Sammut v Kleemann
[2012] NSWSC 1030
•05 September 2012
Supreme Court
New South Wales
Medium Neutral Citation: Sammut v Kleemann [2012] NSWSC 1030 Hearing dates: 27 August 2012 Decision date: 05 September 2012 Jurisdiction: Equity Division Before: Hallen AsJ Decision: (i) Having found that the Plaintiff, Richard Anthony Sammut, is an eligible person, that there are factors which warrant the making of his application and that the provision made for him in the Will of the deceased is inadequate for his proper maintenance or advancement in life, order that he is to receive a lump sum of $96,500 out of the estate of the deceased.
(ii) Order that the burden of the provision made for the Plaintiff, should be borne out of the residuary estate of the deceased by the Defendants equally.
(iii) Order that no interest is to be paid on the lump sum if that lump sum is paid within 14 days of the making of these orders; otherwise, interest calculated at the rate prescribed by s 84A(3) Probate and Administration Act 1898, on unpaid legacies, is to be paid from that date until the date of payment.
(iv) Order that the costs of all parties shall be determined after further submissions, unless agreement is reached between them.
(v) Order that the Exhibits should be dealt with in accordance with the Uniform Civil Procedure Rules 2005 following the determination of the costs of the proceedings.
(vi) Further consideration with respect to orders for the purpose of giving effect to the family provision order made in favour of the Plaintiff be reserved.
(vii) Stand the matter over to a convenient date to the parties and the court for any argument as to costs.
Catchwords: SUCCESSION - FAMILY PROVISION - The Plaintiff, a grandchild of the deceased, applies for a family provision order under Chapter 3 of the Succession Act 2006 - The Defendants are son and daughter-in-law of the deceased, to whom Probate of the deceased's Will was granted and to whom the whole estate was left in equal shares - Whether Plaintiff is an eligible person - Whether there are factors which warrant the making of his application - and, if so, whether adequate and proper provision not made in Will of the deceased for the Plaintiff. Legislation Cited: Civil Liability Act 2002
Family Provision Act 1982
Probate and Administration Act 1898
Property (Relationships) Act 1984
Succession Act 2006
Succession Amendment (Family Provision) Act 2008
Uniform Civil Procedure Rules 2005Cases Cited: Alexander v Jansson [2010] NSWCA 176
Allardice, In re, Allardice v Allardice (1909) 29 NZLR 959
Allen (deceased), Re; Allen v Manchester [1922] NZLR 218
Amaca Pty Ltd v Novek [2009] NSWCA 50
Anderson v Teboneras [1990] VicRp 47; [1990] VR 527
Bartlett v Coomber [2008] NSWCA 100
Bosch v Perpetual Trustee Co Ltd [1938] AC 463
Bowditch v NSW Trustee and Guardian [2012] NSWSC 275
Brown v Faggoter [1998] NSWCA 44
Buckland Deceased, Re [1966] VR 404
Churton v Christian (1988) 13 NSWLR 241
Collins v McGain [2003] NSWCA 190
Collins v Mutton [2012] NSWSC 548
Cooper v Dungan (1976) 50 ALJR 539
Davis v Davis; Robyn Davis by Her Tutor Sandra Arnold v Ian Andrew Davis as the executor of the estate of the late John Joseph Davis [2012] NSWSC 201
Devereaux-Warnes v Hall (No 3) [2007] WASCA 235; (2007) 35 WAR 127
Diver v Neal [2009] NSWCA 54
Edgar v Public Trustee for the Northern Territory [2011] NTSC 5
Evans v Levy [2011] NSWCA 125
Foley v Ellis [2008] NSWCA 288
Frey v Frey (as personal representatives of the estate of HE Frey, dec'd) [2009] QSC 43
Fulop Deceased, Re (1987) 8 NSWLR 679
Gardiner v Gardiner (NSWSC, 28 May 1998, unreported)
Goodman v Windeyer (1980) 144 CLR 490
Gorton v Parks (1989) 17 NSWLR 1
Hakim, Re Estate of; Simons v Permanent Trustee Co Ltd [2005] NSWSC 223
Haklany v Gittany [2011] NSWSC 1549
Hughes v National Trustees Executors and Agency Co. of Australasia Ltd (1979) 143 CLR 134
Hyatt v Covalea [2011] VSC 334
Hyland v Burbidge [2000] NSWSC 12
Kay v Archbold [2008] NSWSC 254
Kembrey v Cuskelly [2008] NSWSC 262
Kleinig v Neal (No 2) (1981) 2 NSWLR 532
McCosker v McCosker (1957) 97 CLR 566
McKenzie v Baddeley [1991] NSWCA 197
Matthews v Wear [2011] NSWSC 1145
Mayfield v Lloyd-Williams [2004] NSWSC 419
Morrison v Carruthers [2010] NSWSC 430
Neil v Jacovou [2011] NSWSC 87
O'Dea v O'Dea [2005] NSWSC 46
Paola v State Trustees Ltd [2012] VSC 158
Pearson v Jones [2000] NSWSC 799
Penfold v Perpetual Trustee [2002] NSWSC 648
Petrohilos v Hunter (1991) 25 NSWLR 343
Pontifical Society for the Propagation of the Faith v Scales [1962] HCA 19; (1962) 107 CLR 9
Porthouse v Bridge [2007] NSWSC 686
Puckridge, Deceased, In the Estate of (1978) 20 SASR 72
Sayer v Sayer [1999] NSWCA 340
Shaw v Shaw [2003] VSC 318; (2003) 11 VR 95
Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201
Skinner v Frappell [2008] NSWCA 296
Stern v Sekers; Sekers v Sekers [2010] NSWSC 59
Stiles v Joseph (NSWSC, 16 December 1996, unreported)
Stott v Cook (1960) 33 ALJR 447
Tsivinsky v Tsivinsky [1991] NSWCA 269
Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191
Walker v Walker (NSWSC, Young J, 17 May 1996, unreported)
Williams v Legg (NSWCA, 16 March 1993, unreported)Category: Principal judgment Parties: Richard Anthony Sammut (Plaintiff)
Frank John Kleemann (first Defendant)
Jann Maria Kleemann (second Defendant)Representation: Counsel:
Mr M Thompson (Plaintiff)
Mr R Wilson (Defendants)
Solicitors:
Gerard Malouf & Partners (Plaintiff)
Pritchard Law Group (Defendants)
File Number(s): 2011/211302
JUDGMENT
HIS HONOUR: The Plaintiff, Richard Anthony Sammut, applies for a family provision order under Chapter 3 of the Succession Act 2006 ("the Act"). The Act applies in respect of the estate of a person who died on, or after, 1 March 2009. The Act replaces the Family Provision Act 1982 ("the former Act"), which was repealed, effective from 1 March 2009. A family provision order is an order made by the court, under Chapter 3, in relation to the estate, or notional estate, of a deceased person, to provide from that estate for the maintenance, education, or advancement in life, of an eligible person.
The deceased, whose estate is the subject of the claim, is Gladys Amy Nell Kleemann ("the deceased"). The Plaintiff is a grandchild of the deceased.
The Plaintiff commenced the proceedings by Summons filed on 29 June 2011, that is, within the time prescribed by s 58(2) of the Act (not later than 12 months after the date of the death of the deceased).
The Defendants named in the Summons are the son, Frank John Kleemann, and the daughter-in-law, Jann Marie Kleemann, of the deceased and the executors appointed in the Will of the deceased to whom Probate has been granted.
Even though the bulk of the estate is said by the Defendants to have been distributed, there is no requirement, in the present case, for designation of property as notional estate of the deceased. The Defendants, by their counsel, have acknowledged that they will meet the provision, if any, made for the Plaintiff. In those circumstances, it will not be necessary to consider or discuss the provisions of the Act that relate to notional estate.
Without any undue familiarity, or disrespect intended, and for convenience, I shall refer to the Plaintiff, the Defendants, and any other family members, after introduction, by his, or her, given name, in these reasons rather than the role each plays in the proceedings.
Formal and Background Facts
The following facts are uncontroversial and provide a useful background.
The deceased died on 3 July 2010. She was then aged about 89 years.
The deceased was married to Frank Kleemann, but they separated in about 1968 or 1969. He died in about 1993. There were two children of their marriage, namely Frank, the first Defendant, and Margo Jennifer Sammut.
Frank was born in March 1951.
Margo, who was born in March 1957, predeceased the deceased, having died in May 2007. Richard is the son of Margo. He is the nephew of Frank. Margo had another child, John Francis Sammut, who was born in April 1976.
Following the separation of the deceased and her husband, the deceased entered into a relationship with Lance Powell, with whom she lived until his death in 2009.
The deceased left a Will that she made on 18 March 2003, Probate of which was granted, by this Court, to the Defendants, on 26 August 2010. The Will, relevantly, provided, in the events that have happened, for the whole of the deceased's estate to pass to the Defendants equally.
Although not relevant to the way in which the estate was to be distributed, reference should be made to Clause 3 of the deceased's Will, which was in the following terms:
"...
3.I DIRECT that the following provisions of this my Will shall prevail:
(a)As to my interest in property known as xx Brown Avenue, Botany being property comprised within Folio Identifier xx/xxxxx I DIRECT my Trustees to sell the same and:-
(i)In their absolute discretion employ and utilize one-half of the net proceeds of sale towards the purchase (inclusive of legal fees, expenses and disbursements on purchase) by them and in their name of another residential property ("substituted property") for the occupation of my daughter, MARGOT JENNIFER SAMMUT so long as and provided that she:-
(aa)Pays rates and taxes and other outgoings.
(bb)Keeps it in a good and habitable state of repair, fair wear and tear and damage by fire, lightning, flood, tempest and other inevitable accident or act of God excepted.
(cc)Keeps it insured to the full insurable value with a reputable and solvent Insurer and pays the premium for insurance cover including for property (against the risks of not less than fire, storm and tempest), public liability and occasional workers Workers' Compensation cover.
(ii)Alternatively to Clause 3 (a) (i) above deposit one-half of the net proceeds of sale on a Term Deposit with an Australian Bank in their name and pay all interest, net of fees, charges and taxes to my said daughter, MARGOT JENNIFER SAMMUT.
(b)I DIRECT that on the earlier of:
(i)The death of my daughter MARGOT JENNIFER SAMMUT or
(ii)In the event of my entering into a Contract for the sale of my interest in xx Brown Avenue, Botany before my death and should the proceeds not have been personally received by me then I DIRECT that one-half of the net proceeds are not to form part of my residuary estate but are to be dealt with as above directed in Clause 3(a)(i) or 3(a)(ii)
(iii)She failing to comply with the terms and conditions as to residency and occupation as referred to in Clause 3(a)(i)(aa), (bb) and (cc) hereof or
(iv)The said MARGOT JENNIFER SAMMUT ceasing to permanently reside or live in the substituted property which apart from the taking of holidays or being hospitalised shall be conclusively evidenced by my said daughter not occupying the substituted property for a period of twelve (12) consecutive weeks then I DIRECT that my Trustees to sell the substituted property or close the Term Deposit, as the case applies and to account for the net proceeds to JOHN FRANCIS SAMMUT and RICHARD ANTHONY SAMMUT in equal shares and if only one of them is then surviving then I DIRECT the whole of the net proceeds is to be paid to the survivor of JOHN FRANCIS SAMMUT or RICHARD ANTHONY SAMMUT.
(c)I DIRECT that any money left over from the one-half proceeds of sale of the property, xx Brown Avenue, Botany following the purchase of the substituted property shall form part of the rest, remainder and residue of my Estate."
The Botany property referred to in the Will of the deceased was sold in 2003.
In the Inventory of Property, a copy of which was placed inside, and attached to, the Probate document, the deceased's estate, at the date of death, was disclosed as having an estimated, or known, gross value of $875,492. No liabilities were disclosed. The estate was said to then consist of the deceased's interest in her unit in a retirement village at Camden South ($350,000), money in current accounts ($353,987), money in banks or financial institutions ($170,005), furniture watches and jewellery (no value) and a funeral benefit payment ($1,500). (I have omitted any reference to the cents in amounts stated and shall continue to do so.)
In an affidavit, sworn on 16 August 2012, by Frank, the gross value of the estate was said to be $817,230. After payment of some costs, expenses, and disbursements, including some legal costs of the proceedings, the net distributable estate is said to be $790,609. However, of that amount a partial distribution of $711,921 has been made to the Defendants. There is only $17,507 held in the Defendant's solicitor's trust account and an unrealised asset, being an income fund ($61,180).
At the hearing, the parties agreed that the amount of $790,609 is the amount, before the payment of costs of the proceedings, that is available for distribution.
In calculating the value of the estate of the deceased, that is available, finally, for distribution, the costs of the present proceedings should also be considered, since the Plaintiff, if successful, normally, would be entitled to an order that his costs, calculated on the ordinary basis, be paid out of that estate, whilst the Defendants, irrespective of the outcome of the proceedings, normally, will be entitled to an order that their costs, calculated on the indemnity basis, be paid out of that estate.
The Plaintiff's costs and disbursements have been estimated to be $84,352, if calculated on the ordinary basis, and $86,337, if calculated on the indemnity basis. The estimate, in each case, is inclusive of GST but was based on a two-day hearing. (The case was listed for one day and was completed within that time.)
The Plaintiff's counsel informed me, from the bar table, without objection, that based upon a one-day hearing and inclusive of GST, the Plaintiff's costs and disbursements were estimated to be $69,246, if calculated on the ordinary basis, and $73,646, if calculated on the indemnity basis.
The Defendants' costs and disbursements are estimated to be $36,007, if calculated on the indemnity basis. The estimate is inclusive of GST and is based on a one-day hearing. Of this amount, about $18,000 has already been paid out of the deceased's estate. The balance remaining to be paid out of the estate is about $18,000. (The costs of obtaining probate and other administration expenses ($9,900) have also been paid out of the estate.)
It can be seen, therefore, that the estimated value of the net distributable estate, after the payment of the Plaintiff's estimated costs calculated on the ordinary basis and the balance of the Defendants' estimated costs calculated on the indemnity basis ($87,246 in total), would be about $703,363.
Before leaving the topic of costs, I should mention that the Defendants stated that in the event that Richard is unsuccessful in his claim, they did not seek an order that he should pay their costs of the proceedings. Richard's counsel indicated that in the event that the Plaintiff is successful, an application may be made that his costs, calculated on the indemnity basis, should be paid out of the estate.
Of course, depending upon the result of the case, and the order, or orders, for costs, if any, that is, or are, made, the costs and disbursements, if payable out of the estate will be able to be formally assessed, unless otherwise agreed by the parties.
The Defendants assert that there are no persons who are eligible persons, within the meaning of the Act. There is a dispute about the eligibility of Richard and John.
The notice prescribed by the Act has not been served on any person. Richard gave oral evidence that he had spoken to his brother, John, at about the time of these proceedings being commenced. Richard then told John that he was entitled to make a claim, but that John said that he was not interested in making a claim and "did not want to have anything to do with it".
Richard also gave evidence that he does not know John's present whereabouts and has lost contact with him.
It appears from this evidence that it would be impracticable to serve John with the prescribed notice, as there is no other evidence as to his present whereabouts. For the purposes of this case, since John was made aware of Richard's proceedings, albeit orally, I am prepared to disregard his interests as a person in respect of whom an application for a family provision order may be made, and am satisfied that service of any such notice is unnecessary, or impracticable, in the circumstances.
As the only beneficiaries are parties to the proceedings, there is no doubt so far as service of the prescribed notice upon each of them is concerned.
Following Margo's death, the Plaintiff, in about April 2008, inherited $50,000 from her estate. He paid the amount he inherited towards reducing the mortgage on his wife's, Ann's, home unit at Hurstville.
The Statutory Scheme - The Act
Introduction
I shall discuss the statutory scheme and the principles that are relevant to the facts of the present case. Although I have set out some of what I state hereunder in other cases, in view of the importance of this case to the parties, I shall repeat the principles. It is important that they be able to follow the reasoning and for each to be satisfied that I have considered the evidence and the submissions in the application.
The former Act was repealed by s 5 of the Succession Amendment (Family Provision) Act 2008. A new Chapter 3 was added to the Act, which dealt with the topic of family provision from deceased estates. The long title of the Act describes that new Chapter as one to ensure that adequate provision is made for the members of the family of a deceased person, and certain other persons, from the estate of the deceased person. Importantly, this should not be taken to mean that the Act confers upon those persons, a statutory entitlement to receive a certain portion of a deceased person's estate. Nor does it impose any limitation on the deceased person's power of disposition by his, or her, will. It is only if the statutory conditions are satisfied, that the court is empowered, under the Act, to alter a deceased person's disposition to produce a result that is consistent with the purpose of the Act. Even then, the court's power to do so is discretionary.
In cases such as the present, it is necessary for the Court to take three steps:
(i) determine whether the applicant is an eligible person within the meaning of that term in s 57(1) of the Act;
(ii) determine in the case, relevantly, of a s 57(1)(e) applicant, whether the Court is satisfied that there are factors which warrant the making of the application within s 59(1)(b) of the Act; and, if both eligibility and factors warranting are established,
(iii) determine whether the applicant has been left with inadequate provision for his, or her, proper maintenance, education and advancement in life; and, if so, what, if any, provision (or further provision) ought to be made out of the estate for those purposes?
The Substantive Provisions of the Act
The key provision is s 59 of the Act. The Court must be satisfied, first, that the applicant is an eligible person. In New South Wales, it is a multi-category based eligibility system, rather than one with a general category of eligibility (as it is, for example, in Victoria). There are six categories of persons by, or on whose behalf, an application may be made. Relevantly, one category is "a person who was, at any particular time, wholly or partly dependent on the deceased person, and who is a grandchild of the deceased person, or who was a member of the household of which the deceased person was a member" (s 57(1)(e) of the Act).
In the present case, Richard relies only upon the fact that he "is a grandchild of the deceased" (not "a member of the household of which the deceased was a member"). That language is expressive of his status, as well as his relationship to the deceased. There is no age limit placed on a grandchild making an application.
To be an eligible person within this category, there is also a pre-condition of whole, or partial, dependency. The Act contains no definition of the words "dependent on". In general, the word "dependent" connotes a person who relies upon support of another, financial and/or emotional. Dependency is not limited only to the class of persons actually in receipt of financial assistance from the deceased. The authorities reveal that the words are wide enough to cover any person who would naturally rely upon, or look to, the deceased, rather than to others, for anything necessary, or desirable, for his, or her, maintenance and support.
In Amaca Pty Ltd v Novek [2009] NSWCA 50, Campbell JA, with whom the other members of the Court of Appeal agreed, said (in the context of a claim under section 15B of the Civil Liability Act 2002):
"[42] Mr Russell recognises that the definition of "dependants" in s 15B admits of the possibility that a person who a claimant had no legal obligation to support could nonetheless be a dependant of the claimant. That is because the definition includes, as potential dependants, people in as diverse a set of relationships to the claimant as a de facto partner, a sibling, a niece, and any member of the claimant's household. However, he submits that, in the case of a child, if there is someone who has the primary legal and moral obligation to care for the child, the child is dependent on that person, unless that person "wasn't around" and someone else took on that obligation.
[43] I see no trace in the legislation of the notion of a "primary legal and moral obligation".
[44] In my view, the law remains accurately stated by the joint judgment of Sugerman P, Jacobs and Mason JJA in Middleton v Kiama District Hospital [1970] 3 NSWR 136. Their Honours said, at 138:
'Dependency is, moreover, a complex question of fact, which may involve the consideration of many elements, including both past events and future probabilities. It is not necessarily correlative with a legal duty to maintain. A person may in fact be dependent upon another who is under no legal duty to maintain him; and may be so dependent even though there is also in existence one who has legal duty to maintain, eg a husband his wife. On the other hand there may be no dependency in fact upon a person who is under a legal duty to maintain. The existence of the legal duty is, however, one of the many elements to be taken into account in deciding upon a question of dependency in fact. Dependency and actual support are not necessarily correlative. There may be dependency although for the time being there is no actual support. And it seems to us to be possible to figure cases in which there may have been a provision of support, or of some measure of support, at least for a short time or for some special purpose, which did not amount to dependency. The definition of "dependants" does not merely refer to one who was in fact supported by the deceased worker at the time of his death; a "dependant" is a member of the workers' family who was "wholly or partly dependent for support upon the worker at the time of his death". Dependency refers to a state or condition of being dependent, to having been in this relationship to the deceased. As to all the above matters see Hodges v Scotts' Provision (Wholesale) Pty Ltd [1963] WCR 161 and cases there cited.'"
In Skinner v Frappell [2008] NSWCA 296, Young CJ in Eq, (with whom Campbell JA agreed) sitting in the Court of Appeal at [85] wrote:
"The matter as to what is required for dependency was fully dealt with by this Court in Petrohilos v Hunter (1991) 25 NSWLR 343. Although dependency is not limited to financial dependency, it does involve one person being beholden to another person for some material, or physical, help or succour, emotional dependency is not enough."
In Re Estate of Hakim; Simons v Permanent Trustee Co Ltd [2005] NSWSC 223, Palmer J said:
"42 Dependence for the purpose of s 6(1)(d), so far as the cases have discussed, is seen as the giving of financial or other material assistance by the deceased over a significant period of time in order to meet a need of the eligible person, with the result that the recipient has come ordinarily to rely upon that assistance."
In Williams v Legg (NSWCA, 16 March 1993, unreported), in a passage not set out in the report at (1993) 29 NSWLR 687, the Court of Appeal (Handley, Sheller and Cripps JJA) said:
"There has been a tendency in some cases to equate "dependent" with "financially dependent". In Petrohilos v Hunter (1991) 25 NSWLR 343 at 346 Hope JA, with whom the other members of the Court agreed, pointed out that while one of the commonest forms of dependence may be a financial one "in the sense that the dependence flows from the fact that accommodation, food, clothing and other necessities or amenities of life are provided by the person who owns or is otherwise entitled to the accommodation and pays the other things" the word, as used in the statute, is not limited to financial dependence. Reference was made to what was said by Samuels JA in Ball v Newey (1988) 13 NSWLR 489 at 491. "Dependent" in the ordinary sense of the word, means the condition of depending on something or on someone for what is needed."
In Petrohilos v Hunter (1991) 25 NSWLR 343, at 346-347, it had been said by Hope AJA:
"The word "dependent" is an ordinary English word, and whether a person is or has been wholly or partly dependent upon another is a question of fact. No doubt, one of the commonest forms of dependency is a financial one, in the sense that the dependence flows from the fact that accommodation, food, clothing and other necessities or amenities of life are provided by the person who owns or is otherwise entitled to the accommodation and pays for the other things. But I do not think that the word, as used in the statute or otherwise, has this very limited meaning. In ordinary parlance young children are properly and commonly said to be dependent on their mother as well as their father, regardless of where the money comes from. A contrary view, that young children are not dependent on their mother if she has no independent means, seems to me to be a misuse of the language. This accords with what Samuels JA said in Ball v Newey at 491, that "'Dependent' in the ordinary sense of the word, means the condition of depending on something or on someone for what is needed". If the correct view were that the context of the statute requires a limitation of the word to "financial or material" matters as McClelland J said in Re Fulop (dec'd) or to "other forms of dependence analogous to but distinct from financial dependence" as Samuels JA suggested in Ball v Newey (at 491), then surely a mother's services to a young child satisfy the test. The child could not survive without the provision of those services; he or she needs them. To suggest that, in a money sense they are valueless, is simply wrong. If the provision of accommodation by a father for a young child, that is, having the child live in a house which he owns and lives in, can make the child partly dependent upon the father as it undoubtedly can, I am unable to see why the provision by a mother to her children, living with her, of the services essential for their well-being does not make them partly dependent upon her. In my opinion it does. The same considerations apply to a step-child or his or her step-mother when the child lives with the step-mother and is looked after by her. I appreciate that a different view has been taken by others, as for example by Powell J in Dunn v Public Trustee (Powell J, 1 June 1989, unreported), but I would respectfully disagree with that view. In my opinion the plaintiff was partly dependent upon the deceased, certainly for many years of her childhood and probably until her marriage, although no doubt her dependence diminished in the latter years of this period."
The finding in Petrohilos v Hunter was that the plaintiff had been dependent upon her stepmother, in circumstances where, as a child, the plaintiff had lived with her father and stepmother. The stepmother "did all those things for the plaintiff that a mother in her circumstances does for a daughter from the age of five to the age of eighteen." As Campbell JA noted in Amaca Pty Ltd v Novek, at [41], "That case illustrates how a relationship of dependency can exist even when there is not the sort of obligation that a mother has to care for her own child".
In McKenzie v Baddeley [1991] NSWCA 197, Priestley JA (with whom Hope AJA agreed) held that the word "partly" in the phrase "partly dependent", whilst a word of "some elasticity", does not mean "substantially", but means "more than minimally", or perhaps, "significantly". Meagher JA commented that "Common sense requires that certain trivial activities should be disregarded".
A similar view was taken by the Court of Appeal, more recently, in Alexander v Jansson [2010] NSWCA 176 at [13].
In Morrison v Carruthers [2010] NSWSC 430, a case involving a claim by a grandchild in which only financial dependency was relied upon, Bergin CJ in Eq, after referring to McKenzie v Baddeley said at [12]:
"[12] It may be difficult to identify any real difference between the meaning of the words "substantially" ("of real importance or value") and "significantly" ("of real import") in this context: The Concise Oxford Dictionary, however I am of the view that financially "partly dependent" in this context means that the applicant relied on the deceased to provide financial support without which the applicant would not have been able to meet the reasonable costs of living. The assessment of dependency in respect of a child will be different from the assessment of dependency in respect of an adult. When an adult grandchild claims financial dependency there will be matters that need consideration that would not be relevant in the case of a child. It is important in this regard to draw the distinction between expectation and dependence. If an adult receives payment on a regular basis from the deceased and chooses not to obtain money from another available source because of the expectation of regular payment from the deceased, that does not amount to dependence within the meaning of that term in the Act. Financial dependency in the case of a healthy adult who is able to work means a necessity to rely on the deceased because there is no other source of finance available."
The question of dependency, whether whole or partial, is a complex question of fact.
In the case of an applicant who falls within s 57(1)(d), (e) or (f), the Court must next consider, and be satisfied that, having regard to all the circumstances of the case (whether past or present), there are factors which warrant the making of the application (s 59(1)(b)).
The Act does not specify the "factors which warrant the making of the application". In considering the meaning of what he described as "this poorly conceived and clumsily expressed subsection" in the former Act (which did not form part of the Draft Bill produced by the Law Reform Commission), M McLelland J said, in Re Fulop Deceased (1987) 8 NSWLR 679 at 681 (approved in substance by the Court of Appeal in Churton v Christian (1988) 13 NSWLR 241) that the factors are factors which, when added to facts which render the applicant an eligible person, give him, or her, the status of a person who would be generally regarded as a natural object of testamentary recognition by the deceased.
Kirby P in Tsivinsky v Tsivinsky [1991] NSWCA 269, in dealing with the section of the former Act, which was in similar terms, said:
"Insofar as s 9(1) gives any guidance concerning the factors 'which warrant the making of the application', it is Delphic. The language used is extremely broad in its generality ('all the circumstances', 'whether past or present', 'factors... warrant making the application', 'satisfies'). The only real clue as to what is meant is to be derived from the apparent policy of confining this additional, preliminary procedure to the particular categories of 'eligible person' contained in the definition paras (c) and (d) in s 6(1) of the Act."
In Brown v Faggoter [1998] NSWCA 44, a decision of the Court of Appeal constituted by Sheller JA, Sheppard and Fitzgerald AJJA, there was the suggestion that an application might be warranted if the application has reasonable prospects of success. This seems to be a somewhat different and, perhaps, an easier, test than that which the Court of Appeal approved in Churton v Christian.
In Penfold v Perpetual Trustee [2002] NSWSC 648, Windeyer J did not follow Brown v Faggoter.
Bryson AJ also commented in Porthouse v Bridge [2007] NSWSC 686:
"7 This provision gives no clear indication of the nature of the factors which should be regarded as warranting the making of the application. Decision whether there are factors which warrant the making of the application is committed to the Court in extremely general language; the Court is to have regard to all the circumstances of the case (whether past or present). The effect is that a very broad power is given to the judge who hears the case to recognize and assess the significance of the circumstances of the case and what regard should be paid to them, what the factors are and what they warrant. There may be very cogent factors which demonstrate that the making of the application is warranted, but it is unlikely that this will often be the case, and the section commits to the Court a power of determination which is difficult to distinguish from a discretion of the broadest kind.
...
9 ... The recognition of factors and their weight is left to the determination and opinion of the Judge. In my opinion it would be an error to treat the strength of a claim for provision under s 7 as determinative, either way, of the question under s 9(1). Factors, however strong, which show that the making of the application is not warranted are not the object of enquiry and appear to be irrelevant. The use of language referring to a plurality of factors ("there are factors") is not in my opinion to be understood literally as meaning that the Court must recognize separately more than one factor; in my opinion the plural is used to indicate the generalised nature of the matter under determination."
In Diver v Neal [2009] NSWCA 54 (also (2009) 2ASTLR 89), Basten JA, with whom Allsop P and Ipp JA agreed, said of s 9(1) of the former Act:
"8 As noted above, compliance with this requirement was not the first issue addressed by the primary judge, although s 9(1) envisages that it is to be determined before the Court decides whether to "proceed with the determination of the application". In practice, the factors relevant to the issue raised as a preliminary matter are, to a significant extent, co-extensive with those which must be addressed in determining whether the testator made adequate provision for the applicant: see Churton v Christian (1988) 13 NSWLR 241 at 242-243 (Hope JA) and 248-249 (Priestley JA). Nevertheless, the express distinction between two classes of eligible person must be recognised. It appears to have been drawn on the basis that persons falling within the first category (comprised of those identified in pars (a) and (b)) are "regarded as natural objects of testamentary recognition", whereas those falling within the second category (identified in pars (c) and (d)) are potentially appropriate objects of testamentary recognition, depending upon their circumstances: see Churton at 252 (Priestley JA) applying the analysis of McLelland J in Re Fulop Deceased (1987) 8 NSWLR 679 at 681."
More recently, in Evans v Levy [2011] NSWCA 125, Young JA, with whom Campbell JA and Sackville AJA agreed, said:
"[62] It would seem that what the drafter of the legislation of 1982 did was to endeavour to avoid some of the complications that had been found to exist with cases under the 1916 Act as to just who was an eligible person by broadening the category to a very extensive degree. However, to provide some sort of filter, s 9(1) was enacted so that, without the estate having to get into a great expense, the question of whether the application could possibly succeed would be determined early. Unfortunately, experience has shown that that was a vain hope.
[63] However, the intended result of the wide nature of para (d) of the definition of "eligible person" and s 9(1) is to seek to restrict people whose claims should proceed to a hearing to those who are in very similar categories to those who are within paras (a) and (b) of the definition.
[64] On s 9, the decision of M McLelland J in Re Fulop (dec'd) (1987) 8 NSWLR 679 has stood the test of time."
It can be seen that the trend of authorities does not favour the view suggested in Brown v Faggoter. With great respect, I also regard the views expressed in the authorities referred to by Windeyer J, Bryson AJ, Basten JA, Campbell JA, and Young JA as correct, and propose, in the circumstances, to follow their decisions.
Then, if eligibility and factors warranting the making of the application are found, the Court must determine whether adequate provision for the proper maintenance, education and advancement in life of the applicant has not been made by the will of the deceased, or by the operation of the intestacy rules in relation to the estate of the deceased, or both (s 59(1)(c)). It is only if the Court is satisfied of the inadequacy of provision, that consideration is given to whether to make a family provision order (s 59(2)). It may take into consideration, the matters referred to in s 60(2) of the Act at both stages of enquiry: eligibility, and whether to make an order (s 60(1)). In this way, the Court carries out a two-stage process.
Other than by reference to the provision made in the will of the deceased, or by the operation of the intestacy rules in relation to the estate of the deceased, or both, s 59(1)(c) leaves undefined the norm by which the Court must determine whether the provision, if any, is inadequate for the applicant's proper maintenance, education and advancement in life. The question would appear to be answered by an evaluation that takes the court to the provision actually made in the deceased's will, or on intestacy, or both, on the one hand, and to the requirement for maintenance, education and advancement in life of the applicant on the other. No criteria are prescribed in the Act as to the circumstances that do, or do not, constitute inadequate provision for the proper maintenance, education and advancement in life of the applicant.
It was said in the Court of Appeal (per Basten JA) in Foley v Ellis [2008] NSWCA 288 at [3], that the state of satisfaction "depends upon a multi-faceted evaluative judgment". In Kay v Archbold [2008] NSWSC 254, at [126], White J said that the assessment of what provision is proper involved "an intuitive assessment".
Under s 59(1)(c) of the Act, the time at which the court gives its consideration to the question is the time when the court is considering the application. Under s 59(2), the Court has regard to the facts known to the court at the time the order is made. Importantly, there no longer appears to be any sanction to consider, in s 59(1)(c) of the Act, the provision made by the deceased during his, or her, lifetime for the applicant (see, s 9(2) of the former Act).
"Provision" is not defined by the Act, but it was noted in Diver v Neal at [34], that the term "covers the many forms of support and assistance which one individual can give to another. That support and assistance will vary over the course of the person's lifetime".
Neither is the word "maintenance", nor the phrase "advancement in life", defined in the Act. However, in Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191, Callinan and Heydon JJ, at 228-229, said, of the words "maintenance", "support" and "advancement":
"'Maintenance' may imply a continuity of a pre-existing state of affairs, or provision over and above a mere sufficiency of means upon which to live. 'Support' similarly may imply provision beyond bare need. The use of the two terms serves to amplify the powers conferred upon the court. And, furthermore, provision to secure or promote 'advancement' would ordinarily be provision beyond the necessities of life. It is not difficult to conceive of a case in which it appears that sufficient provision for support and maintenance has been made, but that in the circumstances, say, of a promise or an expectation reasonably held, further provision would be proper to enable a potential beneficiary to improve his or her prospects in life, or to undertake further education."
In Alexander v Jansson, Brereton J (with whom Basten JA and Handley AJA agreed), at [18], stated:
"Proper maintenance is not limited to the bare sustenance of a claimant [cf Gorton v Parkes (sic) [1989] 17 NSWLR 1], but requires consideration of the totality of the claimant's position in life including age, status, relationship with the deceased, financial circumstances, the environs to which he or she is accustomed, and mobility."
In In the Estate of Puckridge, Deceased (1978) 20 SASR 72, at 77 King CJ said:
"The words 'advancement in life' have a wide meaning and application and there is nothing to confine the operation of the provision to an earlier period of life in the members of the family: Blore v Lang (1960) 104 CLR 124, per Dixon CJ at 128."
Master Macready (as his Honour then was) in Stiles v Joseph (NSWSC, 16 December 1996, unreported) said, at 14-16:
"Apart from the High Court's statement that the words 'advancement in life' have a wide meaning and application ... there is little (if any) case law on the meaning of 'advancement' in the context of family provision applications. Zelling J in In The Estate of Wardle (1979) 22 SASR 139 at 144, had the same problem. However, commonly in decisions in which the Applicant's 'advancement in life' has been in issue, the Court has looked only at the material or financial situation of the Applicant, and there is nothing to suggest that provision for the Applicant's 'advancement in life' means anything more than material or financial advancement. For example, in Kleinig v Neal (No 2) [1981] 2 NSWLR 532, Holland J, discusses the financial assistance which an applicant may need for his or her maintenance and advancement in life in the following terms:- If the court is to make a judgment as to what a wise and just testator ought to have done in all the circumstances of the case, it could not be right to ignore that the particular testator was a wealthy man in considering what he ought to have done for his widow or children in making provision for their maintenance, education or advancement in life. There are different levels of need for such things. In the case of maintenance and advancement in life they can range from bare subsistence up to anything short of sheer luxury. A desire to improve one's standard of living or a desire to fulfil one's ambition for a career or to make the fullest use of one's skills and abilities in a trade or business, if hindered or frustrated by the lack of financial means required for the fulfilment of such desire or ambition, presents a need for such assistance and it would seem to me that it is open to a court to say, in the case of a wealthy spouse or parent who could have but has failed to provide such financial assistance, that . . . [the deceased] has failed to make adequate provision for the proper maintenance and advancement in life of the spouse or children who had such need. (at 541)
In Pilkington v Inland Revenue Commissioners [1964] AC 612, Viscount Radcliffe defined 'advancement', in the context of a trustee's powers, as 'any use of ... money which will improve the material situation of the beneficiary' (at 635), and this definition was cited with approval by Pennycuick J in Re Clore's Settlement Trust; Sainer v Clore [1966] 2 All ER 272 at 274...
In Certoma, The Law of Succession In New South Wales (2nd Ed) at 208, it is said:
'Although 'maintenance' does not mean mere subsistence, in the context of the New South Wales Act, it probably does not extend to substantial capital investments such as the purchase of a business, an income-producing property or a home for the Applicant because these forms of provision are more likely to be within the power of the Court under 'advancement in life'. Maintenance is rather concerned with the discharge of the recurrent costs of daily living and not generally with substantial capital benefit.'
The Queensland Law Reform Commission, in its Working Paper on Uniform Succession Laws: Family Provision (Working Paper 47, 1995) ... notes ... that:
'Whereas support, maintenance and education are words traditionally associated with the expenditure of income, advancement has been associated with the expenditure of capital, such as setting a person up in business or upon marriage.'"
In Mayfield v Lloyd-Williams [2004] NSWSC 419, White J at [114] noted:
"In the context of the Act the expression advancement in life is not confined to an advancement of an applicant in his or her younger years. It is phrase of wide import. (McCosker v McCosker (1957) 97 CLR 566 at 575) The phrase "advancement in life" has expanded the concept used in the Victorian legislation which was considered in Re Buckland permitting provision to be made for the "maintenance and support" of an eligible applicant. However Adam J emphasised that in a large estate a more extravagant allowance for contingencies could be made than would be permissible in a small estate and still fall within the conception of maintenance and support."
In Bartlett v Coomber [2008] NSWCA 100, at [50], Mason P said:
"The concept of advancement in life goes beyond the need for education and maintenance. In a proper case it will extend to a capital payment designed to set a person up in business or upon marriage (McCosker v McCosker (1957) 97 CLR 566 at 575; Stiles v Joseph, (NSW Supreme Court, Macready M, 16 December 1996); Mayfield v Lloyd-Williams [2004] NSWSC 419)."
The word "adequate" connotes something different from the word "proper". "Adequate" is concerned with the quantum, whereas "proper" prescribes the standard, of the maintenance, education and advancement in life: Devereaux-Warnes v Hall (No 3) [2007] WASCA 235; (2007) 35 WAR 127 at [72] and at [77] per Buss JA.
Each of the words was considered by Lord Romer in delivering the advice of the Privy Council in Bosch v Perpetual Trustee Co Ltd [1938] AC 463, at 476:
"The use of the word 'proper' in this connection is of considerable importance. It connotes something different from the word 'adequate'. A small sum may be sufficient for the 'adequate' maintenance of a child, for instance, but, having regard to the child's station in life and the fortune of his father, it may be wholly insufficient for his 'proper' maintenance. So, too, a sum may be quite insufficient for the 'adequate' maintenance of a child and yet may be sufficient for his maintenance on a scale that is 'proper' in all the circumstances."
Dixon CJ and Williams J, in McCosker v McCosker (1957) 97 CLR 566 at 571-572, after citing Bosch v Perpetual Trustee Co Ltd, went on to say, of the word "proper", that:
"It means proper in all the circumstances of the case, so that the question whether a widow or child of a testator has been left without adequate provision for his or her proper maintenance, education or advancement if life must be considered in the light of the competing claims upon the bounty of the testator and their relative urgency, the standard of living his family enjoyed in his lifetime, in the case of a child his or her need of education or of assistance in some chosen occupation and the testator's ability to meet such claims having regard to the size of his fortune. If the court considers that there has been a breach by a testator of his duty as a wise and just husband or father to make adequate provision for the proper maintenance education or advancement in life of the applicant, having regard to all these circumstances, the court has jurisdiction to remedy the breach and for that purpose to modify the testator's testamentary dispositions to the necessary extent."
In Goodman v Windeyer (1980) 144 CLR 490, Gibbs J said at 502:
"[T]he words 'adequate' and 'proper' are always relative. There are no fixed standards, and the court is left to form opinions upon the basis of its own general knowledge and experience of current social conditions and standards."
In Vigolo v Bostin, at 228, Callinan and Heydon JJ said:
"[T]he use of the word "proper"...implies something beyond mere dollars and cents. Its use, it seems to us, invites consideration of all the relevant surrounding circumstances and would entitle a court to have regard to a promise of a kind which was made here...The use of the word "proper" means that attention may be given, in deciding whether adequate provision has been made, to such matters as what use to be called the "station in life" of the parties and the expectations to which that has given rise, in other words, reciprocal claims and duties based upon how the parties lived and might reasonably expect to have lived in the future."
Santow J pointed out in Gardiner v Gardiner (NSWSC, 28 May 1998, unreported), that "adequate" and "proper" are independent concepts. He said at 12:
"'Adequate' relates to the needs of the applicant. It is determined by reference to events occurring up to the death of the deceased, but also encompassing what the deceased might reasonably have foreseen before death. "Proper" depends upon all the circumstances of the case. These include the applicant's station in life, the wealth of the deceased, the means and proper claims of all applicants, the relative urgency of the various claims on the deceased's bounty, the applicant's conduct in relation to the deceased, the applicant's contribution to building up the deceased's estate, the existence of dependents upon the applicant, the effects of inflation, the applicant's age and sex, and whether the applicant is able-bodied ..."
The first stage of the process provided for by s 59(1)(c) has been described as "the jurisdictional question": Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201 at 208-209. At this stage, the court will consider whether it can make an order for provision for the maintenance, education and advancement in life of a particular applicant.
Whether the applicant has a 'need' or 'needs' is a relevant factor at the first stage of the enquiry. It is an elusive concept to define, yet, it is an element in determining whether 'adequate' provision has been made for the 'proper' maintenance, education and advancement in life of the applicant in all of the circumstances: Collins v McGain [2003] NSWCA 190 (Tobias JA, with whom Beazley and Hodgson JJA agreed).
Tobias JA said, at [42] and [47]:
"42. Further, there can be no question that, at least as part of the first stage of the process, the question of whether the eligible person has a relevant need of maintenance etc is a proper enquiry. This is so as the proper level of maintenance etc appropriate for an eligible person in all the circumstances clearly calls for a consideration of his or her needs. However, the question of needs must not be too narrowly focused. It must, in my view, take into account, depending upon the particular circumstances of the case, present and future needs including the need to guard against unforeseen contingencies.
...
47. As I have observed, the issue of need is not confined to whether or not an eligible person has, at the date of hearing, a then need for financial assistance with respect to his maintenance etc. It is a broader concept. This is so because the question of needs must be addressed in the context of the statutory requirement of what is "proper maintenance etc" of the eligible person. It is because of that context that, in the present case, the "proper maintenance etc" of the appellant required consideration of a need to guard against the contingency to which I have referred."
In Devereaux-Warnes v Hall (No 3), at [81] - [84], Buss JA said, in respect of the first stage of the process:
"The term 'need' has been used to refer to the claimant's inability to satisfy his or her financial requirements from his or her own resources. See Singer per Gaudron J at 227.
'Need' has also been used in the context of a value judgment or conclusion, namely, that the claimant is 'in need' of maintenance, etc, because inadequate provision has been made for his or her proper maintenance, etc. See Gorton v Parks (1989) 17 NSWLR 1 per Bryson J at 10-11.
The determination of whether the disposition of the deceased's estate was not such as to make adequate provision for the proper maintenance, etc, of the claimant will always, as a practical matter, involve an evaluation of the provision, if any, made for the claimant on the one hand, and the claimant's 'needs' that cannot be met from his or her own resources on the other. See Hunter per Kirby P at 575.
Although the existence or absence of 'needs' which the claimant cannot meet from his or her own resources will always be highly relevant and, often, decisive, the statutory formulation, and therefore the issue in every case, is whether the disposition of the deceased's estate was not such as to make adequate provision for his or her proper maintenance, etc. See Singer per Gaudron J at 227. Compare Gorton per Bryson J at 6-11; Collicoat v McMillan [1999] 3 VR 803 per Ormiston J at 816 [38], 820 [47]."
In the event that the court is satisfied that the power to make an order is enlivened (i.e. it is satisfied that the applicant is an eligible person, and, where necessary, that factors warranting have been satisfied, and that adequate provision for the proper maintenance, education or advancement in life of the person has not been made), then, the court determines whether it should make an order, and if so, the nature of any such order, having regard to the facts known to the court at the time the order is made.
The second stage of the process arises under s 59(2) and s 60(1)(b) of the Act. Mason CJ, Deane and McHugh JJ, in Singer v Berghouse, at 211, affirmed that the decision made at the second stage involves an exercise of discretion in the accepted sense. The fact that the court has a discretion means that it may refuse to make an order even though the jurisdictional question has been answered in the applicant's favour.
Section 60 of the Act, at least in part, is new. It provides:
"(1) The court may have regard to the matters set out in subsection (2) for the purpose of determining:
(a) whether the person in whose favour the order is sought to be made (the "applicant") is an eligible person, and
(b) whether to make a family provision order and the nature of any such order.
(2) The following matters may be considered by the court:
(a) any family or other relationship between the applicant and the deceased person, including the nature and duration of the relationship,
(b) the nature and extent of any obligations or responsibilities owed by the deceased person to the applicant, to any other person in respect of whom an application has been made for a family provision order or to any beneficiary of the deceased person's estate,
(c) the nature and extent of the deceased person's estate (including any property that is, or could be, designated as notional estate of the deceased person) and of any liabilities or charges to which the estate is subject, as in existence when the application is being considered,
(d) the financial resources (including earning capacity) and financial needs, both present and future, of the applicant, of any other person in respect of whom an application has been made for a family provision order or of any beneficiary of the deceased person's estate,
(e) if the applicant is cohabiting with another person-the financial circumstances of the other person,
(f) any physical, intellectual or mental disability of the applicant, any other person in respect of whom an application has been made for a family provision order or any beneficiary of the deceased person's estate that is in existence when the application is being considered or that may reasonably be anticipated,
(g) the age of the applicant when the application is being considered,
(h) any contribution (whether financial or otherwise) by the applicant to the acquisition, conservation and improvement of the estate of the deceased person or to the welfare of the deceased person or the deceased person's family, whether made before or after the deceased person's death, for which adequate consideration (not including any pension or other benefit) was not received, by the applicant,
(i) any provision made for the applicant by the deceased person, either during the deceased person's lifetime or made from the deceased person's estate,
(j) any evidence of the testamentary intentions of the deceased person, including evidence of statements made by the deceased person,
(k) whether the applicant was being maintained, either wholly or partly, by the deceased person before the deceased person's death and, if the court considers it relevant, the extent to which and the basis on which the deceased person did so,
(l) whether any other person is liable to support the applicant,
(m) the character and conduct of the applicant before and after the date of the death of the deceased person,
(n) the conduct of any other person before and after the date of the death of the deceased person,
(o) any relevant Aboriginal or Torres Strait Islander customary law,
(p) any other matter the court considers relevant, including matters in existence at the time of the deceased person's death or at the time the application is being considered."
It can be seen that s 60(2) enumerates 15 specific matters which the court may take into account, together with "any other matter the Court considers relevant", for the purposes of determining eligibility, whether to make a family provision order, and, if so, the nature of any such order. The section does not prioritise the catalogue of matters that may be taken into account. No matter is more, or less, important than any other. The weight of such of the matters specified in the section, which may be taken into account, will depend upon the facts of the particular case. There is no mandatory command to take into account any of the matters enumerated. None of the matters listed is, necessarily, of decisive significance, and none differentiate, in their application, between classes of eligible person. Similarly, there is no distinction based on gender.
Considering each of the relevant matters does not prescribe a particular result, and whilst there is likely to be a substantial overlap in the matters that the court may take into account when determining the answers to what is posed in s 60(1), those matters are not identical. For example, when considering eligibility under sub-s (1)(a), many of the matters in sub-s (2) will be largely, if not wholly, irrelevant.
There is no definition in the Act of "financial resources" (which term is referred to in s 60(2)(d)). However, there is a definition of that term in s 3 of the Property (Relationships) Act 1984, which I consider helpful:
"'financial resources' ... includes:
(a) a prospective claim or entitlement in respect of a scheme, fund or arrangement under which superannuation, retirement or similar benefits are provided,
(b) property which, pursuant to the provisions of a discretionary trust, may become vested in or used or applied in or towards the purposes of the parties ...,
(c) property, the alienation or disposition of which is wholly or partly under the control of the parties to the relationship or either of them and which is lawfully capable of being used or applied by or on behalf of the parties to the relationship or either of them in or towards their or his or her own purposes, and
(d) any other valuable benefit."
Of course, sub-s (2)(d) refers also to "earning capacity", which means no more than the capacity to find employment to earn or derive income.
Consideration of some of the matters in s 60(2) not only permits, but requires, a comparison to be made between the respective positions of the applicant and of other eligible persons as well as of the beneficiaries, whilst others do not. Importantly, also, many of the matters in sub-s (2), of themselves, are incapable of providing an answer to the questions posed in s 60(1).
Leaving aside the question of eligibility, the matters referred to in s 60(2) may be considered on "the discretionary question", namely whether to make an order and the nature of that order. Importantly, under s 60(2), attention is drawn to matters that may have existed at the time of the deceased's death, or subsequently.
This does not mean, however, that some of the matters referred to in s 60(2) will not be relevant to the jurisdictional question to be determined at the first stage. Happily, I am not alone in reaching this conclusion which is supported by the following comments made in Singer v Berghouse (at 209-210):
"... The determination of the first stage in the two-stage process calls for an assessment of whether the provision (if any) made was inadequate for what, in all the circumstances, was the proper level of maintenance etc appropriate for the applicant having regard, amongst other things, to the applicant's financial position, the size and nature of the deceased's estate, the totality of the relationship between the deceased and other persons who have legitimate claims upon his or her bounty.
The determination of the second stage, should it arise, involves similar considerations. Indeed, in the first stage of the process, the court may need to arrive at an assessment of what is the proper level of maintenance and what is adequate provision, in which event, if it becomes necessary to embark upon the second stage of the process, that assessment will largely determine the order which should be made in favour of the applicant."
And by the comments of Callinan and Heydon JJ in Vigolo v Bostin (at 230-231):
"We do not therefore think that the questions which the court has to answer in assessing a claim under the Act necessarily always divide neatly into two. Adequacy of the provision that has been made is not to be decided in a vacuum, or by looking simply to the question whether the applicant has enough upon which to survive or live comfortably. Adequacy or otherwise will depend upon all of the relevant circumstances, which include any promise which the testator made to the applicant, the circumstances in which it was made, and, as here, changes in the arrangements between the parties after it was made. These matters however will never be conclusive. The age, capacities, means, and competing claims, of all of the potential beneficiaries must be taken into account and weighed with all of the other relevant factors."
Section 61 of the Act permits the court to disregard the interests of any other person by, or in respect of whom, an application for a family provision order may be made (other than a beneficiary of the deceased person's estate), but who has not made an application. However, the court may disregard any such interests only if:
(a) notice of the application, and of the court's power to disregard the interests, is served on the person concerned, in the manner and form prescribed by the regulations or rules of court, or
(b) the court determines that service of any such notice is unnecessary, unreasonable or impracticable in the circumstances of the case.
Section 65(1) of the Act requires the family provision order to specify:
(a) the person or persons for whom provision is to be made, and
(b) the amount and nature of the provision, and
(c) the manner in which the provision is to be provided and the part or parts of the estate out of which it is to be provided, and
(d) any conditions, restrictions or limitations imposed by the court.
The order for provision out of the estate of a deceased person may require the provision to be made in a variety of ways, including a lump sum, periodic sum, or "in any other manner the court thinks fit" (s 65(2) of the Act). If the provision is made by payment of an amount of money, the order may specify whether interest is payable on the whole, or any part, of the amount payable for the period, and, if so, the period during which interest is payable and the rate of interest (s 65(3) of the Act).
The order may be made, relevantly, in this case, in relation to the estate of the deceased. As the deceased died leaving a Will, her estate includes all property that would, on a grant of probate of the Will, vest in the executors of the Will (s 63 of the Act).
Any family provision order under the Act will take effect, unless the Court otherwise orders, as if the provision was made in a codicil to the will of the deceased, or in the case of intestacy, as in a will of the deceased (s 72(1) of the Act).
Section 66 of the Act sets out the consequential and ancillary orders that may be made.
The Court, also, may, at the time of distribution of an estate that is insufficient to give effect to a family provision order, make such orders concerning the abatement, or adjustment, of distributions from the estate, as between the person in whose favour the family provision order is made and the other beneficiaries of the estate as it considers to be just and equitable among the persons affected (s 72(2) of the Act).
Section 99 of the Act provides that the Court may order the costs of proceedings in relation to the estate, or notional estate, of the deceased (including costs in connection with mediation) to be paid out of the estate or notional estate, or both, in such manner as the Court thinks fit.
Other Applicable Legal Principles - Substantive Application
Accepting that no two cases will be exactly alike, there are some general principles that may be stated. Whilst most of these principles were given in the context of the previous legislation, they are equally apt in a claim such as this one.
Bryson J noted in Gorton v Parks (1989) 17 NSWLR 1, at 6, that it is not appropriate, to endeavour to achieve a "fair" disposition of the deceased's estate. It is not part of the Court's function to achieve some kind of equity between the various claimants. The Court's role is not to reward an applicant, or to distribute the deceased's estate according to notions of fairness or equity. Nor is the purpose of the jurisdiction conferred by the Act the correction of the hurt feelings, or sense of wrong, felt by an applicant. Rather, the Court's role is of a specific type and goes no further than the making of 'adequate' provision in all the circumstances for the 'proper' maintenance, education and advancement in life of an applicant.
In Cooper v Dungan (1976) 50 ALJR 539, Stephen J, at 542, reminded the Court to be vigilant in guarding "against a natural tendency to reform the testator's will according to what it regards as a proper total distribution of the estate rather than to restrict itself to its proper function of ensuring that adequate provision has been made for the proper maintenance and support of an applicant". Freedom of testamentary disposition is not to have "only a prima facie effect, the real dispositive power being vested in the court": Pontifical Society for the Propagation of the Faith v Scales [1962] HCA 19; (1962) 107 CLR 9, at 19.
In Stott v Cook (1960) 33 ALJR 447, Taylor J, although dissenting in his determination of the case, observed, at 453-4, that the Court did not have a mandate to rework a will according to its own notions of fairness. His Honour added:
"There is, in my opinion, no reason for thinking that justice is better served by the application of abstract principles of fairness than by acceptance of the judgment of a competent testator whose knowledge of the virtues and failings of the members of his family equips him for the responsibility of disposing of his estate in far better measure than can be afforded to a Court by a few pages of affidavits sworn after his death and which only too frequently provide but an incomplete and shallow reflection of family relations and characteristics. All this is, of course, subject to the proviso that an order may be made if it appears that the testator has failed to discharge a duty to make provision for the maintenance, education or advancement of his widow or children. But it must appear, firstly, that such a duty existed and, secondly, that it has not been discharged."
Yet, in considering the question, the nature and content of what is adequate provision for the proper maintenance, education and advancement in life of an applicant, is not fixed or static. Rather, it is a flexible concept, the measure of which should be adapted to conform with what is considered to be right and proper according to contemporary accepted community standards: Pontifical Society for the Propagation of the Faith v Scales at 19; Walker v Walker (NSWSC, Young J, 17 May 1996, unreported); Vigolo v Bostin at 199 and 204; Stern v Sekers; Sekers v Sekers [2010] NSWSC 59.
In all cases under the Act, what is adequate and proper provision is necessarily fact specific.
The Act is not a "Destitute Persons Act", and it is not necessary, therefore, that the applicant should be destitute to succeed in obtaining an order: In re Allardice, Allardice v Allardice (1909) 29 NZLR 959 at 966.
Where the Court is satisfied that provision ought to be made, then it is no answer to a claim for provision under the Act that to make an order would be to defeat the intentions of the deceased identified in the Will. The Act requires, in such circumstances, for the deceased's intention in the Will to be displaced: Kembrey v Cuskelly [2008] NSWSC 262, per White J, at [45].
All of the financial needs of an applicant have to be taken into account and considered by reference to the other factors referred to in the Act and in Singerv Berghouse. What is proper provision is not arrived at by adding up all of the identified financial needs: Hyland v Burbidge [2000] NSWSC 12 at [56]. Nor does it follow that if the Court decides it is inappropriate to make a specific provision in respect of one identified head of claim that any identified financial need, even a contingent need, in relation to that claim becomes irrelevant to the final assessment: Mayfield v Lloyd-Williams.
What was said in Edgar v Public Trustee for the Northern Territory [2011] NTSC 5, per Kelly J at [46] should be remembered:
"There is no onus on the ... residuary beneficiary under the will to show that she is entitled to be treated as such - or to prove what may be necessary for her proper maintenance and support. Rather the onus is on the plaintiff to show that proper provision is not available for him under the terms of the will. In determining whether this is the case the Court must have regard to all relevant circumstances including the size of the estate and the nature of the competing claim by the widow. In performing this task the Court must have due regard to the will of the testator and should interfere only to the minimum extent necessary to make adequate provision for the proper maintenance, education and advancement in life of an applicant who has passed the first jurisdictional hurdle. As Dixon CJ said in the passage from Scales quoted above, due regard must be had to "what the testator regarded as superior claims or preferable dispositions" as demonstrated by his will." (Omitting citations)
In relation to a claim by a grandchild, the following general principles are, in my view, relevant and should be remembered:
(a) As a general rule, a grandparent does not have an obligation or responsibility to make provision for a grandchild; that obligation rests on the parent of the grandchild. Nor is a grandchild, normally, regarded as a natural object of the deceased's testamentary recognition.
(b) Where a grandchild has lost his, or her, parents at an early age, or when he, or she, has been taken in by the grandparent in circumstances where the grandparent becomes a surrogate parent, these factors would, prima facie, give rise to a claim by a grandchild to be provided for out of the estate of the deceased grandparent. The fact that the grandchild resided with one, or more, of his, or her, grandparents is a significant factor. Even then, it should be demonstrated that the deceased had come to assume, for some significant time in the grandchild's life, a position more akin to that of a parent than a grandparent, with direct responsibility for the grandchild's support and welfare, or else that the deceased has undertaken a continuing and substantial responsibility to support the applicant grandchild financially or emotionally.
(c) The mere fact of a family relationship between grandparent and grandchild does not, of itself, establish any obligation to provide for the grandchild upon the death of the grandparent. A moral obligation may be created, in a particular case, by reason, for example, of the care and affection provided by a grandchild to his, or her, grandparent.
(d) It has been said that a pattern of significant generosity by a grandparent, including contributions to education, does not convert the grandparental relationship into one of obligation to the recipients, as distinct from one of voluntary support, generosity and indulgence.
(e) The fact that the grandparent occasionally, or even frequently, made gifts to, or for, the benefit of the grandchild does not, in itself, make the grandchild wholly, or partially, dependent on the grandparent for the purposes of the Act.
(f) The grandchild's dependence, whether whole or partial, on the grandparent must be direct and immediate; it is not sufficient that the grandchild's dependence is the indirect result of the deceased providing support and maintenance for his, or her, own adult child, and thereby, incidentally, benefiting the deceased's grandchildren who are directly dependent on that child.
(g) It is relevant to consider what inheritance, or financial support, a grandchild might fairly expect from his, or her, parents. Yet, the obligation of a parent to provide for his, or her child does not, necessarily, negate, in an appropriate case, the moral obligation of a grandparent to make provision for the maintenance, education or advancement in life of a grandchild out of her, or his, estate.
(h) The fact that the parents, or either of them, of a grandchild have, or has, predeceased the grandparent may be a relevant factor in support of the claim made by a grandchild.
The authorities that provide the basis for the above summary, include Tsivinsky v Tsivinsky; Sayer v Sayer [1999] NSWCA 340; Shaw v Shaw [2003] VSC 318; (2003) 11 VR 95; O'Dea v O'Dea [2005] NSWSC 46; Re Estate of Hakim; Simons v Permanent Trustee Co Ltd. I set these principles out, recently, in Bowditch v NSW Trustee and Guardian [2012] NSWSC 275 at [113].
By way of example, relevant to the present case, in Pearson v Jones [2000] NSWSC 799, there were grandchildren who lived with their parents in part of the house that was owned by the grandparents. From time to time, the grandparents made various gifts to the grandchildren. Master McLaughlin (as his Honour then was) concluded on this aspect:
"24 It was submitted on behalf of the Plaintiffs that practical and financial assistance by the Deceased of the nature which I have herein described constituted partial dependency by each Plaintiff upon their grandparents and, after the death of their grandfather, upon the Deceased.
25 However, I am of the view that where, as here, the Plaintiffs were residing with their own parents, and where it was their own parents who had the primary responsibility for the maintenance, care and support of the Plaintiffs, the mere facts that gifts or benefits were given, either occasionally, or even on a regular basis, by the grandparents is not sufficient to establish that the Plaintiffs were partly dependent upon their grandparents."
Because it has been raised as a basis for part of Richard's claim, I point out that if an applicant has an obligation to support others, such as a parent's obligation to support a dependent child, that will be a relevant factor in determining what is an appropriate provision for the maintenance of the applicant: Re Buckland Deceased [1966] VR 404 at 411; Hughes v National Trustees Executors and Agency Co. of Australasia Ltd (1979) 143 CLR 134 at 148; Goodman v Windeyer at 498, 505. The Act does not however permit orders to be made to provide for the support of third persons whom the applicant, however reasonably, wishes to support, where there is no obligation to support such persons: Re Buckland Deceased at 411; Kleinig v Neal (No 2) (1981) 2 NSWLR 532 at 537; Mayfield v Lloyd-Williams, at [86].
I make clear that I do not intend what I have described as "applicable principles" or "general principles" to be elevated into rules of law. Nor do I wish to suggest that the jurisdiction should be unduly confined or the discretion at the second stage to be constrained by statements of principle found in dicta in other decisions. I identify them merely as providing useful assistance in considering the statutory provisions, the terms of which must remain firmly in mind.
Relevant Facts
I set out below the additional facts I am satisfied are either not in dispute, or that, in my view, have been established by the evidence. I do so by reference to s 60 of the Act.
(a) any family, or other, relationship between the applicant and the deceased person, including the nature and duration of the relationship
The word "family" is not defined in the Act. However, there is no dispute that Richard is a grandchild of the deceased and, thus, part of her "family".
Richard says that he lived with Margo, his father, his brother, John, as well as, on occasions, with his grandfather, in a house, in Botany, owned by his grandfather and the deceased.
He says that the deceased regularly helped his mother. It was the deceased, after she retired, who would take him and John to school, when they were in primary school (at least up to year 6, which was in 1988). They would regularly go to the deceased's home on weekends until he was about 15 years old. The deceased would take Richard and John out with her to such places as the beach and to the Easter Show. They would go on holidays together, every year for about five years.
Richard also gave the following evidence in his affidavit, about which evidence he was not cross-examined:
"Nan did much more for me than let me and my family move into the Botany house. From as long back as I am able to remember, I saw Nan virtually every day. As a child, she fed me, she nurtured me, and she nursed me and cuddled me. She bought me clothes. She was always there to listen to me when I had a problem and was always there to comfort me when I was upset. I would frequently spend the afternoons at her place after school. I would be at her place virtually every Saturday and every Sunday. Without her buying John and I clothes, we would have not had warm clothes in winter or tidy clothes to go out in."
Richard and John would visit the deceased weekly until each was about 15 years old. They would visit every Christmas, Easter and on birthdays until about 2003. Thereafter, because of the geographical distance between the deceased's, and Richard's, home, and also because of his work commitments, visits were less frequent, but he says they remained regular. He would visit her every couple of months, although he would speak with her on the telephone more often.
Frank gives evidence that the visits were less often. Whilst he admits that he was not at the retirement village with the deceased, he says that she would tell him when he saw her who had visited.
I tend to think that Richard exaggerated how often he visited the deceased after 2003. I also consider that he may have visited the deceased less often after the death of Margo. This is demonstrated by the evidence regarding the deceased's complaints, which cannot be disputed, about how irregularly Richard and John visited her after 2003 and explains her desire to make no provision for each of them following the death of Margo.
In reaching this conclusion, I do not doubt that Richard would telephone the deceased, or that he went to visit her, as often as he could. No doubt because of the tyranny of distance, and his own busy life, this was less often than either would have liked. This is hardly surprising, particularly over early adult years when a grandchild is seeking to make his, or her, own life, and in circumstances where another, being the child of the grandparent, is able to provide assistance and companionship to the deceased. In this case, Frank and Jann could provide this assistance and Richard knew this.
There is nothing to suggest that Richard's relationship with the deceased was not happy, loving, warm, or harmonious, at least until 2003. I am satisfied that Richard was a loving grandchild to the deceased. Thereafter, whilst he may not have seen her as often as he had when they lived close to each other, I do not doubt that Richard maintained his affection for the deceased throughout her life.
Nor is it surprising that the deceased was disappointed that she was not seeing as much of him as she had previously. This disappointment, in my view, confirms the closeness of their relationship before 2003.
(b) the nature and extent of any obligations or responsibilities owed by the deceased person to the applicant, to any other person in respect of whom an application has been made for a family provision order or to any beneficiary of the deceased person's estate
There is no definition of the "obligations" or "responsibilities" to which the sub-section refers in the Act. One might conclude, however, that what is to be considered is the nature and extent of any legal, or moral, obligations or responsibilities.
Other than any obligation, or responsibility, arising under the Act as a result of their relationship as grandparent and grandchild, the deceased did not have any legal, or financial, obligation to Richard, imposed upon her by statute or common law.
The deceased did assume obligation and responsibility, towards Richard when he was a child. However, there is no suggestion, during these periods, that Margo was abrogating her responsibility to her own children, as their mother, that the deceased had taken over the direct responsibility for their support or welfare, or that she had undertaken a continuing and substantial responsibility to support each financially.
Leaving aside any obligation, or responsibility, arising as a result of their relationship as parent and child, the deceased did not have any legal obligation to Frank, imposed upon her by statute or common law. However, a moral obligation or responsibility, to make adequate provision for the proper maintenance or advancement in life is recognised in the case of a child. In this regard, it may fairly be said that a grandparent does not owe the same kind of obligation or responsibility to her, or his, grandchildren as she, or he, does to her, or his, own children.
The deceased did not have any legal, or financial, obligation to Jann, imposed upon her by statute or common law. She was related to the deceased by marriage, being her daughter-in-law. However, it was a close relationship for much of the period of Jann's marriage to Frank.
(c) the nature and extent of the deceased person's estate (including any property that is, or could be, designated as notional estate of the deceased person) and of any liabilities or charges to which the estate is subject, as in existence when the application is being considered
I have dealt with this earlier in this judgment. On any view, the deceased's estate is not a large one.
(d) the financial resources (including earning capacity) and financial needs, both present and future, of the applicant, of any other person in respect of whom an application has been made for a family provision order or of any beneficiary of the deceased person's estate
Richard discloses the following assets:
Assets (estimated)
(a)
NAB account as at 10 July 2012:
$ 123
(b)
2000 Holden Commodore:
$ 2,050
(c)
Savage 13.5 Alumcraft boat:
$ 6,000
(d)
Superannuation:
$21,252
He works as a Warehouse Manager earning $48,000, plus superannuation ($4,320) per year. His wife's income is $78,715 gross per annum plus superannuation. He estimates the family's monthly expenditure, including loan repayments of $2,058 per month to be $4,927.
He states, in relation to his "needs":
"8.Should funds be made available for me from my Nan's estate I would utilise the funds for the following:
(a)I would put a substantial part of the funds towards the mortgage held over the property situated at xx/xx Manchester Road, GYMEA. This is my wife's house and I would like to contribute to this so that it will become our home. I am aware that the mortgage as at 15 June 2012 was $292,000.
(b)I require significant dental treatment, and I would utilise the funds I receive to attend to such treatment. Such treatment has an estimated cost of $6,090.
(c)Furniture within my home needs an upgrade and should funds be made available to me I would utilise these funds to purchase a new bed for my wife and I, a bed for my daughter and new dining and living furniture. I estimate that I would require $5,497 for the new items.
(d)Additionally I would need sufficient funds to clothe and educate our children. I will need a means of paying for day-to-day food and utility expenses and for transport. I estimate these, in current terms, will cost around $250 each week. I am informed by my solicitors and verily believe that the lump sum necessary to provide $250 to me each week for the next 52 year years until I reach an age of 85 years will be $246,225.
9.I am particularly concerned about the future as my wife will not be earning an income for the period that she is on maternity leave."
(The amount in (d) was increased to $279,360 in Richard's later affidavit.)
At the hearing, Richard's counsel accepted that the requirement to provide for his child, or children, until Richard was 85 years old was not required. He submitted that a capital sum between about $140,000 and $180,000 was a lump sum that would amount to adequate and proper provision for the Plaintiff.
There is no evidence of the financial resources (including earning capacity) and financial needs, both present and future, of the beneficiaries of the deceased person's estate. A letter dated 10 May 2012, from the Defendants' solicitors, to the Plaintiff's solicitors, stated, in this regard:
"We confirm that, whilst the defendants deny that your client is an eligible person, they will not be raising their financial circumstances (or adducing any evidence of it [sic]) as providing any competition to the plaintiff's claim on the basis of their needs."
There is no statutory mandate requiring a beneficiary, or beneficiaries, to provide such details of his, or her, financial circumstances to the Court. A beneficiary is entitled to elect to remain silent in relation to all matters, and in particular, as to his, or her, financial resources (including earning capacity) and financial needs, both present and future. In addition, as here, a beneficiary may expressly decline to submit that he, or she, has a competing financial need and provide no evidence of financial resources or needs.
Where, as in this case, the beneficiaries have declined to provide such evidence to the Court, the important question is what inference, if any, should be drawn from the beneficiaries' silence?
In the present case, the beneficiaries are parties to the proceedings. Thus, the Court may assume that they do not wish their financial resources (including earning capacity) and financial needs, both present and future, to be taken into account: Matthews v Wear [2011] NSWSC 1145, at [45], per Macready AsJ.
The question, then, is what flows from a beneficiary's silence? The answer is, in those circumstances, that the court is entitled to infer that the beneficiary has adequate resources upon which to live and that he, or she, does not wish to advance a competing financial claim upon the bounty of the deceased: Anderson v Teboneras [1990] VicRp 47; [1990] VR 527 at 535, per Ormiston J; Frey v Frey (as personal representatives of the estate of HE Frey, dec'd) [2009] QSC 43, at [148], per A Lyons J; Edgar v Public Trustee for the Northern Territory, at [54], per Kelly J; Neil v Jacovou [2011] NSWSC 87 at [248] per Slattery J; Haklany v Gittany [2011] NSWSC 1549 at [49] - [51] per Slattery J; Hyatt v Covalea [2011] VSC 334, at [128], per Zammitt AsJ; Davis v Davis [2012] NSWSC 201, at [80], per Slattery J; Paola v State Trustees Ltd [2012] VSC 158, at [46], per Zammitt AsJ; and Collins v Mutton [2012] NSWSC 548.
However, the claims of a beneficiary, as the chosen object of the deceased's testamentary bounty, or as a person with a legitimate claim on the bounty of the deceased, and also as a person whose interest in the estate may bear the burden of the order made in favour of the applicant, are to be borne in mind. (It is to be remembered that the Court must specify, amongst other things, the manner in which the provision is to be provided and the part, or parts, of the estate out of which it is to be provided: s 65(1)(c) of the Act.)
Where there is no evidence from the beneficiary, it is those claims (i.e. as the chosen object of the deceased's testamentary bounty, or as a person with a legitimate claim on the bounty of the deceased, or as a person whose interest in the estate may bear the burden of the order made in favour of the applicant), rather than any financial claim upon the bounty of the deceased, that should be considered. Put another way, and using the oft-quoted words of Salmond J in Re Allen (deceased); Allen v Manchester [1922] NZLR 218, at 220, the Court is not able to have regard to "the means" of the beneficiary, but the Court may still consider "the deserts of the several claimants" and the "relative urgency" of the various moral claims upon [the deceased's] bounty".
The Court will, thereby, give due regard to "what the testator regarded as superior claims or preferable dispositions" as demonstrated by his, or her, will: Pontifical Society for the Propagation of the Faith v Scales at 19, per Dixon CJ. In this way, too, the Court gives weight to the principle of freedom of testation referred to earlier.
(e) if the applicant is cohabiting with another person - the financial circumstances of the other person
Richard lives with the following people:
Name of person
Relationship
Is the person dependant?
Age (if under 18 years)
Ann
Wife
Yes
Olivia Grace
Daughter
Yes
20 months
His wife, Ann's, assets are as follows:
(a)
Townhouse at Gymea:
$515,000
(b)
Home loan offset:
$240,174
(c)
Credit Union account:
$ 634
(d)
Westpac Account:
$ 1,369
(e)
2009 Mazda 2:
$ 12,000
(f)
Superannuation:
$ 62,688
Since July 2011, the mortgage debt has been reduced from $314,000 to $292,000. That is the current mortgage debt on the Gymea property. That has been achieved by payments from her and Richard's combined earnings and also because of the money in the Home loan offset account.
The amount in the Home loan offset account is not hers, but rather belongs to her parents. They have given evidence, on which they were not cross-examined, that Ann is not entitled to the capital and that the funds belong to them. Ann "is not entitled to utilise these funds as they have been solely placed in the account to assist with the minimisation of interest" in respect of mortgage repayments.
Ann is expecting their second child and anticipates ceasing work, for 12 months, from early December 2012. Her only income then will be what she receives by way of the Australian Government's baby bonus. She is not entitled to any maternity leave payments from her employer whilst she is not working.
(f) any physical, intellectual or mental disability of the applicant, any other person in respect of whom an application has been made for a family provision order or any beneficiary of the deceased person's estate that is in existence when the application is being considered or that may reasonably be anticipated
Richard says his health is average. He is currently on medication for depression and stomach ulcers.
(g) the age of the applicant when the application is being considered
Richard is currently 34 years of age, having been born in July 1978.
(h) any contribution (whether financial or otherwise) by the applicant to the acquisition, conservation and improvement of the estate of the deceased person or to the welfare of the deceased person or the deceased person's family, whether made before or after the deceased person's death, for which adequate consideration (not including any pension or other benefit) was not received, by the applicant
Taking contributions into account is not a principle of reward and should not be permitted to degenerate into such a principle.
Richard does not identify any financial, or other, contributions to the acquisition of the estate of the deceased. He does give evidence, as does Ann, of contributions to the conservation and improvement of the Botany property.
Furthermore, I accept that when he visited the deceased, or when she visited him, he contributed, as a grandchild, to the deceased's welfare. This is demonstrated by the reference in the evidence to Richard and John as "her boys".
(i) any provision made for the applicant by the deceased person, either during the deceased person's lifetime or made from the deceased person's estate
During her lifetime, the deceased provided accommodation for Margo and her family, which, of course, included Richard. He also says that the deceased paid for his school uniforms and other things but the frequency and amount of this assistance is not detailed.
The deceased made no specific provision for Richard in the Will. However, had Margo survived the deceased, but died subsequently, some provision may have been made.
(j) any evidence of the testamentary intentions of the deceased person, including evidence of statements made by the deceased person
There is no evidence of the testamentary intentions of the deceased other than her Will, in respect of which Probate was granted.
However, Frank gives evidence that the deceased asked him to take her to the offices of her solicitor, A J Apps & Associates, at Camden, to "change my Will to make sure [Richard and John] don't get anything". He took her on two occasions and he sat with her during conferences with Mr Apps, during which time he said words to the effect "You don't have to change your Will. They would have got something if the Botany house had still been yours at the time of your death but that has been sold and so they get nothing. Nil. Zip". (These occasions occurred following the death of Margo.)
Mr Apps did not give evidence of any conversation with the deceased.
(k) whether the applicant was being maintained, either wholly or partly, by the deceased person before the deceased person's death and, if the court considers it relevant, the extent to which and the basis on which the deceased person did so
The deceased did not maintain Richard, either wholly or partly, before her death (other than as set out above). There is no suggestion that she maintained Margo or Richard at any time after 2003.
(l) whether any other person is liable to support the applicant
Apart, perhaps, from his wife, Ann, there is no other person liable to support Richard.
(m) the character and conduct of the applicant before and after the date of the death of the deceased person
An evaluation of "character and conduct" may be necessary, not for the sake of criticism, but to enable consideration of what is "adequate and proper" in all the circumstances. The Act does not limit the consideration of "conduct" to conduct towards the deceased. Nor is it limited to character or conduct of the applicant such as to disentitle him, or her, to the benefit of any provision. In referring to character and conduct of an applicant, the Act also contemplates good conduct as it would constitute an injustice if such a factor were not taken into account.
I have dealt with the relationship of Richard and the deceased earlier in these reasons. There is nothing to suggest any conduct of the type towards the deceased that might disentitle Richard to relief under the Act. To the contrary, at least until 2003, Richard's conduct towards the deceased was exemplary. Thereafter, he might not have seen her as much as either would have wanted, but I do not think that he can be criticised for this.
(n) the conduct of any other person before, and after, the date of the death of the deceased person
There is some evidence of each Defendant's conduct towards the deceased. I remember that each is a chosen object of the testamentary bounty of the deceased.
(o) any relevant Aboriginal or Torres Strait Islander customary law
This is not relevant in the present case.
(p) any other matter the court considers relevant, including matters in existence at the time of the deceased person's death or at the time the application is being considered
There is only one other relevant matter that might be considered. The likelihood is that since Richard's father has been working rarely since the 1980s, he will not be able to make any provision for Richard out of his estate. The provision made for Richard, by Margo, was relatively modest. The deceased might have recognised that some specific provision should be made for Richard because his father, in the future, could not be relied upon to make adequate provision for Richard's proper maintenance, education or advancement in life.
Determination
I have had the benefit of receiving a written outline of submissions from counsel for the respective parties. Those documents will be retained in the Court file.
Eligibility
There is a dispute about the eligibility of Richard. This dispute is limited to whether he was wholly, or partly, dependent upon the deceased, since there cannot be any dispute that he is a grandchild of the deceased. It is enough for Richard to establish that he was wholly, or partly, dependent upon the deceased at any "particular time". In this case, only partial dependency, both financial and emotional, is relied upon.
It seems clear that the deceased, when Margo was at work, assisted in looking after, and caring for, Richard and John. She would, often, during the period of about two or three years in the 1980s, take them to school, when their mother was at work. She collected them from school when Margo could not do so because she was working and they would stay with her sometimes after school. In this way, the deceased assisted in looking after Richard and John where each, himself, was incapable of doing so by reason of his age; where their father was not in a position, or did not wish, to do so; and whilst their mother was engaged in employment as the sole breadwinner of the family.
(Richard gave evidence that his father, who was not working, at various times in this period, did not assist in doing what the deceased did. In fact, Richard states that "most of the support that John and I received came from Mum and [the deceased]". It was not to her husband that Margo turned for assistance but to the deceased.)
In doing what she did, the deceased assisted in allowing Margo to go to work. Carrying out the childcare tasks that enabled Margo to work, counted as the deceased providing assistance to Richard and John, as well as to Margo.
It was also the deceased who would take Richard and John to some social events, such as Christmas parties at South's Juniors, to the beach, and on holidays to Forster, with Margo, to visit the deceased's sister. They would, with Margo, spend birthdays and other special occasions together.
Richard also did give evidence that he looked to the deceased to provide him with some care and mothering. But he does not suggest that Margo abrogated her parental responsibilities to him, or that the deceased took over the role as a surrogate parent to him. He also gives some evidence that the deceased provided him with emotional support and succour. It is equally clear, however, that it was Margo who was his principal caregiver and the person who had the principal responsibility for his maintenance, care and support.
Richard did not suggest that he ever was in the custody of the deceased other than on the occasions that I have mentioned and, only then, whilst Margo was at work. He does not suggest that he ever lived with the deceased, or that she ever lived with him and his family, in the Botany property. The deceased appears to have visited the Botany property for the limited purposes of providing assistance to Margo who was at work.
There is evidence that the deceased provided payment for his school uniforms, paid for some excursions, and bought him a meal after school when she had collected him. In relation to the former two matters, the evidence is extremely vague and is incapable of being tested. In relation to the latter, it was not of such significance that one could say that it was more than minimal, even if it was provided almost daily when Margo was working and when the deceased collected Richard from school. His knowledge about these matters was based, not upon his own knowledge, but upon "[J]ust overhearing what they were saying when they were talking".
In any event, none of these financial matters demonstrates that the deceased had clearly assumed a continuing and substantial responsibility for Richard's support and welfare. I tend to the view that the financial assistance provided by the deceased was to Margo rather than to Richard.
I am also satisfied that, until at least 2003, there was a close relationship and emotional bond between the deceased and Richard. He was not cross-examined on the specific passage of his evidence that I have quoted at [116] above. There is no reason not to accept that evidence.
The most significant matter on the question of dependency, it seems to me, however, is that the deceased, whilst she may have done what she did to assist Margo, did so, it would appear, because Richard's father did not. In this respect, since he was not working, he might have been the natural person to provide the assistance to Margo that the deceased did. He might have also been the natural person on whom Richard would depend if he needed assistance and if Margo was not immediately available. However, that does not appear to be, in fact, what happened. It was the deceased who provided that assistance and to whom Richard appears to have turned in those circumstances.
Whilst this is a borderline case, I am satisfied that Richard was partly dependent upon the deceased. As a partly dependent grandchild of the deceased, he is an eligible person within the meaning of the Act.
Factors warranting the making of the Application
Having reached the conclusion that Richard is an eligible person, I turn next to consider whether there are any factors which warrant the making of his application.
No submissions, in writing, were made on behalf of Richard regarding this aspect of her and his case. However, he orally submitted that there were such factors, including that Richard and John was each explicitly named in the Will of the deceased as a substitute beneficiary. The Defendants submit that there were no factors warranting the making of their application.
I disagree with the Defendants' submission on this topic. I am satisfied that there are factors warranting the making of the application. There was a personal relationship and emotional bond between Richard and the deceased. Prior to 2003, it seems that it was closer than what might be suggested to be a usual grandparent and grandchild relationship. This is demonstrated by the deceased's significant disappointment in not seeing Richard as often as she had done, prior to her moving to the retirement village at Camden South. It is the disappointment that appears to have motivated the deceased to tell Frank that she did not want Richard or John to receive anything out of her estate and to exclude them from receiving any provision.
Furthermore, I consider that a wise and just testator, looking at the family line, and considering the loss of Richard's mother, might conclude that she had a moral obligation, in the particular circumstances, to make some provision for Richard's future needs, particularly since the provision made by Margo for him was relatively modest and the likelihood was that Richard would not receive any, or any substantial, inheritance from his own father.
Furthermore, the deceased must have appreciated that by not changing her Will, Richard lost the benefit of the inheritance that might have come to his mother from the deceased and that might then have come to him had she survived the deceased. Had Margo not predeceased the deceased, Richard might have taken the benefit of part of the deceased's estate if such other provision was made for Margo in the Will.
I note that the substitutionary gift in the deceased's Will is not to the class of grandchildren of the deceased but that it specifically names Richard and John. This demonstrates, in my view, that the deceased appreciated that if Margo predeceased her, then Richard and John were appropriate beneficiaries to receive a share of her estate.
It follows that I am satisfied that there are factors warranting the making of Richard's application.
Having determined eligibility and factors warranting the making of his application, I next note that Richard's proceedings were commenced within the time prescribed by the Act.
The next question for determination, then, is whether, at the time when the court is considering the application, adequate provision for Richard's proper maintenance or advancement in life, has not been made, by the Will of the deceased, or by the operation of the intestacy rules in relation to the estate of the deceased, or both. (The intestacy rules are irrelevant in this case.)
Of course, there is no provision made for Richard in the Will of the deceased. In considering the answer to the question posed at the first stage, judged by quantum and looked at through the prism of his, financial and material circumstances, adequate provision for his proper maintenance or advancement in life was not made by the Will of the deceased. Whilst he and his wife are young and able bodied, whilst they have secure accommodation, which is subject to a mortgage, the repayments which they appear able to meet (with the assistance of Ann's parents' Home offset account), Richard has no assets, of any substantial value, of his own. Most importantly, he has no fund available for exigencies of life.
Whilst a lump sum, for maintenance or advancement in life would be appropriate, that is not all that I am required to consider at the first stage. The totality of the relationship of the applicant and the deceased, the age and capacities of the other beneficiaries, the Defendants, and their claim on the bounty of the deceased, are very relevant factors in determining the answer at the first stage.
I bear in mind that the Defendants are competing claimants upon the bounty of the deceased. I infer that each does not assert that he, or she, is a claimant with a competing financial claim and I infer that his and her resources are sufficient to meet his and her needs.
All the considerations lead me to find that there was a failure, on the part of the deceased, to make adequate provision for the proper maintenance or advancement in life for the Plaintiff.
In determining the quantum of provision, if any, a grandchild stands in his, or her, own right as a claimant on the bounty of the deceased. He, or she, does not take the place of a deceased parent in terms of a grandparent's moral duty. It follows that what was provided for Richard and John, as substitute beneficiaries for their mother, Margo, is not of significance in determining the provision that ought to be made for Richard by way of a family provision order.
The determination of what provision should be made cannot be done by exact calculation or computation and must, at least in part, depend upon an estimate of the needs of the applicant.
I am not satisfied that the quantum of provision that Richard submits as his primary case, namely that he should receive a lump sum of between about $140,000 and $180,000, should be made for him. Nor do I accept that the Court should be so mean as to provide him with a lump sum of $30,000 (as was submitted by the Defendants if eligibility and factors warranting were established), particularly in circumstances where the beneficiaries intentionally do not put forward evidence of their financial resources.
Taking into account all of the circumstances of the case, including the nature and value of the estate, the nature of the relationship of Richard and the deceased, both before and after 2003, his financial resources (including earning capacity) and financial needs, both present and future, as well as the competing claims of the Defendants as the chosen objects of the deceased's bounty, I am of the view that he should receive a lump sum of $96,500 out of the estate of the deceased. After he pays for his dental treatment and for furniture (about $11,500 in total), he will have about $85,000 (subject to payment of the difference between ordinary and indemnity costs) that he can retain for exigencies of life.
The amount will provide a small additional income also to supplement his modest income, particularly whilst Ann is not working.
I make the following orders:
(i) Having found that the Plaintiff, Richard Anthony Sammut, is an eligible person, that there are factors which warrant the making of his application and that the provision made for him in the Will of the deceased is inadequate for his proper maintenance or advancement in life, order that he is to receive a lump sum of $96,500 out of the estate of the deceased.
(ii) Order that the burden of the provision made for the Plaintiff, should be borne out of the residuary estate of the deceased by the Defendants equally.
(iii) Order that no interest is to be paid on the lump sum if that lump sum is paid within 14 days of the making of these orders; otherwise, interest calculated at the rate prescribed by s 84A(3) Probate and Administration Act 1898, on unpaid legacies, is to be paid from that date until the date of payment.
(iv) Order that the costs of all parties shall be determined after further submissions, unless agreement is reached between them.
(v) Order that the Exhibits should be dealt with in accordance with the Uniform Civil Procedure Rules 2005 following the determination of the costs of the proceedings.
(vi) Further consideration with respect to orders for the purpose of giving effect to the family provision order made in favour of the Plaintiff be reserved.
(vii) Stand the matter over to a convenient date to the parties and the court for any argument as to costs.
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Decision last updated: 05 September 2012
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