Straede v Eastwood

[2003] NSWSC 280

CITATION:	Straede v Eastwood & Anor [2003] NSWSC 280
HEARING DATE(S):	1 and 2 April, 2003
JUDGMENT DATE:	2 April 2003
JURISDICTION:	Equity Division
JUDGMENT OF:	Palmer J
DECISION:	Orders made modifying effect of forfeiture rule in whole as sought in Summons - Plaintiff to pay own costs of application - Defendants to have costs out of the estate.
CATCHWORDS:	FORFEITURE ACT - FORFEITURE RULE - RELEVANT CONDUCT - IMMORALITY - Plaintiff's wife killed in motor car accident in which Plaintiff was driver - Plaintiff pleaded guilty to dangerous driving causing death - Plaintiff applies for modification order under Forfeiture Act to permit him to receive benefit of dispositions in wife's will - other beneficiaries oppose order - Plaintiff and wife lived in ménage à trois for twenty years prior to wife's death - whether Plaintiff's "immorality" a relevant aspect of the Plaintiff's "conduct" to which the Court must have regard under s.5(3)(a) Forfeiture Act - principles discussed. - HELD: Conduct of offender to which the Court must have regard under s.5(3)(a) is conduct which has some bearing upon the circumstances in which the deceased was killed and upon the culpability of the offender - conduct during the marriage of the Plaintiff and the deceased had no bearing upon the circumstances of the deceased's death and was irrelevant. - FORFEITURE ACT - RELEVANT MATTERS - Needs of other beneficiaries and wishes of deceased - whether and to what extent relevant - principles discussed. - HELD: Needs of other beneficiaries and wishes of deceased not relevant in circumstances of the case. - FORFEITURE ACT - COSTS - Whether each party should have costs out of the estate - principles discussed. - HELD: Plaintiff to pay own costs - other parties to have costs of estate.
LEGISLATION CITED:	- Crimes Act 1900 (NSW) - s.52A(1c) - Forfeiture Act 1995 (NSW) - s.3, s.4, s.5, s.6 - Family Provision Act 1982 (NSW) - Jurisdiction of Courts (Foreign Land) Act 1989 (NSW) - s.4 - Property (Relationships) Act 1984 (NSW) - Wills, Probate and Administration Act 1898 (NSW)
CASES CITED:	- Beresford v Royal Insurance Company Ltd [1937] 2 KB 197 - Dunbar v Plant [1997] 4 All ER 289 - Re K (deceased) [1985] 1 Ch 85 - Lenaghan-Britton v Taylor (unrep., NSWSC 26 May 1996, Hodgson CJ in Eq) - S-T v J [1997] 3 WLR 1287 - Vasiljev v Public Trustee [1974] 2 NSWLR 497
PARTIES :	John Oswald Straede - Plaintiff Terence John Eastwood - First Defendant Debra Michele Myors - Second Defendant
FILE NUMBER(S):	SC 4233/01
COUNSEL:	L.J. Ellison, W. Wilcher - Plaintiff S. Marantelli - First Defendant G.B. Johnston - Second Defendant
SOLICITORS:	Macedone Christie Willis - Plaintiff Eggleston Mitchell Lawyers - First Defendant Hicks & Oakley - Second Defendant

Ex tempore

Introduction

1 By Summons filed on 28 August 2001 and amended on 23 August 2002, the Plaintiff seeks orders under s.6 of the Forfeiture Act 1995 (NSW) (“the Act”) modifying the application of the forfeiture rule, as defined by s.3 of the Act, so as to permit him to obtain the benefit of interests in certain land owned by him in joint tenancy with his late wife, and so as to permit him to obtain the interests devolving to him under his late wife’s Will.

2    The application is opposed by a number of the Deceased’s relatives, who are represented by the Second Defendant. The First Defendant, who is the co-executor of the Deceased’s Will, takes a neutral stance as to whether the forfeiture rule should be modified.

3    To avoid confusion for reasons which will later appear, I will refer to the Plaintiff as John, to his late wife as Cheryl and to his present wife as Truda.

Circumstances of the Deceased’s death

4    On 31 August 2000, John was driving Cheryl to work, as he did every day. It was about 6.20am and still dark. The road was wet from recent rain. The car was gaining ground on a car ahead. Just below the crest of a hill, John decided to overtake the car in front. He crossed over the unbroken double lines. Just as he did so, another car came over the crest of the hill towards him. Both drivers swerved but the two cars collided, passenger side front to passenger side front. Cheryl, who was sitting next to John in the passenger seat, was killed.

5 John was charged with dangerous driving causing death under s.52A(1c) of the Crimes Act 1900 (NSW), the prescribed punishment for which is imprisonment for a maximum period of ten years. John pleaded guilty and on 12 July 2001 he was sentenced by Nield DCJ in the District Court.

6    The learned Judge said this in his sentencing remarks:

“The offender was born on 17 August 1941. Accordingly, he was aged 59 years as at 31 August 2000. He and his wife were married on 1 December 1971. Accordingly, they had been married for 28 years 9 months as at 31 August 2000. He was devoted to his wife. He has been employed as a scientific computer programmer by the Anglo Australian Observatory since 1973. He has an unblemished character and reputation, as confirmed by exhibit X and the 44 testimonials, exhibits 2 to 45 inclusive. He has held a driver’s licence since 1959. In New South Wales his driver’s record reveals a minor driving offence in 1982 (see exhibit Y). He admits to four other driving offences in his statement, exhibit 1, the last being in 1985 or 1986. He is well liked and well respected by his colleagues, his friends and his wife’s family and friends, as confirmed by the testimonials.

I believe that the offender is not the type of person who would drive a car in such a manner as to abandon his responsibility for his driving. Also, in my view the relevant facts, as I have stated them, do not show that the offender was driving his car in such a manner as to have abandoned his responsibilities. Accordingly, I conclude that the collision was due to the offender’s error in judgment. The fact that he made a conscious and deliberate decision to overtake the preceding car and, in order to do so, to drive across the two unbroken white separation lines does not mean that it was not an error of judgment. Thus, I consider that I am not bound to impose a sentence of imprisonment upon the offender. However, having said that, I do not say that a sentence of imprisonment is not an appropriate sentence to impose upon him. I consider that the offender’s error of judgment was a significant one, amounting to a serious breach of appropriate driving of a car.”

7    In the light of John’s “prior good character, relatively good driving record, the death of a family member, early guilty plea, genuine contrition and likelihood of not re-offending” the learned Judge sentenced John to two years imprisonment, with a non-parole period and a parole period of one year each, the non-parole period to be served by periodic detention in Parklea Periodic Detention Centre.

Evidence as to John’s character on sentencing

8    A number of Cheryl’s relatives and friends gave character evidence on John’s behalf at his sentencing. Mrs Floyd gave this evidence:

“I am Cheryl Straede’s sister. I have known John Straede ever since he first began to keep company with my sister over 30 years ago before they were married.

John has always been and will remain a very special person in our family. He deeply loved and was devoted to my sister. She was disabled and John selflessly took on the tasks needed on a daily basis to ensure her comfort and care. He always thought of Cheryl first and himself after. He drove her everywhere she needed to go and then he pushed her in her wheel chair to the final destination.

There are not many people in this world that can selflessly love and care for a disabled person. They are very exceptional people who have a particular empathy and the ability to look beyond the disability and see and feel the heart and soul of the person inside. John is one of these special people. He found Cheryl and they became a unit.

…

My family bears John no incrimination. We do not want him to suffer any more than he is already suffering and will continue to suffer. It would cause us all even more grief if he were sentenced to gaol.”
9    Mrs Eastwood, another sister of Cheryl, gave like evidence. She said this:

“I have always been impressed by John’s caring and loving nature, particularly towards my sister, Cheryl. Cheryl has always had difficulty walking and has needed someone to walk with her and help her balance as she takes each step. John has never failed her. Whenever Cheryl stood up from sitting in a chair John would immediately go to her side and take her arm. Cheryl has achieved very high academic qualifications and had a very important professional career. She was only able to do this because of John’s unswerving devotion and attention to her needs. He gave up his time without hesitation to help her in every way he could.

I have always known John to be totally honest and reliable. He is a very intelligent man and does not take his responsibilities lightly. He is generous and thoughtful of others. John loved my sister very dearly. He was a most considerate and loving husband. He misses Cheryl very much and is extremely sorry for having caused this very unfortunate and tragic accident. His life has been totally changed as a result of the accident because retirement plans, that he and Cheryl had, will now never be realised. His future life will be without the wife and companion that he most dearly loved. Cheryl and John had many shared interests.”
10    Mr Eastwood, John’s brother-in-law and co-executor of Cheryl’s estate, said:

“John’s devotion to Cheryl was obvious to those who knew them. Cheryl had a progressive debilitating physical condition that required her to be assisted whenever she walked and travelled. John provided this assistance to Cheryl unreservedly. I have watched John and Cheryl grow as a devoted couple and observed how, as Cheryl’s physical independence decreased, John increased his attentativeness [sic] to her needs without hesitation.

Without John providing with door-to-door transport to and from work and her studies, Cheryl would not have achieved her remarkable academic and professional successes. John was ‘Cheryl’s mobility’.

John has been devastated by the result of his action. Even now, six months after the accident, he becomes emotionally distressed about it when we talk about matters that trigger off his personal memories of Cheryl. His grief is real, his loss is great, and he will carry his guilt for the rest of his life.”
11    Ms Jennifer Game, a close friend of Cheryl, gave this evidence:

“John and Cheryl complemented each other in that her physical frailty made her dependent on him while his emotional frailty made him dependent on her. Since the accident John has suffered a great deal, in part because of his feelings of guilt and because he genuinely relied on her for so much friendship and emotional connectivity to the world.

I understand that John has been charged with dangerous driving occasioning death.

In my view John is genuinely remorseful about the accident. Cheryl’s loss will be felt by him for the remaining days of his life.

I can see no advantage to the community in a custodial sentence. A custodial sentence would in my view move John closer to suicide.

Cheryl was a great person and an inspiration to those who had the pleasure of knowing her. She found in John a lifelong friend and I am quite sure that she would not want to see him further punished.”

12    Unfortunately, Mrs Floyd, Ms Game and other relatives of Cheryl presented to me a picture of the relationship between John and Cheryl which was very markedly different from the picture that had been presented to Nield DCJ. As I have noted, the First Defendant, Mr Eastwood, takes a neutral stance but the Second Defendant, Ms Debra Myors, a sister of Cheryl, who has been joined as a party in these proceedings to represent other beneficiaries under Cheryl’s Will, strongly opposes the granting of John’s application.

Second Defendant’s submissions

13    Mr Johnston of Counsel, who appears for Ms Myors, submits that:


a) John was guilty of immoral conduct during his marriage to Cheryl in that he had a long extra-marital relationship with Truda, whom he has since married;

b) in determining whether justice requires the effect of the forfeiture rule to be modified, the Court is to have regard under s.5(3)(a) and (d) of the Act, inter alia, to “the conduct of the offender [John] ” and “to such other matters as appear to the Court to be material” ;

c) because John makes his claim for relief as a married person, the Court should have regard to his immoral conduct during his marriage to Cheryl. It would outrage the community that John should take a benefit under his wife’s will and should, in order to do so, have the assistance of the Court under the Forfeiture Act ;

d) the Court should also have regard to the intentions of Cheryl, the size of her estate, John’s financial position and the moral claims and wishes of those who would be entitled to benefit under her Will if the effect of the forfeiture rule were not modified: Dunbar v Plant [1997] 4 All ER 289, at 302;

e) having regard to all of those circumstances, John’s application should be dismissed.


The Act

14 The provisions of the Act, in so far as they are relevant to this case, are as follows. Section 4(1)(a) provides that the Act applies to an unlawful killing, whether occurring within or outside the State of New South Wales.


Section 3 defines “unlawful killing” as any homicide committed in the State that is an offence.

Section 5 provides:

“(1) If a person has unlawfully killed another person and is thereby precluded by the forfeiture rule from obtaining a benefit, any interested person may make an application to the Supreme Court for an order modifying the effect of the rule.

(2) On any such application, the Court may make an order modifying the effect of the forfeiture rule if it is satisfied that justice requires the effect of the rule to be modified.

(3) In determining whether justice requires the effect of the rule to be modified, the Court is to have regard to the following matters:

(a) the conduct of the offender,
(b) the conduct of the deceased person,
(c) the effect of the application of the rule on the offender or any other person,
(d) such other matters as appear to the Court to be material.”

Section 6 provides:

“(1) The Supreme Court may make a forfeiture modification order in such terms and subject to such conditions as the Court thinks fit.

(2) For example, the Court may modify the effect of the forfeiture rule in relation to property:

(a) in the case of more than one interest in the same property (for instance, a joint tenancy) affected by the rule ---by excluding the operation of the rule in relation to any or all of the interests, and

(b) in the case of an offender who has an interest in real property (such as a family home) and personal property affected by the rule – by excluding the application of the rule in relation to all the property or some of the property.

(3) If the Court makes a forfeiture modification order, the forfeiture rule is to have effect for all purposes (including purposes relating to anything done before the order was made) subject to modifications made by the order.”

The marriage and the ménage à trois

15    John was born in 1941 and Cheryl was born in 1951. Cheryl suffered from a congenital disability, Charcot-Mare Tooth disease, which became more and more debilitating and disabling as she grew older.

16    Cheryl’s family lived in Melbourne and Cheryl was able to attend normal school, although she left at an early age. After several years’ work, Cheryl enrolled at university as a mature age student and obtained a Bachelor of Arts degree. Subsequently, she obtained the degrees of Master of Letters in Literature and Master of Clinical Psychology. She was admitted to the College of Clinical Psychologists.

17    Cheryl met John in the late 1960s and they were married in December 1971. They had no children; John had a vasectomy because it would have been very injurious to Cheryl’s health if she had fallen pregnant. They lived in Melbourne for a few years and finally moved to Sydney. They purchased a number of properties together and eventually bought a house at Epping. John worked as a computer programmer for the Anglo-Australian Observatory at Eastwood and Cheryl worked first for the Department of Health and later for the Australian Taxation Office at Chatswood.

18    John and Cheryl shared a number of interests and hobbies, the main hobby being cat breeding. In about 1979, John and Cheryl met Truda, who was also a highly enthusiastic cat breeder.

19    John, Cheryl and Truda became friends. According to Truda’s unchallenged evidence, a sexual relationship commenced between her and Cheryl and lasted for about two or three years thereafter. Truda says that it was Cheryl who suggested that Truda move in to live with her and John. Truda did so. Thereafter the three shared the same bedroom for some time and for some months John had sexual relations with one or other woman in the presence of the other. This evidence to some degree is corroborated by John, and I accept it.

20    In about February 1983, a “ceremony of commitment” was held at John and Cheryl’s home at Epping. In the presence of about twenty guests, Truda made a commitment to the ménage à trois, and promised that they would all look after each other and share their property. Cheryl was present at the ceremony but, apparently, she did not actively participate.

21    Shortly after the “ceremony of commitment” Truda changed her surname to Straede and transferred a property which she owned at South Maroota into the names of John, Cheryl and herself as joint tenants, while John and Cheryl transferred properties which they owned, namely the house at Epping and land at Coonabarabran to Truda and themselves as joint tenants.

22    In about August 1984 John, Cheryl and Truda moved to the land at South Maroota which had previously been owned by Truda alone. The three of them continued to live there until Cheryl’s death. John and Cheryl worked and provided income for the household and Truda devoted most of her time to cat breeding on a large scale. The cat breeding business did not, however, make a profit.

23    The evidence indicates that Cheryl became increasingly disaffected with the ménage à trois, and by about 1996 or 1997 she wished to disengage herself and John from Truda. Although she spoke to family and friends about her desires and consulted a lawyer in 1997, she did not herself leave the relationship. She and John were apparently making plans to move to Melbourne without Truda, but they had not done so by the time of Cheryl’s death.

24    Cheryl died on 31 August 2000. She and John had been married for 28 years and 9 months and they had been living in the ménage à trois with Truda for about 20 years. John married Truda on 27 May 2001.

Cheryl’s Will

25    On 1 February 2000, Cheryl made a Will. She drew it herself without legal assistance and its terms are not entirely clear. Omitting formal parts, the Will relevantly provides as follows:

“2. I APPOINT as my Executors and Trustees my Husband JOHN OSWALD STRAEDE and my brother-in-law TERRENCE JOHN EASTWOOD in this Will who I refer to as “my Executors”.

3. MY HUSBAND IS JOHN OSWALD STRAEDE and is hereafter be referred to as “my Husband”.

4. THE PROPERTY REFERRED TO IN THIS WILL IS 25 Railway Road Carnegie, Victoria and is hereafter be referred to as “my property”.

5. MY UNIT AT 3/37 FAWKNER ST, SOUTH YARRA is to be sold and consider as part of the remainder of my Estate.

6. MY EXECUTORS shall hold the whole of my Estate on trust:–

(a) To pay all my just debts, funeral and testamentary expenses, and any Probate Duties payable in connection with my Estate;

(b) If my husband JOHN OSWALD STRAEDE survives me:

(i) within three months of my death my husband must elect to reside or not reside at my property, and must take up residence no later than two years after my death. Rent collected from my property during this two years is to be considered as part of the residue of my estate.

(ii) should my husband elect not to reside at my property or not move by the set date my property is to be sold and the fund obtained to be divided equally between my surviving NEPHEWS and NIECES.

(iii) to hold my property known as 25 Railway Road, Carnegie, Victoria on trust for my husband JOHN OSWALD STRAEDE for his life unless paragraphs (6)(b)(i) or (6)(b)(ii) are enacted.

(iv) my Husband shall pay the premiums on any insurance policies taken out by my Executors on my property, pay the rates, taxes and other outgoings in respect of my property, and keep the property in good repair.

(v) my husband may receive rent from the property to provide for his accommodation in such housing as a nursing home or assisted care establishment.

(vi) my husband may sell or otherwise dispose of my property and purchase, rent, or acquire rights in or right to occupy all or part of accommodation in any alternate home, home unit, strata title, retirement village, nursing home, or assisted care establishment except for paragraph 6(b)(vii) below.

(vii) my husband may NOT rent, sell or otherwise dispose of my property to provide for his accommodation at any property cohabited by Dr TRUDA MARY STRAEDE currently of Vale Ridge, Days Road, South Maroota, New South Wales.

(viii) on the death of my husband, my property or any home substituted as the property together with any fund which may have arisen from the sale or rent from my property shall become part of the residue of my estate.

(ix) to give to my Husband the household chattels that belong to me and are currently in the care of my sisters (see attachment A).

(x) to give to my husband those articles identified in attachment B for his life.

(xi) on the death of my Husband, the articles identified in attachment B are to be given to my surviving sisters.

(xii) to give individually itemised articles as per attachment B.

(c) As to the residue of my estate, one half to my Husband JOHN OSWALD STRAEDE.

(d) As to the balance equally between my surviving NEPHEWS and NIECES.

(e) In the event that my Husband JOHN OSWALD STRAEDE dies during my lifetime then the share he would otherwise have taken shall be divided equally between my surviving NEPHEWS and NIECES.

THE INTENT OF THIS WILL IS TO PROVIDE FOR JOHN OSWALD STRAEDE BUT NOT TO PROVIDE FOR TRUDA MARY STRAEDE.”

Immorality and public policy

26    John and Cheryl were married according to the rites of the Catholic Church. Doubtless, they exchanged vows of marital fidelity. Mr Johnston says that John’s relationship with Truda during his marriage to Cheryl was immoral in that he broke his marriage vow of fidelity. He says that that conduct must be taken into account in a decision as to whether the effect of the forfeiture rule should be modified. Initially, Mr Johnston submitted that John’s application should be dismissed as a matter of public policy. He said that John’s immoral conduct attracted the operation of the maxim “ex turpi causa non oritur actio”, a maxim which, as Lord Wright MR observed, is “notwithstanding the dignity of the learned language, like most maxims, lacking in precise definition” : Beresford v Royal Insurance Company Ltd [1937] 2 KB 197, at 219-220. Mr Johnston ultimately withdrew that submission, but he does say that the conduct of John should weigh heavily in the exercise of the Court’s discretion under s.5 of the Act.

27    Mr Johnston places strong reliance on the decision of the English Court of Appeal in S-T v J (1997) 3 WLR 1287. In that case the appellant, who was biologically a woman but regarded herself as male, entered into a marriage with another woman, the respondent. As part of the preliminary formalities to the marriage, the appellant signed a statutory declaration stating that she was a bachelor and therefore free to marry. The respondent believed that the appellant was a man and continued to believe that she was a man during the seventeen years or so that the couple lived together as man and wife. Eventually, the respondent discovered the appellant’s birth certificate, which showed that the appellant was a woman. The respondent petitioned for dissolution of the marriage and the appellant applied for support and ancillary relief under the United Kingdom Matrimonial Causes Act .

28    The trial judge refused to entertain the appellant’s application on the ground of public policy, saying that the appellant’s claim to ancillary relief under the Matrimonial Causes Act was founded upon her perjury in falsely swearing, at the time of the marriage, that she was a male and therefore free to marry the respondent. The Court of Appeal dismissed the appeal.

29    Ward LJ dissented from the majority Judges in holding, as the trial judge had done, that the appellant’s claim should be dismissed without a hearing on the merits because it was a claim which the Court would not entertain as a matter of public policy. The majority Judges decided that the claim ought not to have been dismissed on the ground of public policy but, rather, should have been heard on the merits and then dismissed in the exercise of the Court’s discretion.

30    At p.1319, Ward LJ said:

“It seems to me that the answer to the question whether the claim is tainted with turpitude depends not on whether the person against whom the claim is made will suffer disadvantage; but rather on whether there is a discernible public interest which will be damaged by the court’s sanctioning the prosecution of the claim. There must be a legitimate public interest to protect. We have an established system of rules for the classification of objects of public policy protection so that the court will, for example, impeach any claim which is economically against the public interest (restraint of trade) or injurious to good government (trading with the enemy) or to the administration of justice (an example well known in matrimonial law being an agreement to oust the jurisdiction of the court to grant ancillary relief: Hyman v Hyman [1929] AC 601). In another category, there is a system of rules to proscribe acts injurious to morality, and, akin to that, acts injurious to marriage.

There is a public interest in marriage probably because marriage is a public act and marriage confers status which means, per Lord Simon of Glaisdale in The Ampthill Peerage case [1977] AC 547, 577A: “the condition of belonging to a class in society to which the law ascribes peculiar rights and duties, capacities and incapacities.” ”

At p.1325, his Lordship said:
“Since I am still of the view that, properly characterised, the facts of the case boil down to an attempt to gain a benefit which accrues only through wrongdoing, then, in that character, the claim is against public policy and for my part I do not shrink from so finding nor from dismissing the appeal on that basis.”

31    It will be seen at once that the case of S-T v J is very different from the present case and, indeed, it is contrary to Mr Johnston’s submission. In S-T v J the appellant’s claim to relief under the Matrimonial Causes Act was founded upon the very fact that she had contracted a marriage and, as a married person, was entitled to claim relief under the Act. But her status as a married person depended directly upon her wrongdoing in falsely swearing that she was a male. It was on that ground that Ward LJ applied the rule of public policy in holding that the action should have been dismissed at the threshold and it was on that ground that the majority Judges dismissed the appeal in the exercise of the Court’s discretion. In the present case, however, John’s claim to relief under the Forfeiture Act does not depend upon his status as a married person. It depends on his status as a beneficiary under Cheryl’s will and as a joint tenant with Cheryl of certain property and upon the fact that he was convicted of Cheryl’s unlawful killing.

32 I accept that s.5(3)(a) of the Forfeiture Act does not contain any express limitation on the range or type of conduct of the offender to which the Court must have regard in deciding whether justice requires the effect of the forfeiture rule to be modified. This is because an offender's part in the unlawful killing of the deceased and the circumstances bearing on the offender’s culpability will be different in each case, and it will be for the Court in each case to determine what conduct of the offender is relevant to the determination required by s.5(3) and what conduct is not .

33 Nevertheless, it seems to me that in order to qualify as conduct to which the Court must have regard under s.5(3)(a) the conduct of the offender must have some bearing on the very fact which brings into operation the forfeiture rule, that is, the unlawful killing of the deceased. So, for example, in Re K (deceased) [1985] 1 Ch 85, the history of a marriage in which the wife had been violently assaulted by the husband had a direct bearing on the culpability of the wife when, without premeditation, she shot the husband during a violent argument and later sought relief under the United Kingdom Forfeiture Act .

34    Likewise, in Lenaghan--Britton v Taylor (unrep. NSWSC 26 May 1996, per Hodgson CJ in Eq), the long history of the relationship between the plaintiff and her grandmother was directly relevant to the plaintiff's culpability in killing the grandmother in a violent, unpremeditated but provoked attack.

35    In the present case, John's conduct with Truda in the ménage à trois with Cheryl has no bearing whatsoever upon how Cheryl came to die and upon John's role in her death.

36    Mr Johnston says that John comes before the Court bringing a claim under the Forfeiture Act as a married man, that is a man entitled to benefits under his wife's will and that it would outrage the community if the Court were to exercise a discretion in his favour when he had been guilty of immoral conduct with Truda during the marriage.

37    I cannot accept this submission for many reasons. Three will suffice. First, I cannot see why the Court in the exercise of its discretion should express its disapproval and censure of John's lack of marital fidelity when, according to the evidence, John's own wife instigated the ménage à trois and continued to live within it for some twenty years until her death. Second, Cheryl herself did not disapprove of John's conduct sufficiently to regard him as having no further moral claim on her bounty because she made substantial provision for him in her Will made in February 2000. Third, I am by no means sure of what right-minded people in the community would think of this or any ménage à trois in the light of social policies reflected in, for example, the range of dependents entitled to bring claims under the Family Provision Act 1982 (NSW) or in legislation such as s.61B(3A) of the Wills, Probate and Administration Act 1898 (NSW), or the Property (Relationships) Act 1984 (NSW).

38 For these reasons, I do not consider that John's conduct in the ménage à trois during his marriage to Cheryl is conduct to which I should have regard under s.5(3)(a) of the Forfeiture Act . I may say, however, that even if the law compels me to have regard to such conduct, I would not have held that it disentitled John to relief because Cheryl herself did not regard it as warranting the exclusion of John from her testamentary bounty.

Cheryl’s wishes

39 Mr Johnston submits that, under s.5(3)(c) and (d) of the Forfeiture Act , I should have regard to Cheryl's wishes. He says that by 1996 or 1997, Cheryl expressed a desire to leave the ménage à trois and a desire that Truda should not benefit from her death. He says that if John is permitted to take the interests provided in Cheryl’s will, Truda, as John’s present wife, will ultimately benefit as well.

40    Mr Marantelli, who appears for the First Defendant, also says that Cheryl wished to sever the joint tenancies of the properties which she owned with Truda so that some partial modification to the effect of the forfeiture rule should be made in order to reflect this intention.

41    Even if Cheryl’s wishes were relevant in the circumstances of this case (which I doubt), I cannot take Cheryl’s alleged wishes into consideration because I am by no means satisfied that they were as has been alleged. She received legal advice from a family lawyer in April 1997. That advice was concerned with how she might separate herself and her affairs from John or Truda. Cheryl did not thereafter take any step to sever the joint tenancies, as she could have done. Her wishes, in so far as they are at all relevant in the present consideration, are expressed in the Will which she made in February 2000.

Needs of other beneficiaries

42    Mr Johnston submits that I should have regard to the needs of the other beneficiaries under Cheryl's Will. Her estate is not large. Its assets are agreed as follows:

(i) a property at Carnegie in Victoria valued in excess of $300,000;

(ii) cash $296,000 before any deduction for the Executor’s commission;

(iii) a further sum of about $35,000 which will ultimately come from Cheryl’s interest in her deceased mother’s estate.


43    It is true that some of Cheryl's nieces and nephews who will receive a share of the residue under Cheryl’s will would benefit by receipt of a larger sum of money if a modification order in John's favour were not made. Foremost amongst these are the young children of Ms Deborah Myers who are in particularly difficult circumstances.

44    However, the need of other beneficiaries cannot be a sole and independent ground for refusing to make a modification order under the Forfeiture Act . An application for a modification order under the Forfeiture Act cannot be regarded as an opportunity for the Court to make the same sort of adjustment amongst objects of a testator’s bounty as it might do in an application under the Family Provision Act . In an application under the Forfeiture Act the need of beneficiaries is only one of possibly many factors which are relevant to the only question before the Court, namely, whether the effect of the forfeiture rule should be modified in favour of an offender and, if so, to what extent. For example, where there is some culpability of the offender in the death of the deceased such as might move the Court to consider whether a partial modification order should be made, the comparative financial needs of the offender and of other beneficiaries might well be taken into account in determining the extent of the partial modification order.

45    That is not the case here, as Mr Johnston very fairly concedes. He admits that Cheryl's death was an accident. There has not been the slightest suggestion that her death was premeditated or that John sought to profit by it. Accordingly, I am of the view that in the circumstances of this case, justice requires the effect of the forfeiture rule to be modified so that John is entitled to the full benefits and interests conferred upon him by Cheryl's will.

Jurisdiction

46    The final point raised by Mr Johnston concerns the jurisdiction of the Court under the Jurisdiction of Courts (Foreign Land) Act 1989 (NSW). Section 4 of that Act confers on the Court a discretion whether to exercise jurisdiction where, as here, land in another State is concerned. Certain of Cheryl's property passing under the Will, and in respect of which John is granted a life estate, is land in Victoria. Mr Johnston says that this Court should decline to exercise jurisdiction because Victoria has no equivalent of the Forfeiture Act : the common law rule as to forfeiture is still in force in that State.

47    Mr Ellison, who appears for John, submits that that is not a sufficient reason to decline the exercise of jurisdiction. He says, and I agree, that the argument in this case is about a Will, not about the title to land. The parties were domiciled in New South Wales at the date of Cheryl's death, a substantial part of the estate is in New South Wales, Cheryl died in this State, and John was convicted of her unlawful killing in this State. In my opinion, no sufficient reason has been shown which should move the Court to decline the exercise of jurisdiction insofar as its orders may affect land in Victoria.

Joint tenancies

48    Finally, I should observe that the orders sought by John include orders modifying the effect of the forfeiture rule in respect of land in which Truda has an interest as joint tenant. If a modification order were not made, Cheryl having died and John being prevented from taking any part of her interest on survivorship, the result would be that that land would be owned as to one-third by John and two-thirds by Truda.

49    Truda is the only other person interested in the disposition of interests in this land and in a modification order relating to it. She says that she does not wish the forfeiture rule to operate in respect of the land so as to deprive John of the interest therein which he would otherwise take by survivorship on Cheryl's death. That is a very powerful consideration in the circumstances of this case and I see no reason not to give effect to it.

Orders

50    For these reasons, I will make orders in terms of paragraphs 1, 2 and 3 of the Amended Summons.

Costs

51    Earlier this afternoon, I delivered judgment on the Plaintiff’s Amended Summons. There has now been debate before me at length as to what should be the proper costs order resulting from that judgment.

52 The Plaintiff's submission is that the Plaintiff should pay his own costs, as he was seeking an indulgence from the Court for relief under the Act and, accordingly, the deceased's estate should not have to bear the costs of such an application. In my view, that is quite the proper order to make in the circumstances.

53    The Plaintiff then submits that the First Defendant's costs should be paid out of the estate, but on a party/party basis, not on the usual basis of an indemnity. Mr Ellison suggests that the First Defendant's participation in the proceedings after the joinder of the Second Defendant was largely unnecessary, as it was clear that the Second Defendant was going to take the large share, if not the total responsibility, for the running of the opposition to the Plaintiff's claim.

54    I do not think that is the proper way of looking at matters. The First Defendant was the co-executor of the estate and his duties not only included the defence of the Will, to a certain extent, but the placing of relevant matters before the Court. Further, it was quite possible that in the course of the proceedings events would take a sudden turn in an unexpected direction, which would require the First Defendant, in his capacity as executor, to make decisions as to what should be done next.

55    I think that the attitude of the First Defendant has been proper and responsible in the conduct of the proceedings and that he should have his costs out of the estate on an indemnity basis.

56    The Plaintiff then suggested that the Second Defendant should pay her own costs and not have costs out of the estate. The Plaintiff says that the Second Defendant, in effect, totally failed in her opposition to the claim and that there is no good reason why the estate should be burdened with her costs to the detriment of the Plaintiff, who is also a beneficiary, and to the detriment of other beneficiaries who are not represented by the Second Defendant.

57    Mr Johnston says that the Second Defendant's participation was not only justified, but was necessary. He says that it was clear that the First Defendant would not place before the Court the evidence as to Mr Straede's conduct during the marriage, which the Second Defendant believed, no doubt upon legal advice, to be material which should be placed before the Court, particularly as the Court was exercising a jurisdiction which comprised a substantial discretionary element.

58    I have come to the conclusion that the evidence which the Second Defendant placed before the Court as to marital conduct was not relevant to the ultimate determination. However, I could not come to the conclusion that it would have been totally unreasonable for any competent lawyer to believe that such evidence could have been relevant to the Court's exercise of discretion. It is a position upon which some minds, I think, may reasonably differ.

59    Further, the Second Defendant wished to make contentions about proper construction of the deceased's Will by way of defence to the Plaintiff's claim. As it turns out, the construction point has not been material to the ultimate determination, but it possibly could have been. It did not appear that the arguments in that respect that the Second Defendant wished to put were to be put by the First Defendant. It seems to me that the Second Defendant, therefore, had a proper concern as to whether arguments which, on one view, could reasonably have been regarded as relevant, were going to be put to the Court.

60    Finally, there is the question of whether the Court should have exercised jurisdiction under the Jurisdiction of Courts (Foreign Land) Act . That question did not occupy a great deal of time in the argument of the parties or in the conduct of the case, but it was, nevertheless, a point which reasonable minds might have thought ought to be placed before the Court.

61    What costs order should be made is, no doubt, a very difficult decision to make in a case like this, where parties on both sides have developed intense and often hostile attitudes. I think that I have to proceed on the basis, in the circumstances of this case, that it was not totally unreasonable for the Second Defendant to seek to place before the Court the evidence as to marital conduct, even though I have come to the firm conclusion that that evidence was irrelevant.

62    I think that the exercise of the Court's discretion as to costs in a case such as this is fairly analogous to the way in which the Court exercises its discretion as to costs in an application under the Family Provision Act , as illustrated in Vasiljev v Public Trustee [1974] 2 NSWLR 497, and particularly at pp503ff.

63    In my opinion, the proper order for costs in relation to the Second Defendant is that her costs should come out of the estate on a party/party basis.

– oOo –

Last Modified: 04/09/2003