Subject to allowing the parties an opportunity to make submissions about the form of orders to be made and orders for costs:
(1) The Will of the deceased is to be rectified to insert the name of the plaintiff as beneficiary of the property known as “Boronga”.
(2) A grant of administration of the estate of the deceased, with the Will as rectified annexed, is to be made to the plaintiff.
(3) Having actively participated in breaches of fiduciary obligations owed to the deceased by the first defendant (as an enduring attorney of the deceased, consequent upon her unauthorised transfer of “Boronga” to them for no consideration) the second, third, fourth and fifth defendants hold “Boronga” on trust for the estate of the deceased.
(4) Conditional upon their re-conveyance of “Boronga” to the estate of the deceased, family provision relief, in the form of differential legacies charged on “Boronga”, is to be granted to each of the second, third, fourth and fifth defendants.
(5) As agreed between the plaintiff and the second, third, fourth and fifth defendants, the partnership between them known as “the Shadrack Partnership” is to be dissolved by an order of the Court and any disputes between the partners upon the taking of partnership accounts are to be determined by arbitration in accordance with the partnership deed.
(6) Upon an assumption that “Boronga” is re-conveyed to the estate of the deceased, no more than nominal awards of compensation are to be made against the first defendant (for breach of fiduciary obligations owed by her to the deceased) or the sixth defendant (for breach of a common law duty of care owed by him to the plaintiff).
Catchwords:
SUCCESSION - Administration of Estates – Probate – Rectification of Will – Will prepared by solicitor – Clerical error, and failure to give effect to testator’s instructions, in will preparation – Accidental omission of name of beneficiary – Rectification granted.
PRINCIPAL AND AGENT – Power of attorney – Enduring appointment – Attorney not authorised to benefit from exercise of power – Power to make gifts of principal’s property to third parties – Exercise of power qualified by fiduciary obligations owed by attorney to principal, and obligation not to commit fraud on power – Attorney not entitled to divest principal of substantial asset for her own purposes and without benefit to principal.
EQUITY – Fiduciary obligations – Breach by fiduciary’s transfer of principal’s property to third parties – Active participation by third parties in fiduciary’s breach – Obligation of fiduciary to restore estate of principal – Accessorial liability of third parties, to return property to principal – Property held on trust for estate of deceased principal.
SUCCESSION – Ademption – Inter vivos alienation of property of incapacitated principal by enduring attorney acting,…
Grounds of appeal
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
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AGLC
Reilly v Reilly [2017] NSWSC 1419
Case
[2017] NSWSC 1419
Decision Date
CaseChat Overview and Summary
The case of Reilly v Reilly involved a dispute over the estate of a deceased farmer, Reilly, and the administration of his will. The primary issue was whether a will prepared by a solicitor, which contained a clerical error and omitted a beneficiary's name, could be rectified. Additionally, the case addressed the misuse of an enduring power of attorney by the deceased's daughter, who transferred the principal's property to third parties without authority. The court had to determine the extent of the fiduciary obligations owed by the attorney to the principal, and whether the attorney could benefit from the exercise of the power of attorney. The case also explored the principles of succession law, particularly the doctrine of ademption, and whether the inter vivos alienation of the principal's property by the attorney without authority resulted in the ademption of the principal's testamentary gift of the property.
The court was required to decide whether the will could be rectified to include the omitted beneficiary's name, given the clerical error in its preparation. It also needed to examine the attorney's actions and determine if they were in breach of the fiduciary obligations owed to the principal. Furthermore, the court had to consider the legal implications of the property transfer to third parties and whether the property remained beneficially entitled to the deceased principal's estate. The court also had to address the issue of succession and the applicability of the doctrine of ademption in the context of the inter vivos alienation of the principal's property by the attorney. Finally, the court had to assess the claims of the disappointed beneficiary against the enduring attorney and the solicitors who were retained by the attorney to facilitate the inter vivos transfer.
The court held that the will could be rectified to include the omitted beneficiary's name, as the error was a clerical one and did not reflect the deceased's true intentions. The court found that the attorney's transfer of the principal's property to third parties was in breach of her fiduciary obligations and without benefit to the principal. The property was held on trust for the principal's estate, and the estate remained beneficially entitled to the property, which was not subject to ademption. The court granted relief to the adult daughters of the deceased conditionally upon the restoration of the property to the deceased estate. The court also held that the enduring attorney was not entitled to benefit from the exercise of her power of attorney, and any transfer of the principal's property to third parties without authority would be void. Finally, the court found that the solicitors who were retained by the attorney owed a duty of care to the disappointed beneficiary of the deceased principal, and the beneficiary could bring an action for damages against the solicitors.
The court ordered that the will be rectified to include the omitted beneficiary's name. It also directed that the property transferred by the attorney to third parties be restored to the deceased estate. The court granted relief to the daughters of the deceased, subject to the restoration of the property to the estate. The court further held that the enduring attorney was not entitled to benefit from the exercise of her power of attorney and that any transfer of the principal's property to third parties without authority would be void. The court found that the solicitors who were retained by the attorney owed a duty of care to the disappointed beneficiary, and the beneficiary could bring an action for damages against the solicitors.