O'Donnell v O'Donnell

[2022] NSWSC 1742

Supreme Court

New South Wales

Medium Neutral Citation:

O’Donnell v O’Donnell [2022] NSWSC 1742

Hearing dates:

11 – 29 October 2021; 25 March 2022

Decision date:

16 December 2022

Jurisdiction:

Equity

Before:

Robb J

Decision:

See [545] – [547] below

Catchwords:

SUCCESSION — family provision — jurisdiction —deceased’s spouse makes family provision applications in New South Wales and Australian Capital Territory — whether deceased domiciled in New South Wales or Australian Capital Territory at date of death — consideration of principles governing domicile under private international law — deceased dies with moderately large actual estate but potentially substantial notional estate held by discretionary trust and corporate entities — availability of notional estate regime under Succession Act 2006 (NSW), Pt 3.3 where deceased found to have been domiciled outside New South Wales at date of death

SUCCESSION — family provision — claim by spouse for provision from the deceased’s estate or notional estate under Succession Act 2006 (NSW), Ch 3 — alternative claim by partner for provision from the deceased’s estate under Family Provision Act 1969 (ACT), s 8 — plaintiff fourth wife of deceased left with no provision under deceased’s will — deceased leaves statutory declaration expressing reasons for excluding plaintiff — whether adequate and proper provision made for the plaintiff and, if not, the nature and quantum of the provision to be made — plaintiff entitled to entirety of deceased’s actual estate subject to payment of any costs orders

SUCCESSION — administration of estates — devastavit — consideration of principles — whether mere applicant for family provision has standing to bring devastavit claim

SUCCESSION — family provision — claims by alleged members of household and dependants of the deceased for provision from the deceased’s estate or notional estate under Succession Act 2006 (NSW), Ch 3 — applications by two children of person with whom deceased had a domestic relationship — applications fail because of finding that deceased had domicile outside New South Wales — whether plaintiffs otherwise eligible persons under Succession Act 2006 (NSW), s 57(1)(e) — whether plaintiffs otherwise establish factors warranting applications

FAMILY LAW — claim by domestic partner of deceased to vary or set aside order under Domestic Relationships Act 1994 (ACT), s 28 — whether settlement agreement and consequential court orders affected by miscarriage of justice because of fraud or suppression of evidence or any other circumstance

Legislation Cited:

Civil Procedure Act 2005 (NSW), s 56

Constitution, Ch III

Domestic Relationships Act 1994 (ACT), ss 3, 13, 14, 15, 28

Domicile Act1979 (NSW), ss 6, 9, 11

Family Law Act 1975 (Cth), Pt VIIIAB Div 2, ss 4AA, 79, 90RD, 90SM

Family Provision Act 1969 (ACT), ss 7, 8, 9

Family Provision Act 1982 (NSW), ss 9, 22

Income Tax Assessment Act 1936 (Cth), Div 7A

Jurisdiction of Courts (Cross-vesting) Act 1993 (ACT), s 5

Legislation Act 2001 (ACT), s 169

Limitation Act 1969 (NSW), ss 11, 47

Succession Act 2006 (NSW), Ch 3, Pt 3.3, Pt 3.3 Div 3, ss 3, 57, 58, 59, 60, 63, 64, 71, 75, 76, 77, 80, 83, 84, 86, 87, 88, 89, 95

Cases Cited:

Application of Perpetual Trustee Company Ltd; Re: Estate of the late Evelyn Mary Dempsey [2016] NSWSC 159

Ball v Newey (1988) 13 NSWLR 489

Bassett v Bassett [2021] NSWCA 320

Bird v Bird (No 4) [2012] NSWSC 648

Bird v Bird [2013] NSWCA 262; (2013) 11 ASTLR 225

Chisak v Presot [2022] NSWCA 100

Commissioner of Stamp Duties (Qld) v Livingston (1964) 112 CLR 12; [1965] AC 694

DJ Singh v DH Singh [2018] NSWCA 30

Evans v Evans (1910) 10 SR (NSW) 594

Fremlin v Fremlin (1913) 16 CLR 212; [1913] HCA 25

Gaines-Cooper v Commissioners for HM Revenue and Customs [2007] EWHC 2617 (Ch)

Grant v Roberts; Smith v Smith; Roberts v Smith; Curtis v Smith [2019] NSWSC 843

Harris v Caladine (1991) 172 CLR 84; [1991] HCA 9

Hitchcock v Pratt (2010) 79 NSWLR 687; [2010] NSWSC 1508

In re Cartier, Deceased [1952] SASR 280

In re Jennery, dec’d, Jennery v Jennery [1967] Ch 280

In re Olson (Deceased), Treadwell v Public Trustee [1944] NZLR 778

In the Estate of Fuld, dec’d (No 3) (1968) P 675

In the Marriage of Ferrier-Watson v McElrath (2000) 26 Fam LR 169; [2000] FamCA 219

In the Marriage of M P and M J Suiker (1993) 17 Fam LR 236

Kavalee v Burbidge (1998) 43 NSWLR 422

Lieberman v Morris (1944) 69 CLR 69; [1944] HCA 13

Limberger v Limberger; Oakman v Limberger [2021] NSWSC 474

LK v Director-General, Department of Community Services (2009) 237 CLR 582; [2009] HCA 9

Lodin v Lodin [2017] NSWCA 327

McCosker v McCosker (1957) 97 CLR 566; [1957] HCA 82

Norton v Locke (2013) 50 Fam LR 517; [2013] FamCAFC 202

Petrohilos v Hunter (1991) 25 NSWLR 343

Plummer v Inland Revenue Commissioners [1988] 1 All ER 97

Potter v Minahan (1908) 7 CLR 277; [1908] HCA 63

Purnell v Tindale [2020] NSWSC 746

Re Fulop Deceased (1987) 8 NSWLR 679

Singer v Berghouse (No 2) (1994) 181 CLR 201; [1994] HCA 40

Skinner v Frappell [2008] NSWCA 296

Slack v Rogan; Palffy v Rogan (2013) 85 NSWLR 253; [2013] NSWSC 522

Spata v Tumino (2018) 95 NSWLR 706; [2018] NSWCA 17

Steinmetz v Shannon (2019) 99 NSWLR 687; [2019] NSWCA 114

Stone v Stone [2019] NSWSC 233

Sun v Chapman [2022] NSWCA 132

Taylor v Farrugia [2009] NSWSC 801

The Estate of Thiess; Brinkman v Johnston (Supreme Court (NSW), Hodgson J, 4 February 1994, unrep)

Treadtel International Pty Ltd v Cocco [2016] NSWCA 360; (2016) 117 ACSR 176

Udny v Udny (1869) LR 1 Sc & Div 441

Wardy v Salier [2014] NSWSC 473

Wentworth v Wentworth (Supreme Court (NSW), Young J, 4 September 1991, unrep (BC9101598))

Yesilhat v Calokerinos [2021] NSWCA 110

Texts Cited:

P L G Brereton, “Where Death and Divorce Meet: The Intersection of Family Provision and Family Law” (Speech, National Family Law Conference, October 2006)

R F Croucher, “Towards uniform succession in Australia” (2009) 83 ALJ 728

G E Dal Pont and K F Mackie, Law of Succession (2nd ed, 2017, LexisNexis Butterworths)

J de Groot and B Nickel, Family Provision in Australia (6th ed, 2021, LexisNexis)

J R Martyn and N Caddick, Williams, Mortimer and Sunnucks on Executors, Administrators and Probate (20th ed, 2013, Sweet & Maxwell)

N Perram, “The origins and present operation of the action in devastavit” [2012] FedJSchol 23

Tasmanian Law Reform Institute, Final Report No. 27: Should Tasmania Introduce Notional Estate Laws? (September 2019)

Category:

Principal judgment

Parties:

Proceedings 2019/120911
Kalpana O’Donnell (Plaintiff)
Jaimie Francis John O’Donnell (First Defendant)
Vanessa Channon (Second Defendant)
Laura O’Donnell (Third Defendant)
Ashley O’Donnell (Fourth Defendant)
Evenlong Pty Ltd (Fifth Defendant)
Duboti Pty Ltd (Sixth Defendant)

Proceedings 2019/363217
Kalpana O’Donnell (Plaintiff)
Jaimie Francis John O’Donnell (First Defendant)
Vanessa Channon (Second Defendant)
Laura O’Donnell (Third Defendant)
Ashley O’Donnell (Fourth Defendant)
Evenlong Pty Ltd (Fifth Defendant)
Duboti Pty Ltd (Sixth Defendant)

Proceedings 2021/194343
Kalpana O’Donnell (Plaintiff)
Jaimie Francis John O’Donnell (First Defendant)
Vanessa Channon (Second Defendant)
Laura O’Donnell (Third Defendant)
Ashley O’Donnell (Fourth Defendant)

Proceedings 2020/112383
Anna Gray (Plaintiff)
Jaimie Francis John O’Donnell (First Defendant)
Ashley O’Donnell (Second Defendant)
Vanessa Channon (Third Defendant)
Laura O’Donnell (Fourth Defendant)
Executors of the Estate of Garry O’Donnell (Fifth Defendant)

Proceedings 2019/372281
Kristina Elena Gray (First Plaintiff)
Jurek Gray (Second Plaintiff)
Jaimie Francis (First Defendant)
Vanessa Channon (Second Defendant)
Laura O’Donnell (Third Defendant)
Ashley O’Donnell (Fourth Defendant)

Representation:

Counsel:
Proceedings 2019/120911; 2019/363217; 2021/194343
L Ellison SC & L Nurpuri (Plaintiff)
M Meek SC & M Pringle (Defendants)

Proceedings 2020/112383
T Hodgson (Plaintiff)
M Meek SC & M Pringle (Defendants)

Proceedings 2019/372281
M Stevens (Plaintiffs)
M Meek SC & M Pringle (Defendants)

Solicitors:
Proceedings 2019/120911; 2019/363217; 2021/194343
Vincent Butcher Lawyers (Plaintiff)
Glass Goodwin (Defendants)

Proceedings 2020/112383
Mills Oakley (Plaintiff)
Glass Goodwin (Defendants)

Proceedings 2019/372281
Malouf Solicitors (Plaintiff)
Glass Goodwin (Defendants)

File Number(s):

2019/120911; 2019/363217; 2021/194343; 2020/112383; 2019/372281

JUDGMENT

Introduction

1. These reasons determine the issues raised by the parties to six proceedings that were heard together and all relate to the estate of the late Garry Francis O’Donnell (the deceased) who was born in Goulburn and died in Canberra on 26 November 2018 aged 67.

2. The deceased left a will dated 18 August 2015 (the will) in which he named four of his five children as his executors (the defendants or the executors). Probate of the will was granted to the executors by the Supreme Court of the Australian Capital Territory (the ACT) on 22 March 2019.

3. As did the parties themselves, I will, with no disrespect intended, generally refer to the parties and persons related to them by their first names.

The deceased’s relationships

4. My explanation of the nature of the proceedings will be made clearer if I begin with a description of the relevant relationships in the deceased’s life, focusing on the parties to the proceedings and other persons who are relevant to the determination of the proceedings.

5. The deceased married Cheryl Hogan in 1971. They were divorced in 1972. Cheryl remains alive. The defendant Jaimie is the deceased’s son of that relationship born 13 May 1971, and is aged 50.

6. On 26 January 1975, the deceased married his second wife, Joan O'Brien. They separated in or about 1987 and divorced in 1991. Joan remains alive. The deceased has two daughters from his marriage to Joan, namely the defendants Vanessa, born 5 January 1981, aged 40, and Laura, born 29 June 1984, aged 37.

7. On 15 June 1990, the deceased married his third wife, Fiona Costanza. They separated in or about 1996 and divorced in 1998. Fiona remains alive. The deceased has two children of that marriage, namely the defendant Ashley, born 19 October 1989, aged 31, and Simon, born 7 June 1991, aged 30.

8. The executors of the deceased’s will are Jaimie, Vanessa, Laura and Ashley.

9. From approximately 2000, the deceased had a relationship with Anna Gray, the plaintiff in one of the proceedings. Anna was born on 16 July 1959 and is currently aged 62. The nature of that relationship is the subject of dispute. The executors contend the relationship was that of boyfriend and girlfriend. The relationship ended in or about mid-2013. There are no children of that relationship. Family Court proceedings (referred to below) between Anna and the deceased were settled in 2015, without any judicial determination of the nature of the relationship.

10. Anna had children from a prior marriage, namely Jurek Gray, born 24 November 1985, aged 35, and Kristina Gray, born 11 July 1989, aged 32. Kristina and Jurek are plaintiffs in another of the proceedings.

11. In November-December 2012, the deceased met Kalpana (also known as Paris and Kay) and they married in Las Vegas on 9 May 2013. Kalpana, the first plaintiff to bring a claim, was the deceased’s fourth wife. They remained married until the deceased’s death. Kalpana was born on 21 December 1963 and is now 59 years of age.

12. There are no children of the deceased’s marriage with Kalpana. Kalpana has a child from a prior marriage, namely Tobias Findlay, born 26 June 1986, aged 35.

The proceedings

13. On 17 April 2019, Kalpana filed a summons in this Court commencing proceedings No 2019/120911 against the executors seeking an order under s 59 of the Succession Act 2006 (NSW) (the Succession Act) for provision out of the estate and the notional estate of the deceased. Notwithstanding that Kalpana was his wife, the deceased made no provision for her in his will.

14. By originating application dated 3 June 2019 filed in the Supreme Court of the ACT in proceedings No 278/2019, Kalpana sought an order against the executors under s 8 of the Family Provision Act 1969 (ACT) (the Family Provision Act) for provision out of the estate of the deceased.

15. On 20 September 2019, Anna also commenced proceedings No 470/2019 against the executors in the Supreme Court of the ACT for an order under s 8 of the Family Provision Act for provision out of the estate of the deceased. Anna was not a beneficiary under the will.

16. Kristina and Jurek commenced their own proceedings No 2019/372281 in this Court against the executors seeking orders under s 59 of the Succession Act for provision out of the estate and the notional estate of the deceased. They also were not beneficiaries under the will.

17. On 2 July 2020, Anna commenced proceedings No CAC1389/2020 in the Family Court of Australia at Canberra against the executors, the primary purpose of which was to obtain relief setting aside a deed of settlement between Anna and the deceased made on 12 October 2015 (the deed of settlement) under the Domestic Relationships Act 1994 (ACT) (the Domestic Relationships Act) under which Anna received a property settlement from the deceased.

18. Finally, by statement of claim filed in this Court on 7 July 2021 commencing proceedings No 2021/194343 against the executors, Kalpana sought a declaration that the executors had committed devastavit by wrongfully depleting the estate of the deceased of its assets by a transfer of shares in a company that were registered in the name of the deceased, without receiving any consideration for the transfer. Devastavit is the name given to wrongful conduct by executors of a deceased estate whereby they have diminished the value of the estate available to be paid to creditors and distributed to beneficiaries.

19. On 16 October 2019, the Supreme Court of the ACT (Crowe AsJ) heard an application by Kalpana to cross-vest her application for family provision relief in that Court to this Court under s 5(2) of the Jurisdiction of Courts (Cross-vesting) Act 1993 (ACT), and an order to that effect was subsequently made. The claim became proceedings No 2019/363217 in this Court.

20. On 8 September 2021, the Family Court of Australia (Gill J) made an order cross-vesting Anna’s proceedings in that Court to this Court to consider the application under the Domestic Relationships Act to set aside the deed of settlement for alleged fraud and failure to disclose.

21. It will be convenient to note at this point that Kalpana sought and obtained an order from the Court that two companies that form part of the group of companies controlled by the deceased (the O’Donnell group) be joined as defendants to Kalpana’s family provision proceedings under the Succession Act. One of those companies is Duboti Pty Ltd which, as will be seen, is the trustee of the Mugga Way Family Trust, which is the overarching discretionary trust that held all of the property controlled by the deceased that was not personally owned by him. The other company is Evenlong Pty Ltd, which is the trustee of the Newcastle Unit Trust. The shares in Evenlong Pty Ltd and the units in the Newcastle Unit Trust are owned by Duboti Pty Limited. Among other property, Evenlong Pty Ltd owned an apartment at Pyrmont in this State (the Pyrmont apartment) at which Kalpana and the deceased lived from time to time and which forms a significant aspect of the narrative in these proceedings. Under the deceased’s will, the executors now control Duboti Pty Ltd, Evenlong Pty Ltd and the other companies in the O’Donnell group.

22. Kalpana has not sought any specific relief against Duboti Pty Ltd or Evenlong Pty Ltd. Those companies have not played any independent role in the proceedings. Apparently, the executors’ solicitor has advised Kalpana’s solicitor that the executors would agree to be bound by, and act in accordance with, any notional estate orders made by the Court (in circumstances that will be explained below). That undertaking will not strictly bind the two companies that have been joined or any other companies in the O’Donnell group. In the circumstances, it will not be necessary to address the position of the two companies as parties.

Relationship between the proceedings

23. Although the proceedings commenced by Kalpana on the one hand, and Anna and her children on the other, raise distinct issues, the resolution of some claims may be influenced by the outcome of other claims. Although it will be necessary to consider the issues raised by the individual proceedings in considerably more detail below, the following brief outline may assist an understanding of the relationship between the proceedings.

24. As the deceased did not make any provision for Kalpana in his will, Kalpana now seeks orders for family provision under both the NSW and ACT statutes. The total value of the provision sought by Kalpana in her final submissions is $9,471,248.90. Kalpana also sought an order for the payment of the costs of these proceedings out of the estate or notional estate of the deceased.

25. As will shortly be seen, the parties ultimately agreed that the value of the deceased’s estate is $2,058,460.11, subject to the payment of any orders for costs that may be made in any of the proceedings. The deceased’s actual estate is clearly insufficient to meet the orders for family provision and costs sought by Kalpana.

26. Under Part 3.3 of the Succession Act of this State (NSW), the Court is empowered to make what are called “notional estate” orders that may have the effect, in this case, that a part of the net assets of the O’Donnell group will be treated as part of the deceased’s estate to the extent necessary to give effect to any order for family provision and costs in favour of Kalpana that the Court determines is appropriate. The value of the O’Donnell group is sufficient at between $28,170,236 and $32,720,859 to meet all the orders sought by Kalpana.

27. There is no equivalent to Part 3.3 of the Succession Act permitting a court to make orders designating notional estate for the purpose of meeting an application for family provision in the law of the ACT, or any other State or Territory in the Commonwealth.

28. The most significant issue concerning the claims made by Kalpana for family provision orders is whether the Court must determine those claims in the proceedings in this Court under the Succession Act or whether the statute that must be applied is the Family Provision Act. As will be seen, that is a complicated question of fact and law that depends principally on whether the deceased had a domicile in NSW or the ACT at the date of his death. The Court must apply the relevant principles of the conflicts of law to determine the statute that must be applied. Broadly, the law of the deceased’s domicile governs the succession to all of his movable property and the law of the situs of his immovable property governs the succession to that property. In practical terms, immovable property is equivalent to real property and all other relevant property is characterised as movable property.

29. The Court will be able to apply the Succession Act, and therefore Part 3.3 that permits orders for family provision and costs to be satisfied out of the whole of the deceased’s notional estate, if it finds that the deceased was domiciled in NSW. There is also a possibility, which I will consider below, that real property situated in NSW that was owned by companies in the O’Donnell group at the date of the death of the deceased will fall within the jurisdiction of this Court under Part 3.3 of the Succession Act because an order can be made designating the property as notional estate of the deceased. If the finding is that the deceased was domiciled in the ACT and there was no real property in this State, the only family provision statute that will apply is the Family Provision Act. That will place a ceiling on the assets that are available to satisfy all family provision and costs orders that the Court may have been able to make.

23. The value of the actual estate of the deceased may be affected by the outcome of Kalpana’s separate proceedings for an order that the executors have committed devastavit in respect of the deceased’s estate. Kalpana submitted in her final submissions that the shares the subject of this claim had a value of $3,607,401 as of 30 June 2021. If as a result of Kalpana succeeding on her devastavit claim the executors were ordered to replenish the deceased’s estate by that amount, then the additional sum would increase the assets available to the Court to make orders for family provision in Kalpana’s favour, even if the application must be determined under the Family Provision Act of the ACT because it is found that the deceased was domiciled in that Territory.

24. If the Court makes an order in Anna’s favour setting aside the deed of settlement, then an issue will arise as to what the effect of that order will be on the deceased’s estate. The assets settled by the deceased on Anna under the deed of settlement had a considerable value. Ordinarily, the Court will not make an order setting aside a transaction such as the deed of settlement without at the same time making appropriate orders that will restore the status quo as between the parties to the transaction before it was implemented. If orders of this nature were made against Anna in the present case, a consequence of her success would be that she would be required to restore the property settled on her to the deceased’s estate. If that were to happen, then the estate would be increased by the value of the restored property, which might improve Kalpana’s prospects of her claim for family provision, if the Court finds that the deceased was domiciled in the ACT when he died. I will explain below why Anna has resisted the suggestion that her success in obtaining an order setting aside the deed of settlement will require her to restore the settled property to the deceased’s estate.

25. Realistically, if Anna’s application for an order setting aside the deed of settlement succeeds but she is entitled to retain the property settled upon her under the deed of settlement, she will have little prospect of obtaining orders for family provision out of the deceased’s estate if he is found to have been domiciled in the ACT. The value of the property settled by the deceased on Anna appears to be greater than the probable value of the deceased’s actual estate, and Anna’s need for family provision will diminish in contest with Kalpana’s need for provision.

26. Jurek and Kristina have not made an application for family provision in the Supreme Court of the ACT because they accept that they are not eligible claimants under the Family Provision Act. They have an arguable case that they are entitled to be treated as eligible claimants under the Succession Act. Realistically, Jurek’s and Kristina’s prospects of success depend upon the Court finding that the deceased was domiciled in NSW and making an order designating part of the O’Donnell group as notional estate of the deceased for the purpose of their applications. Jurek and Kristina do not have a strong case for family provision in competition with Kalpana if the available subject of the orders for provision that they seek is limited to the actual estate of the deceased.

27. Kalpana’s costs calculated on the ordinary basis to the completion of the hearing were estimated to be $1,440,995. The amount of Kalpana’s costs on the indemnity basis was said to be $1,551,235, and, if an uplift factor of 25% is permitted, a total of $1,727,171. The executors advised that their legal costs for the hearing will total $1,062,945.08. I infer that those costs cover defence of all of the proceedings. Anna estimated her costs to complete the hearing at $250,000. Kristina’s and Jurek’s costs are said to be $255,000.

28. The value of the deceased’s estate that is available to satisfy any orders for family provision and costs made in favour of claimants will be reduced to the extent that the defendants’ costs are ordered to be paid out of the estate. The costs payable out of the estate to any successful claimant will also diminish the assets available to satisfy family provision orders. Uncertainty may be created by orders for payment of costs against unsuccessful claimants because it might not be clear whether the defendants will be able to recover those costs.

The deceased’s estate

36. The deceased during his lifetime was a successful businessman. The inventory of property prepared by the executors for the purpose of the application for a grant of probate in the ACT recorded that the net value of the deceased’s property was $6,463,024. The deceased’s assets included a debt owed to the deceased by Kalpana of $765,000 that is disputed, and a pink diamond with a value of $1,210,050 that has not been discovered. However Kalpana and the executors agreed after the conclusion of the hearing that the value of the deceased’s estate is $2,058,460.11, subject to the payment of any orders for costs that may be made in any of the proceedings. The Court was not informed of the basis of this agreement, and it is not clear whether it was agreed that the debt alleged to be payable to the deceased’s estate was not payable or simply irrecoverable. As I understand it, the positions taken by the parties’ respective expert accountants concerning the assets in the deceased’s estate and their value are as set out in a spreadsheet that was marked for identification as MFI 5. The parties ultimately agreed that the value adopted by the defendants’ expert was the correct one, so Kalpana must have abandoned her initial claim that the estate contained additional assets as asserted by her expert accountant.

37. Before the agreement between Kalpana and the executors referred to in the previous paragraph was reached, there was a substantial dispute between those parties concerning the value of the actual estate of the deceased. The parties retained expert accountants who prepared detailed expert reports and the expert witnesses prepared a joint report following a conclave. The parties devoted considerable forensic effort to this issue and the expert witnesses were cross-examined at length. The need for the Court to address this evidence has been obviated by the agreement reached by the parties.

38. As background, it should be recorded that in the deceased’s final years he apparently increased the level of his personal expenditure, but did so using the financial resources of companies in the O’Donnell group, without complying with legal obligations such as the declaration of dividends in his favour and compliance with applicable income tax reporting requirements. This led to an audit by the Australian Taxation Office (ATO) and subjected the deceased’s estate and companies within the O’Donnell group to potential liability under the current tax avoidance provisions in Division 7A of the Income Tax Assessment Act 1936 (Cth). It is sufficient to note that the executors reached a settlement with the ATO in relation to the application of Division 7A. This led to a reduction in the value of the actual estate of the deceased that is reflected in the agreement as to that value referred to above. As a result, the detailed effect of the agreement with the ATO was not ultimately explored by the parties. That does not matter for the purposes of these reasons, and the Court will simply accept the value of the actual estate of the deceased that was agreed. I note that the spreadsheet that is MFI 5 specifies amounts paid or remaining to be paid in relation to the Division 7A issue, and that some of the assets may not fetch their assumed value on sale.

39. All of the real (or immovable) property owned personally by the deceased, and thus part of his actual estate, was situated in the ACT. Those properties were 30 Mugga Way, Red Hill; a property that the parties called the Barton penthouse; and another apartment in the same building as the Barton penthouse. I will explain the significance of these properties more fully below.

The O’Donnell group

40. Over his working life, the deceased prospered and acquired substantial assets that were incorporated from time to time into what the parties called the O'Donnell group.

41. The parties explained the structure of the O'Donnell group by means of flowcharts. The flowcharts had three tiers of companies. At the top was Duboti Pty Ltd as trustee of the Mugga Way Family Trust. In the second tier were seven asset owning companies whose shares were owned as to either 100% or in two cases 50% by Duboti Pty Ltd. One of the companies in the second tier was Evenlong Pty Ltd, which has been mentioned above. Another company in the second tier, Fashionable Leasing Pty Ltd, owned either 100% or in one case 50% of the shares in the nine asset owning companies in the third tier. As a result of a process of rationalising the O’Donnell group undertaken by the executors since the death of the deceased, seven of the companies in the third tier are inactive or have been deregistered. It is unnecessary to identify the assets held by each of the companies in the O’Donnell group. Particular companies and the assets held by them will be considered below where relevant to the issues that require determination.

42. Sitting in the second tier but not part of the O’Donnell group under Duboti Pty Ltd is Soothink Pty Ltd, which is shown as being beneficially held as to 100% by the deceased. Soothink Pty Ltd is shown as being trustee of the Mugga Way Capital Trust, but that trust does not appear to have been explained clearly in the evidence.

43. The revised flowchart provided by the defendants became part of MFI-4. Kalpana provided a competing flowchart that became MFI-6, which was substantially same as the defendants' flow chart, except that, in stating the shareholding relationship between the deceased and particular companies, Kalpana relied literally on the information contained in the ASIC records concerning whether the deceased held shares beneficially or non-beneficially. The explanation for the difference is that, on 13 December 1996, the deceased executed a number of declarations of trust of shares held by him in companies in the O’Donnell group. At the same time, other persons who held some of those shares executed declarations of trust in the same terms as the deceased. On a number of occasions the other party was Fiona, the deceased’s third wife. In some cases the beneficiary of the declarations of trust was Fashionable Leasing Pty Ltd. In other cases the beneficiary was Duboti Pty Ltd as trustee of the Mugga Way Family Trust. Declarations of trust were executed over the shares in Fashionable Leasing Pty Ltd in favour of Duboti Pty Ltd on the same basis. The effect was to make Fashionable Leasing Pty Ltd the beneficial owner of the shares in some of the companies in the third tier and Duboti Pty Ltd became the beneficial owner of shares in companies in the second tier and indirectly the beneficial owner of shares in companies in the third tier through Fashionable Leasing Pty Ltd. As I understand it, the result as depicted in the defendants’ flowchart, was that, except for Soothink Pty Ltd, Duboti Pty Ltd as trustee of the Mugga Way Family Trust, stood at the top of the pyramid and directly or indirectly controlled and beneficially owned the companies in the two lower tiers, except in a small number of cases where a third party owned 50% of the shares in particular companies.

44. Notwithstanding the existence of the declarations of trust, it appears that for some time the returns made to ASIC in respect of the shareholding in the companies stated that the deceased and the other shareholders retained the beneficial ownership of the shares. After the grant of probate of the deceased’s will to the executors, they acted upon the declarations of trust to execute transfers of the shares in favour of Duboti Pty Ltd or Fashionable Leasing Pty Ltd. The defendants’ flowchart was prepared on the basis that the execution of these transfers was valid. Kalpana’s flowchart was prepared on the basis that the transfers had not been executed. As I understand it, the transfers will be valid even if it was wrongful for the executors to have implemented them. Accordingly, I have proceeded on the basis that the defendants’ flowchart correctly represents the current ownership structure of the O’Donnell group of companies.

45. The defendants have been in control of the O'Donnell group since the grant of probate to them, as the effect of the deceased's will was that the defendants became entitled as the deceased's executors to exercise the powers attached to the deceased's shareholding in the various companies. Subject to the outcome of these proceedings, the deceased's five children will become entitled to his shares in the companies in the O'Donnell group by implementation of the scheme contained in the will. The Court does not know in any detail what steps have been taken to execute the terms of the will. That does not matter, as it is sufficient to know that the defendants have been in control of the O'Donnell group since the grant of probate.

46. It may be noted generally that the assets held by individual companies in the O'Donnell group comprised valuable hotel investments, childcare businesses, home units and other real properties and a rural property. Nothing at this stage turns on the detailed composition of the assets held by the companies in the O'Donnell group.

47. The evidence given by the expert valuation witnesses retained by the executors and Kalpana respectively attributed a total net value to the O’Donnell group of $28,170,236 or $32,720,859. The variance of $4,450,622 cannot be resolved on the evidence, and the parties apparently agree that the difference is not material for the purposes of these proceedings, as either value will be sufficient to satisfy Kalpana’s family provision claim and a costs order in her favour if the assets in the O’Donnell group are available for that purpose.

The Mugga Way Family Trust

48. The Mugga Way Family Trust was created by deed of trust made on 29 June 1991. Duboti Pty Ltd was appointed as Trustee. Under clause 1(c), the Vesting Day is the sooner of 80 years from the execution of the deed and the day of execution by the Trustee of a deed declaring that day to be the Vesting Day. It is sufficient to note that clause 3(a) provides that the Trustee holds the income of the trust in respect of each Accounting Period for one or more of the beneficiaries as the Trustee in its absolute discretion may determine, or alternatively the Trustee may resolve to accumulate income. Similarly, by clause 6(1), on the Vesting Day the Trustee has an absolute discretion to distribute the income and capital of the Trustee among the Beneficiaries. Finally, clause 7(5) empowered the Trustee in its sole discretion at any time to apply the whole or any part of the capital to any one or more of the Beneficiaries in such manner as the Trustee thinks fit. Capital and income Beneficiaries were separately specified in the Schedule to the trust deed.

49. The trust deed provided for an office of Appointor who at the date of the deceased’s death was the deceased’s long-term accountant. The Appointor was given various powers under the trust deed, including an unfettered power to remove and replace Duboti Pty Ltd as trustee, but those powers had not been exercised by the time of the deceased’s death.

50. The Beneficiaries were identified in Item 6 of the Schedule to the trust deed. The first-named capital beneficiary was Soothink Pty Ltd. The capital Beneficiaries included “any other corporation, partnership or trust in which Garry Francis O’Donnell has a beneficial interest.” The income Beneficiaries included Soothink and any child of the deceased.

51. As a practical matter, the Mugga Way Family Trust and the O’Donnell group of companies were structured in a way that gave the deceased the power and right in his absolute discretion to distribute the income and capital of the Trust to the identified Beneficiaries, including himself through Soothink Pty Ltd.

The deceased’s control of the O’Donnell group and the Trust

52. At the date of his death, the deceased was the holder of all of the 100 issued shares in Duboti Pty Ltd. The deceased held 49 of those shares beneficially, and he apparently held 51 shares on trust for Duboti Pty Ltd itself, as trustee for the Mugga Way Family Trust. The evidence does not appear to establish how the deceased came to hold the 51 shares on trust for Duboti Pty Ltd. There was no contest as to the truth of this proposition, which is apparently based upon an assertion by the deceased’s long-term accountant. There was no suggestion that the deceased’s holding of the 51 shares as trustee constrained his entitlement to exercise his rights as the 100% shareholder in Duboti Pty Ltd to cause that company to exercise its powers as the trustee of the Mugga Way Family Trust in a manner that was favourable to the deceased.

53. The deceased was the sole director of every company in the O'Donnell group, except for Duboti Pty Ltd and the companies in which third parties held shares. For some years before the deceased’s death, Jaimie was also a director of Duboti Pty Ltd. The evidence justifies a finding, however, that Jaimie’s appointment as a director was nominal and he did not play an active part in the management of the company. I am also satisfied that Jaimie would have acted in all matters in accordance with the deceased’s requests. Jaimie said in cross-examination: “all I was really required to do was sign paperwork usually once or twice a year” [T 395.43]. In answer to the question: “Did he run the companies the same way he ran what I asked you earlier, his way or the highway?” by saying: “Largely, yes” [T 396.4]. Asked what Duboti Pty Ltd did as the controlling company of the O’Donnell group, Jaimie said: “Not a clue” [T 396.32].

Overview of Kalpana’s family provision claims

54. As I have explained above, Kalpana has made claims for family provision under s 59 of the Succession Act in this Court and under s 8 of the Family Provision Act in the Supreme Court of the ACT that has been cross-vested to this Court. It is necessary to consider whether Kalpana is entitled to maintain her claims and to identify the statutory provisions that govern them.

Kalpana’s eligibility

55. Kalpana is eligible to make her claims for family provision as she was the spouse of the deceased at the date of his death for the purposes of s 57(1)(a) of the Succession Act and his partner for the purposes of s 7(1)(a) of the Family Provision Act because she was his spouse.

Timeliness of applications

56. Kalpana commenced the claim for family provision in this Court on 17 April 2019 and in the Supreme Court of the ACT on 3 June 2019. Her proceedings were commenced within the 12-month period following the death of the deceased required by s 58(2) of the Succession Act as the deceased died on 26 November 2018. Section 9(1) of the Family Provision Act requires, in the ordinary case, that the claim be commenced within the 6 months period after the grant of administration. As the grant of probate was made by the Supreme Court of the ACT on 22 March 2019, the application was within time under the Family Provision Act.

Statutory basis for family provision orders

57. The material provisions of the Succession Act that govern this Court’s power to make a family provision order in favour of an eligible applicant are:

59   When family provision order may be made

(1)    The Court may, on application under Division 1, make a family provision order in relation to the estate of a deceased person, if the Court is satisfied that—

(a)    the person in whose favour the order is to be made is an eligible person, and

…

(c)    at the time when the Court is considering the application, adequate provision for the proper maintenance, education or advancement in life of the person in whose favour the order is to be made has not been made by the will of the deceased person, or by the operation of the intestacy rules in relation to the estate of the deceased person, or both.

(2)    The Court may make such order for provision out of the estate of the deceased person as the Court thinks ought to be made for the maintenance, education or advancement in life of the eligible person, having regard to the facts known to the Court at the time the order is made.

Note—

Property that may be the subject of a family provision order is set out in Division 3. This Part applies to property, including property that is designated as notional estate (see section 73). Part 3.3 sets out property that may be designated as part of the notional estate of a deceased person for the purpose of making a family provision order.

…

60   Matters to be considered by Court

(1)    The Court may have regard to the matters set out in subsection (2) for the purpose of determining—

(a)    whether the person in whose favour the order is sought to be made (the applicant) is an eligible person, and

(b)    whether to make a family provision order and the nature of any such order.

(2)    The following matters may be considered by the Court—

(a)    any family or other relationship between the applicant and the deceased person, including the nature and duration of the relationship,

(b)    the nature and extent of any obligations or responsibilities owed by the deceased person to the applicant, to any other person in respect of whom an application has been made for a family provision order or to any beneficiary of the deceased person’s estate,

(c)    the nature and extent of the deceased person’s estate (including any property that is, or could be, designated as notional estate of the deceased person) and of any liabilities or charges to which the estate is subject, as in existence when the application is being considered,

(d)    the financial resources (including earning capacity) and financial needs, both present and future, of the applicant, of any other person in respect of whom an application has been made for a family provision order or of any beneficiary of the deceased person’s estate,

…

(g)    the age of the applicant when the application is being considered,

(h)    any contribution (whether financial or otherwise) by the applicant to the acquisition, conservation and improvement of the estate of the deceased person or to the welfare of the deceased person or the deceased person’s family, whether made before or after the deceased person’s death, for which adequate consideration (not including any pension or other benefit) was not received, by the applicant,

(i)    any provision made for the applicant by the deceased person, either during the deceased person’s lifetime or made from the deceased person’s estate,

(j)    any evidence of the testamentary intentions of the deceased person, including evidence of statements made by the deceased person,

(k)    whether the applicant was being maintained, either wholly or partly, by the deceased person before the deceased person’s death and, if the Court considers it relevant, the extent to which and the basis on which the deceased person did so,

…

(m)    the character and conduct of the applicant before and after the date of the death of the deceased person,

…

(p)    any other matter the Court considers relevant, including matters in existence at the time of the deceased person’s death or at the time the application is being considered.

58. The equivalent provision that governs the making of family provision orders by the Supreme Court of the ACT is s 8 of the Family Provision Act, which relevantly provides:

(1) On application by a person entitled, under section 7, to apply for provision out of the estate of a deceased person, the Supreme Court may order that the provision as that court thinks fit be made for the applicant out of the estate.

(2)   The Supreme Court shall only make an order under subsection (1) if satisfied, in consideration of the criteria set out in subsection (3), that as at the date of the order, adequate provision for the proper maintenance, education or advancement in life of the applicant is not available—

(a)   under the will of the deceased; or

…

(3)   The criteria for the Supreme Court's decision under subsection (2) in relation to the deceased and the applicant are as follows:

(a)   the character and conduct of the applicant;

(b)   the nature and duration of the relationship between the applicant and the deceased;

(c)   any financial and non-financial contributions made directly or indirectly by or on behalf of either or both the applicant and the deceased to the acquisition, conservation or improvement of any of the property or financial resources of either or both persons;

(d)   any contributions (including any in the capacity of homemaker or parent) by either the applicant or the deceased to the welfare of the other, or of any child of either person;

(e)   the income, property and financial resources of the applicant and the deceased;

(f)   the physical and mental capacity of the applicant, and the deceased (during his or her life), for appropriate gainful employment;

(g)   the financial needs and obligations of the applicant and the deceased (during the life of the deceased);

(h)   the responsibilities of either the applicant or the deceased (during his or her life) to support any other person;

(i) the terms of any order made under the Domestic Relationships Act 1994, section 15 with respect to the property of the applicant or the deceased;

(j)   any payments made to either the applicant or the deceased by the other, under an order of the court or otherwise, in respect of the maintenance of the other person or any child of the other person;

(k)   any other matter the court considers relevant.

…

59. Under s 8 of the Family Provision Act, the Court has power to order that the provision that the Court thinks fit be made for the applicant out of the estate of the deceased, but only if it is satisfied, having regard to the listed factors that, as at the date of the order, adequate provision for the proper maintenance, education or advancement in life of the applicant is not available under the will of the deceased. Under the Succession Act two criteria must be satisfied. First, the Court must be satisfied that, at the time it considers the application, adequate provision for the proper maintenance, education or advancement in life of the applicant has not been made by the will of the deceased person. If the Court is so satisfied, it may order such provision out of the estate of the deceased as the Court thinks ought to be made for the maintenance, education or advancement in life of the applicant, having regard to the facts known at the time the order is made.

60. There was no suggestion in the present case that the differences between the two statutory regimes made any material difference to Kalpana's applications under each statute and the parties accepted that the effect of the two statutes was broadly equivalent.

61. The primary difference between the two statutory regimes is that s 8(1) of the Family Provision Act only permits provision to be ordered out of the deceased's estate. While s 59(2) of the Succession Act is to the same effect, the note to that subsection advises in effect that a family provision order may be made out of property that is designated as part of the notional estate of the deceased under Part 3.3, as well as out of the estate.

Principles governing application of the statutes

62. I respectfully adopt the following statement of the general principles to be applied in the exercise of the statutory jurisdiction to make family provision orders made unanimously by the Court of Appeal in Bassett v Bassett [2021] NSWCA 320 (Bell P, as the Chief Justice then was, Leeming and Payne JJA). Their Honours said:

[78] Before an order for provision can be made in favour of a child of the deceased (who is an “eligible person” within the meaning of s 59 of the Succession Act), the Court must be satisfied that “adequate provision for the proper maintenance, education or advancement in life of the person in whose favour the order is to be made has not been made by the will of the deceased person”: Succession Act, s 59(1)(c).

[79] Satisfaction in this regard is “jurisdictional” insofar as it is a prerequisite to the Court exercising its discretionary power to make an order for provision pursuant to s 59(2): see, for example, as to the use of the description “jurisdictional”, White v Barron (1980) 144 CLR 431 at 456; [1980] HCA 14; Singer at 208–210; Hampson v Hampson [2010] NSWCA 359; (2010) 5 ASTLR 116 at [69]–[72]. Care must, however, be taken when answering this jurisdictional question not to confine the relevant consideration to an applicant’s financial or material needs; the language of “proper maintenance, education or advancement” involves more than simply a question of financial needs: see Sgro v Thompson [2017] NSWCA 326 at [68]–[74] (Sgro).

[80] Once the level of satisfaction referred to in [78] has been reached, the Court has a broad discretion, “having regard to the facts known to the Court at the time the order is made” (emphasis added), to make such order for provision out of the estate as ought to be made “for the maintenance, education or advancement in life of the eligible person”: Succession Act, s 59(2).

[81] In considering both whether to make a family provision order and the nature of any such order if the threshold required by s 59(1)(c) is satisfied, the Court is entitled to consider the broad range of matters specified in s 60(2) of the Succession Act. The breadth of the matters that may be considered under s 60(2) does not, however, authorise the making of an order which is for a purpose other than “the maintenance, education or advancement in life of the eligible person”. Nor does it relieve the Court of the need to make the order “having regard to the facts known to the Court at the time the order is made” (emphasis added).

[82] The primary judge’s summary of relevant principles, as noted at [59] above, was not challenged. It is convenient to add a reference to McCosker v McCosker (1957) 97 CLR 566 at 571–572; [1957] HCA 82 (McCosker), in which Dixon CJ and Williams J observed that:

“The question is whether, in all the circumstances of the case, it can be said that the respondent has been left by the testator without adequate provision for his proper maintenance, education and advancement in life. As the Privy Council said in Bosch v Perpetual Trustee Co (Ltd.) [1938] NSW St Rp 3; [1938] AC 463; (1938) 38 SR (NSW) 176 the word ‘proper’ in this collocation of words is of considerable importance. It means ‘proper’ in all the circumstances of the case, so that the question whether a widow or child of a testator has been left without adequate provision for his or her proper maintenance, education or advancement in life must be considered in the light of all the competing claims upon the bounty of the testator and their relative urgency, the standard of living his family enjoyed in his lifetime, in the case of a child his or her need of education or of assistance in some chosen occupation and the testator’s ability to meet such claims having regard to the size of his fortune. If the court considers that there has been a breach by a testator of his duty as a wise and just husband or father to make adequate provision for the proper maintenance education or advancement in life of the applicant, having regard to all these circumstances, the court has jurisdiction to remedy the breach and for that purpose to modify the testator’s testamentary dispositions to the necessary extent.”

[83] Kitto J’s observations in the same case at 579 are also of note:

“The testator has shown by the terms of his will that he did not fail to consider what he ought to do for the several members of his family and that it was his deliberate judgment that some of them, including the respondent, had been adequately provided for by assistance he had given them. His opinion on the subject is, of course, by no means conclusive. But there is nothing to suggest that he was under any misapprehension, or that he was in any way prejudiced against the respondent; and the case seems to me to be one of those in which the testator is much more likely to have formed a correct conclusion on the subject of the moral obligations he owed to his family than a court can well hope to be.”

[84] In Singer at 208–209, the majority held, in the context of broadly equivalent provisions under the predecessor Family Provision Act 1982 (NSW), that:

“It is clear that, under these provisions, the court is required to carry out a two-stage process. The first stage calls for a determination of whether the applicant has been left without adequate provision for his or her proper maintenance, education and advancement in life. The second stage, which only arises if that determination be made in favour of the applicant, requires the court to decide what provision ought to be made out of the deceased’s estate for the applicant. The first stage has been described as the ‘jurisdictional question’. That description means no more than that the court’s power to make an order in favour of an applicant under s 7 is conditioned upon the court being satisfied of the state of affairs predicated in s.9(2)(a).”

[85] More recently, in Vigolo v Bostin (2005) 221 CLR 191; [2005] HCA 11 at [122] (Vigolo), Callinan and Heydon JJ observed, in relation to the corresponding Western Australian legislation, that the questions which the Court has to answer in assessing such a claim do not “necessarily always divide neatly into two” and that:

“Adequacy of the provision that has been made is not to be decided in a vacuum, or by looking simply to the question whether the applicant has enough upon which to survive or live comfortably. Adequacy or otherwise will depend upon all of the relevant circumstances, which include any promise which the testator made to the applicant, the circumstances in which it was made, and, as here, changes in the arrangements between the parties after it was made. These matters however will never be conclusive. The age, capacities, means, and competing claims, of all of the potential beneficiaries must be taken into account and weighed with all of the other relevant factors.”

[86] Vigolo is also significant because three of the five justices (Gleeson CJ, Callinan and Heydon JJ) supported the continuing utility in this field of discourse of notions of moral obligation and duty. Thus, Gleeson CJ (at [25]) observed that:

“In explaining the purpose of testator’s family maintenance legislation, and making the value judgments required by the legislation, courts have found considerations of moral claims and moral duty to be valuable currency. It remains of value, and should not be discarded. Such considerations have a proper place in the exposition of the legislative purpose, and in the understanding and application of the statutory text. They are useful as a guide to the meaning of the statute. They are not meant to be a substitute for the text.”

See also Callinan and Heydon JJ at [121], cf Gummow and Hayne JJ at [63]–[73].

[87] It is also relevant to note that in Sgro at [83], White JA (with whom McColl and Payne JJA agreed) repeated what he had earlier said in Slack v Rogan; Palffy v Rogan (2013) 85 NSWLR 253; [2013] NSWSC 522 at [127] as follows:

“In my view, respect should be given to a capable testator’s judgment as to who should benefit from the estate if it can be seen that the testator has duly considered the claims on the estate. That is not to deny that s 59 of the Succession Act interferes with the freedom of testamentary disposition. Plainly it does, and courts have a duty to interfere with the will if the provision made for an eligible applicant is less than adequate for his or her proper maintenance and advancement in life. But it must be acknowledged that the evidence that can be presented after the testator’s death is necessarily inadequate. Typically, as in this case, there can be no or only limited contradiction of the applicant’s evidence as to his or her relationship and dealings with the deceased. The deceased will have been in a better position to determine what provision for a claimant’s maintenance and advancement in life is proper than will be a court called on to determine that question months or years after the deceased’s death when the person best able to give evidence on that question is no longer alive. Accordingly, if the deceased was capable of giving due consideration to that question and did so, considerable weight should be given to the testator’s testamentary wishes in recognition of the better position in which the deceased was placed (Stott v Cook (1960) 33 ALJR 447 per Taylor J at 453–454 cited in Nowak v Beska [2013] NSWSC 166 at [136] ). This is subject to the qualification that the court’s determination under s 59(1)(c) and s 59(2) is to be made having regard to the circumstances at the time the court is considering the application, rather than at the time of the deceased’s death or will.”

63. The observations of Dixon CJ and Williams J in McCosker v McCosker (1957) 97 CLR 566 at 571-572; [1957] HCA 82, extracted by the Court of Appeal in Bassett v Bassett at [82], are of particular relevance in the present case, as the deceased chose to apply his wealth to fund an extremely opulent lifestyle for himself and Kalpana during the period of their relationship.

64. As noted above, the deceased made no provision for Kalpana in his will, but he did make a statutory declaration at the same time in which he stated his reasons for leaving nothing to his wife. Consequently, the considerations stated by White J (as his Honour then was) in Slack v Rogan; Palffy v Rogan (2013) 85 NSWLR 253; [2013] NSWSC 522, in the extract contained in [87] of their Honours’ judgment above, will be significant in the present case.

65. Although Kalpana was the deceased’s fourth wife, his former wives have made no claim on his estate. The competing claims are between Kalpana, the deceased’s five children, Anna, Kristina and Jurek. Thus, the competition is between a fourth wife of about five years duration, the five children of the deceased by prior marriages, a party who claims to be a former de facto partner, and that party’s children by a prior marriage. I must qualify the reference to Anna’s claim for family provision because, as I will explain below, Anna ultimately supported her claim for an order setting aside the deed of settlement and the orders made by the Family Court but does not appear to have made submissions in support of her family provision claim.

66. For the purpose of determining the merits of Kalpana’s claim, it will be necessary to examine recent authority that has considered the application of the family provision sections of the Succession Act in the context of applications by widows for family provision relief. The Court of Appeal considered this issue in Steinmetz v Shannon (2019) 99 NSWLR 687; [2019] NSWCA 114. Although White JA was the presiding judge, I will refer first to the judgment of Brereton JA, as White JA expressed his reasons relevantly as a response to Brereton JA’s reasons. Materially, Brereton JA said (footnotes omitted):

Widows’ claims

[98] His Honour said that claims by widows do not constitute a separate category deserving of more favourable treatment, and that there was no general rule that if the size of the estate is sufficient a widow is entitled to expect that she will be provided for such that she may continue to live in the style to which she is accustomed. That there is no general rule that the widow’s claim is always paramount is undoubted. So much was stated in the passage cited by his Honour from Re the Will of Gilbert, though the qualification stated by Jordan CJ is also important:

“… there is no general rule that the widow’s right is in all cases paramount; although, on the facts, and in the circumstances, of particular cases, it may be proper to regard it as such. On the other hand, where, for example, the applicant is a second wife who has been married to the testator for only a short period, it may be proper, on the facts of a particular case, to take specially into account the position of the children of the first marriage”.

[99] The proposition that there was no general rule that the widow’s claim is always paramount was restated in Bladwell v Davis, by Bryson JA (albeit obiter, as leave to appeal was refused). Again, however, the qualifying comments of Ipp JA, with whom Stein AJA agreed, are important:

“[1] I agree with Bryson JA, for the reasons his Honour has stated, that ‘it would be an error to accord to widows generally primacy over all other applicants regardless of circumstances and regardless of performance of the stages of consideration described in Singer v Berghouse (1994) 181 CLR 201 …’.

[2] I would add, however, that where competing factors are more or less otherwise in equilibrium, the fact that one party is the elderly widow of the testator, is permanently unable to increase her income, and is never likely to be better off financially, while the other parties are materially younger and have the capacity to earn more or otherwise improve their financial position in the future, will ordinarily result in the needs of the widow being given primacy. That is simply because, in such circumstances, the widow will have no hope of improving herself economically, whereas that would not be the position of the others. In that event, the need of the widow would be greater than that of the others.”

[100] Those statements, about “paramountcy” or “primacy” of a widow’s claim, were made in the context that there were competing claims on estates that were insufficient to meet all of them. In contrast, the present case is not one in which questions of primacy or paramountcy arise. That is because, as the primary judge said, the deceased’s estate was ample to accommodate the appellant’s claim without occasioning hardship to the respondents. This was not a case in which the estate was insufficient to meet all claims on the testator, or to enable him to satisfy his obligations to all of them, and so no occasion to determine whether primacy had to be given to one over the others arose.

[101] The question of what provision ought as a matter of community standards be made for a widow has been addressed in numerous cases, and the obligations of a testator towards a surviving spouse have often been described. …

…

[104] The “broad general rule” referred to in Luciano v Rosenblum was echoed by the Court of Appeal in Golosky v Golosky, in which Kirby P (as his Honour then was), with whom Cripps JA agreed, said that in the absence of special circumstances, it will normally be the duty of a testator to ensure that a spouse is provided with accommodation appropriate to that which she or he has been accustomed, and to the extent that the assets available permit, a fund to meet unforeseen contingencies:

“(c) Consideration of other cases must be conducted with circumspection because of the inescapable detail of the factual circumstances of each case. It is in the detail that the answer to the proper application of the Act is to be discovered. No hard and fast rules can be adopted. Nevertheless, it had been said that in the absence of special circumstances, it will normally be the duty of a testator to ensure that a spouse (or spouse equivalent) is provided with a place to live appropriate to that which he or she has become accustomed to. To the extent that the assets available to the deceased will permit such a course, it is normally appropriate that the spouse (or spouse equivalent) should be provided, as well, with a fund to meet unforeseen contingencies; see Luciano (above) 69 to 70;

(d) A mere right of residence will usually be an unsatisfactory method of providing for a [spouse’s] accommodation to fulfil the foregoing normal presupposition.”

[105] In O’Loughlin v O’Loughlin, Davies AJA, with whom Mason P and Meagher JA agreed, said:

“[20] It is undoubtedly true to say that there is no such thing as a ‘standard widow’ and that every case must be determined on its own particular circumstances. However, it has long been recognized that, arising out of the marriage relationship, a testator has a duty to provide support for his widow after his death if she has need of it and if his estate has funds so to provide. Courts give more attention to the needs of a widow than they do to the needs of the children, if the children are adult and well able to support themselves. This point was made clear by the remarks of Lord Romer in Bosch v Perpetual Trustee Company Limited which I have cited above. There are many dicta to the same effect. In Worladge v Doddridge (1957) 97 CLR 1, Williams and Fullagar JJ said at 11:

‘It is clear that the claim of a widow, where the estate is of considerable value, and there are no competing claims of children, should not be disposed of in any niggardly manner. She is entitled to such a provision for her maintenance and support as the court or judge thinks proper and “proper” is a word which, as the Privy Council pointed out in Bosch’s Case lets in all the considerations there adverted to.’

[21] In Gregory v Hudson [1999] NSWCA 221, Handley JA, with whom Cole AJA agreed, cited with approval the remarks of Powell J in Luciano v Rosenblum which I have mentioned. In Sayer v Sayer, Sheller JA referred to the fourth principle as stated by Stout CJ in In re Allardice, Allardice v Allardice which was referred to by Lord Romer in Bosch v Perpetual Trustee Company Limited. At paragraph 9, Sheller JA also referred to the remarks of Powell J in Luciano v Rosenblum and expressed the view that, in the case before him, the widow’s claim was ‘paramount’. These are examples of cases where judges have referred to a need on the part of a widow for maintenance and support and a moral obligation on the part of the testator to provide it.”

[106] As this court pointed out in Burke v Burke, such observations are not rules of law, but guidelines that may give assistance and provide guidance that are not to be elevated to rules of law. That does not mean that they are without importance and significance, because, as Basten JA explained in Chapple v Wilcox:

“[19] … the real provenance of the ‘principles’ is that they constitute a reflection of community values, being a factual matter, but one as to which reasoned findings of judges with experience in these matters may well provide valuable guidance.”

[107] Similarly, Barrett JA explained:

“[67] … [they] provide a useful touchstone that may be applied with circumspection by judges called upon to ascertain and apply ‘the feeling and judgment of fair and reasonable members of the community’ in cases of the present kind.”

[108] Such guidelines also provide the additional benefit of affording a certain amount of consistency in decision-making, and indication of expectations and advice to litigants. Without such guidelines, decision-making and advising in this field becomes a morass of idiosyncratic decisions devoid of any consistency.

[109] Some of the passages to which I refer use the traditional concept of “moral duty”, rather than the more fashionable one of “community standards”. For my part, I prefer the former, which — despite its disapproval in Singer v Berghouse — was rehabilitated in Vigolo v Bostin, and is recognised in the statute. However, I doubt that the difference matters much; what the community expects a testator to do by way of provision for claimants on his or her bounty, and what the testator is morally obliged to do in that respect, are probably the same thing.

67. White JA added the following observations:

[37] With the following riders, that are in part by way of emphasis and in part by way of qualification, I agree with the reasons of Brereton JA in relation to guidelines for widows’ claims (at [98]–[109]). The matter of emphasis is that guidelines such as those expressed by Powell J in Luciano v Rosenblum (1985) 2 NSWLR 65 for claims by widows … cannot be elevated to inflexible rules and are subject always to the consideration of the particular circumstances of each case, including the size of the estate, any competing claims, the applicant’s conduct and the applicant’s relationship with the deceased. …

…

[40] My qualification concerns recourse to community standards or community expectations. I acknowledge the weight of authority that endorses a judge’s bolstering his or her view as to whether an applicant has been left without adequate provision for proper maintenance or advancement in life and whether a testator or testatrix has failed in his or her moral duty to provide such adequate provision, by reference to what the community (or fair and reasonable members of the community) would expect (for example, Chapple v Wilcox at [11], [12] and [102]; Andrew v Andrew (2012) 81 NSWLR 656; [2012] NSWCA 308 at [12] and [13]).

[41] My first difficulty is in understanding what is meant by community standards or community expectations. Does it refer to the community generally or to a more particular community of which the deceased and his family and the applicant form part informed by particular cultural, ethnic, religious or social values? I assume that the answer is the former, although I am not aware of any case in which the question has yet come up for decision. What would be the position if the expectation of a particular cultural, ethnic, social or religious community in which the deceased lived was that a child who married without his or her parents’ consent should be cut off without a penny? Would evidence of that expectation be an answer to an otherwise worthy claim? I would answer that question in the negative, but that is because I do not consider the references to community standards or community expectations are to an externally provable fact. In Goodman v Windeyer (1980) 144 CLR 490; [1980] HCA 31 Gibbs J said (at 502):

“… the words ‘adequate’ and ‘proper’ are always relative. There are no fixed standards, and the court is left to form opinions upon the basis of its own general knowledge and experience of current social conditions and standards”.

…

[43] It is the court’s perception of what fair and reasonable members of the community would expect a testator to provide for the applicant, not something that is to be proved as a standard against which the court’s judgment is to be made, that is relevant.

68. Simpson AJA substantially agreed with the reasons given by Brereton JA.

69. Finally, Ward CJ in Eq (as her Honour then was) said in Grant v Roberts; Smith v Smith; Roberts v Smith; Curtis v Smith [2019] NSWSC 843:

[168] As the Court of Appeal in Steinmetz v Shannon [2019] NSWCA 114 (Steinmetz v Shannon) has recently made clear, guidelines (of the kind that have been expressed in various cases relating to claims by widows, or adult children, or grandchildren) cannot be elevated to inflexible rules and are always subject to the consideration of the particular circumstances of each case, including the size of the estate, any competing claims, the applicant’s conduct and the applicant’s relationship with the deceased (see White JA at [37]; Brereton JA at [106]).

[169] There is, and should be, no predisposition for or against the making of orders for provision for adult children (just as there is, and should be, no predisposition for or against the making of orders for the deceased’s spouse). To approach the matter with such a predisposition would, if nothing else, be inconsistent with the observations of the Court of Appeal (in Steinmetz v Shannon and elsewhere) and inconsistent with the recognition in numerous cases that, in the circumstances of the particular case there at hand, there had been inadequate provision for an adult child (and the making of orders for provision out of the estate for an adult child in the particular circumstances of that case) (see, for example, Stern v Sekers; Sekers v Sekers [2010] NSWSC 59).

[170] Each case must be determined on its merits, whether the applicant for provision be an adult child, surviving spouse, or other dependant; I do not read the observations of the Court of Appeal in Sgro v Thompson as suggesting otherwise (and, as I say, the Court of Appeal in Steinmetz v Shannon makes this clear). As Lindsay J said in Verzar v Verzar [2012] NSWSC 1380 (at [131]), in a passage that has been endorsed by Hallen J in Sreckovic v Sreckovic [2018] NSWSC 1597 (Sreckovic) (at [154]):

Whatever guidance one might draw from analogous cases all analogies, and any guidelines drawn from a pattern of similar cases, must yield to the text of the legislation, the duty of the Court to apply that text to the particular circumstances, and the totality of material circumstances, of each case. Preconceptions and predispositions, comforting though they may be, can be the source of inadequate consideration of the jurisdiction to be exercised: Bladwell v Davis [2004] NSWCA 170 at [12] and [18]-[19] .

Choice of law to be applied

70. As Kalpana’s claim for family provision is for an amount that is substantially greater than the value of the deceased’s actual estate, even if that estate is augmented by a remedy against the defendants for devastavit, the crucial issue in these proceedings is whether the Court must determine Kalpana’s claim on the basis of the proceedings she implemented in this Court under the Succession Act, or whether the only claim she can prosecute is the claim commenced in the Supreme Court of the ACT under the Family Provision Act that has been cross-vested to this Court. That is because it is only in the former case that the Court has power, if the requirements of Part 3.3 of the Succession Act are satisfied, to designate parts of the property of the O’Donnell group of companies as the notional estate of the deceased.

71. The Court is required to choose which are the correct proceedings to determine, which involves the choice of the correct law to apply. Choice of law depends upon the application of the relevant rules of the conflicts of law. Even though Australia is a single country, in various ways the laws of the several States and Territories differ. For disputes governed by State and Territorial law, the States and Territories are treated as if they were separate countries. The conflicts of law rules of this Court, as the forum for the dispute (the lex fori), govern the choice of law. There is no controversy about the content of the applicable rule, which is conveniently set out in M Davies, AS Bell, PLG Brereton and M Douglas, Nygh’s Conflict of Laws in Australia (10th ed, 2019, LexisNexis Butterworths) (Nygh’s) at [38.43], as follows (footnotes omitted, and noting that ‘Testator’s Family Maintenance’ is equivalent in meaning to ‘family provision’):

The relevant principles applicable to jurisdiction in testator’s family maintenance in the absence of legislative provisions are set out in the judgment of Sholl J in Re Paulin:

(a)   The courts of the testator’s domicile alone can exercise the discretionary power arising under the appropriate Testator’s Family Maintenance legislation of the domicile so as to affect his movables and immovables in the territory of the domicile; …

(b)   The same courts alone can exercise such discretionary powers as to affect under the same legislation movables outside the territory of the domicile; …

(c)   The courts of the situs alone exercise such discretionary powers to affect, and then only if there is Testator’s Family Maintenance legislation in the situs providing for it, immovables of the testator out of the jurisdiction of the courts of his domicile; and the courts of his domicile cannot exercise their discretion so as to deal with such immovables; …

72. Brereton J (as his Honour then was) stated equivalent principles in Taylor v Farrugia [2009] NSWSC 801 at [26] and Hitchcock v Pratt (2010) 79 NSWLR 687; [2010] NSWSC 1508 at [6].

73. These principles are now consistent with s 64 of the Succession Act, as it has been in effect from the time of the deceased’s death, which is:

64   Orders may affect property outside jurisdiction

A family provision order may be made in respect of property situated outside New South Wales when, or at any time after, the order is made, only if the deceased person was, at the time of death, domiciled in New South Wales.

74. The application of these principles depends upon the domicile of the deceased at the date of his death, and whether the property sought to be made subject to a family provision order is classified as movable or immovable property for the purposes of the conflicts of law. That classification can sometimes involve complications, but in the present case it is clear that only real estate would be treated as immovable and all other candidate property would be classified as movable property.

75. If the Court finds that the deceased was domiciled in NSW at the date of his death, then this Court has jurisdiction to determine the claim commenced by Kalpana in this Court. For that purpose, the Court would apply the relevant provisions of the Succession Act, and the property that may be made the subject of a family provision order would be any real estate of the deceased in NSW and any movable property of the deceased wherever situated. If the deceased was domiciled in the ACT, then this Court will only be able to make a family provision order under the Succession Act if there is real property in this State that is amenable to being the subject of an order under that Act. I use the word “amenable” because there is authority for the proposition that it is not essential that the deceased be the owner of the real property at the date of his death so that the real property forms part of his actual estate. In Hitchcock v Pratt, Brereton J (as his Honour then was) held at [20] that, if there is real property situated in this State that can be designated as notional estate under Part 3.3 of the Succession Act, that property may attract the jurisdiction of this Court even if the deceased was domiciled elsewhere, “since once designated it assumes for practical purposes equivalence to actual estate”. If that is right, this Court will have jurisdiction to make a family provision order under the Succession Act against real property in this State that is not part of the estate of the deceased if it is treated as the deceased’s notional estate.

76. However, if the deceased was domiciled in the ACT then, absent real property in this State that is part of the actual estate of the deceased, or may be designated as part of his notional estate, only the Supreme Court of the ACT has jurisdiction to make a family provision order. In this case, that jurisdiction and the proceedings in that Court have been cross-vested to this Court. In the determination of the ACT proceedings, this Court would have to apply the Family Provision Act, which does not possess the notional estate provisions of the Succession Act. The Court would be left to fashion a family provision order over real property in the ACT and any movable property of the deceased wherever situated.

Property available for designation as notional estate

77. If the Court has jurisdiction to hear Kalpana's claim under ss 59 of the Succession Act, it will have power to make an order designating property as notional estate of the deceased under Part 3.3 of that Act.

78. As Mason P said in Kavalee v Burbidge (1998) 43 NSWLR 422 (Meagher JA agreeing and Handley JA dissenting in part) at 441 concerning the substantially equivalent provisions of the Family Provision Act1982 (NSW), which were replaced by Chapter 3 of the Succession Act:

A court approaching the interpretation of the notional estate provisions is at once confronted with a legislative scheme which is both beneficial to applicants and restrictive of the existing property rights of disponees. And it uses both technical legal terms and expressions of indeterminate reference.

Possible basis of relevant property transaction

79. The explanation of the application of Part 3.3 that follows will be assisted by a description of the relationship between the deceased and the O'Donnell group that relevant authority suggests may justify the Court in making a notional estate order in respect of the property of those companies. Relevantly:

510. Mr Findlay's statement contained an assertion that, in around 2008, he sold a property at Northbridge in Perth for $650,000. Mr Findlay said that he gave Kalpana the net proceeds that he received on the sale on the understanding that she would buy a property that she would hold on trust for Toby in the future. Given the limited basis upon which the statement was received into evidence, it was not, at the time of tender, capable of corroborating Kalpana's claim. Mr Findlay was cross-examined on the content of his statement dated 22 March 2019 in a manner that caused him to confirm it, so it was effectively cross-examined into evidence.

511. Mr Findlay appeared to be a straightforward witness who gave his evidence candidly and acknowledged when he could not recall events that he was involved in many years ago. He said that he could not at all recall a transfer of property that he signed in favour of Kalpana's mother. Mr Findlay said that he never owned the property and could not recall the transfer, although it bore his signature. This event apparently occurred in about December 1998. Mr Findlay was not able to give any explanation for the transfer, and said that he did not have the remotest idea what the explanation was.

512. Following his divorce from Kalpana, the couple reached a property settlement in October 1999. Mr Findlay said that the marital property settlement had nothing to do with his later sale of the Northbridge property and his transfer of most of the sale price to Kalpana to buy a property to be held on trust for Toby.

513. Mr Findlay confirmed the evidence in his 22 March 2019 statement that he sold the Northbridge property because Toby was relocating from Perth to Canberra. Mr Findlay said that he did not need the property so he sold it and sent the money to Kalpana. This occurred in 2010. The sale price was about $640,000. On 4 October 2010, Mr Findlay transferred $530,000 to Kalpana's bank account. He did not speak with Toby at the time about the transaction. He had minimal contact with Kalpana on the subject. Mr Findlay said that he just told Kalpana that the property had been sold and he was sending her the money, and that she should buy Toby a property when she saw fit. Mr Findlay acknowledged that Toby was about 24 at this time and he was doing well in Canberra, and had purchased a couple of units. Mr Findlay acknowledged that Toby was a capable adult, but he wanted a "backup" for Toby. Mr Findlay explained why he did not give the money directly to Toby by saying that men of Toby's age are "not set in your relationships," and that "men don't get mature that easily". Mr Findlay said that he gave the money to Kalpana because he trusted her to look after their son.

514. The cross-examination of Mr Findlay concluded at [T 564.10-38] as follows:

Q. You'll recall that I've asked you questions about the transfer of the Beechboro Road property to Kalpana's mother.

A. Yes.

Q. I suggest to you that that was part of the deal, part of the Family Court settlement that you had with Kalpana; what do you say about that?

A. It was not.

Q. You deny that but you haven't been able to give any explanation at all as to why you transferred that property to her mother; correct?

A. Right.

Q. I suggest to you it was part of the deal and it was intended to be Kalpana's property; what do you say about that?

A. There was nothing in any document to indicate that, and it was not part of the settlement, no.

Q. You deny that quite strongly but you have not been able to provide any explanation at all as to why you would have transferred the property to her mother?

A. I told you I have no idea about it because I have never owned that property.

Q. And I suggest to you that the money you gave to Kalpana, transferred to Kalpana in October 2010 was some arrangement with Kalpana rather than a gift intended for Toby?

A. That's your assumption.

Q. And you deny that, do you?

A. I told you why I did it.

516. In final submissions at [T 768.9], the defendants' senior counsel said: "Now, I hasten to add, I am not suggesting that Mr Findlay is lying about what has happened, but there is a distinct undercurrent in the evidence on the plaintiff, Kalpana, that some really weird stuff is just not being fully explained to your Honour."

517. The defendants submitted that this transaction was mysterious, the explanation convoluted, and there were unexplained, curious aspects of the transaction. That may be so. However, although there are unusual features of this transaction, I accept Mr Findlay as a witness of truth, and that the transaction occurred substantially in the manner stated in his evidence. The payment by Mr Findlay to Kalpana occurred in October 2010, more than 10 years after the marital property settlement in October 1999. No challenge was made to Mr Findlay's evidence concerning the matrimonial property available to be shared between himself and Kalpana at the time of the property settlement. Mr Findlay purchased the Northbridge property in about 2004. There was no objective reason for Mr Findlay to make a gift to Kalpana personally of the proceeds of sale of the property in October 2010.

518. Kalpana said, in par 159 of her affidavit, that she had previously had a bank account with the sum of $550,411 in it that she had transferred to Toby "a few weeks ago". Kalpana gave the following explanation of why she paid the amount in her bank account to Toby:

… This partly represented the income that was received for the property I purchased on trust for Toby, which had been leased out. Clive had always said to me, and I agreed, that any income received for the property would be held on trust for Toby. I transferred the entire amount to Toby a few weeks ago. The additional amount was gifted to him as he is getting married this year, and I wanted to give him a head start in life.

519. In relation to the payment of the sum of $550,411 to Toby, Kalpana did not provide any records that established the amount of the rent that had been received for Unit 30 and it is not clear what proportion of the amount paid is claimed to represent rent or the additional amount that was a gift.

520. Toby affirmed an affidavit on 24 July 2019 that contained evidence in support of Kalpana's claim that the deceased was domiciled in NSW. It did not deal with the transfer of the unit or the payment of the money to Toby. In cross-examination, Toby acknowledged that on 11 January 2019, Kalpana transferred to him the sum of $550,441.50. Toby said that the reason given to him by Kalpana was the result of an obligation imposed upon Kalpana as a result of her divorce from Mr Findlay.

521. The evidence demonstrates that, on 23 January 2017, the deceased wrote a cheque in favour of cash for $900,000. The cheque butt records the $900,000 as being for the purchase of Unit 14. Kalpana presented the cheque on 23 January 2017 and it was credited to her Commonwealth Bank of Australia (CBA) account. Further, on 23 January 2017, Kalpana transferred that money to her company Milan Fashion & Shoes Pty Ltd, as a payment described as "director injection". Between 8 February 2017 and 9 November 2017, Kalpana made various withdrawals totalling $876,000. One of those withdrawals was the sum of $500,000 on 8 November 2017. The other withdrawals were apparently for the purpose of the retail business. On that date, Kalpana opened a term deposit with the CBA in the sum of $500,000. On 5 January 2019, Kalpana terminated the term deposit and transferred the amount and accumulated interest of $512,004.49 into an account in the name of Kalpana and her mother. That happened after the date of the mother’s death. On 11 January 2019, Kalpana transferred out of that account the sum of $550,441.50 to Toby. It is clear that the source of the money paid to Toby was originally the $900,000 that the deceased paid to Kalpana on 23 January 2017 in return for the transfer of the title to Unit 14 to him. That fact is not necessarily inconsistent with Kalpana having received rent for Unit 30 and, having spent that money for her own purposes, her applying the money received from the deceased to substitute for the money that she claimed she was holding on trust for Toby. However, the fact remains there was no objective evidence to prove the amount of any rent received by Kalpana for Unit 30.

522. There was one further incident of Kalpana being involved in a transfer of property to Toby soon after the death of the deceased. It involved a property in Morley, Western Australia. On 5 February 2019, Kalpana and her sister Pushpanjali Vyas signed a transfer of the property that was in their joint names to Toby for consideration that was expressed simply as being “the desire to make a gift”. Kalpana’s explanation for this transaction was that when Pushpanjali originally wished to buy a property as her home, her credit rating was not sufficiently good to enable her to borrow the balance of the price in her own name. Because Kalpana was in employment, Kalpana agreed to be a joint purchaser and mortgagor to enable Pushpanjali to acquire a home. Kalpana said that the property was not purchased with Kalpana’s money, and that she considered her sister to be the only person entitled to the property. Kalpana said that she participated in the transfer of the property to Toby at Pushpanjali’s request. As I understand it, Kalpana’s position is that she did not think to disclose the transaction in her evidence because she never considered that she had any interest in the property. Pushpanjali has continued to occupy the property as her home.

523. Asked in cross-examination about the 5 February 2019 transfer to him of the property in Western Australia, Toby said that he believed his aunt had transferred the property to him. He did not recall that Kalpana was also a transferor. Toby gave the following explanation at [T 262.1-11]:

Q. And no consideration was paid by you for the transfer of that unit; correct?

A. Correct. So with that unit it was something that my aunty called me about. She could see that - she didn’t want the family to be arguing around what was happening with that unit if she passed away. She wanted to make sure that her wishes for what happens to the property when she passes away actually happens. I’m the only grandson on that side of the family so she organised to transfer it to me now. However, I didn’t need to pay anything because she still lives there, she still runs the property; it’s just in my name so that if anything happens to her, there’s no real arguments over what happens to the property.

524. Toby added at [T 263.19-24]:

Q. You got the property at Morley for no payment; right?

A. Correct. But I also don't - I don't see myself as getting the place in Morley. It's still my auntie’s house. She still lives in it. The bills are paid for through the rent. It's a duplex arrangement. So the front property pays for the whole thing. It's old. I'm doing this - I'm just a name on the title. She still lives in it and it's still her house.

525. Pushpanjali was cross-examined about the circumstances in which the Morley property was transferred to Toby in February 2017 at [T 266.46-268.50] (which I have edited for brevity):

Q. Ms Vyas, in February 2019 you transferred with your sister Kalpana your interest in a property at 3 Weir Place, Morley to Tobias, your nephew; correct?

A. Yes. Yes, sir.

Q. Why did you do that?

A. Because I paid my loan off to the bank and since my sister Kalpana was on my property on the title for the bank purpose to get a loan from the bank to build a granny house at the back of my house to look after my mother who had aneurism and she was almost bedridden, so I was afraid she would go into a nursing home or something, so I planned to build this granny house, wanted a loan so I took a loan from the bank and she was on the title. And once I had the money to pay off the loan, she need not be on my title any more.

…

Q. Why did you transfer the [Morley] property to Toby? He had nothing to do with anything that you’ve just described.

A. Because I have no children and it is my intention always I’ve had that in mind that my property will go to Toby, and that’s why I have decided that before I die or anything like that I want to be sure what happens to my property, that no-one else comes to fight for my property in the process of my death, and they ask for a share or anything like that, and it is in Toby’s name. But I have lived in this property since 20 years and I’m living in this property now, and I will live in this property till I’m 100 or whatever, till I die, and that is what going to happen in my property. But the property is in my nephew Toby’s name in case something happened to me, that’s all.

…

Q. And Kalpana had a share in that property, right?

A. She had no share except her name being on the title.

Q. You agree that her name had been on the title to the property; right?

A. Yes, because to secure a loan I needed her name to be on the property; otherwise I could not get a loan without her showing the income that if - because I had no income to get a loan. So that’s why I asked my sister because I want to build a granny house for mum so, “Can you help me?” So she said yes. So she went on the loan and that’s all, it’s on the loan. It's not her property; it’s my property because the - I took a loan. The house I lived in had no loan at all. It was - there was no loan; it was all completely paid off my house. It’s only when I needed a small bit of money to build the granny house, I borrowed the money from the bank and that’s when she went on the title. Before that I was the sole owner of the property. There was no-one else on the property, and it was - there was no loan on the house.

Q. So is there some arrangement that the property might come back to you?

A. Property might come back to me? It could come back to me if I see - I mean, I don’t know but I’m undecided. There’s no reason for it to come back to me because I don’t see - I don’t - I mean, I trust Toby. He will take care of the property but if he does not take care of the property, I mean - and in case I feel suspicious I can always take my property back on my name.

Q. Did Kalpana say to you in February 2019 that she needed to get some property out of her name?

A. Out of her name? I would - no, Kalpana didn’t say anything about property and getting - her name getting out or anything like that. It’s my property. I decide what to do.

526. Although there are obvious unusual features of this transaction, I accept the evidence given by Kalpana and Pushpanjali that Kalpana had no beneficial interest in the property and that is the reason why the transaction was not referred to in Kalpana’s evidence.

527. I now turn to the issue of Kalpana’s financial position at the time of the hearing. By that time, the Ferrari had been sold for $210,000, and the proceeds applied towards Kalpana’s general funding needs. Kalpana said at par 17 of her affidavit in respect of the proceeds of sale of the Ferrari: “I have since used that money to support my maintenance and lifestyle I had with my husband.” The Court can only observe that it has been a matter for Kalpana to determine the wisdom of expending her available funds on the basis that she will be able to maintain the lifestyle that was provided for her by the deceased.

528. Up to the time of Kalpana’s updating affidavit on 30 September 2021, Kalpana had received an estimated $356,000 from the executors by way of interim provision. She was being paid $3,000 a week on a continuing basis.

529. Kalpana gave evidence of her liabilities by reference to a spreadsheet that she said was prepared by her accountant. The total is stated at $451,462 made up of $303,262 borrowed from family members and acquaintances, $48,200 in rent on her Sydney residence and $100,000 that was paid to break the lease of the premises from which Kalpana operated her fashion shop in Manuka through Milan Fashion & Shoes Pty Ltd which was guaranteed by Kalpana. I note, however, that in par 14 of her affidavit Kalpana appears to say that the total surrender costs were $66,000.

530. Kalpana stated her assets as being:

• Porsche Macan GTS: estimated $65,000.

• Superannuation: $753,000.

• Additional superannuation: $38,300.

• Cash in bank: $534.56.

• Personal and household possessions: $20,000.

531. The defendants made a submission that Kalpana’s company, Milan Fashion & Shoes Pty Ltd, owes three debts to companies in the O’Donnell group that total $996,236. It is not apparent to me that the defendants have proved the existence of those debts, but I would infer that the debtor is insolvent, and it has not been shown that Kalpana guaranteed the debts. If the payments were made to Kalpana’s company by the deceased out of the funds of O’Donnell group companies, they are likely to represent the funding disclosed by Kalpana that she understood was made by the deceased personally.

532. The defendants submitted that the Court should assess Kalpana’s claim for family provision on the basis that Kalpana had enjoyed the benefit of four properties owned by the deceased’s estate or companies in the O’Donnell group after the death of the deceased and before the defendants could obtain possession of the properties, which at least in some cases required a court order. The defendants valued the benefit at $310,000 for 124 weeks’ possession of the Barton penthouse, $114,000 for 38 weeks’ possession of the Pyrmont apartment (owned by Evenlong Pty Ltd), $18,840 for 24 weeks’ possession of Unit 14, and $12,702 for 25 weeks’ possession of a unit at Fyshwick in the ACT. I do not accept that these amounts should all be treated as benefits for which Kalpana should account. In the aftermath of the death of the deceased, Kalpana acted for a period as if she should be entitled as his widow to residential accommodation that conformed with what she had enjoyed during her marriage. I accept that Kalpana should be treated as having enjoyed the benefit of rent-free accommodation in one of the properties until the defendants succeeded in having her thrown out of all of the homes that she had enjoyed at one time or another. However, whatever may be the appropriate value to be attributed to that benefit, it is immaterial in the scheme of things.

533. The relevant circumstances of the deceased’s children as beneficiaries under his will have been accurately summarised in pars 483 to 543 of the defendants’ final written submissions. It is not necessary to set out that summary in these reasons. It is plain that the deceased had a loving relationship with all of his children and that they are worthy recipients of his testamentary beneficence. The material and financial circumstances vary between the beneficiaries, with the daughters being relatively better off than the sons. Simon has a particular need for his inheritance because of his and his partner’s medical condition and the needs of Simon’s daughter from a previous relationship, who has cerebral palsy and needs substantial care.

534. The evidence as to the needs of the beneficiaries must be considered, however, in the context that the executors are now in control of Duboti Pty Ltd as trustee of the Mugga Way Family Trust, as Jaimie was appointed a director of that company on 21 November 2014 and the other three executors were so appointed on 11 February 2019, according to an ASIC search dated 6 August 2019. As at that date, the deceased was still recorded as owning 49 shares in the company beneficially and 51 shares non-beneficially. The executors now have the right to control the exercise by Duboti Pty Ltd of its absolute discretion in relation to the distribution of the profits and capital of the Mugga Way Family Trust. The executors are also able to control the individual companies and trusts in the O’Donnell group, save in any case where a third party has equal control of a company. The executors are already directors of the significant companies in the O’Donnell group that are wholly controlled by Duboti Pty Ltd. The defendants did not make any submission that casts doubt on their ability to control the O’Donnell group and the Mugga Way Family Trust.

531. As I understand the effect of the deceased’s will, his executors are required to divide his estate equally for each of his children and to transfer each allocated part to the trustee of each child’s testamentary trust: see schedule 1 clause 3. The practical result should be that each child of the deceased should have become entitled to an equal share of the deceased’s actual estate under the will. Provided that they continue to cooperate, they should be able to share between themselves equally the benefits of ownership of each part of the deceased’s estate. That would include the deceased’s shares owned beneficially in Soothink Pty Ltd, which is an income and capital beneficiary of the Mugga Way Family Trust. The beneficiaries are able to control the board of directors of Soothink Pty Ltd and cause profits to be distributed by dividend or to wind up the company and divide its property between them. As children of the deceased, the beneficiaries are individually income beneficiaries under Item 6(2)(h) of the Mugga Way Family Trust deed.

532. In principle, these observations are subject to qualification by reason of the fact that clause 11 of the Mugga Way Family Trust deed empowers the Appointor to appoint and remove trustees by deed at any time. At the date of the deceased’s death, his accountant, Mr Stephen Bray, was the Appointor. It may be that on the proper construction of Item 8 of the Schedule to the deed, Fiona became the Appointor upon the deceased’s death.

533. There was no evidence that Duboti Pty Ltd had been replaced as trustee or that there was any likelihood that a new trustee would be appointed. Nor was there any evidence as to how the beneficiaries intended to operate the Mugga Way Family Trust in the future, and what benefits the beneficiaries could hope to receive by that process. In the circumstances, it is reasonable for the Court to infer that each beneficiary, by and large, can expect to enjoy an equal share of an asset that has been valued at between $28,170,236 and $32,720,859, which means that each of the beneficiaries has received under the deceased’s will a benefit that should be valued in the order of $6 million.

534. In par 108 of Kalpana's written closing proceedings she set out the order for further provision that she seeks as follows:

• Accommodation (comparable to the Pyrmont apartment): $5,600,000;

• Stamp duty: $329,000;

• Capital fund: $3,000,000;

• Repayment of debts: $542,248.90;

in addition to the provision already paid.

539. In response, the defendants submitted in the oral submissions of their senior counsel that any order for family provision that is made in favour of Kalpana, on the basis that the deceased is found to have been domiciled in the ACT such that the order can only be made in respect of his actual estate, should be limited to the transfer of Unit 14 to Kalpana for the purpose of her accommodation, plus a fund valued at between $700,000 and $1,000,000, "which would effectively consume the estate": [T 751.45]. Senior counsel added at [T 752.3] that the consequences would be: "One is that the executors would effectively have their costs dealt with outside of the estate; two, that the plaintiff's legal costs, if they were to be paid, would effectively consume the benefit."

540. It is obvious that the Court cannot make the family provision orders sought by Kalpana, given its finding that the deceased was domiciled in the ACT at the time of his death. Given, on the findings that I have made, that the beneficiaries under the deceased's will have control over the O'Donnell group and the Mugga Way Family Trust, I am satisfied in principle that, as between Kalpana and the beneficiaries, a family provision order should be made in Kalpana's favour that gives her the whole of the remaining actual estate of the deceased, subject to the effect of the costs orders that may be made.

541. Given the observations made by senior counsel for the defendants that I have recorded above concerning the defendants' costs, I consider that it would be a fair outcome, on the facts of this case, for the Court not to make an order that the defendants' costs be paid out of the estate of the deceased.

542. I should add that, if I had found that the deceased was domiciled in NSW at the date of his death, I would have made an appropriate order designating part of the property of the O'Donnell group as being notional estate of the deceased that was sufficient to satisfy the family provision order and the order for payment of Kalpana's costs that I would have made on that basis. As explained above, I would have given the defendants the opportunity to consider the most appropriate formulation of the notional estate order to be made.

543. I would not, however, have made the family provision order that Kalpana has sought and that I have set out above. I consider that family provision in that amount would have been excessive, given the length of the marriage between Kalpana and the deceased and the fact that Kalpana did not in any way contribute to the acquisition of the deceased's wealth. While I am satisfied that the standard of living that the deceased funded during the period of his marriage to Kalpana is relevant to the value of the family provision order that would be justified in Kalpana's favour, I am not satisfied that Kalpana is entitled to expect anything like the continuation of the lavish lifestyle that she enjoyed. I accept that the deceased led Kalpana to understand that his wealth was in practical terms limitless, but the reality is that the level of the deceased’s expenditure required him to ‘raid’ the resources of the O’Donnell group in a manner that was not prudent or sustainable, if the businesses operated by the group were to remain financially sound. Although the actual level of expenditure by the deceased on his lifestyle with Kalpana is relevant to the determination of what is adequate provision for her proper maintenance, it does not follow that Kalpana is entitled to expect the continuation of a lifestyle that was not sustainable and prudent. It is also relevant that the source of the money that Kalpana transferred to Toby after the death of the deceased was money paid to her by the deceased.

544. If I had found that the deceased was domiciled in NSW at the date of his death I would have made an order that Kalpana be paid a lump sum out of the deceased’s estate and notional estate in the sum of $5 million, as well as an order that her costs on the ordinary basis be paid likewise. A factor that I would have considered to be significant is the access to the superannuation that Kalpana will enjoy when she reaches the age of 65.

Conclusion

545. The result is a family provision order will be made in favour of Kalpana in the proceedings that she commenced in the Supreme Court of the ACT that will give her all of the property in the actual estate of the deceased that is available to be distributed. Kalpana’s claim for family provision commenced in this Court and for relief in respect of the claimed devastavit by the defendants will be dismissed. All of the claims made by Anna, Kristina and Jurek will be dismissed.

546. Given the interrelationship between the proceedings it will be necessary for the Court to receive submissions from the parties as to the costs orders that should be made.

547. As there may be some complexity in the formulation of the orders that should be made in favour of Kalpana, I will also receive submissions from Kalpana and the defendants as to the form of the orders that should be made in favour of Kalpana.

548. My Associate will arrange with the solicitors for the parties in the new law term for a directions hearing to deal with all outstanding issues next year.

Need for law reform

549. The outcome of these proceedings causes me respectfully to recommend that all of the authorities in this country who have a role in law reform revisit the question of whether the family provision legislation in each jurisdiction should empower the courts of those jurisdictions to designate notional estate of deceased persons and to explore the possibility of introducing substantially common legal provisions for that purpose.

550. Kalpana has succeeded in obtaining an order for further provision out of the estate of the deceased, but not for the amount that I have determined would have been fair to her. Given all of the circumstances of the case, that is because fairness could only have been achieved if the Court had been empowered to make an order designating part of the property of the O'Donnell group as notional estate of the deceased. The absence of that power turned on the issue of the domicile of the deceased at the date of his death. The finding that the deceased was domiciled in the ACT was fatal to the prospect of fairness being achieved in this case.

551. As Brereton JA has said extrajudicially:

In my view, the proper measure nowadays of the community's expectation as the basic minimum which testators should provide for their spouses, even in an unhappy marriage, is that provision which the surviving spouse would have received pursuant to Part VIII of the Family Law Act had the parties separated and instituted such proceedings. In a happy marriage, the standard might well exceed this … The dutiful spouse who finds upon her husband's death that no or inadequate provision has been made for her is then in no worse position than a spouse who has separated before death and commenced property proceedings. …

There is neither social sense nor legal logic in a surviving spouse who has not instituted proceedings before the other dies being in a position worse than would have been the case had such proceedings been instituted. Even more so where the surviving spouse was not separated but remained happily married until the death of the other, should such spouses not be in a worse position vis-a-vis the estate of the other than had the marriage failed …

If the outcome did in fact depend upon the chance of whether property proceedings had or had not been instituted before death, or resulted in a 'dutiful' spouse who remained happily married to the deceased being worse off than if he or she had separated from the other, there would be justifiable cause for complaint.

552. See P L G Brereton, “Where Death and Divorce Meet: The Intersection of Family Provision and Family Law” (Speech, National Family Law Conference, October 2006 at 19, 24 and 37), cited in the Tasmanian Law Reform Institute, Final Report No. 27: Should Tasmania Introduce Notional Estate Laws? (September 2019) at [5.6.13-14].

553. The circumstances of this case speak eloquently of the difficulty and expense that may sometimes be involved in determining the domicile of a deceased person, particularly within a federation such as Australia, where freedom of movement may lead to a dispersal throughout the country of persons who live in one State or Territory but are domiciled in another. It may be thought that the legitimate sovereignty of each State and Territory justifies bespoke succession laws, but the fact that succession to movable property is governed by the deceased person's domicile means that persons who are domiciled in one State or Territory will largely carry the succession laws of that State or Territory with them wherever they may live in the country. Although domicile is a characteristic of every person, it is a concept that is probably unknown to almost all members of the community. Even where it is known, it may not be readily ascertainable except in clear cases. The effect is that people carry their personal law around with them with consequences that may be hidden from others to which they become related.

554. The result is that there will be many persons who live for long periods in this State whose property will be governed by the succession laws of some other State or Territory. Persons who become related to such persons may be oblivious of the consequences.

555. There is a case for the law reform authorities to consider the consequences of these circumstances. There is a case for uniformity of succession law, at least for the purpose of protecting the interests of core relations such as spouses and equivalent partners and children. The sovereignty of the several States and Territories could be accommodated if they wished to differ in respect of their family provision laws as to the rights of claimants more indirectly related to a deceased person.

556. It is a surprise to learn that Victoria and South Australia have simply rejected the proposal of uniformity with the notional estate provisions in the New South Wales legislation, and Tasmania has proposed to defer introducing uniformity until all other States and Territories do so. The position is explained in the Final Report No. 27 of the Tasmania Law Reform Institute referred to above.

557. These remarks should not be understood as a plea to the other States and Territories to surrender and to introduce the equivalent of Part 3.3 of the Succession Act into their own family provision laws.

558. As Prof Rosalind F Croucher said in her article “Towards uniform succession in Australia” (2009) 83 ALJ 728 at 740, referring to a report of the National Committee on Uniform Succession Laws (footnote omitted):

What is curious – to me at least – is that there was apparently no discussion in the National Committee's work of the model of the claw-back property provisions. The New South Wales provisions are used because they are there and have been in force for a while now to see if there is anything hugely wrong with them. It is a convenient – and pragmatic – approach to law reform, in sticking to the familiar.

But the model has always bothered me. For a start, it is based on the old New South Wales death duty provisions. There the formula was a complex one, the end result of which was just to determine – precisely – the dutiable value of assets on death. It was not about attaching property in any way and, hence, served a different purpose. In the family provision context the question is to give an expanded definition of property that might be considered in weighing up provision for family members. A precisely formulated scheme, like that of death duties placed the emphasis in the wrong place – for family provision purposes…

559. I respectfully agree. The notional estate provisions should be written in language that is intelligible to competent suburban solicitors who do not specialise in succession law. The language of Part 3.3 is abstruse and abstract and Part 3.3 is, in my view, a matrix of interlocking statutory provisions that do not harmonise in a way that facilitates their application.

560. As it is clearly the case that Part 3.3 of the Succession Act is a major barrier to the other States and Territories moving to achieve a reasonable level of commonality in the family provision laws of all of the States and Territories, there is a case for the law reform authorities of this State to revisit the issue of the reform of Part 3.3.

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Decision last updated: 16 December 2022