Pridham v Pridham
[2010] SASC 204
•6 July 2010
SUPREME COURT OF SOUTH AUSTRALIA
(Civil)
PRIDHAM v PRIDHAM
[2010] SASC 204
Judgment of The Honourable Justice Layton
6 July 2010
SUCCESSION - WILLS, PROBATE AND ADMINISTRATION - THE MAKING OF A WILL - TESTAMENTARY INSTRUMENTS - JOINT AND MUTUAL WILLS
SUCCESSION - WILLS, PROBATE AND ADMINISTRATION - CONSTRUCTION AND EFFECT OF TESTAMENTARY DISPOSITIONS - GENERALLY - WHAT INTEREST PASSES - JOINT TENANCY
REAL PROPERTY - GENERAL PRINCIPLES - INCIDENTS OF ESTATES AND INTERESTS IN LAND - JOINT TENANCY AND TENANTS IN COMMON - JOINT TENANCY - SEVERANCE - OTHER MATTERS
Plaintiff’s father and stepmother had each made wills as husband and wife leaving their residuary estates in equal shares to three of their children including plaintiff and defendant – the residuary included a house property owned in joint tenancy by stepmother and father – stepmother revoked her will after husband's death – stepmother's new will left house property solely to defendant – stepmother died – plaintiff alleges mutual wills with legally binding agreement not to revoke – whether clear and satisfactory evidence to infer mutual wills – whether property held on trust in accordance with alleged binding agreement – alternatively whether joint tenancy of house property severed in equity.
HELD: Evidence neither clear enough, nor satisfactory to infer binding agreement – defendant retains the sole legal and beneficial interest in disputed property – stepmother's conduct was not inconsistent with treating disputed property as joint tenancy – no severance of joint tenancy.
In re Wilford’s Estate; Taylor v Taylor (1879) 11 Ch D 267; In the Estate of Heys [1914] P 192; Szabo v Boros (1967) 64 DLR (2d) 48; Goyal v Chandra (2006) 68 NSWLR 313, distinguished.
Dufour v Pereira (1769) Dick 419; Birmingham v Renfrew (1936) 57 CLR 666; Re Newey (Dec’d) [1994] 2 NZLR 590; Barnes v Barnes (2003) 214 CLR 169; Baird v Smee [2000] NSWCA 253; Hubbard v Mason (Unreported, Supreme Court of New South Wales (Equity), Santow J, 9 December 1997); BC9706574, considered.
PRIDHAM v PRIDHAM
[2010] SASC 204Civil
LAYTON J.
Introduction
The plaintiff is the stepson of Ruby Olive Pridham (“Ruby”) who died on 6 June 2008. He seeks to challenge a will made by Ruby in 1998 which provided that Ruby’s house property at Kadina be left solely to the defendant who was her only natural child. The plaintiff claims that Ruby’s 1998 Will breached a binding agreement which she had with her husband, the plaintiff’s natural father, Leslie Daniel Pridham (“Les”), not to revoke mutual wills made by Ruby and Les in 1993. Those wills provided that the Kadina property be passed after the death of the survivor of Les and Ruby in equal shares to the plaintiff, the defendant and another of Les’ children,[1] Ila Joy Peter (“Ila”).
[1] Les had three children to Reta May (“Reta”), his first wife; they were the plaintiff, Ila, and Reta Fay (“Fay”). The defendant is the only child from Les and Ruby’s marriage.
The house property at Kadina (“the Kadina property”), which is the only property the subject to this dispute, had been owned in joint tenancy by Ruby and Les when they were both alive and had passed to Ruby by survivorship when Les died in 1998. Ruby made her 1998 Will shortly after Les’ death. When Ruby died, probate was granted on her 1998 Will. There is no dispute as to the validity of this grant of probate.
The claim
The plaintiff seeks to invoke the doctrine of “mutual wills” and contends that the wills made by Ruby and Les in 1993 (“the 1993 Wills”) were mutual wills. He claims that there was an agreement, between Les and Ruby, not to alter the arrangement for the distribution of the Kadina property provided for in the 1993 Wills, and that this can be inferred from an alleged conversation he had with Les in the garden of the Kadina property, supported by the content of the 1993 Wills and the fact of their execution. It is also submitted that such a binding agreement is further supported by certain statements made by Ruby to her solicitor when she was instructing him to draw her 1998 Will. Cumulatively, it is submitted, these sources provide clear evidence on which this Court can infer the alleged binding agreement.
Pursuant to his claim, the plaintiff seeks the Court’s declaration that the defendant holds the Kadina property on trust for the three alleged beneficiaries according to the trusts set out in the 1993 Wills. The plaintiff also has an alternative claim seeking a declaration that the defendant holds a one half interest in the Kadina property on trust for the three alleged beneficiaries as a result of a severance of the joint tenancy in equity.
For the reasons that follow I would dismiss the claims of the plaintiff.
Background facts
Les was born in 1903 and for most of his life was a farmer at Kadina on South Australia’s Yorke Peninsula. He married Reta May Taylor (“Reta”), when he was 25 and had three children by her: Ila, a daughter born in 1931; the plaintiff born in 1933; and another daughter, Fay born in 1936. Fay was disabled and was only three when Reta died in 1939. Not long after Reta’s death, Ruby, whose sister was married to a relative of Les, came to help Les as a housekeeper. Les married Ruby in 1944 and the defendant was born to Ruby and Les in 1946. On 24 July, 1968, Les and Ruby bought the Kadina property and became registered proprietors as joint tenants.[2]
[2] See Tender Documents (“TD”) 41 (Certificate of Title).
The 1993 Wills
On 8 September 1993, Les and Ruby attended a solicitor in Kadina, Mr Doug Reed (“Mr Reed”). They brought with them copies of what they told Mr Reed were wills drawn up by Bagot’s Trustee Company (“the Bagot’s Wills”). These copies were not signed but bore the year 1991. There was a compliments slip from “Farmer Trustee Group” which accompanied the Bagot’s Wills and there was a stamp to say they were copies. According to Mr Reed, the stamp does not show up on the Court copy.[3]
[3] Transcript (“T”) 18.12-18.
Les and Ruby gave instructions for the 1993 Wills to be drawn in substantially the same form as the Bagot’s Wills.[4] A modification was made to clause 3 of Ruby’s 1991 Will to delete reference to her “watches”[5] and the three alleged beneficiaries were substituted as the executors and trustees. In the case of Les, a similar substitution was made in respect of the executors and an amendment was made to clause 5 to increase the amount of a trust fund for his disabled daughter, Fay, to $15,000. The residuary clauses in the Bagot’s Wills were as follows.[6]
[4] T20.19-31; T47.7-47.11 ; TD 26 -27; Exhibit A4, 1-2.
[5] T 20 and TD 21.
[6] TD 24, 21.
Clause 6 of Les’ Bagot’s Will read:
I GIVE DEVISE AND BEQUEATH all the residue of my estate of whatsoever nature and wheresoever situate to my trustees upon trust to pay thereout all my just debts funeral and testamentary expenses and subject thereto I DIRECT my trustees to stand possessed of my residuary estate (with power to realize any part or parts thereof) for such of them my said wife RUBY OLIVE PRIDHAM and my said children REGINALD LESLIE PRIDHAM - GEOFFREY DEAN PRIDHAM - and ILA JOY PETER as shall survive me and if more than one in equal shares absolutely
Clause 4 of Ruby’s Bagot’s Will read:
I GIVE DEVISE AND BEQUEATH all the residue of my estate of whatsoever nature and wheresoever situate to my trustees upon trust to pay thereout all my just debts funeral and testamentary expenses and subject thereto I DIRECT my trustees to stand possessed of my residuary estate (with power to realize any part or parts thereof ) for such of them my said son GEOFFREY DEAN PRIDHAM and my said stepchildren REGINALD LESLIE PRIDHAM and ILA JOY PETER as shall survive me and if more than one in equal shares absolutely
As can be seen, hereafter these clauses were reflected in similar terms in the 1993 Wills.[7]
[7] T 24, T 47.3-47.7.
Clause 6 of Les’ 1993 Will read:[8]
I GIVE DEVISE AND BEQUEATH the rest and residue of my estate both real and personal of whatever nature and wherever situated unto my trustees UPON TRUST to pay thereout my just debts funeral and testamentary expenses and all charges payable in the administration of my estate and to hold the balance then remaining (herein referred to as “my residuary estate”) UPON TRUST for such of them my wife RUBY OLIVE PRIDHAM, and my children, REGINALD LESLIE PRIDHAM, GEOFFREY DEAN PRIDHAM and ILA JOY PETER, as shall survive me and if more than one equally between them.
[8] TD 15.
Clause 4 of Ruby’s 1993 Will read:[9]
I GIVE DEVISE AND BEQUEATH the rest and residue of my estate both real and personal of whatever nature and wherever situated unto my trustees UPON TRUST to pay thereout my just debts funeral and testamentary expenses and all charges payable in the administration of my estate and to hold the balance then remaining (herein referred to as “my residuary estate”) UPON TRUST for such of them as my son GEOFFREY DEAN PRIDHAM and my stepchildren REGINALD LESLIE PRIDHAM and ILA JOY PETER as shall survive me and if more than one equally between them.
[9] TD 9.
No express mention of the Kadina property was made either in these clauses or elsewhere in the 1991 or 1993 Wills. Thus the entire interest in the Kadina property was to pass by survivorship to the survivor of Les and Ruby, and then when the survivor had died, the residuary clause in the will of the survivor would come into operation so that the property would be shared equally amongst the three beneficiaries (or their children if they predeceased the survivor).
The only difference between the residuary clauses 6 (Les’ Will) and 4 (Ruby’s Will) of the 1993 Wills, is that Ruby is mentioned in Les’ clause, but Les is not mentioned in Ruby’s. This situation may possibly have arisen because Les had property other than the jointly owned Kadina property. Regardless of the reason for the difference, given the effect of survivorship, such difference has no effect on the distribution of the Kadina property.
The 1993 Wills were executed on 22 September 1993 and were still operative when Les died on 22 May 1998.
The 1998 Will
Probate was granted to the three alleged beneficiaries as executors of Les’ 1993 Will on 27 July 1998. On that same day, Ruby registered Les’ death with the Lands Titles Office and became the registered proprietor in fee simple of the Kadina property.[10]
[10] See TD 39-42.
Approximately one month after Les’ death, Ruby went to Mr Reed and gave instructions to him to draw a new will, thereby revoking her 1993 Will on 6 July 1998.
In the 1998 Will, Ruby appointed the plaintiff as sole executor with the other two alleged beneficiaries to be executors only if the defendant was unwilling or unable to act.[11] Another difference between the 1993 Will and the 1998 Will was that Ruby left legacies to both the plaintiff and Ila of $10,000 each. The residuary clause in the 1998 Will retained almost exactly the same wording as that in the 1993 Wills, namely:[12]
7.I GIVE the rest and residue of my estate both real and personal of whatever nature and wherever situated to my trustee UPON TRUST to pay thereout my just debts funeral and testamentary expenses and all charges payable in the administration of my estate and to hold the balance then remaining (herein referred to as “my residuary estate”) UPON TRUST for such of them as my son GEOFFREY DEAN PRIDHAM and my stepchildren REGINALD LESLIE PRIDHAM and ILA JOY PRIDHAM as survive me and if more than one equally between them.
[11] See TD 1-4.
[12] TD 3.
However its effect was very different because of the insertion of a new clause 6:[13]
6.I GIVE the residence and land situated at 7 Julia Terrace Kadina in the said State to my son GEOFFREY DEAN PRIDHAM.
[13] TD 2-3.
The new clause 6 excluded the Kadina property from the residuary of Ruby’s estate and instead expressly provided that the beneficiary would be the plaintiff alone.
After Ruby died, probate was granted on the 1998 Will to the defendant as executor on 25 February 2009. On 15 May 2009, the plaintiff lodged his statement of claim in these proceedings.
Legal principles
Mutual Wills
At the heart of the doctrine of mutual wills is the existence of a formal, legally binding agreement, often between husband and wife, not to revoke the effect of two wills which are made together and in essentially the same terms.[14] Where a court determines there are mutual wills, it can enforce the binding agreement inherent in the mutual wills, notwithstanding that one party to a mutual will may have created a substantially different will after the death of the other party.[15]
[14] Dufour v Pereira (1769) Dick 419; 21 ER 332; Birmingham v Renfrew (1937) 57 CLR 666, 686; Re Newey (Dec’d) [1994] 2 NZLR 590, 593; Barnes v Barnes (2003) 214 CLR 169, 199; Rosalind Croucher, ‘Mutual Wills: Contemporary Reflections on an Old Doctrine’ (2005) Melbourne University Law Review 12.
[15] Mutual wills can be revoked with proper notice from one party to the other. See Birmingham v Renfrew (1937) 57 CLR 666, 676.
The agreement not to revoke distinguishes mutual wills from those made with merely the same or very similar substantive provisions.[16] Where one party to mutual wills survives the other, as is alleged in the present case, the following propositions arise:
-A surviving party to mutual wills (“the survivor”) may deal, as absolute owner during his/her lifetime, with the property passing to him/her under the will of the first party deceased.[17]
-Where the survivor creates a new will, the existence of the mutual wills has no bearing on the granting of probate of the new will. [18]
-Equity recognizes a “floating obligation” over the property under mutual wills during the lifetime of the survivor. The “floating obligation” is not discharged by the creation of a new will. The obligation crystallises upon the death of the survivor in respect to the property that is left, so that, regardless of any new will, the property is held on trust to be distributed as to the provisions in the mutual wills.[19]
[16] Baird v Smee [2000] NSWCA 253 [6].
[17] Birmingham v Renfrew (1937) 57 CLR 666, 689.
[18] Birmingham v Renfrew (1937) 57 CLR 666, 683-684..
[19] (1937) 57 CLR 666, 676.
Latham CJ expressed these propositions in the following terms in Birmingham v Renfrew (“Birmingham”):[20]
Though a will is always revocable, and the last must always be the testator's will; yet a man may so bind his assets by agreement that his will shall be a trustee for performance of his agreement. ... These cases are common, and there is no difference between promising to make a will in such a form and making his will with a promise not to revoke it. This court does not set aside the will; but makes the devisee heir or executor trustee to perform the contract.
(Emphasis added.)
[20] (1937) 57 CLR 666, 676, citing Lord Campbell in Dufour v Pereira (1769) Dick 419; 21 ER 332.
In short, the doctrine of mutual wills provides a particular remedy for a party wishing to enforce an agreement and this is one of the remedies which the plaintiff seeks in the present case.
Proof of agreement not to revoke
The pre-condition to attaining this remedy, namely establishing the existence of the agreement not to revoke, is typically a difficult hurdle to overcome. As Latham CJ states in Birmingham:[21]
Those who undertake to establish such an agreement assume a heavy burden of proof. It is easy to allege such an agreement after the parties to it have both died, and any court should be very careful in accepting the evidence of interested parties upon such a question. Perhaps most husbands and wives make wills "by agreement," but they do not bind themselves not to revoke their wills. They do not intend to undertake or impose any kind of binding obligation. The mere fact that two persons make what may be called corresponding wills in the sense that the existence of each will is naturally explained by the existence of the other will is not sufficient to establish a binding agreement not to revoke wills so made. . . . There are obvious prima facie difficulties in giving effect to an agreement of this kind at the suit of those who may be called the disappointed beneficiaries. Their case depends upon a contract to which they were not parties and upon which, therefore, prima facie, they cannot sue. . . Further, it is conceded by those seeking to enforce the agreement that it does not have the effect of preventing the husband from dealing during his lifetime with property which he received from his wife, so that any trust which was created can only be a kind of floating trust which finally attaches to such property as he leaves upon his death. Prima facie, where property is given by will or otherwise to a person and he can do what he likes with it, a gift by the testator or donor of what that person shall happen to leave at his death does not limit or qualify the absolute gift to him which is the effect of such a disposition.
(Emphasis added and footnotes omitted.)
[21] (1937) 57 CLR 666, 674-5.
In the present case, the plaintiff’s action has a number of the difficulties referred to above. There are corresponding wills, but there is no express written agreement indicating the parties intended not to revoke; the parties to the alleged agreement are both dead; and it is a “disappointed beneficiary” who has brought the action. In such circumstances, there must be clear evidence from which to draw reasonable inferences to determine whether an agreement exists. The standard of proof remains the normal civil standard, but cautious scrutiny of the evidence is required in a case of this nature. As Mason P put it in the New South Wales Court of Appeal in Baird v Smee:[22]
The standard of proof is the balance of probabilities, but the Court is to take into account the nature of the claim or subject-matter of the proceeding. Cautious scrutiny is therefore required in cases, such as the present, where an implied agreement is invoked to defeat the effect of a solemn testamentary disposition by a person …who is unable to give evidence to explain her actions.
(Emphasis added and footnotes omitted.)
[22] Baird v Smee [2000] NSWCA 253, [8] with Handley and Giles JJA agreeing.
Evidence to be considered
Evidence which the courts have considered to determine whether such an agreement exists may include an implied agreement on the face of the wills themselves;[23] the family circumstances of the testators;[24] the non-revocation of the wills during the lives of the testators; [25] and oral statements made by the testators during their lifetimes.[26] However, such evidence must do more than merely establish that there was an informal consensus between the parties; it must establish that the parties formally contracted and were legally bound.[27] Mason P emphasised this final point in Baird v Smee:[28]
In order to succeed the appellants had to establish that [the testators] made a contract. One may readily infer from the form of the wills, the history of their making and their simultaneous execution that [the testators] had agreed on the plan of distribution evidenced in their wills. However mere consensus is not enough. There is a legal presumption of some strength that informal agreements between spouses are not intended to be legally binding.
(Emphasis added and footnotes omitted.)
[23] [2000] NSWCA 253, [6].
[24] [2000] NSWCA 253, [9].
[25] [2000] NSWCA 253, [9].
[26] [2000] NSWCA 253, [14].
[27] [2000] NSWCA 253, [24].
[28] [2000] NSWCA 253.
Similarly, in Hubbard v Mason,[29] Santow J said:[30]
Mere expectation or mutual desire as to the intended ultimate beneficiaries is not sufficient to give rise to an enforceable obligation; nor is it sufficient if only one party to the agreement intended it to be legally binding.
[29] (Unreported, Supreme Court of New South Wales (Equity), Santow J, 9 December 1997), BC9706574.
[30] Hubbard v Mason (Unreported, Supreme Court of New South Wales (Equity), Santow J, 9 December 1997); BC9706574, 30.
Justice Santow expressed the ultimate question for the Court in such circumstances as being whether it is: [31]
reasonable in the circumstances to conclude that the survivor intended as a matter of legal obligation, to give up his or her freedom of testation in the manner alleged, when that is evinced from oral conversation and external circumstances without the formality of writing.
[31] Hubbard v Mason (Unreported, Supreme Court of New South Wales (Equity), Santow J, 9 December 1997); BC9706574, 25.
Evidence as to the alleged agreement
The plaintiff relies on three main sources of evidence to establish the alleged agreement. The central plank is the plaintiff’s own evidence about a conversation with Les that occurred in the front garden of the Kadina property. Secondly, the plaintiff relies on the evidence of Mr Reed about the instructions he took from Ruby in 1998. Thirdly, the plaintiff relies on the content of the 1993 Wills themselves and the fact of their execution. The plaintiff also points to substratum features such as Les and Ruby’s relative ages and the nature of Ruby’s relationship with her stepchildren when they made their 1993 Wills. The plaintiff submits that inferences can be properly drawn from all these sources cumulatively to make out the binding agreement that the 1993 Wills were mutual wills.
The garden conversation
I am satisfied that a conversation took place between Les and the plaintiff in the front garden of the Kadina property. I have no hesitation in regarding the plaintiff as a truthful and credible witness. He made every endeavour to recall historic matters to the best of his ability. He showed considerable candour in the manner in which he gave his evidence; counsel for the defendant did not suggest otherwise. The plaintiff was endeavouring to recall something said many years ago and the information he gave was understandably sparse. This was partly caused by his father being a man of few words on private matters.[32]
[32] T 57.34 -37.
I will set out in some detail the evidence which the plaintiff gave as to the conversation with Les. As the evidence unfolded, a number of problems emerged. Not only was the evidence very limited, but the plaintiff vacillated and gave differing versions as to what Les said; it lacked clarity as to its connection with any wills of Les and Ruby; there was a vague suggestion that more than one conversation may have occurred; and there was no reliable evidence about the timing of the conversation. Most importantly, Ruby was not present at any conversation between Les and the plaintiff and there was no evidence that she agreed with what Les said.
The plaintiff commenced his evidence in a relatively confident manner:[33]
Q. In your family, thinking about these sorts of things that Les and Ruby would say to you from time to time or other children to your knowledge, was there much discussed in terms of wills and what might happen to their property when they died, one or more of them.
A. Not really but I can recollect dad saying one time that when they both go that everything was going to be left between the three of us, Ila, Geoffrey and myself.
[33] T 57.15-22.
He then gave evidence that there was at no time any family discussion about the wills of either Ruby or Les, or the intended property distribution:[34]
Q.Can you recollect whether the topic of their wills or their intentions was ever the subject of family meetings or discussion, to your knowledge, or did that not occur?
A.No, we had no discussions, meetings or anything about their wills or anything.
[34] T 58.7-58.12.
When asked when the conversation in the garden took place, he could not say, but he was confident that Ruby was not present:[35]
[35] T 58.16-59.11.
Q.Do you have any recollection now as to how that discussion came about?
A.No, not really. We were just talking about personal things and that’s what he said.
Q. Was it a topic that he raised or that you asked him about?
A.I think he just said about it. I didn’t ask him. I wasn’t that type to interfere with his personal life.
QHow old do you think your father would have been when this discussion took place?
A.He was living in Kadina so I don’t know what year it would have been but they were living in Kadina at this stage.
Q.When do you think the discussion took place, or you are unable now to identify the circumstances of the discussion?
A.When did it happen?
Q.Yes. Do you have any recollection of where or in what circumstances?
A.I think I was just visiting, out in the front garden, we were talking about things.
Q.This is at the house at Kadina?
A.Yes. Correct.
…
Q. Ruby, was she present?
ANo.
A little later in his evidence, and contrary to his earlier evidence, the plaintiff said that the topic of wills did come up for discussion with family members, as inferred by the use of the plural “we”. His evidence was that it was confined to encouraging Les to go to Mr Reed to have wills drawn up. The use of the plural suggested that this conversation occurred at a different time from the garden conversation which had been only between Les and the plaintiff:[36]
Q.Your father, did he ever say to you anything about intending to go on making a will or having gone and made a will or having seen solicitors or a trustee company?
A.I knew he had his will with the Bagots and then we got on to him and he went to Doug and Doug made the wills for him.
Q.Going back a step: you say you knew he had the wills with Bagots trustee company?
A.Yes.
Q.How did you know that?
A.He said he had it with them and then we said ‘Why don’t you go to Doug and just pay for it and they take nothing out of your estate’.
[36] T 59.12-24.
Soon after, counsel for the plaintiff attempted to establish the proximity between this discussion of the topic of wills, the content of wills and the garden conversation:[37]
[37] T 60.33-61.20.
Q. I was trying to find out whether you can pinpoint more accurately the date on which you discussed with your father what was in your parents’ wills by reference to whether this was before or after the time that you talked about going from Bagots and using Mr Reed instead?
A.No, not really.
Q.When your father had a discussion with you, did he mention anything about what had occurred between him and Ruby in terms of making wills?
A.No, not really.
Q.Did the words used by your father suggest to you in any way that both he and Ruby had in fact made a will of some description?
A.I understand they made wills but what was in it I had no idea.
Q.When you say ‘what was in it’, do you mean no idea beyond the description of what your father had given as to what would happen –
A.Only what dad had told me, that everything was going to be split up evenly.
Further efforts were made to connect the garden conversation with the content of wills and this resulted in another version of the conversation:[38]
Q.Mr Pridham, you can recollect having a discussion with your father at one stage on the topic of what would happen when Ruby and your father died?
A.Correct.
Q.And that discussion on that topic took place at the house at Kadina?
A.Correct.
Q.And what specifically can you recollect your father saying to you on that occasion?
A.Well, all I can recall we just had a short conversation about what was going to happen to his estate when he died and that’s when he said, that everything was going to be split up evenly, which was in their wills.
[38] T 63.18-63.30.
When asked to be more precise, the plaintiff gave the following evidence:[39]
Q.In the latter part of your answer you used the word ‘wills’, was that the word used in the conversation that your father had with you?
A.No, no.
Q.What words were used by your father?
A.Well, I really can’t recall because it’s that long ago and all I can understand is that everything is going to be split up three ways and Fay was going to be provided for.
[39] T 64.2-10.
The plaintiff in that evidence added a further reference to Fay being provided for, but moments later that reference was no longer included:[40]
Q.Did he mention anything about the means by which this state of affairs that there would be an equal division would take place?
A.No, all he said was that things were going to be split up evenly and then the conversation just finished.
[40] T 64.34-65.
Then further evidence was elicited about his awareness of wills being drawn up by Mr Reed. Again this evidence was confusing and uncertain:[41]
[41] T 65.35-67.5.
Q.Did you have any knowledge yourself at any point before he died whether or not he had been to see Mr Reed?
A.No.
Q.Is that something you didn’t find out until he did die?
A.No.
HER HONOUR
Q.I take it by ‘no’ you mean you never knew that he had gone to Mr Reed until after he died?
A.No, I knew he had his wills with Mr Reed, yes.
[COUNSEL FOR THE PLAINTIFF]
Q.How did you know that?
A.How did I know?
Q.Yes.
A.Well, it was just in a conversation.
Q.A conversation with your father?
A.Yes.
Q.And what did your father say to you in that conversation?
A.Well, all he said that he made his wills. We didn’t confer those private things very much at all.
Q.But there came a point, did there, where your father indicated that he had been to Mr Reed and he had made a will?
A.As far as I know he had said that he had made a will.
Q.And did he say that was just him or whether it was also his wife, Ruby, or the two of them?
A.The both of them.
Q.And did you have any understanding whether or not as a result of anything said to you, did you have an expectation or not you would be an executor of any will made by either of you or of your parents?
A.Yeah, I understood that the three of us were executors.
Q.And by ‘the three of us’ who do you mean?
A.Geoffrey and Ila and myself.
Q.And why do you have an understanding, had somebody told you that?
A.Well, I don’t know, really, just an understanding. Whether dad had told us.
Q.Somebody had told you obviously?
A.Well I can’t recall who told us.
Q.Did you have a belief that you would be the executor along with the other two of only your father’s will or of more than your father’s will, both his and Ruby’s or what?
A.I don’t know.
Counsel for the defendant objected at this point to the plaintiff giving evidence to his belief. The plaintiff’s counsel then took a different approach in an attempt to establish the connection between the garden conversation and the content of the wills:[42]
[42] T 68.20-37.
Q.Did your father identify to you the persons who were to take the estate of him and Ruby once they had both died?
A.No, not really.
Q.You said that he mentioned Fay specifically, you’ve made some specific reference to her; that’s correct?
A.What do you mean?
Q.I think your evidence earlier was that he made reference to Fay being provided for, is that right?
A.Yes
Q.Did he say anything about the position of his other children, you, Ila and Geoff, in terms of how you were to be provided for?
A.No, not really.
Q.Apart from the occasion which you’ve mentioned at the Kadina house, do you recollect any other discussion with either Ruby or Les prior to their deaths on the topic of their wills?
A. No.
Summary of the plaintiff’s evidence
In short, the central plank relied upon for the inference that there were mutual wills was demonstrably deficient. The overall fluidity of the plaintiff’s evidence is perhaps understandable, given the passage of time. But in any event there was a substantial lack of clarity as to what Les actually said. There was a further difficulty in that only one party to the alleged agreement was recounting this information.
Counsel for the plaintiff conceded that there were shortfalls in the plaintiff’s evidence but submitted that they could be overcome by “corroborating” evidence, namely the form and content of 1993 Wills and the later statement made to Mr Reed by Ruby in 1998.
I turn now to this evidence.
Mr Reed’s evidence
Mr Reed gave evidence about the 8 September 1993 meeting between himself, Les and Ruby in which he took instructions for drafting the 1993 Wills and about meetings in June and July 1998 between himself and Ruby in which he took instructions for drafting Ruby’s 1998 Will. He referred to, and relied on, his handwritten notes of those meetings and a typed transcription of those notes. Mr Reed gave evidence of the providence of the notes and the accuracy of the transcription[43] and these were admitted as exhibits.[44] He also refreshed his memory from his practice files.
[43] T 15-17.
[44] D 26 -34.
The plaintiff submitted that certain of Ruby’s statements as recorded in Mr Reed’s notes of the 1998 meetings lead to the conclusion that Ruby was seeking to justify of her decision to change from the position which she had agreed to when she had signed her 1993 Will.[45] This attempt to justify, it was submitted, invited the inference that Ruby was reneging on what she knew to be the binding agreement that she had entered into with Les.[46] The particular statements counsel pointed to as constituting her attempt to justify were, first, from the meeting of the 25 June 1998: [47]
I want to leave the house to Geoff” because I put in 1/2 the money when that house was bought . . . [the] House 7 Julia Terrace now my name, we (husband and I) paid half each to build it.
…
Mrs Pridham has been thinking about her will and feels she should give the extra provision to Geoff. She did pay for 1/2 the house”
[45] T 81.34 – 82.13.
[46] T 81.36-82.1.
[47] TD 28-9.
Secondly, from the 6 July meeting when Mr Reed was confirming the will with Ruby and paraphrasing her words: [48]
I then went through the will again – she confirmed it was as she wished, that she wanted the house to go to Geoffrey as he was her son and she wanted it to stay in Pridham name. He would be the one who would live in it - this was what she had always wanted but in the past Les made all the decisions and she went along with it.
[48] TD 33.
These comments, the plaintiff argued, were consistent with a state of affairs where Ruby had entered into the alleged agreement with Les, perhaps even reluctantly. On this argument, her comments to Mr Reed about Les’ dominance and her insistences that she had paid half for the Kadina property and that her son was her only natural child were simply expressions of her rationale for breaking that binding agreement.
I am not satisfied with the plaintiff’s interpretation. The statements were made in the context of Mr Reed’s questioning Ruby and expressing his concern about the changes which Ruby was requesting. On one interpretation, Ruby was simply responding to Mr Reed’s questions. She was not necessarily being defensive, nor was she necessarily seeking to justify her position. Rather, she was giving what appeared to be reasonable explanations for the variation in her will when Mr Reed was clearly concerned that this would be a significant change from that which had been set out in her 1993 Will. Mr Reed was quite correct in making sure that she understood what she was doing and to satisfy himself that she was not being unduly influenced by her own son.
Ruby’s statements to the effect that she always wanted to give the jointly owned property to her son upon her husband’s death and that she always went along with Les, strongly suggests that at the time when she was entering into the 1993 Wills, in the form in which they were, she was doing so reluctantly. She appears to be expressing that she would have preferred right from the start to indicate, in her own will, that she wanted her son to be able to receive the property, rather than dividing it amongst the three children. Because of their age differential, she was likely to die later than her much older husband. However, it does not necessarily follow that she entered into a binding agreement that she would not revoke her 1993 Will at some point after he died. Rather, I find the more probable explanation to be that she went along with Les’ proposal for distribution while he was alive, knowing that she could change her will in the likely event that she survived him. This is partly supported by the fact that she made this change only six weeks after his death. I do not consider that the conversations with Mr Reed inferentially “corroborated” that there had been an earlier binding agreement between Les and Ruby that she not revoke her 1993 Will.
Execution of the 1993 Wills
The plaintiff also submits that the 1993 Wills themselves provide corroborating evidence from which one can infer the alleged agreement. The plaintiff points particularly to the residuary clauses and submits that Les and Ruby’s recognition of the effect of the clauses, evidenced by their execution of the 1993 Wills, is consistent with the alleged agreement.
The difficulty with this submission is that the residuary clauses (set out at [12]-[13] above) do not actually mention the Kadina property. Moreover, Mr Reed could not say that he made specific mention of the way in which the residuary clauses would operate to incorporate the Kadina property once the survivor of Les and Ruby had died.[49] He simply adopted the residuary clauses from the Bagot’s Wills. I have no evidence that the Bagot’s Wills were even executed, let alone whether Ruby knew the effect of those residuary clauses. In these circumstances, it is not at all clear that, simply by executing the 1993 Wills, that Ruby understood and agreed that the Kadina property would be regarded as part of the residuary estate referred to in clause 4 of her 1993 Will. In the absence of clarification by Mr Reed, the mere existence of the residuary clauses does not persuade me of a binding agreement not to revoke the wills.
[49] T 21.19.
Further, Mr Reed could not give evidence that there was any specific instruction given to him to affirm in any way that the residuary clauses in the 1993 Wills were irrevocable. His evidence on this point in cross-examination was unequivocal:[50]
Q. Do you have any recollection of either Mr or Mrs Pridham ever saying anything to you about having an agreement about the way in which the wills should be?
A.No, I have no recollection of that at all.
Q.Can you say whether your practice in 1993 would have been such that if one or other of them had said something to you about an agreement how their wills were to be, you would have made a note of it?
A.If I understand what you mean by ‘an agreement’, I think it is likely that I would have noted it.
[50] 44.3-12.
I accept that the lack of writing is not an impediment in itself to inferring the alleged agreement.[51] Nevertheless, I would find it surprising that if Les and Ruby had agreed to enter into a binding agreement not to revoke the 1993 Wills at this time or later, they would not have at least told Mr Reed of this or instructed him to record the agreement accordingly. Taking the evidence of Mr Reed as a whole, I do not consider that his evidence enhances the plaintiff’s argument.
[51] Hubbard v Mason (Unreported, Supreme Court of New South Wales (Equity), Santow J, 9 December 1997); BC9706574, 25.
Background circumstances
I turn now to the background substratum circumstances which existed when Ruby and Les made the 1993 Wills. Counsel submitted that it was significant that “the evidence doesn’t show any distinction in treatment between her natural born and three stepchildren. The evidence is that she was a good mum and treated them in that way”.[52] Counsel for the plaintiff sought to draw from this an inference that it is likely that she would be prepared to adopt a binding agreement for distribution of property without discrimination between the children. The plaintiff’s evidence on Ruby’s treatment of her children was as follows:[53]
Q.How is Ruby known to you and your two sisters in your family?
A.How was she what?
Q.How was she known to you; what did you call her?
A.Well, in the early days I don’t know what we called her, but always called her mum. She was known as a mother for all those years, for 69 years.
Q.When Ruby was with you throughout all those years did she call herself mum?
A.Well, I don’t know really, we always called her mother, and I suppose – I don’t know what she used to call us.
[52] T 83.38-84.3.
[53] T 49.3-13.
Whilst I accept – and there is no genuine dispute – that Ruby considered each of the children equally as her own, and that she would not want to unfairly discriminate against them, this evidence does not rise to the height of counsel’s submission. This may provide an understanding for why the 1993 Wills distributed property in the way that they did, but it does not necessarily suggest a likelihood that she would enter into a binding agreement not to depart from the arrangement. The 1998 Will and Ruby’s comments to Mr Reed strongly support a different view.
The ages of Les and Ruby when they made the 1993 Wills are also said to be of significance. Counsel said that the fact that they were unlikely to marry again, reinforced by the fact that Ruby saw all of the children as her own, constituted “the sort of situation” where the alleged agreement is likely.[54] Again, this does not persuade me that the alleged binding agreement existed.
[54] T 83.24-30.
Conclusions
Taking into account the matters I have set out above as a whole, I am not satisfied that there was a binding agreement between Les and Ruby not to revoke the 1993 Wills. Having had regard to the garden conversation and the “corroborating” evidence with the degree of scrutiny and caution required in cases such as the present one, I find the evidence is neither clear enough, nor sufficient to infer the alleged agreement. The lack of clarity and the factual shortfalls in the plaintiff’s evidence of the garden conversation have been discussed. These have created impediments to drawing the underlying inferences which the plaintiff seeks to use to support the alleged agreement. However, even if these shortfalls are ignored, the evidence is unsatisfactory. Taken at its highest, and ignoring its inconsistencies and its tenuous nature, the evidence of the plaintiff was that the family encouraged Les and Ruby to have their Bagot’s Wills replaced by wills drawn up by Mr Reed and that Les told the plaintiff that the effect of those wills was that the Kadina property would be split evenly between the plaintiff, the defendant and Ila and that Fay would be provided for separately. There is nothing in the garden conversation by itself which added the further necessary additional dimension, namely that neither of them would revoke their wills. At best it could be regarded as acknowledgment that the situation Les described was the current position of the wills as they stood at that time. This indeed would have been accurate as at 1993 and, indeed, accurate up until the time when Ruby changed her will in 1998.
There is nothing in the evidence of Mr Reed, the 1993 Wills themselves or the surrounding circumstances which raises this assessment any higher. This does not even amount to a “mere consensus” between Les and Ruby not to revoke their 1993 Wills, let alone a legally binding agreement. Going back to the question posed by Santow J in Hubbard v Mason,[55] I find it is not reasonable in the circumstances to conclude that Ruby would have intended as a matter of legal obligation to give up her freedom of testation.
[55] Hubbard v Mason (Unreported, Supreme Court of New South Wales (Equity), Santow J, 9 December 1997); BC9706574, 25.
Alternative argument
Counsel for the plaintiff put an alternative argument, namely that by Ruby and Les making the 1993 Wills, there was, in equity, a severance of the joint tenancy of the property. The severance is said to arise by conduct. That is to say that because Ruby acquiesced and assented to the arrangement that the Kadina property would, on the death of both Les and herself, be left in equal shares to the three children, the parties thereby treated the Kadina property as if it were held as tenants in common and therefore equity would enforce that arrangement. The argument continued that although Ruby acquired the whole of the legal interest in the Kadina property through survivorship, this did not alter that in equity the interests in the property were in the nature of tenants in common. It was therefore submitted that upon acquiring Les’ one half interest in the Kadina property, Ruby was obliged to divide the Kadina property between the three children equally, or that it should be divided between the three ‘at least in relation to the one half equitable interest’ originally held by Reg.
In the written submissions of the plaintiff, there were a number of different assertions regarding the grounds upon which equity would provide a remedy to the plaintiff. All of these claims were said to be contingent on a finding that there was a severance in equity. In closing,[56] counsel articulated the claim more precisely. It was submitted that if there was a severance in equity then Ruby took Les’ half interest in the Kadina property, knowing that Les intended that Ruby dispose of the property according to Les’ 1993 Wills. Further she did so in circumstances where she acquiesced in Les’ belief that the property would be so dealt with. If this is so, counsel argued, then Ruby would hold Les’ half interest on trust to be distributed according to Les’ 1993 Will.
[56] T 82, 102-3.
The plaintiff relied on the evidence set out above to support this argument. In particular, counsel referred to the evidence of Mr Reed as to his meeting with Ruby in which she gave an admission against interest that “in the past Les made all decisions and she went along with it”.[57]
[57] Exhibit A4 (Notes of Mr Reed) 6; T 40-1 (Mr Reed – Examination in Chief).
The plaintiff relied on a number of cases and also an authority of Professor Peter Butt in Land Law.[58] In the latter text, the author states:[59]
A joint tenancy is also severed in equity by a course of conduct by all joint tenants indicating a commonly-held belief or assumption that their interests are held in undivided shares and without right of survivorship.
(Footnote omitted.)
And further states:[60]
Whether a sufficient course of conduct exists is a matter of evidence. The onus of proof rests on the person asserting that severance has occurred. It is not necessary to show a specific act dividing the property, as long as there has been ‘a general dealing, sufficient to manifest the intention to divide the whole’.
(Footnote omitted.)
The author further notes that severance may also occur where all joint tenants make ‘mutual’ wills.[61] It can therefore be seen using the authority of Professor Butt, that mutual wills is one example of a severance in equity by conduct.
[58] Peter Butt, Land Law (2006, 5th ed) [1482]-[1486].
[59] Peter Butt, Land Law (2006, 5th ed) [1482].
[60] Peter Butt, Land Law (2006, 5th ed) [1484].
[61] Peter Butt, Land Law (2006, 5th ed) [1486].
However it is clear just looking at the authority of Professor Butt alone, that what is required is a course of conduct which indicates that there was a commonly held assumption, evidenced by conduct, that the parties have treated property as tenants in common, notwithstanding that the property was in fact held as joint tenants. This is made very clear in the cases which were sited by the plaintiff in support of its proposition. Commencing with In re Wilford’s Estate; Taylor v Taylor (“Re Wilfred’s Estate”);[62] this was a case in which two sisters held a property as joint tenants. They agreed to make mutual wills such that the survivor would take the property for life only and they acted accordingly. Their conduct was consistent with the expression in the mutual wills. Thus it was concluded that although the property was held at law in joint tenancy, by their conduct they had agreed to treat the property as tenancy in common and there was therefore a severance in equity.[63]
[62] In re Wilford’s Estate;Taylor v Taylor (1879) 11 Ch D 267.
[63] In re Wilford’s Estate;Taylor v Taylor (1879) 11 Ch D 267, 269.
That situation does not bear any relationship to this case. The only conduct which can be relied upon is that which formed part of the argument for mutual Wills. There was never any other conduct between the parties which suggested that they treated the property other than as a joint tenancy. There was for example no carving up of the house or any indication that between themselves they regarded the property as going any other way other than by survivorship.
The next case relied upon was In the Estate of Heys.[64] In that case a husband and wife were joint tenants of a number of lease hold properties by their Wills each of them left their property to each other with gifts over to relatives which was in effect treating their jointly owned tenancy as a tenancy in common. In that case the Court decided that there had been a severance of the joint tenancy as a result of their Wills.[65]
[64] In the Estate of Heys [1914] P 192.
[65] In the Estate of Heys [1914] P 192, 195-196.
However again that is not the fact situation in this case. The Wills do not treat the joint tenancy as being anything else other than joint tenancy. Therefore that case is unhelpful. A similar example is Szabo v Boros.[66] This case concerned two persons who owned property as joint tenants. The two agreed to make mutual wills whereby each left their several interests in property to the other for life, with a remainder to different named beneficiaries. Following the example of Re Wilfred’s Estate, the Full Court decided that as a result of their mutual Wills there was a severance of the joint tenancy and a conversion to tenancy in common. Thus the express Will was the basis for the conduct leading to the severance of equity.
[66] Szabo v Boros (1967) 64 DLR (2d) 48.
Again this situation is different from the facts in this case.
In general, it is worthwhile to note that in these cases referred to by the plaintiff, conduct indicating severance was proved by evidence that the conduct of the parties was inconsistent with treating the property as joint tenancy, not merely that it was also consistent with a tenancy in common. As the Queensland Court of Appeal has said in Sprott v Harper:[67]
A severance may occur … independently of any intention to achieve such a specific result. The question is whether one or both of the parties have acted in such a manner as to require an inference of severance to be drawn. Owners may sever a joint tenancy without knowing what a "joint tenancy" or "severance" is. The real question is whether the parties have acted in a way that the law regards as inconsistent with the maintenance of the joint tenancy.
[67] [2000] QCA 391, [8].
As I have discussed above, there is no evidence in this case that Les and Ruby engaged in conduct that was inconsistent with treatment of the Kadina property as joint tenants.
The final case relied upon was Goyal v Chandra.[68] The short facts were that a husband initially purchased a property in his own name where he lived with his first wife. Subsequently he met his current wife. They were both doctors. They decided to undertake renovations to the property with each contributing funds and borrowing monies guaranteed by each other as to repayment. The husband transferred the property into joint tenancy to his wife on an understanding that the result would be that the joint tenancy would come to an end only on the death of either of them and in that event the other would succeed to the property by survivorship. The wife became terminally ill, she could not repay the monies. The husband alleged that she told him that the house would be his after her death but she could not make repayments. The husband made repayments. The wife, virtually on her death bed, took out an application to transfer her interest in the property to herself such that instead of being a joint tenant she would be a tenant in common with her husband. He took out an application to restrain the registration of that application. The judge decided on the balance of convenience to decline the injunction particularly bearing in mind the dying wife’s situation and that in any event an adjustment could later be made if necessary after the death of the wife. Brereton J decided that it would be unconscionable for a person to act contrary to such an expectation or assumption and that equity may preclude a person from severing a joint tenancy either by way of equitable estoppel or by imposing a constructive trust. As Brereton J said:[69]
I would also hold that where there is not a complete agreement, nonetheless on the principles of equitable estoppel, where one joint tenant has an expectation that he or she will acquire by survivorship the interest of the other and acts on that expectation to his or her detriment, and the other is implicated in the creation of the expectation and encourages the reliant activity of the first, then, at least ordinarily, it will be unconscionable for the second to act contrary to the expectation or assumption, and equity may preclude the second from severing the joint tenancy, either by equitable estoppel or by imposing a constructive trust, the underlying elements of which in this field are substantially the same. The result is such that I would hold that there is a legal basis for the claim which the plaintiff advances.
[68] Goyal v Chandra (2006) 68 NSWLR 313.
[69] Goyal v Chandra (2006) 68 NSWLR 313, 320[29].
It was submitted by the plaintiff that the silence of Ruby at the time of the 1993 Wills, in combination with her statement to Mr Reed at the time when she sought to change her Will in 1998, should lead to a similar conclusion. In my view the fact situation is decidedly different. Ruby did not endeavour to alter the basis upon which she and Les held the property and between the two of them it went to her by way of survivorship. She did not endeavour to alter during his lifetime the arrangement as to joint tenancy. It returns again to the same grounds upon which I rejected there being mutual Wills. There was no evidence of any agreement, or even a representation by Ruby, that she would not change her Will after Les’ death. There was no silence adverse to his interest. She did not, for example, remain silent while Les claimed that neither of them would revoke their Wills. Accordingly, the principles of equitable estoppel and constructive trust do not arise.
Given that I have not found there to have been a severance at equity, it is not necessary to consider the further arguments of the plaintiff that are contingent on such a finding.
For these reasons I therefore reject the alternative argument linked as it inevitably must be in these circumstances to the lost argument of mutual Wills. I therefore refuse the application.
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