Osborne v Stewart

[2020] NSWSC 507

Supreme Court

New South Wales

Medium Neutral Citation:

The Estate of Terence Byrne; Osborne v Stewart [2020] NSWSC 507

Hearing dates:

In Chambers and on the papers

Date of orders:

08 May 2020

Decision date:

08 May 2020

Jurisdiction:

Equity

Before:

Hallen J

Decision:

The Court:

 

1. Orders that the Will dated 4 September 2015 of Terence Michael Byrne (the deceased) be rectified by including after “insurances thereon” in Clause 3 thereof the words:

 

“…and after the death of the said MARCIA ROBIN OSBORNE, to my children and if more than one in equal shares as tenants in common, for their own use and benefit absolutely provided that they survive me for a period of Thirty (30) days and IN THE EVENT that any of them fail to survive me and attain a vested interest but leaving children THEN I DIRECT that such children shall take the share his her or their parent would have taken upon their attaining the age of eighteen (18) years and if more than one in equal shares as tenants in common.”

 

2. Orders subject to compliance with the Probate rules of Court that the Will dated 4 September 2015 of the deceased, as rectified, be admitted to Probate.   

 

3. Orders that Probate of the Will dated 4 September 2015 of the deceased, as rectified, be granted to the Plaintiffs.

 

4. Orders that the matter be remitted to the Senior Deputy Registrar in Probate to complete the grant.

 

5. Makes no order as to the costs of any party to the intent that each will bear her, or his own costs, respectively, of the proceedings.

 6. Orders that the directions hearing before the Succession List Judge on 11 May 2020 be vacated.

Catchwords:

SUCCESSION – Probate and administration – Rectification of wills – Where Will does not carry out the testator’s intentions because the will does not give effect to the testator’s instructions – Claim for rectification of Will under s 27 of the Succession Act 2006 (NSW) – Principles relevant to rectification –Where instructions for the Will given by deceased to his solicitor – Whether the Will does not give effect to the deceased’s instructions

Legislation Cited:

Succession Act 2006 (NSW), s 27
Wills, Probate and Administration Act 1898 (NSW), s 29A

Cases Cited:

Estate of Aspasia Kandros [2019] NSWSC 757

Category:

Principal judgment

Parties:

Marcia Robin Osborne (First Plaintiff)
Kirry Elizabeth Toose (Second Plaintiff)
Phillippa Kim Stewart (First Defendant)
Jayne Deborah Morton (Second Defendant)
Anthony James Byrne (Third Defendant)
Michelle Lois Byrne (Fourth Defendant)

Representation:

Counsel:
P P O’Loughlin (Plaintiffs)

  Solicitors:
Atkinson Vinden (Plaintiffs)
Teece Hodgson & Ward (Defendants)

File Number(s):

2020/00022483

JUDGMENT

Introduction

1. HIS HONOUR: This is an application for rectification of the Will dated 4 September 2015 of Terence Michael Byrne (the deceased). The applicants are Marcia Robin Osborne, a person with whom the deceased was living in a de facto relationship at the time of his death, and Kirry Elizabeth Toose, who is a, now adult, child of the deceased. Both are named as the executors in the deceased’s Will. They also seek an order for Probate of the Will, as rectified.

2. Without intending to convey undue familiarity or disrespect, and for clarity and convenience, I shall refer, hereafter, to the parties, and family members, after introduction, by the name used by the family members.

3. Because there was really no dispute about the facts, or the law that is to be applied, because the application was made within time, and because the only person who is adversely affected by the orders to be made has joined in the bringing of the proceedings, I have dealt with the matter in Chambers and on the papers. There was no opposition by the legal representative of either party to this course.

4. I am grateful to Mr P O’Loughlin of counsel, who appeared for the Plaintiffs, for the written outline of submissions provided to the Court.

Background Facts

5. The deceased died on 1 April 2019, aged 89 years, leaving property in New South Wales leaving surviving him Marcia and his five children, namely Kirry, Jayne Deborah Morton, Anthony James Byrne, Michelle Lois Byrne, and Philippa Kim Stewart. Each of those children, other than Kirry (who is named as a Plaintiff), is named as a Defendant in the proceedings.

6. The deceased’s Will was duly executed by him in the presence of Derek Richard Wybrow and Lorraine Wearne, the solicitor who took instructions for, and who drafted, the deceased’s Will. Each has made an affidavit of attesting witness, affirmed on 24 April 2020.

7. So far as is relevant, the deceased’s Will provided:

“3.    I GIVE a life interest in my primary residence at the date of my death to my partner MARCIA ROBIN OSBORNE subject to her paying all rates, taxes and insurances thereon.

4.   I GIVE DEVISE AND BEQUEATH the rest and residue of my estate … to my executors and direct them to pay the same as follows:

a.   One-half (1/2) to my partner MARCIA ROBIN OSBORNE for her own use and benefit absolutely PROVIDED THAT she survives me for a period of Thirty (30) days …

b.   One-half (1/2) to my children and if more than one in equal shares as tenants in common for their own use and benefit absolutely provided they survive me for a period of Thirty (30) days …”

8. Each of Marcia and the five children of the deceased survived the deceased by a period of more than 30 days.

9. At the time of his death, the “primary residence” of the deceased was a home situated at Stratton Place, North Turramurra (the Turramurra property). Title to the Turramurra property was registered in his sole name. It is said to have a value of about $1.6 million.

10. The effect of Clauses 3 and 4 of the deceased’s Will, as drafted, is that Marcia would be entitled to a life interest and then on its termination, a one half share of the remainder in the Turramurra property, whilst the deceased’s five children would be entitled to share equally the other one half interest in the remainder in the Turramurra property on the termination of Marcia’s life interest.

11. Marcia has five children by a prior relationship, being Grant Michael Osborne, Scott Gerard Osborne, Craig John Osborne, Rebecca Jane Kelly and Aleisha Ann Cossettini. There is evidence that each has been served with a Notice of the Proceedings, although it is difficult to see why each would be a person who may be affected by the rectification of the Will of the deceased, since their mother, Marcia, survived the deceased by more than 30 days.

The Evidence

12. There appears to be no dispute between all of the parties, and also, if relevant, Marcia’s children, that the deceased’s Will requires rectification. It is clear from the evidence of Ms Wearne, the solicitor who drafted the Will that it does not carry out the deceased’s intentions because it does not give effect to his instructions.

13. Ms Wearne’s evidence is found in an affidavit, also affirmed by her on 24 April 2020. Her evidence, relevantly, includes:

1. She was introduced to the deceased by Marcia, for whom she had undertaken legal work, prior to 4 September 2015.

2. She made clear to the deceased that he was free to use another solicitor of his own choice, but he indicated that he wished her to act for him in the preparation of his Will.

3. Shortly prior to 4 September 2015, she met with the deceased and Marcia and took instructions from each in relation to the preparation of his and her Will, respectively.

4. She prepared a File Note of the instructions given to her by the deceased. I shall return to the contents of that File Note.

5. She prepared a Will for the deceased “believing it to be in accordance with” his instructions.

6. She understood that her instructions from the deceased were to the effect that Marcia was to receive a life interest in the principal residence of the deceased together with one half of the residue of the estate available at the time of his death, but no interest in the principal residence in remainder, the whole of which interest was to pass to the deceased’s children.

7. She conceded that “my drafting has failed to achieve this outcome”.

14. The File Note prepared and retained by Ms Wearne supports the nature of the instructions given to her by the deceased. The notes are handwritten and are headed “Terence Michael Byrne xxx Nth Turramurra. 2074”.

15. Beneath that are the words:

“Life interest in [the Turramurra property].

Contents of house Marcia

Pay outgoings then kids

50% of residue to Marcia

5 child then

Grandchildren”

16. Marcia, who appears from Ms Wearne’s affidavit evidence to have been present when the deceased gave instructions to Ms Wearne (at the behest of the deceased), supports the claim for rectification (as she is a Plaintiff in the proceedings).

17. The Statement of Claim, which was filed on 19 March 2020, relevantly seeks the following relief:

“1.   An order that the last Will (“Will”) dated 4 September 2015 of the late Terence Michael Byrne be rectified by including after “insurances thereof” in paragraph 3 of the Will the words;

‘…and after the death of the said MARCIA ROBIN OSBORNE, to my children and if more than one in equal shares as tenants in common, for their own use and benefit absolutely provided that they survive me for a period of Thirty (30) days and IN THE EVENT that any of them fail to survive me and attain a vested interest but leaving children THEN I DIRECT that such children shall take the share his her or their parent would have taken upon their attaining the age of eighteen (18) years and if more than one in equal share as tenants in common.’

2.   An order that Probate of the Will as rectified be granted to the Plaintiffs in common form.”

18. The parties are agreed that orders should be made. They request that the matter be remitted to the Senior Deputy Registrar in Probate to complete the grant of Probate of the Will as rectified. They also agree that there should be no order as to the costs of the proceedings.

The Law

19. There was no dispute about the principles that apply in relation to rectification of a Will.

20. Division 3 of Ch 2, Pt 2.2 of the Succession Act 2006 (NSW), is headed “Rectification of wills by Court”. The Division operates to remedy the defects in the court’s power at general law to rectify wills. The previous position, before a similar provision was included in s 29A of the Wills, Probate and Administration Act 1898 (NSW), was that a Court could not rectify a will.

21. Section 27 provides:

(1) The Court may make an order to rectify a will to carry out the intentions of the testator, if the Court is satisfied the will does not carry out the testator’s intentions because:

(a) a clerical error was made, or

(b) the will does not give effect to the testator’s instructions.

(2) A person who wishes to make an application for an order under this section must apply to the Court within 12 months after the date of the death of the testator.

(3) However, the Court may, at any time, extend the period of time for making an application specified in subsection (2) if:

(a) the Court considers it necessary, and

(b) the final distribution of the estate has not been made.

22. The proceedings to rectify have been brought within 12 months of the deceased’s death. It is clear that final distribution of the estate has not been made.

23. I dealt with the principles that apply on the question of rectification in Estate of Aspasia Kandros [2019] NSWSC 757 relevantly at [59]–[66] as follows:

“Importantly, s 27 provides that ‘[t]he Court may’. ‘May’ is permissive; it is not directory, or mandatory. There is nothing in the circumstances contemplated by the section that leads to the conclusion that the Court must rectify the Will.

It is a condition precedent to the exercise of the power in s 27 that the Court be satisfied that the Will does not carry out the will-maker’s intentions and that this satisfaction be based on one of two specified reasons, namely, either that a clerical error was made, or that the Will does not give effect to the will-maker’s instructions.

It is clear, then, that the Court must make findings about the ‘intentions’ of the testator because, until it does, it cannot be satisfied that the Will does not carry out those intentions. Thus, what it was that the will-maker intended concerning the part of the will that is to be rectified must be established. What must be shown is the actual intention, not what the intention probably would have been had the will-maker thought about the matter: Trimmer v Lax; Estate M A Fresen (unrep, NSWSC, Hodgson J, 9 May 1997).

The intention must be examined as at the date of the Will, not the date of death: Re Estate of Spinks; Application of Mortensen and Eassie (NSWSC, Needham J, 22 August 1990, unreported); in the Court of Appeal in Bryan William Mortensen and Elizabeth Gedge Eassie v State of New South Wales (NSWCA, 12 December 1991, unreported), at 5; Rawack v Spicer, at [27]-[28]; and Vescio v Bannister (Estate of the late Betty Tait) [2010] NSWSC 1274, at [14-15].

Rawack v Spicer was cited, with approval, by Barrett J in Long v Long; Estate of Ethel Edith Long [2004] NSWSC 1002. His Honour then went on to say, at [9]:

‘The important point is that the court must be satisfied, according to the balance of probabilities, as to not only a negative proposition (that the testatrix did not intend the will to be in the form it eventually took) but also a positive proposition (that the testatrix intended the will to be in the form for which the plaintiff contends). This is the effect of the statute and, as Sheller JA observed in Mortensen v State of New South Wales (unreported, NSWCA, 12 December 1991), the court’s task is to give effect to the language of the section without paying “over much regard to the principles evolved by equity as part of the doctrine of rectification”.’

Although the standard of proof on the issue is on the balance of probabilities, clear and convincing proof is required: Re Estate of Max Frederick Dippert, at [34]; Rawack v Spicer, at [30]-[31], quoting Hodgson J in Trimmer v Lax at 12-13).

The meaning of ‘testator’s intentions’ was considered (albeit in relation to the former section) in Re Swain (Dawn) [2008] NSWSC 1343, at [25]-[27]:

‘Section 29A refers to the intention of the testator. In Mortensen v New South Wales (NSWCA, 12 December 1991, unreported) Sheller JA, with whom Mahoney and Meagher JJA agreed, said that s 29A:

is available for mistakes, not for lack of vision or perception or knowledge. It is a section directed at mistakes in expressing the testator’s intentions.

In that case the testatrix had made it manifestly clear that she did not want her money to “go to the government” which for all intents and purposes meant she did not want to die intestate. However, there was a failure of one of the gifts she made and the result was that there was a partial intestacy. It was argued that the testatrix’s intentions were that no monies should go to the government, and accordingly the will should be rectified.

The Court of Appeal, like Needham J at first instance, dismissed the application. Sheller JA said that it would seem on the evidence that the will was so expressed as not to carry out the testatrix’s intentions. However, the section does not only require the court to find that fact, but also to find that the court can rectify the will “as to carry out the testator’s intention”. In the Mortensen case even though the intentions were that no monies should pass to the government, the testatrix had not indicated which of the possible options she would wish to pursue had she realised that her primary gift failed.

Accordingly, the will could not be rectified.’

Thus, the three questions posed by s 27 are, first, what were the will-maker’s actual intentions with regard to dispositions in respect of which rectification is sought; second, is the will expressed so that it fails to carry out those intentions; and, third, is the will expressed as it is in consequence of either a clerical error, or a failure on the part of someone to whom the will-maker gave instructions in connection with the will, to comply with those instructions?” (emphasis in original)

24. Unlike in the Estate of Aspasia Kandros, the deceased’s Will in this case has not been the subject of Probate.

25. There can be little doubt, in this case, that the Court should make an order to rectify the deceased’s Will so as to carry out his intentions. There is clear and convincing proof, on the balance of probabilities, to support the claim for rectification. As conceded by Ms Wearne, the Will does not give effect to the deceased’s instructions. Furthermore, Ms Wearne’s recollection is supported by the contents of the File Note, made at the time of the instructions for the preparation of the Will, which reveals the deceased’s actual intentions, which included Marcia having a life interest in the Turramurra property and then that the whole of the remainder interest should pass to the deceased’s five children as tenants in common in equal shares.

26. Ms Wearne is entirely clear about the deceased’s instructions and equally clear that those instructions were not reflected in Clauses 3 and 4 of the deceased’s Will. An error was made transcribing the instructions into the Will with the result that the Will is so expressed that it fails to carry out the deceased’s intentions.

27. Accordingly the application to rectify succeeds and the Court:

1. Orders that the Will dated 4 September 2015 of Terence Michael Byrne (the deceased) be rectified by including after “insurances thereon” in Clause 3 thereof the words;

“…and after the death of the said MARCIA ROBIN OSBORNE, to my children and if more than one in equal shares as tenants in common, for their own use and benefit absolutely provided that they survive me for a period of Thirty (30) days and IN THE EVENT that any of them fail to survive me and attain a vested interest but leaving children THEN I DIRECT that such children shall take the share his her or their parent would have taken upon their attaining the age of eighteen (18) years and if more than one in equal shares as tenants in common.”

2. Orders subject to compliance with the Probate rules of Court that the Will dated 4 September 2015 of the deceased, as rectified, be admitted to Probate.   

3. Orders that Probate of the Will dated 4 September 2015 of the deceased, as rectified, be granted to the Plaintiffs.

4. Orders that the matter be remitted to the Senior Deputy Registrar in Probate to complete the grant.

5. Makes no order as to the costs of any party to the intent that each will bear her, or his own costs, respectively, of the proceedings.

6. Orders that the directions hearing before the Succession List Judge on 11 May 2020 be vacated.

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Decision last updated: 11 May 2020