Re Burstyner
[2021] VSC 531
•26 August 2021
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
TRUSTS, EQUITY AND PROBATE LIST
S PRB 2021 05586
IN THE MATTER of the estate of HENRY SAMUEL BURSTYNER, deceased
APPLICATION BY:
| DAVID SANDOR BURSTYNER (in the will called David Burstyner) and Plaintiffs |
---
JUDGE: | McMillan J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | On the papers |
DATE OF JUDGMENT: | 26 August 2021 |
CASE MAY BE CITED AS: | Re Burstyner; Application by Burstyner & Anor |
MEDIUM NEUTRAL CITATION: | [2021] VSC 531 (First Revision 10 December 2021; Second Revision 16 February 2022) |
---
PROBATE — Where executors seek letters of administration with the will annexed — Where purpose of application is to break chain of representation — Where executors do not wish to renounce probate — Where executors required to renounce probate to obtain letters of administration with the will annexed — Effect of renunciation on a person’s entitlement to apply for grant in another capacity — Administration and Probate Act 1958 (Vic) s 16 — Re William Kennett Loftus (1864) 3 Sw & Tr 307; 164 ER 1293; Re Gill (1872–5) LR 3 P&D 113; Re Sahl (1897) 7 BC NSW 71; Re Saxon (1872) 6 SALR 52.
---
APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr R Boaden | Rockman & Rockman Lawyers Pty Ltd |
HER HONOUR:
Introduction
Henry Samuel Burstyner died on 8 January 2021, leaving a will dated 18 February 2000. The deceased was survived by his three adult sons: David Sandor Burstyner (‘David’), Joel Burstyner (‘Joel’) and Shane Burstyner (‘Shane’). The deceased’s will appoints David, Joel and Shane as executors of the estate and leaves his estate to them in equal shares.
Prior to his death the deceased was a practising solicitor. At the date of his death, the deceased was the sole executor of one estate and appeared to be administering that estate. The deceased was also the executor in another estate that was unlikely to need administration. As the deceased’s health declined in the latter part of 2020, the deceased took some steps to engage another law firm to take over files relating to his estate matters.
Application
David and Joel (‘the plaintiffs’) filed an originating motion seeking a grant of letters of administration with the will annexed. By agreement, Shane did not join in the application.
The plaintiffs sought a grant of letters of administration with the will annexed, rather than a grant of probate, in order to break the chain of representation as contained in s 17 of the Administration and Probate Act 1958 (Vic). The plaintiffs did not want to be executors by representation of any estates to which the deceased was an executor having regard to the responsibilities and potential liabilities that may be incurred in taking on such roles.
The plaintiffs made funeral arrangements and obtained information from the deceased’s accountant as to the deceased’s assets and liabilities. Otherwise they have not taken any steps to administer the deceased’s estate. The urgency of the application arose due to the deceased holding funds in trust at the date of his death and the plaintiffs being under pressure from the Legal Practitioners Liability Committee and the Law Institute of Victoria to administer the estate.
The Registrar of Probates rejected the plaintiffs’ application on a number of grounds, however, the principle issue that arose was whether the plaintiffs could obtain a grant of letters of administration with the will annexed without giving up their rights as executors. The Registrar’s position was that before letters of administration with the will annexed could be granted to the plaintiffs, all executors named in the will must be ‘cleared off’.[1] As the plaintiffs did not wish to renounce probate, their rights as executors would not be cleared off.
[1]This phrase is taken from r 8(4) of The Non-Contentious Probate Rules 1987 (Supreme Court of England and Wales) which provide, inter alia, that ‘[o]n an application for a grant of administration the applicant must state in the application in what manner all persons having a prior right to a grant have been cleared off’.
Applicable principles
In Victoria renunciation operates as a disclaimer of any trust that he or she may take under a will.[2] Renunciation of probate by the executors would clear off their rights as executors and their executorship would ‘wholly cease’.[3] Other methods of clearing off include being incapable of acting, being deceased or being passed over. Consents of the executors or statements by them that they do not wish to act as executors are not sufficient to clear off the rights of the executors.[4]
[2]Trustee Act 1958 (Vic) s 46(1). See also Trustee Act 1925 (NSW) s 10(1); Trustee Act 1973 (Qld) s 18; Trustee Act 1962 (WA) s 12(1); Administration and Probate Act 1929 (ACT) s 20A(1); Administration and Probate Act 1969 (NT) s 29, cited in G E Dal Pont, Law of Succession (LexisNexis Butterworths, 3rd ed, 2013) 331 [10.59].
[3]Administration and Probate Act 1958 (Vic) s 16(1). The practice of the Court issuing a citation no longer exists in the Supreme Court Act 1986 (Vic) having fallen into disuse in Victoria: see Re Giggins [1969] VR 208, 212 (Gowans J).
[4]Garrard v Garrard (1871) LR 2 P & D 238 (Lord Penzance)(‘Garrard’). In Garrard the Court held it could not grant administration with the will annexed to the residuary legatee, with the consent of the executor. It could only do so on the executor’s renunciation of probate or after a citation had been served upon him, upon his non-appearance within the prescribed time.
It is only after the executors are cleared off that a grant of letters of administration with the will annexed can be issued.[5]
[5]Ibid.
In certain circumstances a named executor may have an entitlement to apply for letters of administration in another capacity, such as where the person is a beneficiary under the will. Similarly, a person who is entitled to letters of administration in one capacity may also have an entitlement to apply in another and lower capacity, such as in the capacity of the deceased’s spouse, a relative or a creditor.
Legislation
In Victoria the legislation is silent as to the effect of renunciation on a person’s entitlement to apply for a grant in another capacity.
Interstate legislation
The relevant legislation in the states and territories is not uniform. In Queensland, like in Victoria, the legislation is silent to the effect of a person’s entitlement to apply for a grant in another capacity.
In the Australian Capital Territory and the Northern Territory, a person who has renounced either probate or administration must not be granted representation of the estate in another capacity.[6]
[6]Court Procedures Rules 2006 (ACT) r 3014; Supreme Court Rules 1987 (NT) r 88.13.
In New South Wales, prior to 21 January 2013 an executor who had renounced was debarred from taking a grant in another capacity,[7] however, the current pt 78 does not contain such a restriction.[8]
[7]Supreme Court Rules 1970 (NSW) pt 78 r 14(1).
[8]Supreme Court Rules(Amendment No 420) 2012.
In Tasmania, a person who has renounced is no longer entitled to apply for any other grant in respect of the deceased, regardless of whether they were an executor or entitled to apply for letters of administration, however the Court may give leave to withdraw the renunciation if satisfied there are exceptional circumstances.[9]
[9]The Probate Rules 2017 (Tas) rr 17(1), 22(1), (4).
In Western Australia, the Registrar has a discretion to allow a person who has renounced probate of the will or administration of the estate of a deceased person to take a grant in another capacity. Rule 28 of the Non-Contentious Probate Rules 1967 (WA) provides:
Unless the Registrar otherwise directs, a person who has renounced probate of the will or administration of the estate of a deceased person in one capacity may not take a representation to the same deceased in another capacity.
In South Australia, different rules apply depending on whether the person who renounced probate was an executor or a person entitled to letters of administration. In relation to executors, the rules provide that renunciation by an executor does not operate as a renunciation of any right that the executor may have to a grant of administration in another capacity unless the executor expressly renounces that right.[10] However, unless the Registrar in South Australia directs otherwise, a person who has renounced administration in one capacity may not obtain a grant of administration in another capacity.[11]
Legislation in England and Wales
[10]The Probate Rules 2015 (SA) r 49(3).
[11]Ibid r 49(4).
The South Australian rules are the same as those contained in The Non-Contentious Probate Rules 1987 (Supreme Court of England and Wales) (‘the current English Rules’) and do not limit the right of an executor to obtain a grant in another capacity.Rule 37 of the current English rules refers to ‘Renunciation of probate and administration’ and the relevant rules provide:
37(1)Renunciation of probate by an executor shall not operate as renunciation of any right which he may have to a grant of administration in some other capacity unless he expressly renounces such right.
37(2)Unless a district judge or registrar otherwise directs, no person who has renounced administration in one capacity may obtain a grant thereof in some other capacity.
Rule 8(4) of the current English rules provides that an applicant seeking a grant of administration must state in what manner all persons having a prior right to a grant have been cleared off.
Case law
Case law that address the issue establish that an executor’s renunciation will not preclude an application for a grant in another capacity unless the executor has expressly renounced that right.
In the Queensland case of Re Boden,[12] the deceased appointed her son and a stranger as her executors and both of them renounced probate. The named son, together with another son of the deceased, both of whom were beneficiaries, applied for a grant of administration with the will annexed and the other beneficiaries consented to the application. Orders were made for a grant of administration with the will annexed to the applicants with the Court holding that the Queensland Probate Act 1867 (Qld) applied the English probate practice as set out in r 50 of the English Rules and Orders 1862. Rule 50 dealt with non-contentious applications and provided:
No person who renounces probate of a will or letters of administration of the personal estate and effects of a deceased person in one character is to be allowed to take a representation to the same deceased in another character.
[12][1933] QWN 34. The English Rules in place at the time were the Rules and Orders of 1862 dealing with non-contentious or common form business under the Court Probate Act 1857 (Eng).
The reasoning in Re Boden is based on the earlier English decision of Re William Kennett Loftus[13] where Sir JP Wilde held that, although r 50 provided general guidance for the business in the Registry, it was capable of modification where sufficient reason was shown for departing from it.[14]
[13](1864) 3 Sw & Tr 307; 164 ER 1293.
[14]Ibid 1294–5 (Sir JP Wilde).
In the subsequent case of Re Russell[15] Sir Wilde described the meaning of r 50 as follows:
where a man under a will occupies in reference to the testator two different characters, he shall not select either one he pleases as the basis of his grant, but must take administration on the largest ground. He cannot throw aside probate and take a more limited grant.[16]
[15](1865–9) LR 1 P & D 634.
[16]Ibid 635 (Sir JP Wilde).
However, Sir Wilde held there was no conflict with r 50 where a named executor had renounced probate in Australia, but was willing to act as attorney for the executors in England as he was deemed to have given up his own claim and rights and the new claim was essentially on behalf of a third party.
In the English case of Re Gill,[17] Sir J Hannen determined that in a situation where the executor renounced, he had only given up his rights as executor and could still propound the will in another character, either as legatee or guardian of the minor residuary legatees.[18] Professor G E Dal Pont in Law of Succession observes that arguably this represents the general law in any case, that is, an executor’s renunciation will not preclude an application for a grant in another capacity unless the executor has expressly renounced that right.[19]
[17](1872–5) LR 3 P&D 113.
[18]Ibid 115 (Sir J Hannen).
[19]Dal Pont (n 2).
In the English case of Re Toscani,[20] the person who had been named as sole executor and who had renounced, was permitted to take letters of administration de bonis non, with the will annexed in his capacity of creditor. The Court noted that enforcing r 50 was in the discretion of the Court.[21]
[20][1912] P 1.
[21]Ibid.
In the New South Wales decision of Re Sahl,[22] Simpson J made an order for joint administration with the will annexed to two persons, where one person was appointed executor under the will but was unwilling to act alone and he renounced probate of the will. His Honour considered that it was in the best interests of the estate to make the order even though it ‘would be somewhat disregarding the rule … but it appears that the English Courts have in several occasions disregarded the rule’.[23]
[22](1897) 7 BC NSW 71.
[23]Ibid 72 (Simpson J).
In the South Australian case of Re Saxon,[24] the Court comprising Hanson CJ and Gwynne and Wearing JJ held that while r 49 of the Testamentary Causes Act 1867 (SA) forbids persons who have renounced probate of a will from becoming administrators, the Court is not bound by that rule which was only meant for the guidance of the Registrar, relying on the decision of Re Loftus.[25]
[24](1872) 6 SALR 52.
[25]Ibid 52 (Hanson CJ and Gwynne, Wearing JJ).
These cases demonstrate that an executor’s renunciation need not preclude an application for a grant in another capacity, however, the discretion whether or not to make a grant in another capacity is left to the Court or the Registrar.
Resolution of the proceeding
While the plaintiffs did not wish to renounce probate, the Court’s view was that all three executors should renounce their rights to probate, but not to their rights to administration with the will annexed. With the executors also being the beneficiaries under the will, this was appropriate to put them in a position to apply in that capacity for administration with the will annexed.
Subsequently, the plaintiffs filed renunciations of probate expressly reserving their rights to obtain a grant of letters of administration with the will annexed and also filed Shane’s renunciation of probate reserving his right to obtain a grant of letters of administration with the will annexed. With the filing of the renunciations, the rights of the plaintiffs as executors were closed off and the Registrar of Probates made a grant of letters of administration with the will annexed in their capacities as beneficiaries of the estate of the deceased.
---
2
0
0