Re Dodson; Dodson v Dodson
[2019] VSC 833
•17 December 2019
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
TESTATORS FAMILY MAINTENANCE LIST
S ECI 2018 00299
IN THE MATTER of an Application pursuant to Part IV of the Administration and Probate Act 1958 (Vic)
and
IN THE MATTER of the Will and Estate of GORDON JAMES DODSON, deceased
| STEVEN JOHN DODSON | Plaintiff |
| v | |
| GARY JAMES DODSON and ELIZABETH ANNE MACRAE (in their capacity as the Executors of the will of the abovenamed deceased) | Defendants |
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JUDGE: | McMillan J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 13, 14 November 2019 |
DATE OF JUDGMENT: | 17 December 2019 |
CASE MAY BE CITED AS: | Re Dodson; Dodson v Dodson |
MEDIUM NEUTRAL CITATION: | [2019] VSC 833 |
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FAMILY PROVISION – Where deceased made provision for adult son by provision of a right of residence in residential home, right of use of farm land and share in residuary estate – Where defendants agree that provision for adult son does not satisfy moral duty – Where quantum in dispute – Adequate provision for proper maintenance and support – Where son estranged from deceased – Whether deceased provided for son during deceased’s life – Where principal asset of the estate is a family farm – Where plaintiff incapable of managing own affairs – Administration and Probate Act 1958 (Vic), ss 91, 91A.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr A Cassidy | Coulter Roache Lawyers |
| For the Defendant | Ms U Stanisich | Whyte, Just & Moore |
HER HONOUR:
Gordon James Dodson died on 3 September 2017, aged 87 years (‘the deceased’). The deceased’s wife died in 1987.
The deceased was survived by his partner of 30 years, Joyce Johnson, and his three children, Elizabeth Anne MacRae (‘Anne’), Gary James Dodson (‘Gary’), and Steven John Dodson (‘Steven’).
Probate of the deceased’s will dated 19 December 2013 (‘the will’) was granted to Gary and Anne on 25 January 2018.
Pursuant to Part IV of the Administration and Probate Act 1958 (‘the Act’), Steven seeks further provision from the estate of the deceased.
The deceased’s estate
The total value of the deceased’s estate is agreed between the parties, as reflected in the affidavit of financial position affirmed by Anne on 11 November 2019. Updated valuations for the real property assets of the estate, performed by Opteon Solutions, were exhibited to the affidavit of Aaron Martin Jolly, solicitor, sworn 14 November 2019.
Following the updated valuations, the approximate value of the assets of the deceased’s estate is as follows:
Asset
Value ($)
Farmland at 100 Banks Road, Mannerim (‘100 Banks Road’) 4,500,000 Farmland at 131 Banks Road, Mannerim (‘131 Banks Road’)
1,415,000
Residential property at 52 De Burgh Road, Drysdale (‘De Burgh Road’)
460,000
Toyota Avalon motor vehicle
4,000
50% share in the G & G Dodson Partnership
145,116
Share portfolio (including dividends)
1,326,620
Other realised assets (capital and interest)
855,151
TOTAL 8,705,887
Save for administration expenses of approximately $63,962 and provision for unpaid income tax of $20,000, the estate has no outstanding liabilities. The net estate is, therefore, approximately $8,621,925.
The will
By his will the deceased provided as follows:
(a) the deceased’s Toyota Avalon motor vehicle was given to Joyce Johnson.
(b) the deceased’s share in the farming partnership, established between himself and Gary, was bequeathed to Gary absolutely.
(c) the farm property at 131 Banks Road, and livestock thereon, was devised to the executors upon trust for sale, with the power to postpone sale and permit Steven to have the use and enjoyment of the property and livestock for so long as the executors in their absolute discretion see fit. The net proceeds of any sale of 131 Banks Road were to be held on trust for Gary as part of the ‘Gary Dodson Will Trust’.
(d) the farm property at 100 Banks Road and the residue of livestock, crops, farm implements, machinery, and the contents of the dwelling and outbuildings thereon to the Gary Dodson Will Trust.
(e) the property at De Burgh Road, together with its contents, to the executors upon trust for sale, with the power to postpone sale to allow Steven to personally occupy the premises as his principal place of residence. The will stipulated that Steven was to personally pay all rates, taxes and outgoing expenses, as well as maintenance and insurance costs. Upon Steven failing to occupy the property personally, pay outgoing expenses, keep the property in good order or keep the property insured, the property was to be sold. The net proceeds of sale of De Burgh Road were to pass to the deceased’s grandchildren (Anne and Steven’s children) in equal shares upon their attaining the age of twenty-one.
(f) the deceased’s share portfolio be held upon trust for sale, with the sale proceeds to be distributed as follows:
(i) one sixth to the Anne MacRae Will Trust;
(ii) one sixth to the Steven Dodson Will Trust;
(iii) one third to Joyce Johnson;
(iv) one sixth to Jayne Tomkins (Joyce’s daughter); and
(v) one sixth to Joyce’s grandchildren.
(g) the balance of the residuary estate be divided into three equal shares, to be distributed as follows:
(i) one third to be held upon trust for the benefit of Steven and his children, to pay the income as the executors in their discretion think fit and, upon Steven’s death, to such grandchildren as are then living in equal shares. The executors retained a further discretion, notwithstanding the trust, to pay or apply sums out of the capital of the trust for the benefit of Steven during his lifetime;
(ii) one third to the Anne MacRae Will Trust; and
(iii) one third to the Gary Dodson Will Trust.
The parties’ positions
Steven seeks provision absolutely as follows:
(a) the house and land at De Burgh Road;
(b) the land at 131 Banks Road;
(c) the part of the land at 100 Banks Road as is contained in Certificate of Title Volume 8042 Folio 487;
(d) one sixth of the deceased’s share portfolio; and
(e) one third of the residuary estate.
Gary and Anne submitted that proper provision for Steven would be discharged by the following:
(a) conversion of his interest in De Burgh Road to an absolute or extended life interest, with a preference for an extended life interest so as to preserve the gift over to the deceased’s grandchildren;
(b) receipt of his one sixth of the deceased’s shares absolutely, rather than in trust;
(c) receipt of his one third of the residue absolutely, rather than in trust; and
(d) receipt of Gary’s one third share of the residue, free from any trust and in lieu of the provision in the will in relation to 131 Banks Road.
The defendants submitted that their proposal for provision for Steven would provide him with accommodation and a nest egg of approximately $800,000.
Applicable principles and legislation
Section 91(2) of the Act provides that the Court must not make a family provision order unless it is satisfied that:
(a) the claimant is an ‘eligible person’ as defined in the Act;
(b) in the case of certain categories of eligible person, that the claimant was wholly or partly dependent upon the deceased;
(c) the deceased had, at the time of death, a moral duty to provide for the claimant; and
(d) the current will fails to make adequate provision for the proper support and maintenance of the claimant.
Once it is satisfied of those pre-requisites, the Court is entitled to order further provision from the deceased’s estate in the exercise of its discretion.
The defendants accept that as the deceased’s child, Steven is an eligible person as defined in s 90 of the Act. They also accept that the deceased owed a moral duty to Steven which has not been fulfilled by the deceased’s will. The only issue in dispute is the amount of any further provision to Steven.
In determining the appropriate amount of provision for an applicant, the Court must consider the position of the applicant at the time of trial.[1] In doing so, the Court must take into account the degree to which the deceased had a moral duty to provide for Steven, the degree to which the distribution of the deceased’s estate fails to make adequate provision for him, and the degree to which Steven is not capable, by reasonable means, of providing adequately for his own proper maintenance and support.[2]
[1]See, eg, Blore v Lang (1960) 104 CLR 124, 130 (Dixon CJ); Prosser v Twiss [1970] VR 225, 232 (Lush J); Slack v Rogan (2013) 85 NSWLR 253, 284-285 [127] (White J).
[2]Administration and Probate Act 1958 (Vic) s 91(4)(a)–(c).
The Court must also have regard to the terms of the deceased’s will, evidence of the deceased’s reasons for the dispositions made in the will and any other evidence of the deceased’s intentions in relation to Steven.[3]
[3]Ibid, s 91A(1).
Section 91A(2) of the Act provides the following non-exhaustive list of matters to which the Court may have regard in the exercise of its discretion to order further provision:
(a) the nature of the relationship between the deceased and the claimant;
(b) any obligations of the deceased to the claimant, any other eligible person or beneficiary to the estate;
(c) the size and nature of the estate;
(d) the financial resources and needs of the claimant, any other eligible person or beneficiary to the estate;
(e) any disability of the claimant, or any other eligible person or beneficiary to the estate;
(f) the age of the claimant;
(g) any contributions by the claimant to building up the estate or to the welfare of the deceased or the deceased’s family;
(h) any benefit previously given by the deceased to any eligible person or beneficiary to the estate;
(i) whether the claimant was being maintained by the deceased before their death;
(j) the liability of any other person to maintain the claimant;
(k) the character and conduct of the claimant or any other person;
(l) the effects the family provision order would have on the amounts received by other beneficiaries from the deceased’s estate; and
(m) any other relevant matter.
Pursuant to s 91(5)(a) of the Act, a family provision order must not provide for an amount greater than is necessary for the eligible person’s proper maintenance and support.
‘Proper maintenance and support’ takes into account the vicissitudes of life of the claimant, it is not simply provision from the estate sufficient to alleviate poverty.[4] Determination of what constitutes proper maintenance and support involves the consideration of each of the mandatory and discretionary factors under the Act. It is not the role of the Court to ensure ‘fairness’ in the distribution of the deceased’s estate,[5] or to ensure equality amongst its beneficiaries.[6] It goes no further than making adequate provision for the proper maintenance and support of an applicant.[7] The nature and content of what is adequate provision is flexible and will adapt to conform to prevailing community standards. The task for the Court is to apply a broad evaluative judgment not constrained by preconceptions and predispositions.[8]
[4]Bosch v Perpetual Trustee Co Ltd [1938] AC 463, 476 (Lord Romer).
[5]Blair v Blair [2002] VSC 95, [15] (Harper J).
[6]Blore v Lang (1960) 104 CLR 124, 135 (Fullagar and Menzies JJ).
[7]See, eg, In re Hodgson (1955) VLR 481; Blair v Blair (2004) 10 VR 69; Delaney v Jones [2008] NSWSC 229.
[8]See, eg, Camernik v Reholc [2012] NSWSC 1537, [154] (Hallen J); Slack v Rogan (2013) 85 NSWLR 253, 284 [125]–[126] (White J).
Where an estate is large, there may be greater scope to make provision. However, this does not mean that the Court’s consideration of ‘proper maintenance and support’ is not limited by reference to an applicant’s need.[9]
[9]Re Buckland [1966] VR 404, 414 (Adam J).
The evidence
Steven filed an affidavit sworn 19 October 2018 and also gave viva voce evidence at the trial.
Both Gary and Anne filed affidavits, with Gary’s affidavit affirmed 20 December 2018 and Anne’s affidavit affirmed 20 December 2018. Anne also filed the affidavit of financial positon affirmed 11 November 2016. Both Gary and Anne gave viva voce evidence at the trial. They also relied on two affidavits sworn by their solicitor, Aaron Martin Jolly. The first of those affidavits, sworn 17 June 2019, exhibits several letters addressed to the remaining beneficiaries of the deceased’s estate, as well as their responses. The beneficiaries’ responses enclose unsworn statements detailing their relationships with the deceased, which are hearsay and irrelevant, save that the Court is satisfied that those beneficiaries have been made aware of the proceeding. The second affidavit of Mr Jolly, sworn 14 November 2019, exhibits three valuation reports for the deceased’s real property, referred to above.
General observations on the evidence
Steven’s affidavit comprises some twenty pages, yet contains little to no evidence that establishes any present need on his part. Fifteen pages of the affidavit set out the history of Steven’s relationship with the deceased, which is then followed by several bare assertions regarding Steven’s current position in life.
Steven’s assertions are not borne out by the five documents that are exhibited to his affidavit: a copy of the will, an x-ray report detailing his spinal injuries, a title search for De Burgh Road, a record of land transferred to Anne, and a market appraisal of that land. Of the exhibits to his affidavit, the only document that related at all to his current circumstances was the x-ray report, from which Steven distanced himself in his viva voce evidence. Steven asserted that his expenses are approximately equal to the income received from his disability support pension. However, he provided no list of weekly or monthly expenses, nor any other documentary evidence to support his assertions, as would normally be expected of a party seeking further provision from an estate.
On balance, Steven proved to be a wholly unreliable witness when subjected to cross-examination. His evidence was often evasive, internally inconsistent and he did not answer many questions put to him. By way of example, Steven was asked many questions concerning his consumption of alcohol, to which he gave evasive and unhelpful answers. He did not accept that he had ‘abused’ alcohol between 1996 and 2000 but gave evidence that he was ‘drinking too much’ at that time, a semantic distinction. When asked to clarify what he meant by ‘drinking too much’ he explained that he was ‘spending more than [he] could afford at the time’ on alcohol. He also repeatedly maintained that his drinking was now controlled, despite his own evidence that he attends the local pub most days each week.
Steven’s oral account of his own financial position transformed throughout the course of his cross-examination. When asked about the condition of the premises at De Burgh Road, his evidence was that his sons assisted to mow the lawns, and that they were not paid to do so. When later asked about his expenses, Steven’s evidence was that he paid his sons $100 every three weeks to assist with the mowing. Similarly, contradictory answers were given to questions concerning his relationship with the deceased. Initially, his evidence was that he twice visited the deceased in hospital following the deceased’s stroke in 2012. However, Steven’s answer to the question that immediately followed, that is, whether he expressed gratitude to his father for his ongoing support of Steven, was that he did not have any contact with his father.
On balance, Steven was an unreliable and evasive witness and the Court cannot comfortably rely on his evidence without corroborative evidence.
Both Gary and Anne gave their evidence in a clear and forthright manner and the Court accepts them as witnesses of truth. Where there is conflict between the evidence of Gary and Anne, and that of Steven, the Court has preferred the evidence of Gary and Anne.
Family history
The deceased was a farmer on the land situated on the Banks Road properties. Part of the farm originally belonged to the deceased’s father. It was given to the deceased, in part as a wedding present, and in part on his father’s death. The principal farming activity was sheep.
The deceased married his wife, Patricia, and together they had three children, Anne born 9 September 1955, Gary born 26 September 1958, and Steven born 4 August 1963. Steven, Gary and Anne all described the deceased as a ‘hard’ man who rarely showed emotion and a person who was generally critical of his children. As is common among farming families, each of the deceased’s children contributed to farm work around other commitments, such as school, sport and music lessons. Gary and Anne both left school at age 16. Steven completed school up to year 11, but did not obtain any high school qualification.
Patricia died on 13 November 1987. Shortly thereafter, the deceased entered into a relationship with Joyce Johnson, which continued until his death. The deceased and Ms Johnson were never married.
In 2012 the deceased suffered a stroke. He was admitted to Geelong Hospital and later moved to the Grace McKellar Rehabilitation Centre. Thereafter, the deceased spent a brief period in a care facility in Wallington, before living with Joyce in a house owned by her. Anne and Gary visited the deceased regularly and managed his affairs. Following his stroke, Steven visited the deceased on two occasions.
In March 2017 the deceased moved to an aged care facility in Moolap and he remained there until his death in September 2017.
Steven
After leaving school Steven qualified as a wool classer, in or around 1983. At the deceased’s suggestion, Steven relocated to Western Australia in search of work. The deceased purchased a motor vehicle for Steven to assist him in that endeavour. After a few years interstate, Steven returned to Victoria in mid-1987. Prior to his return, he crashed the motor vehicle given to him by the deceased, having fallen asleep at the wheel.
On the day of his mother’s death on 13 November 1987, Steven was arrested following a lengthy police pursuit. At the time, he was under the influence of alcohol and significantly above the legal blood alcohol limit. Steven was fined and his driver’s licence was confiscated. He has never renewed his licence.
In September 1993, Steven married Wendy Margaret Dodson. Together they had four children, Dwayne born in October 1988, Trevor born in December 1989, Mark born in April 1992, and Geoffrey born in April 1995.
In 1993 the deceased purchased the De Burgh Road property. He entered into an arrangement whereby Steven, Wendy and their children would occupy that property in exchange for the payment of rent of $120 per week. Under the arrangement Steven and his family were to eventually inherit the property. Steven failed to make any regular rental payments to the deceased, and eventually ceased making any payment at all.
The deceased also assisted Steven and his family with other expenses from time to time, such as his children’s schooling expenses.
In 1996, Steven and Wendy separated. After the separation, Steven’s consumption of alcohol increased. Although he denied the use of the term, Steven abused alcohol between 1996 and 2000.
Between 1987 and 1996 Steven worked intermittently for several employers. Between 1996 and 2005 he obtained casual labour work from time to time. He has not worked since 2005.
Steven attributes his inability to work to acute chronic back pain, which he suffers as a result of a workplace injury which occurred when he was working in Western Australia. The x-ray report exhibited to Steven’s affidavit describes his condition as biconcave scoliosis of the lower thoracic and lumbosacral spine, narrowing of the L3-4, L4-5 and L5-S1 disc spaces, small vertebral endplate osteophytes and osteoarthritis.
Steven sought treatment from a physiotherapist and a doctor for his spinal injury. In cross-examination, Steven explained that he treats the injury now by stretching and walking. The x-ray report also indicates that ‘[l]ocal anaesthetic and steroid can be injected in these joints using CT guidance if Steven’s symptoms not settling with conservative management.’ When asked why he had not pursued this form of treatment, Steven explained that his general practitioner had advised against it. Notably, Steven presented no evidence from his general practitioner which contradicts the recommendations contained in the x-ray report. When pressed on whether he relied upon the x-ray report, Steven was evasive and did not give clear answers.
Steven’s evidence was that his sole source of income is a disability support pension of $916 paid fortnightly. He has no savings, real estate, or a motor vehicle. His only assets are superannuation of approximately $2,000 and personal furniture and effects valued at approximately $800. Counsel for Steven submitted that Steven’s expenses are approximately equal to his disability pension. When asked what those expenses were during cross-examination, Steven listed the following:
(a) utility bills totalling $410 per month, approximately $94.62 per week.
(b) groceries of $100 per week.
(c) lawn mowing costs of $100 per three weeks, approximately $33.33 per week.
(d) cigarettes at $23 per day, approximately $161 per week.
As observed, Steven provided no documentary evidence to substantiate his asserted expenses. Calculated on a weekly basis, Steven’s expenses are $388.95 and subtracted from his weekly income of $458 the balance remaining is $69.05. Steven attributed the remainder of his expenses to his ‘outings at the hotel socialising’, and to travel expenses.
Gary’s evidence was that not only did Steven pay no rent, his father, and subsequently the estate, paid for the rates, insurance and other outgoings for the De Burgh property.
Gary
After leaving school, Gary undertook a mechanic’s apprenticeship. Between 1973 and 2009 Gary worked as a mechanic for several different employers located in various regional centres. Gary continued to assist the deceased on the farm around his work schedule.
From 2007 onwards, Gary’s involvement on the farm increased, as the deceased began to suffer ill-health. From 2009, Gary ceased his employment as a mechanic and worked full time on the farm. In 2010, Gary and the deceased entered into a farming partnership known as the G & G Dodson Partnership.
Since the deceased’s stroke in 2012, Gary has run the farm, including management of the partnership finances and the deceased’ personal finances.
Gary is unmarried and has no children. He suffers from asthma and Crohn’s disease, for which he is on medication. Gary’s Crohn’s disease occasionally affects his ability to work on the farm. Between 2010 and 2018 he has also had several surgeries for various physical impairments.
Gary’s current assets are as follows:
Assets
Value ($)
Savings
113,413.53
Shares and investments
457,375.54
Superannuation
121,831.61
Motor vehicles
8,166.00
50% share in the ‘G & G Dodson Partnership’
145,116.00
TOTAL
845,902.68
Gary has no current liabilities.
Gary’s only employment is his work on the farm, from which he has not drawn a constant wage since 2012. According to his affidavit, Gary’s monthly income is as follows:
Income
Income per month ($)
Partnership income from G & G Dodson Partnership
3,666.00
Index fund income
678.00
Transition to Retirement fund income
256.00
Share dividends
9.77
TOTAL
4,609.77
Gary’s annual income is therefore approximately $55,317.24. No evidence was provided as to Gary’s expenses.
Anne
Anne commenced work at the age of 18 in 1975 at a real estate agency. Between 1975 and 1987 she worked in several different administrative jobs, often in educational institutions. Anne married Duncan MacRae in 1984. Between 1987 and 1991 they had three children. Anne returned to work in 1999 at a local primary school. In 2000 she commenced employment as an Educational Support Officer at the Highton Primary School, where she currently works. Anne supplements her income by conducting children’s yoga classes and renting parts of her home through AirBnb.
In November 2013 the deceased transferred the property at 500 Andersons Road, Drysdale to Anne and her husband. That land formed a part of the family farm. Anne built a house on the land, in which she currently resides. In accordance with the deceased’s wishes, the remainder of the land continues to be used as a part of the family farm.
Anne and her husband divorced in December 2015. Anne’s children live independently of her. She suffers from several health ailments, including curvature of the spine, an auto-immune disease, chemical sensitivities and a fructose intolerance.
Anne’s current assets, including the property transferred to her in 2013, are as follows:
Asset
Value ($)
Property at 500 Andersons Road, Drysdale
1,400,000
Savings
2,300
Superannuation
70,000
Motor vehicles
20,660
TOTAL
1,492,960
Anne’s sole current liability is credit card debt of $594.
Anne’s monthly income is as follows:
Source
Income per month ($)
Employment at Highton Primary School
1,760.00
Children’s yoga classes
672.00
AirBnb rental
360.00
Lease to the Country Fire Authority
8.34
TOTAL
2,800.34
Anne’s annual income is therefore approximately $33,604.08. No evidence was provided as to Anne’s expenses.
Consideration
Factors that must be taken into account in making a family provision order: s 91A(1) of the Act
The terms of the deceased’s will are set out above at paragraph 8.
Steven submitted that the testamentary intention of the deceased in respect of him must have been to allow him to farm the land at 131 Banks Road. When it was put to Gary that the deceased must have considered that land to be viable as a separate entity from the family farm, Gary responded that the deceased may have thought he and Steven could work as a partnership. Throughout his evidence, Gary maintained that the farming land could not be farmed separately as it would not be financially viable.
The deceased made three earlier wills dated 29 July 2002, 23 December 2009, and 15 April 2010. The previous wills provide some insight into the deceased’s testamentary intentions. In particular, the deceased left a note addressed ‘To My Executors’ attached to his penultimate will dated 15 April 2010, which in respect of Steven stated as follows:
Steven is my youngest child. Steven has been difficult and fond of alcohol all his life. Steven has not worked for many years and has a bad back. Steven has four boys. Whilst he was married, and in 1993 I build a home at 52 De Burgh Road, Drysdale for Steven and his family to live in. Steven has never paid the rates for the property and has not paid me any rent. Steven does not maintain the property well. The garden is in a mess and although it has been some time since I have been to the property, Gary visited recently and could see that the kitchen was in a bad state. Steven has not worked since he injured his back at work but I do not believe he is looking very hard for work. Steven and I see each other approximately two or three times per year and we do not speak by telephone. It is my view that by making provision for him to have the use and enjoyment of 103 acres of the land, and the use and occupation of 52 De Burgh Road, Drysdale, together with one-half of my residuary estate held upon trust for his benefit, I am making sufficient provision for him.
The deceased’s final will altered the gift of the deceased’s residuary estate substantially. It disposed of the deceased’s share portfolio separately and split the residuary estate between each of his three children, rather than between Steven and Anne only. The gifts of the farm land and the house at De Burgh Road remained the same between the two wills. Despite changes made in the last will, the deceased’s note assists in understanding his testamentary intention, particularly with regard to the land at 131 Banks Road and the house at De Burgh Road.
Factors that may be taken into account in making a family provision order: s 91A(2) of the Act
Many of the discretionary factors that may be taken into account in making a family provision order under s 91A(2) of the Act are set out above and need not be repeated. The remaining discretionary factors are now set out.
(a) the nature of the relationship, including the length of the relationship, if relevant
Steven’s relationship with the deceased spanned 54 years.
The relationship was often strained and, from 2010 onwards, Steven was entirely estranged from the deceased. The deceased was described by all of his children as a hard man who was often critical of them. It may be the case that the deceased was particularly critical of Steven, whose alcoholism and failure to maintain consistent employment was a source of shame to the deceased.
The law recognises that the term ‘estrangement’ does not describe the conduct of either party, it is merely the condition that results from their attitudes or conduct.[10] Whether the fact of estrangement affects the claim of a plaintiff in family provision proceedings depends upon the facts of any given case, by reference to the nature of the estrangement and its underlying reasons.[11]
[10]Andrew v Andrew [2011] NSWSC 115, [74] (Hallen AsJ), reversed on a separate point on appeal (2012) 81 NSWLR 656, quoted in Brandon v Hanley [2014] VSC 103, [23]-[25] (McMillan J).
[11]Ibid.
The estrangement between Steven and the deceased came about following the deceased’s 80th birthday party. The evidence of Gary and Anne is that Steven became intoxicated and belligerent at the event, embarrassing the deceased before his family and friends. Steven did not depose to this event in his affidavit evidence. In cross-examination Steven did not accept that he was intoxicated, loud or obnoxious at the party. Thereafter, Steven occasionally saw the deceased at a local supermarket, but did not engage in any conversation beyond pleasantries. Steven says that he visited the deceased twice following his stroke in 2012, once in hospital and once at the Grace McKellar rehabilitation centre, but otherwise had no contact.
In 2016, Anne organised a family reunion. Anne deposed that the deceased requested that she invite Steven and his family to the event, but they did not attend. Anne says that she called and sent text messages to Steven and his children informing them of the reunion, but received no response. In cross-examination Steven said that neither he nor his children received text messages or phone calls from Anne.
The circumstances of estrangement between Steven and the deceased were largely as a result of Steven’s own actions. Aside from two occasions in 2012, Steven made no effort to contact the deceased or to support him as his health declined. Although there is no evidence that the deceased personally regularly tried to reach out to Steven, he did so through Anne in 2016 on the occasion of the family reunion and he allowed Steven to remain in the property at De Burgh Road without the payment of rent or other outgoings over many years. These actions demonstrate a softer side of the deceased and a person who wanted to help Steven as best he was able. On balance, Steven simply assumed the provision of the De Burgh Road property as his right and made little or no attempt to pay the rent and outgoings over the years.
(b) any obligations or responsibilities of the deceased to the eligible person, any other eligible person and the beneficiaries
Gary and Anne accept that the deceased had a moral responsibility for Steven. Likewise, the deceased had a moral responsibility for them.
(c) the size and nature of the estate
The net value of the estate is approximately $8.6 million.
The primary asset of the estate is the farm land at 100 Banks Road and 131 Banks Road. Collectively, those parcels of land comprise approximately 68 per cent of the value of the estate. Although the farm is split into two parcels of land for the purposes of the will, they were not farmed separately by the deceased. The land at 131 Banks Road, to which Steven claims an absolute entitlement, contains no infrastructure, save for fencing. There is also no water or electricity connected to the land.
Gary’s evidence was that he was able to run 300 sheep on the land at 131 Banks Road in conjunction with 100 Banks Road. Gary’s view was that 131 Banks Road was not viable as a separate entity from the farm as a whole, or that the farm as a whole would be viable in the absence of that land. In cross-examination Gary said that in the event Steven was provided an entitlement to 131 Banks Road, he would not provide Steven with access to the infrastructure on the land at 100 Banks Road.
(d) the current and future financial resources, earning capacity and financial needs of the eligible person and any beneficiary
The evidence of these factors has been set out above.
(e) any physical, mental or intellectual disability of any eligible person or any beneficiary
The evidence of Steven’s physical disability associated with his back injury has been set out above. Both Gary and Anne also suffer from medical conditions, as set out above, which do not presently affect their ability to work.
(f) the age of the eligible person
Steven is 56 years of age.
(g) any contributions of the eligible person, otherwise than for adequate consideration, to building up the estate or to the welfare of the deceased or the deceased’s family
Steven claims that he contributed to the building up of the estate by carrying out unpaid work on the farm from the age of ten, and working as a wool classer for ten or eleven seasons. Cheque receipts exhibited to Gary’s affidavit indicate that Steven worked on the farm for only six seasons between 1987 and 1995. Although Steven accepts that he was paid for his work as a wool classer, he says that he also carried out the work of a roustabout, penning sheep and wool pressing, for which he was not paid. However, it is observed that Steven was paid at a rate greater than that which would appear to have otherwise been market value for a wool classer’s work at the time, being that which he was paid by other employers.
Gary and Anne also assisted on the farm from a young age. Gary’s contribution to the farm continued as he pursued a career as a mechanic. Until 2010, when Gary and the deceased formed the G & G Dodson Partnership, he was not paid for his work on the farm.
Gary and Anne also made significant contributions to the care and welfare of the deceased in his later years, whereas Steven did not. After the deceased’s stroke in 2012, Gary maintained the farm, as well as the deceased’s finances. Anne regularly visited and cared for the deceased.
(h) any previous benefits to the eligible person or any beneficiary
The deceased provided Steven with several benefits throughout the course of Steven’s adult life. As set out above, Steven was provided with a motor vehicle in 1983 and with accommodation at the De Burgh Road Property, where he has lived for some 25 years whilst paying minimal rent, and no rent at all since 2002.
Anne received a significant benefit from the deceased in his gift to her of the property at 500 Andersons Road in November 2013.
Other than being named a partner in the G & G Dodson Partnership, there is no evidence of any previous benefit conferred upon Gary during the deceased’s lifetime.
(i) whether the eligible person was being wholly or partly maintained by the deceased, and if so, the extent and basis of such maintenance
Save for the deceased allowing Steven to reside in the property at De Burgh Road without paying rent, there is no evidence that Steven was being maintained by the deceased.
(j) the liability of any other person to maintain the eligible person
Steven takes the benefit of a government funded disability support pension but otherwise no person has liability to maintain him.
(k) the character and conduct of the eligible person or any other person
Steven’s conduct toward the deceased is discussed above.
Steven has had trouble with alcoholism for much of his adult life. In his affidavit he deposed that between 1996 and 2000 he abused alcohol. As observed, in cross-examination Steven did not accept that he had abused alcohol but instead proffered that he was ‘drinking too much’ at the time. Steven continues to drink heavily, visiting his local pub six or seven days per week.
(l) the effect that a family provision order would have on the amounts received from the deceased’s estate by other beneficiaries
The deceased’s estate can accommodate each of the deceased’s children, as well as the other named beneficiaries. However, the nature of the estate is such that part of the further provision requested by Steven, namely, an absolute interest in 131 Banks Road, will negatively affect the viability of the farm as a whole, as well as affecting the value of the inheritance received by Gary.
As stated, Gary offered to forego his one third share in the residuary estate in order to increase the nest egg available to Steven and obtain 131 Banks Road for his own use and benefit absolutely.
(m) any other relevant matter
Steven deposed that he wishes to farm the land at 131 Banks Road himself. However, the evidence called into serious question whether Steven has any relevant farming experience, and whether he is able to farm given his back injury and his lack of motivation to work at all.
Steven’s only qualification is as a wool classer. His only relevant experience is in wool classing, wool pressing, and as a roustabout. Although he worked on the farm as a child, those skills or knowledge do not equip him to run a farm at an operational level. When he did work on the farm for Gary in 2015, Steven was able to work only one day. Gary’s evidence is that Steven was unable to work due to excessive alcohol consumption, Steven says that he was unable to work due to his back pain.
Steven maintained that he could employ others to carry out the physical work on the farm. However, that does not alleviate the Court’s concern regarding Stevens’s ability to manage the day to day operation of a farm. In cross-examination Steven disagreed that farming the land was an unviable option for him. He suggested alternative modes of utilising the land, including share farming, agistment, or fattening livestock.
It was also pointed out to Steven that he has no means of travel between his home in Drysdale and the farm. Steven suggested that he could apply for his drivers’ licence, or request the assistance of one of his sons. In light of Steven’s history of driving offences and his current regular alcohol consumption, the former option appears to be an unlikely prospect.
On balance, there appears to be little prospect of Steven being able to put the land at 131 Banks Road to productive use. Steven has no farming experience beyond his work as a wool classer and carrying out chores as a child. Steven’s suggestion that he will employ others to work the land, or agist the land or share farm has little basis in reality. There is no infrastructure or electricity connected to the land and the only source of water is dams. These factors are relevant considerations to be taken into account when determining the nature and quantum of further provision to Steven.
Consideration
The sole issue for determination is what should be appropriate further provision for Steven.
General community standards expect that a testator will provide for an adult child, but it is not expected that this would be in such a manner as to look after that child for the remainder of his or her life and into retirement.[12] Determining an appropriate amount of provision includes the consideration each of the factors listed in s 91A(2) of the Act, as set out above.
[12]Walsh v Walsh [2013] NSWSC 1065, [121(c)] (Hallen J), cited in Smith v Jones [2015] VSC 398, [136] (McMillan J) and in Re McKenzie [2017] VSC 792, [92] (McMillan J).
Steven has been largely absent from the deceased’s life for the better part of 20 years. The circumstance of estrangement between them appears to have arisen from Steven’s actions at the deceased’s 80th birthday party in 2010. Since then, Steven has seen the deceased on only a handful of occasions. The deceased made an effort to reach out to Steven on at least one occasion, and continued to allow Steven to reside in his property at De Burgh Road.
Steven has not paid any rent since some time in 2002. At the agreed rate of $120 per week, that is a benefit of between $99,840 and $106,080 over that period. The deceased has also paid rates and insurance on that property, and has supported Steven’s children from time to time.
It is difficult on the evidence to draw any clear conclusion concerning Steven’s need. There is no evidence that Steven has any substantial assets or liabilities. It was submitted that Steven’s expenses are of approximate equality to the income received from his disability pension. However, there is no evidence that substantiates any expenses incurred by Steven, or any other need on his part. What is evident is that Steven has no buffer to meet future demands and uncertainties of life, such as ill health. At his age, and with his inability to work, Steven does not have the capability by reasonable means of providing adequately for his own future maintenance and support. This is alleviated, however, somewhat by Steven’s disability pension.
The further provision sought by Steven includes an absolute interest in 131 Banks Road. Gary’s evidence, which is preferred to that of Steven, is that 131 Banks Road is not a viable farm in isolation from the remainder of the farm property. His evidence was also that the separation of that land will negatively affect the viability of the rest of the farm and, therefore, his own inheritance. Steven presented no viable proposal for how he might farm 131 Banks Road, he has no relevant farming experience and cannot attend the farm without assistance from his children. Although regard must be had to the testamentary intentions of the deceased, as reflected in the terms of the will, Steven has little to no prospect of putting the land at 131 Banks Road to good use.
Conclusions
The defendants’ proposal is a practical and sensible resolution, which satisfies the deceased’s moral duty to provide for Steven’s proper maintenance and support, and also maintains the working integrity of the farm. That proposal ensures continued accommodation for Steven for the remainder of his life, as well as a substantial nest egg to support him in the future. In terms of further provision, it represents a generous proposal given the lack of evidence provided by Steven as to his need. The Court considers, however, that from the proposed provision there should a deduction of an amount for the unpaid rent and other outgoings in respect of the De Burgh Road property.
The Court is also concerned that in light of the evidence concerning Steven’s difficulties with managing his own affairs, and his continued drinking, Steven’s further provision ought remain on trust as set out in the residuary clause of the deceased’s will. Provision in this manner fulfils the purpose of providing Steven with adequate provision for his proper support and maintenance as well as following the deceased’s testamentary intentions towards Steven and the deceased’s grandchildren. It also secures Steven’s future without substantially affecting the benefits given to Gary and Anne.
The parties are to forward a proposed form of orders for consideration by the Court.
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