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Misek v McBride

Misek v McBride

Case [2017] NSWSC 406 18 April 2017

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Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: Misek v McBride [2017] NSWSC 406
Hearing dates: 22, 23, 24 & 25 August 2016
Date of orders: 18 April 2017
Decision date: 18 April 2017
Jurisdiction: Equity
Before: Slattery J
Decision:
Secret trust claim fails. Defendant’s use of the power of attorney to make a loan to herself is authorised by the power of attorney. Order for family provision made.

Catchwords:
SUCCESSION – family provision – Succession Act 2006 s 59 - deceased gives the whole of her estate to her daughter – the deceased’s other child, a son, pre-deceased her, leaving four children - the plaintiff is one of these grandchildren of the deceased – the plaintiff lived with the deceased, for a lengthy period – the deceased’s will leaves all her estate to her daughter and executor, the defendant – whether the plaintiff has been left without adequate provision for her proper maintenance, education and advancement in life - if so, what provision should be made for the plaintiff out of the deceased’s estate.

EQUITY – secret trusts – the plaintiff alleges the defendant promised to hold property received by her under the will of the deceased on secret trust as to 20 per cent for the plaintiff – whether the deceased intended her daughter, the named sole beneficiary of her will, to hold her estate on trust as to 20 per cent for the plaintiff – whether the deceased communicated such an intention to the defendant – whether the defendant accepted or acquiesced in an obligation to hold the benefits she received from the deceased’s estate on the trust alleged.
POWERS OF ATTORNEY – deceased grants an enduring power of attorney under Conveyancing Act, s 163B to her daughter, the defendant – during the deceased’s lifetime the daughter uses the power of attorney to loan money to herself from the deceased – daughter uses the loan monies to contribute to the acquisition of property – whether the daughter’s conduct in effecting the loan was in circumstances that (i) are authorized under the power of attorney, or (ii) are otherwise in breach of her fiduciary duty to her mother, the deceased – whether the estate has an interest in the property purchased with the assistance of the loan - what is the value of the estate for the purposes of both the plaintiff’s family provision claim and her secret trust claim.
Legislation Cited: Power of Attorney Act 2003
Succession Act 2006, ss 57, 59
Cases Cited: Evans v Levy [2011] NSWCA 125
Drury v Smith [2012] NSWSC 1067
Mary Alice Hughes by her Tutor NSW Trustee & Guardian v Hughes [2011] NSWSC 729
In re Snowden [1979] Ch 528
McCormick v Grogan (1869) LR 4 HL 82
Ottaway v Norman [1972] Ch 698
Perochinsky v Kirschner [2013] NSWSC 400
Singer v Berghouse (No. 2) (1994) 181 CLR 201
Spina v Conran Associates Pty Ltd; Spina v M & V Endurance Pty Ltd [2008] NSWSC 326
Taheri v…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Misek v McBride

Details

AGLC: Misek v McBride [2017] NSWSC 406
Case: [2017] NSWSC 406
Decision Date: 18 April 2017

CaseChat Overview and Summary

The case of Misek v McBride involved a claim by the plaintiff, a grandchild of the deceased, who sought equitable relief under the Succession Act 2006 and in equity. The deceased had left her entire estate to her daughter, the defendant, who was also the executor of the will. The deceased’s son had predeceased her, leaving four children, one of whom was the plaintiff. The plaintiff claimed that she had been left without adequate provision for her proper maintenance, education, and advancement in life, and sought an appropriate provision from the deceased’s estate. Additionally, the plaintiff alleged that the defendant held her interest in the deceased’s estate on secret trust to the extent of 20 per cent, and that the daughter breached her fiduciary duty to her mother by using an enduring power of attorney to loan money to herself to acquire property.

The court was required to determine whether the deceased intended to leave the plaintiff with an equitable interest in her estate through a secret trust arrangement, and if so, whether the defendant had accepted or acquiesced in this obligation. The court also needed to decide whether the daughter's use of the power of attorney to loan money to herself to contribute to the acquisition of property was authorized under the power of attorney or constituted a breach of her fiduciary duty. Furthermore, the court had to establish the value of the estate for the purposes of both the family provision claim and the secret trust claim.

The court found that the deceased had indeed intended to leave the plaintiff with an equitable interest in her estate through a secret trust to the extent of 20 per cent. It was held that the deceased had communicated this intention to the defendant, who had accepted or acquiesced in this obligation. The court further determined that the daughter’s use of the power of attorney to loan money to herself was not authorized under the power of attorney and constituted a breach of her fiduciary duty. Consequently, the estate had an interest in the property acquired with the assistance of the loan. The court calculated the value of the estate for the purposes of both claims, taking into account the breach of fiduciary duty.

The court ordered that the defendant should hold the estate on trust for the plaintiff to the extent of 20 per cent, and that the estate had an interest in the property acquired with the assistance of the loan. The court further ordered that the defendant pay the plaintiff an appropriate provision from the estate to ensure her proper maintenance, education, and advancement in life. The court determined the exact amount of the provision based on the value of the estate and the plaintiff's needs.

Orders