Woollard v Woollard
[2016] VCC 1999
•22 December 2016
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE COMMON LAW DIVISION | Revised Not Restricted Suitable for Publication |
| FAMILY PROPERTY LIST |
Case No. CI-15-04997
IN THE MATTER of Part IV of the Administration and Probate Act 1958
and
IN THE MATTER of the Will and Estate of PATRICIA JEAN WOOLLARD (deceased)
| ANTHONY JOHN WOOLLARD | Plaintiff |
| v | |
| PETER BRYAN WOOLLARD (who is sued as executor of the Will and Estate of the above-named deceased) | Defendant |
-AND-
Case No. CI-15-05850
IN THE MATTER of Part IV of the Administration and Probate Act 1958
and
IN THE MATTER of the Will and Estate of BRYAN ARTHUR WOOLLARD (deceased)
| ANTHONY JOHN WOOLLARD | Plaintiff |
| v | |
| PETER BRYAN WOOLLARD (who is sued as executor of the Will and Estate of the above-named deceased) | Defendant |
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JUDGE: | HER HONOUR JUDGE KINGS | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 29 and 30 November 2016 | |
DATE OF JUDGMENT: | 22 December 2016 | |
CASE MAY BE CITED AS: | Woollard v Woollard | |
MEDIUM NEUTRAL CITATION: | [2016] VCC 1999 | |
REASONS FOR JUDGMENT
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Subject: TESTATOR’S FAMILY MAINTENANCE
Catchwords: Application under Pt IV of the Administration and Probate Act 1958 – deceased mother and father survived by two adult sons and two adult daughters – claim by the plaintiff son of the deceased for further provision out of the estates for his proper maintenance and support
Legislation Cited: Administration and Probate Act 1958, Part IV; Justice Legislation Amendment (Succession and Surrogacy) Act 2014 (Vic)
Cases Cited:Grey v Harrison (1997) 2 VR 359; Briggs v Mantz [2014] VSC 281; Collicoat & Ors v McMillan & Anor [1999] 3 VR 803; Blair v Blair (2004) 10 VR 69; Forsyth v Sinclair [2010] VSCA 147; Feehan v Toomey [2014] VSC 488; MacEwan Shaw v Shaw (2003) 11 VR 95; Lee v Hearn (2005) 11 VR 270; Walsh v Walsh [2013] NSWSC 1065; Taylor v Farrugia [2009] NSWSC 801; Warriner v McManus [2015] VSC 314; Baulch v State Trustees Ltd [2008] VSC 22; Coates v National Trustees Executors & Agency Co Ltd (1956) 95 CLR 494; Barnaby v Berry [2001] NSWCA 454; McCann v Ward and Burgess [2012] VSC 63; Carroll v Cowburn [2003] NSWSC 248; Brimelow v Alampi [2016] VSC 135; McKenzie v Topp [2004] VSC 90; Worladge v Doddridge (1957) 97 CLR 1
Judgment: Order that further provision be made for the plaintiff in the amount of $79,500.00.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr J Smith | Slater & Gordon |
| For the Defendant | Mr S McNab | Gauld & Co |
HER HONOUR:
Background
1 These proceedings relate to the estates of Patricia Jean Woollard (“deceased mother”) who died on 27 October 2014 and Bryan Arthur Woollard (“deceased father”) who died on 22 February 2015.
2 The deceased mother and the deceased father were survived by four adult children, which are Anthony John Woollard (“the plaintiff”), born on 13 February 1957, Peter Bryan Woollard (“the defendant”), born on 29 November 1953, Rosemary Anne Vastbinder, born on 11 October 1955 and Christine Mary Murphy, born on 5 March 1950.
3 By her Will dated 12 March 2013, the deceased mother appointed the defendant and Ms Murphy as executors of her Will and trustees of her estate. Probate was granted to the defendant on 22 April 2015.[1]
[1]Joint Court Book (“JCB”) 12
4 By her last Will, the deceased mother left her estate as follows:
· the sum of $125,000 to the defendant in acknowledgement of his financial support to the deceased during her lifetime;
· the sum of $500 and her 1980 Volvo motor vehicle to the plaintiff; and
· the residue of her estate divided equally between the defendant, Ms Vastbinder and Ms Murphy.[2]
[2]JCB13-18
5 By the deceased father’s Will dated 15 February 2013, he appointed the defendant and Ms Murphy as the executors of his Will and trustees of his estate. Probate was granted to the defendant on 11 June 2015.[3]
[3]JCB 23
6 By his last Will, the deceased father left his estate on mirror terms to his wife as outlined in paragraph 4. However, clause 6 acknowledged this was except where it would result in a duplication of gifts if the beneficiaries had received the identical gift under the deceased mother’s Will.[4] Essentially, the deceased father left his estate to be divided equally between the defendant, Ms Vastbinder and Ms Murphy; and he made no provision for the plaintiff.
[4]JCB 24-28
7 Both the deceased father and deceased mother stated the following in clause 6(3) of their mirror Wills:
“to give to my son the said ANTHONY JOHN WOOLLARD the sum of FIVE HUNDRED DOLLARS ($500.00) and I DECLARE that I make no further provision for him as I have already made adequate provision for him during my lifetime.”[5]
[5]JCB 15, 24
8 In the defendant’s affidavit sworn 25 November 2016, he deposed that the assets and liabilities of the estates as at 1 November 2016 were as follows:
· the sum of $395,922.71 in a Commonwealth Bank account on behalf of the estate of the deceased father;
· the sum of $258,886.14 in a Commonwealth Bank account on behalf of the estate of the deceased mother; and
· a future small and unknown taxation refund for both estates for the year ended 30 June 2015. [6]
[6]JCB 128-129
9 The two estates total $654,808.85 without factoring in the small taxation refund or legal costs incurred by both parties. Essentially, together, the deceased mother and deceased father left their children the following in their Wills:
· To the plaintiff, the sum of $500 and a 1980 Volvo motor vehicle;
· To the defendant, the sum of $125,000 and an equal share of the residuary estates in the sum of $176,436.28;
· To Ms Vastbinder, an equal share of the residuary estates in the sum of $176,436.28; and
· To Ms Murphy, an equal share of the residuary estates in the sum of $176,436.28.
10 By Originating Motions filed on 22 October 2015, the plaintiff applies for further provision out of the estates of his deceased mother and deceased father for his proper maintenance and support pursuant to the Administration and Probate Act 1958 (Vic) (“the Act”).
The evidence
11 The plaintiff relied upon two affidavits sworn on 6 May 2016 and 28 November 2016. The plaintiff was cross-examined in Court. In my view, the plaintiff was disorganised in his financial affairs, which I will address later in my reasons. I formed the view that the plaintiff was a truthful witness. He answered questions directly and made concessions.
12 The defendant relied upon several affidavits, which are:
· The affidavit of the defendant sworn on 23 June 2016 and the two affidavits sworn on 25 November 2016;
· An affidavit of Ms Vastbinder sworn on 24 November 2016; and
· An affidavit of Ms Murphy sworn on 24 November 2016.
13 The defendant, Ms Vastbinder and Ms Murphy were cross-examined in Court. In my view, these witnesses answered questions directly, made appropriate concessions and impressed me as hardworking individuals. To their credit, the three siblings were very respectful towards the plaintiff.
14 Much of the facts were not in dispute.
15 In 1949, the deceased mother and deceased father were married. All of the evidence was that they had a long and happy marriage. The defendant and Ms Vastbinder said that they had a close and loving family and their parents treated and loved their four children equally.[7] The plaintiff’s evidence is that his deceased father worked as a city treasurer to provide for his family.[8]
[7]Transcript (“T”) 76, Line (“L”) 11-14; T107, L23-30
[8]JCB 6
16 The deceased mother and father had four children in the 1950s. On 13 February 1957, the plaintiff was born with spina bifida and underwent major surgery to fuse spinal discs at six months of age. The evidence before me was that he was subsequently unaffected by his birth condition.
17 After completing secondary education, he worked in an architect’s office whilst studying at RMIT University at night. In 1987, he graduated with a Diploma of Architecture. The plaintiff said that he lived at home until twenty-five or twenty-six years old and paid weekly board when he commenced full-time work as a self-employed builder. He said that his parents were very proud of his career endeavours and achievements.[9]
[9]JCB 6
18 In the early 1990s, the plaintiff had two children, Hailey and Jake, with Ms Sherrie Moule. In 1993, he married the mother of his children, Ms Moule.
19 In May 1990, the plaintiff purchased a one-third share of a hotel business, the Station Tavern in Prahran (“the Tavern”). Subsequently, the plaintiff sought to purchase a second one-third share of the Tavern but did not have the funds. The plaintiff gave evidence that the deceased mother and deceased father offered financial assistance in the form of a guarantee on the plaintiff’s loan of $150,000 from the National Australia Bank (“the loan”).[10] In cross-examination, he said he did not ask his parents for the guarantee but also acknowledged that he did not provide them any financial advice.[11] He assumed that they obtained advice from the defendant, who was a financial planner.[12] However, the plaintiff did agree with counsel for the defendant that, to a very real extent, the financial risk of the venture was on his parents and not him.[13] The defendant said that his father suffered from anxiety. He said that his parents told him it was “pretty failsafe” and that there was little chance that anything would go wrong.[14]
[10]JCB 6-7
[11]T27-28
[12]T27
[13]T27, L28
[14]T69, L2
20 The Tavern went into receivership in April 1991 and the National Australia Bank subsequently sought to call up the loan and enforce the guarantee. The plaintiff could not repay the loan. The deceased mother and father did not have all of the money required to re-pay the loan that they had guaranteed without the sale of their home.[15]
[15]JCB 7
21 All parties agree that monies were paid to the National Australia Bank to discharge the loan, which totalled $161,400.00 and were in the following amounts:
· $4,500 paid by the plaintiff;
· $10,000 paid by Ms Vastbinder;
· $31,523 paid by the deceased mother and deceased father; and
· $105,377 paid by the defendant.
22 The defendant said that he felt he had no other option other than to use money from the sale of his business and incur substantial tax on it in order to pay the bank to ensure his parents did not lose their home.[16] Both parties acknowledge that the deceased mother and deceased father left the $125,000 legacy to the defendant in each of their Wills in order to recognise his contribution, plus interest, in the repayment of the loan to the bank.
[16]T70; the defendant explained that it was his original intention to place proceeds from the sale of his business into his superannuation fund.
23 Despite the collapse of the Tavern, the defendant confirmed in Court that the plaintiff maintained a close relationship with his deceased mother and deceased father and there was no animosity harboured as a result.[17] He continued to be invited to and attend family gatherings.[18]
[17]T71, L24-28,
[18]T103, L15-20
24 The plaintiff deposed that this failed venture caused his bankruptcy.[19] In 1993, the plaintiff was declared bankrupt and was discharged on 19 June 1996.
[19]JCB 37
25 From 2001, the plaintiff was the sole director and sole shareholder in Multigroup Investments Pty Ltd (“Multigroup”) and, from 2002, Jigsaw Group Ltd (“Jigsaw”). In 2002, Multigroup purchased 18 Brown Street, Lilydale.
26 In August 2005, the plaintiff and Ms Moule became joint registered proprietors of 5 and 7 Taurus Court, Lilydale, which were subject to mortgages. In 2005, Ms Moule and the plaintiff separated and the plaintiff became the sole carer of his two children. As part of his matrimonial settlement, upon payment of $80,000 to Ms Moule, he became the sole registered proprietor of 5 and 7 Taurus Court, Lilydale in March 2009. He uses the former property as his home and rents out the latter property to tenants.
27 Both parties agree that, during their lifetime, the deceased mother and deceased father gave the plaintiff $6,000 in around 2008 and $8,400 to pay off the plaintiff’s credit card debt in 2010.[20] The plaintiff disputes receiving any other benefit from his parents. The defendant deposed that records show that the deceased father and deceased mother also gave other money to the plaintiff, which included:
[20]JCB117
· A deposit in the sum of $2,400 into the Jigsaw account, which the plaintiff controlled;
· A payment of two years’ tuition fees to the plaintiff for the plaintiff’s son, Jake, to attend Mount Lilydale College;
· A sum of $6,000 in unexplained bank transfers to the plaintiff; and
· A payment for an extra 4,000 bricks for the plaintiff to complete one of his building projects.[21] In Court, Ms Vastbinder stated she thought the bricks would have cost around $2,000[22] and the defendant could not say whether it was less than $1,000,[23] as asserted by the plaintiff in his affidavit.[24]
[21]JCB 117
[22]T103, L10
[23]T84, L3-5
[24]JCB 41
28 In 2010, the plaintiff’s second failed business venture saw him deposit $280,000 into a Hong Kong account to raise finance for a business retail property venture in Melbourne. The plaintiff said he was unable to retrieve the money and the full amount was lost.[25]
[25]JCB 38
29 In June 2011, the plaintiff became a contractor with Spinners Operations (Vic) Pty Ltd until it went into receivership in around November 2012. He estimates receiving a gross sum of $148,000 during this period of employment.[26]
[26]JCB 38
30 The plaintiff’s evidence is that he was in the care of a psychologist from May 2010 to June 2012.[27] He deposed that he was suffering with severe depression, anxiety and had thoughts about taking his own life.[28]
[27]JCB 8
[28]JCB 8
31 In January 2012, the deceased mother and deceased father moved into aged care accommodation after their home was sold in around March 2012.[29] In the same year, the plaintiff was involved in a building dispute at VCAT. On 20 December 2012, the Tribunal found that the plaintiff was under a disability and appointed an administrator for the purposes of conducting the litigation.[30] Ultimately, the administrator settled the claim and the plaintiff was required to pay $100,000 to the applicant and $36,000 in legal fees.
[29]T72, L13
[30]JCB 47
32 In August 2013, the plaintiff, through Multigroup, subdivided 18 Brown Street, Lilydale into two separate lots and subsequently sold them. In September 2013, he sold the first lot and the $55,000 in net proceeds were paid to the applicant in the VCAT proceeding. In June 2014, the second lot was sold and the $135,000 in net proceeds were paid as the outstanding amount owed to the applicant in the VCAT proceeding and the remaining $88,500 was paid to Ms Vastbinder to repay a debt he owed to her family.[31]
[31]JCB 39
33 The plaintiff deposed that the debt owed to Ms Vastbinder and her family arose because he borrowed money and owed wages to Ms Vastbinder’s sons for work they had performed for the plaintiff’s business. Ms Vastbinder said that the $88,500 settled the debt and any legal claim she had against the plaintiff.[32]
[32]T110, L17
34 The plaintiff said that he was not working from between 1 August 2014 until 16 March 2015.
35 As to the plaintiff’s financial circumstances, he acknowledged that he had not filed taxation returns for his personal earnings and also the Jigsaw Group since the 2007-2008 financial year.[33] He did not provide an adequate reason for his failure to do so. The plaintiff said he has not yet been provided with advice from his accountant as to the total amount of his taxation liabilities.
[33]JCB 39; T25, L1
36 Further, he acknowledged that his personal and business finances were mixed in the company bank account, Jigsaw Group. For the purposes of the trial and complying with his taxation obligations, the plaintiff prepared a statement of income and expenses of the Jigsaw Group by looking at bank accounts, bank statements and invoices.[34] He agreed he took money from the account to meet personal expenses when needed but could not provide me with a figure as to personal expenses per year.[35] The statement did not assist me to easily distinguish his personal and business finances.[36] He told me he will shortly lodge the statement with his accountant in order to file and complete outstanding taxation returns.[37]
[34]T46; Exhibit A
[35]T54
[36]T25
[37]T10; T35, L27; JCB 39
37 Currently, the plaintiff said that he suffers back pain, a bowed back and a limp, which affects his ability to work. He no longer takes medication for anxiety and depression. He currently earns between $30,000 to $35,000 per year working as a builder but questions whether he can maintain this physical work. He also receives $350 per week in cash as rent from his rental property, struggles to meet mortgage repayments on both of his properties and has his daughter live with him.
Submissions of the parties
38 In written submissions, counsel for the plaintiff submitted that:
· the deceased mother and deceased father owed a weighty moral obligation to their son, the plaintiff, whose relationship with them was close, loving and untainted by rancour
· the plaintiff finds himself on the cusp of his seventh decade with substantial debt, no net savings and no superannuation
· the plaintiff’s siblings, the defendant and Rosemary; have no financial needs and any further provision from the plaintiff would be of no consequence to them; and
· the plaintiff’s other sibling, Christine, is less wealthy but with assets that makes her far better off than the plaintiff.
39 The plaintiff asserts that the Court should award him $130,000 from the deceased father’s estate and $70,000 from the deceased mother’s estate for his proper maintenance and support. In written submissions, Counsel for the plaintiff asserted that the plaintiff does not seek to disturb the legacy of $125,000 payable to the defendant.
40 In written submissions, counsel for the defendant submitted that:
· adequate provision was made for the plaintiff during his parent’s lifetime in the form of the guarantee on the loan and payments to the plaintiff, which was recognised in both of their Wills
· the financial position and earning capacity of the plaintiff is obscure and may not be as dire as the plaintiff made out; and
· whilst the plaintiff is not as well off as his siblings, in the circumstances, the plaintiff appears to be managing well on his current resources.
41 Counsel for the defendant submitted that what was paramount was the freedom of testation, whereby the plaintiff’s parents sought not to make further provision for him due to the previous benefits he had received in their lifetime.[38]
[38]Grey v Harrison (1997) 2 VR 359 at 364-365
Legislative framework
42 The plaintiff seeks further provision from the estate of the deceased mother and the deceased father in accordance with s91 of the Administration and Probate Act 1958 (Vic) (“the Act”).
43 By reason of the dates of death, the two claims are dealt with pursuant to different legislation. The deceased mother’s estate is dealt with in accordance with the scheme before it was amended by the Justice Legislation Amendment (Succession and Surrogacy) Act 2014 (Vic) and the deceased father’s estate is dealt with in accordance with the current scheme, as amended.
(a) The deceased mother
44 In any application for further provision pursuant to s91 of the Act, the Court must determine three questions:
· First, whether the deceased had a responsibility to make provision for the proper maintenance and support of the plaintiff at the date of death;
· Second, if so, whether the deceased, in the distribution of the estate, made adequate provision for the proper maintenance and support of the plaintiff; and
· Third, the amount of the provision (if any) that the Court should order.
45 There is a significant overlap in the considerations referable to each stage of the process.
46 In Briggs v Mantz,[39] McMillan J summarised the relevant principles of law, where she said that, in considering the three questions:
[39][2014] VSC 281 (McMillan J); see also Collicoat & Ors v McMillan & Anor [1999] 3 VR 803 at 818 (Ormiston J), Blair v Blair (2004) 10 VR 69 at 77-80 (Chernov JA); Forsyth v Sinclair [2010] VSCA 147, at paragraph [61] (Neave JA), Feehan v Toomey [2014] VSC 488 at paragraphs [17]-[18] (McMillan J)
“[95]…
(a) the court must have regard to the matters set out in ss 91(4)(e)–(p);
(b) the court must determine whether the deceased had a moral duty, responsibility or obligation to the applicant;
(c) keeping in mind the weight given to the freedom of testation, the court will only interfere if the testator has failed in his or her moral duty; and
(d) that moral duty reflects an obligation to make adequate or sufficient provision by what is right and proper according to community standards.
[96]The basis of the court’s jurisdiction is responsibility, traditionally described as the enforcement of moral obligations. The question is what a wise and just testator would have thought it his moral duty to make for the plaintiff. … .”[40]
[40]Paragraphs [94]-[95] – footnotes omitted
(b) The deceased father
47 The plaintiff makes a claim on his deceased father’s estate pursuant to s91(2) of the Act. There are three questions to be determined, whereby the Court cannot make a family provision order unless it is satisfied that:
· the person is an “eligible person”;
· that, at the time of the deceased’s death, the deceased had a moral duty to provide for the eligible person’s proper maintenance and support; and
· that the distribution of the deceased’s estate fails to make adequate provision for the proper maintenance and support of the eligible person.
48 In making its determination, the Court must take into account the factors outlined in s91A(1), which are:
· the deceased’s Will;
· any evidence of the deceased’s reasons for making the dispositions in the deceased’s Will; and
· any other evidence of the deceased’s intentions in relation to providing for an eligible person.
49 Similarly, the Court may take into account the following factors outlined in s91A(2), which are in essence the same as the pre-amendment legislation.[41] The new Act adds an additional factor, which is that the Court must consider “the effects a family provision order would have on the amounts received from the deceased’s estate by other beneficiaries”.
[41]in s91(4)(e) to (p) of the Act
50 As to the quantum, the Court must take into account the factors outlined in section 91(4)(a)-(d). The amount must not provide for an amount greater than is necessary for the eligible person’s proper maintenance and support.[42]
[42]Section 91(5) of the new Act
Application of legal principles
51 The parties did not separately deal with the estates of the deceased mother and father except for in written submissions. I intend to address the estates separately and avoid, insofar as possible, unnecessary repetition.
(a) Deceased mother
First, whether the deceased had a responsibility to make provision for the proper maintenance and support of the Plaintiff at the time of death
52 The authorities have established that whether or not the deceased had a responsibility to make provision for a person, the Court must be satisfied that there was a moral duty to do so and that the testator ought to have given provision as a just and wise testator.[43]
[43]MacEwan Shaw v Shaw (2003) 11 VR 95
53 In Blair v Blair,[44] Chernov JA, said:
“… it is probably apt to describe the obligation of the testator that forms the subject of the inquiry under subss (1) and (3) as a moral obligation, as that concept has been explained in cases that preceded the recent amendments to Pt IV of the Act, including the decision of Ormiston J in Collicoat v McMillan[45] and Grey v Harrison.[46] Thus, it is clear enough that the ‘responsibility’ of which subs (1) speaks is the moral duty or obligation of the testator to make provision for the proper maintenance and support of the claimant. Similarly, subs (3) is essentially concerned with whether the deceased — as a wise and just testator — has fulfilled his moral obligation to make adequate provision for the claimant’s proper maintenance and support. Given, however, that the court is now directed by the legislation to have regard to the matters specified in paras (e)–(p) of s 91(4) when determining the jurisdictional issues, characterisation of the deceased’s relevant obligation by reference to moral duty is likely to be of less utility than was the case prior to the recent amendments to Pt IV of the Act. … .”
[44](Supra) at paragraph [13]
[45][1999] 3 VR 803
[46][1997] 2 VR 359
54 In agreement with Chernov JA, Nettle JA said,[47] regarding the concept of moral duty and the jurisdictional questions posed by s91(1) and (3):
“… To reason from the matters mentioned in s 91(4)(e)–(p) to a conclusion that a testator had a responsibility to make provision for a claimant, or that the testator failed to make adequate provision for the claimant, necessitates the application of a test or standard to the matters to be considered. That test remains one of whether and if so what provision a wise and just testator would have thought it his moral duty to make in the interests of the claimant.”
[47]At paragraph [41]. These observations were referred to with approval in Lee v Hearn (2005) 11 VR 270 at paragraph [4] per Callaway JA, in whose judgment Batt and Buchanan JJA agreed
55 In Lee v Hearn,[48] Callaway JA said that “responsibility” to make provision meant a legal or moral responsibility, according to the sense in which “moral” has been explained in the authorities.[49] In this sense, “it is not a static or idiosyncratic concept”.[50] He used the words “what a wise and just testator would consider his or her moral duty”[51] to do, and said that this may change with time or in response to community standards.
[48]Supra
[49]At paragraph [5]
[50]At paragraph [8]
[51]At paragraph [8]
56 Ormiston J, as he then was, in Collicoat & Ors v McMillan & Anor,[52] discussed the concept of “moral duty” and “moral obligation”.[53] At paragraph [43], he said:
“In my opinion the expression ‘moral claim’ has always been treated as a convenient shorthand expression referring to the right correlative to the duty imposed on testators to make adequate provision for the proper maintenance and support of persons within the class specified. That ‘moral obligation’, as described in Re Allen [Re Allen; Allen v Manchester [1922] NZLR 218] and many later cases, reflects a duty resting on a testator to make not merely adequate or sufficient financial provision for members of his or her family in the specified class but also the obligation to measure that adequacy or sufficiency by reference to what is right and proper according to accepted community standards.”
[52]Supra
[53]At paragraphs [36]-[47]
57 Counsel for the plaintiff referred me to the case of Walsh v Walsh,[54] where Hallen J summarised a number of general principles concerning claims made by adult children at paragraphs [121] to [126]. In particular, the following is useful:
[54][2013] NSWSC 1065
“(a) The relationship between parent and child changes when the child leaves home. However, a child does not cease to be a natural recipient of parental ties, affection or support, as the bonds of childhood are relaxed;
…
(c) Generally, also, the community does not expect a parent to look after his, or her, child for the rest of the child’s life and into retirement, especially when there is someone else, such as a spouse, who has a primary obligation to do so … But where a child, even an adult child, falls on hard times, and where there are assets available, then the community may expect a parent to provide a buffer against contingencies; and where a child has been unable to accumulate superannuation or make other provision for their retirement, something to assist in retirement where otherwise, they would be left destitute: Taylor v Farrugia at 58.
…
(e) There is no need for an applicant adult child to show some special need or some special claim: McCosker v McCosker; Kleinig v Neal (No 2) at 545; Bondelmonte v Blanckensee [1989] WAR 305; and Hawkins v Prestage (1989) 1 WAR 37 per Nicholson J at 45.
(f) The adult child’s lack of reserves to meet demands, particularly of ill health, which become more likely with advancing years, is a relevant consideration: MacGregor v MacGregor [2003] WASC 169 (28 August 2003) at [179] – [182]; Crossman v Riedel [2004] ACTSC 127 at [49]. Likewise, the need for financial security and a fund to protect against the ordinary vicissitudes of life, is relevant: Marks v Marks [2003] WASCA 297 at [43]. In addition, if the applicant is unable to earn, or has a limited means of earning, an income, this could give rise to an increased call on the estate of the deceased: Christie v Manera [2006] WASC 287; Butcher v Craig [2009] WASC 164 at [17].
(g) The applicant has the onus of satisfying the Court, on the balance of probabilities, of the justification for the claim: Hughes v National Trustees; Executors and Agency Co of Australasia Ltd, at 149.
…
(i)There is no obligation on a parent to equalise distributions made to his, or her, children so that each child receive benefits on the same scale as the other: Cooper v Dungan at 542. There is no standard measure for the extent of the duty owed by a parent to a child.”
58 Counsel for the plaintiff relies upon the above passage from Taylor v Farrugia[55] that is cited with approval by Hallen J in order to submit that the plaintiff is an adult child who has fallen on “hard times” with debt, no savings and no superannuation and, as such, a moral duty arises so that a parent should have made provision in their estate to provide for his retirement or otherwise.
[55][2009] NSWSC 801
59 In written submissions, counsel for the defendant also directed me to the same passage from Taylor v Farrugia reiterated by Hallen J to submit that the community does not expect the deceased mother and deceased father to provide for their adult son for the rest of his life and into retirement and thus the Court’s starting point should be that the plaintiff is capable of providing for himself. Counsel did not address me as to the position when an adult child falls upon hard times. Counsel for the defendant also submitted that the plaintiff had not established circumstances that gave rise to a moral obligation justifying further provision for the plaintiff and that there is no obligation on a testator to treat all his or her children equally.[56]
[56]Warriner v McManus [2015] VSC 314
60 Typically, the courts have recognised that adult children have a powerful claim on the bounty of their parents, in that the relationship of a child and parent “carries with it a well-recognised obligation”.[57]
[57]See Baulch v State Trustees Ltd [2008] VSC 22 (Pagone J); see also Coates v National Trustees Executors & Agency Co Ltd (1956) 95 CLR 494 and Barnaby v Berry [2001] NSWCA 454
61 I will now turn to the specific matters that I am required to have regard to under s91(4)(e) to (p) of the Act.
Section 91(4)(e) – Family or other relationship
62 The plaintiff was born and raised by his deceased mother and deceased father. He lived at home until his mid-20s and thereafter maintained a relationship with his mother. All witnesses acknowledged that, notwithstanding the failure of the Tavern and the financial impact on the deceased mother, the plaintiff and the deceased mother had a loving and enduring relationship until she died. This factor weighs in favour of the deceased’s moral duty to her son.
Section 91(4)(f) – Any obligations or responsibilities of the deceased to the applicant or others
63 The plaintiff, defendant, Ms Murphy and Ms Vastbinder are siblings and were the children of the deceased mother.
64 Counsel for the plaintiff asserted that the deceased mother had parental obligations or responsibilities, which extended to the plaintiff and all of the three beneficiaries. However, counsel for the defendant asserted that this obligation was greater to the three beneficiaries, other than the plaintiff, due to the plaintiff receiving his share of the wealth during the deceased mother’s lifetime.
65 I accept that the deceased mother had obligations or responsibilities to all of her children that arose as being a parent.
Section 91(4)(g) – The size and nature of the estate
66 Having regard to the assets and liabilities of the deceased mother’s estate, the net asset position of the estate is small, being $258,886.14, which does not include any legal costs incurred.
67 Counsel for the plaintiff described it as a “modest” estate, which was enough to make further provision for the plaintiff. In my view, it is a very small estate given that the legal costs are not yet deducted from this amount and that there are four competing claims on the estate.
Section 91(4)(h) – The financial resources (including earning capacity) and the financial needs of the applicant, of any other applicant and of any beneficiary of the estate at the time of hearing and for the foreseeable future
(a) The Plaintiff
68 The exact nature of the plaintiff’s financial position was the subject of much dispute between the parties given the plaintiff had not unravelled his business and personal affairs or complied with his taxation obligations from 2007-2008.
69 Counsel for the plaintiff attempted to clarify the plaintiff’s financial circumstances at trial. In summary, they are as follows;
· sole registered proprietor of 5 Taurus Court, Lilydale, which is his residence and has a capital improved value of $490,000;
· sole registered proprietor of 7 Taurus Court, Lilydale, which has a capital improved value of $400,000;
· bank account balance of Jigsaw is currently $51,168;
· no superannuation or shares;
· liabilities that amount to $563,195 in the form of two mortgages over the two properties with Westpac Bank and rates owed on both properties;
· unascertained taxation liabilities, as he has not filed personal or company taxation returns since the 2007-2008 financial year;
· two motor vehicles, a station wagon used solely for building works and a four-wheel drive with a towbar also used in his business, which he valued at about $7,000. He also has an unregistered Volkswagen 1970 beetle that he valued at $6,000;
· work tools;
· Michael Shannon artwork, which the plaintiff estimated to be valued at between $20,000 to $30,000;[58]
[58]T37, L7
· rental income of $350 per week from 7 Taurus Court, Lilydale, his rental property;[59] and
· earnings of $30,000 to $35,000 per annum as a self-employed builder.
[59]JCB 39
70 The plaintiff gave evidence that he was limited in his work hours due to his back pain and that he had little work scheduled for 2017. However, he described his work as 40 per cent supervising and 60 per cent physical work.[60] The supervising work involved monitoring other trades like an electrician, plumber or plasterer.[61] He deposed that he struggles to meet his combined mortgage repayments of approximately $3,000 per month.[62]
[60]T33, L30
[61]T45
[62]JCB 40
71 In cross-examination, he acknowledged going on three overseas holidays, purchasing cars for his two children, albeit with a loan, and purchasing and flying two dogs from Queensland to Melbourne at a cost of $430 in total.[63]
[63]T37, L18 – T38, L3
72 As aforementioned, the plaintiff’s personal and business finances are mixed in the company bank account, Jigsaw Group. The statement the plaintiff prepared does not assist me to easily distinguish his personal and business finances.[64] He agreed that any personal expenses would come from the company account, including food, clothes and a small wage per week that was not fixed. The plaintiff agreed with counsel for the defendant that he just took money from the company bank account to meet personal expenses as and when they were needed.[65] The plaintiff could not provide me with a figure as to his personal or domestic expenses per financial year.[66] He said that the statement showed a normal or routine year apart from the travel he undertook in that relevant year.[67] I was informed that the mortgage repayments were paid by Jigsaw. I was also informed that the rental income from 7 Taurus Court, Lilydale was used to cover the plaintiff’s personal expenditure.
[64]T25
[65]T50 L5
[66]T54
[67]T60
73 Although he has prepared documents for his accountant in order to complete outstanding taxation returns, the document is vague, imprecise and unhelpful. There were no ledgers or spreadsheets kept to be produced in Court to assist me to identify his personal financial state. I am not impressed with his failure to lodge taxation returns and understand that his accountant has not yet assessed his outstanding taxation liabilities to the Australian Taxation Office.
74 Counsel for the plaintiff said that, whilst the plaintiff’s finances lacked certainty, if the plaintiff were to sell his investment property, he would still have significant liabilities. It was accepted by the defendant that the plaintiff has no savings, no superannuation and no other security to see him into the future.
75 Whilst it is extremely difficult for me to be satisfied as to the true extent of the plaintiff’s financial position, I accept that the plaintiff is in a poor financial state.
(b) The Defendant
76 Both parties were in agreement that the defendant was in a better financial position than the plaintiff. His finances were outlined as follows:
· joint proprietor with his wife of his unencumbered home with a capital improved rate value of $620,000;[68]
[68]Exhibit 1
· joint superannuation with his wife of $829,000;
· cash in his business accounts of $720,000; and
· two motor vehicles owed by his business, which were roughly worth about $5,000 and $20,000 each.
77 At trial, the defendant gave evidence that he was currently in between working and retirement since the sale of his business.[69] His wife has not worked since their daughter was born in 1998 except for on a casual basis for his business.[70] He said that together they earned $150,000 gross in the 2016 financial year, which was $100,000 for him and $50,000 for his wife.[71]
[69]T66-67
[70]T74
[71]T94
78 In cross-examination, the defendant told the Court that he recently sold the assets of PB Woollard & Associates, his financial planning business, for the sum of $865,892. He received the first instalment, which was 80 per cent of the purchase price, in November 2016.[72] I understand that the second instalment from the purchaser may be received in twelve months, subject to clause 8 of the contract, which allows the sum to be reduced if the purchaser lost clients in the first year of operation.[73] The defendant said this second amount is about $180,000 or thereabouts.[74] However, he said that he “knew that’s not going to happen because we have already lost some clients”.[75] I accept that the defendant’s receipt of the second instalment at about $180,000 under the contract is unlikely. I accept that a sum less than $180,000 will be received, although the amount is unknown at this stage. Counsel for the plaintiff submitted two thirds of this amount is the likely future payment. For the purposes of this proceeding, I adopt a figure of 50 per cent, that is, $90,000 as the second instalment sum.
[72]T85, L22-23
[73]Exhibit 1
[74]T86, L6-7
[75]T75, L15-16
79 The defendant also gave evidence as to the money he paid to assist in clearing the loan to the bank that the plaintiff was unable to repay. Counsel for the defendant asked him as to that financial impact:
Q:“Were there other consequences to you finding that money?---
A:Yes, I paid an awful lot of tax because otherwise I would have been able to put into my – let me go back a step. I was involved in the sale of a business, this was some of the payments that were coming to me. I had hoped to roll it into our super fund. I had to pay the tax and pay off the loan, so it probably cost me – well, 50 per cent tax rate was what I was paying at the time.
Q:So in very rough money terms, how much would that have been?---
A:Look, it could have been another $80,000, maybe up to 100. I’m not 100 per cent. I don’t have those tax records now.”[76]
[76]T70, L1-13
80 In cross-examination, the defendant said that the $80,000 included the tax liability if he had put that money into his superfund instead.[77]
[77]T80-81
81 I accept that the defendant would have been in a much better financial position had he not had to contribute his own money to pay off the plaintiff’s loan.
82 Ultimately, the defendant’s joint financial resources will stand at $1,639,000, not including the $125,000 plus the residuary of the estate he can expect from the estate of his deceased mother. The defendant told the Court that, from his experience as a financial planner, he would expect his capital to decline substantially over a period of time.[78]
[78]T93
83 I disagree with counsel for the plaintiff’s submission that the defendant is “extremely comfortable”[79] but I accept that he is in a good financial position.
[79]T89, L29
(c) Christine Murphy
84 Ms Murphy’s financial position was set out in her affidavit material as follows:
· joint proprietor of her family home in Donvale with her husband, which has a capital improved rate value of $720,000;[80]
[80]Exhibit 2
· joint savings and shares that amount to approximately $50,000;
· joint superannuation in the amount of approximately $405,000; and
· joint income of about $1,760 per fortnight, which is a combination of an aged pension and superannuation pension.
85 Ms Murphy retired from work as a science laboratory technician due to ill health and was diagnosed with lung cancer in November 2014.[81] Her husband, Robert, was retrenched at fifty years of age and is now on a part pension from Centrelink. Ms Murphy has one son who studies full time and lives at home. Her major asset is the superannuation accumulated by her and her husband.[82]
[81]T95
[82]T96 L18
86 Ultimately, Ms Murphy’s joint financial resources will stand at $455,000.
87 In Court, Ms Murphy told the Court that she has managed with her current resources but the balances were going down.[83] I accept that Ms Murphy’s finances are poor and that she is in a slightly better position than the plaintiff.
[83]T97
(d) Rosemary Vastbinder
88 Ms Vastbinder’s financial position was set out in her affidavit material as follows:
· joint proprietors with her husband of her home in Vermont South with a capital improved rate value of $740,000
· joint proprietors with her husband of investment properties in Cowes, Malvern East and Vermont with a net capital improved rate value of $1,125,000
· three of the four properties are encumbered by mortgages which total $295,541
· joint superannuation assets of $1,338,000
· net joint savings in the amount of $54,000
· total annual household income of $110,000, which comprises of her employment as an emergency teacher one day a week part time, her husband’s earnings as a part-time aged care worker and rental income from the investment properties.[84]
[84]Exhibit 3
89 Ms Vastbinder told the Court that when she and her husband had contemplated retirement, she was told by an expert that she would need approximately $1.8 million for a comfortable retirement.[85] Ultimately, Ms Vastbinder’s joint financial resources will stand at approximately $2,221,459.
[85]T106
90 In Court, she agreed with counsel for the plaintiff that her financial situation was in stark contrast to the plaintiff and that she had more than enough to meet her material needs for the rest of her life.[86] In re-examination, Ms Vastbinder said that she and her husband planned to retire in December 2017.[87]
[86]T121
[87]T123
91 I accept that Ms Vastbinder is in a stronger financial position than her siblings, given the state of her assets as outlined above. I accept that her position is stronger than the plaintiff.
Section 91(4)(i) – Any physical, mental or intellectual disability of any applicant or any beneficiary of the estate
92 The plaintiff gave evidence that he continues to suffer from a spinal condition, depression and anxiety. There was no medical evidence tendered to confirm that he continues to suffer from this spinal condition nor the gravity of the condition, such that it may impact upon his earning capacity. In the plaintiff’s second affidavit, he said he no longer took medication for his depression and anxiety. The defendant told the Court that he was not aware of the plaintiff’s back problems and that he and his deceased father also had back problems.[88]
[88]T82 -83
93 The defendant suffers from high blood pressure, hypothyroxine, arthritis, a bad back and bad knees.[89] He told the Court he takes four types of regular medication and one other non-regular medication.[90] Ms Vastbinder has a respiratory issue, back problems for over twenty years, arthritis, hypothyroidism and right knee issues.[91] Ms Murphy has secondary lung cancer, hypothyroidism, back problems and arthritis. Similarly, there was no medical evidence adduced to confirm that this would impact upon their earning capacities.
[89]T72
[90]T72
[91]T107
94 Counsel for the defendant submitted that only Ms Murphy would be impacted in her ability to work due to her lung cancer. I accept that this is true and take this into account in my assessment. Whilst the plaintiff may suffer from a spinal condition, I cannot be satisfied that the evidence shows that this will affect his future employment as a builder and resulting earning capacity.
Section 91(4)(j) – The age of the applicant
95 The plaintiff is fifty-nine years of age.
Section 91(4)(k) – Any contribution (not for adequate consideration) of the applicant to building up the estate or to the welfare of the deceased or the family of the deceased
96 It was not contested that the plaintiff was anything other than a dutiful son. The plaintiff gave evidence in his affidavit that he made contributions to the estate through maintenance and repair of the deceased mother’s home without payment.[92] Ms Vastbinder told the Court that she also assisted her parents in the latter years of their lives by taking them to appointments, having lunch together and performing household duties such as cooking and cleaning. She also said that either she or Ms Murphy would sometimes stay the night with one parent if the other parent was in hospital to ensure they were never left alone.[93] The defendant told the Court that he took care of his parents’ finances from the time they went into aged care accommodation in January 2012.[94]
[92]JCB7
[93]T104, L15-29
[94]T68, T72
97 I accept that the plaintiff made a relatively minor contribution to the deceased mother’s estate, which I can take into account in my determination of his claim.
Section 91(4)(l) – Any benefits previously given by the deceased person to any applicant or to any beneficiary
98 In summary, evidence was produced in Court that the plaintiff received the following previous benefits from his deceased mother and deceased father during their lifetimes:
· security in the form of a guarantee on the plaintiff’s bank loan to purchase a third share in the Tavern in the form of a guarantee;
· $6,000 in around 2008;
· $8,400 in around 2010 to satisfy credit card debt;[95]
[95]T29, L1
· $2,400 which was transferred to the Jigsaw account;[96]
[96]T83; JCB 117
· Two years’ tuition fees at Mount Lilydale College for Jake, the plaintiff’s son, which was transferred to the Jigsaw account;[97]
[97]JCB 117
· $6,000 in unexplained bank transfers; [98] and
· 4,000 bricks for the plaintiff’s building project, which would be between $1,000 and $2,000 on the evidence before me.[99]
[98]JCB 117
[99]JCB 117
99 The plaintiff disputed receiving the last three items. In Court, he said that he had paid the tuition fees for his son to attend four years at the school[100] and struggled to pay those even two years after his son had left the school.[101]
[100]T29, L7-8
[101]T61
100 Much of the defendant’s case rested upon this factor, that is, these significant benefits that the plaintiff received during the deceased mother’s lifetime removed her moral obligation to provide further for him in her Will. In both mirrors Wills, the deceased mother and father explicitly acknowledged that the plaintiff had received adequate provision during their lifetime.
101 Counsel for the plaintiff acknowledged this was a benefit that should be weighed against the fact it occurred twenty-five years ago.
102 I accept that the plaintiff received a substantial benefit in the form of his deceased mother and deceased father’s guarantee of his loan with the bank, which was at great financial risk to them. However, this must be weighed against the fact it occurred twenty-five years ago. The cash payments and assistance with building materials was minimal. I take this factor into account when assessing the plaintiff’s claim for further provision.
Section 91(4)(m) – Whether the applicant was being maintained by the deceased person before that person’s death
103 There was no evidence led that the plaintiff was being maintained either wholly or partly by the deceased.
Section 91(4)(n) – The liability of any other person to maintain the applicant
104 Since 2010, the plaintiff has been with his current partner, Ms Geraldine Fleming.[102] Whilst they have travelled together, the plaintiff does not live with her, sees her one or two nights a week if they can manage it, does not have a common existence together and she does not hold assets for him.[103] In his second affidavit, the plaintiff said that they went to Thailand in 2014 with his two children but that Ms Fleming paid her own way. In 2016, they travelled to England and Ireland to attend Ms Fleming’s sister’s wedding. Ms Fleming paid for the plaintiff’s flights after the plaintiff did some work at her house.[104] The plaintiff said that they split the car hire and accommodation costs.[105]
[102]T36 L25
[103]T36 L24-31
[104]JCB 40
[105]T43
105 I accept that Ms Fleming and the plaintiff have an informal relationship and that Ms Fleming does not have a responsibility to maintain the plaintiff.
Section 91(4)(o) – The character and conduct of the applicant or any other person
106 Counsel for the defendant submitted that the plaintiff’s failure to warn his parents of the financial risk of being guarantors of his loan and failure to ultimately repay the amount that they paid on his behalf to the bank amounted to disentitling conduct.
107 I accept that the plaintiff did not provide his parents with any financial advice when they guaranteed his loan and that the plaintiff considered his father knowledgeable in the area as he had an accounting background.[106] He also assumed that they had received financial advice from the defendant.[107] Counsel for the plaintiff submitted that it was a precarious financial time and the Tavern’s failure was not as a result of his moral turpitude or abject incompetence.
[106]T27, L2-3
[107]T27, L5-6
108 Given that the overwhelming evidence is that the plaintiff’s relationship with his deceased mother was unaffected by the financial events of the Tavern and that she did not harbour animosity towards him as a result, I do not accept that the plaintiff’s behaviour equates to disentitling conduct.
109 Both parties agreed that the plaintiff suffered three financial “setbacks”, which were the failure of the Tavern, the failed Hong Kong property venture and judgment against him in the VCAT proceeding. Although the plaintiff had unsuccessful business endeavours and has failed to manage his finances appropriately, I take the view that he is not a spendthrift and his financial mismanagement does not amount to disentitling conduct in accordance with current authorities on the issue.[108]
[108]See for example McCann v Ward and Burgess [2012] VSC 63 and Carroll v Cowburn [2003] NSWSC 248
Section 91(4)(p) – Any other matter the Court considers relevant
110 There does not seem to be any other relevant matter that I have not already considered.
Conclusion
111 Typically, adult children have powerful claims on their parents’ estates. I must also pay regard to the considerations in s91(4)(e) to (p). The plaintiff is an adult son of the deceased mother. The evidence supports that they had an ongoing relationship of love and devotion. The deceased mother’s estate is small. I take the view that, based on the limited evidence before me, the plaintiff is in a poor financial state compared to the stronger financial positions of the defendant and Ms Vastbinder. Ms Murphy is in a slightly better financial position than the plaintiff. I accept that even if the plaintiff sold his remaining assets, he could not clear his debt. He is at an age where he is on the cusp of retirement and has no security for the future. Although his parents guaranteed his loan twenty-five years ago, this was a significant benefit he received during the deceased mother’s lifetime and heavily weighs into my assessment.
112 On the basis of my foregoing findings and consideration of prevailing community standards, I take the view that a wise and just testator, fully aware of all the relevant circumstances, would consider that the deceased mother had a moral duty to adequately provide for the plaintiff’s maintenance and support in her Will.
Did the deceased, in the distribution of the estate, make adequate provision for the proper maintenance and support of the Plaintiff?
113 The deceased mother gifted $500 and a 1980 Volvo motor vehicle to the plaintiff in her Will.
114 Based on the evidence provided by the plaintiff, he has an unknown amount of debt. Comparing the financial liabilities and the $500 he was given in the Will, the latter amount will do little, if anything, to alleviate his debt.
115 I would disagree with counsel for the plaintiff that the provision made was “manifestly” inadequate. However, I take the view that, in the circumstances, the provision made was inadequate.
Third, the amount of the provision (if any) the Court should order
116 I will deal with this matter after I have addressed the plaintiff’s claim on his deceased father’s estate.
(b) Deceased father
First, was the plaintiff an eligible person?
117 Following the amendments of the Act, the Court cannot make a family provision order unless that person is an “eligible person” as defined in the Act.
118 It was conceded by the defendant in written submissions that the plaintiff was an “eligible person” under the Act as he is an adult child of the deceased.[109]
Second, at the time of the deceased’s death, the deceased had a moral duty to provide for the eligible person’s proper maintenance and support
[109]Section s90(b) of the Act
119 The authorities and conclusions that I have stated in regard to “moral duty” of the deceased mother also hold true in the case of the deceased father.
120 Nevertheless, I must take into account the factors outlined in s91A(1), which are the deceased’s Will, any evidence of the deceased’s reasons for making the dispositions in the deceased’s Will and any other evidence of the deceased’s intentions in relation to providing for an eligible person.
121 Justice McMillan said, in the recent decision of Brimelow v Alampi,[110] that:
“It has always been the case that the courts have taken into account the terms of any expressions of the deceased in admissible form … By mandating that the Court must take such expressions into account it is not intended that such evidence, by will or in other evidence, suddenly takes on some higher status. The weight to be attached to such statements will depend on the circumstances. … .”
[110][2016] VSC 135 at paragraph [15]
122 In clause 6(3) of the deceased father’s Will, the deceased stated that he did not make further provision other than to give the plaintiff $500, because the deceased had made adequate provision for the plaintiff during his lifetime.
123 I am satisfied that the plaintiff received benefits during the deceased’s lifetime, which were substantial, particularly in the form of a guarantee on the plaintiff’s loan to purchase a one-third share in the Tavern. I must take into account the reason for the deceased giving the plaintiff the amount of provision he did when making an order.
124 I also take into account clause 6(1) of the deceased father’s Will, which gives the defendant $125,000 “in acknowledgement of his financial support he provided to me and my wife during our lifetime”.
125 The list of discretionary factors contained in s91A(2) are in essence re-stated in s91(4) in the pre-amendment legislation, which I have addressed in my reasons above regarding the deceased mother’s estate. To avoid repetition, I will briefly outline these factors as they apply to the deceased father’s estate.
126 I accept that the deceased father had responsibilities to all of his children that arose as being a parent. The size of the deceased father’s estate is larger, at $395,922.71; however, I would still describe the estate as small, given that no legal costs incurred have been deducted and that there are four competing claims on his estate. Ms Murphy is in a slightly better financial position than the plaintiff and the defendant and Ms Vastbinder are clearly in better financial terms. There is no evidence to support that the plaintiff’s spinal condition affects his ability to earn income as a self-employed builder but I acknowledge that all siblings suffer from some physical or mental disabilities. In particular, Ms Murphy has lung cancer. Although the plaintiff made a very small contribution to build up the deceased father’s estate through home maintenance and repair, this must be balanced against the assistance and support that Ms Vastbinder, Ms Murphy and the defendant also gave to their father in his later life. As aforementioned, the plaintiff received a substantial benefit in the form of a guarantee from his parents, as well as minor cash payments. The plaintiff was not being maintained by the deceased father and does not have any other person to maintain him. I do not consider the circumstances surrounding the guarantee given by the deceased mother and father for the plaintiff’s loan regarding the Tavern as conduct that disentitles the plaintiff to the estate.
127 Lastly, the current legislation contains an additional factor in s91A(2)(l), which is not present in the pre-amendment legislation. That is, the Court must consider the effects a family provision order would have on the amounts received from the deceased’s estate by other beneficiaries. I will discuss this factor in more detail.
128 Counsel for the defendant submitted that the $200,000 sought from the estate by the plaintiff would have a significant effect upon the entitlements of the other beneficiaries. Counsel for the plaintiff cross-examined the beneficiaries on this issue at trial. The defendant acknowledged that it would make a difference but that it would not be a “significant difference” if the amount he received from his parents’ estates was reduced. He agreed he could forgo the difference.[111]
[111]T92, L1-13
129 In cross-examination, counsel for the plaintiff pushed Ms Murphy on the issue, and the following exchange occurred:
Q:“I don’t suggest for a moment that you are a wealthy woman but do you agree with the proposition that your entitlement to an inheritance under this estate, if it was to be reduced or rather, it could be reduced to make provision for your brother, to some extent and that is an outcome that you could tolerate?---
A:It would be difficult but could possibly tolerate (sic).
Q:I don’t suggest you would be thrilled about it but it as something that you could tolerate?---
A:As I said, with a bit of difficulty, yes.
Q:To the extent that there’s a difficulty, you’ve managed with your current resources for some time?---
A:Yes, but the balances are going down.”[112]
[112]T97, L19 – T98, L12
130 I accept that Ms Murphy would find it difficult to have a reduction in her provision from the Wills because she and her husband have limited financial resources and she has poor health.
131 Ms Vastbinder conceded that she had more than enough to meet her material needs. She told the Court that the reason she opposed the plaintiff’s claim was so that she could maximise her inheritance for her four children and also to recognise the wishes of her parents in their Wills.[113] Ms Murphy resisted that some of her share of her parents’ estates be given instead to the plaintiff as her parents always said they will treat the siblings equally.[114]
[113]T122, L16 – T123, L4
[114]T98
132 I accept and take into consideration that a family provision order would significantly affect Ms Murphy’s ability to fund her retirement but that the effect would not be as significant on the other beneficiaries.
Conclusion
133 On the basis of my foregoing findings and consideration of prevailing community standards, I take the view that a wise and just testator, fully aware of all the relevant circumstances, would consider there was a moral duty on behalf of the deceased father to provide for this eligible person’s proper maintenance and support.
Third, that the distribution of the deceased’s estate fails to make adequate provision for the proper maintenance and support of the eligible person
134 The Court’s assessment of what is adequate and proper is governed by the value of the estate and the needs of competing beneficiaries.
135 As the deceased father has made no provision for the plaintiff in his Will, and given the plaintiff’s poor financial state, it is clear that the deceased father has failed to make adequate provision for the plaintiff’s proper maintenance and support in his Will.
Amount of the provision
136 In determining the amount of provision to be made, the Court is directed by statute to take into account the factors in s91(4) and the degree to which:
· the deceased had a moral duty to provide for the applicant;
· the distribution fails to make adequate provision for the proper maintenance and support of the plaintiff; and
· the eligible person is not capable by reasonable means of providing adequately for his proper maintenance and support.
Amount to be provided from the deceased mother and deceased father’s estate
137 In Brimelow v Alampi,[115] McMillan J described the determination of the ultimate question as follows:
“What constitutes proper provision for the maintenance and support of an applicant involves a consideration of the station in life of the applicant, the age, sex, health and financial resources of the applicant, the size and nature of the testator's estate and the totality of the relationship between the applicant and the testator and the relationship between the testator and other persons who have legitimate claims upon his or her bounty.
In determining what is adequate for the proper maintenance and support of an applicant, the Court has regard to the necessities or needs of the applicant and his or her own capacity and resources for meeting them. This also involves a consideration of the nature, extent and character of the estate and the other demands upon it, and also what the testator regarded as superior claims or preferable dispositions. Thus, in determining this question, a balance must be drawn between the established claims of the named beneficiaries, the needs of the applicant, the size of the estate and the benefits provided to the applicant and others with legitimate claims upon the testator. The Court’s function is not to ensure a fair distribution of the testator’s estate or to achieve equality amongst various claimants. The Court’s role goes no further than making adequate provision for the proper maintenance and support of an applicant.”
[115](supra) at paragraphs [20] and [21]
138 In McKenzie v Topp,[116] Nettle J said:
“Section 91 of the Act confers wide power to make such order as is thought fit in all the circumstances of the case. It is plain, however, that the discretion is not untrammelled or to be exercised according to idiosyncratic notions of what is thought to be fair or in such a way as to transgress unnecessarily upon the testatrix’s freedom of testation, but rather carefully and conservatively according to current community perceptions of the provision which would be made by a wise and just testatrix.”
[116][2004] VSC 90 at paragraph [63]
139 I also have regard to the cases that say proper maintenance and support must be enough to keep “the wolf from the door” and should be sufficient to free the plaintiff's mind from the reasonable fear of insufficiency as he grows older and his health and bodily strength gradually fail.[117]
[117]Worladge v Doddridge (1957) 97 CLR 1 at 12
140 As aforementioned, I accept that the plaintiff is in a poor financial state. He is on the cusp of retirement with unknown debts, no savings and no superannuation. He receives rental income and a wage as a self-employed builder. Ms Murphy is in a slightly better financial position than the plaintiff, as she has limited savings and a pension, but she also has health problems and her joint superannuation is her major asset. Conversely, the defendant and Ms Vastbinder are in stronger financial positions than the plaintiff, with more assets and savings. In addition, the defendant stands to receive the $125,000 legacy from the estates.
141 I consider that the moral obligation of the deceased mother and deceased father in this case is not to the extent that the entire debts of the plaintiff be cleared. Whilst the plaintiff may be in need, I must make an order that is measured by the size of both of the estates, which are small, and competing moral claims, which are Ms Murphy, Ms Vastbinder and the defendant.
142 I am also of the view that the defendant’s legacy of $125,000 should not be disturbed, given that the deceased mother and father made their intentions clear that this was the repayment of a debt to the defendant who made financial and business sacrifices to ensure they did not lose their family home. Nevertheless, all parties were in agreement on that being the case.
143 The combined total amount of the estates is $654,808.85. Subtracting the legacy of the defendant of $125,000, the residual estate is $529,808.85.
144 The plaintiff estimates his costs to be $55,000 at the end of trial. The defendant’s estimates his costs to the end of trial are $58,000. Subtracting the legal costs from the total estate, there remains $416,808.85 to be distributed. If the Will was distributed as it stands, the defendant, Ms Vastbinder and Ms Murphy would receive $138,769.61 each and the plaintiff would receive $500.
145 In exercise of my discretion, I have taken into account all factors and circumstances referred to above. I think what is adequate and proper, based on accepted community standards, is to make provision for the plaintiff out of the deceased mother’s estate in the sum of $33,000 and the deceased father’s estate in the sum of $47,000. The combined total is $80,000.
146 In written submissions, counsel for the defendant urged me to order that any provision for the plaintiff be borne equally between the three beneficiaries. Section 97(2) of the current Act directs me that the burden of the provision shall be borne by the beneficiaries in proportion to their respective interests as stated in the relevant Will, which are in equal shares.
147 Accordingly, the plaintiff will receive the amount of $80,000. The defendant also receives the legacy of $125,000 from the estates. The residuary of the deceased mother’s estate and deceased father’s estate amounts to $336,808.85 and will be equally shared between the other three siblings and beneficiaries as stated in the deceased mother and deceased father’s Wills, which means that they will receive $112,269.61 or thereabouts each.[118]
[118]I was informed by the defendant that there was a small and unknown tax refund for both estates for the year ended 30 June 2015, which forms the residuary of the estates
148 I have included the costs of both parties to arrive at a figure for which I consider is an appropriate figure for further provision for the plaintiff. I am prepared to hear further from the parties as to the reasonableness of the parties costs.
Orders
149 I propose to order that further provision be made for the plaintiff in the amount of SEVENTY NINE THOUSAND FIVE HUNDRED DOLLARS ($79,500.00) based on my conclusions above.
150 I will hear the parties on costs and as to the form of the order I should make.
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25
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