McGuigan v Public Trustee

[2001] NSWSC 602

CITATION:	McGUIGAN v PUBLIC TRUSTEE [2001] NSWSC 602
CURRENT JURISDICTION:	Equity Division
FILE NUMBER(S):	SC 2913 of 2000
HEARING DATE(S):	28 June 2001
JUDGMENT DATE:	28 June 2001
PARTIES :	COLLEEN JEAN McGUIGAN v PUBLIC TRUSTEE
JUDGMENT OF:	Master Macready at 1

COUNSEL :	Mr J.R. Wilson for plaintiff Mr L. Ellison for defendant
SOLICITORS:	Gibson Owen Lawyer for plaintiff Public Trustee for defendant
CATCHWORDS:	Family Provision. Application by a daughter. Whole estaqte passes to a son. Orders for legacy made. No matter of principle.
DECISION:	Paragraph

- 1 -

1 MASTER: This is an application under the Family Provision Act in respect of the estate of the late Percival Thomas Griffiths who died on 28 November 1999. He is survived by two children, William Griffiths, and the plaintiff Colleen Jean McGuigan. The deceased's wife had pre-deceased him.

2   The deceased made his last will on 15 July 1981. Under his will he appointed the Public Trustee as executor and he left his estate to his wife, Jean Griffiths, provided she survived him by thirty days. As I have mentioned she had pre-deceased him, and the substitution gift was in favour of the son, William Griffiths.

3   The deceased left an estate which comprised a home unit at Randwick which is estimated at a value of $400,000 and bank accounts which now have been realised and are in the amount of $19,526.

4   There have been a number of costs incurred in the matter. The defendant's costs will amount to some $12,000 and those of the plaintiff $18,195, a total of $30,195. There is also commission which will have to be paid of some $10,000. Effectively, cash will have to be found in excess of the cash in the estate in the order of $20,000.

5   I will just briefly deal with some of the chronology. Mr Griffiths, the deceased's son, was born on 31 December 1944, the plaintiff on 10 September 1951. The plaintiff married in 1972 and she had two children by that marriage who were born in 1976 and 1978. In 1981 the deceased made his will.

6   In 1991 the plaintiff and her husband, Kevin McGuigan, separated. They were then living in Coffs Harbour. The next year the plaintiff returned to Sydney and she obtained work as a legal secretary. She obtained a law qualification in due course in 1995. Her daughter, Karen, at that stage lived with her and during this period Karen was diagnosed with schizophrenia.

7   In June 1995 the plaintiff purchased her unit at Mount Street, Coogee, for $230,000. She had cash for most of the purchase price from the property settlement and she borrowed $15,000 from her brother, William.

8   Having not been able to set herself up in private practice at law, she went into various government departments in 1998. Her mother died in November of that year. In June 1999 Karen, the plaintiff's daughter, moved out into separate accommodation. The deceased died, as I have mentioned, in November 1999, and these proceedings were commenced within time.

9   The plaintiff, in January 2000, obtained work with the Department of Industrial Relations, a position which she still holds.

10 In applications under the Family Provision Act the High Court has recently in Singer v Berghouse [1994] 181 CLR 201 set out the two stage approach that a Court must take. At page 209 it said the following:

"The first question is, was the provision (if any) made for the applicant 'inadequate for (his or her) proper maintenance, education and advancement in life'? The difference between 'adequate' and 'proper' and the inter-relationship which exists between 'adequate provision' and 'proper maintenance' et cetera were explained in Bosch v Perpetual Trustee Company Co Limited. The determination of the first stage in the two-stage process calls for an assessment of whether the provision (if any) made was inadequate or what, in all these circumstances, was the proper level of maintenance et cetera 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.

The determination of the second stage, should it arise, involves similar considerations. Indeed, in the first stage of the process, the Court may need to arrive at an assessment of what is the proper level of maintenance and what is adequate provision, in which event, if it becomes necessary to embark upon the second stage of the process, that assessment will largely determine the order which should be made in favour of the applicant. In saying that, we are mindful that there may be some circumstances in which a Court could refuse to make an order notwithstanding that the applicant is found to have been left without adequate provision for proper maintenance. Take, for example, a case like Ellis v Leeder where there were no assets from which an order could reasonably be made and making an order could disturb the testator's arrangements to pay creditors."

11   I turn to consider the plaintiff's situation. She is forty-nine years of age and is separated from her husband. Although she has two children, they are not dependent on her and the plaintiff keeps in touch, on a very regular basis, with her daughter Karen who seemed to stabilise in the last few years in respect of her medication for schizophrenia.

12   The plaintiff is employed in the Department of Industrial Relations. She owns her unit at Coogee, which is worth $364,000. She has bank accounts of $36,474 and an investment in investment trusts of $2,068, an interest in the first Superannuation Scheme of $25,654, and a 1994 Laser, worth almost nothing, NRMA shares worth $2,479, and another bank account with $10,368 in it.

13   Her superannuation was the subject of cross-examination and it seems that the plaintiff is able to save from her wage each week a little under $200, which she puts into her superannuation. She intends to do this to build up her security and that, together with her employer contributions, is likely to mean that the total contribution by the time she is sixty will be at least $150,000. Her interest may be greater given what interest might be earned on that sum.

14   The plaintiff's fortnightly pay on a net basis is, after allowing for superannuation, union fees and income tax, $1,162. She apparently can comfortably manage on that income as her savings seem to have increased over the last year by about $10,000. It is also necessary to take into account the situation of others having a claim on the bounty of the deceased. In this case that is the plaintiff's brother William.

15   He has sworn an affidavit in this matter in which he has set out his situation. For many years he worked as an accountant with the local council and he retired in 1996. His assets are, firstly, two units in Strata Plan 8261 worth $800,000, term deposits of about $94,000, shares of $6,600, a current bank account of $29,800 and a superannuation account in which his superannuation is invested, amounting to $1.4 million.

16   He lives in the deceased's house and, indeed, he has spent the whole of his life living with his parents until they died. He used to contribute to the costs there. His current income situation is that he has a gross income of about $30,000 per year. His actual outgoings, including food and contributions he has to make, come to some $14,820. Clearly he is able to live comfortably on his self-funded income which has stabilised over the last few years.

17   It is clear that both the plaintiff and the defendant had a good relationship with their parents and there was nothing to suggest to the contrary. The plaintiff did receive some contributions. She was lent money which she repaid, to help buy her home unit. She had a gift of $5,000 from the deceased in 1985. She had some other gifts of $4,000 which was used to meet some expenses she had.

18   It is necessary to see how the plaintiff says that she has been left without adequate and proper provision for her maintenance, education and advancement in life. In her first affidavit she expressed a desire to look after her daughter Karen, but could not specify any particular help that Karen then needed, other than to suggest she might want to purchase a larger unit.

19   Her most recent affidavit has set out a series of matters that she would like to attend to in her unit, which is somewhat old, and also a number of other matters. She wishes to spend $30,478 in upgrading a car, which is probably well due for upgrading, given its current value. She is reluctant to take the current car on long trips because of its age.

20   There are some matters which she wants to do by way of renovation to the kitchen, bathroom and carpets, which are in the order of some $27,000, and there are also a series of other expenditures on white goods in the house, which ultimately would bring these quantifying needs up to some $65,000.

21   There is some criticism of her desire in this regard on several bases. Firstly, it is suggested the quotes that she had were for top of the range items. Certainly, that is not the case with the car, and so far as the white goods are concerned it is probably false economy to do otherwise. The other factor of criticism was that in fact the plaintiff has funds from which she can attend to most of these matters, at least over time.

22   The plaintiff's case was put on the basis that she really needed some fund to preserve her situation in her retirement. At this stage, although some people within her department have been made redundant, she has no knowledge of her position being so affected. It was suggested in submissions that she should receive a legacy of about 50 per cent of the estate, in the order of some $190,000. That submission was not put on the basis there should be an equal division between the plaintiff and the defendant, because that is what this Court, of course, cannot do. It has to consider the needs that are advanced or, using the words of the statute, the way the person has been left without adequate and proper provision.

23   The concerns of the plaintiff are really for security. She has adequate income at the moment and is able to save. There is not a need for maintenance. Accordingly, it is really some advancement in life which she seeks.

24   The problem is that there is little evidence about what the plaintiff's situation might be when she does retire and the Court is left in the realm where it is really being asked to speculate on the future. I do not have evidence of life expectancies and what might be the income or expenses of the plaintiff in due course and what might be expected to be earned on her superannuation if that were predictable with any certainty.

25   Certainly, I think that the plaintiff has reached an age in life where she needs to be concerned for her future. She needs to have some money behind her. These matters become important because she and her brother are advancing in years and both need some cash funds readily available if some unforeseen contingency befalls them.

26   Certainly, to obtain things like the items that the plaintiff wishes to do to the house are realistic, and it might be the only opportunity which she has to do that because this may be the only opportunity she has to receive some further capital sum.

27   In the circumstances it seems to me that some reasonable legacy is appropriate. I am reluctant to disturb the defendant's occupation of the house where he has lived all his life and to put him into a situation where he needs to sell it. Accordingly, I think it is appropriate that the plaintiff receive a modest legacy of more than the defendant suggests.

28   Accordingly, the orders I make are that the plaintiff receive a legacy out of the estate of the deceased in the sum of $75,000. I order the plaintiff's costs on a party party basis, the defendant's on an indemnity basis to be paid or retained out of the estate of the deceased. Interest is to run at the Wills Probate and Administration Act rates if the legacy is not paid by 1 September 2001. Exhibits may be returned.

Last Modified: 07/26/2001