New South Wales Institution for the Deaf, Dumb and the Blind v Shelley

The New South Wales Institution for the Deaf, Dumb and the Blind (the appellant) appealed to the High Court of Australia against a decision of the Supreme Court of New South Wales concerning the apportionment of estate duty. The dispute arose from the deceased's will, which directed that testamentary expenses be paid out of the residue of his estate. The appellant, a beneficiary under the will, argued that estate duty should be apportioned amongst all beneficiaries, including those who received gifts from the residue, rather than being solely borne by the residue itself.

The central legal issue before the High Court was whether the deceased's direction to pay testamentary expenses out of residue constituted a "different disposition" within the meaning of the relevant estate duty legislation, thereby exempting the residue from the general rule of apportionment. Specifically, the Court had to determine if this direction effectively altered the statutory scheme for the apportionment of estate duty amongst beneficiaries.

The High Court held that the deceased's direction to pay testamentary expenses out of residue did not amount to a "different disposition" for the purposes of estate duty apportionment. The Court reasoned that the legislation contemplated a clear and unambiguous intention to alter the statutory apportionment scheme. A direction to pay testamentary expenses from residue, while common, was interpreted as a standard administrative direction rather than an express intention to override the statutory duty to apportion estate duty amongst all beneficiaries. Consequently, the Court found that estate duty should be apportioned according to the statutory provisions, notwithstanding the direction in the will.