, the estate, as she has no interest in it. A potential claim under Part IV of the Act is not a sufficient interest for this purpose. The decisions of Wood v McLean and Van Wyk v Albon[22] prevent the plaintiff from suing in her own name to undo the transaction she seeks to impugn. The plaintiff has no right to interfere in the administration of an estate in which she is not a beneficiary.
[22] [2011] VSC 120 (24 March 2011).
There is no basis upon which to pass the defendant over as executor of the estate and no basis upon which to appoint the plaintiff as administrator with the will annexed of the deceased’s estate. The right to pass over a named executor is only exercised in limited circumstances having regard to the interests of the persons beneficially entitled to the estate and its due administration.[23] Because the plaintiff has no interest in the deceased’s estate whatsoever, the law does not permit a person such as the plaintiff to obtain administration of an estate. There is an exception where all the beneficiaries are sui juris and consent, which is not the case here.
[23] LexisNexis Butterworths, Wills Probate and Administration Service, vol 1 (at Service 51) [28,150].
Principles Applicable to Passing Over an Executor
The jurisdiction of the Court to pass over an executor named in a will is usefully summarised in Re Estate of Crane[24] as follows:
First, it is clearly established that a court will not readily pass over a named executor and, in general, a person who is named as executor by a testator is entitled to a grant of probate. Section 67 of the Testamentary Causes Act refers to ‘special circumstances’ and the jurisdiction to pass over an executor is properly described as a limited jurisdiction. Secondly, when a court does exercise the jurisdiction it does so having regard to the due and proper administration of the estate and the interests of the parties beneficially entitled to the estate. Although the case was about the revocation of a grant, the decision of Jeune P in In the Goods of William Loveday [1900] P 154, 156, establishes that proposition.
[24]Re Estate of Crane (2005) 93 SASR 198, 203–4.
Re Estate of Crane sets out a large number of cases in England where an executor has been passed over or a grant of probate has been revoked as well as a number of Australian authorities.[25]
[25] Ibid 204–5.
Due and Proper Administration of the Estate
The factual basis for the plaintiff’s application are the circumstances surrounding the disposition of the deceased’s Newport property and the purchase of the Altona North property in the joint names of the deceased and the defendant. Prior to those transactions, the deceased’s 2004 will included both the plaintiff and the defendant as executors and beneficiaries in equal shares. In 2005, the deceased’s enduring power of attorney appointed both the plaintiff and the defendant as her [joint] donors under the power of attorney. By her 2009 will, the deceased excluded the plaintiff as an executor and a beneficiary, leaving everything to the defendant. By 2011, the deceased had, in effect, given away most of her estate to the defendant by providing all of the funds for the purchase of the Altona North property and registering it in the joint names of herself and the defendant.
All of these events occurred when the deceased would be considered to be elderly and where, in respect of the property transactions, her usual solicitors were not retained by her. For the purchase of the Altona North property, the deceased and the defendant retained the same solicitors.
Factual scenarios similar to the above have enlivened the exercise of the discretion of the Court to pass over a named executor. A like example was described in Re Estate of Crane. In that case, the deceased appointed his two sons as the executors of his estate and both were beneficiaries under his will. One of the executors sought orders that the other be passed over as an executor of the estate. The grounds for the application lay in three transactions that occurred shortly before the death of the deceased. The plaintiff asserted that the deceased had sold certain properties valued at approximately $400 000 and a caravan to the defendant for the sum of $100 each and also that the defendant owed the estate the sum of $150 000 relating to another transaction. It was asserted by the plaintiff that the first two transactions were legally ineffective on the grounds of undue influence or unconscionable conduct. It was also asserted that, because there was a dispute about the three assets that would only be resolved by legal proceedings, the defendant would have a conflict of interest and duty and should not be permitted to assume the office of executor of the estate.
In that case, his Honour held that the circumstances surrounding the three assets and their disposition required the ‘most careful investigation’.[26] He then applied the guiding principle of having regard to the due and proper administration of the estate and the interests of the parties beneficially entitled to the estate and said:
I must also recognise that the jurisdiction is limited and that, in general, [the defendant], as a person who is named as executor by the testator, is entitled to a grant of probate. I also recognise that, in the ordinary case, a potential conflict of interest will not be sufficient to justify the exercise of the jurisdiction. As Windeyer observed in Uniting Church in Australia Property Trust (NSW) v Millane, not infrequently an executor will have some conflict, such as being a debtor to the estate. However, … this is a different case (from that of an executor who has some conflict by reason of being a debtor to the estate). [The defendant] has made it clear that he maintains that the [first two] transactions … are legally effective and that he owes no money to the estate. There is every reason to think that he will continue to maintain that position until a court determines otherwise. If made an executor, I think that it can be said with a high level of confidence that he will not consent to the estate asserting rights in relation to the three assets. In that event, an application to the court for the estate to bring or defend proceedings would be almost inevitable.
… I emphasise that at this stage I am not determining the merits of the claims, but at the same time I have reached the conclusion that, on the face of it, the claims require careful investigation, and, as near as one can tell at this stage, litigation in relation to one or more claims is likely. In the particular circumstances of this case, I think the order sought should be made.[27]
[26]Ibid 205.
[27]Ibid 206–7.
In my view, the circumstances relied on by the plaintiff are such that, on the face of it, they merit ‘careful investigation’.
For the following reasons, it can be assumed that the defendant as executor will not undertake any investigation:
a) The defendant has not applied for a grant of probate and is unlikely to do so.
b) A grant of probate is not necessary for the finalisation of such a small estate.
c) The defendant maintains that:
i. the plaintiff has no right to interfere in the administration of the estate because she is not a beneficiary of the estate;
ii. the inter vivos transactions cannot be impugned; and
iii. she is not in a position of conflict.
As stated, generally, the Court assumes an executor will act properly in the discharge of his or her executorial duties.[28] It is not possible for the plaintiff to commence proceedings against the defendant on behalf of the estate without the consent of the defendant. The defendant is unlikely to give that consent.
[28] Re Ritchie; Uniting Church in Australia Property Trust (NSW) v Millane [2002] NSWSC 1070 (13 November 2002) [9].
The fact that there could be some conflict of interest, such as where an executor is a debtor to the estate, does not in itself justify passing over a named executor who wishes to take a grant.[29] In my view, the defendant is in a clear position of conflict between her duty to the estate and her personal interest. The defendant resists any claim to set aside the inter vivos transfer of the Altona North property, which would otherwise have formed the bulk of the deceased’s estate. It may be argued that, since the defendant is the only beneficiary of the deceased’s estate and therefore the only person to be affected by the setting aside of the impugned transfer, she cannot be in a conflict of interest. However, in my view, an independent administrator of the estate would consider that these very circumstances are of such a kind as to warrant ‘careful investigation’. As the registered proprietor of the Altona North property, she is in a direct conflict with her duty as the executor of the deceased’s estate.
[29] Ibid [8].
For these reasons, there is a live issue to be determined having regard to the due and proper administration of the estate. Further, the fact that the defendant has not sought and will not seek a grant of probate of the will of the deceased is a relevant matter to be taken into account in the exercise of the discretion of making the orders sought.[30]
[30]Hogarth v Johnson [1987] 2 Qd R 383, 387–8.
Standing of the Plaintiff
In support of the submission that the plaintiff does not have standing to apply either for a limited grant or for the passing over of the executor, the defendant relies on two recent Victorian decisions of single judges in this Court, namely, Wood v McLean and Van Wyk v Albon.
In Wood v McLean, Sifris J held that two plaintiffs who had made claims seeking provision under Part IV of the Act did not have standing to bring an action to set aside an inter vivos transfer by the deceased to their sister. His Honour found that the claim by the plaintiffs under Part IV of the Act was a contingent statutory claim and was not a sufficient interest to allow them to bring a claim on behalf of the estate against a third party. He found that, in order to bring their proceeding on behalf of the estate against a third party, the plaintiffs were required to demonstrate that they had a present or an actual existing interest; a mere possibility or even a probability of an interest was not sufficient. Leave to appeal was granted by the Court of Appeal.[31] In granting leave to appeal, the Court stated:
This appears to be a novel question and the parties have been unable to point to any direct authority one way or the other. … Of course, the applicants are not beneficiaries.
… Nevertheless, the question might be thought to arise as to whether, in all the circumstances, the applicants have a sufficient financial or economic interest, if no other, as to support a conclusion that they have standing to bring the proceeding. The possible relevance of what was said by Hargrave J in Russo v Russo as to parties with a ‘real financial interest’ having standing to apply for removal of an executor may also require to be considered. A subsidiary question might be thought to arise as to whether it would have been appropriate, rather than to permanently stay the proceeding, to defer the question of standing to the trial.[32]
[31]The proceeding settled before the appeal was heard.
[32]Wood v McLean [2011] VSCA 37 (18 February 2011) [7]–[8] (citations omitted).
In Van Wyk v Albon, in the context of an application for a grant of revocation of a grant of probate, Habersberger J adopted the reasoning in Wood v McLean.[33]
[33] [2011] VSC 120 (24 March 2011) [12].
Counsel for the plaintiff submitted that Wood v McLean is only applicable where the plaintiff seeks to bring an action on behalf of the estate in his or her own name. It does not preclude a finding that someone who does not have a present or an actual existing interest in the estate has standing to make an application for a limited grant or to pass over an executor.
In addition to the two Victorian decisions, the New South Wales decision of Re Culina; Poulos v Pellicer[34] held that a possible claim under the Family Provision Act 1982 (NSW) did not give rise in New South Wales to a sufficient interest to challenge a will, with the interest dependent upon order, not validity of the will.[35]
[34] [2004] NSWSC 504 (11 June 2004).
[35] Ibid [13].
In Re Culina; Poulos v Pellicer, the deceased left two wills. In the earlier will, the testator appointed her son as executor and left him the bulk of the estate. In the later will, the son remained executor, but the estate was left to the deceased’s niece. The son did not apply for a grant of probate of the later will. The niece therefore appointed Mr Poulos as her attorney to apply for a grant of letters of administration with the later will annexed. The defendant, Ms Pellicer, was the estranged wife of the son. She sought to defend the proceedings brought by Mr Poulos. Ms Pellicer was also engaged in property adjustment proceedings against the son in the Family Court, who had little by way of assets, unless the earlier will was proved. The question for the Court in this case was whether the estranged wife had an interest sufficient to entitle her to defend proceedings for a grant of letters of administration. The husband had no intention of making a claim for provision from his mother’s estate under her last will. Windeyer J held that the wife’s interest was too remote, so that the application for the grant in common form was likely to be successful.[36]
[36] His Honour also stated that this might not necessarily bring to an end the right of the defendant because, on the plaintiff’s submission, the Family Court could order assignment of the right to due administration to the defendant and then the defendant would be in a position to bring proceedings for revocation of any grant: ibid [26].
During the course of the judgment, Windeyer J set out some principles on the point of interest in estates, including, relevantly, that ‘[p]robate litigation is interest litigation. It is not to be undertaken or interfered in by outside busybodies’.[37] He also noted that ‘any interest or reasonable possibility of an interest, however remote, will be sufficient to entitle a person to become a party’.[38]
[37] Ibid [10].
[38] Ibid [11], citing Kipping v Ash (1845) 1 Rob Ecc 270; 163 ER 1035 and Baskomb v Harrison (1849) 2 Rob Ecc 118; 163 ER 1262.
In reaching the conclusion that a possible claim under the Family Provision Act 1982 (NSW) was not a sufficient interest to challenge a will, his Honour referred to the unreported decision of Arbuz v Sanderson.[39] In that case, the defendant lodged a caveat opposing an application for a grant of letters of administration. The grounds of the caveat stated her interest to be that she was ‘the former wife of the deceased and that she proposed to make a claim against the estate in accordance with the [Family Provision Act1982 (NSW)]’.[40] Waddell J stated:
Such an interest does not, in my opinion, support a caveat. It provides no ground on which the application for a grant might be refused. Indeed, the making of a grant is in the interests of such a caveator because it enables her to make her application under the [Family Provision Act1982 (NSW)].[41]
[39] (Unreported, Supreme Court of New South Wales, Waddell J, 24 March 1986) 1.
[40] Ibid.
[41] Ibid.
The contrary view was expressed in Hogarth v Johnson,[42] a unanimous decision of the Full Court of Queensland. In that case, it was held that the applicant, who claimed further and better provision from the deceased’s estate as an illegitimate son for whom no provision had been made, did have standing to bring an action against the executrix of the deceased’s estate.[43] The possibility that a Court might allow his claim for further and better provision out of the estate demonstrated that he had a prima facie interest in the estate.[44]
[42] [1987] 2 Qd R 383.
[43] Ibid 389.
[44] Ibid 390.
In Hogarth v Johnson, the illegitimate son sought declarations that the two wills of the deceased were invalid and that the deceased died intestate. The claim was brought against the executrix, who was also the sole beneficiary under the two wills, and the deceased’s next of kin, who did not defend the action. The son also claimed further and better provision for his maintenance and support from the deceased’s estate against the next of kin.
The Court held that the extent of the son’s interest related to the assets in the estate and would depend necessarily upon who might legitimately share in it. He, therefore, had a right to the determination of such questions as, amongst others, whether the lands subject to gift inter vivos to the first defendant formed part of the estate and who should administer the estate. In addition, Ryan J stated:
The appointment of a person by the court as the administrator of an estate makes that person the personal representative of the deceased but confers no relevant interest in his estate. It is otherwise, however, in relation to the possibility that the plaintiff may obtain an order in his favour under s 90 of the Succession Act 1867–77. Mortimer on Probate 2nd ed at 553 summarises the position as being that any interest however slight will suffice even it seems the bare possibility of an interest but some interest however remote there must be. Support for this will be found in Baskcomb v Harrison (1849) 2 Rob Ecc 118; 163 ER 1262, where it was decided that some interest however remote is necessary, and in Kipping & Barlow v Ash (1845) 1 Rob Ecc 270; 163 ER 1035 where it was held that the bare possibility of an interest is sufficient to entitle a party to oppose a testamentary paper. I regard the possibility that the court may, in its discretion, make such provision as it thinks fit out of the estate of the deceased for his child as conferring on him such an interest in the estate as will give him standing in this action. It is unnecessary for him for this purpose to set out facts in the statement of claim which would establish his entitlement to provision from the estate.[45]
[45] Ibid.
In a decision by Master T Connelly of the Supreme Court of the Australian Capital Territory, namely, the Re Estate of Aaldert van den Berg,[46] the Master dealt with an application to strike out objections to a caveat lodged in relation to a deceased’s will. The caveat was lodged by the son of the deceased on the grounds that he intended to file an application for further provision from the estate of the deceased. The matter arose because, prior to the death of the deceased, proceedings were brought in the Family Court by the deceased’s wife in relation to ownership of the family home. On the death of the deceased, the widow became the sole proprietor of the home as the surviving proprietor. The son sought to have a legal personal representative appointed to continue the Family Court proceedings to determine the appropriate interest held by the deceased in the home, so that this interest could be included in the estate of the deceased and that this question could be resolved before probate was granted. Thereafter he could bring his claim against the estate, comprising the deceased’s personal property and his interest in the home, rather than as it was presently inventorised, that is, with no interest in the matrimonial home. The son lodged the caveat to prevent the grant of probate pending his application for the appointment of an administrator ad litem to conclude the Family Court proceedings and determine the appropriate distribution between the deceased and his wife. The Master was satisfied:
if the grant of probate was to be made absolute the caveator’s interest could be adversely affected, as his claim for relief under the Family Provisions Act would be limited to the estate as inventorised, and would not include any possibility of a claim against the deceased’s interest in the matrimonial home. … I am satisfied that the caveator has shown that there is a reasonable prospect that he has an interest, which is, to paraphrase Wanstall J in In re Wood Deceased [1961] Qd R 585 at 589 ‘… certainly more than “the bare possibility of an interest” thought in Kipping and Barlow v Ash (1845) 163 ER 1035 to be sufficient to found opposition’.[47]
[46] [1999] ACTSC 82 (30 July 1999).
[47] Ibid [18].
The cases referred to demonstrate that views differ as to whether a claim by a plaintiff seeking further and better provision from a deceased’s estate is a sufficient interest to justify a finding that he or she has an interest in the estate.
The factual scenarios in the above cases differ: some relate to the standing of a caveator to lodge a caveat against a grant of probate or letters of administration or revocation of a grant of probate. However, the principles applicable to the standing of an applicant to lodge a caveat; to revoke a grant of probate; or to sue on behalf of the estate are, in my view, similarly applicable in an application to pass over an executor or for a limited grant. Namely, an applicant must establish that he or she has standing by virtue of having an interest in the estate of the deceased.
In my view, the narrow construction of Wood v McLean advocated by counsel for the plaintiff,[48] even if it were accepted, does not dispose of the question of standing. As Windeyer J stated in Re Culina; Poulos v Pellicer, ‘[p]robate litigation is interest litigation. It is not to be undertaken or interfered in by outside busybodies’.[49] Whether the application is to challenge a transfer on behalf of the estate in one’s own name, as in Wood v McLean, or to seek a limited grant and to pass over the executor, as here, the plaintiff must demonstrate an interest sufficient to give her standing. It cannot be disposed of by considering only the due and proper administration of the estate. It is therefore necessary to determine whether, in the circumstances, the plaintiff’s contingent Part IV interest in the estate affords her standing to seek a limited grant and the passing over of the executor.
[48] See above para 38.
[49] [2004] NSWSC 504 (11 June 2004) [10].
In my view, where a successful claim is made by an applicant under Part IV of the Act, that is, where a court is satisfied that an obligation under s 91 of the Act exists and was not met by a testator, the order for provision that the court makes operates as though it were a codicil to the will of the deceased person executed immediately before his or her death and the probate parchment is amended accordingly.[50] The consequence is that an applicant becomes a beneficiary of the estate, in effect, at the death of the testator.
[50]Administration and Probate Act 1958 s 97(4).
Plainly, it is not the case that anyone who contemplates a Part IV claim has an interest sufficient to interfere in the administration of an estate. However, in the present circumstances, there are strong grounds upon which to conclude that the plaintiff has a prima facie case for further provision from the estate.[51] In a claim made by an adult daughter for whom no provision has been made, in my view, there is a prima facie presumption that a deceased did have a responsibility to make provision for her. Such an applicant, without more, has a prima facie interest in the estate of a deceased.
[51] However, the plaintiff need not set out to prove those facts at this stage.
As to whether such an interest is sufficient to give standing to the plaintiff to seek a limited grant of administration, given my opinion that the test for standing to sue in one’s own name and to seek a limited grant are the same, namely that the plaintiff has a sufficient interest in the estate, I respectfully disagree with the reasoning of Sifris J in Wood v McLean and follow the reasoning of the Full Court in Hogarth v Johnson.[52]
[52] The relevant principles on the point of judicial comity are succinctly set out by Bell J in Shaw v Yarranova Pty Ltd [2006] VSC 45 (23 February 2006) [66]–[68].
Although it is correct to say that, at the time of the application before me, the plaintiff does not have a present interest or an actual existing interest in the estate, the fact that her Part IV claim, which would entitle her ultimately to be a beneficiary of the estate as at the death of the deceased, could be said to have a reasonable prospect of success suggests that she has a prima facie interest in the estate of the deceased. In that sense, she has a sufficient interest in the administration of estate. In my opinion, the principle enunciated by Sifris J in Wood v McLean, that a contingent interest cannot constitute a sufficient interest, is too broadly stated. A contingent Part IV interest, without more, is insufficient to support standing. In certain cases, however, as in Hogarth v Johnson and Estate of Aaldert van der Berg, the reasonable prospect of a successful Part IV claim will suffice to give standing.
In my view, I consider that the authorities to which I have referred support the view that a ‘reasonable possibility of an interest‘[53] exists for the plaintiff and is sufficient to justify concluding that she has standing. It is moreover sensible that the determination of the composition of the estate should precede the question whether the plaintiff has received adequate compensation from it.[54]
[53]Re Culina; Poulos v Pellicer [2004] NSWSC 504 (11 June 2004) [11].
[54]Re Davis, deceased; Davis v McEachern [1952] VLR 517, 518; Hogarth v Johnson [1987] 2 Qd R 383, 388.
Conclusion
The extent of the plaintiff’s interest in the estate in any Part IV claim relates to the assets in the estate of the deceased and, as stated, my view is that the circumstances relied upon by the plaintiff demonstrate that there should be a ‘careful investigation’ as to whether the inter vivos transactions should form part of the estate. The defendant, for the reasons set out, will not undertake that investigation.
Accordingly, having regard to the due and proper administration of the estate; the interests of those beneficially entitled to the estate; and the interests of the plaintiff in the estate of the deceased, I am satisfied that a limited grant of administration should be made in this matter and that the plaintiff has standing.
I will hear the parties as to the form of order, the appropriate person to be appointed as administrator and costs. Otherwise, I dismiss the defendant’s summons filed 27 September 2012 to dismiss the proceeding.
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CERTIFICATE
I certify that this and the 17 preceding pages are a true copy of the reasons for Judgment of Justice McMillan of the Supreme Court of Victoria delivered on 14 December 2012.
DATED this 22nd day of February 2013.
Associate
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