Neil Ronald Telfer as Executor for the Estate of the late Lyall Telfer v Carolyn Telfer (No. 3)

[2013] NSWSC 1614

Supreme Court

New South Wales

Medium Neutral Citation:	Neil Ronald Telfer as Executor for the Estate of the late Lyall Telfer v Carolyn Telfer (No. 3) [2013] NSWSC 1614
Hearing dates:	4 November 2013
Decision date:	04 November 2013
Jurisdiction:	Equity Division
Before:	Slattery J
Decision:	The administration of the estate of Lyall Vincent Telfer granted to Mr Kenneth John Fairfax.
Catchwords:	SUCCESSION - wills, probate and administration - NSW Trustee and Guardian previously appointed by the Court as administrator of the estate pursuant to NSW Trustee and Guardian Act 2009, s 22 - further litigation in relation to the administration of the estate likely - NSW Trustee and Guardian now seeks to set aside its appointment - if the NSW Trustee and Guardian's motion is successful the defendant seeks to appoint - an independent solicitor as the administrator - whether NSW Trustee and Guardian's appointment is unsuitable. COSTS -motion seeking appointment of an administrator opposed by the plaintiff -administrator appointed - whether costs should follow the event.
Legislation Cited:	Family Provision Act 1982 NSW Trustee and Guardian Act 2009, s 22(1)(b) Succession Act 2006 (NSW)
Cases Cited:	Firns v Firns [2000] NSWSC 396 Neil Ronald Telfer as Executor for the Estate of the late Lyall Telfer v Carolyn Telfer [2013] NSWSC 412 Neil Ronald Telfer as Executor for the Estate of the late Lyall Telfer v Carolyn Telfer (No. 2) [2013] NSWSC 823 Telfer v Telfer [2013] NSWCA 330
Category:	Separate question
Parties:	Plaintiff/Cross Defendant:- Neil Ronald Telfer as executor of the estate of the late Lyall Telfer Defendant/Cross Claimant:- Carolyn Telfer
Representation:	Counsel: Plaintiff/Cross Defendant:- M. K. Rollinson Defendant/Cross Claimant:- C. Carroll NSW Trustee and Guardian:- L. Ellison SC Solicitors: Plaintiff/Cross Defendant:- Benjamin Barrack, Barrack Lawyers Defendant/Cross Claimant:- Denis Williams, Whitehead Copper Williams NSW Trustee and Guardian:- Ms Ruth Pollard
File Number(s):	2011/283114
Publication restriction:	No

EX TEMPORE Judgment

1. This is my third judgment in these strongly contested proceedings. In the Court's first judgment on 24 April 2013 the Court found that the plaintiff, Mr Neil Telfer, had not established that a 17 February 2011 codicil to the will of the deceased was properly executed in accordance with Succession Act 2006, s 6, and the Court made directions in relation to remaining issues: Neil Ronald Telfer as Executor for the Estate of the late Lyall Telfer v Carolyn Telfer [2013] NSWSC 412.

1. In the Court's second judgment on 14 June 2013 the Court found that Mr Neil Telfer was not entitled to proceed to take probate of the will of the deceased and the Court dealt with issues of the costs of the proceedings: Neil Ronald Telfer as Executor for the Estate of the late Lyall Telfer v Carolyn Telfer [2013] NSWSC 412; Neil Ronald Telfer as Executor for the Estate of the late Lyall Telfer v Carolyn Telfer (No. 2) [2013] NSWSC 823.

1. At the time of giving the second judgment, the Court did not determine who in place of Mr Neil Telfer should proceed to take probate. Rather, the Court made an order that the President of the Law Society of New South Wales should nominate a person suitable to act as the administrator of the estate.

1. This third judgment concerns an ongoing dispute about the working through of that order since 21 June 2013. This judgment should be read with the Court's previous judgments. Persons, events and things are referred to in all three judgments in the same way.

1. Since the Court's earlier judgments Mr Neil Telfer has sought leave to appeal to the Court of Appeal, which was the subject of a judgment of Meagher JA on 30 September 2013: Telfer v Telfer [2013] NSWCA 330. I am told the matter is listed before the Court of Appeal for hearing of both the leave application and the appeal in February next year.

1. The Court has two motions before it, one by the NSW Trustee and Guardian, the other by Carolyn Telfer. The background to these motions is that the President of the Law Society found himself unable to nominate a person suitable to act as the administrator of the estate in accordance with order four of the Court's orders of 14 June 2013. Despite his considerable efforts in that direction the President of the Law Society, Mr John Dobson was unable to find a private legal practitioner willing to take on the role of the administration of the estate. So in the end he nominated the NSW Trustee and Guardian. As a result, on 19 August 2013 I made orders under NSW Trustee and Guardian Act 2009, s 22(1)(b), granting administration of the estate of Lyall Vincent Telfer to the NSW Trustee and Guardian ("NSW Trustee").

1. The NSW Trustee now moves to set aside that order. Carolyn Telfer's motion is only moved on in the event that the NSW Trustee's motion is successful. Carolyn seeks in her motion that a grant of Letters of Administration of the June 2010 will of Lyall Telfer be made to Kenneth John Fairfax, a solicitor of this Court who is an accredited estate and succession law specialist and who practices in the Parramatta district, not far from where the Northmead property is located. She neither supports nor opposes the NSW Trustee's motion. Mr Neil Telfer opposes both the orders sought by the NSW Trustee on its motion and the orders sought by Carolyn Telfer. In the result, as these reasons show the Court has decided that it will accede to the NSW Trustee's motion and to Carolyn Telfer's motion for the appointment of Mr Fairfax.

1. The NSW Trustee's case supported by, as it is by an affidavit of Ms Pollard, makes clear the reasons why the NSW Trustee regards its appointments as trustee to be unsuitable, and it wishes to decline the appointment.

1. The arguments the NSW Trustee puts for the declining of the appointment appear to me to be persuasive. In short, Ms Pollard says in her evidence that the NSW Trustee does not have a policy which allows for general revenue in the estates it administers to subsidise private estates and protracted intra-family litigation such as that which can be anticipated in the present matter. She points out the NSW Trustee and Guardian is largely self-funding, apart from a small community service obligation payment by the government to cover the cost of small estates and trusts, and is required by government to make budgetary savings.

1. This government payment is not a fund available to fund litigation between family members. It is to sustain a fund to assist in administration of small non-litigious estates. That evidence and the submissions put on behalf of the NSW Trustee by Mr Ellison SC point to the role of the NSW Trustee in essentially uncontentious administration. When it is involved in litigation it is as a defendant in Family Provision Act litigation or a claimant or a cross-claimant in relation to issues concerning informal testamentary instruments or issues of testamentary capacity associated with estates in which it has been appointed a named executor under a will. Under its guardianship role it is the default appointee as guardian, but is not the default appointee in relation to estates such as the present one.

1. When the President of the Law Society, in exercise of the Court's previous orders, could not find a private solicitor to act as an administrator of this estate, Mr Dobson, reported to the Court that he had nominated the NSW Trustee. The NSW Trustee indicated at that time to the President that it was unwilling to take on the office. But on 19 August 2013 the Court was faced with a situation in which there was no-one else who the President had found who was prepared to take on the office of administrator of this estate, and who's appointment was unlikely to provoke further litigation. So the Court proceeded, pursuant to NSW Trustee and Guardian Act, s 22 to make the appointment of the NSW Trustee.

1. There is an interesting question of law whether the NSW Trustee's capacity to decline an appointment under the NSW Trustee and Guardian Act, s 13 operates in the field of the Court's capacity to appoint under s 22. That is not a question that I have to decide in this case. It seems to me to be quite clear that in the circumstances of this particular estate where the Court has the NSW Trustee saying it wishes not to have this role, and there is now a private individual who is willing to take it on, that in the Court's discretion what should happen is the order should be set aside and the private individual appointed.

1. The NSW Trustee's reservations about taking on this job are well-founded. It can be anticipated that from the course of the contest which has already taken place in these proceedings, and from the extensive correspondence which foreshadows issues about future administration, that there will be a vigorous and aggressive contest in relation to the administration of this estate. As Young J observed in Firns v Firns; Estate of Ronald Douglas Firns [2000] NSWSC 396 at [8] - [11], where it can be anticipated that investigation or litigation is likely to occur, the administration of an estate, the appointment of in that case the Public Trustee, now the NSW Trustee, may be less appropriate than the appointment of a private individual.

1. The evidence adduced by the NSW Trustee through Ms Pollard is to the effect the following can be anticipated. Carolyn Telfer will dispute the validity of the contract for sale of the Northmead property, between the testator and his son Mark. I leave aside whether that will also involve any issue about vacant possession. There is likely to be argument about whether Mark should pay an occupation fee for his continued occupation of the Northmead property which may need to be the subject of proceedings.

1. Carolyn Telfer claims a debt of between $400,000 and $500,000, which she said is secured, not by a registered mortgage but by provisions of a deed. The liability for that debt and its quantum may need to be the subject of court proceedings.

1. There is a real prospect that the estate will be insolvent, for the reasons already stated in the Court's principal judgment. The proceedings are now in the Court of Appeal. Depending on the outcome of that case, if Mr Neil Telfer is successful, he will remain a party to these proceedings and may remain the executor of the estate. Further litigation is even possible, if he is unsuccessful in the Court of Appeal.

1. Ms Telfer has already incurred substantial costs. It seems to me that all of the reasons that Ms Pollard advances are good reasons for the NSW Trustee to decline to administer this estate.

1. Mr Rollinson on behalf of Neil Telfer argues that the NSW Trustee, is taking a somewhat exaggerated view of the difficulties that will be involved in the administration of the estate. He submits that the NSW Trustee's adverse attitude to this appointment has been contributed to by the way that the solicitors acting on behalf of Carolyn Telfer have corresponded with the representatives of the NSW Trustee.

1. I do not find that argument persuasive. Most, if not all, of the matters raised by Ms Pollard appear to me to be contests which are well and truly on the cards in this litigation in the future. Any reasonable person reading the unnecessary, prolix and aggressive correspondence in this case could be excused for taking the same view.

1. The full detail of the NSW Trustee's objection to acting was not before the Court when it made the previous orders. Now that the material has been put before the Court, this seems to me to be a case where, on this new material, that the order I made should be set aside and I will so do so.

1. I now move to Carolyn Telfer's motion for the appointment of Mr Fairfax. In the alternative Mr Carroll on behalf of Carolyn Telfer says that if Mr Fairfax were not to be found suitable, that the matter should be referred again to the President of the Law Society for him to select someone else. That is, in short, what Mr Rollinson also says should now happen. So that the contest to which the Court moves is Mr Carroll first contending that Mr Fairfax should be appointed and Mr Rollinson's contending that the matter should go back to the President of the Law Society.

1. Although the precise reasons are not recorded in my second judgment, Mr Rollinson is right, the reason that the President of the Law Society was appointed to nominate a person for the Court to appoint as executor, was that it was desirable that someone who had not already been contacted and dealt with by either party (but who would be dealt with through a neutral person such as the President of the Law Society), would be a more desirable appointee as a administrator. This was to avoid the perception by one or other party that the appointee was in the camp of the other party by reason of such early contact.

1. A number of factors incline me to reject Mr Rollinson's arguments and prefer the arguments of Mr Carroll on this question. The first of these is the interest in the good and efficient administration of this estate. This estate needs an administrator now. The Court gave its first judgment in April, its second judgment in June. It appointed a NSW Trustee in August. It is now 4 November. There are still many unresolved issues in the administration of this estate, which are quite independent of the dispute that have so far occupied the Court. They should in my view be attended to as soon as possible. To accede to Mr Rollinson's submission that the matter go back to the President of the Law Society would not pay proper regard to the need for efficient administration of this estate.

1. Secondly, it would appear to be a futile course. There is no evidence that the President of the Law Society will is likely to do any better now to find an independent administrator than he did on the last occasion, after the Court's 21 June orders.

1. Thirdly, Mr Rollinson says that the problem with Mr Fairfax is that he has been found through Mr Williams. But that fact alone does not seem to me to be a proper basis to maintain an objection to Mr Fairfax. Mr Williams explains how he made contact with Mr Fairfax, who he plainly does not know personally. Mr Williams found him by searching the Law Society Accredited Specialist website looking for a relevant accredited specialist in Parramatta. He found that Mr Fairfax was the only accredited specialist in wills and estates practising in that area. And he then wrote on 17 October 2013 to Mr Fairfax a letter which, in my view, is quite unexceptionable in content. He received a phone call from Mr Fairfax to say that Mr Fairfax was prepared to accept appointment as administrator. Mr Fairfax then swore the affidavit in these proceedings that he has as to his fitness and willingness to act as administrator.

1. Mr Rollinson has not chosen to cross-examine Mr Williams. Nor has he asserted any impropriety about Mr Williams' contact with Mr Fairfax which was clearly quite limited. I am not persuaded by any argument that one solicitor of this Court contacting another in these circumstances, so the second can be appointed as an administrator of an estate, is any basis in itself not to appoint the second person.

1. Mr Rollinson rightly does not challenge Mr Fairfax's independence in acting. It seems to me there can be no proper basis for not appointing him merely because Mr Williams has made first contact with him. If this were not so, the doing of ordinary business in relation to estates and trusts in this division of this Court would be severely constrained.

1. I will, therefore, make the order sought and appoint Mr Fairfax as the administrator of the estate in accordance with order one of Ms Carolyn Telfer's motion.

1. The parties talked about giving various undertakings at this time about aspects of the future administration of the estate. But it seems to me better to grant the parties, including the administrator of this estate liberty to apply in relation to the implementation of these orders. If any issues arise, they can be brought back to me.

Costs

1. Mr Carroll seeks costs of the motion. Mr Rollinson submits that each party should bear their own costs.

1. I had initially thought that acceding to Mr Rollinson's submission might be the best way of discouraging the parties to these proceedings from engaging in prolix and aggressive correspondence. But on further reflection it seems to me that the essential contest this morning has been occasioned by Mr Neil Telfer's opposition to both the NSW Trustee's and Carolyn Telfer's motions. The NSW Trustee's position is it does not seek costs, provided no-one seeks costs against it. I propose to make no costs order either in its favour or against it on its motion.

1. As to Carolyn Telfer's motion, Mr Carroll made clear that Ms Carolyn Telfer was not opposing the NSW Trustee's motion. The essential contest has been one between Mr Neil Telfer and Ms Carolyn Telfer about what should happen if the NSW Trustee were no longer the administrator of the estate. On that Mr Neil Telfer has lost. It seems to me that costs should follow the event. Approximately two hours of today would not have been occupied, if this had not been opposed by Mr Neil Telfer.

1. Accordingly, I will make an order for costs on Carolyn's motion against Neil Telfer. But there are two qualifications. The first one is that Mr Neil Telfer asks that there be excluded from that costs order costs associated with responding to a notice to produce issued by Carolyn Telfer's solicitor, Mr Williams, on 30 October 2013, seeking a conveyancing file and correspondence relating to the conveyancing file for the contract for the sale of the Northmead property dated 31 March 2011 between the deceased and Mr Mark Telfer. That is not opposed by Mr Carroll.

1. Secondly, Mr Rollinson has properly conceded that neither the costs order that is to be made against Mr Neil Telfer, or Mr Neil Telfer's costs of the motion are or could be characterised as administration expenses for which he could seek indemnity from the estate. It is, therefore, not necessary for me to make any further order in that regard.

Conclusions and Orders

1. Accordingly, the Court makes the following orders and directions:-

(1) Order 2 of the orders made in these proceedings on 19 August 2013 be set aside.

(2) The administration of the estate of the Lyall Vincent Telfer is granted to Mr Kenneth John Fairfax.

(3) No order as to costs on the NSW Trustee's motion, to the intent that the NSW Trustee and Guardian and other parties to that motion will bear their own costs of these proceedings.

(4) The plaintiff to pay the defendant' costs of the defendant's motion, excluding costs of and incidental to her notice to produce dated 30 October 2013.

(5) Liberty to apply to the parties and to the administrator, Mr Fairfax.

(6) Proceedings to be referred to the Registrar in Probate so that Mr Fairfax can attend to compliance with Court rules in relation to the grant of administration.

**********

Decision last updated: 06 November 2013