Court of Appeal
Supreme Court
New South Wales
Medium Neutral Citation: Wardy v NSW Trustee and Guardian [2021] NSWCA 121 Hearing dates: 1 March 2021; 2 March 2021 Date of orders: 4 June 2021 Decision date: 04 June 2021 Before: Macfarlan JA at [1];
Meagher JA at [72];
White JA at [73]Decision: (1) Appeal dismissed with costs.
(2) The appellant’s notice of motion filed on 2 February 2021 dismissed with costs.
(3) Leave granted to the respondent to file a notice of cross-appeal in the form provided to the Court.
(4) Direct the respondent to file and serve its notice of cross-appeal within 14 days of the date of this judgment.
(5) Allow the cross-appeal.
(6) Pursuant to the cross-appeal, set aside Declaration (5) made by Slattery J on 29 January 2020.
(7) Order the respondent to pay the appellant’s costs of the supplementary submissions filed in this Court.
(8) Otherwise make no order as to costs of the cross-appeal.
Catchwords: SUCCESSION – appropriate substitute for specific devise – property subject of specific devise sold by administrator to pay debt – need to put specific devisees in materially the same position that they would have been in if the sale had not occurred – how rights of beneficiaries should be adjusted –whether substitution of specific property from residuary real estate appropriate – need for equivalence in value
VALUATION – courts and tribunals – appeals – whether judge erred in discounting value of property for contingencies – acceptance of expert evidence required evaluative conclusions to be made – standard of appellate review analogous to that described in House v The King
SUCCESSION – trusts and trustees – judicial advice, Trustee Act 1925 (NSW), s 63 – whether judicial advice given – parties concurred in primary judge himself determining the issue of what adjustment of the rights of the beneficiaries should be made – broad powers of the Court under UCPR r 54.3
Legislation Cited: Succession Act 2006 (NSW)
Supreme Court Act 1970 (NSW), sub-ss 75A(7), (8)
Trustee Act 1925 (NSW), s 63
Uniform Civil Procedure Rules 2005 (NSW), r 54.3
Cases Cited: Akins v National Australia Bank (1994) 34 NSWLR 155
Chaworth v Beech (1799) 4 Ves Jun 555; 31 ER 285
Cherry v Boultbee (1839) 4 My & Cr 442; 41 ER 171
Ewer v Corbett (1723) 2 P Wms 148; 24 ER 676
Federal Commissioner of Taxation v St Helens Farm (ACT) Pty Ltd (1981) 146 CLR 336; [1981] HCA 4
House v The King (1936) 55 CLR 499; [1936] HCA 40
Suttor v Gundowda Pty Ltd (1950) 81 CLR 418; [1950] HCA 35
TTY167 v Republic of Nauru [2018] HCA 61; (2018) 93 ALJR 111
Texts Cited: J D Heydon, M J Leeming and P G Turner, Meagher, Gummow & Lehane’s Equity Doctrines and Remedies (5th ed, 2014, LexisNexis Butterworths)
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- Case
- [2021] NSWCA 121
- Decision Date
CaseChat Overview and Summary
The Court was required to determine how the rights of beneficiaries should be adjusted when property subject to a specific devise is sold by an administrator to meet estate debts. Specifically, the Court had to consider whether substituting specific property from the residuary real estate was an appropriate remedy and, if so, whether there needed to be equivalence in value between the original devise and any substitute property. The Court also considered whether the primary judge erred in discounting the value of property for contingencies and the scope of the Court's powers under the *Trustee Act 1925* (NSW) and the Uniform Civil Procedure Rules (UCPR).
The Court of Appeal applied the principle that a specific devisee should be put in materially the same position as they would have been had the sale not occurred. This involved an assessment of the value of the specific devise and the consideration of whether a substitute from the residuary estate was appropriate, requiring equivalence in value. The Court affirmed that the standard of appellate review for valuation issues was analogous to that in *House v The King*, requiring deference to the primary judge's evaluative conclusions unless an error of principle was demonstrated. The Court also noted the broad powers of the Court under UCPR r 54.3 and the parties' concurrence in the primary judge determining the adjustment of beneficiaries' rights.
The appeal was dismissed with costs. The appellant's notice of motion was also dismissed with costs. Leave was granted to the respondent to file a notice of cross-appeal, and the respondent was directed to file and serve it within 14 days. The cross-appeal was allowed, and Declaration (5) made by Slattery J was set aside. The respondent was ordered to pay the appellant’s costs of supplementary submissions, but otherwise, no order was made as to the costs of the cross-appeal.
Orders
Orders of the court
(1) Appeal dismissed with costs.
(2) The appellant’s notice of motion filed on 2 February 2021 dismissed with costs.
(3) Leave granted to the respondent to file a notice of cross-appeal in the form provided to the Court.
(4) Direct the respondent to file and serve its notice of cross-appeal within 14 days of the date of this judgment.
(5) Allow the cross-appeal.
(6) Pursuant to the cross-appeal, set aside Declaration (5) made by Slattery J on 29 January 2020.
(7) Order the respondent to pay the appellant’s costs of the supplementary submissions filed in this Court.
(8) Otherwise make no order as to costs of the cross-appeal.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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