Waugh-Allcock v Allcock

[2008] NSWSC 634

CITATION:	Waugh-Allcock v Allcock [2008] NSWSC 634
HEARING DATE(S):	29/05/08, 30/05/08, 02/06/08
JUDGMENT DATE :	15 August 2008
JURISDICTION:	Equity Division
JUDGMENT OF:	Macready AsJ at 1
EX TEMPORE JUDGMENT DATE:	15 August 2008
DECISION:	Paragraph 85
CATCHWORDS:	Family Provision application by widow under Family Provision Act. No competing claim. Consideration of disposition by plaintiff during her lifetime to her son. Order made for provision.
PARTIES:	Rosemary Waugh-Allcock v Stephen Allcock
FILE NUMBER(S):	SC 5043/06
COUNSEL:	C Simpson SC for plaintiff M Gorrick for defendant
SOLICITORS:	McNamara James & O'Connor for plaintiff Proctor Willaws for defendant

- 1 -

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

Associate Justice Macready

Friday 15 August 2008

5043/06 Rosemary Waugh-Allcock v Stephen Allcock

JUDGMENT

1 His Honour: This is the hearing of an application under the Family Provision Act 1982 in respect of the estate of the late Edward Hall who died on the 15 November 2005 aged 86. The deceased was survived by the plaintiff, his widow, who is now aged 83 and four adult children from a prior marriage. The plaintiff’s adult son, Rory (Alec) Wall, is the only other eligible person. He has been given notice and makes no claim.

The will of the deceased

2 The deceased made his last will on 4 November 2005 and appointed the defendant, his son, as executor and trustee. In his will the deceased provided for a car to pass to the plaintiff together with various household effects. He gave his property at Short Street, Maclean, to his son the defendant, Stephen, and his interest in the property at Brooksby to his son Stephen and his daughter Alison.

3 The deceased had been a medical practitioner and apart from his country property he had a company Epalana Pty Limited which in his latter years held his investments. He gave his shares in the company to his daughters Alison and Catherine and his sons Stephen and Jonathan. In clause 7 of his will he provided a further benefit for his wife in these terms:

“ I give to my trustee all monies (if any) due to me in my loan account with Epalana Pty Ltd (currently approximately $386,000) UPON TRUST for my wife Rosemary to be paid by my trustees instalments of $12,000 every three months from the date of my death until the funds from the loan account has been fully paid out or my wife Rosemary has died ”

4 He gave the residue of his estate to his four children.

Assets in the estate

5 The deceased's estate at the date of death was sworn in the application for probate at $1,651,642. This did not take account of some $600,000 which the deceased distributed among his four children and the son of the plaintiff some two or three days before his death.

6 From the estate the executor purported to put aside a sum of $410,000 being what was said to be the outstanding amount of the loan account plus interest. It was disclosed in affidavits served the day before the hearing that notwithstanding that these proceedings had been commenced within time that since the commencement the balance of the estate being the real estate and the shares in the investment company had been distributed to the beneficiaries.

7 There have been costs incurred in the matter. The plaintiff's costs to the end of the hearing are estimated at some $105,968.20 and the defendant's costs are estimated at $67,500

Family history

8 Edward Allcock the deceased was born in June 1919 and Rosemary Waugh-Allcock the plaintiff was born in June 1924 at Maclean on the North Coast of New South Wales

9 In 1942 the plaintiff left school and commenced to work for her father who managed a grazing property in the Maclean region. In October 1964 she married Roy Ellis. In February 1966 their son Alec Waugh was born. He is now aged 42.

10 In 1968 the plaintiff’s husband, Roy Ellis died. Roy Ellis left a property at Nymboida to the plaintiff and Roy Ellis’ sister, Marjorie Cutler in equal shares. According to the plaintiff she managed this property without involvement from Ms. Cutler over the next 18 years.

11 In 1973 Alec Waugh attended boarding school returning home during holidays when he lived with the plaintiff and subsequently the plaintiff and the deceased after their marriage. In 1977 the plaintiff met the deceased. They married in November 1978. The plaintiff and deceased thereafter lived on the plaintiff’s property “Taloumbi Station”. The plaintiff also owned land known as Toumbaal Plains, some nearby land known as Elders, a residence at 1 Short Street, Maclean together with the land at Nymboida owned jointly with her late husband’s sister.

12 The deceased had four children from his prior marriage, Alison, Jane (Catherine), Stephen, the defendant, and Jonathan. The deceased worked as a medical practitioner and owned the property “Brooksby” comprising 3,300 acres some of which was heavily timbered.

13 I accept that during the parties’ marriage the plaintiff and the deceased ran some of their cattle together but kept them in separate ownership. For the first ten years of their marriage the plaintiff worked the deceased’s cattle which she did without a wage or a share of the profits being paid to her for those activities.

14 The plaintiff and the deceased mainly conducted separate bank accounts during the marriage. The deceased paid her a monthly wage from his medical practice, paid other expenses and made purchases of foodstuffs.

15 In approximately 1979 the deceased purchased a property named “Main Chance” for $84,000, which was used for cattle breeding and fattening.

16 In 1983 the plaintiff was in financial difficulty as a result of having a son at boarding school so she planned to sell the Short Street house. The plaintiff says the deceased said that he would buy the Short Street property from her “and that way we will keep it in the family” and “if we get sick we can go and live there”. She also said that the deceased said he would leave the property to her son, Alec.

17 On 18 February 1983 the plaintiff transferred the Short Street property to the deceased as to a three quarter share and deceased’s son, Stephen, as to a quarter share as tenants in common and was paid $16,000. The transfer was expressed to be for a consideration of $60,000.

18 In 1984 Alec Waugh finished boarding school and went on to university.

19 In the 1980s the plaintiff and the deceased purchased as joint tenants for approximately $19,000 21 acres known as “Honeysuckle” with funds provided by the deceased. This property enabled the plaintiff’s Taloumbi Station property to have a frontage to the Taloumbi Road. In 1986 Roy Ellis’ sister, Marjorie Cutler, transferred her interest in the Nymboida properties to Alec Waugh.

20 In 1987 Alec Waugh commenced working for Baker & McKenzie as a law clerk initially working full time. In 1988 Alec Waugh and the plaintiff discussed transferring Toumbaal Plains to him and a Contract of Sale was drawn up for the plaintiff to transfer part of Toumbaal Plains being Lot 94 to him but the parties did not proceed with the transfer at this time. Since that time Alec Waugh says he has managed the affairs concerning Toumbaal Plains and treated it as his own.

21 In 1989 or 1990 the plaintiff and the deceased decided that they should commence sugar cane farming on their respective properties. Thereafter she commenced to grow sugar cane on about half the land at Taloumbi and the deceased grew sugar cane on “Main Chance”. Alec managed the sugar cane farming businesses for both parties. The activities at Taloumbi were conducted by the plaintiff in partnership with her son which partnership was styled the “Taloumbi Station Partnership”.

22 The plaintiff says that the wages paid by the Taloumbi Station Partnership included wages for men employed in grazing and sugar cane operations including on the deceased’s properties of Brooksby and Main Chance and the total amount paid for wages was $260,000.

23 Alec Waugh gave evidence that during the first year of Taloumbi Station Partnership significant capital works were undertaken on Taloumbi with borrowings from the ANZ Bank secured over the plaintiff’s property at Toumbaal Plains and the property owned by him and the plaintiff at Nymboida. Alec Waugh was not paid a salary by the Taloumbi Station Partnership or the deceased but the deceased did pay him a management fee at some point during the period of approximately $10,000.

24 Alec Waugh gave evidence that in November 1990 the NSW Department of National Parks & Wildlife wished to acquire some of the plaintiff’s land at Toumbaal Plains for a national park and thereafter he managed the plaintiff’s claim for compensation in respect of that acquisition.

25 In December 1991 part of the plaintiff’s and Alec Waugh’s land at Nymboida was sold for $80,000 and the proceeds applied to liabilities of Taloumbi Station Partnership. At the same time another part of that land was sold for $103,000 with vendor finance. Half the principal was paid on settlement with the remainder being paid in January 1994 and applied to liabilities of Taloumbi Station Partnership. Thereafter two blocks were sold for $32,000 and $35,000 with the proceeds being applied to liabilities of Taloumbi Station Partnership.

26 In January 1993 the land and house at Rocky Creek sold for $170,000 and proceeds applied to liabilities of Taloumbi Station Partnership. In that year the deceased sold “Main Chance” for $380,000.

27 In September 1993 Alec Waugh married and later that year he ceased working full time for Baker & McKenzie. He commenced working a flexible 3 days a week to accommodate his family commitments and completion of his part time study.

28 In November 1993 part of the plaintiff’s land at Toumbaal Plains (Lot 91) was sold for $55,000 and proceeds applied to liabilities of Taloumbi Station Partnership. The next month another part Lot 92 was sold for $55,000 and the proceeds similarly applied.

29 In May 1994 Alec Waugh resigned from Baker & McKenzie and began working three to four days a week for Mallesons Stephen Jacques. In June of that year the National Parks resumed 100 acres of the plaintiff’s land at Toumbaal Plains (aka “Elders”). She then retained two 50-acre blocks.

30 In September 1994 Alec Waugh purchased a unit at Darling Point for $290,000 in the name of the plaintiff and himself with the assistance of a loan from the deceased for the deposit pending receipt of the compensation monies in respect of the resumption of land at Toumbaal Plains (Elders).

31 In November 1994 the plaintiff received the initial compensation of approximately $590,000 gross in respect of resumption of land at Toumbaal Plains having incurred legal fees of approximately $250,000. The balance she applied to complete the purchase of the Darling Point unit.

32 In November 1996 the plaintiff received a further payment in respect of the resumption of $311,000 inclusive of interest and these proceeds were applied to the liabilities of Taloumbi Station Partnership. In 1997 due to the falling prices for sugar cane and losses sustained, sugar cane growing ceased.

33 In early 1999 Alec Waugh discussed with plaintiff and deceased the construction of a house on a hill on Lot 93, Toumbaal Plains. He and his wife subsequently constructed a house at a cost of about $230,000 on Lot 93 with the assistance of a mortgage advance. What they did not know at the time was that the property had not been transferred to them. In November 2000 the plaintiff had by mistake transferred Lot 94 (not Lot 93) to Alec Waugh. This transfer was at no cost to Alec.

34 On 8 April 1999 the deceased executed a Will providing, inter alia, that his interest in the Short Street, Maclean property was to pass to Alec Waugh.

35 In early 2000 the partnership between Alec Waugh and his mother in the Taloumbi Station Partnership ended and he ceased to have any direct financial involvement with the plaintiff and the deceased concerning their agricultural interests. He subsequently became aware that the plaintiff and the deceased had allowed their insurances to lapse across all their properties so he paid for all insurances on an annual basis for all properties. The deceased would reimburse him for the costs associated with Brooksby which was the deceased’s remaining property.

36 In 2001 the deceased spent approximately $120,000 in respect of extensions and renovations to the plaintiff’s homestead at Taloumbi.

37 In June 2002 Alec Waugh and plaintiff sold the Darling Point unit for $535,000. The sale proceeds were invested and paid by Alec and his wife to live on for 12 months while he started a consultancy business. Thereafter he used the balance to purchase a house in Sydney. In July 2002 he resigned from his employment in Sydney and he and his family moved to Toumbaal Plains. In July 2003 Alec Waugh and his family returned to Sydney to reside.

38 In early 2005 Alec Waugh became aware that Lot 94 had been transferred to him and not Lot 93 where he had built his home. He brought this to the attention of the plaintiff and discussed it with her and the deceased. In June 2005 the plaintiff signed a transfer of land for lot 93 Toumbaal Plains to Alec Waugh which was witnessed by the deceased. Shortly thereafter Alec became aware of deceased’s illness and the transfer of the property was not immediately registered.

39 In August 2005 the deceased became too ill to continue medical practise.

40 On 4 October 2005 Alec Waugh spent the day with deceased and discussed his will. The deceased said he and his wife would “soon get a cheque for $100,000” and that he had “provided the same to all the children”.

41 On 5 October 2005 the deceased suffered a stroke and was hospitalised. On 4 November 2005 he executed his last will. On 11 November 2005 he was discharged from Maclean Hospital and he died on 15 November 2005. Shortly afterwards Stephen Allcock arranged delivery of six young heifers in accordance with the deceased’s wish to Taloumbi Station for the plaintiff.

42 Alec Waugh mislaid the June 2005 transfer of Lot 93 so he arranged for another transfer to be signed by the plaintiff on 31 January 2006 which was then registered. He now owns Lot 93 and Lot 94.

43 On 6 June 2006 Probate of the Will of the deceased was granted to defendant.

44 On 11 July 2006 the plaintiff received from Epalana Pty Limited the first quarterly instalment of $12,000 provided for her in the deceased’s will. On 19 October 2006 the plaintiff received a payment of $36,000 by cheque from Epalana Pty Limited. She paid this cheque into her Maclean account from which she repaid her son $34,300 in part repayment of $55,000 he had lent her to that time.

45 On 12 December 2006 the plaintiff received the further sum of $12,000 by cheque from Epalana Pty Limited. On 12 February 2007 the plaintiff received a letter from defendant advising he was suspending payments from the deceased’s estate until “this matter is finalised”.

46 As a result of the suspension of these payments in April 2007 the plaintiff sold her Mercedes motor vehicle for $33,000 and the proceeds were paid into the account maintained by Alec Waugh and his wife to meet the plaintiff’s general living expenses.

47 In the hearing before me the defendant executor offered to continue the payments to the plaintiff in accordance with the will of the deceased.

Eligibility

48 The plaintiff is an eligible person having been his wife for some 27 years.

49 In applications under the Family Provision Act the High Court in Singer v Berghouse (1994) 181 CLR 201 has set out the two stage approach that a Court must take. At page 209 it said the following:-

"The first question is, was the provision (if any) made for the applicant 'inadequate for (his or her) proper maintenance, education and advancement in life'? The difference between 'adequate' and 'proper' and the interrelationship which exists between 'adequate provision' and 'proper maintenance' etc were explained in Bosch v Perpetual Trustee Co Limited . The determination of the first stage in the two-stage process calls for an assessment of whether the provision (if any) made was inadequate or what, in all the circumstances, was the proper level of maintenance etc appropriate for the applicant having regard, amongst other things, to the applicant's financial position, the size and nature of the deceased's estate, the totality of the relationship between the applicant and the deceased, and the relationship between the deceased and other persons who have legitimate claims upon his or her bounty.
The determination of the second stage, should it arise, involves similar considerations. Indeed, in the first stage of the process, the court may need to arrive at an assessment of what is the proper level of maintenance and what is adequate provision, in which event, if it becomes necessary to embark upon the second stage of the process, that assessment will largely determine the order which should be made in favour of the applicant. In saying that, we are mindful that there may be some circumstances in which a court could refuse to make an order notwithstanding that the applicant is found to have been left without adequate provision for proper maintenance. Take, for example, a case like Ellis v Leeder where there were no assets from which an order could reasonably be made and making an order could disturb the testator's arrangements to pay creditors."

The plaintiff’s situation in life

50 The plaintiff is 84 years of age and has no dependents. Her present assets are as follows:

Taloumbi Station and Honeysuckle $1,300,000
Elders 200,000
Stock 76,000
Ford Bronco vehicle 6,150
Four mares 4,000
Eleven Welsh mountain ponies 11,000
Shares 5,393
Cash 3,411
Toyota Landcruiser 22,900
Farm equipment 81,000
Total $ 1,713,854

51 The plaintiff has debts of $16,617.

52 The plaintiff has continued to operate “Taloumbi Station” and the losses she has incurred are as follows:

2000 – 2001 $5,659
2001 – 2002 $9,759
2002 –2003 $16,080
2003 – 2004 $ 8,095
2004 – 2005 $21,578

53 The plaintiff is in good health. She wishes to remain at “Taloumbi Station” and to operate the property as a farm until she dies. She has resided at Taloumbi Station for most of her adult life where she has carried on grazing activities.

54 The plaintiff intends to continue to operate the property and she will have expenses such as the cost of fertiliser, replacing vehicles as they age and other related expenses. The house where she lives contains a number of rooms which cannot be used because of cracks in the walls apparently as a result of movement in the sub-soil. She has always been interested in horses but that has had to be restricted in recent years because of her lack of funds.

55 There is evidence from the plaintiff about her current expenses. Her personal expenses average $1,224.34 a week and the net loss associated with the operation and running of the property is $260.95, a weekly total of $1,485.29. These figures are consistent with the figures after the end of the involvement with sugar cane production. The plaintiff has a life expectancy of approximately 8.5 years. A sum to enable her to maintain this level of expenditure would be $582,382.

56 It was suggested in submissions that the plaintiff being physically active there was a possibility that she would exceed the medium mortality figure and an extra allowance of 20% should be made in this possibility. This would increase the figure to $682,401.63.

57 At present the plaintiff has assistance from neighbours but if that ceased she would need a further $78,420. It was submitted that there should be a provision for increased domestic assistance of three hours in the sum of $24,702. These figures total $785,523.

58 It is necessary to consider the situation in life of anyone else having a claim on the bounty of the deceased. In this case they are the children of the deceased by his first marriage. They have not placed before the court their financial circumstances nor have they detailed their relationship with the deceased. In these circumstances the court can assume that they do not wish the court to take account of such matters when considering the plaintiff’s application.

59 The defendant made a lengthy submission sometime after the completion of the hearing, Paragraphs 2 to 7 of these submissions introduce the first half of the submissions in these terms:

“ The relationships between the plaintiff and the deceased and the plaintiff’s separation of her finances and assets from those of the deceased
2. The marriage between the plaintiff and the deceased was a long one though it produced no children. For each this was their second marriage and for each there were children from their first marriages.
3. A significant and enduring feature of the marriage of the plaintiff and the deceased was the high degree of separation of their financial affairs and circumstances including the degree of separate ownership of assets each brought to the marriage or assets acquired by them after they marked. When the plaintiff needed financial assistance in 1983, she raised the money by selling one of the pieces of land she owned to the deceased (as to ¾ s) and the defendant (as to ¼) for valuable consideration. Such a commercial approach to a spouse’s apparent need for funds is one of a number of unusual features of the financial aspects of the marriage between the plaintiff and the deceased.
4. Another significant feature of the marriage between the plaintiff and the deceased was the extent of the intermingling of the financial affairs of the plaintiff and her son by her first marriage, Roy Waugh (also referred to in evidence as ‘Alec Waugh’), to the exclusion of the deceased and his children.
5. The evidence discloses that the plaintiff and Roy Waugh have had, since at least the early 1980’s, substantial, extensive and ongoing property and financial dealings with each other (and also, to a lesser degree, with Alec’s wife, Kathleen Waugh). Such dealings are far greater in extent, nature and number than any such dealings between the plaintiff and the deceased.
6. The Court should, with respect, look to the reality of the arrangements, including the property arrangements, between the plaintiff and Roy Waugh, in order to fully assess her financial circumstances and in order to properly and fairly assess her stated need for greater provision than the deceased made for her in his last will. In this sense, it is submitted that a consideration of inter-relatedness of the financial circumstances of the plaintiff and Roy Waugh is no less relevant than a consideration of the circumstances of the spouse of a claimant in the context of a Family Provision Act claim.
7. It is submitted that the relationship between the plaintiff and Roy Waugh goes beyond that of loving mother and son to a relationship characterised by mutual reliance and by a shared expense of ownership and entitlement to Waugh family real property assets. The plaintiff and Roy Waugh have persistently quarantined ownership of such assets from the deceased and his children.”

60 Thereafter there were further submissions dealing with the history of the asset ownership during the relationship some of which accurately reflected the evidence and some did not. Most of them are set out in the history which I have set out earlier in this judgment.

61 What stands out is that the plaintiff and her son had to sell parts of the property to fund the on-going losses from the ill-fated sugarcane venture between the plaintiff and the deceased.

62 Apart from these there were two occasions when the plaintiff gave properties to her son Alec Waugh. These were:

(a) Allowing Alec Waugh to retain the proceeds of the Darling Point flat sold in June 2002.

(b) The transfer of Lots 93 - 94 Toumbaal Plains to Alex Waugh and his wife.

The sale of the Darling Point property

63 This unit was purchased in 1994 for $290,000 by the plaintiff and her son. The funds for the purchase eventually came from the resumption of the plaintiff's land at Toumbaal Plains. It was sold in 2002 for $535,000 and the plaintiff allowed her son to keep the proceeds of the sale. He would have been entitled to at least a half in any event as a presumption of an advancement would have applied to his half share in the property when he acquired it with his mother.

64 The plaintiff gave evidence that she allowed him to retain the proceeds because he had provided his share in the property at Nymboida for the benefit of the Taloumbi Station partnership and some works he had carried out on Taloumbi.

65 Alec had held his interest in Taloumbi since the early 1980s and the plaintiff’s decision to let him keep half of the proceeds is a natural one as it recognises the loss of the property which he had suffered.

66 It is to be remembered and that in 2002 the deceased was well and still practising his profession as a doctor. There was nothing to indicate the unfortunate deterioration in the deceased health later in 2005.

67 In my view there is nothing unusual in the transaction and it represents a proper consideration by the plaintiff of the interests of both herself and her son.

Lots 93 - 94 Toumbaal Plains

68 I have set out in paragraphs 33, 38 and 42 the short facts in relation to the transfer of these properties to the plaintiff's son. It was the plaintiff who transferred them from her own property which she owned for many years prior to her marriage to the deceased.

69 In respect of the later transfer in 2006, the defendant made the following submission:

“The effect of the above, it is submitted, is that the Court should treat the Toumbaal Plains land and improvements now in the legal ownership of Roy Waugh and his wife as an asset to which the plaintiff could have recourse if needs be Waugh and as at the income from which she could participate in if she wanted to; that income being from the ‘ Blue Skies Wilderness Estate’ which the plaintiff and until January 2006 (months after the death of the deceased): see Exhibit 3. It is also open to the Court to infer that the transfer of lot 93 to Roy Waugh and his wife on 31 January 2006 was done with the deliberate intent of reducing the plaintiff’s asset position in anticipation of her Family Provision Act claim and that Roy Waugh was actively involved in this worth the plaintiff. So much was put to the plaintiff and Roy Waugh in cross-examination and each denied the suggestion.”

70 The original intention to transfer Lot 93 was because Alec and his family wanted a base near Taloumbi and a place for the children to enjoy country life. After the transfer of the lot for no consideration he borrowed and spent $230,000 to construct their holiday home. This all occurred in 1999 to 2000.

71 Once the mistake was discovered in early 2005, while the deceased was still well, the plaintiff discussed the mistake and decided to do something about it. He discussed it with the plaintiff and the deceased. The plaintiff indicated that she was happy to let him have what was now effectively the two blocks in advance of his ultimate inheritance. She had formed this view as early as 1988 when they first discussed the transfer of the block of land to Alec.

72 So far as the mistake is concerned, I must say that experience suggests that such mistakes do happen to the best of solicitors. I found the explanation of the process to rectify the mistake quite believable and in my view there is no basis in the evidence to suggest that the plaintiff, after the death of the deceased, or indeed before that time, completed the transfer in order to reduce her assets to assist herself in this application.

73 It was nothing more than completing the making of proper provision for her son at a time when she did not anticipate what eventually occurred. The properties now belong to her son. She has no claim upon them. In my view they should not be taken into account in considering her assets for the purposes of the claim.

74 There was criticism of the claim because she retained a block of land known as “Elders” worth $200,000 which is not income producing and which she mainly uses as a source of firewood.

75 That may be so, but the plaintiff faces uncertainties about the future. For example, there is damage caused by subsidence to her residence and the damage has affected two of the rooms in that building.

76 The defendant’s submission also dealt with the plaintiff’s expenses and sought to reduce the amounts I have earlier referred to in this judgment. In my view the plaintiff’s evidence is clear and I note there was no challenge to this in cross-examination.

77 True it is that the plaintiff is not making profits but she is still living the lifestyle, albeit in a more restricted manner, that she and the deceased enjoyed during their lifetime.

78 I note that the plaintiff has received the amounts referred to at paragraph 44 of the defendant’s submissions. The sale of the car was forced upon her by the defendant’s actions in stopping payments. I will take into account the payments she has received to date in making my orders.

79 I do not see the need for any amount that the plaintiff is to receive to be tied up. She can, with the assistance of her son, properly manage her affairs.

80 In relation to “Elder”, I note the estate is claiming that the tractors are worth $50,000 and should be returned to the estate. That raises the possibility she may have to purchase another tractor. I have not been asked to make orders in regard to the tractors. The plaintiff is still fit and well and, having regard to that, and the activities she is regularly undertaking at her present age, I think it is appropriate to extend the life expectancy to which I have referred to in the earlier part of this judgment.

81 It seems to me that in lieu of her entitlements under the will the plaintiff should receive a legacy of $700,000. The estate has substantially been distributed and it will be necessary to designate notional estate.

82 Section 27 of the Family Provision Act is in the following terms:

(1) On an application in relation to a deceased person, the Court shall not make an order designating property as notional estate of the deceased person unless it has considered:
(a) the importance of not interfering with reasonable expectations in relation to property;
(b) the substantial justice and merits involved in making or refusing to make the order; and
(c) any other matter which it considers relevant in the circumstances.
(2) In determining what property should be designated as notional estate of a deceased person, the Court shall have regard to:
(a) the value and nature of property the subject of any relevant prescribed transaction or distribution from the estate of the deceased person;
(b) where, in relation to any such prescribed transaction, consideration was given, the value and nature of the consideration;
(c) any changes over the time which has elapsed since any such prescribed transaction was entered into, any such distribution was made or any such consideration was given in the value of property of the same nature as the property the subject of the prescribed transaction, the distribution or the consideration, as the case may be;
(d) whether property of the same nature as the property the subject of any such prescribed transaction, any such distribution or any such consideration could, during the time which has elapsed since the prescribed transaction was entered into, the distribution was made or the consideration was given, as the case may be, having been applied so as to produce income; and
(e) any other matter which it considers relevant in the circumstances.”

83 There is no evidence of matters which should be considered under Section 27 (a) and the distributions were made without notice to the plaintiff after the proceedings had been commenced. Indeed, they were not disclosed until the day before the hearing.

84 The justice and equity of the situation require that the defendant’s properties received under the will be designated notional estate. There are no other particular matters which should be taken into account.

85 The orders I make are as follows:

1. That in lieu of the provisions in the will of the deceased for the plaintiff, that she receive a legacy of $700,000.
2. The legacy is to be charged on the fund provided for the plaintiff under the will.
3. To the extent that the fund referred to in order 2 above is insufficient, I designate as notional estate:
(a) the defendant’s interest in 1 Short Street Maclean.
(b) The defendant’s shares in Epalana Pty Ltd.
4. I order that interest be payable on the sum of $700,000 if it is not paid within 3 months of today’s date and that interest will be payable at the rate provided under the Probate and Administration Act 1899.
5. Subject to any submissions, the plaintiff’s costs on an ordinary basis and the defendant’s costs on an indemnity basis to be paid or retained out of the estate of the deceased.
6. I order the exhibits to be returned.
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