Re Tang
[2017] VSC 59
•24 February 2017
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
TRUSTS, EQUITY & PROBATE LIST
S PRB 2015 16629
IN THE MATTER of the Will and Estate of MING ZHENG TANG (also known as TANG MING ZHENG and JAMES TANG), deceased
| BI XIA ZHANG (also known as ZHANG BI XIA) | Plaintiff |
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JUDGE: | McMillan J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | On the papers, written submissions filed by the plaintiff on 17 May 2016 and 10 October 2016 |
DATE OF JUDGMENT: | 24 February 2017 |
CASE MAY BE CITED AS: | Re Tang |
MEDIUM NEUTRAL CITATION: | [2017] VSC 59 |
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PROBATE —Application for grant of representation in Victoria — Where deceased left handwritten note disposing of monetary assets in Victoria but not all assets or any assets in the People’s Republic of China — Where note written in Chinese language and executed in the People’s Republic of China — Wills Act 1997, ss 7, 9, 17, 18
PRIVATE INTERNATIONAL LAW — Choice of law — Succession — Where deceased is an Australian citizen —Where deceased resided in the People’s Republic of China since 2003 — Whether deceased intended to reside there permanently or for an indefinite time — Domicile of choice— Where all assets of the deceased’s estate are movable — Whether will executed in conformity with internal law of People’s Republic of China — Whether estate falls on intestacy — Domicile Act 1982 (Cth), ss 10, 11, 12 —Domicile Act 1978, s 9, 10, 11 — Re Fuld’s Estate (No 3) [1968] P 675; [1965] All ER 776 — Harrison v Harrison [1953] 1 WLR 865 — Hyland v Hyland (1971) 18 FLR 461 — Ross v Ellison or Ross [1930] AC 1
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | S Aufgang | Xianyi Tan Barrister & Solicitor |
HER HONOUR:
Introduction
Mr Tang Mingzheng[1] died on 26 November 2014 (‘the deceased’ or ‘the testator’), aged 41 years. He died in Shanghai in the People’s Republic of China (‘China’). At the date of his death, the deceased was an Australian citizen and resident in China.
[1]To maintain consistency of naming, the family names have been placed before the given names consistent with Mandarin Chinese.
On 14 November 2014, the deceased wrote a handwritten note in the Chinese language on a small scrap of paper the size of an envelope (‘the note’). The note was to his mother, who is the plaintiff in this proceeding. It was signed by him and dated 14 November 2014. His signature on the note was not witnessed. The translation of the note reads as follows:
Mama:
In Australia, I only have two bank accounts with Westpac. One account is the one you regularly deposit $50 every month, and the other one is a three-year term deposit account. Both account bankbooks are at your place. Remember, the money in both accounts is for your personal use only. Take care!
Tang Ming Zheng
Date: 14/11/2014
By originating motion filed 30 October 2015, the plaintiff seeks a grant of letters of administration with the will annexed. Whilst no legislation is specifically relied on in support of the application, in submissions counsel for the plaintiff relied on s 9, alternatively, s 17 of the Wills Act 1997 (‘the Act’). The application seeks to establish that the note is the deceased’s will. The plaintiff is the mother of the deceased. She is an Australian citizen and lives in Bundoora, Victoria. She claims that she is the sole beneficiary named in the note. There is no executor named in the note.
The assets of the deceased in Australia and China
The inventory of assets and liabilities filed with the application referred to assets in Victoria and China as follows:
Victorian assets
Moneys in Westpac Banking Corporation held
on term deposit and account numbered [xxx] $121,838.19
Motor vehicle 2011 Mercedes Benz C200 $ 30,000.00
Total assets in Victoria$151,838.19[2]
[2] The total of the Victorian assets was incorrectly totalled to $179,307.77 and should be $151,838.19.
Assets in China
Moneys in Minmetals International Trust Co Ltd
(CNY 1,500,000 converted to Australian dollars) $286,764.00
Moneys in HSBC Bank (China) Company Ltd
(CNY 333,553.36 converted to Australian dollars) $ 63,766.40
Moneys in Hong Kong and Shanghai Bank
(USD 25,720 converted to Australian dollars) $ 30,173.42
Cartier wrist watch
(CNY 180,000 converted to Australian dollars) $ 34,411.68
Total assets in China$415,115.50
The deceased had a credit card liability in China which converted to approximately $A6,599.63.
The combined total of the deceased’s assets as the date of his death, correctly totalled, amounted to $566,953.69. According to this calculation, approximately three quarters of the deceased’s estate is located in China.
Factual background
On 10 November 2014, the deceased was admitted to Shanghai No 1 Hospital, complaining of acute chest pains. He had suffered from heart problems in the past, including a heart attack when he was aged 34 years.
On the same day as his admission to hospital, the plaintiff received an email from the brother of her ex-husband informing her that her son was very sick in hospital. He told her that she should immediately travel to China to see him. The plaintiff was aware of her son’s previous heart problems and she obtained an emergency visa to travel to China. She arrived in Shanghai late on 13 November 2014.
On 14 November 2014, she visited the deceased in hospital. She took her belongings with her and was permitted to stay at the hospital with him. Her observation of him on that day was that he seemed quite well and her expectation was that he would make a full recovery. Some time that day, the plaintiff left the hospital to do some shopping, leaving him alone. On her return she found the note and asked him about it. He replied the note was written in case something happened to him and he needed to make sure that she got the money held in the two bank accounts referred to in the note.
The deceased remained in hospital and was transferred into the hospital’s intensive care unit where he remained until his death. The plaintiff deposed in her third affidavit that a couple of days before he died, the deceased offered to give her his pin number of his ‘day to day’ Westpac account. She asked him not to do so as there were other people in the unit who could overhear their conversation. It is not clear from the inventory of assets which of the two accounts the deceased was referring to when he spoke of his ‘day to day’ Westpac account.
The plaintiff’s application
The plaintiff’s application was supported by her affidavit sworn 29 October 2015 in which exhibited the deceased’s death certificate, a certificate establishing her relationship to her son, the inventory of the assets and liabilities of the estate in both Victoria and China and an affidavit of publication of notice and searches.
By letter dated 2 November 2015, the Registrar of Probates raised a number of requisitions, including amongst other matters, the following:
(a) that the note does not necessarily appear ‘testamentary’;
(b) by what rule of law is it so and for the plaintiff to file an opinion and affidavits to support the contention that the note could be regarded as a will;
(c) was the note validly executed as a ‘will’ under the law in China;
(d) assuming the note is testamentary, it has not been executed in conformity with s 7 of the Act and is accordingly invalid and evidence should be filed to support any contention that the deceased intended the note to be a will;
(e) evidence is required concerning the marital status of the deceased, whether he had a domestic partner or children surviving him and whether his father survived him; and
(f) identify what relatives or next of kin are entitled to share in the estate undisposed of in the event that the note is testamentary.
On 1 June 2016, the plaintiff filed a supplementary affidavit that described in greater detail the circumstances of the deceased’s immediate family as follows:
(a) the deceased’s father, Tang Lishen, is alive and living in China;
(b) the deceased married Fan Yufan, also known as Rachel Fan, on 6 February 2003 in Melbourne. The deceased was married to Ms Fan at the date of his death. They both moved to live in China after their marriage in Melbourne. She believes that the deceased and Ms Fan separated about ten years prior to the death of the deceased;
(c) Ms Fan attended the funeral of the deceased;
(d) the plaintiff believes that the deceased did not have any other domestic partner at the date of his death;
(e) the deceased did not inform her that he had children and she believes that he did not have any children as at the date of his death; and
(f) in 2015, the plaintiff, the deceased’s father and Ms Fan attended various financial institutions together in China to determine the assets of the deceased and no mention was made by either of them as to the existence of any children of the deceased.
The plaintiff deposed that Ms Fan informed the plaintiff’s solicitor that she had a son born in May 2013, who she claimed is the deceased’s son. Ms Fan forwarded a copy of the child’s birth certificate issued on 4 July 2013 to the plaintiff’s solicitor. The birth certificate records the deceased as the father of the child and that the child was born on 12 May 2013. The child’s last name is Fan, after his mother. Ms Fan told the plaintiff’s solicitor that she had planned to keep the existence of the deceased’s son a secret and asked him to keep it a secret and that she did not intend to make any claim against the deceased’s estate on behalf of the child.
A text message sent by Ms Fan to the plaintiff was exhibited to her affidavit sworn 27 May 2016, and the translation reads as follows:
Plaintiff: I have received the documents you sent.
Ms Fan:Ok, that’s good. Although I have given you the photocopy of my son’s birth certificate, please keep it confidential for me, because I didn’t mean to take up more shares of the heritage. Thank you.
Plaintiff:I am not your lawyer. By law, all the documents you provided must be submitted.
The plaintiff also deposed that she asked Ms Fan why she wanted to keep the existence of the child a secret. She deposed that Ms Fan said that she worried the deceased would want to see the child, would insist on changing the child’s surname to Tang and that she did not want trouble with the deceased’s father or uncle, both of whom she feared as she felt intimidated by them. As a result, the plaintiff has not informed the deceased’s father about the existence of the child and deposed:
I simply do not know if the deceased’s widow’s son is my grandson or not. Therefore I do not know if my son had any children that survived him.
The plaintiff exhibited two signed consent of beneficiary forms drawn by her solicitor and signed by the deceased’s father and Ms Fan. The plaintiff deposed that she believed that the deceased’s father and Ms Fan had sufficient command of the English language to understand the documents. They are in similar terms, with the consent of the deceased’s father stating as follows:
1.I, Li Sheng Tang (also known as Tang Li Sheng), of [address], the father of the Deceased, Ming Zheng Tang (also known as Tang Ming Zheng and James Tang), do hereby consent to my ex-wife, Bi Xia Zhang (also known as Zhang Bi Xia), being given Letters of Administration by the Supreme Court of Victoria for the purpose of admitting to Probate the document signed by the Deceased on 14 November 2014 (“the Document”).
2.I believe that the Deceased intended the Document to be his last Will which would dispose of his monetary assets in Australia.
3.To the best of my knowledge the Deceased had no other Will and, as a consequence, I understand that the rest of his assets will be disposed of according to the laws of intestacy or by agreement amongst his closest beneficiaries, being his wife Fan Yu Fan (also known as Rachel Fan), his mother Bi Xia Zhang and me, his father.
The plaintiff deposed that she was prepared to give an undertaking to the Court that if a DNA test proved that the deceased was the child’s biological father, she would ‘ensure that he gets his proper share of the deceased’s estate’. She did not depose as to what she meant by the phrase ‘his proper share’ yet she deposed that she has been told by her solicitor and believes that:
(a) under the law in China, Ms Fan, the deceased’s father and her, together with any children that the deceased may have had, have equal rights of succession; and
(b) under Victorian law, the deceased’s widow and any children he may have had would be entitled to share in the undisposed assets of the deceased’s estate and that she and the deceased’s father would not automatically be so entitled.
The application was first listed for directions on 24 June 2016 where the Court raised a number of difficulties with the evidence with counsel for the plaintiff, including the absence of any evidence of the deceased’s testamentary capacity when he wrote the note. These issues were raised in addition to the requisitions already raised by the Registrar of Probates.
On 12 October 2016, the plaintiff filed a further affidavit exhibiting a medical report that describes the deceased’s condition at the time of his admission to hospital, the progressive deterioration of his health and the cause of his death. Correspondence between the plaintiff’s solicitor and the hospital where the deceased was treated seeking further information on the question of capacity was also exhibited to the affidavit.
The medical report prepared by Dr Yan on 27 November 2014 does not address the issue of the deceased’s testamentary capacity at the time the note was made. It simply refers to his treatment during his time at the hospital. To the extent that the medical report can be understood by the Court, it records that the deceased suffered repeated episodes of acute heart failure on an almost daily basis after his admission on 10 November and did not respond well to ‘our therapy’ with his condition worsening progressively until his death from cardiac arrest on 26 November 2014. This evidence stands in stark contrast to the plaintiff’s assessment of her son’s condition on 14 November 2014, namely, that she expected he would make a full recovery.
The plaintiff’s further affidavit also deposed to the fact that the deceased was born in China and came to Australia in about 1990. He took out Australian citizenship in about 1997. He married Ms Fan, a Chinese resident, in 2003. After they married, Ms Fan wanted to return to live in China. The plaintiff deposed that the deceased agreed to this as his job prospects were better in China than in Australia. She deposed that although the deceased and Ms Fan separated a few months after they returned to live in China, the deceased remained living in China as he was settled in a new job. He first lived in Shanghai for a year or two and then transferred to Beijing. He returned to live in Shanghai in about 2011. He visited Australia for about two weeks at Christmas and sometimes for a week around Easter. The plaintiff deposed that the deceased had no intention of giving up his Australian citizenship and planned to return to Australia even though he continued to work in China for more than a decade.
The proceeding was listed for directions on two further occasions where the utility of appointing independent counsel to assist the Court on the issues that arise in the proceeding, including the issue of choice of law and domicile of the deceased, was raised by the Court. Counsel for the plaintiff was adamant in opposing such a proposal, noting that all persons interested in the estate had consented to the application.
The onus of proof
The plaintiff bears the onus of proof on the balance of probabilities. Although in every civil case, the standard to be applied is uniform, in each case the nature of the issues and the consequences flowing from the facts once proven, will necessarily affect the process by which reasonable satisfaction is attained.[3] This feature of the civil standard of proof is stated in the judgment of Dixon J in Briginshaw v Briginshaw.[4]
[3]Briginshaw v Briginshaw (1938) 60 CLR 336, 360-363 (Dixon J).
[4](1938) 60 CLR 336.
In probate cases involving informal testamentary documents, the Briginshaw principle must be applied with care, as Habersberger J stated in Fast v Rockman:
The person seeking to propound an informal will must establish the requisite elements on a balance of probabilities. Furthermore, because of the nature of probate, the consequences of any findings that may be made and the inability to hear any evidence from the deceased as to his actual intentions, the Court needs to evaluate the evidence with great care in accordance with the Briginshaw v Briginshaw principle.[5]
[5]Fast v Rockman [2013] VSC 18 (7 February 2013), [48] (citations omitted).
The Briginshaw v Briginshaw principle dictates that reasonable satisfaction should not be attained by ‘inexact proofs, indefinite testimony, or indirect inferences’.[6]
[6]Briginshaw v Briginshaw (1938) 60 CLR 336, 362 (Dixon J). Note that this standard of proof is set out in s 140 of the Evidence Act 2008.
Where an informal testamentary document satisfies the requirements of s 9 of the Act, a grant of representation could still in theory be refused where a testator lacked testamentary capacity, did not know and approve of the will, or was affected by undue influence in making the will. If the deceased lacked the capacity to make a will, then the Court could not be satisfied that the deceased intended the document to be his or her will. If a testator did not know and approve of the document, then the Court could not be satisfied that he intended the document to be his will. If the testator was unduly influenced in the sense recognised by the Courts of Probate, such that his will were overborne, then the Court could not be satisfied that he intended the document to be his will.[7]
[7]Re Stuckey [2014] VSC 221 (23 May 2014) [40]–[41] (McMillan J).
For these reasons, issues related to the capacity of the deceased, the knowledge and approval of the testator and any undue influence on him are relevant factors in considering whether the note satisfies s 9 of the Act.
As there was no contradictor to the application or independent counsel appointed by the Court, the plaintiff’s affidavit evidence could not be tested by cross examination. Insofar as the affidavits convey facts supported by admissible documentary evidence, those facts can be readily accepted. Thus, I accept that the deceased died in hospital on 26 November 2014, that the plaintiff is his mother and that the translation of the contents of the note is true and correct. I also accept that the deceased and the plaintiff were Australian citizens at all relevant times.
Other statements made by the plaintiff cannot be readily accepted. Statements made by the plaintiff to her belief where she fails to state the basis of her belief cannot be accepted. Statements as to certain critical events that occurred where no other person was present, such as her discussions with the deceased while she was with him in hospital, must be treated with caution as they cannot be corroborated. The plaintiff was not present when her son wrote the note yet she deposed that he wrote it without stating any evidence for her statement. The plaintiff also deposed that the deceased stated to her that he intended to return to Australia permanently yet the facts before the Court do not support that statement.
Any statements or documents made by Ms Fan or the deceased’s father, either to her or to her solicitor, such as their consents to her application, must also be treated with caution. It is not known whether they have received independent legal advice or are aware of the purport of the application. This is particularly concerning in light of recital two of the ‘consent’ signed by each of the beneficiaries, which states that each of them believes the note to be a testamentary document. It is unclear how lay people could come to such a conclusion without legal advice as to the effect of the law in Victoria and China in respect of the note. Affidavits have not been filed by Ms Fan or the deceased’s father on any issues, including an interest in the estate of the deceased, that affect them. The issue as to whether Ms Fan’s son is the child of the deceased is unresolved. If the deceased is the biological child of the deceased, questions arise as to whether he has an interest in the estate of the deceased under the intestacy provisions in Victoria and in China.
Plaintiff’s submissions
Counsel for the plaintiff filed a document dated 17 May 2016 described as a ‘legal opinion’ in which three potential legal characterisations of the note were identified:
(a) the note may have constituted a donatio morits causa, or deathbed gift, made by the deceased to his mother and made absolute upon his death;
(b) the note may have constituted an informal will pursuant to s 9 of the Wills Act 1997 (‘the Act’); or
(c) the note may have been a valid will executed in a foreign place, pursuant to s 17 of the Act.
The legal opinion identified the deceased’s domicile and habitual residence at both the time the note was written and the time of his death to be China. Subsequently, in further legal submissions filed on 12 October 2016, counsel reversed this opinion as to the deceased’s domicile and habitual residence, submitting that at all relevant times, the deceased’s domicile was in fact Victoria, relying on the plaintiff deposing that ‘the deceased and I often spoke about him returning to live permanently in Australia’ as evidence that the deceased had no intent to make his home indefinitely in China.[8]
[8]Counsel cited s 9 of the Domicile Act 1978, which states, ‘The intention that a person must have in order to acquire a domicile of choice in a country is the intention to make his home indefinitely in that country.’
Counsel submitted that the note ought be considered a will, whether under s 17 or s 9 of the Act, as this outcome would provide certainty for the beneficiaries who had consented to the granting of the plaintiff’s application for a grant of letters of administration with the will annexed of the deceased’s estate.
Counsel submitted that as the deceased was domiciled in Victoria, Victorian law should apply to the distribution of all of the deceased’s movable assets, following the rule that in determining what law applies, the domicile of the deceased will determine the applicable law in the case of movables of the deceased.
Counsel submitted that as the plaintiff was the deceased’s closest living relative in Victoria, letters of administration ought be granted to her and, if necessary, to dispose of the majority of the deceased’s estate in China by way of a reseal of the grant in China.
The law in Victoria
When an estate is to be administered, the existence or otherwise of a valid legal instrument, such as a will or testamentary document must be identified. Otherwise, the intestacy provisions apply. Interested persons who may be affected by an application for a grant of representation must be identified and notified of any application before the Court. Where a will or testamentary document is sought to be propounded, the named executor is the usual applicant, although in certain circumstances a beneficiary with the highest interest may bring an application to propound the will or testamentary document. Generally, on an intestacy, the person with the largest interest in a deceased estate is entitled to make application for a grant of representation. Under the Victorian intestacy provisions, the widow and children of a deceased person are the beneficiaries of an intestate estate.
Where there is a testator, it is necessary to determine whether the formal requirements for a validly executed will are met, as set out in s 7 of the Act. The note in question in this proceeding does not satisfy these formal requirements. The plaintiff’s application seeks that the Court dispense with those requirements in accordance with s 9 of the Act which provides as follows:
9When may the Court dispense with requirements for execution or revocation?
(1) The Supreme Court may admit to probate as the will of a deceased person—
(a) a document which has not been executed in the manner in which a will is required to be executed by this Act; or
(b) a document, an alteration to which has not been executed in the manner in which an alteration to a will is required to be executed by this Act—
if the Court is satisfied that that person intended the document to be his or her will.
…
(3) In making a decision under subsection (1) or (2) the Court may have regard to—
(a) any evidence relating to the manner in which the document was executed; and
(b) any evidence of the testamentary intentions of the testator, including evidence of statements made by the testator.
(4) This section applies to a document whether it came into existence within or outside the State.
Thus, in order to admit an informal will to probate under s 9 of the Act, the Court needs to be satisfied that the following criteria have been established on the balance of probabilities:
(a) there must be a ‘document’;
(b) the document must express or record the testamentary intentions of the deceased; and
(c) that document must have been intended by the deceased to be his or her will.[9]
[9]Fast v Rockman [2013] VSC 18 (7 February 2013) [46] (Habersberger J); Rowe v Storer [2013] VSC 385 (2 August 2013) [32] (McMillan J). See also, Re Masters; Hill v Plummer (1994) 33 NSWLR 446, 449 (Kirby P), 455 (Mahoney JA), 466 (Priestley JA); Hatsatouris v Hatsatouris [2001] NSWCA 408 (30 November 2001) [56] (Powell JA, with whom Priestley and Stein JJA agreed); Oreski v Ikac [2008] WASCA 220 (31 October 2008) [52]–[53] (Newnes AJA, with whom Martin CJ and McLure JA agreed); Re Trethewey (2002) 4 VR 406, 408 (Beach J); Equity Trustees v Levin [2004] VSC 203 (26 May 2004) [15] (Whelan J); Prucha v Standing [2011] VSC 90 (22 March 2011) [6] (Beach J); In the Will and Estate of Brian Bateman [2011] VSC 277 (24 June 2011) [42] (J Forrest J).
An application under s 9 of the Act is assessed by reference to the requisite document, with the inquiry directed towards whether the deceased intended the document to have effect as a testamentary document. The intention of the deceased is a matter of fact and each case depends on its own facts and circumstances.[10] The fact that a deceased has read and signed a document is not determinative of the issue.[11]
[10]Estate of Peter Brock [2007] VSC 415 (24 October 2007) [23] (Hollingworth J).
[11]Fast v Rockman [2013] VSC 18 (7 February 2013) [66] (Habersberger J).
Given that the deceased executed the note in China and that he resided in China from 2003 until the date of his death, the provisions of the Act that deal with wills to which foreign laws apply and what law applies to the plaintiff’s application become relevant. These provisions are as follows:
17 General rule as to validity of a will executed in a foreign place
(1) A will is to be taken to be properly executed if its execution conforms to the internal law in force in the place—
(a) where it was executed; or
(b) which was the testator's domicile or habitual residence, either at the time the will was executed, or at the testator's death; or
(c) of which the testator was a national, either at the date of execution of the will, or at the testator's death.
…
18 Ascertainment of the system of law which applies to a will
If, in the case of a will to which the internal law in force in a place is to be applied, there is more than one system of internal law in force in the place which relates to the formal validity of wills the system to be applied is determined as follows—
(a) if there is a rule in force throughout the place which indicates which system applies to the will, that rule must be followed; or
(b) if there is no rule, the system must be that with which the testator was most closely connected—
(i) at the time of his or her death, if the matter is to be determined by reference to circumstances prevailing at his or her death; or
(ii) in any other case, at the time of execution of the will.
19 Construction of the law applying to wills
(1) In determining whether a will has been executed in conformity with a particular law, regard must be had to the formal requirements of that law at the time of execution, but account may be taken of a later alteration of the law affecting wills executed at that time, if the alteration enables the will to be treated as properly executed.
(2) If a law in force outside Victoria is applied to a will, a requirement of that law that special formalities must be observed by testators of a particular description or that the witnesses to the execution of a will must have certain qualifications, is to be taken to be a formal requirement only, despite any rule of that law to the contrary.
The ascertainment of what law applies to the plaintiff’s application is a question of fact in Australian courts. As the learned authors of Cross on Evidence state:
The existence, the nature and the scope of the rules and principles of law of a foreign jurisdiction are issues of fact to be decided by the judge on which evidence is receivable; on the other hand, the effect of the application of those rules and principles, as so ascertained, to the particular facts and circumstances of the case before the court is a question of law for the court of the forum, on which evidence is not receivable.[12]
[12]LexisNexis, Cross on Evidence (at 16 January 2017), [41005].
The necessary caution with which foreign municipal law must be treated by judges accustomed to the application of Australian law is elaborated upon by Gummow and Hayne JJ in a choice of law case that involved the interpretation of a statute in China:
The courts of Australia are not presumed to have any knowledge of foreign law. Decisions about the content of foreign law create no precedent. That is why foreign law is a question of fact to be proved by expert evidence. And it is why care must be exercised in using material produced by expert witnesses about foreign law. In particular, an English translation of the text of foreign written law is not necessarily to be construed as if it were an Australian statute. Not only is there the difficulty presented by translation of the original text, different rules of construction may be used in that jurisdiction.[13]
[13]Neilson v Overseas Projects Corporation of Victoria & Anor (2005) 223 CLR 331, 370 [115] (Gummow and Hayne JJ) (citations omitted).
No expert evidence was called by the plaintiff to establish the nature and the scope of the rules and principles of the law in China applicable to this proceeding. An English translation of the Chinese succession law was exhibited, however, it does not provide a sufficiently clear indication, especially absent the benefit of expert evidence, as to how the note would be treated under Chinese law or, if it is not a testamentary document under Chinese law, the correct intestacy procedure to be followed.
The law in China
The Court’s understanding of the scope of the rules and principles of the law in China applicable to this proceeding is limited as it has not been provided with any expert evidence on this issue. As a result, the Court makes no findings as to the application of the law in China or to its existence but simply sets out the result of its research on the issue.
The post-1978 reform and opening up policies enacted in China unleashed a globally unprecedented boom of civil economic activity. The legal frameworks that regulated these new activities have often been developed in tandem with, or in response to, these new forms of activities. Professor Jianfu Chen broadly describes the development of Chinese civil law as:
Following the European Continental tradition, Chinese civil and commercial legislation has on the one hand taken a formalist and abstract approach, despite ideological differences underlying the law and law-making. On the other hand, because of the delay in enacting a comprehensive civil code, legislation has taken an ad hoc approach towards specific situations, and hence the legal framework governing civil and commercial matters has been fragmented and unsystematic.
Without a comprehensive civil code, the GPCL (General Principles of Civil Law) is the only, albeit simplistic, piece of legislation that provides some general principles for creating and defining the structure of civil law, as well as establishing the basic abstract civil law institutions. The actual regulation of specific civil and commercial relations is done through a large body of civil and commercial laws, regulations, measures and judicial interpretations.[14]
[14]Jianfu Chen, Chinese Law: Context and Transformation (Martinus Nijhoff, 2008), 338.
General principles of civil law and succession law in China
The General Principles of Civil Law (‘the GPCL’),[15] read in conjunction with the Opinions on Several Issues concerning the implementation of the GPCL (‘the GPCL Opinion’),[16] provide a non-exhaustive set of general principles that provide for particular fundamental rights for citizens to engage in economic activity with each other as equals.[17] Pursuant to Article 76, citizens shall have the right of inheritance under the law.[18] Article 15 of the GPCL provides:
The domicile of a citizen shall be the place where his residence is registered; if his habitual residence is not the same as his domicile, his habitual residence shall be regarded as his domicile.
[15]General Principles of the Civil Law of the People's Republic of China (People’s Republic of China) National People’s Congress, 1 January 1986 (amended 27 August 2009).
[16]Notice of the Supreme People's Court on Issuing the Opinions on Several Issues concerning the Implementation of the General Principles of the Civil Law of the People's Republic of China (For Trial Implementation) (People’s Republic of China) Supreme People's Court, 2 April 1988 (amended 24 December 2008).
[17]GPCL, Art 3
[18]GPCL, Art 76.
Chapter XIII of the GPCL deals with the application of law in civil relations with foreigners, until the passing of the Conflicts Act[19] in 2011, it was the only legislation that provided guidance on conflict of law issues. Pursuant to article 149 of the GPCL:
In the statutory succession of an estate, movable property shall be bound by the law of the decedent's last place of residence, and immovable property shall be bound by the law of the place where the property is situated.
[19]Law of the People's Republic of China on Choice of Law for Foreign-related Civil Relationships (People’s Republic of China) Standing Committee of the National People’s Congress, 1 April 2011.
The GPCL Opinion elaborates on that particular article, stating:
(191) Where a foreigner dies within the territory of China, his property left within the territory of China shall be handled according to the Chinese law if no one inherits it or accepts bequeath, unless it is otherwise specified by the international conventions concluded or joined in by the two countries.[20]
[20]Notice of the Supreme People's Court on Issuing the Opinions on Several Issues concerning the Implementation of the General Principles of the Civil Law of the People's Republic of China (For Trial Implementation) (People’s Republic of China) Supreme People's Court, 2 April 1988 (amended 24 December 2008) [191].
Chinese succession law provides for two means of succession: Chapter II provides for statutory succession in cases where a person dies intestate and Chapter III provides for testamentary succession, including provisions dealing with the formality requirements for valid wills under Chinese law.
Pursuant to Article 2, succession may occur once a person dies. Pursuant to Article 5:
Succession shall, after its opening, be handled in accordance with the provisions of statutory succession; where a will exists, it shall be handled in accordance with testamentary succession or as legacy; where there is an agreement for legacy in return for support, the former shall be handled in accordance with the terms of the agreement.
As mentioned, Chapter III deals with the validity requirements of wills, Article 17 sets out the formality requirements for a valid will:
A notarial will is one made by a testator through a notary agency.[21]
A testator-written will is one made in the testator's own handwriting and signed by him, specifying the date of its making.
A will written on behalf of the testator shall be witnessed by two or more witnesses, of whom one writes the will, dates it and signs it along with the other witness or witnesses and with the testator.
A will made in the form of a sound-recording shall be witnessed by two or more witnesses.
A testator may, in an emergency situation, make a nuncupative will, which shall be witnessed by two or more witnesses. When the emergency situation is over and if the testator is able to make a will in writing or in the form of a sound-recording, the nuncupative will he has made shall be invalidated.
[21]The powers of notarial offices are provided for and regulated by the PRC Notary Law: Notary Law of the People's Republic of China (People’s Republic of China) Standing Committee of the National People’s Congress, 28 August 2005.
In cases of statutory succession, referred to as intestacy in the Victorian jurisdiction, the following articles deal with the different rights and particular categories of relations that may be enforced against an estate:
Article 9 –
Males and females are equal in their right to inheritance.
Article 10 -
The estate of the decedent shall be inherited in the following order:
First in order: Spouse, children, parents.
Second in order: Brothers and sisters, paternal grand-parents, maternal grand-parents.
When succession opens, the successor(s) first in order shall inherit to the exclusion of the successor(s) second in order. The successor(s) second in order shall inherit in default of any successor first in order.
The "children" referred to in this Law include legitimate children, illegitimate children and adopted children, as well as stepchildren who supported or were supported by the decedent.
The "parents" referred to in this Law include natural parents and adoptive parents, as well as step-parents who supported or were supported by the decedent.
The "brothers and sisters" referred to in this Law include blood brothers and sisters, brothers and sisters of half-blood, adopted brothers and sisters, as well as step-brothers and step-sisters who supported or were supported by the decedent.
The obvious potential for conflicts between relatives with equal entitlements to shares of an estate are dealt with in the following provisions:
Article 13 -
Successors same in order shall, in general, inherit in equal shares.
At the time of distributing the estate, due consideration shall be given to successors who are unable to work and have special financial difficulties.
At the time of distributing the estate, successors who have made the predominant contributions in maintaining the decedent or have lived with the decedent may be given a larger share.
At the time of distributing the estate, successors who had the ability and were in a position to maintain the decedent but failed to fulfil their duties shall be given no share or a smaller share of the estate.
Successors may take unequal shares if an agreement to that effect is reached among them.
Article 14 -
An appropriate share of the estate may be given to a person, other than a successor, who depended on the support of the decedent and who neither can work nor has a source of income, or to a person, other than a successor, who was largely responsible for supporting the decedent.
Article 15 -
Questions pertaining to succession should be dealt with through consultation by and among the successors in the spirit of mutual understanding and mutual accommodation, as well as of amity and unity. The time and mode for partitioning the estate and the shares shall be decided by the successors through consultation. If no agreement is reached through consultation, they may apply to a People's Mediation Committee for mediation or institute legal proceedings in a people's court.
Choice of law
In respect of the choice of law, personal connecting factors such as domicile, nationality and residence are key to determining applicable law for any legal proceeding. The deceased was an Australian citizen. It is not disputed that, at the date of his death, the deceased resided in China, nor is it disputed that the note came into existence in China. The key question in determining the applicable law is whether the deceased was domiciled in Victoria or in China.
Of particular relevance to the facts in this proceeding is the Conflicts Act and interpretive opinion, the first Chinese statute to deal specifically with conflict of law situations. Chapter IV of the Conflicts Act is titled inheritance and contains the following five articles:
Article 31 -
The laws at the habitual residence at the time of death of the deceased shall apply to legal inheritance, but the laws at the locality of the real estate shall apply to the legal inheritance of a real estate.
Article 32 -
A testament shall be confirmed as valid if its form conforms to the laws at the habitual residence, of the state of nationality or at the locality of the testamentary acts when the testament is made or at the time of death of the testator.
Article 33 -
The laws at the habitual residence or of the state of nationality when the testament is made or at the time of death of the testator shall apply to the validity of a testament.
Article 34 -
The laws at the locality of an estate shall apply to the administration of estates and related issues.
Article 35 -
The laws at the locality of an estate at the time of death of the deceased shall apply to the disposition of a vacant estate.
The Opinion provides that where the Conflict Act provisions cover situations canvassed in other laws, the Conflict Act, to the extent of its coverage, shall prevail:
Article 3 -
Where the Law on Choice of Law for Foreign-Related Civil Relationships and other laws have different provisions on applicable laws for the same foreign-related civil relationship, the Law on Choice of Law for Foreign-Related Civil Relationships shall prevail, except the Negotiable Instruments Law of the People's Republic of China, the Maritime Law of the People's Republic of China, the Civil Aviation Law of the People's Republic of China and other special provisions in laws and regulations on commercial field and in laws on intellectual property.
Where other laws instead of the Law on Choice of Law for Foreign-Related Civil Relationships have provisions on the relevant applicable law of any foreign-related civil relationship while the latter hasn't, such other laws shall prevail.
Consideration
Plaintiff’s application for a grant of representation in Victoria pursuant to s 9 of the Act
Without considering what the applicable law is, it is convenient to first deal with whether the note is a testamentary document that could be admitted to probate pursuant to s 9 of the Act given that the application was made for a grant of letters of administration with the will annexed.
The Court’s discretion to admit a document to probate notwithstanding the fact that it does not conform with the formalities in s 7 of the Act applies whether or not the document was created in Victoria. Three factors must be satisfied before the Court will admit an informal documents to probate:
(a) it must be a document;
(b) the document must purport to record the documentary intentions of the deceased; and
(c) the deceased must have intended that the relevant document be his or her will.
The note satisfies part of the test under s 9(1) of the Act, in that it is a ‘document’: it is a piece of paper that is marked with Chinese words that are capable of carrying a definite meaning as set out in the translation.[22]
[22]As defined in Interpretation of Legislation Act 1984, s 38.
Otherwise, the application raises the issues of whether the note is testamentary and whether it was intended by the deceased to be his will.
The manner and circumstances in which the deceased executes a document and the contents of that document are equally important in determining whether the document purports to record the deceased’s testamentary intentions. The difference between the deceased’s testamentary intentions and the intention that a specific document would constitute his or her will are explained as follows:
The cases indicate that, in making an application under s 9 of the Act, an applicant must put forward persuasive proof that the will was intended by the deceased to be his or her final will. It is not enough to show that a document sets out the deceased’s testamentary intentions or that it is consistent with other statements the deceased made about what he or she wanted to happen to his or her property after death. Rather the applicant must prove, on the balance of probabilities, that a deceased wanted that particular document to be his or her final will and did not want to make any changes to it.[23]
[23]Re Rosaro [2013] VSC 531 (4 October 2013) [36] (McMillan J).
What is required to satisfy the third element was also considered by Powell J in Re Springfield:
… the ultimate inquiry remains, whether the document itself, the circumstances regarding its contents … and other relevant circumstances … lead to the conclusion that the relevant deceased intended the subject document to constitute his will …
… while each case must depend upon its own facts, the greater the departure from compliance with the requirements of s 7 of the Act, the more difficult will it be for the court to be satisfied that the relevant deceased intended the subject document to be his will.
… where the subject document is either wholly written out, or, being on a will form, has been filled in, in the handwriting of the relevant deceased, and in cases where the subject document bears the signature of, or some mark made by, the relevant deceased indicating his intention to adopt it as his own, I would have little difficulty in finding myself satisfied that it was intended by the relevant deceased that the subject document should constitute his will. Where, however, the subject document was not seen, or read, or written, or in some way authenticated, or adopted, by the relevant deceased, or where the subject document, even if seen, or read, by the relevant deceased, was, in truth, no more than ‘instructions’, or a note of ‘instructions’, for a will … I would, I believe, find it very difficult, indeed, to find myself satisfied that it was intended by the relevant deceased that the subject document was intended to be his will.[24]
[24]Re Springfield (1991) 23 NSWLR 535, 539–540 (discussing the equivalent New South Wales provisions).
The plaintiff deposed that the deceased wrote and signed the note when he was in hospital. It was not made in the presence of the plaintiff or in the presence of any other person. His signature was not witnessed by any person and no evidence was placed before the Court that the handwriting was, in fact, that of the deceased. The plaintiff deposed that the deceased told her he had made the note, ‘in case something happens’.
Testamentary capacity requires that a testator is compos mentis, is aware of the extent of his assets, aware of those whom he seeks to benefit and aware of those who may have a claim on his bounty. Statements by the plaintiff that she expected that her son to make a full recovery when she saw him on 14 November are not sufficient to establish his testamentary capacity and the medical report provided by Dr Yan does not address the issue. Dr Yan’s report demonstrates that the deceased was extremely ill during the whole time he was in hospital, that he was not responding to treatment and had been suffering heart attacks on an almost daily basis since he was admitted to emergency. Assuming that the deceased wrote the note, there is no evidence as to his state of mind at that other than statements made by the plaintiff after the event, which are incapable of corroboration. The evidence does not establish to the requisite standard that the deceased had testamentary capacity as at 14 November 2014.
A testamentary document is an important document. It is a document that operates with legal effect in respect of the posthumous distribution of a testator’s property, as well as other administrative matters upon a testator’s death. A formal will, inter alia, appoints an executor or executors, may include wishes as to funeral or burial or other arrangements, purports to distribute all assets owned by a testator to beneficiaries, includes a residuary clause, is signed by the deceased and attested by witnesses.
However, the note purports to deal with less than one quarter of the total value of the deceased’s assets and it does not deal with all of his assets in Victoria. In Victoria, the deceased also owned a motor vehicle valued at approximately one quarter of the value of the combined total of the bank accounts. Importantly, it purports to benefit the plaintiff in circumstances where the plaintiff is the only person who has provided the evidence in the application. The note does not consider any other people who may have a claim on the deceased’s estate; namely, his father and his allegedly estranged wife. In addition, there is the possibility of the deceased being the father of Ms Fan’s child although the hearsay evidence of Ms Fan is that he did not know of the child’s existence.
The note also appears to express a wish that the plaintiff use the money in an unspecified bank account for her own purposes although when she may do so is unclear. Precatory documents do not evidence a will or a deceased’s testamentary intention and cannot be admitted to probate.[25]
[25]Re Estate of Wilson (1991) 24 NSWLR 334; Equity Trustees v Levin [2004] VSC 203 (26 May 2004).
On the balance of probabilities, I am satisfied that the note is not a document that the deceased intended to be his will. Accordingly, the plaintiff’s application for a grant of letters of administration pursuant to s 9 of the Act is dismissed.
Does Victorian or Chinese law apply to the plaintiff’s application?
Counsel for the plaintiff has also submitted that the note represents a donatio mortis causa under Victorian law[26] or that the will is validly executed under Chinese law and may be admitted to probate in Victoria pursuant to s 17(1)(a) or (b) of the Act. This is notwithstanding that no formal application pursuant to this section is made in the originating motion filed by the plaintiff. It is, however, convenient to consider these submissions for the purposes of finality.
[26]If this is the case, it would have the effect that the deceased died intestate and, under Victorian law, his wife would have the best claim to make an application for a grant of letters of administration in respect of herself and potentially the infant child: Administration and Probate Act 1958, ss 52(1)(a) and (f).
The central question that is determinative of the choice of law is the domicile of the deceased as the two other personal connecting factors, being Australian citizenship and residency in China are conflicting. A person’s domicile of origin is based on the jurisdiction in which they were born, alternatively, their citizenship. In this case, the deceased was originally from China but obtained Australian citizenship in 1997. However, he had been habitually residing in China from 2003 until the date of his death. Domicile of choice is established through lawful presence in a country combined with an intention to remain in that country indefinitely. Questions of intention are of decisive importance.[27]
[27]LK v Director-General, Department of Community Services (2009) 237 CLR 582, 599 [24] (French CJ, Gummow, Hayne, Heydon and Kiefel JJ).
Counsel for the plaintiff submitted that the deceased’s domicile was Victoria. The determination of a person’s domicile is concluded by reference to Victorian law, pursuant to s 4(4) of the Domicile Act 1978:
This Act has effect to the exclusion of the application of the laws of any other country relating to any matter dealt with by this Act.[28]
[28]In respect of nation states, the Commonwealth legislation contains a similar provision: Domicile Act 1982, s 3(5).
Pursuant to s 9 of the Domicile Act 1978, a domicile of choice is acquired upon the there being a coincidence of residence and the intention to make a home ‘indefinitely’:
The intention that a person must have in order to acquire a domicile of choice in a country is the intention to make his home indefinitely in that country.
According to the Macquarie Dictionary, the first ordinary meaning of ‘indefinite’ is:
1. Not definite; without fixed or specified limit; unlimited: an indefinite number.[29]
[29]Macquarie Dictionary (Macmillan Publishers Group Australia, 2009, 5th ed), 848.
It is peculiar that intention should play such a definitive role in the determination of such an important question. The complexity of the task of determination is observed by Isaacs J in Fremlin v Fremlin:
The intention is to be judged of upon all available testimony. Of this, conduct is the most important, because the most reliable. A man's own declarations are, of course, admissible in evidence, but, as laid down by the Privy Council in McMullen v. Wadsworth, the doctrine of the Roman law still holds good, that “It is not by naked assertion, but by deeds and acts, that a domicile is established.” Naked assertion without deeds and acts would be useless, and assertion inconsistent with deeds and acts is equally useless to control them.[30]
[30]Fremlin v Fremlin (1913) 16 CLR 212, 234 (citations omitted).
In Jamieson v Commissioner for Internal Revenue, Gzell J found an Australian citizen to have not relinquished their domicile of origin, being New South Wales, on the following facts:
The deceased lived in the United States for approximately six years before his death. On numerous occasions during that period, the deceased told Ms Jamieson that he intended to return to New South Wales to live. He never told Ms Jamieson that he intended to remain in the United States for the rest of his life. Two months before his death, the deceased applied for a job in New South Wales and attended an interview for the job in Melbourne. He was an unsuccessful applicant. Annually, the deceased returned to New South Wales for about four weeks to visit his mother and his children. The deceased held an Australian passport, last renewed in August 2003. His will stated his address to be in New South Wales and expressed the wish that his ashes be scattered in Sydney Harbour. The deceased retained real property and bank accounts in New South Wales. And he maintained in New South Wales Medibank Private health insurance, a New South Wales builder’s licence, a New South Wales driver’s licence, membership of NRMA and membership of the Terry Hills Golf Club.[31]
[31]Jamieson v Commissioner for Internal Revenue [2007] NSWSC 324, [13] (Gzell J).
Keeping Isaacs J’s admonitions in mind and notwithstanding the plaintiff’s self-serving and uncorroborated statements that she had spoken with her son about his intentions to one day move back to Australia, the evidence strongly suggests the contrary is the case. The vast majority of the deceased’s assets were held in China, the deceased lived in China, he worked in China and that is where the balance of his family also lived. He went to live in China because Ms Fan wanted to move there after they married in Melbourne. Even if it is accurate that they separated shortly after their marriage, the deceased chose to remain in China at that time, then subsequently moved within China for his work and did not return to Australia to live at any time. In stark contrast to the facts in Jamieson v Commissioner for Internal Revenue there is no evidence that the deceased evinced an intention to return to Victoria by maintaining significant connections to Victorian organisations or applying for jobs here. He did not divorce Ms Fan and she has recorded his name on the birth certificate of her child.
There is no doubt that the deceased was an Australia citizen but his domicile of choice and habitual residence was undoubtedly China. This is reinforced by the fact that the note was also executed in China.[32] Consequently, as the deceased’s habitual residence and domicile was China, the validity of the note must be determined under Chinese law.[33] In my view, the forum for dealing with the validity of the note is China, with Chinese laws determining the distribution of the estate of the deceased, both in China and Australia.
[32]Ibid s 17(a).
[33]Wills Act 1997, s 17(b).
It is possible that the note does comply with the internal law of China as one of the formal requirements for a will is: ‘A testator-written will is one made in the testator's own handwriting and signed by him, specifying the date of its making.’ However, no expert evidence was adduced on this point and, from a common law perspective, it would be unusual that a document purporting to deal only with approximately one quarter of a deceased’s assets located in another jurisdiction would be considered a will. Further, evidence as to testamentary capacity would have to be adduced and this too is governed by the law of the deceased’s domicile. In any case, without expert evidence on these issues, the Court is not able to conclude the appropriate principles of Chinese law to be applied in this regard. Therefore, the plaintiff’s submission that the note ought be admitted to probate by virtue of the fact that it was validly executed under Chinese law has no force.
Assuming that, in line with Victorian law, the note does not constitute a will under Chinese law, the deceased’s estate would be distributed according to the intestacy provisions under Chinese law. The deceased’s assets at the date of his death in China and Australia comprised movable property, namely, cash and securities in various accounts, a wristwatch in China and a motor vehicle in Australia, presently used by the plaintiff. Almost three quarters of the value of the estate of the deceased is located in China. Being movable property, his assets are subject to an ancient distinction in law found at common law and in Chinese statutes alike owing to a shared ancestor in ancient Roman law.[34] The learned authors of Nygh’s Conflict of Laws in Australia articulate the distinction, with regards to intestate succession, in the following terms:
It has been trite law, at least since Pipon v Pipon, that the succession to movable property on intestacy is determined by the law of the domicile of the intestate at the time of death.[35]
[34]Pipon v Pipon 1 (1744) Ambler 25; 27 E.R. 14. See also, Re estate of late Melegh [2016] NSWSC 249 (22 February 2016) [8] (Slattery J).
[35]M Davies, A S Bell, P L G Brereton (eds) Nygh’s Conflict of Laws in Australia (LexisNexis Butterworths, 2014, 9th edn) [38.4] (Citations omitted).
Accordingly, on this basis and in accordance with the conclusion that the deceased was domiciled in China, it is readily apparent that Victoria is not the appropriate forum to determine issues of succession and inheritance in respect of the estate of the deceased.[36]
Does the note constitute a donatio mortis causa?
[36]Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538.
In the alternative, counsel submitted that the note constitutes a donatio mortis causa, or deathbed gift, to the plaintiff. As stated, the plaintiff’s application for a grant of representation in Victoria does not include any reference to a deathbed gift. In Victoria, a claim that the note constitutes a donatio mortis causa encompasses the law of personal property, equity and the law of succession, although such a gift is strictly not testamentary in character and does not require a grant of representation for it to take effect. Such an application would ordinarily be made in a separate application in the equity jurisdiction of the Court seeking orders or declarations that the note constitutes a death bed gift. Notwithstanding this, it is convenient to consider the submissions made by the plaintiff.[37]
[37]For the purpose of this issue, although the plaintiff made no formal application, for convenience, she will be referred to as the plaintiff.
Inter vivos assignments or gifts of property that constitute a donation mortis causa are usually governed by the lex situs or the jurisdiction in which the asset is located.[38]
[38]Anning v Anning (1907) 4 CLR 1049. See also, Re Korvine’s Trusts [1921] 1 Ch 343; Re Craven’s Estate (No 1) [1937] Ch 423.
Counsel cited the legal test for such a gift as quoted in a decision by White J of the New South Wales Supreme Court in Hobbes v NSW Trustee and Guardian.[39] It was submitted that the application of the legal test, as cited in that case to the facts of the case at hand, made a donatio mortis causa of the bank accounts referred to in the note.
[39]Hobbes v NSW Trustee & Guardian [2014] NSWSC 570 (14 May 2014).
The modern doctrine of donatio mortis causa first appears in reported cases at the beginning of the eighteenth century and has since been continually developed and expanded.[40]
[40]Andrew Borkowski, Deathbed Gifts: The Law of Donatio Mortis Causa (Blackstone Press, 1991) 9-23.
In the decision of Public Trustee v Bussell,[41] Cohen J restated the legal test for a valid donatio in the following terms:
(1) the gift must be made in contemplation of the donor's death, although not necessarily in expectation of death; (2) there must be delivery of the subject matter of the gift to the donee or a transfer of the means or part of the means of getting at the property, or, as has been said, the essential indicia of title; and (3) the gift must be conditional upon it taking effect on the death of the donor, being revocable until that event occurs…[42]
[41](1993) 30 NSWLR 111.
[42]Public Trustee v Bussell (1993) 30 NSWLR 111, 115 quoted in Hobbes v NSW Trustee & Guardian [2014] NSWSC 570, [22].
Two difficulties arise in the application of the test in this instance, the first is whether delivery was effected by the note sufficient to perfect the gift, the second, a question of fact that acts upon the first difficulty, is an evidentiary burden. The paucity of evidence frustrates the discharging of that evidentiary burden.
As is commonplace in such cases, it is the plaintiff’s uncorroborated evidence that is the evidentiary basis for finding a valid donatio. It has been accepted that, in principle, this obstacle is not insurmountable in affirming the truth of the plaintiff’s version of events.[43]
[43]See Hobbes v NSW Trustee & Guardian [2014] NSWSC 570, [15] quoting Cosnahan v Grice (1862) 15 Moo PC 215, 223; 15 ER 476, 479
Taken at its highest, but with the notable caution that the plaintiff’s evidence is unable to be corroborated, there is some basis for finding that two of the three elements of a valid donatio mortis causa may have been met, that is, the deceased wrote the note in contemplation of his death, satisfying the first element, and that the gift was only intended to become absolute upon his death, meeting the third element. The principal difficulty is the second criterion, the delivery of the subject matter.
What is required to effect delivery of an intangible object, such as the contents of a bank account, has been addressed by Lord Hardwicke in a 1752 decision that identified the potential for a valid donatio to circumvent the protections that the statute of frauds sought to implement with respect to nuncupative wills, stating:
Here is then a revocation of a will by words only; vis. “this is yours when “I Die.” All these clauses therefore will be overturned, if such evidence is admitted. But it is said, if this is not allowed, it will be impossible to make a donation mortis causa of stock or annuities, because in their nature they are not capable of actual delivery. I am of opinion, it cannot without a transfer, or something amounting to that…[44]
[44]Ward v Turner 2 Ves Sen 431, 444 (20 July 1752) (Lord Harwicke L.C.)
What can ‘amount to that’ is a question of fact to be determined on a case by case basis, with Lord Evershed MR in Birch v Treasury Solicitor[45] restating the principle in the following terms:
The question then is: Where actual transfer does not or cannot take place, what will “amount to that”? As a matter of principle, delivery of the indicia of title (viz., the document or thing the possession or production of which entitles the possessor to the money or property purported to be given), as distinct from mere evidence of title, should satisfy Lord Hardwicke’s condition.[46]
[45]Birch v Treasury Solicitor [1951] Ch 298, [1950] 2 All ER 1198 (23 December 1950) (Sir Raymond Evershed MR) (‘Birch’).
[46]Birch [1951] Ch 298, [1950] 2 All ER 1198, 1205.
In Hobbes v NSW Trustee & Guardian,[47] White J helpfully summarises the rich case law on donatio mortis causa. In that case, a woman who had become acquainted with an elderly man in hospital whilst visiting her own father, and whom subsequently cared for that man in his last years, was given a donatio of moneys held in a passbook account and fixed term investment account and real property. The deceased had no close relatives or friends in Australia and so it was the NSW Trustee & Guardian that defended the claim.
[47]Hobbes v NSW Trustee & Guardian [2014] NSWSC 570 (White J) (14 May 2014) (‘Hobbes’).
White J found that the real property was not appropriate subject matter for a donatio mortis causa but that the deposit moneys were valid deathbed gifts. In regard to the passbook, White J found that it was on ‘all fours’ with Birch being an ‘essential indicium of title to the money in the bank account to which the passbook related’.[48] With respect to the term deposit, White J expressed real difficulty in distinguishing between ‘ “essential indicia of title” as distinct from “mere evidence of title” in relation to a chose in action that is not required to be evidenced in writing, and for which the writing could therefore not be truly essential to recovery of the debt’.[49] Nevertheless, White J was able to find satisfactory delivery of the gift, notwithstanding that production of the document was not necessarily required to withdraw the moneys.
[48]Ibid [50].
[49]Ibid [52].
The ‘account bankbooks’ referred to in the note were not in evidence although the note suggests they are in the plaintiff’s possession. Without an opportunity to examine them it is impossible to conclude whether the ‘real test’ of ‘whether the instrument handed over is the essential indicia or evidence of title, possession or production of which entitles the possessor to the money or property purported to be given, so that delivery “amounts to a transfer”’[50] has been met. Notably, and in addition, the deceased did not disclose the pin number for either of the accounts at the time the plaintiff deposed that he spoke about the note or at any other time. Whilst he may not have wanted to verbalise the pin number for fear of being overheard as asserted by the plaintiff, he could have written down the pin number on the note or on another piece of paper. The failure to do so is another indication that delivery was not effected so as to give rise to a donatio mortis causa.
[50]Birch [1951] Ch 298, [1950] 2 All ER 1198, 1207. See also J D Heydon et al, Meagher, Gummow & Lehane’s Equity: Doctrines and Remedies (LexisNexis Butterworths, 5th ed, 2015) 1012 [31-045] for discussion of doctrine as applied to bank deposit account books.
Conclusion
For these reasons, the plaintiff’s submission that the note constitutes a donatio mortis causa cannot succeed.
Orders
I will order that the plaintiff’s application for a grant of letters of administration with the will annexed be dismissed.
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