Rojtarowski v Rojtarowski & Ors
[2009] VSC 15
•20 January 2009 (Date of Ruling: 16 and 20 January 2009)
| IN THE SUPREME COURT OF VICTORIA | Not Restricted | |
AT MELBOURNE
PRACTICE COURT
No. 10460 of 2008 and
No. 6354 of 2008
| BOHDAN ROJTAROWSKI (who sues in his capacity as Administrator of the Estate of VINCENZA ROJTAROWSKI, deceased) | Plaintiff |
| v | |
| NADIA-LEE ROJTAROWSKI and ors | Defendants |
and
| NADIA-LEE ROJTAROWSKI and MARK BOHDAN ROJTAROWSKI | Plaintiffs |
| v | |
| BOHDAN ROJTAROWSKI (who is sued as Administrator of the Estate of VINCENZA ROJTAROWSKI, deceased) | Defendant |
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JUDGE: | BONGIORNO J | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 13 and 16 January 2009 | |
DATE OF RULING: | 16 and 20 January 2009 | |
CASE MAY BE CITED AS: | Rojtarowski v Rojtarowski | |
MEDIUM NEUTRAL CITATION: | [2009] VSC 15 | |
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TRANSFER OF LAND ACT 1958 – Caveats – interest necessary to support a caveat – intestate estate – constructive trust – effect of statements of deceased as described in caveator’s affidavit – onus on caveator to show caveatable interest – onus not discharged –balance of convenience favours removal – removal of caveat pursuant to sub-s 90(3).
ADMINISTRATION AND PROBATE ACT 1958 – Part IV application – application for an interlocutory injunction to prevent sale of property in dispute – application refused.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr S. Wilmoth | Oakley Thompson & Co |
| For the Defendant | Mr M. Hines | Robert Clements, Solicitor |
HIS HONOUR:
This matter concerns two related proceedings currently pending in this court: number 6354 of 2008, in which Nadia‑Lee Rojtarowski and Mark Bohdan Rojtarowski make a claim under Part IV of the Administration and Probate Act1958 that further provision be made for them out of the intestate estate of their late mother Vincenza Rojtarowski; and 10460 of 2008, in which the administrator of Vincenza Rojtarowski’s estate seeks the removal of a caveat lodged by Nadia‑Lee Rojtarowski and Mark Bohdan Rojtarowski in respect of the title to a block of vacant land at Venus Bay, which forms part of the estate of Vincenza Rojtarowski.
It is convenient to deal with the removal of caveat application first, and then with the interlocutory relief sought in the Part IV proceeding.
The application for removal of the caveat
The caveatable interest claimed by the caveators in the Venus Bay land is expressed to be (after having been substantially and significantly amended on 4 December 2008) “an estate in fee simple. The land is held upon a resulting implied or constructive trust created by Vincenza Rojtarowski.”
The administrator of the estate of Vincenza Rojtarowski applies, pursuant to
sub-s 90(3) the Transfer of Land Act 1958, for the removal of that caveat on the ground that the caveators do not have the interest they claim or indeed any interest in the Venus Bay land.
Bohdan Rojtarowski is the administrator of Vincenza Rojtarowski’s estate. He was her husband at the time of her death. At the time of her death on 4 July 2007, he had been estranged from Vincenza Rojtarowski for many years — since 1995. Consent orders effecting a division of their matrimonial property were subsequently made by the Family Court of Australia, such orders being expressed to determine finally all such matters between them.
Mr and Mrs Rojtarowski had three children, Mark Bohdan Rojtarowski, Matthew Ivan Rojtarowski and Nadia‑Lee Theresa Rojtarowski who are now all sui juris being 27, 25 and 24 respectively. Only the first and third of these children claim a caveatable interest in the Venus Bay land or make a claim pursuant to Part IV of the Administration and Probate Act1958 in respect of their mother’s estate.
Letters of administration were granted to Bohdan Rojtarowski on 2 April 2008. The estate consisted then of a house and land at Dandenong, which the administrator valued at $310,000, a vacant block of land at Venus Bay, which he valued at $100,000, a Toyota motor vehicle valued at $30,000, accounts with the Commonwealth Bank totalling something over $900 and personal chattels worth about $1,500.
On an application such as that with which the Court is currently concerned, the onus of proving a caveatable interest, and thus justifying the caveat, rests on the caveator; in this case, Nadia‑Lee Rojtarowski and Mark Bohdan Rojtarowski.
The nature of the application was conveniently described by Dodds‑Streeton J in Goldstraw v Goldstraw.[1] Her Honour described the jurisdiction under s 90(3) in these terms:
Section 90(3) is in the nature of a summary procedure analogous to the determination of interlocutory injunctions. The Court’s power under s 90(3) is discretionary. In that context it is recognised that the caveator bears the onus of establishing that there is a serious question to be tried that he or she does have the estate or interest in the land claimed. That is, ‘in order to resist successfully the application for removal of caveat (the caveator’s) arguments must be directed towards the assertion of an interest in the subject land in the light of relevant principles of property and equity law.’[2]
Further, if the caveator does establish the serious question to be tried in relation to the estate or interest claimed, the weight of authority indicates that the caveator must further establish that the balance of convenience favours the maintenance of the caveat until trial.[3]
“Until trial”, in this context, means until the trial of a proceeding which would determine the rights between the parties finally.
[1][2002] VSC 491 (Unreported, Dodds-Streeton J, 14 November 2002).
[2]McMahon v McMahon [1979] VR 239, 243.
[3][2002] VSC 491 (Unreported, Dodds-Streeton J, 14 November 2002) [30].
After argument in this case was completed, counsel for the caveators, Mr Hines, with the consent of Mr Wilmoth for the plaintiff, drew the Court’s attention to the West Australian decision of Murray J, Optel Pty Ltd v National Companies and Securities Commission,[4] where His Honour made observations concerning the onus of proof in a caveat removal case involving legislation similar to sub-s 90(3), where the parties seeking the removal were other than the registered proprietor or, as here, entitled to be the registered proprietor. Murray J contrasted such a case with the case he was there dealing with. He held that where the person seeking removal is not the registered proprietor, but merely a person wishing to take a transfer of the land, the onus of demonstrating that the caveat was not maintainable would rest on the challenger to its validity. He referred to Eng Mee Yong v Letchumanan,[5] a House of Lords decision, Lewenberg & Pryles v Direct Acceptance Corporation Ltd,[6] and Re Jorss’ caveat.[7]
[4](1990) 2 ACSR 493.
[5][1980] AC 331.
[6][1981] VR 344.
[7][1982] Qd R 458.
Murray J’s reasoning in Optel does not assist in the resolution of this case. This is because the person seeking the removal here is entitled to be registered as the proprietor. He is not merely taking under a transfer.
The caveator’s case rested upon evidence contained partly in affidavits filed in their Part IV application, proceeding number 6345 of 2008, supplemented by affidavits sworn more recently in the caveat proceeding. Nadia‑Lee Rojtarowski swore an affidavit in the Part IV proceeding on 22 July 2008. The affidavit, which was lengthy, was concerned mainly with the unhappy relationship which existed for many years between her father and mother, her mother’s last illness and death, and various associated matters.
Counsel for her and her brother referred to paragraphs 38 and 39 of this affidavit which are in the following terms:
[38] Late one night at the end of June 2007 while we were sharing a packet of Tim Tams, my mother said that she wanted “You kids to have thirds” of her estate. I replied that I understood this and that there was no need to talk about her will. She replied “No, listen, Lee, I want you kids to know that this all belongs to you three children”.
[39] The afternoon before my mother died I made telephone calls from Berwick Hospital about my mother making a will including to a solicitor about how she could make a will there and then. I told my father, who was also by then at the hospital, about this. He replied that I should not worry about doing a will and that he would carry out my mother’s wishes and divide her estate equally between her children.
These paragraphs were referred to in paragraph 7 of an affidavit filed in this proceeding in which Ms Rojtarowski said that her father’s statement persuaded her not to encourage her mother to make a will. She said she believed that if she had encouraged her mother to do so, she would have made a will leaving all her estate to her three children. She said she believed that her father said that her mother’s estate would be divided between the children to persuade her not to encourage her mother to make a will.
Mr Hines submitted that these facts gave rise to a promissory estoppel which had the effect of conferring a caveatable interest in the Venus Bay land on Vincenza Rojtarowski’s three children. He described that interest as a right akin to a right of pre-emption, that is to say that they enjoyed a right of first refusal had their mother’s legal personal representative chosen to sell the Venus Bay property in the course of administration of her intestate estate.
As would be expected, the factual circumstances deposed to by Ms Rojtarowski have not gone unchallenged and there are many unresolved objections to the evidence proffered by her and her brother. Mr Hines put an argument that the Court should accept the version contended for by his clients because of matters which, he said, reflected adversely on the credit of the administrator. However, ultimately, he conceded that the resolution of disputed questions of fact must await a trial of the Part IV proceeding.
However, even if the validity of the caveators’ case is examined on a view of the facts most favourable to them, and regarding all their affidavits as being fully admissible, it cannot succeed. It is essential to the creation of a trust, which it is argued the caveators are entitled to here, that there be sufficient certainty as to the subject matter of the trust to enable it to be enforced by a court of equity.[8]
[8]See JD Heydon and MJ Leeming, Jacobs’ Law of Trusts in Australia (7th ed, 2006) [523] and following.
In this case, even if one assumes that there is a promissory estoppel arising from the administrator’s conduct and representations made to his daughter prior to the deceased’s death and before the deceased’s estate was vested in him, there was no certainty whatsoever as to what obligation would be imposed upon him as a trustee with respect to the deceased’s estate and hence the subject of the alleged trust.
The caveators’ case appears to proceed on the basis that if Ms Rojtarowski had encouraged her mother to make a will, by that will she would have devised the Venus Bay land to Ms Rojtarowski and her brother in specie, but such a conclusion is no more than speculation. Whether the mother would have responded positively to such encouragement is no more than speculation itself and more importantly, how she would have responded is even more speculative. The only evidence of the mother’s wish, assuming for present purposes the conversations deposed to in paragraphs 38 and 39 of Ms Rojtarowski’s affidavit of 27 July are admissible, establish that “You kids [are] to have thirds” or that “This all belongs to you three children.” How these expressions would have been translated into a testamentary bequest or devise is completely unknown. Would Venus Bay have been devised to the three children in specie as tenants in common or as joint tenants, or more likely would Vincenza Rojtarowski have simply left her entire estate to the three children equally?
The answer to this question would be determinative of this application.
Even if the administrator could be compelled to forego his entitlement on intestacy because of his earlier conduct, there is no warrant for compelling him to hold the Venus Bay property in specie for the three children, such that any of them could be said to have an interest in it sufficient to support a caveat. In any event, what of the rights of the third child who is not a party to this proceeding or the other proceeding?
The interest claimed by the caveators here is, in any event, not an interest arising in equity as a result of a promise made by their father, but rather a trust created by their mother. There is no evidence whatsoever of such a trust. In the circumstances there is no justification for permitting the caveat over the Venus Bay land to remain.
Further, the balance of convenience strongly favours the caveat being removed. Upon obtaining a grant of administration, the caveators’ father, the estranged husband and widower of the deceased, became seised of the Venus Bay land upon a statutory trust for sale by virtue of s 38 of the Administration and Probate Act 1958. He has in fact sold the land pursuant to his power to do so, settlement of which sale is due next Monday, 19 January. The caveat currently prevents such settlement. There is no reason why such settlement should no go ahead. The failure to settle on Monday would make the deceased’s estate liable to a suit for specific performance at the instance of the purchaser. There is no reason why it should be put in such jeopardy.
The caveat presently affecting the Venus Bay land will be removed.
The application for an interlocutory injunction
The claim by Nadia‑Lee Rojtarowski and her brother for an interlocutory injunction, in proceeding number 10460 of 2008, can be disposed of more briefly. It depends upon the plaintiffs establishing an arguable case, or a serious question to be tried, as to whether they would be likely to obtain an order pursuant to Part IV of the Administration and Probate Act 1958, which would have the effect of transferring the Venus Bay land to them (and, quaerae, their brother), in specie.
The injunction they seek would prevent the contract of sale of that land already referred to from being settled on Monday.
The jurisdiction of the Court to vary the statutory distribution of a deceased estate on intestacy depends upon proof by the applicants that the intestacy provisions of the Administration and Probate Act 1958 do not result in adequate provision for their proper maintenance and support out of the deceased’s estate. It is not a jurisdiction which is concerned with an investigation into the wishes of the deceased, as much of the affidavit material filed in this case appears to assume. Nor is it a jurisdiction which can be called in aid of a distribution of a deceased estate in specie where the applicant seeks such distribution, not because of a need for maintenance or support, but because of a desire to put into effect the non-testamentary wishes of the deceased.
The law provides a mechanism for the devolution of property in specie. That is by will. That is not the situation here.
In Vigolo v Bostin,[9] the High Court restated the principles which must guide the Court in applying Part IV. None of those principles would support an order which would require the provision in specie of a particular asset of an estate to a particular beneficiary on an intestacy. Thus the preservation of an asset in specie by injunction, pending the determination of a Part IV application, would be a very rare thing indeed. Indeed I wonder if it would ever be appropriate.
[9](2005) 221 CLR 191.
Allegations against the administrator that he may have sold the Venus Bay property at an undervalue, or have been otherwise in breach of his duties, can be aired in an appropriate proceeding if necessary, but they are not relevant here. Otherwise the administrator must continue to administer the estate of the deceased, subject of course to his removal by the Court (as the plaintiffs now seek) according to law.
The application for an interlocutory injunction to prevent the transfer of the Venus Bay property to its purchaser is also refused.
Costs
Ordinarily the plaintiff administrator’s costs should follow the event and be recoverable from the unsuccessful caveators. However, Mr Hines for the caveators submitted an extensive argument to the effect that the ordinary rules should not apply in this case. The argument is directed towards establishing that the caveators acted reasonably in lodging the caveat in the circumstances, and should therefore not only not pay costs to the estate, but should also have their costs out of the estate. He argued that the question raised by the caveat needed to be decided for due administration of the estate.
The Court has held that the caveat was unsustainable. Indeed Mr Hines never argued that it was sustainable in the form in which it was originally lodged, nor in the form in which it still appeared at the date of the hearing. Had he been able to demonstrate a caveatable interest at all, it would have been necessary to amend the caveat again to ensure protection of that interest, if such amendment could in fact be effected.[10]
[10]See Midwarren Estates Pty Ltd v Retek [1975] VR 575 (Menhennitt J).
In the circumstances, there is no reason why costs should not follow the event. The defendants will be ordered to pay the plaintiff’s costs of proceeding number 10460 of 2008, to be taxed. However, having regard to the defendants’ interest in the deceased estate, it is appropriate that there be a stay in respect of that costs order until proceeding number 6304 of 2008 is finalised.
I turn to the costs question concerning the failed application for an interlocutory injunction. Here again the plaintiffs failed because their application was misconceived. Their claim under Part IV of the Administration and Probate Act 1958 is a claim for further provision from the estate of the deceased because the intestacy provisions of that Act do not provide adequate provision for them out of the deceased’s estate. Such provision, if they are successful, will be provided by adjustment of the portions into which the estate will be divided before distribution.
Mr Hines submitted that the Part IV proceeding will result in his clients, and presumably also their brother, receiving the whole estate. No matter how unlikely that result might be in reality, it is at least a theoretical possibility.
In the circumstances it is more appropriate that the question of costs of the interlocutory injunction application be determined by the trial judge hearing the Part IV proceeding, after the trial of that proceeding. Accordingly the question of costs of the interlocutory injunction application will be reserved to the trial judge in proceeding number 6304 of 2008.
Finally, Mr Hines submitted that the question of whether the administrator should be entitled to an indemnity for his costs from the estate should be reserved to the trial judge. Having regard to the sworn evidence of conduct by the administrator that might lead to an adverse finding against him, which in turn would merit his being deprived of his costs from the estate, there is much to commend Mr Hines’ submission. The question of the administrator’s right to his costs of the Part IV proceeding to date from the estate will be reserved to the trial judge.
Orders
In proceeding number 10460 of 2008, the Court orders that:
1. This proceeding together with No. 6354 of 2008 be referred immediately to the Associate Judge concerned with listing for listing and determination with expedition.
2. The first- and second-named defendants pay the plaintiff’s costs of the application to remove the caveat, such costs to be taxed.
3. The order in paragraph 2 be stayed until the determination of proceeding No. 6354 of 2008 in this Court by the making of final orders therein.
In proceeding number 6354 of 2008, the Court orders that:
1. The plaintiffs’ application for injunctions is refused.
2. The plaintiffs have leave to amend the Originating Motion by adding to the statement of Relief or Remedy Sought further paragraphs as follows:
“5. Pursuant to section 34 of the Administration and Probate Act 1958, an order that the defendant be removed as administrator of the Estate of Vincenza Rojtarowski, deceased and that Nadia Liana Pleban be appointed as administrator in his place.
6. Pursuant to section 37 of the Supreme Court Act 1986 and the Court’s inherent jurisdiction, an order that the defendant Bohdan Rojtarowski whether by himself his servants or agents be restrained from attempting to evict the plaintiff Nadia-Lee Rojtarowski from or sell the land known as 85 Illawarra Crescent, North Dandenong, or attempting to take possession of or sell or agree to sell the Toyota Rav 4 2005 model motor vehicle Registration No TNQ-449.
7. Orders that pursuant to Rule 6.03 of the Supreme Court (Administration and Probate) Rules 2004, the defendant file a true and just account in Form 3-6AA, verified by affidavit, of the administration of the estate and that the defendant furnish an account of the property, capital and income of the estate and of the dealings of the defendant whether by himself his servants or agents therewith.
8. A declaration that the defendant is not entitled to any interest in or proceeds of the estate.”
3. This proceeding together with No. 10460 of 2008 be referred immediately to the Associate Judge concerned with listing for listing and determination with expedition.
4. The costs of the application for interlocutory injunctions are reserved for the determination of the Trial Judge.
5. The question of the defendant’s as Administrator of the estate right to his costs from the estate is reserved for the determination of the Trial Judge.
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