Pizzey v Pizzey - [2023] VSC 760

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMON LAW DIVISION
TRUSTS, EQUITY AND PROBATE LIST

S ECI 2021 03747

IN THE MATTER of sections 28 and 34 of the Administration and Probate Act 1958

- and –

IN THE MATTER of an application pursuant to r 54.02 of the Supreme Court (General Civil Procedure) Rules 2015

- and –

IN THE MATTER of the will and estate of JASON BENJAMIN PIZZEY, deceased

BETWEEN:

BENJAMIN GEORGE PIZZEY (by his litigation guardian, SARAH JANE NIDDRIE)	Plaintiff
v
GEOFFREY JAMES PIZZEY (as executor of the estate of JASON BENJAMIN PIZZEY, deceased) & ANOR (according to the attached Schedule)	Defendants

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JUDICIAL OFFICER:	Moore J
WHERE HELD:	Melbourne
DATE OF HEARING:	8 June 2023 and 8 August 2023
DATE OF JUDGMENT:	18 December 2023
CASE MAY BE CITED AS:	Pizzey v Pizzey
MEDIUM NEUTRAL CITATION:	[2023] VSC 760

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WILLS & ESTATES – Application for approval of a proposed compromise – Where plaintiff as a minor is unable to consent – Where executor has a conflict of interest and duty – Where plaintiff as sole current beneficiary would receive less than 50% of the estate’s value under proposed compromise – Serious concern as to quantum of costs – Court unable to be satisfied that the proposed compromise is for the plaintiff’s benefit – Application dismissed – proceeding referred for determination on removal of the defendants as executors payment of money into Court and costs – Administration and Probate Act 1958 sections 28 and 34 – Supreme Court (General Civil Procedure) Rules 2015 Rule 15.08(1) – Official Receiver in Bankruptcy v Schultz (1990) 170 CLR 306 – O’Connor v James [2019] VSCA 265 – O’Connor v James [2023] VSCA 274 – Elderfield v TAC (2010) 55 MVR 206 – Fisher v Marin [2008] NSWSC 1357 – Monty Financial Services vDelmo [1996] 1 VR 65.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr S Gannon	Saines & Partners
For the Defendants	Mr J Munro	Cornwalls

HIS HONOUR:

Introduction

The Court has before it an unusual application for approval of a proposed compromise. The plaintiff, who is ten years of age, brings this proceeding by his mother and litigation guardian, Sarah Niddrie, against the executors of the estate of his father, Jason Pizzey. The executors are the first defendant, who is the deceased’s father, and the second defendant, who is a chartered accountant and who has been the first defendant’s accountant for about 25 years.

The plaintiff is the current sole beneficiary of the deceased’s estate under the deceased’s last will made on 22 May 2020. The first defendant asserts that he is owed $509,161.71 from the estate (the Executor’s Debt Claim), nearly 60% of the gross value of the estate approximately $859,948.10. By his originating motion the plaintiff seeks, in broad terms, an inquiry and ‘determination’ of the Executor’s Debt Claim and, ‘insofar as is necessary’, removal of the defendants as executors. The parties have entered into a deed of…

Grounds of appeal

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

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

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

Consideration

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

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

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Details

Case: [2023] VSC 760
Decision Date: 18 December 2023

CaseChat Overview and Summary

In the Supreme Court of Victoria, the plaintiff, Pizzey, sought approval for a compromise that would resolve a dispute concerning the estate of her deceased mother. The defendants, who are the executors of the estate, argued against the proposed compromise, citing a conflict of interest and a potential breach of their fiduciary duties. The central issue for the Court was whether the proposed compromise was in the best interests of the plaintiff, considering she was a minor and the executors had a conflict of interest.

The Court found that the plaintiff, being a minor, was unable to consent to the compromise. Moreover, the executors had a conflict of interest and were unable to act impartially. The compromise proposed that the plaintiff would receive less than 50% of the estate's value, raising concerns about the fairness and reasonableness of the settlement. Additionally, there were serious concerns regarding the quantum of costs involved in the proceedings. The Court was not satisfied that the compromise was in the best interests of the plaintiff, and thus dismissed the application. The proceeding was referred for a determination on the removal of the defendants as executors, the payment of money into Court, and costs.

In reaching its decision, the Court considered several relevant authorities, including the Administration and Probate Act 1958, the Supreme Court (General Civil Procedure) Rules 2015, and several key cases such as Official Receiver in Bankruptcy v Schultz, O’Connor v James, Elderfield v TAC, Fisher v Marin, and Monty Financial Services v Delmo. These authorities supported the Court’s conclusion that the compromise did not adequately protect the plaintiff's interests, given her minority status, the executors' conflict of interest, and the disproportionate settlement amount. The Court emphasised that the primary consideration was the welfare and best interests of the plaintiff in the context of her inheritance.

Orders