Schneider v Kemeny; Kemeny v Schneider

[2021] NSWSC 524

Supreme Court

New South Wales

• Amendment notes

Medium Neutral Citation:

Schneider v Kemeny; Kemeny v Schneider [2021] NSWSC 524

Hearing dates:

9 – 11 November 2020

Date of orders:

Parties to bring in minutes of order.

Decision date:

13 May 2021

Jurisdiction:

Equity

Before:

Rees J

Decision:

Family provision claim dismissed. Orders for possession.

Catchwords:

SUCCESSION – family provision – claim by second husband – disparity of assets on marriage – couple agreed to leave assets to their respective children – re-executed Wills on marriage to that effect – maintained separate finances – husband lived in wife’s property and paid half market rent and household expenses – wife diagnosed with melanoma – 10 year battle with disease – daughter and husband support wife in medical treatment – wife pays medical expenses and carers – daughter and husband provide some care – husband presses wife to change Will – wife makes Will leaving husband less than requested – marriage sours – husband makes Will leaving everything to his child – separation likely save for wife’s terminal illness – wife insists husband is “not my carer” – after wife’s death, husband retires and changes lifestyle – no evidence his assets insufficient – provision made adequate in the circumstances – no primacy ‘in fact’ – no issue of principle.

Legislation Cited:

Succession Act 2006 (NSW) ss 59, 60

Cases Cited:

Bladwell v Davis [2004] NSWCA 170

Burke v MetLife Insurance Ltd [2019] NSWSC 177

Friend v Brien [2014] NSWSC 613

Grey v Harrison [1997] 2 VR 359; [1996] VSC 74

Ikonomou v Panagopoulos [2017] NSWSC 1805

Luciano v Rosenblum (1985) 2 NSWLR 65

Marshall v Carruthers [2002] NSWCA 47

Megerditchian v Khatchadourian [2019] NSWSC 1870

Megerditchian v Khatchadourian [2020] NSWCA 229

Nicholls v Hall [2007] NSWCA 356

Olsen v Olsen (2019) 101 NSWLR 225; [2019] NSWCA 278

Page v Hull-Moody [2020] NSWSC 411

Radzyminski v Radzyminski [2008] NSWSC 239

Re Sylvester [1941] Ch 87

Sgro v Thompson [2017] NSWCA 326

Slack v Rogan (2013) 85 NSWLR 253; [2013] NSWSC 522

Smith v Moore [2020] NSWSC 1446

Starr v Miller [2021] NSWSC 426

Steinmetz v Shannon (2019) 99 NSWLR 687; [2019] NSWCA 114

Verzar v Verzar [2012] NSWSC 1380

Category:

Principal judgment

Parties:

Proceedings 2019/286823 (Family Provision)
Michael Schneider (Plaintiff)
Gabor Kemeny (Defendant)

Proceedings 2019/258836 (Possession)
Gabor Kemeny (Plaintiff)
Michael Schneider (Defendant)

Representation:

Counsel:
Proceedings 2019/286823 (Family Provision)
Mr M K Meek SC (Plaintiff)
Mr L Ellison SC (Defendant)

Proceedings 2019/258836 (Possession)
Mr L Ellison SC (Plaintiff)
Mr M K Meek SC (Defendant)

Solicitors:
Proceedings 2019/286823 (Family Provision)
MJM Lawyers (Plaintiff)
Diana Perla & Associates (Defendant)

Proceedings 2019/258836 (Possession)
Diana Perla & Associates (Plaintiff)
MJM Lawyers (Defendant)

File Number(s):

2019/286823 (Family Provision)
2019/258836 (Possession)

Judgment

1. HER HONOUR: This is a claim for family provision by a second husband. The deceased, Katherine (Kathy) Kemeny, died on 18 February 2019, aged 63, after a ten-year battle with melanoma. The plaintiff, Michael Schneider, is 66 years old. Although recently retired, the plaintiff was a solicitor practising in estate planning, including as an equity partner of Conway Maccallum Lawyers (later Diamond Conway) and a salaried partner of Bartier Perry. The plaintiff had been married to Ms Kemeny for 14 years when she died, although their relationship was in serious trouble and, were it not for Ms Kemeny’s terminal condition, the couple would likely have separated earlier.

2. On their marriage, the couple had a wide disparity of assets. The plaintiff had a Kirribilli apartment, subject to a mortgage. Ms Kemeny had two unencumbered properties: a Paddington terrace (later replaced by a Darlinghurst apartment), where the couple lived, and a rental property in Surry Hills. Both had children in high school, to whom they were each devoted. The plaintiff and Ms Kemeny intended to leave their Estates to their respective children, and communicated this to each other on their marriage, also re-executing Wills on their wedding day to this effect.

3. Financial arrangements between the couple during their married life were strictly defined. Ms Kemeny insisted that the plaintiff pay ‘rent’ of $500 a week plus half of household expenses. Ms Kemeny looked after the house whilst the plaintiff enjoyed the balance of his salary as he chose. Adherence to this arrangement was a recurring stressor in the marriage. As Ms Kemeny’s disease progressed, the plaintiff insisted that the ‘rent’ be paid into Ms Kemeny’s superannuation, being an arrangement which was likely to benefit him but caused financial stress to Ms Kemeny, who was incurring significant medical expenses. Ms Kemeny paid for her own carers.

4. By reason of the plaintiff’s professional speciality, he had well-developed views of what his wife should leave him in her Will being, essentially the Darlinghurst apartment. Ms Kemeny did not share his views but wished to leave as much of her Estate as possible to her children (the plaintiff also made Wills leaving his Estate wholly to his son, Patrick). This difference of opinion proved corrosive to their relationship, combined with the burdens of Ms Kemeny’s advancing disease. The plaintiff pressed his views to the end.

5. Anticipating that the plaintiff would make a claim on her Estate, Ms Kemeny sought and followed legal advice. In her final Will, Ms Kemeny appointed her first husband, Gabor Kemeny, as executor of her Estate. By her Will, Ms Kemeny left the plaintiff her BMW car, artworks and her superannuation (totalling some $103,000) together with a right to occupy the Darlinghurst apartment for six months after her death, rent free, together with a right to occupy the Surry Hills property for a further two years at half market rent. Ms Kemeny left the rest of her Estate to her two children in equal shares.

6. The plaintiff continued to live in the Darlinghurst apartment beyond the six month period, prompting Mr Kemeny to bring possession proceedings. The plaintiff considered the Surry Hills property (a warehouse apartment) unsuitable, in particular, as it lacked proximity to his yacht club in Rushcutters Bay and did not have sufficient room to accommodate his newly acquired hobby of oil painting. Ms Kemeny’s net estate comprises some $2.675 million, the primary asset being the Darlinghurst apartment, which is worth some $2.3 million.

7. For the reasons which follow, I have concluded that Ms Kemeny did make adequate provision for the proper maintenance, education or advancement in life of the plaintiff. The plaintiff may not consider the provision to be generous but it was entirely commensurate with the tenor of their relationship and their dealings with each other since its inception. This was not a traditional marriage and, having applied the considerations prescribed by section 60(2) of the Succession Act 2006 (NSW), the plaintiff did not have ‘primacy in fact’.

LEGAL PRINCIPLES

8. There was no dispute as to the law. The general principles applicable to family provision claims are set out in Page v Hull-Moody [2020] NSWSC 411 at [120]-[159] per Hallen J and Smith v Moore [2020] NSWSC 1446 at [24]-[37] per Williams J, which summaries I gratefully adopt.

Claims by spouse

9. As to a claim by a spouse of the deceased, the case law is collated and explained in Steinmetz v Shannon (2019) 99 NSWLR 687; [2019] NSWCA 114 at [98]-[109] by Brereton JA. As the application of the Succession Act critically depends on community standards, the development of the case law necessarily reflects the changing roles of men and women in committed relationships, in economic life, and in society. The oft-cited statement of Powell J in Luciano v Rosenblum (1985) 2 NSWLR 65 – made 36 years ago – reflects the situation in traditional marriages rather than the starting point for all such claims. His Honour then said, at 69-70:

It seems to me that, as a broad general rule, and in the absence of special circumstances, the duty of a testator to his widow is, to the extent to which his assets permit him to do so, to ensure that she is secure in her home, to ensure that she has an income sufficient to permit her to live in the style to which she is accustomed, and to provide her with a fund to enable her to meet any unforeseen contingencies.

10. In Marshall v Carruthers [2002] NSWCA 47, Young CJ in Eq (with whom Palmer J agreed) allotted Powell J’s comments to “the typical mid-20th century widow” (at [76]), referrable to the economic disadvantages occasioned by the greater responsibility which women often took in raising children, being financially dependent upon their husband whilst also supporting him to amass his fortune: at [65] per Hodgson JA, [74] per Young CJ in Eq, Palmer J agreeing each. The male comparator of Luciano v Rosenblum is perhaps Re Sylvester [1941] Ch 87 at 89:

Prima facie a husband should be able to maintain himself, and ought not to ask the court to give him, out of his wife’s estate, more than she has thought to provide for him.

11. Nowadays, consideration is given to the length and quality of the relationship; the surviving spouse’s contribution to the relationship, health, earning capacity, age and prospects; the size of the estate and competing claims: Bladwell v Davis [2004] NSWCA 170 at [13]-[19] per Bryson JA (Ipp JA and Stein AJA agreeing) and the authorities there cited. Surviving spouses do not have primacy over all other applicants regardless of circumstances, although where competing factors are more or less otherwise in equilibrium, an elderly widow or widower of the testator with less financial prospects than younger claimants will result in primacy as they have greater need: Bladwell v Davis at [2] per Ipp JA (Stein AJA agreeing).

12. Put shortly, the application of the criteria in section 60(2) of the Succession Act may well, in the case of longstanding, devoted marriages, have the consequence that the surviving spouse will be regarded as entitled to substantial provision being made to secure their quality of life and financial security going forward, but that cannot be assumed simply because they are the surviving spouse. If a spouse makes a claim for provision, the statutory considerations apply equally to them as any other claimant. As Parker J observed in Ikonomou v Panagopoulos [2017] NSWSC 1805, after noting societal changes as reflected in the case law, at [94]:

In my opinion, there is no rule, general or otherwise, that following a long marriage the surviving spouse, by virtue of that status alone, will be entitled to provision out of the deceased spouse’s estate sufficient to keep him or her in the same lifestyle as he or she enjoyed during the marriage. An entitlement to provision of this type must always be justified by reference to the circumstances of the particular case.

Testamentary intention

13. As to the intersection between freedom of testamentary disposition and the Succession Act, the power to make an order for provision is not to be exercised on the footing that great caution must be exercised before interfering with the freedom of testamentary disposition: Steinmetz v Shannon at [95]-[97] per Brereton JA (White JA and Simpson AJA relevantly agreeing); see also White JA’s concurring remarks at [49]-[56], which White JA (with whom Meagher JA and Emmett AJA agreed) adhered to in Olsen v Olsen (2019) 101 NSWLR 225; [2019] NSWCA 278 at [78]. However, in considering what is “proper”, considerable weight may be given to the assessment of a capable testator or testatrix who has given due consideration to the claims on his or her estate: Megerditchian v Khatchadourian [2020] NSWCA 229 at [33] (citing Sgro v Thompson [2017] NSWCA 326 at [6]) and [43] per Payne JA (with whom Macfarlan and Emmett AJA agreed). As White JA explained, after referring to his previous judgments in Friend v Brien [2014] NSWSC 613 at [62], Slack v Rogan (2013) 85 NSWLR 253; [2013] NSWSC 522 at [127] and Sgro v Thompson at [80]-[88], in Olsen v Olsen at [75]:

… where it can be seen that a testator has duly considered the claims on his estate, respect should be given to the judgment of a capable testator who will have been in a better position than is a court to determine such claims so that considerable weight should be given to the testator’s testamentary wishes in recognition of the better position in which the testator was placed. …

14. Most recently, in Starr v Miller [2021] NSWSC 426, Hallen J reviewed the authorities in respect of freedom of testation and the Succession Act at [603]-[609], including the following observation of Callaway JA (Tadgell and Charles JJA agreeing) in Grey v Harrison [1997] 2 VR 359; [1996] VSC 74, which bears reproduction (at 366 [29]):

… it is one of the freedoms that shape our society, and an important human right, that a person should be free to dispose of his or her property as he or she thinks fit. Rights and freedoms must of course be exercised and enjoyed conformably with the rights and freedoms of others, but there is no equity, as it were, to interfere with a testator's dispositions unless he or she has abused that right. To do so is to assume a power to take property from the intended object of the testator's bounty and give it to someone else. In conferring a discretion in the wide terms found in s. [59, Succession Act] the legislature intended it to be exercised in a principled way. A breach of moral duty is the justification for curial intervention and simultaneously limits its legitimate extent. …

Evidence

15. Two evidentiary matters should also be noted. First, in respect of evidence advanced in support of a claim for provision, the observations of Macfarlan JA in Megerditchian v Khatchadourian are apposite: the fact of incomplete or unsatisfactory evidence may permit inferences unfavourable to the applicant for provision to be drawn; uncertainty left by imprecise or inaccurate evidence is not ordinarily to be resolved in favour of the person who was able to give the satisfactory evidence: at [36], citing Nicholls v Hall [2007] NSWCA 356 at [36] (Mason P, Hodgson and McColl JJA). As Parker J explained at first instance in Megerditchian v Khatchadourian [2019] NSWSC 1870 at [152]:

… The onus lies on the plaintiff to prove his or her case. Usually the plaintiff cannot succeed in obtaining provision if he or she already has enough for his or her proper maintenance, education or advancement: Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191 at 231 [123]- [124] per Callinan & Heydon JJ. If the plaintiff fails to lead sufficient evidence about his or her financial position, this may have the result that the onus of demonstrating that he or she lacks enough financial resources for his or her proper maintenance, education and advancement, has not been discharged: Collings v Vakas [2006] NSWSC 393 at [66]- [67]. In this event, the Court does not have the choice it has about whether to draw a Jones v Dunkel inference. The claim must failif the plaintiff has not discharged his or her onus.

16. Second, a large number of witnesses gave evidence as to their observations of the relationship between the plaintiff and his wife. Much of this evidence was second-hand from their understandings of what they gleaned from what the plaintiff or Ms Kemeny said from time to time and thus “not of great help in focusing on the key question and that is whether the deceased should have left the plaintiff provision and, if so, what”: Radzyminski v Radzyminski [2008] NSWSC 239 at [8] per Young CJ in Eq.

WITNESSES

17. In total, 42 affidavits were read and some 1,200 pages of documents were tendered, including a large volume of medical records. The plaintiff read affidavits from 16 witnesses, comprising himself, his sister Anna, his son Patrick, friends Kerry Jones, Jennifer Biviano, Annette Brown, Mark Gardiner, Peter Hughes and wife Hilary Denholm, Eloise Clarke, Deborah Johnston, Jill Romuld, accountant David McGill, local café owners Edwina and Serena Sanderson and solicitor Michaela Money. The defendant read affidavits from 13 witnesses, comprising himself, son Michael, daughter Sarah and her husband, Ms Kemeny’s sister Patricia Chandler, friends Vivien Booth, Jessica Holman, Ricardo Skaff, Rowena Cowley, Kimberley Zimmerlie, Tabatha McFadyen and solicitors Deborah Rutstein and Diana Perla.

18. The plaintiff was cross examined, as was his girlfriend, Ms Romuld, who was a pleasant and dignified lady whose evidence I accept.

19. The plaintiff seemed a very nice, intelligent man. However, there were a number of problems with his evidence. First, until his recent retirement, the plaintiff described himself as a leading wills and estates lawyer and an estate planning specialist. He was clearly knowledgeable about such matters but gave an appearance of being unaware of or disinterested in: the provisions of Ms Kemeny’s prior or last Will (one of which he prepared and the last of which was obviously a matter of keen interest to him); important correspondence between solicitors in these proceedings; and, communications with his accountant in relation to distributions by his family trust, the MJS Family Trust, to Ms Kemeny. The plaintiff was evasive about a change of position in respect of trust distributions shortly before the hearing, blaming his accountant and suggesting that decisions in respect of trust distributions were made by his accountant rather than himself as the director of the trustee company. This seemed unlikely. The plaintiff’s affidavits omitted information which he must have appreciated was relevant, for example, that he had commenced a new relationship and was no longer living in Sydney.

20. Second, the plaintiff proved a poor historian who tended to over-state his role and understate the roles of others, and to generalise where detail was obviously important and rendered the generalisation inaccurate. For example, the plaintiff said he had made a nomination in respect of his superannuation in favour of Ms Kemeny for several years, but did not add that he then made a nomination to benefit his Estate, of which Ms Kemeny was not a beneficiary: see [126]. See also [32].

21. On occasion, the plaintiff was evasive, for example, when cross-examined about a spreadsheet he had prepared setting out his estimated contributions to Ms Kemeny. Some of the plaintiff’s answers were disingenuous, for example, he said he simply did not like acting for friends and family – “I just don’t believe that that’s appropriate” – but it is apparent he did so with reasonable frequency and was clearly keen to help Ms Kemeny prepare her last Will: see [36], [63], [176].

22. This does not mean that I have rejected the plaintiff’s evidence; rather, I have approached it with a degree of caution.

23. The defendant was cross examined, as was his daughter Sarah and Ms Kemeny’s friend, Ms Booth. No issues of credit arose. Mr Kemeny was straightforward and truthful; he did not exaggerate. He was terrible with dates. Sarah was straightforward, clear, open and honest and did not exaggerate. Sarah clearly did not think much of the plaintiff, but she had her reasons.

24. It is not possible to reconcile the evidence of all of the witnesses. To the extent that family and friends made observations on Ms Kemeny’s mobility and needs at particular points in time, I have preferred the medical records to their recollections as to what Ms Kemeny could and could not do – and needed to have done for her – at particular points in time. The central witnesses were all educated, intelligent, articulate and sophisticated people. Thus, considering the widely varying accounts of what happened, I reviewed every contemporaneous document in chronological sequence before turning to the affidavit and oral evidence. This proved to be a helpful exercise.

FACTS

25. The plaintiff and Ms Kemeny met during high school and dated for a few years.

First marriages

26. In 1986, Ms Kemeny married Mr Kemeny, the owner of a liquor store. They had two children, Michael and Sarah. Ms Kemeny stopped working and devoted herself to her children. The couple divorced in 2000. It was a very difficult divorce which took an emotional toll on Ms Kemeny and the children (and presumably Mr Kemeny). Michael suffered from panic attacks and anxiety whilst Sarah and her mother experienced depression.

27. Ms Kemeny received a property settlement of some $1.8 million from her ex-husband. Ms Kemeny used the funds to purchase outright two properties: a Paddington terrace house (where she lived with the children) and a Surry Hills warehouse apartment, which she rented out. The balance of the property settlement (some $300,000) was placed on term deposit. Ms Kemeny lived on rental income from the Surry Hills property, bank interest and child support.

28. Although it had been a difficult divorce, Ms Kemeny and Mr Kemeny resuscitated a friendship. According to Mr Kemeny, “We confided in each other, occasionally argued but did not hold grudges …” Family occasions were spend together at the Paddington terrace. They were both devoted to their children.

29. Meanwhile, the plaintiff married Mary and had a son, Patrick. Sadly, Mary died of breast cancer when Patrick was aged 8. The plaintiff later lived in Turramurra with defacto wife, Dianne Hooke (who herself had two children) and Patrick. By April 2003, the plaintiff’s relationship with Ms Hooke had come to an end. With finance, the plaintiff bought a two-bedroom apartment in Kirribilli, where he lived with Patrick. The plaintiff also made a Will, leaving his Estate to Patrick. The plaintiff was then still negotiating a property settlement with Ms Hooke and his Will provided that, if no legally binding financial agreement had been reached with Ms Hooke at the time of his death, then he gave Ms Hooke $100,000.

They meet again

30. The plaintiff and Ms Kemeny met again at a school reunion and began dating. The differing financial circumstances of the plaintiff and Ms Kemeny on the formation of their relationship were later described by Ms Kemeny in an email:

When I first met you you were working as a partner for (your old firm) and worked for AMP also. You had no money because, you told me, you had been generous to Diane. You had a large interest only mortgage for your apartment in Kirribilli and were paying many insurances. And you had your super and salary. You had a notion to set up an online wills package.

I had my house, my small investment unit and a small nest egg investment. This represented my independence.

You thought that was great – a woman with financial independence.

31. Evidence varied as to precisely when the relationship began, when the plaintiff began to spend the night at the Paddington terrace, and when the plaintiff moved in. The plaintiff says the relationship began in about March 2003 and, shortly afterwards, he began spending a few nights a week at the Paddington terrace where Ms Kemeny was living with Michael and Sarah. In June or July 2004, he moved in whilst the plaintiff’s sister, Anna, moved into the Kirribilli apartment with Patrick. Patrick and Anna corroborate the plaintiff’s account.

32. The plaintiff also provided legal assistance to Ms Kemeny to recover monies lent to a former acquaintance. Whilst the plaintiff’s first affidavit appeared to suggest that he did this gratis, a trust account statement found amongst Ms Kemeny’s papers indicates that Ms Kemeny paid for these services.

33. Mr Kemeny, Michael and Sarah place these events some time later. In 2003, Michael was in Year 11. He then had a difficult relationship with his mother. Supported by a school counsellor, Michael went to live with his father in late 2003 as he was able to study more easily there. Ms Kemeny was not happy about Michael’s decision, but came to accept it. Michael then spent the weekends with his mother and sister. Michael never met the plaintiff while he was living with his mother in 2003. Michael recalls first meeting the plaintiff at the Paddington terrace in early 2004, “I remember vividly the first day I met the Plaintiff. I was a teen, around 16 years old and there was a man in the house whom I did not know”. The meeting did not go well. Michael stopped staying overnight at Paddington.

34. Sarah says she first met the plaintiff after he and Ms Kemeny became engaged in about mid-2004. In about July 2004, the plaintiff gradually started staying overnight at the Paddington terrace and officially moved in after their wedding in November 2004.

35. I prefer Michael and Sarah’s evidence as to when the plaintiff first came into their lives. These would have been seismic events in the life of these teenagers and Michael, in particular, can point to external events which permit him to be firm as to why the plaintiff’s recollection is incorrect.

36. I am more confident in this conclusion because Ms Johnstone, who also attended the school reunion, said it happened in August 2003. Second, in December 2003, Ms Kemeny made a Will, appointing the plaintiff as executor. The plaintiff drafted the Will. The plaintiff was described in the Will as Ms Kemeny’s “friend”, being presumably a description that both the author and testator considered accurate at the time. (By her Will, Ms Kemeny left her Estate to her children in equal shares). Third, the legal fees referred to at [32] were charged to Ms Kemeny in March 2004, which might be thought odd if the parties had been dating for a year in the manner described by the plaintiff. It is noteworthy that the plaintiff said, in cross-examination: (emphasis added)

That was very early in the relationship, and I was not at her place at that time. And look, as the relationship went on, I would not have acted in that capacity because I would have been in a relationship with her, that I would have felt would have precluded me acting for her. But at that very early stage, I felt it still appropriate that I could act for her, and look, the firm charged their own, I didn't personally charge her. And it wouldn't have been at full rates either, I suspect.

37. Fourth, it is inherently more likely that Ms Kemeny, as a dedicated parent (which there is no doubt she was) would have deferred introducing the plaintiff into the family home until the relationship had matured beyond its infancy. Thus I find that the plaintiff and Ms Kemeny formed a relationship which, by mid-2004, could be described as a committed relationship. There was no material co-habitation before their marriage.

Second marriage

38. In November 2004, the plaintiff and Ms Kemeny married. It is reasonably clear that Michael doubted the plaintiff’s motives in marrying his mother, and those doubts never allayed. Before their wedding, Mr Kemeny conveyed their son Michael’s concerns that the plaintiff was only after her money. Ms Kemeny said “I’m not stupid. … We agreed before we got married that each of us will leave everything to our kids”. Consistently with this, on their wedding day, the plaintiff and Ms Kemeny re-executed their Wills, confirming that they each left their respective Estates to their own children. At the time, Ms Kemeny said to one of the witnesses, Ms Jones, “I need to protect my children”.

39. The fact that Ms Kemeny re-executed her Will after her marriage to the plaintiff was not known to Sarah and later led to mistrust and suspicion. This misunderstanding was dispelled during a mediation such that allegations made in respect of that matter were no longer maintained. However, this may have been a factor prompting Ms Kemeny to make a Will in 2017.

Financial arrangements

40. The plaintiff agreed that, at the start of their relationship and before they were married, Ms Kemeny was very insistent on maintaining separate finances and financial records. Although the plaintiff suggested that they have a joint account for housekeeping, Ms Kemeny refused. The plaintiff and Ms Kemeny maintained separate bank accounts.

41. The plaintiff performed maintenance and repairs on the Paddington terrace and paid for some of these repairs. Mr Kemeny was aware that the plaintiff paid for some repairs, but Ms Kemeny told him that the plaintiff paid for the repairs in lieu of money which he owed her, which is confirmed by Ms Kemeny’s email set out below.

42. The agreement between the plaintiff and Ms Kemeny as to the plaintiff’s contribution to household expenses is, I think, revealed in an email from Ms Kemeny to the plaintiff, sent in September 2015, when disagreements about money had reduced the couple to email correspondence. Ms Kemeny set out “my point of view in writing, for your reference”:

You paid for the fixing of the upstairs water damaged roof at $30,000 as your contribution for living in the place I otherwise had secured and furnished. Going forward, you said you would prefer to pay a monthly contribution and I said then I would be responsible for future renovations of the house. We agreed that money was your contribution and my money to apportion. That I would not therefore put it on you for further house repairing moneys.

...

(I remind you that we originally agreed to $500/week, which is $26,000/annum. You actually pay $2,000/month which is $24,000/annum, so you already save $2,000 (a trip to the UK)/annum. This agreement is a perfectly reasonable agreement.)

43. In addition to the plaintiff’s $500 a week as his contribution for living in Ms Kemeny’s house, Ms Kemeny sought half of household expenses from the plaintiff. Four handwritten notes prepared by Ms Kemeny are in evidence, which indicate that Ms Kemeny required the plaintiff to pay half of household bills, including car servicing, telephone, gas, electricity, water, insurance, rates and wine. (The plaintiff did not accept that Ms Kemeny kept such meticulous records consistently).

44. Ms Kemeny told Mr Kemeny that the plaintiff was paying $250 a week for his share of housekeeping and $500 a week, being half of market rent. Of this arrangement, Ms Kemeny told Mr Kemeny on a number of occasions, “Michael has got nothing to complain about. Other than paying his share of expenses and rent, Michael gets to keep his salary”. Ms Kemeny told Mr Kemeny that she kept her finances completely separate from the plaintiff and sometimes complained, “Michael’s pretty tight and tries to avoid paying his share, but I keep on top of it”.

45. Mr Kemeny said Ms Kemeny was a pedantic person when it came to money and kept records of the amounts owed to her, and wrote meticulously on each bill who paid it and when. When out to dinner with Ms Kemeny and the plaintiff, Mr Kemeny says they kept tabs on whose turn it was to pay. Ms Kemeny often told Sarah of the arrangement she had with the plaintiff whereby each paid for their half of expenses. Sarah often saw her mother working out her finances at the dining room table.

46. In contrast, the plaintiff said that he paid Ms Kemeny $250 a week housekeeping money for the duration of their relationship. In addition, he usually paid for groceries and joint living expenses such as dining out, medical insurance, entertainment and utility bills with Ms Kemeny reimbursing him from time to time on an ad hoc basis for some of these joint expenses. The plaintiff prepared a detailed analysis of the payments he made during his relationship with Ms Kemeny. From bank statements, he identified some $35,000 per annum paid to Ms Kemeny including superannuation contributions and for joint or household expenses. The plaintiff agreed, however, that these figures did not factor in any payments made by Ms Kemeny for him. It is apparent from Ms Kemeny’s handwritten notes that some of the plaintiff’s payments to her were, in fact, reimbursement of his share of household expenses which Ms Kemeny had already paid. The analysis contained other errors, including that the plaintiff included the purchase of Ms Kemeny’s 60th birthday present as a joint expense for which she was obliged to pay half.

47. The plaintiff’s calculations, prepared for the purpose of these proceedings, is equally explicable with an agreement with Ms Kemeny that he would pay $500 a week ‘rent’ for living at the Paddington terrace and half of household expenses. The contemporaneous documents support the existence of such an agreement. In circumstances where the plaintiff was working full-time and in receipt of a law firm partner’s salary, whilst Ms Kemeny owned and ran the home in which they lived (Ms Kemeny later said, “For twelve years or more I did everything, everything.”) but did not herself enjoy a wage, it may not have been an arrangement which every married couple would have agreed upon, but was likely agreed upon by this couple.

48. In addition, Ms Kemeny notionally received trust distributions from the plaintiff’s family trust, the MJS Family Trust. The plaintiff’s income paid by the law firm was paid to the trust and, when he required funds, he transferred money from the trust to his personal bank account. The plaintiff’s accountant suggested that all trust income be distributed to his wife as she was on a lower tax bracket. At the end of each financial year, the plaintiff caused the trustee to resolve that distributions of income from the trust be made in favour of Ms Kemeny. The plaintiff told Ms Kemeny that he would distribute the income accordingly, and would also pay the tax on the distributions for her. The distributions were declared, but not actually paid to Ms Kemeny. Presumably, the plaintiff received a benefit from this arrangement in the form of reduced tax.

49. The plaintiff and Ms Kemeny had a clear separation of finances from the outset. The plaintiff earnt an income as partner of a law firm, from which he paid $500 a week ‘rent’ to Ms Kemeny, in recognition of the fact that he was living in her home, which Ms Kemeny could use as she saw fit to maintain and renovate the Paddington terrace. In addition, they shared household expenses equally. Ms Kemeny went to some effort to ensure that this arrangement was observed. As will become clear, the plaintiff became unhappy with this arrangement in later years, in particular, with respect to the $500 a week ‘rent’: see [93]-[96].

Their children

50. Each of Michael, Sarah and Patrick enjoyed a close relationship with their parents, received fine educations and have pursued admirable endeavours.

51. Michael described his relationship with his mother as very close, “if somewhat argumentative”. Michael and his mother quarrelled often but had an honest and close relationship. That does appear to have been the case. Michael is now a Professor of Mathematics at the University of Wisconsin-Maddison.

52. Sarah described her relationship with her mother as very close; that certainly appears to have been the case. The mother and daughter relationship was not without incident and it is clear that, from time to time, they had disagreements. Sarah pursued a career as an opera singer, both here and abroad. As will be seen, that pursuit was significantly interrupted by Sarah’s involvement in her mother’s care.

53. Patrick is living and working in London, currently a doctoral student in economics. Patrick is obviously also close to his father. He communicated regularly with the plaintiff and Ms Kemeny to support each of them.

54. Michael and Sarah gave evidence which supported their mother and Patrick gave evidence which supported his father. Some of the evidence had a partisan quality but I do not criticise the children at all in this regard. Michael, Sarah and Patrick were the recipients of quite frank communications from Ms Kemeny and the plaintiff as to their respective plights, which the children endeavoured to act upon in supporting their parents as best they could, albeit limited by their relative youth. Michael, Sarah and Patrick each appear to be impressive young adults who have done their best to support their parents throughout.

Married life

55. The plaintiff says he enjoyed living with Ms Kemeny and Sarah, and became involved in Sarah’s studies and activities. Sarah’s description of his involvement is more confined; Sarah says that, after the wedding, the plaintiff was still often at the Kirribilli apartment where Patrick was living.

56. The plaintiff says that Ms Kemeny, “was fantastic with my son Patrick. She was always more than willing to have him around to our home, along with his friends”. Ms Kemeny and the plaintiff hosted Patrick’s 21st birthday party at the Paddington terrace with about 50 guests and Ms Kemeny put in a huge effort to organise the event. Patrick also lived with the plaintiff and Ms Kemeny in the Paddington terrace for about 11 months. Certainly, Ms Kemeny and Patrick formed a good relationship.

57. In the early years of their relationship, the couple hosted a number of dinner parties at the Paddington terrace; Ms Kemeny was a fine cook (This is a fact on which all witnesses wholeheartedly agree). The plaintiff says that he and Ms Kemeny did the shopping together; he did the bulk of the preparatory work while Sarah set the table. The plaintiff learnt some skills from Ms Kemeny and had certain dishes that were his to prepare in their entirety. Sarah’s husband attended the Paddington terrace over five years or so for these dinners. As he describes it, Ms Kemeny and her daughter shopped for ingredients, chose wines, prepared the house and were busy in the kitchen whilst the plaintiff and Sarah’s husband watched them work and did the odd task as requested such as taking things to the table or scraps to the compost bin, whilst having some of the wine that Ms Kemeny had provided from her great collection. He can recall only one occasion where the plaintiff cooked some chicken on the barbecue and, at other times, lent a hand cooking potatoes.

58. According to the plaintiff, he and Ms Kemeny often spent their weekends on walks at Dee Why, Bobbin Head and Eastern Suburbs coastal walks. They also attended a number of liquor industry events, invited by Mr Kemeny. Before Ms Kemeny’s illness, they went on a few holidays together to Darwin and Kakadu and overnight trips to the Blue Mountains. Sarah says her mother and the plaintiff went on very few holidays together but travelled separately a few times. This description does appear accurate, at least after Ms Kemeny became unwell: see [91]-[92].

59. The plaintiff, Ms Kemeny, Michael, Sarah, Patrick and Mr Kemeny enjoyed solid friendships with each other. Mr Kemeny says he had a good relationship with the plaintiff and Ms Kemeny. When they were out together, Ms Kemeny often referred to Mr Kemeny and the plaintiff as “husband number 1 and husband number 2”. Mr Kemeny was a regular visitor to their home for events such as Christmas and children’s birthdays. The plaintiff and Mr Kemeny shared a love of sailing; Mr Kemeny introduced the plaintiff to cycling.

The plaintiff’s superannuation

60. The plaintiff had some superannuation whilst Ms Kemeny did not. In March 2005, the plaintiff signed a document, “Testamentary Wishes of Michael John Schneider”, so that Ms Kemeny and Patrick were clear on his wishes in the event of his premature death. The document stated:

It has been my intention for some months now to make provision for Kathy in a way that ultimately enables Patrick to receive the capital I provide to her upon her death. Kathy, though asset rich, will be in need of an income stream. Patrick, upon finishing his education I expect, will have an excellent income stream. With this in mind, I have provided Kathy with a Binding Death Benefit Nomination such that she will receive 100% of the assets in my AMP superannuation fund.

61. According to the document, the plaintiff intended that Ms Kemeny pass onto Patrick sufficient of the superannuation monies to enable Patrick to maintain himself until he left university, including a ‘gap’ year. The plaintiff wished Ms Kemeny to enter into an agreement with Patrick to retain sufficient property of a value equivalent to the amount of superannuation which she used, and to make provision in her Will for Patrick to that amount. As I understand it, the plaintiff intended that, if he pre-deceased his wife, Ms Kemeny would have the use of his superannuation fund during her lifetime but would leave enough for Patrick to complete his studies and also, by her Estate and Will, to reimburse Patrick for the funds which she had used. In 2006, the plaintiff executed a Binding Death Benefit Nomination in which he nominated Ms Kemeny to receive 100% of his superannuation death benefit.

61. In 2006, Patrick moved out of the Kirribilli apartment into a house in Bellevue Hill owned by Mr Kemeny. The plaintiff rented out the Kirribilli apartment and later sold it for about $560,000. After paying out the mortgage of some $150,000, the bulk of the net proceeds were placed in the plaintiff’s superannuation fund. According to the plaintiff, the Kirribilli property was sold following financial advice to diversify their assets, with the proceeds of sale to be paid into superannuation to provide an income for the couple on retirement. According to Ms Kemeny’s email, “You sold Kirribilli to free up some funds as you were now living with me”.

Plaintiff asks Ms Kemeny to change her Will in his favour

63. In about 2006, the plaintiff spoke to Ms Kemeny on several occasions, saying they should really talk about estate planning, but she did not wish to discuss it. After finally seeing a financial adviser and agreeing upon a strategy of selling the Kirribilli property to be put into superannuation, the plaintiff told Ms Kemeny, “You need to make sure I am looked after as well. If you die, I will have income but nowhere to live. You need to make sure I have a place to live. Right now, you have more assets than me. But over time, this will change.” The plaintiff offered to prepared draft wills but Ms Kemeny did not wish to discuss it. According to the plaintiff, “We had a very long conversation outside Bunnings … and we didn’t finish the discussion. It was one of those difficult discussions, which she clearly didn’t want to have … We never got to a detailed discussion about her or my will. It was always high level”.

64. The plaintiff’s suggestion that he had a concluded agreement with Ms Kemeny to make a new Will in return for the plaintiff selling the Kirribilli apartment and investing it in superannuation was not established. Perhaps having been divorced and now only two years married, Ms Kemeny found it hard to understand why, in return for her husband contributing $560,000 to his superannuation fund, she should make provision in her Will to leave her husband a property of far greater value. Even on the plaintiff’s version of events, Ms Kemeny never warmed to this proposition. Following Ms Kemeny’s diagnosis, the plaintiff says that she became “even more strident” whenever he raised the issue of estate planning.

65. According to Patrick, a few years after the plaintiff married Ms Kemeny, his father told him:

Kathy and I have decided that in the event that one of us dies, our assets will be used to support the other, until the other dies and then the assets will revert back to the child or children of that person. So, if I die first, my assets will be held on trust to support Kathy and then you will receive them when Kathy dies; and if she dies first, her assets will support me and then go on to her kids when I die.

The plaintiff repeatedly told Patrick about this arrangement as the years passed. Any such comments to Patrick would have been aspirational. The plaintiff always understood that Ms Kemeny had a Will in place which left everything equally to her children, “That became of huge concern to me over time”. The plaintiff’s ideas on estate planning were not shared by his wife, notwithstanding his efforts to persuade her of his views.

66. In 2008, Sarah moved to Brisbane to study a Bachelor of Music at the Queensland Conservatorium of Music. In 2009, Michael moved overseas to further his studies but spoke to his mother by Skype several times a week and maintained constant email and, later, Whatsapp communication. Michael flew back to Australia for Christmas most years.

67. In July 2009, the plaintiff signed a superannuation nomination form, nominating Ms Kemeny as the sole beneficiary of his superannuation. In addition, a superannuation fund was established in Ms Kemeny’s name with $40,000 deposited in July 2009 and $20,000 deposited in August 2009. The plaintiff made these contributions. The plaintiff appears to have had a relationship with AMP, in addition to working as a lawyer, and appears to have favoured superannuation as an investment strategy.

Cancer diagnosis

68. The plaintiff says he regularly checked Ms Kemeny’s breasts for lumps and, one morning, found a lump “above her left breast” (although I note the mass appears to have been detected, rather, on the medial end of her right clavicle). On 7 October 2009, Ms Kemeny’s treating general practitioner, Dr Karen Spielman, informed Ms Kemeny that she had a metastatic melanoma. Ms Kemeny was understandably shocked, and Dr Spielman “[c]alled Michael who came in to be with her”. The plaintiff says that Dr Spielman told them that Ms Kemeny had stage four melanoma and there was little that could be done to treat it, apart from palliative care. This is not readily apparent from Dr Spielman’s notes, and unlikely something that a general practitioner would say on a first consultation following an adverse test result.

69. Ms Kemeny spoke to her doctor again on 9 October 2009 and was very nervous and “Worried about Sarah”. Sarah was indeed devastated by the news and began flying back from Brisbane every weekend to be with her mother.

70. Ms Kemeny was then aged 54. The couple had been married for nearly five years. The plaintiff says that, following the diagnosis, his intimate relationship with Ms Kemeny ceased. Certainly, the plaintiff and Ms Kemeny slept in separate bedrooms.

The journey begins

71. Mr Kemeny and, more particularly, Sarah, challenged the nature and quality of the plaintiff's relationship with Ms Kemeny and the care provided during her illness. The plaintiff’s solicitor compiled medical records recording every attendance of the plaintiff or Sarah with Ms Kemeny during her treatment. (This compilation would not have captured attendances by other family members or friends, nor the occasions when Ms Kemeny had no-one with her.) Given the emphasis that this issue received in these proceedings, I have reviewed the medical records and summarised what the records reveal as to the plaintiff and Sarah’s involvement in Ms Kemeny’s care.

72. On 12 October 2009, Dr Spielman had a telephone consultation with Ms Kemeny. On 23 October 2009, Dr Spielman spoke with the plaintiff and Ms Kemeny, confirming the diagnosis following excision of a lump. On 28 October 2009, Dr Spielman sent an email to a medical colleague noting, “I have been speaking to [the plaintiff] today.” On 30 October 2009, Dr Spielman had a long discussion with Ms Kemeny regarding her diagnosis and how best to fight it. Her notes record, “Talked about family and who is able to support her and their approaches”. On 18 November 2009, Dr Spielman examined Ms Kemeny in her surgery. On 20 November 2009, the plaintiff and Ms Kemeny met with oncologist, Professor Richard Kefford, to discuss options. On 27 November 2009, the plaintiff and Ms Kemeny saw Dr Lynette Ward (Ms Kemeny had fallen and broken her hand), who called Ms Kemeny on 28 November 2009 to convey x-ray results. On 30 November 2009, Dr Spielman telephoned Ms Kemeny, who was starting chemotherapy.

73. On 30 November 2009, chemotherapy began. The patient registration form for Westmead Cancer Care Centre noted the plaintiff as Ms Kemeny’s next of kin. On 4 December 2009, Dr Spielman asked the plaintiff to come in and get Ms Kemeny’s prescriptions. On 21 December 2009, Dr Spielman had a telephone consultation with Ms Kemeny regarding recent surgery and chemotherapy resuming the next day. On 19 January 2010, Ms Kemeny had further chemotherapy and was discharged home in the care of the plaintiff. On 3 February 2010, the plaintiff called Dr Spielman to update her on Ms Kemeny’s progress.

74. According to Mr Kemeny, after Ms Kemeny was diagnosed, their contact became more frequent and they often talked and messaged each other several times a day. On 8 February 2010, both the plaintiff and Mr Kemeny were at the hospital; Mr Kemeny was asking questions about the disease. On 10 February 2010, Dr Spielman sought a second opinion from Professor Hersey regarding the most effective management of Ms Kemeny’s disease noting she was under the care of Professor Kefford, “as I’m sure she and Michael will explain in detail”. On 15 February 2010, Mr Kemeny was again in attendance at the hospital, requesting “total surgery”. Ms Kemeny later recalled in a text message to Mr Kemeny:

I have always been extremely grateful for all the research you did when I was diagnosed … I was gobsmacked when [a doctor] said to me “Come back when you’re really sick” and totally supported you when you yelled at her on my behalf. … I will never forget that you and Sarah did extensive and exhaustive research into new trials. As a result, I got on to [a trial] which saved me [f]our years. … I remember [the plaintiff] said you shouldn’t have challenged that [doctor] … these days he knows you much better …

75. Mr Kemeny recalls that he and Sarah did extensive research into Ms Kemeny’s condition and the various medical trials taking place and pushed for Ms Kemeny to be accepted for clinical trials. Sarah says Mr Kemeny rang and told her, “Mum is really scared and Michael isn’t doing anything”. Sarah became absorbed in investigating the diagnosis and researched trials being conducted in Australia and overseas, including medical journals and papers on melanoma and cold-calling professors from medical institutes and hospitals to see if they would accept Ms Kemeny as a candidate for a trial. According to Sarah, “I became so well researched on the trials and treatments that the professors would ask me what field of medicine I was studying”. According to the plaintiff’s first affidavit, it was he who begged for Ms Kemeny’s inclusion in the trial rather than Mr Kemeny. I expect that all of them did what they could to have Ms Kemeny included in clinical trials.

76. Sarah deferred her studies and moved back to Sydney and became her mother’s full-time aide, driving her to appointments and staying with her, sometimes overnight in hospital, for medical treatment. Most of the medical appointments were during the week and generally took the whole day. Sarah did not view herself as her mother’s ‘carer’; “I knew Mum needed my assistance and I wanted to be there for her”. Sarah also did some work for her father’s business, primarily in event management and working with national distributors.

77. On 9 March 2010, Ms Kemeny was admitted to Westmead Private Hospital. The plaintiff was noted as next of kin. On 7 April 2010, Dr Spielman had conversations with Ms Kemeny, Mr Kemeny and Sarah regarding Ms Kemeny’s treatment and options. On 13 April 2010, the plaintiff and Ms Kemeny attended Dr Ron Bova, a surgeon to discuss possible surgery. On 19 April 2010, Dr Spielman spoke to the plaintiff about a possible medical trial. On 18 April 2010, Professor Kefford reported to a fellow professor, “I have mentioned to her and [the plaintiff] that she would probably be an ideal candidate” for a particular medication.

78. On 6 May 2010, Ms Kemeny emailed Michael noting, “We were at the hospital this morning starting the trial drug. Sarah and I were there yesterday 7am – 7pm because I had to do a drug interaction trial as part of the deal”. On 14 July 2010, Ms Kemeny emailed Michael:

Tomorrow morning Sarah is taking me to the hospital for my check up … this afternoon … Sarah and I were driving back from Westmead. I was booked in for an echocardiogram … and because of peak hour traffic we arrived late and they said too bad they had already turned the machine off so I have to go back again on Friday afternoon. Sarah goes to Brisbane on Friday at 2pm. That will be 3 days in a row I have to go out to Westmead. When we got home Sarah said she had just been driving 2.5 hours, because of peak hour traffic. For that amount of driving we could have been in Canberra or Lithgow, or heaps of other places more interesting that just Westmead and back. … The plan is to go out tomorrow night with Patrick being back and Sarah going back to Bris.

79. Whilst the nine months after diagnosis appears to have involved a significant number of medical appointments and treatments, these reduced in the next three years. Patrick moved into the Paddington terrace in early 2011 and lived there for about a year. He recalls the plaintiff and Sarah being involved in discussions about Ms Kemeny’s medical treatments. On 5 August 2011, Ms Kemeny saw Dr Spielman for review, noting she and the plaintiff had attended retreats together. Ms Kemeny was doing well. On 5 August 2011, the plaintiff again signed a superannuation nomination form, directing that his superannuation be paid to Ms Kemeny. Another nomination to similar effect was signed by the plaintiff on 18 July 2012. On 18 December 2012, the plaintiff and Ms Kemeny saw an oncologist, Dr Mary Azer, for review, “I had a long discussion with Katherine and her husband”.

80. In 2013, Sarah resumed her studies at the Sydney Conservatorium. Sarah was then 25, when she would otherwise have already finished her studies. Ms McFadyen is a director at Opera Australia and described opera as an industry in which opportunities are proportionate to age; entry level jobs and scholarship opportunities often have age cut-offs of 26, with most ending around 30. Ms McFadyen also described Sarah as an exceptionally talented, incredibly motivated artist. Sarah’s goal was to be a soloist opera singer with a major company. She planned to get involved in the “Young Artist Program” with a major opera house. Sarah says her mother planned her medical appointments around Sarah’s university schedule so that Sarah could drive her. This is confirmed by Sarah’s opera teacher, Ms Cowley.

81. In April 2013, Ms Kemeny agreed to participate in a medical trial. Her consent form was witnessed by the plaintiff. On 1 May 2013, an oncologist wrote to Professor Kefford regarding the removal of a tumour, noting “Katherine and her husband are keen to proceed in this way”. On 31 July 2013, Dr Spielman’s notes record “Sarah and Michael [likely the plaintiff] worried re lump in her left shoulder”. Dr Spielman examined the patient and saw Ms Kemeny again on 2 and 5 August 2013. On 21 August 2013, Ms Kemeny updated Michael as to her progress, noting she had seen the surgeon today about surgery to remove a lump on her shoulder, “Sarah asked him all about the trial … I have been really stressed and upset these last three weeks. I’m much relieved tonight, but super exhausted. I need a good night’s rest and I’ll be back on board tomorrow”.

82. In September 2013, Patrick moved to the United Kingdom to study at Oxford University whilst Sarah moved out to live with her then boyfriend, now husband, in Centennial Park. On 10 February 2014, Ms Kemeny emailed Michael:

Sarah and I spent all day at the hospital today, mostly waiting 2 ½ hrs for my clinic appointment! We discussed next drug options. All scary and confronting. When I got home I had to catch up on daily chores. I’m totally exhausted! …

83. On 20 February 2014, Ms Kemeny received further chemotherapy and was discharged home with Sarah. On 27 February 2014, Ms Kemeny was reviewed by oncologists with the plaintiff and Sarah. “She lives in Paddington with Michael and Sarah and there are two other children overseas living in Oxford and Berlin. … We had a broad discussion with Katherine and her family …” On 13 March 2014, Ms Kemeny was reviewed by another oncologist who noted, “I had a discussion with Katherine and her daughter regarding future treatment options.” Ms Kemeny was reviewed again on 20 March 2014, this time with the plaintiff and Sarah.

84. On 9 April 2014, Ms Kemeny saw Dr Spielman, reporting “Sarah [is] good, son overseas is angry, husband Michael is okay but plodding along”. On 11 August 2014, Ms Kemeny was admitted to hospital for chemotherapy. The plaintiff was noted as her next of kin whilst Sarah’s contact details were provided as the emergency contact. Ms Kemeny was discharged home with Sarah. On 4 September 2014, Ms Kemeny received further chemotherapy and was discharged home into the care of Sarah. On 25 September 2014, 16 October 2014 and 6 November 2014, Ms Kemeny received further chemotherapy and was discharged into the care of Sarah.

85. On 27 November 2014, Ms Kemeny received further chemotherapy and was discharged into the care of the plaintiff. On 16 December 2014, Ms Kemeny received further chemotherapy and was discharged home in Sarah’s care. On 8 January 2015, after chemotherapy, Ms Kemeny was discharged home with the plaintiff. On 28 February 2015, after chemotherapy, Ms Kemeny was discharged home with Sarah; on 12 March 2015 and 2 April 2015, Ms Kemeny was discharged home in the plaintiff’s care after chemotherapy. On 15 May 2015, after chemotherapy, Ms Kemeny was discharged home in the care of Sarah and, on 24 May 2015, discharged home in the plaintiff’s care.

Financial stress for Ms Kemeny

86. On 18 September 2014, Ms Kemeny’s mother advanced $50,000 to Ms Kemeny in light of the financial strain resulting from her ongoing medical issues. The money was received as an advance on Ms Kemeny’s inheritance. The plaintiff witnessed Ms Kemeny’s signature on an acknowledgement of the advance. As Ms Kemeny later noted in an email to the plaintiff:

In late 2013, early 2014 I had three general operations within a few months and it added to my credit card interest bill. At one point you loaned me some money to pay my credit interest. Then my brother advanced me some money from my inheritance (apparently at my mother’s wishes) and I repaid my snowballing interest. I repaid you the money you lent me by paying your share of utility payments until I was repaid.

87. It is apparent from Ms Kemeny’s email – and self-evident from the medical records – that Ms Kemeny was incurring significant medical expenses and had limited financial resources to pay these bills. According to Mr Kemeny, Ms Kemeny was very concerned about running out of money and would often say to Mr Kemeny, “I can’t spend too much. I have only a limited amount of earnings and I have to be careful of protecting my nest-egg as I have to live off it. I know Michael won’t help me in an emergency and, if I die, I don’t want to waste the children’s inheritance”.

88. Michael was planning to come to Australia in 2014 with his long-time girlfriend, now his wife. They were planning a trip to Tasmania with Ms Kemeny but the trip was cancelled. Ms Kemeny told Michael that the plaintiff did not want to spend any money travelling to Tasmania and had cancelled the trip. (The plaintiff says he cancelled the trip as he did not want to travel with Michael.) Michael told his mother that the plaintiff “is always so tight with money and never [lets] you spend any on travel or on life”.

89. Michael raised his concerns about the plaintiff’s aspirations for Ms Kemeny’s assets with his mother directly; she assured Michael that she and the plaintiff were keeping everything separate and each party’s assets would be inherited by their own children. On 20 November 2014, Ms Kemeny sent an email to her son and Mr Kemeny regarding Michael’s concerns about Ms Kemeny’s financial arrangements with the plaintiff: (emphasis added)

… I have told you before that [the plaintiff] pays his way. What he does with the rest of his money is his business. …

[The plaintiff’s] money is not all my money and my house is not [the plaintiff’s] were it sold. …

What money I do have in reserve I have to keep a budget on because at any time I may need it – and more which I don’t have – for some treatment or other. It would be the most foolish to squander it. Who is there to bail me out?

90. It is apparent that, not only did the plaintiff and Ms Kemeny keep their finances separate in relation to household expenses, but that arrangement extended to Ms Kemeny’s medical expenses. Ms Kemeny funded these expenses and did not feel that she could look to the plaintiff if she exhausted her own financial resources. In April 2015, Ms Kemeny received an inheritance of $150,000 following the death of her mother. Presumably, this provided some financial relief for Ms Kemeny.

248. Also relevant is that Mr Kemeny and his mother have, from time to time, given money to Michael and Sarah including to given them a start in their married lives. It may be expected that Michael and Sarah may receive an inheritance from their father and grandmother, but there was no evidence to enable me to take this consideration very far. It is too uncertain.

Conclusion

251. Having considered these matters, I conclude that Ms Kemeny did make adequate provision for the proper maintenance, education or advancement in life of the plaintiff. The provision may not have been generous but it was entirely commensurate with the tenor of their relationship and their dealings with each other since its inception. Ms Kemeny considered the claims on her Estate, in particular, the plaintiff’s claim. To the extent that the plaintiff compromised his earnings or took care of Ms Kemeny during her illness and, in particular, the final months of her life when Sarah was less available to assist, the provision is a suitable recognition of the plaintiff’s contributions. I have no particular reason to doubt Ms Kemeny’s judgment in respect of the plaintiff’s claim.

252. In the circumstances which prevailed in this marriage, Ms Kemeny did not abuse her power as testator, nor breach her moral duty to her husband in making the provision which she did. The facts surrounding this particular marriage relationship did not give the plaintiff ‘primacy in fact’. I will, however, extend the plaintiff’s rent-free period in the Darlinghurst apartment for 28 days beyond delivery of this judgment, as I have taken this period of rent-free accommodation into account at [231]. I would be grateful if the parties would bring in short minutes of order giving effect to these reasons within 14 days, also then notifying any errors and omissions.

**********

Amendments

14 May 2021 - Amendments to coversheet;

[186], [188] - Shoalhaven amended to Shoal Bay.

10 June 2021 - [1] – “16 February” amended to “18 February”

[160] – “Ms Kemeny had been ‘pestering …” amended to “The plaintiff had been ‘pestering…”

[167] – “WeChat” amended to “Whatsapp” & “ensured” amended to “ensued”

[204] – citation [2019] NSWSC 870 to “[2019] NSWSC 1870”

[206] – “$15,000” amended to “US$266,478”

[207] – “$125,000”, “$280,000” and “$1,700” amended to “$149,000”, “$289,000” and “$1,600” respectively

[229] – “by returning to Ms Romuld” amended to “by returning to Ms Rutstein”

[246] - delete "that"

Decision last updated: 10 June 2021