Tham v The Public Trustee (WA)
[2016] WASC 170
•14 JUNE 2016
THAM -v- THE PUBLIC TRUSTEE (WA) [2016] WASC 170
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2016] WASC 170 | |
| Case No: | CIV:1912/2014 | 24 - 26 FEBRUARY 2016 | |
| Coram: | MASTER SANDERSON | 14/06/16 | |
| 18 | Judgment Part: | 1 of 1 | |
| Result: | Applications dismissed | ||
| B | |||
| PDF Version |
| Parties: | CHE THAM THE PUBLIC TRUSTEE (WA) (in its capacity as Administrator of the Estate) TIEN DUNG LA TIEN CUONG LA THI NGOC DUNG LA THI NGOC HANH THI NGOC YEN LA TRAN THI TUYET VAN CHE LA THI WILLIAMS CHE THAM NGUYEN |
Catchwords: | Family Provision Act 1972 (WA) claim Claim by widow of deceased and adult children Cost of running the claim Turns on own facts |
Legislation: | Administration Act 1903 (WA) Family Provision Act 1972 (WA), s 12 |
Case References: | Bondelmonte v Blanckensee [1989] WAR 305 Luciano v Rosenblum (1985) 2 NSWLR 65 Nicholls v Zis [2001] WASC 301 Singer v Berghouse (No 2) [1994] HCA 40; (1994) 181 CLR 201 Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
THE PUBLIC TRUSTEE (WA) (in its capacity as Administrator of the Estate)
First Defendant
TIEN DUNG LA
Second Defendant
TIEN CUONG LA
Third Defendant
THI NGOC DUNG LA
Fourth Defendant
THI NGOC HANH
Fifth Defendant
THI NGOC YEN LA
Sixth Defendant
TRAN THI TUYET VAN
Seventh Defendant
CHE LA THI WILLIAMS
Eighth Defendant
CHE THAM NGUYEN
Ninth Defendant
Catchwords:
Family Provision Act 1972 (WA) claim - Claim by widow of deceased and adult children - Cost of running the claim - Turns on own facts
Legislation:
Administration Act 1903 (WA)
Family Provision Act 1972 (WA), s 12
Result:
Applications dismissed
Category: B
Representation:
Counsel:
Plaintiff : Ms W F Gillan & Ms S E Bruce
First Defendant : No appearance
Second Defendant : Mr L A Tsaknis
Third Defendant : Mr L A Tsaknis
Fourth Defendant : Mr L A Tsaknis
Fifth Defendant : Mr L A Tsaknis
Sixth Defendant : Mr L A Tsaknis
Seventh Defendant : Mr L A Tsaknis
Eighth Defendant : Mr D V Blades
Ninth Defendant : Mr D V Blades
Solicitors:
Plaintiff : Jackson McDonald
First Defendant : No appearance
Second Defendant : Bowen Buchbinder Vilensky Solicitors
Third Defendant : Bowen Buchbinder Vilensky Solicitors
Fourth Defendant : Bowen Buchbinder Vilensky Solicitors
Fifth Defendant : Bowen Buchbinder Vilensky Solicitors
Sixth Defendant : Bowen Buchbinder Vilensky Solicitors
Seventh Defendant : Bowen Buchbinder Vilensky Solicitors
Eighth Defendant : Legal Care Australia
Ninth Defendant : Legal Care Australia
Case(s) referred to in judgment(s):
Bondelmonte v Blanckensee [1989] WAR 305
Luciano v Rosenblum (1985) 2 NSWLR 65
Nicholls v Zis [2001] WASC 301
Singer v Berghouse (No 2) [1994] HCA 40; (1994) 181 CLR 201
Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191
1 MASTER SANDERSON: This case raises a number of difficult questions. But the main problem is the estate of the deceased is not large enough to satisfy the legitimate needs of the plaintiff and the defendants. It is a matter of attempting to balance out their respective entitlements. The case is also slightly unusual in that in addition to the claim by the plaintiff for greater provision from the estate of the deceased there is also a claim by the second to fourth and sixth and seventh defendants to a greater provision. (Originally there was also a claim by the fifth defendant but in his closing submissions counsel for the second to seventh defendants conceded no further provision ought be made for her.) There was also originally a claim made by the eighth and ninth defendants. At the commencement of trial they indicated they would not pursue that claim. However they maintained their entitlement should not be altered by any successful claim either by the plaintiff or the other defendants.
2 It is worth noting in passing that the defendants who did make a claim were entitled to do so under the provisions of s 12 of the Family Provision Act 1972 (WA) (the Act). It was not necessary for them to make a separate application. So while it is unusual for defendants to an action to make a claim in their own right they are entitled to do so by the provisions of the Act.
3 The deceased died intestate. It was agreed between the parties that the value of the estate at the date of death was $1,354,943. It is possible to be as precise as that because virtually the entire estate of the deceased was in cash. Based upon the provisions of the Administration Act 1903 (WA) the plaintiff's entitlement as a wife of the deceased as at the date of death was $484,981. The second to the ninth defendants are the children of the deceased. As at the date of death they would have been entitled to $108,745.25 each.
4 Prior to trial certain interim distributions were made from the estate to the plaintiff, the second, third, fourth and seventh defendants. These distributions totalled $240,000. The grossed up value of the estate at the date of trial was agreed at $1,447,256.55. If the estate had been distributed as at the first day of trial the plaintiff would have received $520,163 and each of the defendants would have received $115,886. In percentage terms the plaintiff would have received approximately 36% of the estate and each of the defendants 8%. All parties agreed that consistent with the terms of the Act the amounts distributed prior to trial had to be added back to reach the distribution figures.
5 The parties were largely agreed as to the principles to be applied in an application such as this. The question is whether the will made adequate provision for the proper maintenance, support, education or advancement in life of an applicant: s 6 of the Act. Answering that question is a two stage process. This was explained by Malcolm CJ in Bondelmonte v Blanckensee [1989] WAR 305. That approach was endorsed by the High Court in Singer v Berghouse (No 2) [1994] HCA 40;(1994) 181 CLR 201. It is often said that the first state of the process is a question of fact - that is, whether as at the date of the death of the deceased adequate provision was made for the proper maintenance, support, education or advancement in life of an applicant. If the answer to that question is in the negative them a multifaceted evaluative judgment is required - that is to say, an exercise in discretion - and that is to be undertaken as at the date of trial.
6 Beyond stating these broad principles there is only one aspect of the submissions on the law which requires further attention. That has to do with applications by widows. Counsel for the plaintiff relied upon the decision of Powell J in Luciano v Rosenblum (1985) 2 NSWLR 65 where his Honour said:
It seems to me that, as a broad general rule, and in the absence of special circumstances, the duty of a testator to his widow is, to the extent to which his assets permit him to do so, to ensure that she is secure in her home, to ensure that she has an income sufficient to permit her to live in the style to which she is accustomed, and to provide her with a fund to enable her to meet any unforeseen contingencies (69 - 70).
7 Of course there is nothing in the Act itself which confers a privileged position upon a spouse of the deceased. But there is now a considerable number of cases which adopt that position. In Nicholls v Zis [2001] WASC 301, Pullen J explained both the judicial approach to the Act and the position of a spouse in clear terms. His Honour said [12], [14]:
To achieve what is seen to be the legislative intention and to bring some certainty into an application of the Inheritance (Family and Dependants Provisions) Act 1972, the courts have developed principles and standards which have been applied in determining applications under the legislation. One such principle or standard is the provision a just and wise testator would have thought it his or her moral duty to make in the interests of the claimant had he or she been fully aware of all the relevant circumstances. Permanent Trustee Co Ltd v Fraser (1995) 36 NSWLR 24 per Sheller JA at 46.
...
In the absence of special circumstances, it will normally be the duty of a testator to ensure that a spouse is provided with a place to live, appropriate to that which he or she has become accustomed to. To the extent that the assets available to the deceased will permit such a course, it is normally appropriate that the spouse should be provided as well with a fund to meet unforeseen contingencies. Golosky v Golosky, unreported; NSW Court of Appeal; 5 October 1993 per Kirby J, Luciano v Rosenblum (1985) 2 NSWLR 65. This is not an inflexible rule. It is simply a matter for consideration. See Golosky v Golosky(supra), per Kirby J.
8 The relationship between the plaintiff and the deceased spanned some 30 years. Both were born in Vietnam. Both had been married and divorced before they became acquainted. They commenced living together in 1980. In 1982 the plaintiff and the deceased left Vietnam as refugees. By that time the deceased had five children by his former wife. They are respectively the second through to sixth defendants in this action. He also had another child who is the seventh defendant. The plaintiff had four children with her former husband. Two of those children went to live with their father. The other two children remained with the plaintiff and were aged 12 and 8 when the deceased and the plaintiff started living together in 1980.
9 The plaintiff and her husband spent two years in a refugee camp in Thailand. They married in the camp on 20 October 1982. The eighth defendant was born in the camp in 1983. In 1984 the deceased, the plaintiff and the three children travelled to and settled in Australia. When they arrived in Australia they stayed in a refugee camp for approximately three months. Thereafter they lived in rented accommodation in Perth. The plaintiff worked for a time as a machinist and then when the deceased started his own sewing/tailoring business she worked in that business as well. The ninth defendant was born on 24 October 1985.
10 On 4 May 1988 the deceased and the plaintiff bought a house at 54 Princess Road, Balga. They moved in with their two children and the plaintiff's two daughters from her first marriage. In the early 1990s the deceased sponsored two of his daughters from his first marriage, the fifth and sixth defendants, to come to Australia from Vietnam. The plaintiff says this caused a rift with her husband and the parties separated. After the separation the plaintiff transferred her interest in 54 Princess Road to the deceased. The deceased gave her $30,000 to buy a house with the intention the eighth and ninth defendants would reside with the plaintiff. There was no formal property settlement entered into.
11 In December 1992 the plaintiff bought a house at 180 Princess Road, Balga. She moved in with the eighth and ninth defendants and one of her daughters from the previous marriage. The deceased and the plaintiff were officially divorced on 16 February 1993.
12 In 1994 the deceased sold 54 Princess Road. His two daughters who had been living with him moved to Sydney to live with their aunt. From around 1993 to mid-1995 the deceased rented a property in Osborne Park. He travelled frequently to Vietnam during that period. In 1995 the plaintiff and the deceased reconciled. The deceased moved into 180 Princess Road and the property was transferred to the joint names of the plaintiff and the deceased.
13 In December 2002 the deceased was diagnosed with HIV. This prompted the deceased and the plaintiff to consider their position and they planned to move to Darwin. The property at 180 Princess Road, Balga was sold in May 2003 to facilitate the move. An amount of $162,000 of the sale proceeds was applied to the purchase of 92 Vaucluse Crescent, Ellenbrook. That property was purchased in the name of the eighth defendant. The plaintiff and the deceased travelled to Vietnam for several months in mid-2003 largely because the deceased wanted to 'sort out things in Vietnam'. The couple returned to Perth in approximately October 2003 ahead of their planned relocation to Darwin.
14 On 18 November 2003 the plaintiff and the deceased were involved in a very serious traffic accident. The deceased suffered multiple injuries which left him in need of supervision and/or physical assistance with all self-cares. The deceased was in Royal Perth Hospital for approximately three months after the accident and he then spent approximately two months in rehabilitation at Shenton Park. The plaintiff spent two months in hospital as a consequence of damage to her lower leg. It took her some time to recover from her injuries. The cash in the deceased's estate was largely the damages he received consequent upon this accident.
15 After the traffic accident and upon their discharge from hospital the deceased, the plaintiff and the eighth and ninth defendants lived at the Ellenbrook property. The deceased, the plaintiff and the ninth defendant did not pay any rent for their occupation of the premises.
16 In around September 2004 the deceased and the plaintiff moved with the eighth and ninth defendants to a rental property in Alexander Heights. The plaintiff says this move was made because it was closer to medical facilities were her husband required frequent attention and also closer to her daughter who assisted her to care for her husband. Furthermore, the house was bigger than the one in Ellenbrook and that made it easier for the deceased to manoeuvre his wheelchair.
17 On 7 November 2004 the deceased and the plaintiff married again and from December 2004 to March 2005 they holidayed together in Vietnam.
18 When the plaintiff and her husband returned to Perth in March 2005 they resided again with the eighth defendant who by that stage had bought a house at 18 Jefferson Drive, Marangaroo. The plaintiff continued to care for her husband at home with the assistance of her daughter. In June 2005 the plaintiff had surgery to her leg. Her daughter was also unwell and as a consequence the deceased moved into temporary nursing home care for approximately nine weeks. While he was in temporary care he fell and fractured his hip. Thereafter he was not able to stand or walk. He became more fragile and was mostly bedridden. The plaintiff found she could not care for him. In March 2006 the deceased was placed into permanent care at a nursing home in Marangaroo. In 2008 he moved to Regents Garden in Joondalup. His deterioration was slow but steady and he died on 10 April 2012.
19 Appearing at attachment CT4 to an affidavit of the plaintiff sworn 18 June 2014 is a statement of the plaintiff's financial position as at the date of death of the deceased. It shows she had assets being cash in the bank of $500. She had a liability being a personal loan in an amount of $22,000. Her sole income was an aged pension in an amount of $21,502 per annum. That equates with $413.50 per week. Her expenses are listed and are put at $399.38 per week. It must be said the plaintiff was extremely frugal. For instance, she estimated her weekly expenditure on clothing and shoes at $10. She showed weekly entertainment expenses of $12.50. Having seen the plaintiff give evidence and having read the affidavit material I have no doubt the information provided in that schedule is accurate. In assessing the plaintiff's claim I have adopted the figures she proposed.
20 Now it is time to deal with the position of each of the defendants. The second defendant has always lived in Vietnam. He does not speak, read or write English. The second defendant had a limited education due he says to lack of funds. As the oldest child it was his responsibility to go to work to support the family which he did, living at home and giving the money he earned to his mother to buy food for the family. He has no trade skills. At the date of death of the deceased he was married with three children - two sons aged 20 and 18 and a daughter aged 11. His wife was aged 40 at the date of death of the deceased. She was educated to year 4 level in Vietnam and does not have any trade skills. As at the date of death of the deceased the three children were totally financially dependent on the second defendant. The second defendant and his wife financially support the second defendant's mother-in-law who is frail and requires regular care and assistance.
21 The second defendant and his family live in a very modest home in a province in rural Vietnam. The home is partitioned into 11 rooms of about 10 sqm each. The family uses two rooms in the house. The remaining nine rooms are rented on a casual basis to provide income for the family. The home has running water and electricity but there is no gas. It has a gas tank for cooking. The home has a single kitchen which the family and the borders share. It does not have a separate laundry, eating room or sitting room. Photos annexed to the second defendant's affidavit show his description of the house as 'small and cramped' is indeed accurate. The second defendant attends to all the cleaning services of the rooms.
22 At the date of death of the deceased the second defendant's income was derived solely from the income from the rental of the rooms in the house, income earned as an informal business intermediary and money sent to him by his mother, the deceased's first wife who lives in Australia. She sends him part of the proceeds of her Australian pension. The second defendant says as at the date of death of the deceased his income was not sufficient to allow him to pay his debts. As a result he was not able to pay for house maintenance which has been neglected for years. Subsequent to his father's death the second defendant borrowed the Vietnamese equivalent of $25,000 to pay for maintenance to the house, to pay off his debts and to have some money for emergencies. As at the date of death of the deceased the second defendant and his wife had joint assets (comprising the family home and a motor cycle) of approximately $15,300. They had liabilities of $1,500. He and his wife had a monthly income of approximately $700 and monthly expenses of $756. They have no savings or superannuation. They do not have any health insurance and any personal belongings with any saleable value.
23 The second defendant maintained a good relationship with the deceased. The deceased sponsored the second defendant's visa and paid all his expenses when he travelled to Australia in 1993 and the deceased visited him every year from 1993 until the deceased's motor vehicle accident in 2003. On each of these visits the deceased stayed with the second defendant. During the visit the deceased would give to the second defendant cash payments of between $100 and $200. He also gave the second defendant $200 every six months to use for his children's education. In 1999 the deceased gave the second defendant $1,000 to pay for repairs to the second defendant's home.
24 The evidence detailed a similar story for the third, fourth and seventh defendants. Each of their stories was a slight variation of the second defendant's story. At par 114 of his closing submissions counsel for the second to seventh defendants set out what he referred to as the 'common features of Vietnamese defendants'. In my view this is a fair summary of the respective position of each of those defendants. I will quote it in full:
The (unchallenged) claims of the second, third, fourth, and seventh defendants have a number of common features that pertained both as at the date of death and now being:
(a) they and their families are poor in a poor country;
(b) they have no real means of helping themselves in any meaningful sense in a country that offers no help;
(c) the deceased was their father, who left Vietnam to, and told his children to provide a better future for them because life was very difficult and there was no hope in Vietnam;
(d) during his lifetime, the deceased did the best he could to provide assistance to his children, given his limited means up to his motor vehicle accident in November 2003 which left him incapable of looking after his own affairs;
(e) their income is low and they live from day to day and are unable to satisfy their basic needs;
(f) they do not have any superannuation or savings;
(g) they do not have any saleable assets (the second, third and fourth defendants own modest homes (in the case of the fourth defendant subject to a mortgage) and in the case of the second and third defendants rental received from renting part of their homes did and continues to provide a substantial proportion of their income);
(h) they have limited education. None have a tertiary education or a trade qualification.
(i) each of their spouses similarly has a limited education. None have a tertiary education or a trade qualification.
(j) they each of have very limited future employment prospects (as have their spouses);
(k) their financial prospects are poor, if not bleak (in the case of the second, third and fourth defendants it is difficult to see how they can provide even the most basic items once the $200 monthly gift from their mother in Australia stops, as it inevitably must);
(l) each has dependant children (the second defendant also supports her mother in law [sic] and the fourth defendant also support her sister and law [sic] and the sister and laws [sic] young son);
(m) each has children who wish to undertake tertiary studies (the second, third and fourth defendants expressly state that they cannot pay for the further studies and whilst the seventh defendant does not state this, it is plain from his financial position that the family cannot do so).
(n) save for the fourth defendant who has some public health insurance, they do not have any health insurance;
(o) there is no free health scheme, no free tertiary education, unemployment scheme, pension scheme or aged care facilities available to them when they are unemployed, sick, too sick or too old to work;
(p) each has no realistic means of saving;
(q) each has no realistic prospect of saving for when they are too sick to work or too old to work or to pay for significant medical care for themselves or their children and there is no social security system to fall back on;
(r) each had a good relationship with the deceased [114].
25 Any claim by the fifth defendant was not pressed. That leaves the sixth defendant. She was 39 years of age at the date of death of the deceased. She lived with her family in Vietnam until she came to Australia in 1992. She does not have any trade skills or qualifications and has limited education having left school in Vietnam at the age 14. She speaks only basic English.
26 The sixth defendant is a single mother with three dependent children. At the date of death of the deceased her eldest daughter was 13 years of age, her son was 11 and her youngest daughter aged 5. The sixth defendant is a devout Catholic and she would very much like to send her children to a Catholic school. Limited funds means the children were as at the date of death of the deceased and are still presently being educated at a government school.
27 In June 1991 the deceased sponsored the sixth defendant to emigrate to Australia to live with him. When she emigrated the sixth defendant relied entirely upon the deceased for her financial support. This continued for approximately two years. The deceased paid for all her living expenses and gave her $50 per week to spend. This financial support continued even after she was married with the deceased making intermittent gifts of $100.
28 It is clear the sixth defendant enjoyed a close relationship with her father. In 2003 her father purchased the Ellenbrook property, five minutes driving distance from her house in Henley Brook. After the deceased's accident in 2003 the deceased often stayed at the sixth defendant's house.
29 The sixth defendant had a monthly income of approximately $4,000. The principle source of that income was a carer's allowance, child benefits and a single mother's pension totalling $3,400 per month. Her former husband provides her with child support of $320 per month. Her mother contributes $300 a month from her Australian government aged pension. The sixth defendant spends all of the money she receives on necessities. She budgets very carefully and she struggles from week to week. She has net assets of $153,884. Her main asset is her home which is subject to a substantial mortgage. Her chances of future employment are bleak.
30 Turning then to the eighth defendant. Some considerable attention was directed during the course of the trial at property dealings between the deceased, the plaintiff and the eighth defendant. As the evidence fell the position can be summarised in this way. In 2003 the deceased and the plaintiff gifted the eighth defendant $162,000 from the sale of the property at 180 Princess Road, Balga. That property had sold for $173,000. The eighth defendant then borrowed $20,000 and purchased 92 Vaucluse Crescent, Ellenbrook for a purchase price of $182,500. In January 2005 she purchased the Marangaroo property for $261,000. She sold the Ellenbrook property in March 2005. She then spent $150,000 on renovations on the Marangaroo property in December 2008 through accessing mortgage funds. At all times the eighth defendant has made all home loan repayments herself.
31 Prior to the commencement of the trial submissions made on behalf of the second to seventh defendants seem to suggest it would be argued the Marangaroo property was held on trust by the eighth defendant either for the plaintiff or the plaintiff and the deceased jointly. As it turned out that submission was not really developed during the course of the trial. But insofar as there may be a lingering suggestion of some form of trust the issue can be disposed of shortly. There is nothing in the evidence which could establish that a trust arose in relation to any property which was purchased with the gifted funds. It may well be thought strange the deceased and the plaintiff were as generous to the eighth defendant as they were but that is a matter for them. Unexplained generosity is not sufficient to generate a trust.
32 As at the date of death of the deceased the eighth defendant earned an annual salary of around $50,000 and with her husband had two properties - the Marangaroo property and a property in Ballajura. Both are subject to mortgages. In particular there is a mortgage of $336,778.78 on the Marangaroo property (that figure being the amount of the mortgage as at 30 June 2015).
33 The ninth defendant earns an annual salary of around $55,000 from a restaurant business he is involved in as a quarter share partner. He has recently married and is fully supporting his wife who is a student. He does not own his own home and has limited liabilities relating to a business loan.
34 It was the plaintiff's position the distribution on intestacy did not adequately provide for her proper maintenance and support. In particular counsel pointed to the fact the plaintiff had nowhere to live. She was presently living rent free in the property owned by the eighth defendant and while there was no suggestion she would be evicted the position was uncertain. Further the plaintiff maintained she should have a fund which would generate income to supplement her aged pension. She submitted it was appropriate for her to have a capital sum for contingencies, an amount to allow her to purchase a car and an amount to allow purchase of furniture and household items. These it was submitted were the bare necessities to maintain a spouse. The amount counsel submitted would have been appropriate to adequately provide for the proper maintenance and support of the plaintiff was $953,656 (less the $180,000 already received in interim payments). It was said because that amount was not left to her it was clear she had not been adequately provided for and the jurisdictional question should be answered in her favour.
35 The position of the second to fourth and the sixth and seventh defendants was rather more straightforward. They maintained the amount they would receive on an intestacy did not allow for their proper maintenance, support and advancement in life. They pointed to the fact of their extremely modest means and, at least so far as the defendants resident in Vietnam were concerned, the difficulties of merely living from day to day. In the circumstances they maintained they were entitled to a greater share of the deceased's estate.
36 The position of the defendants resident in Vietnam poses a problem. Each of them lives in circumstances and has an income which bears no relation to the Australian experience. It was submitted on behalf of the plaintiff their situation had to be judged by Vietnamese standards. The defendants on the other hand maintained that their very difficult situation in and of itself demonstrated that they had needs which were not met by the distribution on intestacy.
37 It is convenient to deal first with the jurisdictional question so far as it applies to the defendants. I am not satisfied that the distribution did not adequately provide for the proper maintenance or advancement in life of any of the defendants. So far as the defendants residing in Vietnam are concerned distribution according to law will increase each of their net worth by five times. That surely operates to their advantage. There are two further points which mitigate against any claim. First, the undoubted entitlement of the plaintiff to provision from the estate. If the distribution to the defendants was increased it would have to be at the expense of the plaintiff. For reasons which I will explain below that does not seem to me to be a reasonable proposition.
38 Second, there is the fact that each of the defendants is an adult child of the deceased. There has been much discussion in many of the cases about the entitlement of an adult child to claim from a deceased parent. Vigolo v Bostin [2005] HCA 11;(2005) 221 CLR 191 was in part concerned with that issue. Although the children of the deceased benefited from his largesse from time to time they were not being maintained by him and it is difficult to see he had any particular moral obligation to provide for them on his death.
39 In all the circumstances then I am not satisfied that any of defendants have satisfied the jurisdictional question and I would dismiss their claims.
40 Turning then to the plaintiff the question really comes down to this. Is it necessary for the plaintiff's proper maintenance that she be provided for to the extent of allowing her to buy a house? I frame the question in that way for this reason. As I indicated above the plaintiff submitted that to be adequately provided for she needed to have available $500,000 to allow her to buy from the eighth defendant the Marangaroo property where she currently resides. If that amount is removed from the total amount of $953,656 which the plaintiff says she should receive from the estate, distribution according to law will adequately provide for her.
41 In support of her application the plaintiff relied on the evidence of Dennis Edward Barton, an actuary and principle of Barton Consultancy Pty Ltd. Mr Barton prepared a report dated 12 March 2015. Essentially what Mr Barton was doing was looking at the amount of money the plaintiff would need to have to generate enough income to supplement her pension so that she could enjoy a comfortable, if modest, standard of living. Mr Barton assumed the plaintiff's remaining life expectancy was 23.8 years. He then made a series of assumptions to allow the necessary calculation to be made. By way of example in relation to indexation Mr Barton says:
10. Generally, I have assumed indexation at either Consumer Price Index (CPI) or Average Weekly Ordinary Times Earnings (AWOTE). My assumption for CPI growth is 2.5% per annum, being the centre of the Reserve Bank of Australia's target band. I have assumed AWOTE will be 1% per annum faster.
11. There is little legislative specification of indexation of tax and Social Security payments and parameters. Social Security legislation currently mandates pension increases at the greater of CPI and AWOTE (which is likely to be AWOTE and is so assumed). Most tax and Social Security parameters have been subject to informal indexation.
12. Against this background, I have assumed that the desired income should increase in line with CPI. This should preserve her absolute, but not relative, standard of living. In other aspects, I have assumed CPI indexation unless AWOTE is mandated.
42 Mr Barton's calculations assume a 'base desired income of $35,773 per annum'. Mr Barton identifies that as being 52.18 times the plaintiff's identified weekly needs. There are some other assumptions which are made which seem on the face of it to be questionable. For instance, a gross investment earning rate of 7% per annum is anticipated. But in cross-examination Mr Barton was not pressed on this or any other issue. So his evidence can be accepted. Appearing as an attachment to Mr Barton's report is a schedule of weekly expenses which was prepared by the plaintiff's solicitors. It shows a total weekly expenditure of $685.57. They are the figures that Mr Barton has used. It is worthy of note that they do not include any accommodation costs. In other words Mr Barton's figures have been produced on the assumption the plaintiff will own her own home and not be paying any rent.
43 If it be accepted, as the plaintiff submitted, a fund of $245,900 is required to generate an income sufficient to allow the plaintiff to live comfortably (and assuming social security payments will continue unaffected) then it is a question of what further amount she requires for her proper maintenance. In the schedule of the plaintiff's needs a number of different amounts are listed. There is an amount of $28,000 to repay loans, $20,000 for a motor vehicle and $20,000 for replacement furniture. There is also an amount of $20,000 for the wedding of the plaintiff and the deceased's son. If all of these matters are taken into account and $100,000 is allowed for contingencies the amount the plaintiff needs is still well short of what she would receive on an intestacy.
44 The plaintiff led evidence of a valuer, Mr Bernard Henricus Lamers, who was tasked with assessing what it would cost to buy a house the plaintiff regarded as suitable. The letter of instruction to Mr Lamers is found as annexure BHL-1 to his affidavit sworn 26 May 2015. Mr Lamers was asked to assume the plaintiff wished to live in Marangaroo and that the property would have three characteristics. First, it was a free standing house with a minimum of three bedrooms. Second, the dwelling was to be in reasonable condition not requiring any significant repair or renovation in the short to medium term. Finally, the dwelling was to have good access to public transport, shops and other amenities such as medical facilities.
45 Mr Lamers in keeping with valuation principles examined a number of properties in the Marangaroo area which were for sale. He concluded:
It can be seen from the properties investigated that the value range for these types of properties that best meet the criteria are in the vicinity of between $420,000 up to approximately $480,000. As properties become larger featuring four bedrooms and two bathrooms of a similar quality and location, then prices start to exceed $500,000. As the instructions indicate, there was no requirement for second bathrooms therefore we have excluded these from the properties investigated. (original emphasis)
46 It is clear that if the plaintiff is to have a residential property of her own she will have to pay in the region of $450,000 for that property and the amount provided for her is not enough. On the other hand were she content to rent premises the amount she receives according to law would in all probability be sufficient. The amount she would receive from an investment over and above her weekly requirements would allow for rent to be paid. It must be acknowledged of course there was no evidence led by either party as to how much rent that might be or the availability of rental properties in the Marangaroo area.
47 On balance I am not satisfied the plaintiff has established her entitlement on intestacy was not such as to not provide adequately for her proper maintenance and support. True it is that were further provision to be made she could buy a house. But she and her husband were content for many years to rent a property or live with their children. Subsequent to the car accident the plaintiff and the deceased could have, if they had wished to do so, purchased a property in their own right. They chose not to do so. That was their right. But it is not now clear that the proper maintenance and support of the plaintiff requires she purchase a home which will significantly deplete the estate.
48 That leads on to a further consideration which looms large in this case. There are competing claims. The claims of the defendants cannot be ignored particularly the Vietnamese defendants who are in strained circumstances. As always in these matters it is a balancing exercise but taking into account the size of the estate, the needs of the plaintiff, the competing claims on the deceased and all other relevant matters I am not satisfied the plaintiff has satisfied the jurisdictional question. Her application should therefore be dismissed.
49 As I have indicated the question of whether or not adequate provision has been made for the parties is a question to be determined as at the date of death of the deceased. However, it must be recognised that costs will have to be paid by the parties. This is not a case where any of the parties - the plaintiff and the defendants - have any assets independent of what they will receive from the estate which would allow them to meet their solicitors' costs. That being the case at the conclusion of the hearing I asked each of the solicitors involved to provide details of the costs associated with the action. The plaintiff's solicitors put their client's costs at just over $130,000. The costs of the Public Trustee were just under $7,000. The solicitors for the second to seventh defendants estimated their costs at $212,000. The eighth and ninth defendants' solicitors put their costs at just over $21,000. In addition there are the costs of administering the estate and a tax liability as yet unquantified. It is reasonable to assume these fees will come in at somewhere around $30,000. That means the amount actually available for distribution will be depleted by perhaps $400,000.
50 As counsel for the plaintiff pointed out during the hearing these reasons are not the occasion to determine how the costs of the parties should fall. After all there may have been a Calderbank offer or some other fact which would affect a costs order. But the mere fact costs in the region of $400,000 were incurred demonstrates the need for care to be exercised in taking matters such as this to trial. That is not to say this was one of those cases which was overworked. Experienced counsel in the course of the trial hardly wasted a word; some of the affidavit material was extraneous but not much. In all it was a very well run case. It is perhaps a salutary lesson as to the costs and consequences of not settling actions of this nature.
51 The plaintiff's action will be dismissed as will the defendants' applications. I will hear the parties as to costs.
1
5
2