Tam v Chen
[2023] VSC 12
•27 January 2023
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
TESTATORS FAMILY MAINTENANCE LIST
S ECI 2019 05415
BETWEEN:
| KA YAN TAM (BY HER LITIGATION GUARDIAN, ANDREW JOHN SIMPSON) | Plaintiff |
| v | |
| YU CHEN (AS EXECUTOR AND TRUSTEE OF THE WILL AND ESTATE OF LAI HUNG YAM (IN THE WILL CALLED YAM DE SOUZA ESQUIVEL LAI HUNG ALSO KNOWN AS LAI HUNG YAM DE SOUZA ESQUIVEL AND YAM DE SOUZA ESQUIVEL, DECEASED)) & ANOR (according to the attached Schedule) | Defendants |
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JUDGE: | Daly AsJ |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 27 September 2022 |
DATE OF JUDGMENT: | 27 January 2023 |
CASE MAY BE CITED AS: | Tam v Chen |
MEDIUM NEUTRAL CITATION: | [2023] VSC 12 |
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ADMINISTRATION AND PROBATE – Application for extension of time to bring an application – Administration and Probate Act 1958 (Vic) s 99 – Maher v Maher [2019] VSCA 161 referred to – Where plaintiff lives with an intellectual disability and mental illness and the proceeding is brought by a litigation guardian – No prejudice – Extension of time granted.
TESTATOR’S FAMILY MAINTENANCE – Application by only child of the deceased for further provision under Part IV of the Administration and Probate Act 1958 (Vic) – Estate held on trust for the benefit of the plaintiff for her lifetime and gifted to the defendants as remaindermen – What amount would constitute adequate provision for the proper maintenance and support of the plaintiff – Adequacy of provision to provide for the plaintiff’s proper maintenance and support – Where the plaintiff lives with a mild intellectual disability and mental illness and relies on government funding and social housing – Adequate and proper is relative to size of estate – Principle of freedom of testation and intentions of the deceased – Where the plaintiff’s needs are currently being adequately met – Relevance of NDIS support – Schmidt v Walter [2019] VSC 385 referred to – Portable life interest order granted to the plaintiff to provide greater flexibility over time.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr J McCoy | Maurice Blackburn Pty Ltd |
| The Defendants in person |
HER HONOUR:
Introduction and background
These reasons concern an application by the plaintiff, Ms Ka Yan Tam (also known as, and referred to in these reasons as ‘Gina’) for orders for further provision from the estate of her later mother, Lai Hung Yam (‘deceased’). As the application was made some 13 months after the expiry of the limitation period prescribed by s 99(1) of the Administration and Probate Act 1958 (Vic) (‘Act’), Gina, who is represented in this proceeding by a litigation guardian, Mr Andrew Simpson, requires an extension of time to bring the application.
Gina has a litigation guardian because she has a mild intellectual disability, and suffers from disabling mental illness, including paranoid schizophrenia, which was diagnosed when she was a teenager. She is 34 years old, is unlikely to ever be able to work, and, according to the litigation guardian, ‘is not a person who is capable of forming social connections and relations that will allow her to live independently in society’.
Gina has no contact with her biological father, who lives in Hong Kong. Gina and the deceased arrived in Australia from Hong Kong in about 2001, and the deceased married Gina’s late stepfather, Francisco De Souza Esquivel in about 2003. Following the death of the deceased in October 2017, and the death of her stepfather in October 2018, Gina’s only relatives in Australia are her cousins on her maternal side, Yu Chen (also known as, and referred to in these reasons as ‘Vicki’) and Renjing Jiang (also known as, and referred to in these reasons as ‘Jenni’). Vicki and Jenni, in their capacity as the executors of the deceased’s estate (‘estate’), resist Gina’s claim for further provision from the estate, and are the defendants in this proceeding.
The estate is a small estate. The sole asset of the estate is an apartment in the Mantra Hotel complex in Little Bourke Street, Melbourne (‘apartment’). The parties estimate the value of the apartment as being in the range of $220,000 to $250,000.[1] The apartment generates a modest rental, in the order of $1,750.00 per month. As it is part of the Mantra hotel complex, it is not suitable to be used as a long term residence, and the income generated by the apartment is susceptible to the conditions of the tourism industry. For example, the apartment generated very little income in 2020 and 2021.
[1]The deceased also had a life insurance policy with a Hong Kong based entity valued at US$20,000.00. The will provided that the proceeds of the insurance policy be divided between the defendants, provided that they hold the proceeds on trust to be applied for Gina’s maintenance, welfare and benefit during her lifetime. However, the defendants say they have been unable to redeem the insurance policy owing to the absence of critical original documents, and accordingly, that asset does not fall within the jurisdiction of this Court for the purposes of the current application.
Vicki and Jenni were appointed by the deceased as the executors of the estate in her will made on 25 November 2015 (‘will’). The evidence suggests that at the time the deceased made the will (which appears to have been drawn up by or with the assistance of solicitors) the deceased knew that she was suffering from a terminal illness, being motor neurone disease.
The relevant clauses of the will provide as follows:
3. I MAKE the following specific bequests:
(a)I GIVE AND DEVISE AND BEQUEATH all my rights and interests in my property situate at 504/471 Little Bourke Street, Melbourne 3000 in the State of Victoria (Certificate of Title Volume 10452 Folio 913) to be divided pursuant to the following percentages amongst the following beneficiaries:
(i) Fifty percent (50%) to my niece CHEN YU; and
(ii) Fifty percent (50%) to my niece RENJING JIANG;
provided that my nieces CHEN YU and RENJING JIANG receive the rental income of my property and hold such income on Trust to apply towards the maintenance, welfare and benefit of my daughter TAM KA YAN care of [address] in the State of Victoria. I DIRECT that my nieces CHEN YU and RENJIANG JIANG are NOT PERMITTED to sell my property, until my daughter TAM KA YAN passes away.
(b)I GIVE AND DEVISE AND BEQUEATH all my insurance/death benefit monies (including all my insurance/death benefit monies that I have in Hong Kong in the company DAH SING LIFE ASSURANCE COMPANY LIMITED) to be divided pursuant to the following percentages amongst the following beneficiaries:
(i) Fifty percent (50%) to my niece CHEN YU; and
(ii) Fifty percent (50%) to my niece RENJING JIANG;
provided that my CHEN YU and RENJING JIANG hold my insurance/death benefit monies on Trust and apply such monies towards the maintenance, welfare and benefit of my daughter TAM KA YAN care of [address] in the State of Victoria.
4.IN THE EVENT THAT my daughter TAM KA YAN passes away then I GIVE AND DEVISE AND BEQUEATH the residue of my real and personal Estate to be divided pursuant to the following percentages amongst the following beneficiaries:
(a) Thirty five percent (35%) to my niece CHEN YU;
(b) Thirty five percent (35%) to my niece RENJING JIANG; and
(c) Thirty percent (30%) to my nephew REN KUAN LI;
absolutely.
Accordingly, the defendants have, in effect, a remainder interest in the sole asset of the estate.[2]
[2]The parties appear to have proceeded on the basis that the upon Gina’s death, the proceeds of sale of the apartment will pass to the defendants and the deceased’s nephew in accordance with clause 4 of the will. I do not read the will that way, as clause 4 refers to the residue of the estate, not the apartment. However, little turns upon that for the purposes of the current application.
Probate of the will was granted to Vicki and Jenni in April 2018. Since that time, the income from the apartment has been used to supplement Gina’s income from Centrelink, and to fund shopping excursions and other outings organised by Vicki and/or Jenni, along with funding additional expenses such as piano lessons. The expenditure from the estate has been recorded by Vicki and Jenni in spreadsheets annexed to Vicki’s affidavit. The spreadsheets show that Vicki and/or Jenni regularly visited Gina at her home and in hospital, had Gina visit their homes for celebrations such as Christmas and Chinese New Year, and took her shopping, with there being some explicable gaps in 2020 and 2021. It appears that Vicki and Jenni used funds from the estate to reimburse themselves for fuel used by them to transport Gina on their outings and visits, to contribute to the cost of shared meals, and to provide Gina with modest amounts of cash, but since February 2022, the net rental income from the apartment has been paid directly into Gina’s bank account.
As might be expected, Gina’s financial position is quite modest. She receives a Disability Support Pension from Centrelink (which, with supplements, amounts to $944.30 per fortnight), and, since February 2022, approximately $1,350.00 per month from the net rental income of the apartment. She pays one quarter of her income from Centrelink to the Department of Families, Fairness and Housing (‘DFFH’) in rent for a two bedroom villa unit in Braybrook, where she has been living since 2010. Unless there is a dramatic shift in public policy at the Commonwealth and State level, she should be able to rely upon income support and secure housing for the rest of her life given her disabilities. However, she has on occasion struggled with independent living, undergoing a lengthy period of hospitalisation in 2017 to 2019, and often fails to purchase adequate food and toiletries for herself in order to save money.
Sometime in 2019, Gina received the sum of $250,000 (‘settlement fund’) in settlement of a claim by her against the estate of her late step-father. Some of the legal fees incurred by Gina in that proceeding were funded by the estate, such that I can infer that Vicki and Jenni were involved in that proceeding, the litigation guardian only having been appointed after the settlement of that proceeding. The settlement fund is held for Gina by the Senior Master – Funds in Court. It seems that there have been no disbursements from the settlement fund to date.
In late 2018, an application was made by a psychologist working with the Mid West Area Mental Health Service, based at Sunshine Hospital, to the Victorian Civil and Administrative Tribunal (‘VCAT’) for the appointment of a financial guardian to administer Gina’s financial affairs, relying upon ‘Gina’s chronic mental illness and impaired judgment which has led to her poor budgeting, financial vulnerability, poor self-care and disorganised behaviour, and inadequate personal and professional supports being in place’.
However, VCAT declined to appoint a financial guardian, forming the view that Gina is in fact capable of managing her financial affairs, but did appoint the Office of the Public Advocate (‘OPA’) to act as Gina’s administrator for the purpose of making decisions regarding Gina’s accommodation, medical treatment, and engagement with support services.
Since returning to her home in 2019 following her hospitalisation, Gina has received significant support through the National Disability Insurance Scheme (‘NDIS’). Through Gina’s current NDIS plan, which covers the period from April 2020 to April 2023, Gina receives funding of $123,022.85 for, among other things, a support worker to assist her to live independently within her own home, and funds for private transport for shopping and medical appointments. An officer of the OPA is the nominated contact person for Gina’s NDIS plan.
According to Vicki, the services and support provided by the NDIS have been life changing for Gina. NDIS funded support workers assist Gina with home cleaning, personal hygiene, food shopping and preparation, transport, medication management and in ensuring she keeps her appointments with medical professionals and mental health support services. Gina’s NDIS plan is due to be reviewed in April 2023. Again, it seems to me that, given the extent of Gina’s disabilities, and their permanency, there would need to be a substantial change in government policy and/or funding for there to be a substantial reduction in the support services available to Gina through the NDIS in the foreseeable future.
The issues in this proceeding
In her originating motion filed on 27 November 2019, Gina (via her litigation guardian) seeks the following orders:
(a) an order pursuant to s 99(2) of the Act for an extension of time to bring a claim under part IV of the Act; and
(b) an order for further provision from the estate.
Gina seeks that the whole of the estate be paid to her, absolutely.
There is no question that Gina, as the only child of the deceased, is an eligible person within the meaning of s 90 of the Act.[3] There is also no question as to whether the deceased, at the time of her death, owed a moral duty to provide for the maintenance and support of Gina, who is extremely poorly equipped to take care of herself without the support of the community and her family. What is in dispute is the adequacy of the provision made by the deceased for Gina in the will, from what is, in contemporary terms, a very modest estate.
[3]Section 90 of the Act provides that an ‘eligible person’ includes a child with a disability. Section 91(4) of the Act in effect provides that a claimant who is an adult child of the deceased with a disability does not need to positively establish that they are not capable of making adequate provision for their own proper maintenance and support in order to obtain further provision from their late parent’s estate, unlike adult children without a disability.
The litigation guardian says that the terms of the will do not provide adequate security and flexibility for Gina. While the stipulation in the will that the apartment not be sold during Gina’s lifetime was understandable, given that the deceased may well have been concerned that Gina could be vulnerable to exploitation if the apartment was sold and she had access to significant amounts of cash, those concerns could be allayed by the appointment of an administrator, or the payment of any proceeds of sale to the Senior Master.
At first glance, the arguments advanced on behalf of Gina in support of her application to obtain an absolute entitlement to the whole of the estate seem quite compelling, given her disabilities, her financial circumstances, the size of the estate, the more distant family relationship between the deceased and the beneficiaries, and the absence of any evidence of any real competing needs on the part of the beneficiaries. However, discussed in more detail later in these reasons, the position is somewhat more complicated than might first appear.
Essentially, the defendants say that Gina’s needs are being met by her income (as supplemented by the rent from the apartment), her secure housing through DFFH, and the support services provided through the NDIS. They say that the deceased made the will knowing she had a terminal illness, in circumstances where she had sought and obtained promises from Vicki and Jenni that they would remain actively involved in Gina’s life, and those promises have been kept by Vicki and Jenni since the death of the deceased. While the terms of the will do not provide for a ‘cash for services’ exchange as such, the gift of what is effectively a remainder interest in the estate to the defendants represents a recognition of and reward for their ongoing care for Gina and involvement in her life.
The evidence before the Court and the parties’ submissions
Given the relatively narrow scope of the issues in dispute in this proceeding, the parties relied upon relatively limited evidence. An agreed court book was filed. The court book included an agreed statement of facts prepared by the litigation guardian, which provides as follows:
1.The deceased, Lai Hung Yam (‘the deceased’), died on 27 October 2017 at the age of 60 years.
2.The deceased was survived by her husband, Francisco Jose De Souza Esquivel (‘Francisco’), and her daughter, Ka Yan Tam (‘the plaintiff’). The plaintiff was the deceased’s only child.
3. Francisco, who was the plaintiff’s step-father, died on 30 October 2018.
4. On 25 November 2015, the deceased made her last Will (‘the Will’).
5.The Will appoints the deceased’s nieces, Chen Yu (also known as Victoria Chen) (‘Victoria’) and Renjing Jiang (also known as Jennifer Renjing) (‘Jennifer’) (together, ‘the defendants’), as executors and trustees of the deceased’s estate.
6. The Will provides for the following:
(a)The apartment located at 504/471 Little Bourke Street, Melbourne, (‘the Mantra apartment’) to be divided between the defendants in equal shares, subject to the defendants receiving the rental income on the property and holding it on trust for the plaintiff’s maintenance, welfare and benefit and a direction that the property not be sold until the plaintiff passes away.
(b)The deceased’s life insurance and death benefits to be divided equally between the defendants, provided that the defendants hold those monies on trust for the maintenance, welfare and benefit of the plaintiff.
(c)In the event that the plaintiff passes away, the residue of the estate is left as to 35 per cent to Victoria, as to 35 per cent to Jennifer, and as to 30 per cent to the deceased’s nephew, Ren Kuan Li, absolutely.
7.On 18 April 2018, the Supreme Court of Victoria granted probate of the Will to the defendants.
8.On 28 November 2019, Andrew John Simpson, solicitor, was appointed to act as the plaintiff’s litigation guardian in this proceeding. He had not relationship with the plaintiff prior to his appointment.
9.According to the inventory of assets and liabilities filed by the defendants in support of the application for probate of the Will (‘the inventory’), the deceased’s estate solely consists of the Mantra apartment, valued at $220,000.
10.Accordingly, the net estate pursuant to the inventory is valued at $220,000. However, the inventory omits the deceased’s life insurance and death benefits of approximately $29,000.00. The estate has no liabilities.
11. The plaintiff is now aged 33 years.
12.The plaintiff has an intellectual impairment and a long history of paranoid schizophrenia. She has had multiple psychiatric admissions since 2003. The plaintiff also has a longstanding diagnosis of mild intellectual disability.
13.The plaintiff does not have an administrator to manage her financial affairs.
14. The plaintiff is on a National Disability Insurance Agency Plan.
15. The plaintiff receives a Centrelink Disability Support Pension.
16.The sum of $250,000 is held on behalf of the plaintiff by the Senior Master of the Supreme Court.
At trial, the defendants confirmed that they did not dispute any of the matters referred to in the agreed statement of facts, such that those facts are deemed to have been proved by reason of s 191 of the Evidence Act 2008 (Vic).
The litigation guardian relied upon position papers filed on 1 February 2022 and 23 March 2022, along with the following documents:
(a) the will;
(b) the grant of probate and inventory of assets and liabilities;
(c) Gina’s tenancy agreement with DFFH, along with an email from an officer of DFFH regarding the duration and terms of Gina’s tenancy;
(d) Centrelink documents concerning Gina’s income;
(e) documents concerning the application to VCAT, which provide considerable detail about Gina’s disabilities and living circumstances; and
(f) Gina’s NDIS plans prepared in 2019 and 2020.
The litigation guardian’s first position paper, filed on 1 February 2022, set out what are largely agreed factual matters, and submitted, in summary, as follows:
(a) while DFFH has advised that Gina can remain living at her current property while she meets the requirements of the Residential Tenancies Act 1997 (Vic) (‘RTA’), there is no certainty as to what those requirements may be in the future, and DFFH may terminate the tenancy in accordance with the provisions of the RTA;
(b) it would be impossible for Gina to continue to maintain her housing without the assistance of the NDIS;
(c) the purchase of a two bedroom unit in the Footscray area would ensure that she would be near her services and the defendants;
(d) Gina would need funds for the purchase of furniture and other relocation expenses, and a fund to assist with maintenance and other outgoings, the latter which could be funded from the portion of her income currently paid as rent;
(e) the beneficiaries have not provided any evidence of their personal financial circumstances, and, as the nieces and nephew of the deceased, are not people to whom the deceased owed a moral duty; and
(f) the position paper concluded as follows:
The provision made for the plaintiff in the Will is inadequate to provide for the plaintiff’s proper maintenance and support in view of the her significant care needs. The litigation guardian submits that there is uncertainty in the security of the plaintiff’s current accommodation moving forward and her interests are best served by obtaining a suitable property in her own name to meet her housing needs.
The plaintiff is a child of the deceased and is a person under disability. The plaintiff will require support for the rest of her life. She has no chance of obtaining gainful employment or establishing financial security. The deceased had a moral obligation to provide adequate provision for her daughter’s proper maintenance and support and has failed to do so.
The defendants relied upon two affidavits sworn by Vicki on 4 February 2022 (‘first affidavit’) and 25 March 2022 (‘second affidavit’). In the first affidavit, Vicki responded to the matters raised by the litigation guardian’s first position statement, and, among other things, deposed as follows:
The background for my Aunty Yam wrote this will is she would like us to keep treat the plaintiff as part of the family, look after the plaintiff’s best interest and give her some enjoyment in life, such as shopping/dining/travelling without worry about the money. As a reward, after the Plaintiff passed away, then we can sell the apartment and distribute among the beneficiaries.
Yam’s Will has imposed a lot of restrictions, if we spend, we can only spend on the Plaintiff, we can only sell the property after the Plaintiff passed away. The main purpose for that is Yam wanted the Plaintiff to know that her love and care for the plaintiff will not finish even though she left.
Before Yam passed away, she specifically held a family meeting and advised all the family member that she did not want the property to be sold. This instruction was reinforced by the wording in her will ‘NOT PERMITTED TO SELL MY PROPERTY, UNTIL MY DAUGHTER TAM KA YAN PASSES AWAY’.
Vicki annexed the following documents to the first affidavit:
(a) an email to Gina’s former solicitors from Gina’s caseworker at the OPA dated 11 October 2021 (‘OPA email’) expressing the OPA’s reasons for not supporting the litigation guardian’s application in this proceeding;
(b) an email from the manager of the apartment confirming that from 1 February 2022 the net rental income from the apartment would be transferred directly to Gina’s bank account; and
(c) a bundle of spreadsheets titled ‘Estate account distribution statement from 2 October 2017 to 2 February 2022’ (see paragraph 8 of these reasons).
In the position paper in reply filed by the litigation guardian on 23 March 2022, the following submissions were made in response to the evidence and submissions relied upon by the defendants:
(a) given Gina’s age, it is uncertain what her needs will be in the future. The primary purpose of bringing this proceeding is to enable Gina to access the capital value of the apartment to provide for a fund to meet the vicissitudes of life;
(b) the funding received by Gina from the NDIS is not guaranteed;
(c) in response to the OPA email, the litigation guardian submitted that the OPA is not in a position to make assessments about Gina’s financial well-being or future needs;
(d) there is a conflict of interest between Gina and the defendants, with the defendants appearing to hold the view that the terms of the will are intended to reward them for looking after Gina; and
(e) the defendants’ view as to the likely net proceeds of sale from the apartment is very pessimistic.
In the second affidavit, Vicki responded to the litigation guardian’s second position statement, and, in summary, took issue with the contention that it was in Gina’s best interests for the apartment to be sold and the proceeds paid to her absolutely.
Vicki deposed as to her opinion that Gina had no need to access the capital tied up in the apartment, and that the sale of the apartment would only net the sum of $100,000, which would not be enough to purchase a suitable home for Gina. She deposed as follows:
It was the deceased’s will that we keep Gina as family, make sure Gina’s interest is protected and kept the Mantra property till Gina passed away, it is Gina’s wish to maintain the current housing and financial arrangement.
There is no evidence before the judge showing that Gina has need to access the capital, there is no evidence before the judge showing that Gina has no adequate financial support, there is no evidence before the judge showing that Gina’s public housing is insecure, there is no medical evidence before the judge showing that Gina will have a short life span…
The parties’ written submissions largely mirrored the contentions put forward in their position statements and affidavits. Annexed to the litigation guardian’s written submissions was a table setting out a number of objections to parts of the first and second affidavits. Given that the defendants were self-represented, I decided, with the concurrence of the litigation guardian, to determine the objections in the course of giving these reasons.
The objections largely fell within the following categories:
(a) many of the statements made by Vicki were really expressions of opinion, or were in the nature of submissions, rather than evidence of factual matters;
(b) the evidence was hearsay evidence, in particular, the contents of the OPA email; and
(c) some of the evidence which sought to challenge the motives of the litigation guardian in bringing this proceeding was said to be irrelevant and prejudicial.
The objections are largely valid, save for the objection to Vicki’s evidence that the settlement fund has not yet been accessed, which is evidence of a factual matter which is uncontested by the litigation guardian. Further, I have admitted the evidence insofar as it is evidence regarding the deceased’s reasons for making the will.[4] However, where the objection to the evidence was made on the basis that the evidence is opinion evidence, or is really in the nature of submissions, I have treated that evidence as if it was a submission made by the defendants. As for the evidence critical of the litigation guardian, during the course of the hearing, I informed the parties that I would proceed on the basis that all of the parties involved in this proceeding were motivated by Gina’s best interests, and the defendants seemed to agree with that approach.
[4]Section 94(c) of the Act provides that the Court ‘may accept any evidence of the deceased’s reasons for making the dispositions in his or her will … and for not making proper provision for the applicant, whether or not the evidence is in writing’. I consider that this provision impliedly abrogates the hearsay rule, given that any evidence about what the deceased told the defendants must, if accepted, amount to evidence of a representation made by the deceased.
As for the OPA email, I did give some consideration as to whether the exception to the hearsay rule in s 69 of the Evidence Act 2008 (Vic) applied, on the basis that the OPA email was a business record of the OPA. However, even if the OPA email was a business record of the OPA, it is tolerably clear from its contents that it was prepared for the purpose of conducting, or in contemplation of this proceeding, such that the exception does not apply.[5] Accordingly, the OPA email is inadmissible as evidence in this proceeding, but I consider that I am entitled to draw an inference that the OPA personnel tasked by VCAT with responsibility for managing Gina’s accommodation and support services do not support the litigation guardian’s application in this proceeding: if the OPA did support the application, no doubt a representative of the OPA would have given evidence to that effect.
[5]See s 69(3)(a) of the Evidence Act2008 (Vic).
The defendants were given the opportunity to give evidence and make submissions at the trial. While the boundary between what was evidence and what were really submissions was a little porous, this was not particularly problematic, given that I formed the view that the defendants were honest and well-intentioned. Further, allowances needed to be made given that the defendants were self-represented, and, while no interpreters were required, it was plainly obvious that English was not their first language.
Vicki’s evidence at trial (much of which was given in response to questions asked by me) and submissions were to the following effect:
(a) the deceased made the will when she had motor neurone disease. The deceased wanted the defendants to remain involved in Gina’s life and to look after the estate, to take her out for meals, go shopping, give her some enjoyment in life, and maintain the family connection;
(b) the defendants have kept their promise to the deceased, and receive no benefit from the estate while Gina is alive;
(c) Gina is able to manage her income and go shopping for herself, but cannot or will not cook and clean for herself, or properly manage her personal hygiene. She agreed with my suggestion that Gina was in some respects like a child;
(d) Gina’s NDIS plan provides a social worker to help her everyday with shopping for groceries, doctors’ appointments, and to generally act as a ‘private chauffer’ for Gina, and Gina is very happy with the support provided to her;
(e) without the NDIS, the estate would have to pay for support for Gina from the income from the apartment;
(f) the deceased knew for some time that she had a terminal illness, and thought about the contents of her will for a year. The deceased wanted to protect Gina’s interests and maintain family connections. Gina has no other family apart from the defendants, her father lives in Hong Kong and is not involved in her life, and Gina’s only regular contact is with the defendants and her social workers; and
(g) Gina’s social workers always call her or Jenni if they need assistance in supporting Gina.
Vicki submitted that the terms of the will reflected a balance between the interests of Gina having family involved in her life and the interests of the family members involved in Gina’s life. Gina is a cousin, not a child of the defendants, and they each have their own responsibilities and stresses in life. She submitted that Gina is very well supported by the government and the OPA.
Jenni’s submissions were very brief, and she did not give evidence. Jenni confirmed that she agreed with Vicki’s submissions, and that she wanted to respect the terms of her aunt’s will, because she spent nearly a year formulating her will, in circumstances when she was in a great deal of pain during her illness.
In reply, the litigation guardian accepted that the Court was faced with a ‘delicate situation’ in this proceeding, but submitted that the will was drafted in a way which was too narrow to allow flexibility and security for Gina in the future. The litigation guardian accepted that the deceased no doubt gave careful consideration to what provision she should make for Gina and what would be the best outcome in the circumstances. The litigation guardian conceded that it may not be possible to combine the net proceeds of sale of the apartment with the settlement fund to raise sufficient funds to purchase a suitable home for Gina, but submitted that Gina should have access to the capital in the estate to meet her future needs as they arise, and that making an order for further provision does not preclude the defendants from maintaining their involvement in Gina’s life.
The requirements of the Act and other relevant legal principles
When considering an application for provision under Part IV of the Act, the Court must have regard to certain mandatory relevant considerations, and may have regard to a number of discretionary factors.
Section 91(2) of the Act contains the mandatory relevant considerations, and provides as follows:
(2)The Court must not make a family provision order under subsection (1) unless satisfied—
(a) that the person is an eligible person; and
(b)…
(c)that, at the time of death, the deceased had a moral duty to provide for the eligible person’s proper maintenance and support; and
(d)that the distribution of the deceased’s estate fails to make adequate provision for the proper maintenance and support of the eligible person, whether by—
(i) the deceased’s will (if any); or
...
(4)In determining the amount of provision to be made by a family provision order, if any, the Court must take into account—
(a)the degree to which, at the time of death, the deceased had a moral duty to provide for the eligible person; and
(b)the degree to which the distribution of the deceased’s estate fails to make adequate provision for the proper maintenance and support of the eligible person; and
...
(5)The amount of provision made by a family provision order—
(a)must not provide for an amount greater than is necessary for the eligible person’s proper maintenance and support; and
...
[emphasis added]
Further, s 91A(1) of the Act provides as follows:
Factors to be considered in making family provision order
(1) In making a family provision order, the Court must have regard to—
(a) the deceased’s will, if any; and
(b)any evidence of the deceased’s reasons for making the dispositions in the deceased’s will (if any); and
(c) any other evidence of the deceased’s intentions in relation to providing for the eligible person.
[emphasis added]
Section 91A(2) sets out the discretionary factors which may be taken into account in making a family provision order, as follows:
(2)In making a family provision order, the Court may have regard to the following criteria—
(a)any family or other relationship between the deceased and the eligible person, including—
(i) the nature of the relationship; and
(ii) if relevant, the length of the relationship;
(b)any obligations or responsibilities of the deceased to—
(i)the eligible person; and
(ii) any other eligible person; and
(iii) the beneficiaries of the estate;
(c)the size and nature of the estate of the deceased and any charges and liabilities to which the estate is subject;
(d)the financial resources, including earning capacity, and the financial needs at the time of the hearing and for the foreseeable future of—
(i) the eligible person; and
(ii)any other eligible person; and
(iii) any beneficiary of the estate;
(e)any physical, mental or intellectual disability of any eligible person or any beneficiary of the estate;
(f) the age of the eligible person;
(g)any contribution (not for adequate consideration) of the eligible person to—
(i) building up the estate; or
(ii) the welfare of the deceased or the deceased’s family;
(h)any benefits previously given by the deceased to any eligible person or to any beneficiary;
(i)whether the eligible person was being maintained by the deceased before that deceased’s death either wholly or partly and, if the Court considers it relevant, the extent to which and the basis on which the deceased had done so;
(j) the liability of any other person to maintain the eligible person;
(k)the character and conduct of the eligible person or any other person;
(l)the effects a family provision order would have on the amounts received from the deceased’s estate by other beneficiaries;
(m) any other matter the Court considers relevant.
As previously observed, there is no dispute that Gina is an eligible person, for whom the deceased owed a moral duty to make adequate provision for her proper maintenance and support. However, the defendants do not accept that the will fails to make adequate provision for Gina’s proper maintenance and support.
While I do not propose to undertake a lengthy survey of the authorities regarding what amounts to ‘adequate provision for the proper maintenance and support’ of a claimant under Part IV of the Act, it is clear from the authorities that the terms ‘adequate’ and ‘proper’ have different meanings, and are relative concepts. As stated by Callinan and Heydon JJ in Vigolo v Bostin:[6]
Adequacy of the provision that has been made is not to be decided in a vacuum, or by looking simply to the question whether the applicant has enough upon which to survive or live comfortably. Adequacy or otherwise will depend upon all of the relevant circumstances, which include any promise which the testator made to the applicant, the circumstances in which it was made, and, as here, changes in the arrangements between the parties after it was made. These matters however will never be conclusive. The age, capacities, means, and competing claims, of all of the potential beneficiaries must be taken into account and weighed with all of the other relevant factors.[7]
[6](2005) 221 CLR 191.
[7]Ibid [122].
Accordingly, what might be ‘proper’ provision for a close relative from a small estate might be different to what amounts to ‘proper’ provision from a large estate. Further, while the question of what amounts to adequate provision will necessarily be informed by the financial needs of a claimant, financial need is not necessarily determinative of the matter. The size of the estate and the competing claims of other beneficiaries are also relevant to the question of what amounts to ‘adequate’ provision, as observed by the High Court in Pontifical Society for Propagation of Faith v Scales,[8] referred to with approval by the Court of Appeal in Davison v Kempson,[9] as follows:
It has often been pointed out that very important words in the statute are ‘adequate provision for the proper maintenance and support’ and that each of these words must be given its value. ‘Adequate’ and ‘proper’ in particular must be considered as words which must always be relative. The ‘proper’ maintenance and support of a son claiming a statutory provision must be relative to his age, sex, condition and mode of life and situation generally. What is ‘adequate’ must be relative not only to his needs but to his own capacity and resources for meeting them. There is then a relation to be considered between these matters on the one hand, and on the other, the nature, extent and character of the estate and the other demands upon it, and also what the testator regarded as superior claims or preferable dispositions. The words ‘proper maintenance and support’, although they must be treated as elastic, cannot be pressed beyond their fair meaning. The Court is given not only a discretion as to the nature and amount of the provision it directs but, what is even more important, a discretion as to making a provision at all. All authorities agree that it was never meant that the Court should re-write the will of a testator. Nor was it ever intended that the freedom of testamentary disposition should be so encroached upon that a testator’s decisions expressed in his will have only a prima facie effect, the real dispositive power being vested in the Court.[10]
[8](1962) 107 CLR 9 (‘Scales’).
[9][2018] VSCA 51.
[10]Scales (1962) 107 CLR 9, 19.
A disabled child of a testator would generally be considered to have a strong claim to the estate of their parent or parents.[11] However, there are instances of claims by disabled applicants being refused, or only granted in part, by reason of their failure to establish any particular needs over and above what is provided by government agencies by way of income, accommodation, and support services.[12]
[11]Gunawardena v Kanagaratnam Sri Kantha [2007] NSWSC 151, [82].
[12]Re Watkins [1949] 1 All ER 695; Ridge v Public Trustee [2006] NSWSC 400; Gunawardena v Kanagaratnam Sri Kantha [2007] NSWC 151; Bruce v Matthews [2011] VSC 185; Schmidt v Walter [2021] VSC 444.
Discussion
In determining whether the will provides adequate provision for Gina’s proper maintenance and support, it seems to me that there are three key issues to consider:
(a) whether the prohibition on the sale of the apartment during Gina’s lifetime is unduly restrictive;
(b) whether the provision of what is effectively an informal life interest in the apartment (or any substitute asset, depending upon the answer to (a) above) is adequate provision for Gina’s proper maintenance and support; and
(c) if no to (a) and (b) above, whether Gina should receive an absolute interest in the entirety of the estate, or only part of the estate.
Prior to turning to each of the issues above in turn, I shall make some brief observations about what the evidence discloses about Gina’s needs and her ability to meet those needs with her current level of resources.
In my view, Gina’s needs include the following:
(a) secure, affordable accommodation;
(b) sufficient income to fund the other necessities of life, such as food, utilities, clothing and other personal goods and services;
(c) reasonably intensive support from medical practitioners, support workers, and family;
(d) sufficient income and/or assets to pursue hobbies and other interests, such as watching TV and videos, going shopping, eating out, learning to cook, learning musical instruments, and the occasional holiday, including possibly travelling occasionally to Hong Kong once the travel situation stabilises;
(e) sufficient resources to be able to acquire durable goods such as computers, television sets and other furniture when required; and
(f) sufficient assets to provide flexibility and security as her needs change over time, particularly past the age of 65, noting that there is no reason to assume that Gina will have anything other than the usual life expectancy for a woman of her age.
In order to meet these needs, Gina currently has at her disposal:
(a) secure accommodation in a property she has leased from DFFH since 2010, with rent capped at 25 percent of her income;
(b) income of approximately $772.00 per week from Centrelink and the apartment, from which she pays rent of $260.00 per week and utility costs of approximately $150.00 per week;
(c) a significant funding package from NDIS, which provides Gina with substantial one on one assistance and support, including transport for shopping and medical appointments;
(d) a fund of approximately $250,000.00 to acquire any necessary furniture and other consumer durables, and to meet any unexpected contingencies. Subject to the approval of the Senior Master, it is possible that the part of the settlement fund could be used for holidays, and what funds are remaining could be used to contribute to care and support services not funded by NDIS as Gina’s needs change over time.
There is evidence which indicates that Gina speaks to either or both of Vicki and Jenni by telephone very regularly (perhaps as often as each day), and that Vicki and Jenni are the first port of call for doctors, social workers, and other support people involved in Gina’s life.
If Gina’s application in this proceeding was wholly successful, and the Senior Master was agreeable, the settlement fund could be combined with the net proceeds of the sale of the apartment to purchase a property for Gina to live in. However, it seems to me that in the absence of any reliable evidence as to how much it would cost to purchase a property equivalent to Gina’s current home, there is a real question mark as to whether there would be sufficient funds available to purchase a suitable property for Gina in a suitable location.
In his first position paper filed on 1 February 2022, the litigation guardian submitted that ‘there is uncertainty in the security of the plaintiff’s current accommodation moving forward, and her interests are best served by obtaining a suitable property in her own name to meet her housing needs.’ He submitted that if the apartment was given to her absolutely, the proceeds of sale of the apartment, along with the settlement fund, could be used to purchase a modest two bedroom unit in the Footscray area, close to transport, services, and shopping.
However, as previously indicated, these submissions may be unduly pessimistic about the security afforded to Gina by her current tenancy arrangements, and overly optimistic about whether a property of the kind identified by the litigation guardian in his submissions might realistically be able to be purchased for Gina in the current property market. If the apartment was to realise a sum at the lower end of the valuation range, then, taking into account selling costs and Gina’s legal costs (likely to be in the order of $50,000), there would be little more than $400,000 available to purchase a property for Gina to live in, assuming the Senior Master was agreeable to making all of the settlement fund available for the purchase of a property. Practically speaking then, the likely effect of making an order that an absolute interest in the apartment pass to Gina, and that the apartment be sold, would simply be to augment the settlement fund.
Turning now to the issues identified in paragraph 47 above, my response to the issue in paragraph 47(a) is quite straightforward: the prohibition in the will upon the sale of the apartment during Gina’s lifetime provides insufficient flexibility to meet Gina’s needs over time. While the deceased’s motivation for imposing this prohibition is understandable, the prohibition may prove to be unnecessary and/or unworkable. For example, if the apartment ceased to be managed by Mantra, it may be impractical for the defendants to continue to manage the apartment as an income generating asset. The prohibition on the sale of the apartment may also affect the ability of Gina to move into more intensively supported accommodation if required as she gets older, or her physical and/or mental health deteriorates. Further, while I have some doubt that the total of the settlement fund and the net proceeds of any sale of the apartment would be sufficient to purchase a suitable home for Gina, if there was greater flexibility given to the defendants to sell the apartment, there would be no barrier to the estate co-owning a property with Gina, and providing a life interest in the estate’s share of that property to Gina, if the benefits of home ownership were considered to outweigh the costs.
Accordingly, the requirements of s 91(2) of the Act have been satisfied. At the very least, an order should be made which empowers the defendants to sell the apartment and invest the proceeds elsewhere should Gina’s needs and other circumstances warrant such a course of action. That could be accommodated by making a Crisp[13] order, which would in effect create a portable life interest in the apartment in favour of Gina, and making an order deleting the prohibition in the will upon selling the apartment prior to Gina’s death.
[13]See Crisp v Burns Phillip Trustee Co Ltd [SC(NSW)] Holland J, 18 December 1979, unreported.
However, the real issue of contention in this proceeding is whether the Court should go further, and make an order vesting the apartment (or any substitute asset of the estate) or any part of the estate in Gina absolutely. In determining that question, it is necessary to have regard to the mandatory and discretionary considerations specified by the Act.
Section 91(4) provides that in determining the amount of any order for further provision, the Court must take into account the degree to which the deceased owed a moral duty to Gina and the degree to which the will fails to make adequate provision for Gina’s proper maintenance and support.
Section 91(5) provides that the amount of a family provision order must not provide for an amount greater than is necessary for Gina’s proper maintenance and support. Further, s 91A(1) of the Act provides that in making a family provision order, the Court must have regard to the will, and any other evidence of the deceased’s reasons for making the will in the terms she did, and her intentions in providing for Gina.
Taking each of the mandatory, relevant considerations in turn, I make the following observations:
(a) the deceased’s moral duty towards Gina: there is no question that the deceased owed Gina a moral duty, and, indeed, I accept that she owed no moral duty towards anyone else, including the defendants or either of them;
(b) the degree to which the will fails to make adequate provision for Gina’s proper maintenance and support: this is really the fundamental issue in this proceeding; and
(c) while the question of whether the terms of the will made adequate provision for Gina’s proper maintenance and support is the critical question in the proceeding, it seems to me that it would be difficult to contend, given the size of the estate and Gina’s limited financial resources, that an award to Gina of an absolute interest in the entirety of the estate would be excessive, and would thus infringe s 91(5) of the Act.
A significant (and, as noted above, mandatory) consideration when determining the terms of any family provision order is the terms of the will and the other evidence of the deceased’s intentions in making the will. That the legislature has seen fit to make this a mandatory relevant consideration reflects the importance of the principle of freedom of testation. In the current case, the context in which the will was made is important. Vicki’s evidence was that the deceased made the will knowing that she had a terminal illness, and gave the question of what provision she should make for Gina considerable thought. The deceased sought and received a promise from the defendants, being Gina’s only blood relatives living in Australia, that they would care for Gina and remain involved in her life. The terms of the will, in effect, provided the defendants with a modest reward for that assistance and support, should either or both of them outlive Gina.
While I am not in a position to (and have no need to) conclude that the defendants’ assistance to and support for Gina would not have been forthcoming had it not been for the gift to them in the will (noting that the defendants are older than Gina, such that there is a real prospect that Gina will outlive one or both of them), it seems to me that the deceased’s bequest to the defendants, and the defendants’ promises to the deceased can be seen as an assumption of or recognition of mutual obligations by members of the family, and should not be viewed through a crude transactional lens. Accordingly, the significance of the deceased’s wishes and intentions, as expressed in the will, should not be ignored simply on the basis that the (contingent) gift to the defendants in the will could be characterised as a reward for services to be provided by the defendants.
Turning now to the discretionary considerations in s 91A(2) of the Act, I make the following observations:
(a) the family relationship between Gina and the deceased: Gina was the only child of the deceased;
(b) the obligations or the responsibilities of the deceased towards Gina and the defendants: the deceased clearly had obligations to Gina, and she had no particular obligations to the defendants, unless it could be said that the defendants’ promises to the deceased with respect to their ongoing care of and support for Gina created some obligation towards them on the part of the deceased, which seems to me to be a doubtful contention;
(c) the size of the estate: the estate is a very small estate in contemporary terms;
(d) the financial resources of Gina and the defendants: Gina has a modest income, derived from her Centrelink benefits and the net rental of the apartment, and some assets, being the settlement funds. She also receives significant support from the NDIS, albeit not in cash. There is no sworn evidence from the defendants about the financial circumstances of the defendants. However, I can infer from their addresses (Vicki lives in Richmond, and Jenni in Deer Park) and the limited evidence regarding their personal circumstances (Vicki is a single parent and Jenni does not work outside the home) that they are not wealthy people;
(e) the physical, mental and intellectual disability of Gina or any of the beneficiaries: Gina has an intellectual disability and a severe mental illness. There is no evidence of any disability of either of the defendants;
(f) Gina’s age: Gina is 34, and there is no reason to believe that her disabilities will adversely affect her life expectancy, such that she could live for another fifty years or so;
(g) any contribution (not for adequate consideration) by Gina to building up the estate or the welfare of the deceased or her family: this is not a relevant consideration, given Gina’s disabilities;
(h) any benefits previously given by the deceased to Gina or either of the defendants: not known, but this matter is not particularly relevant to the current application;
(i) whether Gina was being maintained by the deceased in whole or in part prior to her death: the evidence does not disclose whether the deceased financially supported Gina prior to her death, but Vicki gave evidence that the deceased assisted Gina with cleaning and other domestic tasks;
(j) the liability of any other person to maintain Gina: apart from the government, no other person has any obligation to maintain Gina;
(k) the character and conduct of Gina or any other person: Gina’s character and conduct is not relevant, given her disabilities, but the defendants appear to have, subject to their own family responsibilities and the limitations imposed by the COVID-19 pandemic restrictions in 2020 and 2021, fulfilled their promise to the deceased to take care of Gina and remain involved in her life. One could query whether it was appropriate for them to use the income of the estate to, in effect, reimburse themselves for their outings with Gina and the hospitality they provided Gina, but that issue has now been addressed by the payment of the net rental income from the apartment directly to Gina’s bank account;
(l) the effects a family provision order would have on the amounts received from the estate by the defendants: if Gina was to be awarded an absolute interest in the whole of the estate, then the defendants will receive no benefit from the estate; and
(m) any other matter the Court considers relevant: in my view, these matters include:
(i) the commitment made by the defendants to the deceased with respect to Gina, and their fulfilment of that commitment;
(ii) the support provided to Gina by the NDIS;
(iii) the existence and the size of the settlement fund; and
(iv) the question of Gina’s housing security, and the issue of whether awarding Gina an absolute interest in the entirety of the estate would make any material practical difference to Gina’s housing circumstances.
Decision
The application for an extension of time to bring the proceeding was not formally opposed by the defendants. However, the onus lays upon the litigation guardian to persuade me that it is appropriate to grant an extension of time. In Maher v Maher,[14] the Court of Appeal referred to the following matters as being potentially relevant to an application for an extension of time:
… the length of the delay, the reasons for the delay, whether prejudice to other interested parties would result from making an order (other than the prejudice inherent in disturbing the terms of a distribution which would have been in their favour), and the strength of the case. Other considerations may also be relevant, depending on the nature of the case.[15]
[14][2019] VSCA 161.
[15]Ibid [64].
The delay in bringing the current application is 13 months, which is more than trivial, but the delay is not inordinate or inexcusable. As submitted by the litigation guardian, Gina is completely unaware of her rights, and is in no position to provide any explanation for the delay. Further, I agree that, given that the estate remains intact, and the defendants’ interest in the estate does not crystallise until after Gina’s death, there is no prejudice to the defendants in granting an extension of time. Finally, as the only child of the deceased, with a disability, Gina has a legitimate claim to the assets of the estate. Leave to extend time should be granted.
Turning now to the substantive application in this proceeding, subject to my finding that the term of the will which prohibits the sale of the apartment is unduly restrictive, and should be varied or modified as a consequence of this proceeding, I am not satisfied that the failure of the deceased to provide Gina with an absolute interest in the apartment was a failure on her part to make adequate provision for the proper maintenance and support of Gina. I make that finding notwithstanding Gina’s disabilities, her modest financial position, the modest size of the estate, and the absence of any compelling needs on the part of the beneficiaries, or any of them.
I accept the defendants’ submissions to the effect that Gina’s needs are currently being adequately met by her income from Centrelink and the apartment,[16] her secure housing via DFFH, her substantial support package through the NDIS, and the informal support and assistance provided by Vicki and Jenni. Added to that, she has the ability access the settlement fund with the approval of the Senior Master, which could be utilised for purchases of consumer durables, for holidays and to meet any unforeseen contingency. She is unlikely to ever be required to support a partner and/or children, and her disabilities have limited her social circle, and, no doubt, her ability to travel or otherwise participate fully in community life. Therefore, while her resources are modest, her financial needs are also modest, and there is no evidence that there is any material shortfall between her needs and her resources.
[16]Traditionally, the authorities evidence a reluctance on the part of the courts to take into account a claimant’s eligibility for government benefits when assessing whether to make an order for further provision and the quantum of that provision. (See King v White [1992] 2 VR 417). However, a more pragmatic approach is adopted where the estate is small (see Coller v Coller [1998] VSC 80). Further, while s 91(3) of the Act expressly prohibits the court from taking into account any means tested government benefit a claimant may receive or be eligible to receive when assessing whether able bodied adult children were partly or wholly dependent upon the deceased, the limited nature of this prohibition suggests that there is no statutory impediment to taking Gina’s Centrelink benefits into account when assessing her current and future needs.
Further, it is difficult to see how an order for further provision from the estate would make a material difference to Gina’s life. As previously observed, I am not satisfied that the total of the net proceeds of sale and the settlement fund would be sufficient to enable the purchase of a suitable property in a suitable location. Gina has lived her current home for at least 12 years, and it has not been suggested that her current accommodation is unsuitable. And, while theoretically she could be evicted from her current accommodation, it seems unlikely that she would be evicted, and, in her current accommodation, responsibility for maintenance and upkeep rests with DFFH, which I can assume is a significant benefit to someone in Gina’s position, given her lack of organisational skills.
Further, as earlier indicated, even if, contrary to my suspicion to the contrary, it is in fact feasible to purchase a suitable home for Gina in a suitable location, there is no reason why, if the prohibition on the sale of the apartment is removed, the estate could not purchase a suitable property as a co-owner with Gina, with Gina to have a life interest in the estate’s share of the property, if the defendants, the OPA and the Senior Master agreed upon that course of action. However, while such a step might be feasible, it may not be desirable for a range of reasons, at least at this point in time.
Further, it seems to me that this is an application where the views and intentions of the deceased should be given a great deal of weight. The deceased was in regular contact with Gina before her death, and the deceased made her will knowing that she had a serious, and what turned out to be fatal, illness. The deceased would have had as good an idea as anyone of the limitations caused by Gina’s disabilities, and was no doubt keen to protect her from exploitation, and keep Vicki and Jenni involved in Gina’s life. Where there is no evidence about how old the defendants’ children are, I can infer that the deceased knew that the defendants were busy with families of their own, such that the promises they gave her to the effect that they would look after Gina would impose some burden upon them. While the legacy to them in the will should not necessarily be seen exclusively as a reward for services rendered, the fact the legacy could be perceived in that way does not mean that the deceased’s desire to grant such a reward is an irrelevant matter.
Further, while the question of whether the deceased owed a moral duty to make provision for Gina is assessed as at the date of the deceased’s death (and in any event, there is no dispute in that regard), the nature and amount of any further provision is to be assessed as at the time of trial.[17] Since the death of the deceased in 2017, Gina’s circumstances have actually improved considerably. First, she now has access to the settlement fund, which is a significant amount of money. While the settlement fund may be insufficient to purchase a residential property in her current neighbourhood or nearby, it is more than sufficient to fund the purchase of furniture, other consumer durables, and meet any out of pocket medical or other expenses for Gina for many years to come. Secondly, and importantly, she now has access to substantial support services through the NDIS.
[17]See s 91A(2)(d) of the Act.
The support available to Gina through the NDIS is substantial, and, according to Vicki’s evidence, life-changing. The value of the support provided could not be replicated from the assets of the estate, even if the assets of the estate passed to Gina absolutely. In Schmidt v Walter,[18] which involved claims by multiple family members, including two profoundly disabled men, against an estate which was not sufficient to meet all of the claims, I held that the entitlement of the disabled claimants could safely be postponed in favour of the widow of the deceased, at least in part owing to the value and nature of the services provided to them through the NDIS. While I said that my decision should not be viewed as authority for the proposition that the availability of services through the NDIS absolved a testator of the moral duty to make adequate provision for the proper maintenance and support of a disabled family member, I noted that ‘the advent of the NDIS does represent a substantial shift in the landscape against which claims for provision by disabled people, particularly severely disabled people, must be assessed’.[19]
[18][2019] VSC 385.
[19]Ibid [135].
In Schmidt v Walter,[20] I also noted (in reasons published in June 2019) that while the NDIS was a relatively new program, it enjoyed bipartisan political support, and any changes to the program were unlikely to have a significant adverse effect upon the claimants in that proceeding, given the profound nature of their disabilities. Since that time, there have emerged in the public debate some concerns about the long term financial viability of the NDIS, given the escalating costs of the scheme,[21] and a report to the Commonwealth Government following a review of the NDIS is due to be delivered in October 2023. However, given the profound nature of Gina’s disabilities and their permanency, I consider that it is safe to assume that Gina will continue to receive intensive support via the NDIS, noting that part of the responsibilities of the OPA is to advocate on Gina’s behalf with NDIS managers and service providers, so that any deficiencies in service provision will be detected and hopefully remedied. I would be less confident of making such an assumption in circumstances where a claimant’s disabilities were less profound, as any changes to the NDIS in response to budgetary concerns may involve tightening eligibility thresholds.[22]
[20]Ibid.
[21]Michael Read, ‘Budget Watchers urge Albanese to rein in NDIS’, Australian Financial Review (online, 26 October 2022).
[22]See the discussion in Iacono v Iacono [2021] VSC 444 [111], in the context of a claim by an NDIS recipient with less severe disabilities against a substantial estate.
In conclusion, the question of whether the deceased made adequate provision for Gina’s proper maintenance and support, and if not, what would amount to proper maintenance and support, must be assessed in the context of Gina’s actual needs, and the resources available to meet those needs. Only then should the Court take steps to, in effect, undermine or negate the decision of the deceased, which in this case, the evidence indicates, was arrived at carefully and conscientiously. I am not satisfied that making an order that Gina receive the entirety of the estate absolutely would make such a material difference to Gina’s life such as to warrant setting aside the arrangements put in place by the deceased to further what she believed to be the best interests of Gina going forward.
Accordingly, I will grant an extension of time to bring this proceeding, and will make an order in the nature of a Crisp order to provide for Gina to have a portable life interest in the apartment. However, I will not disturb the gift of the remainder interest in the estate to the defendants.
I shall hear further from the parties regarding the appropriate form of order and as to how the deal with the question of costs.
SCHEDULE OF PARTIES
| S ECI 2019 05415 | |
| BETWEEN: | |
| KA YAN TAM (BY HER LITIGATION GUARDIAN, ANDREW JOHN SIMPSON) | Plaintiff |
| - v - | |
| YU CHEN (AS EXECUTOR AND TRUSTEE OF THE WILL AND ESTATE OF LAI HUNG YAM (IN THE WILL CALLED YAM DE SOUZA ESQUIVEL LAI HUNG ALSO KNOWN AS LAI HUNG YAM DE SOUZA ESQUIVEL AND YAM DE SOUZA ESQUIVEL, DECEASED)) | First Defendant |
| RENJING JIANG (AS EXECUTOR AND TRUSTEE OF THE WILL AND ESTATE OF LAI HUNG YAM (IN THE WILL CALLED YAM DE SOUZA ESQUIVEL LAI HUNG ALSO KNOWN AS LAI HUNG YAM DE SOUZA ESQUIVEL AND YAM DE SOUZA ESQUIVEL, DECEASED)) | Second Defendant |
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