Anderson v Patterson
[2024] NZHC 1499
•7 June 2024
IN THE HIGH COURT OF NEW ZEALAND DUNEDIN REGISTRY
I TE KŌTI MATUA O AOTEAROA ŌTEPOTI ROHE
CIV-2023-412-000021
[2024] NZHC 1499
UNDER Section 49, of the Administration Act 1969 IN THE MATTER OF
the Will of ELIZAETH BEVIN PATTERSON
BETWEEN
SANDRA MARIE ANDERSON
Plaintiff
AND
ELIZABETH JANET PATTERSON
Defendant
Hearing: 21 February 2024 Appearances:
G P Tyrrell for Plaintiff
A J Douglass and S Gaskell for Defendant
Judgment:
7 June 2024
JUDGMENT OF PRESTON J
This judgment was delivered by me on 7 June 2024 at 4.00 pm pursuant to r 11.5 of the High Court Rules.
Registrar/Deputy Registrar
Date……………
ANDERSON v PATTERSON [2024] NZHC 1499 [7 June 2024]
Introduction
[1] When Elizabeth (Betty) Bevin Patterson died she left her estate in entirety to one of her four children, the defendant Elizabeth Patterson (Liz).
[2] Another daughter, the plaintiff Sandra Anderson (Sandra) has filed a claim in the Family Court. Sandra received nothing under the will. She seeks further provision from the estate under the Family Protection Act 1955 (FPA).
[3] Sandra’s proceeding in this court, for interim injunctive relief, has been brought because of the sequence of events surrounding the filing of her FPA claim.
[4] Just before the Christmas court vacation, on 21 December 2022 Sandra’s then counsel emailed the executor of the estate advising he was going to file Sandra’s claim that day or the following. The proceedings were, in fact, filed that day.
[5] In the new year the executor emailed all parties noting she had not received Sandra’s proceedings and that she intended to distribute the assets unless she received proof of filing by 30 January 2023.
[6]What happened next is the subject of a central dispute on the facts.
[7] Sandra’s counsel responded to the executor by email. He confirmed the proceedings had been filed, attaching copies of the documents as filed. The email was sent to the executor’s email address as in the usual course of the correspondence between the parties to that point. However, the executor deposes she did not receive it. As a result and being satisfied the notice period for filing of any FPA claim had expired, on 8 February 2023 the executor transferred the property to Liz.
[8] Sandra now seeks interim injunctive relief including following orders, to protect against further disposition of the property pending determination of the FPA claim. In response, Liz applies for summary judgment dismissing the claim for interim relief, on grounds it cannot succeed.
Background
[9] Betty Patterson was predeceased by her husband, Lionel. She and Lionel had four children: Karen Anne Reynolds, the plaintiff Sandra Marie Anderson, a son Fraser George Patterson and the defendant, Elizabeth Janet Patterson.
[10] Ms Sharon Lont is a second cousin of Lionel and was his and Betty’s solicitor for some 25 years. Each appointed her as executor and trustee of their respective estates. Under Betty’s last will dated 26 February 2012, she left her residuary estate to Liz. The major asset in the estate is Betty’s former home in [ ] (the property). It is valued at $700,000.
[11]Betty died on 19 April 2022.
[12] Probate of the will was granted to Ms Lont on 5 July 2022. Seven weeks later Sandra’s children wrote to Liz by email, copied to the executor, notifying in substance what would become the FPA claim and suggesting a mediated resolution. There was no mediation. Sandra engaged counsel, Mr Evans, who notified Ms Lont by email that Sandra intended to challenge the will.
[13] The 14 October email started the clock running, as it were, under the statutory timeframes governing the distribution of estates in the Administration Act 1969.
[14] Ms Lont recorded this, and other matters in a careful letter of 31 October 2022. Relevantly, the executor noted:
Lionel and Betty were adamant in their instructions regarding their last will in that they wished to provide a home for Liz, who had lived with them and provided assistance over many years. They understood that a claim may be made against the estate by another of their children. Although this possibility saddened them, they were very certain about their wishes and were not of a mind to compromise on what they thought was right.
…
… [I]t appears that Fraser owes the sum of $506,250.00 plus interest to Betty’s estate (as she was Lionel’s sole beneficiary).
…
Hamish Evans acts for Sandra
On 14 October 2022 he put me on notice that proceedings may be filed. His time to file will expire on 14 January 2023 January [sic], which roughly coincides with the end of the period of six months after probate.
Len Anderson acts for Liz
I have been able to ascertain, via an old will, that at one stage Liz was indebted to her parents in the sum of $162,000.00. At this stage I cannot piece together full details of whether that has been forgiven, paid back or if it merged with the gift to her via Betty’s will. Len may be able to take instructions regarding this if it is deemed necessary.
Liz paid rent on the house while her mother was in Frances Hodgkin and this helped to pay Betty’s care. The family were kept fully informed at all relevant times, except for Fraser to whom I ceased non essential communication (after appropriate caution) with because of his frequent abusive communications to me. I was very clear that I was more than happy to communicate with his lawyer.
Karen is unrepresented.
There is no doubt that Karen and Sandra’s gifts from Betty of $45000.00 each, (advanced in 1995) have been perfected. I attach a summary of all gifting that I have recorded.
I shall wait for an agreement, order of the court or time limits to expire prior to taking further action.
Please let me know if I can assist in any other way or provide any further information.
(emphasis added)
[15] After this, Mr Evans wrote to Liz’s then counsel, the late Mr Andersen KC enquiring about the potential for settlement short of issuing proceedings. On 7 December 2022 Ms Lont emailed all parties advising her intention to distribute the estate after mid-January 2023, if proceedings were not filed by the expiry of the notice period in s 48(1) of the Administration Act on 14 January 2023.
[16]Mr Evan’s settlement overtures were unsuccessful.
[17] On 21 December three important events occurred. First, Mr Evans emailed the parties. This email is central to the dispute before me. It read:
Dear all,
I am going to file proceedings on behalf of Sandy either later today or tomorrow morning. I need to ask the court to make directions as to service. Can you please confirm that;
1.Sharon, you will accept service in your capacity as trustee and executor.
2.Len, you are able to accept service on behalf of Elizabeth.
3.Phil, you can accept service on behalf of Fraser.
4.Karen, you agree to accept service through a copy of the proceedings being emailed to you.
If that is not acceptable, then service will need to be made on each individual personally. I hope that will not be required.
Regards
Hamish Evans
[18] Second, Mr Evans filed the proceedings by courier to the Dunedin Family Court.
[19] Third, Ms Lont by email replied to Mr Evans’ service enquiry: “I confirm I shall accept on behalf of the estate”.
[20] Following the court Christmas vacation and after the notice period had expired, on 20 January 2023 Ms Lont sent Mr Evans a further email. She sought proof of filing:
Hello Hamish, I have not received any proceedings. Unless I receive proof of filing by Monday 30 January 2023, I intend to distribute the assets at hand in this estate,
Sharon Lont
[21] No service copies of the filed proceedings were yet available from the court but Mr Evans replied on 23 January in these terms: 1
Dear Sharon,
I attach a copy of my letter to the Family Court together with a copy of the pleadings filed in December. My letter was sent by tracked courier and I can see that the courier arrived at court on 23 December.
I haven’t had an acknowledgement from the court yet. Once I have a minute from the Judge, I will serve everyone. Given that proceedings have been filed it is not appropriate to make any form of distribution from the estate.
Regards
Hamish Evans
1 The evidence shows that while the Family Court order directing service of the Family Protection Act proceedings had been made on 11 January, filing of the proceedings was not confirmed to Mr Evans until 3 February 2023.
[22]Ms Lont denies receiving the 23 January email.
[23]On 8 February 2023 Ms Lont as executor transferred the property to Liz.
[24] When they learned of the transfer, Sandra’s lawyers sought an undertaking from Liz that she would not dispose of the property pending determination of Sandra’s claim in the Family Court.
[25]Liz declined to provide any undertaking.2
[26]As a result, Sandra filed the present application for injunctive relief.
The parties’ cases: for interim injunction and for summary judgment
[27] Sandra filed her claim for further provision from the estate well within the statutory timeframe — 12 months from grant of probate.3 She argues that notice was given and Ms Lont was in fact served the documents prior to disposition of the property, irrespective of whether the executor received the email transmitted.
[28] In those circumstances, Sandra says she is entitled to provision from the estate, which provision — to be determined — should be protected by interim orders pending the Family Court’s determination. She seeks:
(a)an injunction to restrain further disposition of the property;
(b)an order that Liz is holding Sandra’s interest in the property on constructive trust; and
(c)an order under s 49 of the Administration Act (following order), conditional on advancement of the FPA claim, requiring that Liz:
2 After the plaintiff’s application for interim injunction was filed Liz provided an interim undertaking in terms as sought, pending the court’s disposition of the interlocutory proceedings.
3 Family Protection Act 1955, s 9. Probate was granted on 5 July 2022; the FPA claim was filed on 21 December 2022.
(i)transfer an interest in the property commensurate with Sandra’s entitlement under the FPA (to be determined); or
(ii)pay Sandra a sum equivalent to her entitlement under the FPA.
[29]Liz resists any claim under the FPA.
[30] She contends Sandra cannot succeed on any cause of action as neither she nor the executor received notice that a claim had been lodged prior to the distribution on 8 February 2023. Therefore, she says, Ms Lont was entitled to distribute and to be indemnified in doing so: distribution was made more than six months after the grant of administration and more than three months after expiry of the plaintiff’s notice of intention to bring a claim.
[31] Accordingly, Liz seeks summary judgment dismissing the claim for interim relief.
[32] In response to the summary judgment application, Mr Tyrell submits that to succeed on the facts Liz must establish that service on the executor did not occur before the distribution. Affidavit evidence of Mr Lechner-Page, an information technology consultant/technician shows that the 23 January email was sent from Mr Evans’ system. Counsel submits service was therefore effected under the Family Court Rules 2009 (FCR). Further, Mr Tyrell contends, there could not be a more stark basis on which equity should intervene to ensure Sandra’s strong claim for provision can be heard in the Family Court.
[33] In any event, counsel argues the summary judgment application is without merit as it seeks to rely on statutory protections for administrators as a bar to any claim after distribution.
Approach
[34] The summary judgment application must first be determined, as if I find for Liz there will be no subsisting claim justifying interim relief.
Summary judgment: principles
[35] The principles are well settled. On a defendant’s application for summary judgment under r 12(2) of the High Court Rules 2016 the onus is on the defendant to show that the claim cannot succeed. The court must be left without any real doubt or uncertainty whether there is a real question to be tried.
[36] Importantly, the court will not normally resolve material conflicts of evidence or assess the credibility of deponents. As the Court of Appeal observed in Krukziener v Hanover Finance Limited, in the end the court’s assessment of the evidence is a matter of judgement. Summary judgment will be denied if it appears that there is an issue worthy of trial.4
Summary judgment: discussion
Three issues arise on the summary judgment application:
(a)Was notice effected under the Administration Act?
(b)If not, did the email of 23 January 2023 constitute service or notice prior to distribution?
(c)Even if Ms Lont was entitled to distribute — or at least protected from liability in distributing — the property, is that a bar to relief?
Was notice effected?
[38] The first issue may be shortly dealt with. The ability of an administrator to distribute is suspended for three months if they receive notice in writing from an applicant of intention to bring a claim under the FPA.5 However, any such notice lapses, under s 48(1) of the Administration Act:
4 Krukziener v Hanover Finance Limited [2008] NZCA 187.
5 Administration Act 1969, s 48(1).
“…unless, before the expiration of 3 months after the date [of written notice to the administrator] the administrator … is served with a copy of the application or receives notice in writing that the application has been made to the court.
[39]Mr Evans’ email advice on 21 December did not notify that a claim had been
made but rather, that one was going to be made.
[40]Accordingly, it was not a valid notice under s 48(1).
[41] Mr Tyrrell understandably on the facts does not press the notice point. However, he emphasises the factual significance of Mr Evans’ email of 21 December: it put all parties including the executor on notice that proceedings were imminently to be filed and within the statutory timeframe for any such claim. The proceedings were in fact filed that day.6
Was service effected by the email of 23 January?
[42] The next question is whether the executor was served or notified prior to the distribution.
[43] Ms Lont’s evidence is that she did not see the email of 23 January and has not since found a copy of it in her inbox, junk mail or deleted mail folders. Liz argues that even if the proceedings were sent to Ms Lont this did not constitute effective service and there was no notice of proceedings having been filed, as the email was not received or drawn to Ms Lont’s attention.
[44] Certainly, all Ms Lont’s other actions are consistent with her evidence that she would not have distributed if she had been aware that the proceedings had been filed. There is no suggestion of malfeasance. On the other hand, Mr Lechner-Page deposes that the email was sent from Mr Evans’ system, without ‘bounceback’. Further, it would be possible and swift for an independent information technology expert to
6 The proceedings were electronically filed by email on 21 December 2022 and couriered to the Dunedin Family Court. The courier arrived on 23 December 2022.
undertake an audit of Ms Lont’s computer system to detect whether the email was in fact received.7
[45]The parties contest whether the email constitutes service under the FCR.
[46] Rule 113A(1) of the FCR relevantly provides that a document may be “served electronically by transmitting a copy to an electronic address for service that the person to be served has provided for the purpose of receiving the document”. Under the Rules, electronic service in accordance with r 113A is deemed effected at the time the document was transmitted, provided it was properly addressed to the electronic address which had been provided for service.8
[47] Sandra’s intention to file imminently was clearly signalled on 21 December 2022. Mr Evans’ enquiry as to service underscored this. Equally, it is clear that Ms Lont sought to confirm whether the proceedings had in fact been filed before distributing. She promptly confirmed by email on 21 December that she would accept service on behalf of the estate. She followed up with an enquiry by email to Mr Evans on 20 January 2023 seeking proof of filing. I consider that those two communications together support Sandra’s case that service — or notice — was effected by the sending of the email of 23 January whether received by Ms Lont or not, for two reasons.
[48] First, on the issue of service under the FCR. The evidence shows a course of conduct between counsel prior to the 21 December email of substantive written communications including with Ms Lont, a solicitor, on behalf of the estate. While Ms Lont’s reply did not expressly acknowledge the acceptance of electronic service nor expressly confirm Ms Lont’s address for service, it impliedly provided both, given the nature of the enquiry to which it responded and the fact it was sent by Ms Lont from her email address.
7 The defendant objects to reference to Mr Lechner-Page’s evidence as expert evidence and complains that he does not state compliance with Schedule 4, High Court Rules 2016. Nothing turns on this aspect, in my view: in subsequent email correspondence between Mr Evans and Ms Lont — Mr Evans attached a copy of the 23 January 2023 email as sent from his computer system, which reflects the substantive evidence of Mr Lechner-Page on the crucial issue whether the email was transmitted.
8 Family Court Rules 2002, r 127A.
[49] Nor does the enquiry whether Ms Karen Reynolds would accept service by email suggest otherwise, as Ms Douglass argues. Ms Reynolds was the only party in the email chain who was not represented by counsel. The enquiry to each of the other lawyers (including Ms Lont) was similarly silent as to mode, but asked if they would accept service on behalf of their client and thus avoid having to personally serve each party to the FPA proceedings personally. In my view Ms Lont’s reply on 21 December impliedly provided her email address for service and it is at least arguable that service was effected by the transmission of the 23 January email.
[50] Second, and in any event, what Ms Lont sought in her email of 20 January which prompted the contested 23 January response, was not service but “proof of filing”. She requested this before 30 January 2023 failing which she signalled she intended to distribute the estate. Mr Evans was not in a position to provide court- issued service copies of the documents.9 But, Mr Lechner-Page’s evidence is that the email — which did provide proof of filing and copy pleadings — was sent.
[51] In those circumstances, even if I am incorrect that service was effected under the FCR when the email was sent, summary judgment is not appropriate: there is a material factual dispute whether the executor was in fact notified prior to distribution.
Is there a statutory bar to relief?
[52] The third issue is whether there is a statutory bar to relief. This is strictly unnecessary to determine on the summary judgment application, as I have found there is a reasonably arguable issue on the substantive claim. However, this issue is engaged in any event on the application for injunctive relief to which I turn if Liz’s summary judgment application fails.
9 As Mr Tyrell noted in submissions, there is no magic in receipt of “service copies” from the court but, rather, the record shows that Mr Evans was awaiting the Family Court’s confirmation that the proceedings had been filed and further its directions as to service on parties.
[53] Liz argues that as Ms Lont was entitled to distribute — and is protected from liability in distributing — the property the Court should not permit the claim for equitable relief. This argument relies on s 47 of the Administration Act, which provides indemnities for administrators against certain claims including under the Family Protection Act.
[54]I do not accept there is a statutory bar to relief.
[55] The starting point is that as noted Sandra brought the FPA claim well within the statutory timeframe, of 12 months following the grant of probate.
[56]Section 47(4) relevantly provides:
47 Protection of administrator against certain claims
…
(4)No action shall lie against the administrator or trustee by reason of his or her having distributed any part of the estate if the distribution was properly made in accordance with [s 48(2)], by the administrator or trustee after the expiration of 6 months from the date of the grant in New Zealand of administration in the estate of the deceased, and before service on him or her of any application, and without notice in writing of any application or intention to make an application that would affect the estate, …
[57] As has been discussed, Liz here relies on the executor’s evidence that the s 48 notice given on 14 October lapsed as the 21 December email did not confirm the proceedings had been filed but rather they were about to be, and nor was she served or put on notice as she did not receive the 23 January email. However, it does not follow, as Liz contends, that if the executor is therefore protected from liability the distribution cannot be disturbed.
[58]Section 49 of the Administration Act relevantly provides:
49 Following of assets, etc
(1)In any case where an administrator or trustee has made a distribution of any assets forming part of the estate of any deceased person or subject to any trust and there is nothing in any Act to prevent the distribution from being disturbed, the court may—
(a)make, subject to such terms and conditions as it thinks fit, in respect of any interest in any such assets that is for the time being retained by the person to whom those assets were distributed or his or her administrator or any person who has received any interest in those assets from either of them otherwise than in good faith and for full valuable consideration, any order to which section 47 applies, or an order on any claim to which section 79 of the Trusts Act 2019 applies, or an order requiring the transfer or payment of any such interest in any such assets to the administrator of the deceased or the trustee or to any person who in accordance with any enactment or rule of law has a right to follow the assets:
…
(b)in making any such order fix such terms and conditions as the court thinks fit, and for the purpose of giving effect to any such order, make such further order as it thinks fit.
(2)The remedies given to any person by subsection (1) are in addition to all other rights and remedies (if any) available to that person, and nothing in that subsection shall restrict any such other rights and remedies.
…
[59] Section 49 thus expressly provides that the court may grant a following order against a person in Liz’s position in respect of distributed assets in circumstances where an administrator has properly — lawfully — distributed such assets.
[60] The jurisdiction to grant such orders was noted by Isac J in Hunt v Moriarty. His Honour summarised the statutory provisions governing the distribution of estates and for bringing claims against them, as follows:10
(a)No application under the Family Protection Act “shall be heard” unless it is made within 12 months from the grant of probate (ss 9(1) and (2)(b) of the Family Protection Act).
(b)However, an administrator is entitled to distribute an estate six months after the grant of administration (s 47(4) of the Administration Act).
10 Hunt v Moriarty [2022] NZHC 2121 at [12].
(c)The ability of an administrator to distribute is, however, suspended for three months if they receive notice in writing from an intending applicant of an intention to bring a claim under the Family Protection Act (s 48(1) of the Administration Act).
(d)However, if the intending applicant fails to file and serve proceedings within the three-month timeframe, the administrator may “act as if [they] had not received the notice” (s 48(1) of the Administration Act).
(e)Where a distribution has been made, “and there is nothing in any Act to prevent the distribution being disturbed”, the court may nevertheless direct the return of a distribution to the estate (s 49(1) of the Administration Act). These are commonly known as “following orders”.
(f)However, no application for a following order “shall be heard” unless the application is also made within 12 months from the grant of probate (s 49(3)(a) of the Administration Act).
[61] As Isac J also noted, the underlying principle of ss 47 and 48 of the Administration Act is that there should be a speedy distribution of an estate, and the provisions of a will should not be disturbed unless an application under the Family Protection Act has been made within the appropriate times.11
[62] It is tolerably clear from the statutory scheme that an executor’s entitlement to distribute at the conclusion of the three month notice period does not of itself terminate the rights of the FPA claimant. It may be, as Isac J observed in Hunt v Moriarty an FPA claim may be of little practical benefit if the estate has been lawfully distributed. Still, s 49 provides a means of clawing back a partial distribution, if application is made for such within 12 months of grant of probate.12 Here, the issue whether there was a lawful distribution is subject of the central factual (and legal) dispute about service or notification.
11 At [13], citing J Caldwell (ed) “Family Protection” in Family Law Service (NZ) (online loose-leaf, LexisNexis) at [7.908.01].
12 At [14].
[63] Ms Gaskell who argued this part of the application for Liz accepts that s 47 does not provide an absolute bar to equitable relief but submits that relief is not appropriate, absent any breach of trust or fiduciary duty on the part of the executor.
[64] However, I accept, as Mr Tyrell submits, that Liz’s argument conflates an executor’s indemnity in respect of an apparently lawful distribution with the issue of equitable relief. For this reason, the principal authority on which counsel for Liz rely,
Re Heberley does not assist.13
[65] In that case, the Court of Appeal considered the predecessor provisions to ss 47, 48 and 49 of the Administration Act 1969. It concerned an appeal against a decision of the Family Court granting the appellants — two adopted daughters of the testator — provision from the estate of $2,000 each. Notice of their intended FPA claim had been given to the executors in time. However, the notice had been allowed to lapse without any FPA claim being made before distribution. The Court of Appeal held the distribution could not be disturbed and declined to consider the merits of the underlying FPA claim. The decision turned on whether there was an available remedy for the appellants (applicants in the Family Court) as the FPA claim had been made out of time in the Family Court.14 The Court did not consider the availability of equitable remedies in the predecessor to s 49(2) of the current Act.
[66] Re Heberley involved a materially different situation than the present case, where Sandra’s FPA claim was made in time and indeed many weeks before subsequent distribution of the property.
[67] Of more assistance is the decision of a full court of this Court in Burt v Skelley.15 In that case, an executor distributed the whole of a significant estate notwithstanding he had notice by letter of an intended action for provision in the event
— as was the case — the applicant was not provided for in his grandmother’s will. Notice had lapsed under s 48(1) of the Administration Act before the distribution, but time for filing the Family Protection claim had not expired. A claim was filed under
13 Re Heberley [1971] NZLR 325 (CA).
14 And, further, out of time for any application to the Family Court for extension of time to bring the claim.
15 Burt v Skelley (1998) 17 FRNZ 152.
that Act, in time. The Family Court struck out the applicant’s claim, including his claim for following orders under s 49 and for a tracing order.
[68] On appeal, the High Court held that while there was no basis for following orders — which were in that case time-barred — the Family Court did have jurisdiction to hear the claim based on the equitable remedy of tracing.
[69] Relevantly, the Court held that s 49(2) of the Administration Act 1969 clearly contemplates that other equitable remedies may be available to an applicant, including in that case one who was out of time to obtain a following order under s 49. Further, unconscionability is a significant factor as to when equity will intervene. In that case the Court considered a successful case on unconscionability potentially arose, as the applicant had informed the executor promptly after the testator’s death of his intention to make a claim and the executor must have been deemed to have known a claim was to be brought and that assets could not be distributed before that was resolved.
[70] Unlike in Burt v Skelley, Sandra’s claim for following orders is not time-barred, being brought within 12 months of the grant of administration.16 She therefore does not need to invoke wider equitable remedies under s49(2). Further, although there is no allegation of unconscionable conduct, on Mr Lechner-Page’s evidence as discussed it is arguable that service was effected before distribution.
[71] It is necessary in my view to stand back and consider the sequence of key events leading up to and particularly between 21 December 2022 and the transfer of the property on 8 February 2023. I am satisfied there is a reasonably arguable basis to make following orders, and that they are appropriate: if Sandra’s case is proved, there was deemed service upon the executor notwithstanding she was personally unaware of such service or notice.
16 Administration Act, s 49(3).
[72] Nor do I accept that conditional following orders will act to penalise Liz for receiving the distribution in good faith, as her counsel contends. On the evidence it appears Liz was residing in the property prior to distribution. The orders will simply act to preserve the position — and the only material asset of the estate — pending determination of the FPA claim.
[73] Further, any delay in the Family Court as Liz has not yet filed a substantive response pending her application for summary judgment is a result of her election to proceed on that basis.
[74] For these reasons, I am satisfied that the claim for summary judgment is not established.
Application for injunctive relief
[75]I turn now to Sandra’s application for injunctive relief.
[76] Ms Douglass for Liz submits that if the Court does not grant summary judgment it ought not determine the application for interim relief but instead should adjourn to enable additional evidence to be called. For the reasons I set out below, I reject that submission.
[77] Sandra seeks an injunction against further disposition of the property and ancillary orders including the following orders already discussed.
[78] Although I have found the s 48(1) notice was not effective, the nub of Sandra’s claim is that the executor was served, or notified of the Family Court documents before the distribution of the property. Sandra argues she is entitled to provision from the estate (to be determined in the Family Court proceedings). She says it is necessary to preserve the position to injunct against dealing or disposition and to make following orders under s 49 and/or order that Sandra’s interest is held by Liz on constructive trust, pending determination of the Family Court.
Approach - principles
[79] To obtain interim relief, Sandra must first establish that there is a serious question to be tried or, put another way, that her claim is not vexatious or frivolous. I must then consider the balance of convenience, that involves assessment of the impact on the parties of granting, or refusing to grant, an order. Finally, I must assess the overall justice of the position as a check.17
A preliminary point – should I grant an adjournment to enable further evidence?
[80] Liz does not dispute that the documents were sent apparently successfully by email on 23 January 2023. She intends to oppose the FPA claim but has not pleaded a defence, pending determination of her application for summary judgment. She argues the merits of the FPA claim are relevant to this Court’s assessment to grant injunctive relief. She submits no orders should be made but rather the application should be adjourned to enable the Court to consider both parties’ positions once pleadings and evidence are filed in the Family Court.
[81] I am unable to accept that submission. First, it will be recalled Sandra’s application for interim injunction was filed only after an undertaking had been sought from Liz that she would not further deal with or dispose of the property pending the outcome of the Family Court proceedings. The FPA claim was in fact filed immediately when her counsel had signalled it was about to be: on 21 December 2022. By 20 February 2023 at latest, all parties were on notice of the unfortunate issue with service.
[82] Liz declined to provide an undertaking. Sandra filed in this Court to protect her position. The application in this Court is supported by Sandra’s affidavit filed in support of the FPA claim and a further full affidavit. Those two documents considered together set out considerable information about the family history and background, at least from Sandra’s perspective, central to her claim for further provision from the estate.
17 NZ Tax Refunds Limited v Brooks Homes Limited [2013] NZCA 90, (2013) TCLR 531 at [12].
[83] Liz was entitled to elect to proceed as she did in reliance on the counterclaim for summary judgment. She did not file an affidavit addressing the merits of the FPA claim, although I note the executor’s letter at [14] above recorded matters which will be relevant to Liz’s position in the substantive proceedings, which she intends to defend.18 However, in view of all these matters I consider it would be wrong to adjourn the application.
[84]Accordingly, I consider the application on the information before me.
Is there a serious question to be tried?
[85]I am satisfied there is a serious question to be tried in the Family Court.
[86] Children have a natural claim on a parent for a provision suitable to their needs, but what they can ask for is only what it was the will-maker’s moral duty to have given.19 In the oft-cited decision of Williams v Aucutt Richardson P, addressing the test whether a parent has made adequate provision for the proper maintenance of a claimant child, noted the breadth of the enquiry in light of the statutory language.20 Just what provision will constitute proper support is a matter of judgement in all the circumstances of the particular case.21 Family recognition alone can be sufficient to give rise to a moral duty.
[87] Sandra has been left out of her mother’s last will entirely. Liz has been left effectively the entirety of the estate being Betty’s former home in [ ]. There is no evidence of disentitling behaviour by Sandra. She deposes in the Family Court proceedings to the family background and in particular her involvement in later life with her parents and the nature of her contact with them. The evidence indicates this was limited to times when Liz was not present in the home but extended to mowing lawns, shopping trips and medical appointments and relatively regular visits before her mother’s death.
18 I record Ms Douglass’ indication from the bar that she received instructions after time for filing, following the passing of previous counsel Mr Andersen.
19 Geddes v Geddes (2002) 21 FCNZ 565; Re Kung (dec’d) [2000] NZFLR 396.
20 Williams v Aucutt [2000] 2 NZLR 479.
21 At [52].
[88] When living in Christchurch and prior to her mother’s death Sandra saw her mother as often as possible, about three times a year. She is not in a strong position financially and has some health issues. Her position is that: “I believe that I have been let down by Mum and there was no reason to exclude me from her will. I was as much a part of our family as her other children and I ask that the court makes further provision for me from her estate”.
[89] I do not ignore the paragraph in Ms Lont’s letter, set out at [14] above, which indicated an intention on (relevantly) Betty’s part in respect of the unequal treatment of her children in her will. The evidence is also that there was provision for Sandra, and other siblings, in Betty’s two earlier wills.
[90] In any event, Sandra’s evidence deposes both to grounds for a moral duty claim and to financial need. I accept, as Mr Tyrrell submits, the basis for further provision could not be more stark in this case there being no recognition of Sandra by her mother. I also accept that, even in circumstances suggesting some familial tensions, it is plainly arguable that the provision of zero per cent of the residuary estate does not provide proper support for Sandra.
[91] Further, and I as have found there is an arguable case that service or notification of the FPA claim was effected before disposition. I am satisfied that for this reason there is a proper basis to grant a following order under s 49, conditionally on the FPA claim being advanced.
[92] Accordingly, it is unnecessary for me to consider the merits of the further relief sought, for an order that the property is held on an institutional constructive trust, which Liz contests.
Balance of convenience
[93]Where does the balance of convenience lie?
[94] The only material asset of the estate is the property, valued at $700,000. It is no answer in this regard that, as Ms Douglass submits, Sandra may have a claim against her previous counsel or that she can sue Fraser for the alleged — but contested
— historic debt to the estate. There is no evidence to suggest the debt, even if provable, is realisable. And as I have found and Liz accepts, there is no statutory bar to equitable relief.
[95] The relief sought is to maintain the status quo. It protects against a pyrrhic victory, should Sandra succeed to any degree in the Family Court.
[96] Further, Sandra has provided an undertaking as to damages and there is no evidence of potential damages before the Court.
[97]The balance of convenience favours injunctive relief.
Where does the overall justice lie?
[98] Finally, I accept the interests of justice favour conditional orders to allow Sandra to pursue her FPA claim.
[99] That claim was, after exploration of a negotiated resolution, clearly signalled and promptly filed. That occurred comfortably within the 12-month statutory timeframe. Further, within less than two weeks of the executor’s distribution of the property, all parties were aware the claim had in fact been brought in time and were aware of the issues in relation to service.
Conclusion
[100] Liz has not persuaded me that there is no reasonable cause of action in the Sandra’s statement of claim.
[101] The email of 21 December did not give valid notice under s 48 of the Administration Act but there is an arguable basis to assert the executor was served, or notified of, the claim as filed by the email which Mr Evans sent on 23 January 2023.
This was before the distribution of the major asset of the estate. There is no statutory bar to equitable relief.
[102] Injunctive relief is necessary to protect the position pending the Family Court’s determination of the FPA claim. An interim injunction together with conditional following orders as sought, are sufficient for that purpose. It is not necessary to determine the application for an order declaring an institutional constructive trust.
Result
[103]The defendant’s application for summary judgment is dismissed.
[104] The plaintiff’s claim for interim injunction and conditional following orders is granted.
[105]I order, accordingly:
(a)The defendant is not to dispose of, deal with, mortgage or diminish the value of the property at [ ]
pending:
(i)further order of the Court; or
(ii)resolution of the proceedings filed in the Dunedin Family Court under FAM-2022-012-472.
(b)Conditional upon the plaintiff’s Family Protection Act claim being advanced, the defendant is to transfer an interest in the property commensurate with the plaintiff’s entitlement under the Family Protection Act 1955 (to be determined); or to pay the plaintiff a sum equivalent to her entitlement under the Family Protection Act (to be determined).
(c)Leave is reserved to the defendant to seek rescission of the order at (b) above if the Family Protection Act claim is not promptly advanced.
(d)Leave is reserved to apply for further orders or directions which may be necessary to implement this judgment.
(e)I see no basis why costs should not follow the event in favour of the plaintiff on a 2B basis. Memoranda are to be filed, limited to no more than four pages, as follows:
(i)Plaintiff’s costs memorandum by 21 June 2024.
(ii)Defendant’s costs memorandum by 8 July 2024.
(iii)Any memorandum, strictly in reply, by 15 July 2024.
………………………………………
Preston J
Solicitors:
Patient & Williams, Christchurch for Plaintiff Medlicotts Lawyers, Dunedin for Defendant
Counsel:
G P Tyrrell Barrister, Christchurch A J Douglass, Barrister, Dunedin
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