Re Stewart
[2020] VSC 737
•9 November 2020
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
TRUSTS, EQUITY AND PROBATE LIST
S ECI 2020 02322
IN THE MATTER of the will and estate of STEVEN CHRISTOPHER JOHN STEWART, deceased
- and –
IN THE MATTER of an application pursuant to order 54.02 of the Supreme Court (General Civil Procedure) Rules 2015
| ROBERT WATSON STEWART (in his capacity as executor of the estate of STEVEN CHRISTOPHER JOHN STEWART, deceased) | Plaintiff |
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JUDGE: | MOORE J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | On the papers |
DATE OF RULING: | 9 November 2020 |
CASE MAY BE CITED AS: | Re Stewart |
MEDIUM NEUTRAL CITATION: | [2020] VSC 737 |
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WILLS AND ESTATES – Judicial advice – Foreshadowed claim for further provision from estate – Where two claims for further provision from estate have already been settled – Where terms of settlement state that settlement is contingent on no additional claims for further provision being brought – Whether correspondence foreshadowing claim invalidates terms of settlement between executor and claimants – Issue turns on construction of terms of settlement – Foreshadowed claim does not constitute a further claim and does not invalidate terms of settlement – Whether correspondence foreshadowing claim constitutes a notice of intention to make an application for a family provision order under the Administration and Probate Act 1958 – Where correspondence specifies the identity of the claimant, the estate, and that the claimant will make a claim under the Administration and Probate Act 1958 – Correspondence does constitute a notice of intention to make an application for a family provision order – Administration and Probate Act 1958 s 99A.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr S Pitt | Saxby Lawyers |
HIS HONOUR:
Introduction
Steven Christopher John Stewart (the deceased) died on 24 January 2019, leaving a will dated 1 October 1992 (the will). The plaintiff was granted probate of the will on 16 April 2019.
Since probate was granted, two of the deceased’s children commenced claims under Part IV of the Administration and Probate Act 1958 (the Act) against the estate of the deceased. These proceedings have been compromised and are subject to terms of settlement dated 19 November 2019. The deceased’s alleged de facto partner, Susan Rose,[1] who is not a beneficiary under the will, has corresponded with the plaintiff in relation to a potential claim against the estate. No proceeding has been issued to date.
[1]For clarity and without intending any disrespect, I will initially identify the deceased’s relatives by their full names and subsequently refer to them by their first names.
On 25 May 2020, the plaintiff commenced this proceeding pursuant to order 54 of the Supreme Court (General Civil Procedure) Rules2015, seeking judicial advice in respect of:
(a) a clause of the terms of settlement dated 19 November 2019, pertaining to any foreshadowed claims against the estate by Susan; and
(b) whether any of Susan’s correspondence with the plaintiff in relation to the estate constitutes a notice of an intention to make an application for a family provision order for the purposes of sub-ss 99A(3) and 99A(4) of the Act.
On 12 June 2020, Judicial Registrar Keith made orders for the plaintiff to file submissions and for the application to be considered by a Judge of the Court on the papers.
Background
As noted above, the deceased died on 24 January 2019. He was survived by:
(a) three adult children, being Mikaela Lisa Cook, Shakira Lee Stewart and Jacob Stewart;
(b) his father, John Howard Stewart;
(c) his brother, Peter Thomas Stewart; and
(d) Susan, who asserts that she was the deceased’s de facto partner at the time of his death.
The will:
(a) appoints the plaintiff as executor;
(b) leaves the estate to the deceased’s parents John and Carmel Mary Stewart (Carmel predeceased the deceased), Peter and Mikaela; and
(c) gifted certain electrical appliances to Peter, with the balance of his chattels to be divided between the deceased’s parents, Mikaela and Peter.
The will was executed prior to Shakira and Jacob’s birth.
The deceased’s estate included a property in Aspendale Gardens in the State of Victoria valued at $810,000, a personal estate estimated to be valued at $125,978.84 and liabilities totalling $107,773.52.[2]
[2]According to the Inventory of Assets and Liabilities filed with the probate application, exhibited at ‘RS1’ to the plaintiff’s affidavit sworn 23 May 2020.
Jacob and Shakira commenced proceedings in the Court on 23 July 2019 and 7 August 2019 respectively pursuant to Part IV of the Act (the proceedings), seeking provision from the deceased’s estate.
The proceedings were subject to mediation on 19 November 2019. At this mediation, terms of settlement were agreed upon which would resolve Jacob and Shakira’s claims for further provision.
Clause 1 of the terms of settlement states:
These terms of settlement are subject to and conditional upon there being no further claims against the estate prior to distribution. Each of the plaintiffs, the beneficiaries and the defendant hereby undertake not to bring any claims or encourage any other party to bring any claims. If any further claims are made then these terms are null and void and stand as ’without prejudice’ negotiations only.
Since the death of the deceased, the plaintiff has deposed that he has received correspondence from, or on behalf of, Susan. Relevantly:
(a) on 12 March 2019, a letter and email were sent from Marsh & Maher Richmond Bennison Lawyers (MMRBL), who advised that they acted for Susan, that Susan was the de facto partner of the deceased, requested a copy of the will, and indicated that Susan was investigating her rights to make a claim against the estate and no distribution should be made until this matter is resolved;
(b) on 17 April 2019, correspondence was received from MMRBL indicating that Susan claimed certain chattels located at the property;
(c) on 20 May 2019, MMRBL wrote a letter to the plaintiff outlining that Susan was the domestic partner of the deceased, and that the deceased has not properly provided for eligible persons to whom he had a moral duty to provide, and that given the modest size of the estate and the obligations under the Civil Procedure Act 2010, it would be in all parties’ best interests to seek an early resolution of the matter without the need to formalise legal proceedings;
(d) on 12 April 2020, the plaintiff received an email from Susan stating, inter alia, ‘I believe it to be humanly right and just, that my relationship with Steven Stewart be recognised as what it was … it is my legal right to receive moneys from Steven Stewart’s estate as his recognised partner to the amount of $250,000’; and
(e) on 2 June 2020, Susan again emailed the plaintiff stating, inter alia, “$250,000 is reasonable, beyond a reasonable amount to be paid to me. I have been treated with disrespect as Steven’s long term partner, life partner. With regard to compensation for Steven’s tragic death, whether from Bingo Industries, Worksafe, TAC or all combined, it is right and just that John Stewart, Steven’s father and I Steven’s partner, receive half each”.[3]
[3]Taken from the affidavit of Peter Efklides sworn 17 June 2020.
The plaintiff’s application
Pursuant to order 54 of the Supreme Court (General Civil Procedure) Rules 2015, the plaintiff seeks judicial advice in relation to the following questions:
(a) does the receipt of the emails from Susan Rose dated 12 April 2020 and 2 June 2020 constitute “claims” for the purposes of cl 1 of the terms of settlement dated 19 November 2019 such as to render the terms of settlement null and void?
(b) do any, and if so which, correspondence from MMRBL dated 12 March 2019 (one letter and one email), 17 April 2019 or 20 May 2019, or the emails from Susan dated 12 April 2020 or 2 June 2020, constitute notice of an intention to make an application for a family provision order for the purposes of sub-ss 99A(3) and 99A(4) of the Act?; and
(c) depending on the answers to questions (a) and (b), then, in the events that have happened, would the executor be justified in distributing the estate of the deceased in accordance with the terms of settlement?
Principles
Section 99(1) of the Act imposes a six-month timeframe on the issuing of claims for further provision from the date on which probate is granted, with the Court empowered to grant an extension to this timeframe in the event the estate has not been distributed.[4]
[4]Administration and Probate Act 1958 ss 99(1) and 99(2).
Relevantly for the plaintiff’s application, s 99A of the Act establishes a protection regime for legal personal representatives in relation to foreshadowed claims:
99A Protection of personal representative against certain claims
…
(3)No action lies against a personal representative by reason of the personal representative having distributed any part of the estate if the distribution was properly made by the personal representative after the expiry of 6 months after the grant of probate of the will or of letters of administration (as the case may be) and either—
(a) the personal representative has not had notice of an application for a family provision order in respect of the estate; or
(b)if the personal representative has had a notice of an intention to make an application for a family provision order in respect of the estate in accordance with subsection (4), the personal representative has not received written notice that an application for a family provision order has been made to the Court within 3 months of the receipt of that notice of an intention to make an application for a family provision order.
(4)For the purposes of this section, notice to a personal representative of an intention to make any application for a family provision order referred to in subsection (3)(b)—
(a)must be in writing signed by the eligible person or the eligible person's legal practitioner; and
(b)lapses within 3 months from the receipt of the notice by the personal representative unless an application for a family provision order has been made to the Court; and
(c) is incapable of being renewed.
(5) Nothing in this section—
(a)extends the period within which a person can make an application for a family provision order without a Court order; or
(b)prevents the subsequent making of an application for a family provision order within any other period allowed by this Act.
In relation to the construction of these provisions, the plaintiff refers to the decision of Bell J in Younan v Younan (No 2),[5] where his Honour stated:
Sections 99 and 99A have analogues in the other Australian jurisdictions and in New Zealand. But the provisions vary in terms and cannot usefully be compared. The provisions have received very little judicial attention and nothing determinative. With respect to our provisions, there is no authority on point. Nothing in the legislative history or parliamentary materials assists with their interpretation.
[5][2015] VSC 549, [13] (Bell J).
The plaintiff has invited the Court to consider whether or not Susan’s emails amount to a claim for the purposes of the terms of settlement and therefore render the terms void, and whether any of the correspondence referred to at [12] above constitutes a notice under s 99A(3) of the Act, and thereby, with the duration of any such notice expiring, that he is entitled to distribute the estate without having regard to any potential claim brought by Susan.
Submissions
Paragraph (a) of the originating motion
The plaintiff submits that a plain reading of cl 1 of the terms of settlement suggests the words ‘further claims made against the estate prior to distribution’ should be read as meaning an application, by originating motion, for a family provision order against the estate of the deceased, and nothing less. In support of this construction, the plaintiff contends that:
(a) the phrase ‘further claims’ is used in terms of settlement that were settling two other such claims. The terms of settlement goes on to use the word ‘claim’ in the context of Part IV of the Act.
(b) the terms of settlement refer to ‘further claims made against the estate’; they do not refer to ‘foreshadowed claims, notice of claims or intended claims.’
The plaintiff also notes that Susan was previously represented by a solicitor, and it can be safely assumed that she was aware of her entitlements to commence a claim, and that such a claim would need to be brought by way of legal proceedings, rather than merely foreshadowed by email.
Paragraphs (b) and (c) of the originating motion
The plaintiff notes that, beyond sub-s 99A(4) of the Act, there is no standard form for a notice and its contents. The requirements of the subsection do not appear to have been considered by the Court and there is no authority addressing what wording might, or might not, satisfy the requirements of the subsection. Therefore, the question of what might constitute a ‘notice of intention a make an application for a family provision order’ is left to be determined by a plain reading of the subsection and the correspondence, and the application of common sense.
The plaintiff submits that the correspondence dated 12 March 2019, as a matter of common sense, cannot be considered to be notice pursuant to these provisions as it predates the grant of probate. If this were a valid notice, the three months in which the claim would need to be brought would start running before probate was granted, which cannot be correct as it is axiomatic that no claim could be brought before a grant is issued.
It is submitted that the correspondence sent on 20 May 2019 does amount to notice pursuant to s 99A(3) of the Act. It was issued following the grant of probate and clearly contemplates Susan making a claim against the estate of the deceased (particularly read with the earlier correspondence). On this basis, the date on which the three-month period effected by the notice would expire would be 21 August 2019. Pursuant to s 99A(4)(c) of the Act, this notice period has now concluded and is incapable of being renewed as no claim has subsequently been issued.
If the Court does not accept that the 20 May 2019 correspondence amounts to notice, the plaintiff submits that Susan’s email dated 12 April 2020 amounts to notice. It is contended that while the email does not specifically refer to the bringing of a family provision claim, given the correspondence from MMRBL, it can be assumed that Susan is aware of her legal right to bring such a claim, and so the reference to her legal right to receive from the estate the amount of $250,000 should be read to allude, if it does not specifically refer, to a Part IV claim. Given that Susan sent this email without solicitors, some latitude should be given in relation to the terminology, notwithstanding that she had previously received legal advice.
If the Court accepts that the 12 April 2020 email, and not the 20 May 2019 correspondence, is a valid notice, the time limit for such a notice would expire on 12 July 2020 and is not capable of being renewed.
In respect of the correspondence dated 2 June 2020, it is submitted that notice was given on either 20 May 2019 or 12 April 2020, and therefore the three-month timeframe in respect of the notice would expire on either 21 August 2019 or 12 July 2020. As this notice is incapable of being renewed by force of s 99A(4)(c) of the Act, any subsequent notice would be ineffective.
Consideration
Paragraph (a) of the originating motion
The emails received from Susan dated 12 April 2020 and 2 June 2020 do not constitute claims for the purposes of cl 1 of the terms of settlement dated 19 November 2019.
The Court accepts the plaintiff’s submission that the context in which the phrase ‘further claims against the estate prior to distribution’ appears supports a construction that excludes this correspondence. The phrase ‘further claims against the estate’ appears in a formal document that evidences a compromise of two litigated claims. In this context, it is logical and consistent with a plain reading of the text to interpret the phrase ‘further claims against the estate’ as meaning claims commenced pursuant to Part IV of the Act by way of legal proceedings. Against this factual background, it would be incorrect to attribute a more casual construction of this wording to include the somewhat vague assertions of an entitlement to the deceased’s estate contained in Susan’s email correspondence.
The Court also notes the tense of cl 1 of the settlement terms. It provides that the terms are null and void in the event further claims are made against the estate prior to distribution. The nature of this language is retrospective. It refers to claims made, not claims investigated, or claims foreshadowed. This tense is unambiguous and implies a requirement that a claim actually has been brought against the estate. This would be achieved by way of issuing proceedings in the Court.
Susan’s emails dated 12 April 2020 and 2 June 2020 do not meet this definition. While they express an entitlement to the deceased’s estate by virtue of her relationship, they merely express this entitlement and a wish to receive funds from the estate. They go no further than this. No specific demand for payment is made, nor is a formal claim issued. In this sense, Susan’s emails are too prefatory in nature to amount to ‘claims made’.
Paragraphs (b) and (c) of the originating motion
The Court refers to the plaintiff’s submissions that, other than the requirements of sub-s 99A(4) of the Act that the notice must be in writing, signed by the eligible person or the eligible person's legal practitioner, there is no further guidance in the legislation as to the form or contents of an adequate notice under sub-s 99A(3). Further, it is apparent that there is a dearth of judicial consideration on this provision.
The task of statutory construction requires the Court to give a provision the meaning that the legislature intended it to have. In Project Blue Sky v Australian Broadcasting Agency, McHugh, Gummow, Kirby and Hayne JJ stated that:[6]
… Ordinarily, that meaning (the legal meaning) will correspond with the grammatical meaning of the provision. But not always. The context of the words, the consequences of a literal or grammatical construction, the purpose of the statute or the canons of construction may require the words of a legislative provision to be read in a way that does not correspond with the literal or grammatical meaning.
[6](1998) 194 CLR 355, 384.
In this instance, the notice contemplated by sub-s 99A(3) is part of a broader regime for the protection of legal personal representatives, in light of foreshadowed claims. The language of the provision reveals an intention to provide an indemnity for the personal representative of an estate three months after they receive notice of an intention to seek an order for further provision, when no such claim is issued.
This suggests that a notice must be of sufficient detail and specificity to communicate an intention to seek further provision. In my view, at a minimum, the following should be readily discernible from a notice:
(a) the person who intends to seek orders for further provision;
(b) the estate to which such a claim will be made; and
(c) that there is a foreshadowed claim of the type contemplated by Part IV of the Act.
It is arguable that, on their face, the letter and email received on 12 March 2019 amounted to notice of an intention to seek a further provision order. However, it is inconsistent with the purpose of s 99A that a notice could be served at a time when a claim for provision could not be brought. The legislature cannot be taken to have intended that correspondence received before a claim could be made could amount to a valid notice for the purpose of the provision
The correspondence received on 17 April 2019 may also be disregarded; it focused on the deceased’s chattels, rather than a claim for further provision.
However, having regard to the matters to which I have referred in [32]-[33], I accept the plaintiff’s submission that the letter received from Susan’s then solicitors on 20 May 2019 amounts to notice under sub-s 99A(3). The letter is in writing and clearly conveys from its terms an intention by Susan to make a claim for further provision in relation to the deceased’s estate. So much is apparent from the reference in it to the claimed failure by the deceased in his moral duty to provide for Susan and the proposal that the issue be resolved out of Court. Reference to a moral duty is indicative of a claim contemplated by Part IV of the Act. Further, the letter was preceded by the correspondence on 12 March 2019 which indicated that Susan was investigating a claim.
I therefore consider that the letter of 20 May 2019 communicated an intention on behalf of a particular person, Susan, to make a claim for further provision as contemplated by Part IV the Act, against a particular estate, in this case the estate of the deceased. It follows that the time of such notice would have expired on 21 August 2019 and cannot be renewed.[7] Accordingly, it is not necessary for the Court to consider the subsequent correspondence.
[7]Administration and Probate Act 1958 s 90A(4)(c).
Orders
The Court orders and declares that:
1. Pursuant to r 36.01 of the Supreme Court (General Civil Procedure) Rules 2015, the originating motion filed 25 May 2020 be amended so that the orders sought read as follows:
a. Does the receipt of the emails from Susan Rose dated 12 April 2020 and 2 June 2020 constitute “claims” for the purposes of clause 1 of the Terms of Settlement dated 19 November 2019 such as to render the Terms of Settlement null and void?
b. Does any, and if so what, correspondence from MMRBL dated 12 March 2019 (one letter and one email), 17 April 2019 or 20 May 2019; or the emails from Susan dated 12 April 2020 and 2 June 2020 constitute notice of an intention to make an application for a family provision order for the purposes of ss 99A(3) and 99A(4) of the Administration and Probate Act 1958?
c. Depending on the answers to questions (a) and (b), then, in the events that have happened, would the executor be justified in distributing the estate of the deceased in accordance with the Terms of Settlement?
2.In answer to the question at paragraph a, the Court declares:
No. The emails received by the plaintiff from Susan Rose dated 12 April 2020 and 2 June 2020 do not constitute claims for the purposes of clause 1 of the Terms of Settlement dated 19 November 2019.
3.In answer to the question at paragraph b, the Court declares:
Yes. The correspondence from MMRBL dated 20 May 2019 satisfied the requirements of ss 99A(3) and 99A(4) of the Administration and Probate Act1958 (‘the Act’) with the effect that the 3 month time period ended on 21 August 2019.
4.In answer to question at paragraph c, the Court declares:
Yes. Susan Rose is out of time to bring a claim for the purposes of s 99 of the Act. Her 3 month window for the purposes of s 99A(3) has expired. The plaintiff cannot be pursued personally, and is free to distribute the estate in accordance with the Terms of Settlement.
5.The costs of the proceeding be retained or paid from the estate of the deceased.
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