White v Barron - [1980] HCA 14

HIGH COURT OF AUSTRALIA

Barwick C.J., Stephen, Mason, Aickin and Wilson JJ.

WHITE v. BARRON

(1980) 144 CLR 431

4 June 1980

Testator's Family Maintenance

Testator's Family Maintenance—Widow—Gift of annuity terminable on remarriage—Whether adequate provision for proper maintenance—Jurisdiction of court to make order for further provision—Discretion of court to make order—General principles to be applied—Testator's Family Maintenance and Guardianship of Infants Act, 1916 (N.S.W.), s. 3.

Decisions

1980, June 4.
The following written judgments were delivered:-
BARWICK C.J. In this appeal I have had the advantage of reading the reasons for judgment prepared by my brother Wilson. He there sets out the salient facts, none of which I need repeat. (at p433)

2. I regret to say that I am in substantial disagreement with what my brother proposes. I would first make some general observations. The question so far as jurisdiction is concerned is whether the widow is left without adequate maintenance. This, in my opinion, does not mean without adequate maintenance solely to be derived from the testamentary disposition which the testator has made in her favour. What he has provided in his lifetime and her own resources must be taken into consideration when considering whether or not she is left without adequate maintenance. A simple, though exceptional, illustration will afford to make the point. Suppose a widow to be a millionairess in her own right and the testator to have others for whom he should or felt he should make provision. That he may prefer to provide for them rather than for her, having regard to her private fortune, would not mean, in my opinion, that he had left her without adequate maintenance. Thus, in my opinion, the situation of a widow in totality must be considered when the question whether she is left without adequate maintenance is to be answered. (at p434)

3. Further, where the widow has no dependants and it is unnecessary that she should die possessed of capital sums, it is proper, in my opinion, when answering the question whether she has adequate maintenance, to consider whether in all the circumstances she should resort to capital to supplement her income not to such an extent as to endanger her maintenance but, on the other hand, not so little as to ensure that she dies with a capital sum. This consideration is, in my opinion, relevant in the present circumstances. (at p434)

4. Whether or not a provision terminating a benefit to a widow on remarriage causes the provision made for her to be inadequate in the circumstances is a question to be decided in all the circumstances of the case. It is not a question to be answered merely be reference to changing social mores. After all, to my mind, there may be wisdom in insisting on such a provision in particular circumstances, circumstances which include the age, character and disposition of the widow. Prima facie, it is, it seems to me, for the testator to decide whether he terminates a provision on remarriage. Such a provision for a widow as would make her an attractive prospect for marriage might well be something which a wise and even generous testator might not feel obliged to make. Of course, in particular circumstances, termination on remarriage might turn what otherwise would be adequate maintenance into inadequate maintenance. To an extent, that is suggested in this case. But, it seems to me, it is only in the event that the restriction does affect that adequacy that the court should interfere with it. (at p434)

5. Having made these general observations, I should say something about jurisdiction. It seems to me that the jurisdiction to make an order under the Act does turn on the existence of a state of fact. Of necessity, embedded in that question of fact is a value judgment as to what in all the circumstances is adequate maintenance. But that does not mean that the jurisdiction depends entirely on the discretion of the primary judge. A court on appeal, it seems to me, is entitled itself closely to examine the circumstances and for itself answer the question whether it could reasonably be held that the available maintenance was in all the circumstances inadequate. If such a view is reasonably open great weight must be given to the view of the primary judge which in general should only be overturned, in my opinion, if it is erroneous. (at p435)

6. The question of jurisdiction in this case is, to my mind, a singularly difficult one. My brother Wilson has set out the financial situation of the widow at the date of death. Briefly, she had two unencumbered residences, a motor car, a capital sum of $14,000 and an annuity of $5,200 per annum. In my opinion, it is erroneous to regard her as financially incapable of making any provision for herself against the fall in the value of money. I do not think that it can reasonably be said that she should not be expected to resort to her capital or other income to any extent in order to maintain her living standard. Her age, the state of her health, her presumed life expectancy, are all factors, along with the amount of her capital and with what demands upon it are likely, to be considered in deciding whether she should or should not have some resort to capital for that purpose. Given her financial situation and allowing for expenditure on the maintenance of the residences, it seems to me proper in this case to expect the widow to have resort to her capital, the rate of use of it to be designed to ensure that it lasts out her expectancy; that is to say, that she does not utilise the whole of it any substantial time before the end of life and allowing for the added demands which may be made upon it in her advancing years. Calculations on an assumed yield of 6 per cent could be used. (at p435)

7. In my opinion, a wise and affectionate husband leaving a wife in the situation of this widow might well consider that she should have resort in some such fashion to her capital in order to keep up the value of a sum which he considered was adequate for her maintenance. This conclusion, of course, reflects very much on whether or not the provision made by the testator with respect to inflation was adequate. He had been a businessman and he was not, in my opinion, likely to be so foolish as to think that the provision he in fact made in this connexion would be a complete hedge against inflationary changes. The fact that he did not consider automatic resort to the fund - the trustees had an absolute discretion - and the fact that, if regularly resorted to, quite obviously it could not last very long, make me think that the testator anticipated resort by his widow to her capital to some extent. It is quite evident, in my opinion, from the size of the fund he provided and the terms in which it was erected that he had considered that what he was going to provide was only a supplement to what his widow would do for herself out of her own income and capital. (at p436)

8. So far as the condition as to remarriage is concerned, I do not think that its presence really bears on the adequacy or inadequacy of the widow's situation vis a vis her maintenance. (at p436)

9. Being of these opinions, I find it difficult to resolve the question whether in all the circumstances of this case it can reasonably be said that the widow was left without adequate maintenance. In the long run, I have come to the conclusion that there are sufficient elements of judgment in the determination of that fact to warrant my taking the course of not disturbing the primary judge's finding, though I would not support his reasons therefor. Thus, I am prepared, though with hesitation, to go along with the view that there was jurisdiction in this case to make an order. (at p436)

10. The next question is what provision should be made to ensure the widow adequate maintenance. I agree with the Court of Appeal that the provision proposed by the primary judge is insupportable. I can see no justification for the view that she should be provided with two residences, however much during the joint lives of husband and wife a holiday home was desirable if not necessary. I do not think the widow would be left without adequate maintenance if she had no holiday home. (at p436)

11. The inadequacy which justifies the making of an order, in my opinion, is that the effect of the onslaught of inflation on the widow's income was inadequately provided for, even allowing for some resort by her to her capital to counteract the loss in value of money. To meet the situation, on the assumption that she would not resort for that purpose to her own resources, the Court of Appeal has provided for her annuity to be indexed to the consumer price index prepared by the Australian Statistician. This index has in its makeup elements, some of which have little relevance to the situation of this widow, who has an unencumbered residence, is fifty-nine years of age with a life expectancy according to the tables of eighteen years. Inflation to some degree has, I suppose, always been with us. At the moment it bulks larger with us both in quantum and in consequence than aforetime. If it were running at 3 per cent - as in the best of times it probably has been - this widow would have had, in my opinion, no ground for complaint. Inflation at that rate could well be absorbed by her out of her own resources. But, as I have indicated, I am prepared to accept that the testator's provision for an annuity was inadequate for want of provision towards maintaining its purchasing power. Rather than index that annuity to the consumer price index with the vagaries to which it is subject, and having regard to its constitutive elements which are or may be irrelevant to the situation of the widow, I would prefer to vary the terms of the will by increasing the fund at the disposal of the trustees to a sum which would enable them to increase the annuity annually by a percentage which was less than the consumer price index but yet substantial. I would think that an annual increment of 7 per cent would be adequate to ensure that the amount available for the maintenance of the widow did not become inadequate because of the fall in the value of money. (at p437)

12. This is my own preferred view: but if other Justices do not share it, I am prepared to accept the provision suggested by the Court of Appeal, though terminable on remarriage. In taking this course, I would not wish that order to be in any sense a precedent, encouraging a general use of the consumer price index in comparable situations. (at p437)

13. The question whether the appellant was left without adequate maintenance must be answered as at the date of death. But, of course, provision for such maintenance can be made out of the funds of the testator as they stand at the date of the making of the order, including any capacity for increase which is then present. (at p437)

14. But the nature and extent of the order should primarily be based on the situation at the testator's death. Resort can be had to subsequent increase in his estate to satisfy what the testator able to do so ought to have done. The subsequent increase in the estate cannot be used, as it were, to create a different situation as at the date of death and thus judge what is proper maintenance as if the testator had had that increased estate out of which to make provision. The court should determine what at the date of death was adequate maintenance even if at that time there would be insufficient estate to allow of an order being made to provide that maintenance. The subsequent enlargement of the estate merely enables the order which, if funds had allowed would have been made, to be made and serviced out of the enlarged estate. (at p437)

15. I would preferably vary the order made by the Court of Appeal by substituting 7 per cent for the consumer price index and leave the annuity terminable on remarriage. But, as an alternative, I would accept the order of the Court of Appeal, merely varying it by replacing the provision in the will for termination of the annuity on remarriage. (at p438)

16. Subject to the appropriate variation, I would dismiss the appeal and cross-appeal. (at p438)

STEPHEN J. I have had the advantage of reading the reasons for judgment of Wilson J. I agree with the order which he proposes and with his reasons for judgment generally. Only upon one aspect do I wish to add anything: it concerns one of the grounds relied upon in the Court of Appeal as disclosing inadequacy in the provision made in the will for the testator's widow, namely that the annuity in her favour was confined to her widowhood. (at p438)

2. That a testator should, by his will, confine to widowhood the income provision which he makes for his widow may seem to some both unfair and out of keeping with the times. Yet, in 1957, little over twenty years ago, it was said in this Court that ordinarily a widow could not be regarded as having been left without sufficient means for her maintenance and support just because provision for her was confined to her widowhood - Worladge v. Doddridge (1957) 97 CLR 1, at pp 9-10 , per Williams and Fullagar JJ.; and Kitto J. said (1957) 97 CLR, at p 20 that in most cases a court should confine to her widowhood any income provision made by it for a widow. These were not expressions of any novel views: on the contrary, they accorded with the general trend of earlier Australasian doctrine, as a reading of the judgments discloses. (at p438)

3. In the present case the Court of Appeal has said that of recent years there has been a great change in community understanding of the needs and welfare of the aged, of the preservation of mental health and of the need for companionship and the continued enjoyment of sexual relations into old age. This, together with the undesirability of encouraging deception and de facto relationships, should, it has said, encourage courts to view with disfavour, at least in the case of substantial estates, that restriction upon remarriage which an annuity confined to widowhood involves. (at p438)

4. That some changes of the kind suggested have taken place seems not at all improbable; however, because of their nature their magnitude is inherently difficult to determine. Quite major changes in accepted community values would seem to be required to render outmoded the established doctrine of some twenty years ago; and any new doctrine taking its place would first have to be shown to be the necessary consequence of those changes. (at p439)

5. Perhaps more importantly, such changes cannot be treated in isolation from the many other influences which play their part in shaping the character of our changing social environment, some of which may bear quite directly upon this question of a widow's remarriage. By way of example I instance the heightened awareness of changes in the status of women, women's own increased participation in the work-force and their greater economic independence. Each may be relevant to this question and their combined effect may appear to some minds to be to place less absolute weight upon a testator's moral duty to afford maintenance for his widow, qua widow; greater weight instead being accorded to each spouse's contribution, tangible and intangible, to family assets, to the extent that it is reflected in the value of the estate of a deceased spouse. Whether or not this be so, it seems to me that factors such as these, and there are no doubt others, should also play their part in determining the approach to income provisions which cease on a widow's remarriage. (at p439)

6. Nothing which I have said is intended to suggest that old doctrines should necessarily be adhered to. The old may be founded upon no surer foundation than are the new. The better course appears to me to acknowledge that in the area of testators' family maintenance there is relatively little room for the propounding of broad judicial doctrine, old or new, at least when it takes the form of rules of purportedly general application and relative inflexibility. (at p439)

7. This area of law is peculiarly the creature of statute. A wave of legislation, beginning in New Zealand in 1900 and extending State by State and Province by Province throughout Australia and most of Canada until finally reaching England in 1935, has restricted testators' former freedom of testamentary disposition by enacting varying versions of testators' family maintenance legislation. From time to time the enactments have been amended, almost always in the direction of wider access to the relief which the legislation affords. This has no doubt occurred in response to the pressures created by social change. Thus, in most Australian jurisdictions a divorced wife, if entitled to alimony or maintenance from her deceased former husband, has become an eligible applicant for relief. In Western Australia a "de facto" widow may now obtain relief and so, in a number of States, may illegitimate children. This is, then, an area of the law created by statute and in which legislatures appear to have been relatively responsive to the social changes which this century has seen. In New South Wales, from whence the present appeal comes, that State's Law Reform Commission reported as recently as 1977 on the Testator's Family Maintenance and Guardianship of Infants Act, 1916. In its Working Paper of 1974 the effect of a widow's remarriage upon her entitlement to apply for provision under the Act was discussed at length - pars. 6, 18-6, 23. Incidentally, neither that Working Paper nor the Commission's final Report, L.R.C. 28 (1977), proposes positive changes concerning income provisions limited to widowhood. In this jurisdiction such systematic investigation and reporting upon the adequacy of the existing law to meet the changing needs of the community, if coupled with willingness of legislatures to enact appropriate reforms, appears to me to offer a sounder basis for general rule-making, and for the changing of those rules from time to time, than will any reliance by appellate courts upon their own appreciation of those needs. (at p440)

8. There again, this jurisdiction is pre-eminently one in which the trial judge's exercise of discretion should not be unduly confined by judge-made rules of purportedly general application. A trial judge has to place himself in the position of the testator and to consider what that testator "ought to have done in all the circumstances of the case": Bosch v. Perpetual Trustee Co. Ltd. (1938) AC 463, at p 478 . No doubt this requires him to recognize and to apply prevailing community standards of what is right and appropriate since it is by those standards that the content both of the moral duty owed by a just husband and father to his wife and children and of departures from it will be measured: In re Allardice; Allardice v. Allardice (1910) 29 NZLR 959, at p 973; (1911) AC 730, at pp 734-735 . However, while appellate courts should correct miscarriages of discretion in particular cases, I question whether they should go further and propound general rules by reference to which discretion is to be exercised. With all the respect which is unquestionably due to the views of the members of this Court in Worladge v. Doddridge (1957) 97 CLR 1 , I would doubt the desirability of the formulation to be found in that case, bearing, as it does, the appearance of relatively inflexible rules affecting the discretion of a trial judge. Equally, I doubt the desirability of now propounding no less general rules which are found to conflict with those referred to in Worladge v. Doddridge. (at p440)

9. In this area of statute law, and especially in an appeal from a jurisdiction whose own law reform agency has so recently engaged in lengthy investigation and reporting, there is, perhaps, less scope than usual for judicial innovation by appellate courts. There is also little room for the formulation of general rules to guide the future exercise of curial discretion. If judicial discretion is to be subjected to such rules, this should be rather as a result of legislative intervention after full consideration by law reform agencies. (at p441)

10. As I said at the outset, I agree with the order of Wilson J. It follows that, in the circumstances of this case, I would not confine the widow's annuity to her widowhood. (at p441)

MASON J. Wilson J. has set out in detail the history of this matter and the relevant circumstances. (at p441)

2. The question whether the testator left the appellant widow "without adequate provision" for her "proper maintenance" was to be determined by the primary judge by reference to circumstances as they existed at the date of the testator's death. Once this question was answered in the affirmative, it was for the court to exercise its discretion to order adequate provision for proper maintenance for the appellant by reference to circumstances as they existed at the date of the order. See generally Coates v. National Trustees Executors and Agency Co. Ltd. (1956) 95 CLR 494 . There Dixon C. J. observed that in determining the initial question of jurisdiction the Court must look to what is "necessary or appropriate prospectively from that time", that is, the date of death, including events which are contingent as well as those which are certain or likely. Advantage may be taken of hindsight so long as the subsequent occurrences fall within "the range of reasonable foresight" (1956) 95 CLR, at p 508 . (at p441)

3. Waddell J. held that the appellant had been left without adequate provision for her proper maintenance. Despite the dissent of Mahoney J. A. on this issue, I agree with the majority in the Court of Appeal that the primary judge was correct in so deciding. It is sufficient to say that the failure of the testator to provide for the foreseeable consequences of inflation in relation to the annuity and the limitation of the annuity to widowhood together demonstrated the inadequacy of the provision which the testator made, as matters stood at the date of death. (at p441)

4. This makes it unnecessary to decide conclusively whether the primary judge's decision on the initial question of jurisdiction was one of fact or whether it reflected the exercise of a discretionary judgment. However, as the question was discussed in argument I take this opportunity to say that the observations in Ellis v. Leeder (1951) 82 CLR 645, at p 653 and the Pontifical Society for the Propagation of the Faith v. Scales (1962) 107 CLR 9, at p 19 should not be taken as supporting the proposition that the decision on this initial question of jurisdiction involves the exercise of a discretionary judgment: cf. Bosch v. Perpetual Trustee Co. Ltd. (1938) AC 463, at p 483 . In Ellis v. Leeder at first instance Sugerman J., having held that the widow had been left without adequate provision for her proper maintenance (1951) 82 CLR, at p 650 , had proceeded to exercise his discretion against making an order on the grounds that there were no available assets from which the order could be made and that the making of an order could disturb arrangements made by the testator for the payment of his creditor (1951) 82 CLR, at p 650 . Consequently, the references in the joint judgment of Dixon, Williams and Kitto JJ. (1951) 82 CLR, at p 653 to the exercise of a discretion by Sugerman J. and to the discretionary jurisdiction to which the statute refers, relate, not to the initial question of jurisdiction, but to the discretion which the court has, to make or to refuse to make an order in favour of the applicant once jurisdiction has been established. (at p442)

5. The same may be said of Scales. There the primary judge made orders in favour of a widow and a son. By majority this Court held that no order in favour of the son should have been made, evidently on the ground that the jurisdiction could be exercised adversely to the applicant. Dixon C. J. (with whom McTiernan J. agreed) said (1962) 107 CLR, at p 19 : "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." There is nothing in this to suggest that the jurisdictional decision involves the exercise of a discretion. True it is that the remarks of Taylor J. (1962) 107 CLR, at p 25 seem to suggest otherwise, but his was a dissenting judgment. (at p442)

6. The correct approach was illustrated in McCosker v. McCosker (1957) 97 CLR 566 . The primary judge made an order in favour of an adult son. By majority this Court held that, although the applicant was entitled to an order, the order in fact made was too generous and should be reduced. Dixon C. J. and Williams J. in their joint judgment drew a distinction between the jurisdictional issue and the exercise of the discretion to make an order. They said (1957) 97 CLR, at p 575 :

"The power of the court to make an order under the Act depends upon proof that a testator has died leaving a will which does not make adequate provision for the proper maintenance, education or advancement in life of the applicant. If that is proved, the court may at its discretion, and taking into consideration all the circumstances of the case," make an order.

The majority then proceeded to determine the issue of jurisdiction for themselves (1957) 97 CLR, at p 576 and, having done so, satisfied themselves that the primary judge had erred in exercising his discretion by making over-generous provision (1957) 97 CLR, at pp 576-578 . (at p443)

7. Likewise, in Stott v. Cook (1960) 33 ALJR 447, at p 448 Dixon J. said: "As has often been pointed out, the preliminary condition must be satisfied before the court's discretion to make an order arises." Later his Honour said (1960) 33 ALJR, at p 449 :
"We cannot say that on the material before him his Honour ought not to have been satisfied that the preliminary condition to the exercise of his jurisdiction was fulfilled. Can we say that he ought in the exercise of his discretion to have refused the application rebus sic stantibus? It is a conclusion that I am unable to adopt." (at p443)

8. There is an element of the artificial in saying that it is only after jurisdiction is established that the exercise of discretion begins, for the twin tasks which face the primary judge are similar. He has first to decide whether the applicant was left without adequate provision for proper maintenance. He has then to decide, amongst other things, what order, if any, will accord to the applicant such adequate provision. That the two issues have to be decided by reference to circumstances prevailing at different times is not a reason for the distinction. The explanation is to be found in the language of s. 3 of the Testator's Family Maintenance and Guardianship of Infants Act, 1916 (N.S.W.), as amended. It conditions the exercise of the jurisdiction on the fact that the applicant is left without adequate provision for proper maintenance and then provides that the court "may, at its discretion" make an order in favour of the applicant. But the similarity of the two questions tends to indicate, as Dixon C. J. suggested in Scales (1962) 107 CLR, at p 19 that "Perhaps this Court and other Courts of Appeal have attached too much significance to the discretionary aspects of orders . . .". (at p443)

9. The crucial issue in this case is whether the Court of Appeal was right to set aside the discretionary order made by the primary judge and to substitute the order which it made in favour of the appellant. This issue involves two questions: (a) whether the order made by the primary judge constitutes, in accordance with accepted principle, an erroneous exercise of the discretion entrusted to him by the Act; and, if so, (b) whether the order made by the Court of Appeal was also an erroneous exercise of the discretion which, on appeal, was entrusted to it. (at p444)

10. It is, I think, evident that the primary judge erred in exercising his discretion to make the order which he made in favour of the appellant. The magnitude and nature of the additional provision reflected an erroneous standard of what is adequate provision for proper maintenance of a person in the appellant's situation, having regard to the claim which she had on the testator's bounty and to the size of the estate at the date of hearing. The provision of a legacy of $75,000 in addition to a direction that the trustees purchase a home unit for $65,000 to be used by her as she might choose during her life, though in substitution for benefits conferred by the will, constitutes provision which was more than adequate for her proper maintenance. (at p444)

11. The justification advanced by the primary judge for the provision of the legacy of $75,000, in lieu of the annuity given by the will, was that it would provide a sum which, added to the moneys she already possessed, "having regard to the rents which she might derive from the property in which she is not living, should provide an adequate safeguard against inflation". For the reasons given by Wilson J. and the majority in the Court of Appeal, this legacy greatly exceeded what was necessary to protect the appellant, and for that matter the annuity which she received under the will, from the consequences of inflation. (at p444)

12. With Wilson J. and the majority in the Court of Appeal, I would reject the view expressed by Kitto J. in Worladge v. Doddridge (1957) 97 CLR 1, at p 20 that in most cases "the maintenance order for a widow should be confined to continuance of widowhood". Community attitudes have so altered that it is now generally accepted that a widow should be maintained for life, rather than during widowhood. Nor do I subscribe to the proposition that an order in favour of a widow should necessarily be confined to an income provision. Circumstances are infinite in their variety and orders must be moulded to the circumstances of the particular case in order to ensure that the provision which is made is adequate for the proper maintenance of the widow, where that is possible. A capital provision should only be awarded to a widow when it appears that this is the fairest means of securing her proper maintenance. However, the provision of a large capital sum for a widow who is not young, may, in the event of her early death, result in a substantial benefit to her relatives, contrary to the wishes of the testator, when a benefit of another kind would have afforded an adequate safeguard to her personally, without leaving her in a position in which she could benefit her relatives from the proceeds of the legacy. In the present case I am unable to perceive the justification for the award of a legacy as large as $75,000. It was unrelated to the established needs of the appellant and it certainly went beyond what was necessary to cure the provisions of the will of the disability that the annuity was inadequately protected from the consequences of inflation. (at p445)

13. However, I agree with the reasons given by Wilson J. for concluding that the primary judge was right in directing the trustees to utilize the sum of $65,000 in providing the appellant with a unit in Sydney for so long as she requires it. In this respect the primary judge's order should be restored for I consider that the standard applied by the Court of Appeal fell short of a correct appreciation of "proper maintenance" for a widow in the appellant's situation. I also agree with the annuity in the form proposed by the Court of Appeal; it would adequately protect the appellant from the consequences of inflation, more particularly when she has the benefit of the home unit in Sydney which the primary judge directed the trustees to purchase. (at p445)

14. The provision now seen to be appropriate for the appellant's proper maintenance is somewhat larger than that which might have seemed adequate as at the date of the testator's death. This is because intervening events have resulted in changed circumstances and in a clearer perception of the appellant's needs. (at p445)

15. I am conscious that the orders now proposed by Wilson J. yield a fourth solution to the problem posed by the appellant's application. Mahoney J.A. held that the appellant failed at the jurisdictional threshold. Reynolds and Hutley JJ.A. thought that a limited additional benefit should be provided and the primary judge considered that extensive additional benefits should be ordered. The solution now proposed is pitched at a level of benefit which lies between that favoured by the majority in the Court of Appeal and that ordered by the primary judge. It is unfortunate that there can be such a difference of opinion in relation to the exercise of a judicial discretion. But the case is a difficult one and the difference of opinion partly reflects the problems which are inherent in adjusting the court's approach to the application of the Act so that it conforms more closely to current community standards. (at p445)

16. I would allow the appeal, dismiss the cross-appeal and make the other orders proposed by Wilson J. (at p445)

AICKIN J. The facts upon which this appeal turns are set out in the reasons for judgment of my brother Wilson and I do not need to restate them out in full. I find it convenient however to state briefly the material provisions of the will and of the order of Waddell J. at first instance and of the majority of the Court of Appeal. (at p446)

2. In his will the testator "directed his trustees to set aside and invest a trust fund sufficient in their opinion to provide an annual income of $5,200 for his wife during her lifetime or until she should remarry". The trustees were directed to invest a further sum equal to 10 per cent of the trust fund and to accumulate the income therefrom and at their discretion to pay to his widow such amount as would "together with the annuity" equal the purchasing power at that time of $5,200. The testator directed that the residue be divided between his son and his daughter, the son having been given a specific legacy of shares in a company, Allens Sweets Pty. Ltd., valued at the date of death at $89,830. Between the date of death and the date on which the proceedings were heard at first instance the shares had been the subject of a take over offer the result of which was to provide a sum two and a half times the probate value of the shares. The testator's will was dated September 1975 and he died on 30th November 1975. The hearing before the trial judge was in June 1978 and judgment was given in July 1978. (at p446)

3. The trial judge found that the will did not make adequate provision for the widow and he made an order that in lieu of the other provisions of the will the widow was to receive a legacy of $75,000 and that the executors should spend a sum not exceeding $65,000 in the purchase of a home unit of which the widow approved. He also made an order in favour of the testator's daughter that she should receive a legacy of $60,000 in lieu of a half share in residue. There was no appeal in respect of that part of his order. (at p446)

4. In the Court of Appeal the majority varied the order in favour of the widow by directing the investment of a sum of $80,000 and payment to the widow of the sum of $5,200 per year during her life, such sum to be varied by reference to the consumer price index at the 1st January each year, the amount to be payable out of income and in so far as that was insufficient out of accumulated income and ultimately out of capital. (at p446)

5. It is settled law that under testator's family maintenance legislation applications are to be dealt with as at the date of the testator's death. There are however two glosses on, or explanations of what is involved in, that general proposition. The first is that events reasonably foreseeable at the date of the death may be taken into account in determining the first question, i.e. whether the will makes "proper provision", and the second is that, the first question having been answered in the affirmative, the discretion should be exercised in the light of the value of the estate at the date of the hearing. (at p447)

6. The basis for this view is conveniently explained in two passages from the judgment of Dixon C.J. in Coates v. National Trustees Executors and Agency Co. Ltd. (1956) 95 CLR 494 . In the first passage, after referring to the decision of Townley J. in Re Brown, deceased (1952) QSR 47 , Dixon C.J. said (1956) 95 CLR, at pp 507-508 :

"In the course of his reasons Townley J. referred to the statement made in Bosch v. Perpetual Trustee Co. (Ltd.) (1938) AC 463, at pp 478, 479 for the Privy Council by Lord Romer to the effect that the court must place itself in the position of the testator and consider what he ought to have done in all the circumstances of the case, treating the testator for that purpose as a wise and just rather than a fond or foolish husband or father. The learned judge then said: 'To take into consideration changes in circumstances which could not have been foreseen by the testator would be to attribute to him not only wisdom and a sense of justice but also the gift of prophecy. What the testator "ought to have done in all the circumstances of the case" could only be determined by a consideration of matters as they stood, at the latest, at his death. Unforeseeable circumstances arising after that event surely could not govern the wisdom or justice of his actions whilst alive. The court is required to determine whether or not he has made adequate provision in his will for the proper maintenance and support of the applicant which would seem to indicate that the court is to put itself in his position, attributing to him justice and wisdom, not after but immediately before death' (1952) QSR, at pp 49-50 . The considerations stated by Townley J. in this passage confirm the interpretation which the actual words of the provision suggest. But it is important to see what exactly is involved in that interpretation. It means that the court determining the application must look at the will which the testator leaves and the dispositions if any which it contains in favour of his widow or children as the case may be and consider whether they amounted to an adequate provision for her or their proper maintenance and support. But the very question what is proper maintenance and support involves the future of the widow or children to be maintained or supported. It is, however, the future stretching forward from the date of the testator's death and therefore considered as from that date. It involves what is necessary or appropriate prospectively from that time. To determine that question contingent events must be taken into account as well as what may be considered certain or exceedingly likely to happen. When a court is called upon to consider such a question many years after the date as at which the court must take its stand, all the advantage is available of knowing the events that have occurred. The intervening events may be taken into consideration because they suggest or tend to show what antecedently might have been expected. But they must not be outside the range of reasonable foresight. If all contingencies that might reasonably have been anticipated have been taken into account, it would be difficult to say that the actual occurrence of some event which antecedently no one could reasonably have foreseen shows that the maintenance or support was not proper or the provision therefor was not adequate. It is therefore impossible to treat actual intermediate occurrences as more than evidentiary facts. The ultimate question must remain one of adequate provision for proper maintenance and support as at the date of the testator's death."

The second passage is as follows (1956) 95 CLR, at pp 508-509 : "It must be borne in mind that the question whether the deceased has left a will without making adequate provision for the proper maintenance and support of his widow or his children is only the first or preliminary question which is set by s. 139. If, but only if, the court answers that question in the affirmative, it may, subject to the other provisions of Pt V, proceed to 'order that such provision as the court thinks fit shall be made out of the estate of the testator for such widow widower or children'. The discretion conferred by these words is of course limited by the purpose and scope of the legislation. And what has been just said bears upon the purpose and scope of the legislation. But it would not be a proper exercise of discretion if the facts as they exist at the time the order is made were left out of account. If a child, through some accession of fortune, had ceased before the hearing of the application to require any further provision for his maintenance or support it would not be a proper exercise of discretion to make an order in his favour on the ground that it was only after his father's death that his needs were thus met. It is not a discretion to give more than what is adequate for proper maintenance in the circumstances as they have come to exist. On the other hand it is not a discretion to make a provision for proper maintenance and support which exceeds any provision that the foresight, wisdom, and fairness of a reasonable man in the testator's situation would have led him to make for the proper maintenance and support of the widow or child applying." (at p448)

7. Although "the ultimate question" must be determined as at the date of the testator's death, those limited uses of later events may be made. They must not however be permitted to extend to the substitution of hindsight for reasonable foresight for that would be to distort the purpose of legislation, namely to provide by way of a "statutory codicil" that which the testator himself should have done in his will. (at p448)

8. The first of these questions is one of law in the sense that it involves the application to the facts of a legal criterion, notwithstanding that it involves a value judgment by the court. It is however not the exercise of a judicial discretion within the ordinary meaning of that term. The second question does involve the exercise of such a discretion. (at p449)

9. It is necessary to bear in mind that although these are separate questions they may in some circumstances come at least very close to each other and a favourable determination of the first may substantially influence the answer given to the second. In a case where the will makes no provision for a widow it is unlikely that a conclusion that adequate provision has not been made will greatly assist in the determination of the nature and quantum of proper provision. However in a case where some provision is made but the court concludes that it is not adequate, such a conclusion necessarily involves some comparison with what would have been adequate. It thus must necessarily "intrude" into the area of the second question. (at p449)

10. The second question is however to be determined by reference in one respect to different facts, namely it is to be determined by reference to the value of the estate as at the date of the trial, and may therefore result in a conclusion different from that which would have been arrived at as at the date of the death. This is a somewhat different process from taking into account as at the date of death future events which were reasonably forseeable. (at p449)

11. The widow had at the date of death some substantial assets, including two houses, one a town house in Sydney and the other a house at Bateman's Bay. Those two residences had been used by both husband and wife but were the property of the widow, though the testator had provided the funds for building the house at Bateman's Bay. In addition she had some $11,000 invested in a first mortgage and debentures. The relevant interest rates were not stated, but it is clear that those assets would not produce a substantial revenue. It would have been reasonably foreseeable however that one of the houses would be let and the other used as a residence with possibly some interchange between the two. This would have augmented her income. (at p449)

12. The testator made an income provision by providing an annuity and in doing so adverted to the problem of inflation by providing a limited means for augmenting that annuity. Some evidence of estimated rates of inflation in future years was given by an economist, Dr. Horn. The trial judge made no finding on this matter, saying that it was agreed between the parties that "as at the date of death the likelihood was that over the following twenty years the rate of inflation would average not less than five per cent". He concluded that the provision in the will for additional income would on that basis be exhausted within three years. He concluded therefore that the testator "did not make adequate provision to safeguard his widow against the erosion of money values by inflation". (at p450)

13. The evidence and admission on which this conclusion was arrived at seem to me, with respect, to be directed to a different question. The first question was not the rate of future inflation estimated or admitted, as at the date of the trial. It was what would have been within the reasonable foresight of the testator at the date of his death, which is not by any means the same thing. That evidence was however relevant to the second question. (at p450)

14. On the whole, however, I think it right to say that the testator failed to make proper provision for his widow by reason of an inadequate allowance for the adverse effect of inflation. Inflation is no doubt more easily measured by hindsight but some estimate may be made by foresight. If one attempts now to look forward as from the date of death (30th November 1975), endeavouring to put aside hindsight, it is proper to conclude that the provision should have appeared inadequate to the testator in the light of the then prevailing rate of inflation. (at p450)

15. It is not necessary to decide whether a court may take judicial notice of official statistics on the topic because a written statement by Dr. Horn, which was received in evidence without objection, showed the rates to have been 13.2 per cent in 1973, 15.8 per cent in 1974 reducing to 13.8 per cent in 1975. Even the existence of much lower rates in 1970, 1971 and 1972 would not warrant the conclusion that a continuation of inflation from some time to come was other than reasonably foreseeable. (at p450)

16. For those reasons I agree that in this respect the testator did fail to make adequate provision for his widow and that it is necessary therefore to proceed to the second question. The net value of the residuary estate after payment of debts and death duties was $113,267. The executor had calculated that to provide the annuity given by the will a sum of $80,000 should be set aside and this was not challenged. The takeover of the shares bequeathed to the son occurred in September 1977 and brought into the estate the sum of $222,182, i.e. $132,352 more than the probate valuation. (at p450)

17. The trial judge concluded that the widow should receive a capital sum of $75,000. He also ordered that the executor should spend a sum not exceeding $65,000 in the purchase of a townhouse in which she would have a life interest, subject to paying the expenses of maintenance. (at p450)

18. The latter provision or at least its form arises out of an event which occured after the testator's death. In November 1976 the widow sold the town house for $62,000 and invested the proceeds in fixed interest securities. She moved to the house at Bateman's Bay where she planned to reside permanently. She spent some $11,000 in converting it from a holiday house to a permanent residence. She subsequently changed her mind and by the time of the hearing wished to return to Sydney as her permanent residence, while retaining the house at Bateman's Bay and to have the residence in Sydney provided by the estate. The acceptance of that submission produced the order referred to. (at p451)

19. With due respect to those who have taken the view that such a provision was proper I am unable to see how it could be justified. To make such an order is to take the view that the testator failed to make adequate provision for his widow, who already owned two houses, by failing to give her a third house. It does not seem to me to be a proper exercise of this jurisdiction to say in effect that the testator should have foreseen that his wife might wish to sell the town house and live in the holiday house when suitably renovated, and therafter change her mind and wish to have two houses. Reasonable foresight may well have extended to the decision to keep one house only, and to the possibility that she might let one or other from time to time and thus augment her income. In my opinion this provision is to go far beyond anything authorized by the principles which have been laid down in the cases, and represents a provision so large as to demonstrate that the discretion has miscarried. (at p451)

20. In this respect I agree with the view of the majority of the Court of Appeal that it is quite unsound to conclude that because there were two houses during the testator's life, she is entitled to demand and be awarded the restoration of that situation after she has sold one of them. It is well settled that proper provision does not mean the standard of maintenance and the way of life available during the testator's life. The impact of death duties alone would in this case make that impossible, with regard to moral obligations to others. (at p451)

21. The income which she now receives from the proceeds of sale of the town house represents in a sense the income which could have been obtained by letting the town house, and should be regarded simply as the income from a reinvestment of part of her capital assets. It demonstrates however the amount of additional income available to her, even though the rate of interest on those investments was not revealed. (at p451)

22. All members of the Court of Appeal regarded the trial judge's order as incapable of being supported and in my opinion they were correct in this. The majority thought that some further provision in respect of income for the widow was required. They thought there were two deficencies, one being inadequate provision for inflation and the other than the annuity would end on remarriage. To correct the former they ordered that a fund of $80,000 should be set aside and that the widow be paid an annuity of $5,200 per annum to be adjusted each year by reference to the consumer price index, and that it be paid out of the income and then out of the accumulated income and if necessary out of the capital of that fund. As to the latter they thought the annuity should not end on remarriage. (at p452)

23. I do not consider that indexation of annuities by reference to the consumer price index can often be a proper course for making provision. It will generally delay the distribution of an estate for an undue period and may seriously interfere with provision for other beneficiaries. The provision in the order made by the Court of Appeal charging the annuity on both income and capital of an adequate capital sum mitigates those undesirable effects to some extent. However the consumer price index is as uncertain in its impact on an individual person as is what is miscalled the "expectancy of life" of any individual person of a specified age. Both are statistical devices which have their uses. (at p452)

24. I do not however consider that the use of the consumer price index is appropriate in the present case. I agree with the Chief Justice that something less than "full indexation" might be an appropriate course in the present case, whether by way of a fixed annual increase as he suggests or by way of some percentage of the consumer price index so as to provide "partial indexation" does not matter in the circumstance. My own perference would be for partial indexation at 60 per cent of the published figure so as to make provision for changes in the rate of inflation. (at p452)

25. I turn now to that part of the Court of Appeal's order which deletes the provision of the will by which the annuity ceases on remarriage. It was said by the majority that community standards had changed and that it was now regarded as improper for a widow's life or annuity to be limited and that such a provision encouraged deception and de facto not de jure relationships. These matters are presumably referred to as being matters of judicial notice. I am unable to regard them as self-evident or representing community views to the exclusion of other conflicting views. It is still the fact that both the law and the community regard a husband, including a second husband, as under an obligation to provide support for his wife. Moreover there are now many more who take at least a lenient view about de facto relationships than there were thirty years ago. (at p452)

26. None of these are absolutes and in this field of the law it is undesirable to attempt to lay down general rules about what is and what is not desirable by way of provision for any category of claimant. Each case depends on its particular circumstances and generalizations are unlikely to be helpful. (at p453)

27. I do not think that it can be said that to provide an annuity which terminates on remarriage is of itself sufficient to demonstrate inadequacy of provision. Nor do I think that the view expressed by Kitto J. in Worladge v. Doddridge (1957) 97 CLR 1, at p 20 can be regarded as a general rule. It is plainly a matter for consideration in each particular case in the light of all the circumstances. Neither the absence nor the presence or cessation of a provision on remarriage can be of itself a reason for concluding that adequate provision has or has not been made. Nor is its deletion an essential ingredient in proper provision for a widow. (at p453)

28. In the present case I can see no sound reason for interfering with the testator's will in this respect. It is however a matter of discretion and to make such an alteration in the present case is not outside the range of that discretion. I would not myself so exercise that discretion. (at p453)

29. In my opinion the appeal and the cross-appeal should be dismissed but the order of the Court of Appeal should be varied in the manner which I have indicated. (at p453)

WILSON J. This is an appeal and cross-appeal from a decision of the Court of Appeal of the Supreme Court of New South Wales in the field of testator's family maintenance legislation, a field described by Fullagar J. even as long ago as 1956 as "a much ploughed, if not very well harrowed, field": Coates v. National Trustees Executors and Agency Co. Ltd. (1956) 95 CLR 494, at p 517 . The intervening years tend to confirm the accuracy of the observation. The principles to be applied are not in doubt, yet it is a consequence of the nature of the legislation that the circumstances of each individual case will often dictate its own distinctive result. (at p453)

2. The testator Clarence Hodgkinson White died on 30th November 1975, aged seventy-five years. He had married the present appellant in 1966, shortly after the death of his first wife. There are two children of the first marriage, none of the second. Apart from the two children, who now of course are middle-aged, and the appellant, there are no other persons who might be considered to have any claim on the bounty of the testator, and it is agreed that the appeal may be dealt with without regard to the effect on the interests of the children of any order that may be made. The estate is a substantial one. (at p453)

3. The appellant had a close association with the testator since 1941. She was described by the trial judge (Waddell J.) as "a devoted companion and later wife" to the deceased. (at p454)

4. It is convenient at this point to summarize the economic position of both the testator and Mrs. White at the time of his death, and subsequently. Mrs. White owned a townhouse at Wollstonecraft in which she and Mr. White lived for the greater part of their married life. This was sold in November 1976 for $62,000. She had acquired, also from her own resources, a block of land at Bateman's Bay, and in 1973 Mr. White had made a gift to her of approximately $18,000 which was used to erect a holiday cottage on this land; the value of land and buildings is estimated at date of death at $40,000, and at date of hearing (July 1978) $46,000. She owned a motor car which had cost $4,000 when acquired in 1974, and some other assets amounting to $14,000, including $10,000 on first mortgage. Between Mr. White's death and the hearing of her application, Mrs. White had sold the Wollstonecraft property and gone to live at Bateman's Bay, spending more than $12,000 on that property to make it satisfactory as a permanent residence; however, the trial judge accepted her evidence that she regretted the decision to live at Bateman's Bay and wished to return to Sydney to live. Her position then at the hearing was that she had the Bateman's Bay property and a capital sum to invest of about $64,000. (at p454)

5. The net estate of the testator after payment of duties amounted to approximately $203,000. This included a parcel of shares in Allens Sweets Pty. Ltd., valued for probate at $89,930. These shares were later the subject of a takeover offer, and the executors received the sum of $222,192.30, thus augmenting the total assets available for distribution to $335,459. The shares in question were bequeathed to the testator's son Richard, so that unless the terms of the will are altered the benefit of their augmented value will go to him. (at p454)

6. Finally, the trial judge found that Mr. and Mrs. White had a comfortable and affluent life together, he having enjoyed for many years before his death an income of about $25,000 a year which yielded about $14,000 after tax. On many occasions throughout the marriage he offered his wife gifts of money and shares which she refused. (at p454)

7. By his will, the testator directed his trustees to provide Mrs. White with an annuity of $5,200 per annum during widowhood, subject to her paying the income tax on the income from such investments as were required to furnish the annuity. He also directed the trustees to invest a further capital sum equal to 10 per cent of the annuity fund and to accumulate the interest thereon and in their absolute discretion to make such payments to her from that accumulated interest as would maintain the purchasing power of the annuity. It is common ground that if this provision was intended to provide a "hedge against inflation" then it was quite inadequate for the purpose as it would be exhausted within two years. (at p455)

8. In March 1977, Mrs. White instituted proceedings in the Supreme Court of New South Wales, claiming that such provision as the Court thought fit be made for her out of the estate of her late husband pursuant to the provisions of the Testator's Family Maintenance and Guardianship of Infants Act, 1916 (N.S.W.), as amended. (at p455)

9. The jurisdiction of the Court to deal with such a claim appears from s. 3 of the Act. It depends upon a finding by the Court that the testator: "disposes of or has disposed of his property either wholly or partly by will in such a manner that the widow, husband, or children of such person, or any or all of them, are left without adequate provision for their proper maintenance, education, or advancement in life as the case may be". Given such a finding, then "the court may at its discretion, and taking into consideration all the circumstances of the case, on application by or on behalf of such wife, husband, or children, or any of them, order that such provision for such maintenance, education, and advancement as the court thinks fit shall be made out of the estate of the testator for such wife, husband, or children, or any or all of them". (at p455)

10. Waddell J. concluded that the deceased was under a moral duty to make greater provision for his widow than he did by his will, on the basis that he did not make adequate provision to safeguard her against the erosion of money values by inflation. He examined the then existing circumstances, and made an order so far as material as follows:

"1. In lieu of the provisions made by the Will of the deceased for the Plaintiff Muriel Frances White there be provided out of the estate of the deceased for the said Plaintiff the following benefits: (a) as from the date of death up to and including 12 October, 1978 the annual sum of $5,720.00; (b) a legacy (payable in priority to all other interests in the Will of the deceased and free of all death and estate duty) in the sum of $75,000 not to bear interest in respect of the period prior to 12 November, 1978;

(c) the trustees shall spend a sum not exceeding $65,000 in the purchase of a home unit selected by the said Plaintiff which she may live in or let as long as she wishes, she keeping the unit in good repair and insured in a manner approved by the trustees and paying all rates, taxes, levies and expenses in respect of the unit, and after her death the home unit shall be sold by the trustees and the proceeds divided equally between the Plaintiff Judith Martin and Richard Todd White . . ." (at p456)

11. On an appeal by the executors, the Court of Appeal by majority (Reynolds and Hutley JJ.A.) upheld the trial judge's assumption of jurisdiction. Their Honours took the view that the provision made by the testator was inadequate in two respects: it was ineffective to meet the impact of inflation, and the annuity should not have terminated on remarriage. However, their Honours found the orders made by Waddell J. to be unsupportable. They ordered that the will be varied by requiring the Trustees to pay the annuity to the widow during her life and to maintain its purchasing power by indexing it to the consumer price index. Mahoney J.A. dissented on the ground that the provisions in the will were adequate for the wife's proper maintenance, and that Waddell J. erred in principle in holding otherwise. He would have allowed the appeal and dismissed the application. (at p456)

12. Mr. Rayment, for the appellant, seeks the restoration of the order of Waddell J. He argues, in the first place, that it should be restored because it was right; alternatively, the Court of Appeal should not have interfered with it because of its discretionary nature. The latter argument is clearly relevant to the actual provision that the trial judge ordered to be made, as there can be no doubt that a decision as to the provision that "the court thinks fit" to be made out of the estate of the testator is a decision of that nature. The argument may not carry the same force when the question under consideration is whether the court should have assumed jurisdiction to make any order at all. Section 3 (1) does not describe the jurisdiction of the court in terms which confer a discretion; it provides simply that if it be the fact that a testator disposes of his property by will "in such a manner that the widow, husband, or children of such person, or any or all of them, are left without adequate provision for their proper maintenance, education, or advancement in life as the case may be", then the court may at its discretion proceed to make an order. Having regard to the guidance of the Privy Council in Bosch v. Perpetual Trustee Co. Ltd. (1938) AC 463, at pp 478, 479 , the court, in order to answer that jurisdictional fact, "must place itself in the position of the testator and consider what he ought to have done in all the circumstances of the case, treating the testator for that purpose as a wise and just, rather than a fond and foolish, husband or father". I note that Mahoney J.A. cites a passage from a joint judgment of Dixon, Williams and Kitto JJ. in Ellis v. Leeder (1951) 82 CLR 645, at p 653 for the proposition that the jurisdiction conferred by the Act is a discretionary jurisdiction. The extent to which that case does support the proposition would, I think with respect, invite closer consideration in a case in which an answer was really material. In my opinion, this is not such a case. Whether or not the assumption by Waddell J. of jurisdiction to vary the will was based on a finding of fact or an exercise of discretion it was, I think, a correct decision. Mr. Morling, for the executors, argued in support of the decision of Mahoney J.A. that there never was any jurisdiction to make an order. He draws a picture of the widow, aged fifty-nine at the date of death of the testator, without dependants, owning two pieces of unencumbered real estate to an aggregate value of approximately $100,000 plus a car and $14,000 in cash or mortgage. On top of this, the testator bequeathed to her an annuity of $5,200 a year. (at p457)

13. The Privy Council in Bosch's Case (1938) AC 463 made it clear that what is "adequate provision for proper maintenance" was not a question to be determined solely by reference to the material needs of the widow. All the circumstances, including the size of the testator's estate at the date of death and the style of life to which the widow had been accustomed during his lifetime are relevant to this question. Generally speaking, it may be wrong in principle for a court to assume jurisdiction under this legislation in order to build up out of the estate of the testator the capital assets of an elderly widow. But conversely I do not think a wise and just testator would think it right for his widow to be required to draw on her own capital assets in satisfaction of her need of proper maintenance, especially when he had the means to protect her from the risk of financial anxiety in the future by a provision which enabled her to conserve her own capital. (at p457)

14. In the present case, at the time of her husband's death Mrs. White had a life expectancy of eighteen years. The only significant provision which her husband made for her in his will was to provide an annuity of $5,200 a year during her widowhood. Mr. Rayment provided the Court with calculations to show that at an annual inflation rate of 5 per cent an annuity of $100 per week would be reduced effectively to $59.87 in 10 years, and $35.85 in 20 years; inflation of 9 per cent would bring it down to $38.94 in 10 years. The testator himself recognized the adverse effect of inflation on the annuity, and made some attempt to protect the bequest against it; whether through error or inadvertence, the attempt was wholly inadequate. Given a disposable estate in excess of $200,000 at the date of death, and all the circumstances of the case, in my opinion Waddell J. was fully justified in finding that the testator had failed to make adequate provision for his wife's proper maintenance. Mr. Morling pressed the view that the testator might well have considered that Mrs. White's personal fortune in realty was a sufficient hedge against inflation, but I think the trial judge was right in rejecting that view, particularly in circumstances where the testator attempted to make express provision otherwise: cf. Bosch's Case (1938) AC, at p 481 . (at p458)

15. I therefore agree in this respect with the decision of the majority in the Court of Appeal. However, their Honours also grounded the existence of jurisdiction on the fact that the testator made the grant of the annuity terminate on remarriage. The trial judge did not consider this question in relation to jurisdiction, and there was no occasion for him to consider it when exercising the jurisdiction because he set aside altogether the provision for an annuity into the future. Having affirmed the decision of Waddell J. on jurisdiction, I find it unnecessary to consider whether the Court of Appeal was correct in basing jurisdiction additionally on this alternative ground. (at p458)

16. I now come to the question of the orders that have been made. As was remarked in Bosch's Case "the task of exercising the power must always be one of great difficulty and delicacy" (1938) AC, at p 483 . It must be borne in mind that the size of the estate at the time when the discretion comes to be exercised is a relevant factor. By the time the case came to trial, it had profited from the "windfall" arising from the takeover of Allens Sweets, giving a disposable estate of $335,459. The record reveals that as at 29th June 1978 the value was estimated at $352,398. But of course the size of the estate is only one of the relevant factors. The task of Waddell J. was to make adequate provision for the proper maintenance of the appellant. (at p458)

17. I accept the proposition that the court should keep interference to the will to the minimum required to discharge the jurisdiction conferred by the Act. In my opinion, Waddell J. clearly erred in thinking that the appellant's proper maintenance required provision of a legacy of $75,000. It is one thing to find it reasonable to enable a widow with personal means and a substantial expectation of life to protect those means, but it is an entirely different thing to vary a will with a view to building up her capital assets. I therefore agree, with respect, with the view of the Court of Appeal which found that provision unsupportable. However, I have greater difficulty in rejecting the provision for the trustees to set aside a sum to provide a home unit for the appellant to live in for so long as she wishes. In my opinion, the provision of an annuity of $100 per week, even though indexed as provided by the Court of Appeal and not terminable on remarriage, does not sufficiently secure proper maintenance for the appellant. (at p459)

18. The effect of that decision would be this: Mrs. White would receive from the estate an income for life of $100 per week, indexed to cost of living increases; she would have the Bateman's Bay property valued at something less than $50,000, and cash resources of approximately $64,000. Accepting her wish to return to Sydney to live, the capital outlay required for securing a suitable unit would be roughly equivalent to her total cash resources. The annuity would be quite insufficient to enable her to furnish and maintain the unit and meet ordinary living expenses, thus obliging her to turn the Bateman's Bay property to producing income. If it were sold, her total annual income, including the annuity, would be in the vicinity of say $9,000 before tax. In itself, this would appear to be adequate, provided she continues to enjoy good health and suffers no other adverse turn of events. But her only security against the uncertainties of the fifteen to twenty years or more of life which might reasonably remain to her is the capital sum representing the proceeds of the Bateman's Bay property. The moment she has to resort to that capital, her income is threatened, with accompanying financial anxiety. (at p459)

19. It is not a case of saying that she should continue to have both a Sydney residence and a holiday home reserved for her sole use. Waddell J. certainly anticipated that having been provided with a unit in Sydney she would be able to derive some income from the Bateman's Bay property, but at the same time she should be able to derive personal enjoyment from it occasionally. (at p459)

20. Having regard to the size of the estate, I do not think that the decision of the Court of Appeal makes suitable provision for her maintenance. With a substantial life expectancy ahead of her, she should be able to conserve without difficulty her personal assets against the uncertainties of the future. I would think too that a provision from the estate which enabled her to please herself whether or not she retained the Bateman's Bay property and the use to which she put it would not exceed the provision of "proper maintenance". For these reasons, I would require the trustees to utilize the sum of $65,000 in providing her with a unit in Sydney for so long as she requires it. (at p459)

21. For the rest, I would respectually accept as proper the order made by the Court of Appeal. The provision of an annuity, properly protected from inflation, is clearly to be preferred in the circumstances of this case to the legacy proposed by Waddell J. It follows from my acceptance of the annuity as proposed by the Court of Appeal that I accept the reasons expressed by Hutley J.A. for not confining the payment of the annuity to the period of the appellant's widowhood. I agree that the changing understanding in the community of the needs of the elderly, and of the respective roles of the sexes, make it inappropriate in the circumstances of the present case to retain the provision as contained in the will. (at p460)

22. I would therefore allow the appeal, and dismiss the cross-appeal. The provisions of cl. 6 of the will should be varied to accommodate the provision of a home unit as ordered in cl. 1 (c) of the order of Waddell J. and of an annuity in terms of pars. 2 (a) and (b) in the order of the Court of Appeal. (at p460)

Orders

Appeal allowed with costs.

Cross-appeal dismissed with costs.

Order of the Court of Appeal made on 23rd July 1979 varied by substituting for Order 2 of that Order a paragraph reading as follows: "2. In lieu of the provisions made by the Will of the deceased for the Plaintiff Muriel Frances White there be provided out of the estate of the deceased for the said Plaintiff benefits payable under clause 6 of the Will as though sub-clauses (a) and (b) of the said clause were as follows:
(a) (i) If my wife the said MURIEL FRANCES WHITE shall survive me to set aside and invest in the names of my trustees in any investments authorised by law for the investment of trust funds or in debentures or debenture stock of any public company in the Commonwealth of Australia $80,000.00 (hereinafter called 'my Trust Fund') to pay to my said wife in the year after my death five thousand two hundred dollars ($5,200.00) per annum and I further direct that thereafter during her life such sum be varied on each anniversary of my death so that it becomes a sum which bears the same relation to the said sum of five thousand two hundred dollars as the consumer price index for the weighted average of six State capital cities for all groups or such index as has been substituted for it issued by the Commonwealth Statistician current at the date of each anniversary bears to the said index at my death and that each such annual sum be paid to her weekly and I further direct that the said annuity as varied by paid firstly out of the income of my Trust Fund, secondly out of my accumulation of the Income of the said Fund and thirdly out of the capital of the said Fund.
(ii) Upon the death of my said wife to divide between my son the said Richard Todd White and my daughter the said Judith Martin the balance of my Trust Fund in equal shares.
(b) The trustees shall spend a sum not exceeding $65,000.00 in the purchase of a home unit selected by the said Plaintiff which she may live in or let as long as she wishes, she keeping the unit in good repair and insured in a manner approved by the trustees and paying all rates, taxes, levies and expenses in respect of the unit, and after her death the home unit shall be sold by the trustees and the proceeds divided equally between the Plaintiff Judith Martin and Richard Todd White.

Costs of the appeal of the respondents as between solicitor and client to be paid out of the estate.