Brosnahan v Meo
[2021] NZHC 79
•4 February 2021
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV-2019-485-597
[2021] NZHC 79
UNDER the Family Protection Act 1955 IN THE MATTER OF
the Estate of the late Anne Brosnahan
BETWEEN
CHRISTEN PETER BROSNAHAN
First Plaintiff
SARAH ST CLAIR BROSNAHAN
Second PlaintiffANNA ST CLAIR MURPHY
Third PlaintiffRAVEN LEE McCALL
Fourth PlaintiffAND
JOHN CLAYTON MEO
Defendant
AND
THE O’CONOR INSTITUTE TRUST BOARD
Third Party
Hearing: 14-15 October 2020 Counsel:
T G A Manktelow for the Plaintiffs C Matsis for the Defendant
W J Palmer for the Third Party
Judgment:
4 February 2021
JUDGMENT OF CULL J
Contents
Background [8]
General background [8]
Peter’s promise [18]
Events after Cyril’s death [21]
BROSNAHAN v MEO [2021] NZHC 79 [4 February 2021]
The wills [26]
The plaintiffs’ circumstances [27]
The Will and value of the estate [31]
The issues [33]
Did the deceased breach her moral duty to her son? [35]
The law applicable to adult children claimants [35]
Peter’s claim [44]
The parent-child relationship [49]
Peter’s contributions and his mother’s promise [62]
The deceased’s promise [73]
Past conduct [83]
Conclusion [91]
Did the deceased breach her moral duty to her grandchildren? [93]
The grandparent-grandchild relationship [93]
Sarah and Anna [98]
Raven [99]
To what extent do the terms of the Will need to be altered
to remedy any breach? [110]
Result [118]
Costs [120]
[1] The deceased’s only child, Peter and his three children seek further provision from the estate of Mrs Brosnahan (the deceased) to remedy her alleged breach of moral duty in failing to make adequate provision for the claimants in her final will.1 These claims seek an acknowledgement of the familial relationships including her third grandchild omitted from the Will, and an award for the financial and non-financial contributions made by her son to the family assets.
[2] The deceased died on 10 March 2019 and her estate is represented as the defendant in these proceedings by the executor of the estate, who does not oppose the plaintiffs’ claims. The O’Conor Institute Trust Board appears as an interested party, being a charity and one of the beneficiaries of the deceased’s final will. The O’Conor Institute opposes the claims.2
[3] The executor reports that the net value of the estate is $1,870,880.39. In her final will dated 18 October 2018, together with a first codicil dated 27 November 2018 and a second codicil dated 22 January 2019 (together, the Will), the deceased left:
1 Family Protection Act 1955, s 4.
2 It is a registered charity under the Charities Act 2005.
(a)$700,000 to charity, including $100,000 to the O’Conor Institute;
(b)$200,000 to her two sisters;
(c)$100,000 to a friend;
(d)$150,000 to her three goddaughters;
(e)$200,000 to two of her grandchildren (second and third plaintiffs); and
(f)the residue to the deceased’s son, Peter. The residue currently amounts to approximately $620,880, although further liabilities are to be deducted from this amount.
[4] No provision was made for the fourth plaintiff, Raven, the deceased’s third grandchild.
[5] Under the Will, Peter receives a residue approximately worth one third of the estate on the current estimate, given that one of the charities has been disestablished. Two of his children, Anna and Sarah, each receive $100,000 being the same bequest made to the deceased’s sisters and to a friend, who died before these proceedings were issued. I note that one of the deceased’s goddaughters has also died subsequent to the issue of these proceedings. On the current values, the plaintiffs together receive approximately 44 per cent of the deceased’s estate. Approximately 50 per cent of the estate goes to charity, with the O’Conor Institute receiving approximately five per cent.
[6] The four plaintiffs claim that the deceased failed to make adequate provision for them from her estate for their proper maintenance and support, having regard to the size of the estate, other calls on the deceased’s estate, the station in life of the plaintiffs and the support and assistance given to the deceased during her lifetime. The plaintiffs ask this Court to make such provision as it thinks fit out of the deceased’s estate for the proper maintenance and support of the plaintiffs. It asks for the provision to be made out of the charities’ share of the estate.
[7] The O’Conor Institute (the Trust) opposes the claim. It says that the deceased discharged her moral duty to the plaintiffs by gifting approximately $820,000 to them and thereby made adequate provision from her estate for their proper maintenance and support. It says further that the deceased made her intentions clear and she was entitled to make the bequest of $100,000 to the Trust, given its connection to the deceased.
Background
General background
[8] The deceased and her husband, Mr Cyril Brosnahan, married in March 1950. They had one child in 1953, Peter, who is the first plaintiff in this proceeding and the beneficiary of the residue of the deceased’s estate. The deceased had significant mental health difficulties throughout her life. Soon after Peter was born, the deceased was treated at a psychiatric hospital near Dunedin. By 2016, she was found to have mild cognitive dementia. Peter describes his mother in the following way:
Although my mother presented as being a very normal person throughout her life (particularly in a social context) she was mentally fragile, impulsive and (once she was set on something) stubborn to the point of irresponsibility (by which I mean she could not be dissuaded from a decision no matter how obviously ill-advised) and seemingly unable to feel remorse for any wrong doing on her part.
[9] Over time, his mother was occasionally treated for her mental health in hospital and was on medication for much of her life. Counsel for the plaintiffs submits these psychiatric problems manifested themselves in the deceased’s day-to-day life and represented a significant challenge to her family.
[10] As an illustration of his mother’s challenging behaviour, Peter describes the family’s move to London in 1959, when his father was sent by the Government to carry out audits for New Zealand-owned entities there. Peter was sent to school in West London and on the first day, his mother took him by bus from Golders Green, requiring a change of bus to reach the school in West London. Peter was then aged six. When his mother had walked him to the school gate, she told him: “well you’ve seen how we got here, do the same but in reverse to get home”. She left without saying more. Peter describes how anxious he felt all that day at the prospect of trying to get home but did so, with the help of a concerned passenger. Often when he arrived home
from school during that time, there was never anyone there for some hours afterwards. On one occasion, he arrived home to find it was being burgled.
[11] While they lived in London, Peter describes being seriously ill with pneumonia for approximately six weeks. He was feverish and disorientated but when he woke up during the day, there was no one in the house. His mother had left him to cope, while she went to work. His mother did clerical work for an engineering firm and from the money she earned, she travelled around Europe by herself. She did not contribute to the family’s living expenses. Peter recalls an occasion when his mother decided to take a cruise to Greece, and he asked if he could travel with her. Her reply was to the effect of: “why on earth would I want you there?”
[12] Peter described feeling that his mother was disinterested in him and found her remarks, such as the one above, deeply hurtful. Subsequently, he has realised that such remarks and behaviour were a feature of her mental health but, as a child, he understood he had to be self-sufficient.
[13] After four years in London, the family moved back to Wellington. His parents owned a valuable house in Lower Hutt, which they bought when Peter was born.
[14] In 1969, Peter’s mother signed a contract for a rundown residential property in Kelburn comprising a home and flat in Easdale Street. She did so without reference to Peter’s father, Cyril, but with the expectation that he would fund the purchase. His mother brought the house in her name only. Peter describes how stressed and very anxious his father became, because the required financing was beyond the limit of the family’s finances. This ultimately proved to be true.
[15] The family could not afford to live in Easdale Street before they sold the Lower Hutt property. They rented out both the house and flat in Easdale Street and as a consequence of the financial constraints, his father, mother and Peter had to work weekends and nights doing commercial cleaning for approximately four years. Peter describes this as very tiring work for his father, who did this after working in his fulltime employment. Peter had academic obligations during this time, initially while
at school and subsequently when he started university in 1971. The Lower Hutt property was finally sold on 16 June 1971.
[16] By the time Cyril retired in 1982, however, the Brosnahans were in strong financial circumstances. They were able to buy a holiday home in Waikawa and extend the Kelburn house. Peter says he was on excellent terms with both his parents and had regular contact with them.
[17] In the 1980s, Peter had three children with his first wife. One of those children died from cot death very early on. The other two children, Sarah and Anna, are the second and third plaintiffs in this proceeding. Peter had another child, Raven, to another relationship in 1993. Raven is the fourth plaintiff in these proceedings.
Peter’s promise
[18] Cyril was diagnosed with cancer in 1991. Peter says that in the lead-up to his death, he and his father discussed how Peter would look after his mother once Cyril passed away. It was clear his mother would be financially secure. In addition to the Kelburn and Waikawa houses, the Brosnahans owned property at Peka Peka (bare land) and another house in Waikanae. His mother also had rights to Cyril’s pension funds.
[19] Nevertheless, in the months leading up to his death, Cyril expressed his worry that Peter’s mother would not cope on her own and her mental fragility worried him. He asked Peter to look after her, to advise her, and to help her if that was needed. Peter describes his father asking him to make allowances for her mental state and to include her in his family life. Peter promised him that he would do all of that.
[20] Cyril passed away in October 1992. Not long after Cyril’s death, his mother gave Peter her power of attorney, apparently on Cyril’s advice. About two years later, Peter received an unexpected letter from his mother’s lawyers revoking his power of attorney. Peter wrote to her, saddened that there may have been some grievance which may have caused her to take that action, as there had been no discussion or reason given. He reminded her of the assistance he had given her since Cyril’s death and his
on-going concern for her. His mother never responded to his letter. Peter describes this as an example of the classic, impulsive behaviour that his mother often displayed.
Events after Cyril’s death
[21] In the years that followed, his mother bought and sold a number of properties. She sold the land near Peka Peka and the Waikawa property. She bought two other properties in Waikanae. In 2013, she bought another property in Wellington on the Terrace.
[22] From time to time after Cyril’s death, Peter describes how his mother would ask him to pay her debts, which she told him were tradesman’s invoices for work on the Kelburn property. He says he paid them regularly, because she was his mother and he wanted to live up to the promise he had made his father to always look after her. He was comforted by the thought that she had promised him frequently that her estate would “go to you and your kids”. He estimates such payments exceeded $100,000 by a significant margin. Peter says he later learned that many of these payments were not for the Kelburn property, but for an extension on one of the properties she had purchased in Waikanae, in Tui Crescent.
[23] In 2008, Peter’s child, Anna, was attending university in Wellington. Peter rented a room at the Kelburn house for Anna from his mother at above market rate. His mother at that point was living both in the Kelburn and Tui Crescent homes.
[24] The Kelburn house was ultimately sold in June 2016 for close to $1.5 million. That same year, his mother was admitted to Kenepuru Hospital in Porirua. She was 86 years old. She was given a mental assessment and found to have a Montreal Cognitive Assessment score of 23 out of 30, which meant she had mild cognitive impairment. On leaving the hospital, Peter encouraged his mother to move to Waitotara, to where his other daughter, Sarah, was living. Sarah is a registered nurse and he thought Sarah could look after his mother. His mother decided against that idea and moved back into Tui Crescent. In her remaining years, she bought two further properties in Waikanae.
[25] In terms of the relationship between the deceased and the four plaintiffs, she remained on loving terms with her son and his first two children throughout her life. She became aware of her third grandchild in 2003, when the child was 10 years old. While there was some contact between Raven and the deceased, it appears the deceased did not take much interest in Raven.
The wills
[26] The deceased executed eight wills over her lifetime. A brief summary of each details the changes:
(a)The first will is dated 1 April 1987, in which Peter was entitled, in the event of Cyril predeceasing him, to receive the deceased’s entire estate.
(b)The second will is dated 30 March 1993, one year after Cyril’s death. The beneficiary of this will is the Birchlea Trust, the beneficiaries of which are Peter and his children.
(c)The third will is dated 7 October 2004, in which the deceased made a number of relatively modest bequests to friends and family but left Peter half the residue, with the remainder being divided among family and charities.
(d)The fourth will is dated 11 October 2004. It appears as a correction to the third will. It is substantially the same except that Peter’s half share in the residue is given to the Birchlea Trust.
(e)The fifth will is dated 22 November 2007, in which the deceased made a number of fairly modest bequests to friends and family and gave half the residue to the Birchlea Trust with the remainder being divided among family and charities.
(f)The sixth will is dated 31 August 2015, in which the deceased’s specific bequests to charities, family and friends, including Peter, became much
more substantial. In this will, Peter is entitled to the Terrace property. The residue of the will went to charity.
(g)The seventh will is dated 21 September 2018, and leaves $1,300,000 to friends, family and charities with the residue to either the Birchlea Trust or to Peter.
(h)The eighth and final will (the Will) is dated 17 October 2018. There are two codicils to this Will. The overall effect of the Will and the codicils was to create $1,350,000 worth of specific bequests with any residue to either the Birchlea Trust or Peter. This Will has a memorandum attached explaining why substantial bequests were made to charities and other family relations, that her son was “financially independent,” and that she was aware a Family Protection Act claim had a good chance of being successful. As mentioned, this final Will made provision for Peter and the second and third plaintiffs but left nothing to Raven.
The plaintiffs’ circumstances
[27] Peter is in his late sixties and is retiring shortly from his practice as a barrister sole. His financial circumstances are very comfortable by today’s standards, comprising interests in a $1.3 million family home, a trust holding $3 million worth of assets, and joint savings and pension entitlements of approximately $700,000. He jointly owns motor vehicles and a small boat. His claim is not a “needs based” claim, but rather that the provisions made by the deceased for him and his children are improper and in breach of her moral duty, given Peter’s support and contributions to his mother’s estate during her lifetime and particularly since his father’s death.
[28] In his updating affidavit, however, Peter records that his personal circumstances had changed since his evidence was filed in August 2019. In December of that year, he was hit by a motor car when cycling in Palmerston North. The driver of the car faced charges of careless use causing injury and Peter was hospitalised for a month, having to undergo multiple surgeries. He was confined to a wheelchair and later had to use crutches. He was unable to work to any significant degree between
December 2019 and 1 June 2020. He reassigned much of his work over this period, which has entailed a substantial loss of income. This has led to his resolve to wind down his practice with a view to retiring in “the next year or so”.
[29] The second, third and fourth plaintiffs’ are the deceased’s grandchildren. Sarah and Anna each received bequests of $100,000 but Raven was omitted from the deceased’s Will. Anna and Sarah have modest assets, including a mortgaged property each. Their position in this hearing was that their claims were filed in support of their father’s claim but in the event that their father’s claim was unsuccessful, their claim should be increased.
[30] Raven, however, is a child of another relationship and is in different circumstances to that of her half-sisters. Raven does not own any property, although she currently earns a good salary working in the mines in Western Australia. She has limited savings and a small compulsory superannuation entitlement.
The Will and value of the estate
[31] As noted, the net total of the estate as at the date of hearing was $1,870,880 with a provisional current estimate of the residuary estate for Peter of $620,880. There will be further liabilities of administration and legal costs to be deducted.
[32] Of the $700,000 bequests to the seven charities, one of those gifts of $100,000 to the Nazareth Rest Home failed, because the charity was disestablished. At the time of her last will, the deceased had made monetary bequests totalling $1.35 million, leaving the residue, necessarily unquantified, to Peter.
The issues
[33] I propose to deal with the four claims, by grouping the grandchildren’s claims together and dealing with Peter’s claim separately, as follows:
(a)Did the deceased breach her moral duty to her son Peter?
(b)Did the deceased breach her moral duty to her grandchildren?
(c)If so, to what extent do the terms of the Will need to be altered to remedy any breach?
[34] In determining those issues, I deal with the relevant legal principles applicable to each of the respective class of claim.
Did the deceased breach her moral duty to her son?
The law applicable to adult children claimants
[35] Children of a deceased may make a claim under the Family Protection Act 1955 (the Act).3 Section 4(1) of the Act provides:
(1) If any person (referred to in this Act as the deceased) dies, whether testate or intestate, and in terms of his or her will or as a result of his or her intestacy adequate provision is not available from his or her estate for the proper maintenance and support of the persons by whom or on whose behalf application may be made under this Act, the court may, at its discretion on application so made, order that any provision the court thinks fit be made out of the deceased’s estate for all or any of those persons.
[36] By virtue of s 4, the Court has a discretionary power to intervene in the terms of a deceased’s will if adequate provision is not available for the “proper maintenance and support” of the claimants.
[37] Both Counsel drew my attention to the oft-quoted passage from Little v Angus, in which the Court of Appeal summarised the approach to a family protection claim:4
… The inquiry is as to whether there has been a breach of moral duty judged by the standards of a wise and just testator or testatrix; and, if so, what is appropriate to remedy that breach. Only to that extent is the will to be disturbed. The size of the estate and any other moral claims on the deceased’s bounty are highly relevant. Changing social attitudes must have their influence on the existence and extent of moral duties. Whether there has been a breach of moral duty is customarily tested as at the date of the testator’s death; but in deciding how a breach should be remedied regard is had to later events.
3 Family Protection Act 1955, s 3(1)(b).
4 Little v Angus [1981] 1 NZLR 126 (CA) at 127, an approach upheld in Fisher v Kirby [2012] NZCA 310, [2013] NZFLR 463, at [107]. In the latter case, the deceased left all but $121,000 of her $3.7 million estate to her husband’s nieces and nephew, thereby substantially disinheriting her three children.
[Emphasis added]
[38] It has been observed that in the case of adult children capable of supporting themselves, the courts have progressively moved from an attitude of reluctance to make substantial provision for such children, to a point in 2002 where orders granting lump sums or a share of the capital of the estate were freely made.5 That trend was halted by the three Court of Appeal cases of Williams v Aucutt,6 Auckland City Mission v Brown,7 and Henry v Henry.8 Those cases were viewed as endorsing the approach taken in Little v Angus and were considered to have adopted a more conservative approach to claims.9
[39] The Court in Henry however, in discussing Williams and Auckland City Mission, reinforced that “conservative” means simply “no more than the minimum necessary to make the adequate provision.”10
[40] It may be helpful at this point to provide a summary of the approach in the above cases as follows:
(a)Mere unfairness is not sufficient to warrant disturbing a testamentary disposition. The Court is not authorised to rewrite a will merely because it may be perceived as being unfair to a family member. It is
5 Bill Patterson (ed) Law of Family Protection and Testamentary Promises (4th ed, LexisNexis, Wellington, 2013) at 153.
6 Williams v Aucutt [2000] 2 NZLR 479 (CA). In that case, the claimant daughter of the testatrix was well off and had been left a legacy of $50,000, which was about five per cent of her mother’s estate. The residue was left to her sister, who was in financially strained circumstances. The Court of Appeal found that given the large size of the estate, which it seems the testatrix had not appreciated, the provision for the claimant was insufficient to recognise her importance in the overall life of her mother. It gave an additional legacy of $50,000 to remedy the breach, amounting to a total legacy of approximately 10 per cent of the estate.
7 Auckland City Mission v Brown [2002] NZCA 33, [2002] 2 NZLR 650. In that case, all parties agreed that the deceased had breached his moral duty to his daughter by leaving her only $190,000 out of his $4.6 million estate. The daughter was not well off, but nor was she in financial need. She had a house with a mortgage and a few other assets. Overturning the High Court’s decision to award the claimant $1.6 million (about 35 per cent of the estate), the Court of Appeal ordered
$850,000, a sum equivalent to just under 20 per cent of the estate, to be provided to the adult daughter. It held that “a wise and just testator would have ensured that [the claimant] had the means to acquire a more substantial house for the family debt free and to clear the loan [on the existing house], together with a sum to supplement their business income and provide a reasonably substantial contingency fund.” She was the deceased’s only living daughter.
8 Henry v Henry [2007] NZCA 42, [2007] NZFLR 640.
9 Patterson, above n 5, at 30–32.
10 Henry, above n 8, at [54].
not for the Court to be generous with the testator’s property beyond ordering such provision as is sufficient to repair any breach of moral duty. It must be shown in a broad sense that the applicant is in need of maintenance and support.
(b)However, an applicant need not be in necessitous circumstances. “Proper” denotes something different from “adequate” and the amount to be provided is not to be measured solely by the need of maintenance which would be so if the Court were concerned merely with adequacy.
(c)Support and maintenance are different. “Support” is used in its wider dictionary sense of “sustaining, providing comfort”. A child’s path through life is supported not simply by financial provision to meet economic needs and contingencies but also by recognition of belonging to the family and of having been an important part of the overall life of the deceased. Such support may take the form of lifetime gifts or a bequest of family possessions.
(d)The size of the estate and the existence of any other moral claims on the testator’s estate are highly relevant and due regard must be had to ethical and moral considerations, and to contemporary social attitudes as to what should be expected of a wise and just testator in the particular circumstances.
(e)A different approach may be justified depending on the size of the estate.
(f)Beneficiaries under the will do not have to justify the share which they have been given. So long as the testator has provided a sufficient sum in the will to satisfy their moral duty under the Act, a bequest to charity is fitting and the testator’s wishes should prevail.
(g)A charitable beneficiary under a will is not required to take a neutral stance. In some circumstances, for example, where competing
claimants can be expected to test the respective claims, it may be appropriate for the charities to simply abide by the decision of the Court and provide relevant information as to the testator’s connection with and intentions in benefiting the charities. In other circumstances, for example, where there is no other beneficiary defending the will, it may be entirely appropriate for the charity to support the will and test the claims.
(h)Where a breach of moral duty is established, the award should be no more than is necessary to repair the breach by making adequate provision for the applicant’s proper maintenance and support. In cases of financial need, the amount necessary to remedy the failure to make adequate provision will be able to be determined with greater precision than in cases where the need is more of a moral kind.
[41] The Court of Appeal revisited the position more recently in Fisher v Kirby, by endorsing “the well settled approach” to claims as follows:11
[120] The decisions of this Court from and including Little v Angus are properly viewed as a timely reminder that awards should not be unduly generous. But, in our view, neither should they be unduly niggardly, particularly where the estate is large and it is not necessary to endeavour to satisfy a number of deserving recipients from an inadequate estate. A broad judicial discretion is to be exercised in the particular circumstances of each case having regard to the factors identified in the authorities.
[42] The Court confirmed that the question still remains whether there has been a breach of moral duty judged by the standards of a wise and just testator or testatrix and, if so, what is appropriate to remedy that breach.12
[43]I turn then to consider the evidence and the law in relation to Peter’s claim.
Peter’s claim
[44] All parties agree that Peter is financially secure. It is common ground, however, that financial need is not the only, or indeed the primary, circumstance
11 Fisher v Kirby, above n 4.
12 At [118].
relevant to a testator’s moral duty. Moral and ethical factors are equally important in assessing whether the testator has discharged her moral duty to her children and/or grandchildren. Such factors include any contributions made by a claimant to building up the estate of the deceased, giving personal or practical assistance to the deceased, whether the estate has been left otherwise to charities or there are competing moral claims, whether a claimant has been neglected by the testator, and whether there were unfulfilled intentions or promises to provide.
[45] As noted, Peter’s claim for further provision is for support in the form of recognition, rather than maintenance. His Counsel submits that Peter’s contribution to the estate is clear and substantial and entitles him to a special claim on the deceased’s bounty.
[46] Mr Palmer submits on behalf of the O’Conor Institute Trust (the Trust) that the deceased had adequately provided for the plaintiffs’ maintenance and support by leaving one third of her estate to Peter, as well as gifting $100,000 each to Sarah and Anna. He submits that while there was no gift to Raven, it did not materially change the position, because the deceased had discharged her moral duty to the plaintiffs and was entitled to leave the balance of her estate to the chosen beneficiaries under the Will, including the Trust. The Trust drew the Court’s attention to the work that it does and the benefit to the public that results from donations to charity. Although not obliged to justify the share that the Trust has been given in the Will, Mr Palmer submitted the deceased had a connection to the “O’Conor Home” that is owned and operated by the Trust.
[47] Mr Palmer points to the final Will being consistent with the 2015 will and says further, that there is nothing out of the ordinary in this case to justify greater distributions to the plaintiffs. He says, there is no evidence of any extraordinary needs financial or otherwise for Peter.
[48] From the evidence and submissions, three distinguishing factors emerge. The first is the nature of the parent/child relationship and the moral duty of support owed by the deceased to her only son; the second concerns Peter’s contributions to the family
asset base and the deceased’s testamentary promise to reward him; and the third is the aspect of the deceased’s past conduct towards him.
The parent-child relationship
[49] In Flathaug v Weaver, the Court of Appeal reinforced the primacy of the parent-child relationship and the moral obligation attaching to it.13 The Court said:14
The relationship of parent and child has primacy in our society. The moral obligation which attaches to it is embedded in our value system and underpinned by the law. The Family Protection Act recognises that a parent’s obligation to provide for both the emotional and material needs of his or her children is an ongoing one. Though founded on natural or assumed parenthood, it is, however, an obligation which is largely defined by the relationship which exists between parent and child during their joint lives.
[50] Peter gave evidence he had a loving relationship with both his parents throughout his life. They provided for his maintenance and support while he was growing up; he lived with them throughout his university studies; his daughter lived with the testator throughout her studies; and Peter himself stayed in his mother’s property while he worked in Wellington. Peter involved his mother in all of the family’s celebrations and she stayed with his family regularly.
[51] In Fisher v Kirby, the Court of Appeal reinforced the primacy of the parent- child relationship and held that the primary obligation of the deceased mother, Irma, was to her children over that of her nephews and nieces. The Court specifically noted that when:15
[W]eighing the moral duty owed by a parent, the Court will ordinarily conclude that the duty to make adequate provision for one’s children should take priority over any duty to nieces and nephews.
The distinction is recognised in the Act, “reflect[ing] Parliament’s intention that the ability of the Court to override the usual freedom of testamentary disposition is limited to claims by close family members.”16
13 Flathaug v Weaver [2003] NZFLR 730 (CA).
14 At [32].
15 Fisher v Kirby, above n 4, at [125].
16 At [126].
[52] It is significant in this context that only-children have historically been treated by the courts more generously. Having undertaken a survey commissioned by the Law Commission, by Nicola Peart reported:17
An interesting feature was the way only children were treated by the Courts. Special significance appeared to attach to the fact that the applicant was the only child of the deceased. The absence of other competing moral claimants did not enhance testamentary freedom, but rather increased the moral duty to the only child … they generally received at least one-third, but more often something between one half and three quarters, of the estate.
[53] As noted, the Courts have drawn a distinction between support and maintenance. “Support” is used in its wider dictionary sense of “sustaining, providing comfort”. As the Court of Appeal in Williams v Aucutt explained, a child’s path through life is supported not simply by financial provision to meet economic needs and contingencies but also by recognition of belonging to the family and of having been an important part of the overall life of the deceased.18 Such support may take the form of lifetime gifts or a bequest of family possessions. The Court held:19
… Where there is no economic need it may be met by a legacy of a moderate amount. On the other hand, where the estate comprises the accumulation of the family assets and is more than sufficient to meet other needs, provision so small as to leave a justifiable sense of exclusion from participation in the family estate might not amount to proper support for a family member.”
[54] There is no dispute that Peter was an integral part of the family, supporting both his mother and father, working with both of them in his youth as a commercial cleaner to meet the financial commitments his mother incurred by purchasing the Easdale Street property. These facts have been set out at [14]–[15]. While at school and then at university, Peter lived at home with his parents and worked, thereby contributing to the family’s mortgage commitments. When he was older, he paid his mother above market rent for his daughter to live with her and he too, would pay her approximately $150 a night when he sometimes stayed at the Kelburn home, to financially assist her.
17 Nicola S Peart “Awards for Children under the Family Protection Act” (1995) 1 BFLJ 224 at 226.
18 Williams v Aucutt, above n 6, at [52].
19 At [52].
[55] I consider there is a distinguishing factor about the parent-child relationship in this case, and that is the commitment and promise Peter made to his dying father, that he would look after his mother as his father had requested. The facts surrounding the promise are set out at [18]–[20].
[56] I accept the evidence that Peter gave about his commitment to that promise. He gave advice to his mother on properties she might buy, helped her out with tenants at her various properties, met her debts owing to tradesmen who did work on the various properties she bought and sold, and included her in his family life. He describes his mother coming to stay at Christmas and other occasions, insisting that he pay her bus fares and joined with them in family celebrations. She had a close relationship with Peter and his children, Sarah and Anna, in particular.
[57] Both Sarah and Anna gave evidence of the families interaction with the deceased and how inclusive their father was of the deceased in their family life. Anna describes having a lot more to do with her grandmother than is common in other families. When Cyril died, she describes Peter being very anxious to include the deceased in their family life. As a consequence, the deceased stayed with the family at the family home at “Birchlea” and later at Waitotara, a small rural holding near Waverly. She describes that although her mother and father separated during her childhood and had a shared custody arrangement, her mother worked hard to ensure that her relationship with the deceased carried on unchanged, which it did. Peter did the same. This meant that Anna and Sarah spent time with the deceased in the Easdale Street home or at her holiday home at Waikawa Beach. The deceased came to stay at Birchlea during the hunting season and at Christmas time, birthdays, important family occasions and “sometimes, simply because she felt like it”. When Anna and her husband moved onto the Waitotara property in February 2015, the deceased continued to come and stay with them, where she had her own room for her clothes and personal items.
[58] Sarah confirmed Anna’s recollection and confirmed also that she supported Peter’s proposal that the deceased should come back to Waitotara where Sarah could look after her, following the deceased’s fall at her home in Tui Crescent. She was concerned that the deceased could not continue to cope living at Tui Crescent because
in 2016, the deceased was virtually bedridden and because of the likelihood she would fall amid all the clutter in the property, resulting from the deceased’s habit of hoarding. The deceased declined to move.
[59] Putting to one side aspects of his mother’s conduct, which I deal with below, Peter assisted his mother with tenants and neighbours with whom she frequently fell out. Such support, assistance, comfort and companionship has been recognised as a valuable contribution in family protection claims, particularly where the child has provided consistent and out of the ordinary support, at some sacrifice to themselves.20
[60] In this case, Peter was the only child and the support requested of him by his father fell on his shoulders only. There is no evidence of Peter ever refusing to assist or help his mother, even in trying circumstances, when his mother did not follow his advice.
[61] But the evidence in this case does not rest there. In addition to his general support and non-financial contributions in his earlier life, Peter made financial contributions to what was an accumulation of the family asset base.
Peter’s contributions and his mother’s promise
[62] Counsel for Peter, Mr Manktelow submits that Peter’s financial contributions to building up his mother’s estate, together with his practical and personal assistance given to her, particularly after Cyril’s death in 1992, were insufficiently recognised by his existing entitlement to the residue. Counsel relies on the following passage from the Australian High Court decision of Goodman v Windeyer:21
One of the circumstances that must be considered in deciding upon the deserts of a claimant to a testator’s estate, and in determining whether proper maintenance has been provided, is the manner in which that claimant has conducted himself or herself in relation to the testator. If the claimant has contributed to building up the testator’s estate, or has helped him in other ways, that may give the claimant a special claim on the testator’s bounty.
20 See, for example, Re Hardie [dec’d] [2002] NZFLR 229 (HC) and Hayes v Guerin [2010] NZCA
148. In Re Hardie, the Court recognised that the testator’s sons had provided “extraordinary” support to their mother after their parents separated. They assumed the testator’s responsibilities during their youth and early adulthood at some sacrifice to themselves.
21 Goodman v Windeyer [1980] HCA 31, (1980) 144 CLR 490 at 497.
[Emphasis added]
[63] Mr Palmer submits that Peter’s financial contributions are not recorded or corroborated with documents and it is reasonable to conclude that no repayment was expected. He submits that, in any event, the bequest to Peter can be considered as generous, even taking into account his financial contributions.
[64]The evidence upon which Peter relies can be summarised as follows:
(a)While at school and in law school, Peter undertook weekend cleaning jobs over four years in order to help service the mortgage on the Kelburn family home. He did so because of the straightened family finances as a result of the purchase of the Easdale Street property.
(b)Peter advised his mother on the numerous property transactions she undertook in the years after Cyril’s death, even if that advice was frequently ignored.
(c)Peter helped his mother when she had problems with her tenants at the Kelburn property and other rental properties she owned.
(d)When Anna was at university, Peter paid above market rent to his mother for Anna and her friend to rent a room at the Kelburn property. Similarly, when Peter stayed in Wellington he would pay his mother approximately $150 a night to stay in the Kelburn property, to financially assist her.
(e)Peter and his family cared for and included the deceased in their family unit, despite her frequent frustrating, impulsive, erratic and harsh behaviour.
(f)Peter made payments to or on behalf of his mother between 1992 and 2009. These were primarily tradesman’s accounts for maintenance and renovation work on the deceased’s property but also covered significant invoices for private hospital care.
(g)His mother promised Peter frequently, and particularly when she was seeking financial assistance between 1992 and 2009, that her estate would go to Peter and his children.
(h)The estate is an accumulation of family assets. It was established primarily by Cyril, who was his family’s primary bread-winner.
[65] In describing the nature of the payments he made, Peter says that the accounts usually arrived from his mother by post, “in a thick envelope with a demand that I pay the invoices”. He describes delegating these payments to his then personal assistant to be paid.
[66] His personal assistant, Ms Benge, provided an affidavit corroborating Peter’s evidence. Ms Benge also confirms that letters from the deceased, in handwriting that Ms Benge recognised, invariably came in thick envelopes “which turned out to be stuffed full with invoices”. When Peter gave the accompanying bundle of invoices to Ms Benge to arrange payment, they were made by cheque and each time, it “usually meant I had to pay invoices totalling something between $3,000 and $8,000”. She confirms that these letters from the deceased did not arrive every month “but they did arrive with great regularity so that there was something of a routine about what occurred”.
[67] Ms Benge was not able to provide an accurate figure of the total of the invoices, but she expresses her view that she would be surprised if it were not over
$100,000 and possibly significantly more. This accords with Peter’s estimates that the payments would have exceeded $100,000 by a significant margin. If such payments reached the realm of $150,000, over the passage of time, between the years of 1992 and 2009, those payments would be worth between $293,000 and $882,000, if the reserve bank inflation calculation for housing was applied.
[68] In his updating affidavit, Peter had located invoices from two private hospitals enclosed with a letter from his mother requesting he place $5,000 into her account in 2004 and a further $7,800 in 2007 to meet the expenses from her respective surgeries.
[69] I also note the evidence of Ms Benge, who recalls that, from time to time, she had to read the deceased’s covering letters to ensure that her instructions were being carried out correctly. Of the tone of those letters, Ms Benge says this:
I recall being struck by the demanding tone of the letters. I recall thinking that it seemed a very curious way to treat a son and I cannot imagine writing to my son in such a way.
[70] There are two cases where the Courts have specifically taken into account the contributions of the adult claimant children. In Fisher v Kirby, the deceased left all but $121,000 of her $3.7 million estate to her husband’s nieces and nephew, thereby substantially disinheriting her three children.22 Two of the applicant children had contributed to their mother’s estate by consenting to her Family Protection claim against their late father’s estate. Her son had also made a major contribution to the family farm where his mother lived and from which she drew most of her income. These contributions were significant factors in the Court’s decision to make orders in favour of the applicants. The High Court awarded the deceased’s daughter $700,000, her son $600,000 and her natural son $350,000. The nephew and nieces’ appeal against the quantum awarded to the children was dismissed and the deceased’s son’s cross appeal against quantum was successful. His award was increased to $500,000, principally for reasons of financial need. Together, the children’s claims amounted to nearly 50 per cent of the overall estate, bearing in mind that some of that sum was to recognise John’s financial need.
[71] The other example is a case referred to by the plaintiffs, Worboys v Jones, where the testator died leaving his partner a half share of the family house, his chattels and car, and the option of purchasing the other half of the house, togethering equating to $95,000. He also left her an insurance entitlement in the amount of $93,000. His daughters received the residue of his estate, amounting to about $32,000 each. The whole estate, including the survivorship benefits, amounted to about $340,000. The Family Court held that the testator had breached his moral duty to his daughters and the amount required to repair the breach was approximately equal to one half of the total net value of the estate as it would have been if the testator had not set up various
22 Fisher v Kirby, above n 4.
bank accounts and the insurance entitlement which his partner took by survivorship.
This was upheld on appeal to the High Court.23
[72] In light of the independent evidence from Ms Benge and the documents and the letters annexed to Peter’s second affidavit, I am unable to uphold the Trust’s submission that there was no corroborating evidence of Peter’s payments. Plainly, Peter made a substantial financial contribution over many years, which, in my view is not outweighed by the bequest to him of the residue.
The deceased’s promise
[73] In this case, there is yet a further distinguishing feature and that is the deceased’s promise. In meeting the payments that his mother requested, Peter says that he made those payments for three principal reasons. The first and primary reason was simply that the deceased was his mother. The second is that he was concerned to honour the promise he had made to his father, that he would look after his mother. But the third was that Peter was comforted by the thought that his mother promised him frequently “and particularly when she was seeking my financial assistance between my father’s death in 1992 and 2009, that her estate would ‘go to you and your kids’ or words to similar effect after her death.”
[74] Peter’s evidence of his mother’s promise is corroborated by his daughter, Anna. She says she was aware that the deceased was receiving money from her father. Anna says that the deceased had an expectation that Peter would give her funds when she asked for them and that the deceased was very aware that Peter had promised his father to look after to her. Anna had found among her papers one of the deceased’s requests for money for balustrading and a repair of a deck on one of her properties. The deceased had also asked Anna not to tell Peter that she was using much of his money on an extension to Tui Crescent, rather than maintenance work at Easdale Street, which is what she had told Peter. Anna recalls that sometime, shortly after 2009, the deceased sent her a copy of Cyril’s will in which he had left all his property to her or, in the event she predeceased him, to Peter. The copy of Cyril’s will was annexed to Anna’s affidavit. She says she had the impression from the deceased that her Will was in the
23 Worboys v Jones [2004] NZFLR 360 (HC).
same terms as Cyril’s will and that her estate would go to “her issue.” Anna puts it this way:
As I recall it, [the deceased’s] argument was that my father should give her more money because he (together with my siblings and I) would eventually get her entire estate.
[75] Taking into account all of the evidence before me, I consider that the deceased’s promise is in the nature of a testamentary promise, that Peter and his family would either receive all or a substantial portion of her estate. That said, Peter has not claimed under the Testamentary Promises Act. Nor does he seek to claim the whole of his mother’s estate. The fact that the estate is an accumulation of family assets, contributed to over the years by Peter in the form of financial payments, advice and assistance is, however, highly relevant.
[76] I note that in the Law Commission’s Preliminary Paper 24 on Succession Law: Testamentary Claims, the Commission proposed that a “contributor”, defined as any person who, during a will-maker’s lifetime, contributes a benefit (e.g. money, property, work or services) to the will-maker, should have a specific statutory claim.24 The Law Commission ultimately recommended to the Government in August 1997, that “adult independent children should have a claim only in respect of valuable benefits they have conferred on a parent during the parent’s lifetime.”25
[77] Although the Law Commission’s recommendations were not implemented, it appears that those recommendations were based largely on the way in which the Courts had recognised that such contributions have a special claim on the testator’s bounty. Nicola Peart observed that while a claimant’s financial circumstances are important in a family protection claim context, other factors have assumed greater significance in the Court’s thinking:26
The relationship of applicants with their deceased parent, for example, has become an important factor: if they had been dutiful, or assisted their parent in some way, then this increases their moral claim.
24 Te Aka Matua o te Ture | Law Commission Succession Law: Testamentary Claims (NZLC PP24, 1996) at [288].
25 Te Aka Matua o te Ture | Law Commission Succession Law: A Succession (Adjustment) Act, (NZLC R39, 1997) at [72].
26 Nicola S Peart “The Direction of the Family Protection Act 1955” [1994] NZ Recent Law Review 193 at 205.
[78] The deceased gave reasons for her testamentary dispositions in her Will. These were explained in the “Statement” accompanying her Will. In terms of the bequest to Peter, she said:
The Family Protection Act has been explained to me. I am providing the residue of my estate to my son Christen’s [Peter’s] trust. He is financially independent and has a good career and income and has no need for financial support from me. I believe the charities I have chosen have a greater need for my money and they are all worthy causes. I also wish to provide directly for my sisters and my granddaughters as my son is wealthy in his own right. I acknowledge that as I am leaving substantial money bequests in my Will that my son, Christen, and my granddaughters (if Christen has died before me) would likely make a claim against my estate for a share or larger share under the Family Protection Act 1955 and there is a good chance a claim would be successful. Such a claim (even if unsuccessful) will result in significant costs to my estate and time delays in the administration. I fully understand the likelihood of a claim being made against my estate and confirm that despite the risks involved in structuring my Will in this manner, I wish to proceed to execute my Will as I have drafted it.
[79] It is evident from the above Statement that the deceased was very aware that, in leaving such substantial money bequests totalling $1.35 million to her sisters, her friends, her goddaughters and charities, she was not giving priority to her closest family members and that a Family Protection Act claim was likely. She proceeded nonetheless.
[80] I make the following observations. It seems unlikely, in my view, that the deceased knew the potential value of the residue that Peter would receive, given that her two properties had not been realised at the time of making her Will. She did not give consideration to a specified amount, if any, to be received by Peter but left him the residue, whatever that amounted to.
[81] Further, the Statement reinforces that the deceased knew that there was a good chance a claim would be successful. Such knowledge may have been acquired from legal advice at the time of making her final Will or may have been a recognition that the deceased knew she was in breach of her frequent promises to Peter, when seeking his financial assistance from 1992 to 2009, that her estate would go to him and his children. Plainly, there can be no certainty as to the basis for her acknowledgment.
[82] However, in the absence of any further explanation, I accept the inference, which Peter has drawn from the Statement, that his mother knew she was not fulfilling her moral duty to him or his daughters. Further, I tend to the view that, although mildly impaired at the time of writing her Will, the deceased was cognisant of the fact that she “owed” Peter for his financial contributions, for which she had promised him future inheritance.
Past conduct
[83] The third factor is the past behaviour of the deceased. Where a testator has been in a position during their lifetime to do better for an applicant than has in fact been done, the courts have been inclined to treat the moral claim of the applicant as enhanced by a duty on the part of the testator to make up for those past neglects. Instances in which the courts have recognised a testator’s neglect of a claimant as justifying a further award from the testator’s estate have generally been concerned with sexual or other abuse of the claimant.27 Although there appears to be no reason the principle should not extend beyond the area of such abuse, such cases are likely to be rare and to arise only in circumstances where the deceased had a clear duty to intervene and failed to do so.28
[84] Peter’s upbringing was not conventional. The erratic and inexplicable behaviour by his mother towards Peter, as in London when he was a very young child, or later when she unilaterally dismissed him as her attorney or demanded financial assistance, appears harsh and lacking in empathy. However, this can be attributable to the mental health the deceased suffered.
[85] In Montgomerie v Public Trust, the deceased was found to have breached his moral duty to his sons by leaving his estate to charities.29 The estate of around
$125,000 was too small to provide for the charities as well as the sons. They were in modest circumstances and had shown their father great love and support despite his
27 See Kinney v Pardington [2019] NZHC 317; Re A (1988) 4 FRNZ 668 (HC); and Re Estate of Pauline [2012] NZHC 1830, [2013] NZFLR 99.
28 Patterson, above n 5, at 73.
29 Montgomerie v Public Trust HC Christchurch CIV-2007-409-001081, 17 August 2007.
“irascible” and harassing behaviour towards them. The estate was divided between the two sons.
[86] In this case, there are a number of factors which point to the difficult and unfeeling conduct displayed by the deceased towards her son. These were accepted, both by Peter and his father, as being indictive of the deceased’s mental health problems. Both showed compassion towards her and both accommodated her impulsive and erratic property purchases as being part of the family’s life and asset base.
[87] These facts have been traversed in the earlier part of this decision,30 but in brief, the following factors are relevant:
(a)Both Cyril and Peter recognised that support was required for the deceased, because of her erratic and impulsive behaviour. It underlined the reason for Cyril to request Peter to promise to assist his mother.
(b)The deceased’s harsh and hurtful behaviour towards Peter, as described in the family’s sojourn in London, where Peter, as a young child, was made to realise that he had to be self-sufficient.31
(c)Despite giving her power of attorney to Peter and asking for his advice, the deceased withdrew her power of attorney and did not accept the advice provided.
(d)As an indication of her erratic behaviour, Peter was asked to help when the deceased had problems with both her tenants and neighbours at Easdale Street and the other rental properties she owned. For example, Peter observes that:
My mother had difficulty getting along with people. She had numerous disputes with her neighbours. This included disputes about fencing, trees and I recall a difficult[y] with the neighbours at Easdale Street about my mother’s desire to build an extension to her property.
30 See [8]–[17].
31 See [10]–[12].
The antagonism that his mother caused meant Peter spent “a lot of effort on my part to smooth things over”.
(e)In asking Peter to meet the invoices for work on her properties, it transpired his mother was not entirely truthful about the purpose for the invoices. Believing that the payments were to maintain the Easdale Street property, Peter learnt that his mother was building an extension to the house at Tui Crescent, which Peter had advised her not to buy. As observed by Ms Benge, the tone of the deceased’s requests of Peter was blunt and demanding.
(f)The hurtful and wounding comments that were made about other members of the family, which do not need to be repeated here.
[88] In Re Harrison, Barrowclough CJ observed of a deceased father’s complete disinheritance of his daughter, that from a moral point of view and as a sign of contrition for his past neglect, the deceased should have made some provision.32 Most right thinking people would have condemned a father for failing to do something of that sort.33 “Contrition for past neglect” was the subject of discussion by the Law Commission in 1996 in its discussion paper.34
[89] I note the Trust’s submission that the evidence does not raise any extraordinary circumstances to justify a further claim by Peter and the mild mental impairment on the deceased’s part did not mean that the deceased was not of sound mind when she made her Will. It was not a part of the plaintiffs’ case that the deceased was not of sound mind, such that she lacked capacity. However, the examples demonstrating her conduct arising from her mental health condition have been raised in the context of the deceased’s past behaviour to her son, her promises, and her failure to acknowledge her moral duty to her immediate family.
[90] Although issues of past conduct or neglect frequently relate to torts of assault and battery or sexual abuse, here, the conduct is not of that nature and nor does it
32 Re Harrison [1962] NZLR 6 (SC).
33 At [9]. See also Peart, above n 26, at 204.
34 Te Aka Matua o te Ture | Law Commission, above n 24, at [217].
require the Court’s assessment of it. Rather, the evidence of the deceased’s “strange”, “impulsive” behaviour and her lack of empathy and insight, to my mind, inform the extent of Peter’s contributions, despite the trying circumstances and this requires recognition.
Conclusion
[91] I find that the deceased has breached her moral duty to her son. The relationship between parent and child is the most important familial relationship in our society and the moral duty owing from a mother to a child is particularly strong.35 Peter has remained a dutiful and loyal son to his mother throughout her life, notwithstanding her harsh and unfeeling behaviour towards him. He has provided her with practical and personal assistance and given her significant financial support over a sustained period of time, in often trying and testing circumstances. The majority of those payments contributed directly to the wider pool of the deceased’s assets, which comprised property from Cyril’s estate and ultimately represents an accumulation of family assets, which the deceased promised to Peter by way of inheritance. The residue of the estate does not adequately recognise Peter’s important role in the life of the deceased or his contributions.
[92]I deal with the amount to remedy the breach below.
Did the deceased breach her moral duty to her grandchildren?
The grandparent-grandchild relationship
[93] As noted, children and grandchildren may make a claim under the Act, but it is often not easy for grandchildren to establish a claim if their parent is a living child of the deceased. As this Court has put it:36
… it is often difficult for a grandchild to establish a claim where the grandchild’s parent is a living child of the deceased. As a starting point one expects that the bounty for that particular family will filter down to the second generation via the first. But it is no more than a starting point and it is easily departed from whenever there is a reason for doing so. For example, in the
35 Fisher v Kirby, above n 4.
36 Fraser v O’Grady HC Auckland M262/96, 20 May 1997 at 4, approved in Chalk v Hoare [2009] NZFLR 736 (HC) at [25].
present case the child of the deceased who was the immediate parent of the claimant grandchildren has died. In those circumstances there can be a readiness to make an award in favour of the grandchildren on a basis which in its total value may not differ greatly from the claim which the immediate child would have had.
[94] In relation to the last sentence about the size of any award, this Court has also emphasised that the grandchild’s claim must be in their own right.37 They do not step into the shoes of the parent. A sum rather less than what the deceased parent might have got is the more common outcome, if an award is made at all.38
[95] Section 3(2) of the Act provides that in considering any application by a grandchild for provision, the Court shall have regard to any provision made in favour of the grandchild’s parent(s).
[96] In Re Horton, the Court of Appeal looked at the distinction in the cases prior to the enactment of the Family Protection Amendment Act 1967, which removed restrictions on the eligibility of grandchildren to apply under the Act and said this:39
… the tenor of the decisions was that ordinarily it was not easy for a grandchild to establish a breach of moral duty, especially perhaps if the parent was living or if the grandchild was claiming in competition with a child having a family of his or her own to support; but there was no presumption against grandchildren and all the circumstances had to be considered.
The Court found that the relevant amendments did not imply any change in the basic philosophy of the Act.40
[97]From the authorities, the following principles can be gleaned:
(a)provision may be made for adult grandchildren to provide for their future needs and security in life;41
(b)the Court must consider the usual factors one considers in a Family Protection Act claim, such as the size of the estate, any competing
37 Chalk v Hoare, above n 36, at [26].
38 At [26].
39 Re Horton (dec’d) [1976] 1 NZLR 251 (CA) at 254.
40 At 254.
41 Family Protection Act 1955, s 3(2); and Re Wright (dec’d) [1954] NZLR 630 (SC and CA).
claims, and any provision made for the children of the grandchild, as well as further factors including the ability of their own parents to provide for them, the closeness of any association between the testator and the grandchildren, and the prospect of any inheritance they have from other grandparents;42 and
(c)the need for family recognition from the deceased on the basis that grandchildren are members of the extended family, or have had a close and loving relationship.43
Sarah and Anna
[98] As noted, Sarah and Anna both support Peter’s claim for further recognition from the deceased’s estate. They do not seek an increase in their award, unless Peter’s claim fails. Sarah and Anna each receive $100,000. They are in relatively stable but modest financial circumstances. They both own property. It is accepted by the claimants that the deceased was not in breach of her moral duty to either Sarah or Anna in her final Will and has appropriately recognised them both as a significant part of her immediate family. They both had a close bond with their grandmother.
Raven
[99] The circumstances are different for Raven. As noted, she is Peter’s daughter from another relationship. She has had a difficult upbringing.
[100] Raven was born in July 1993. After her birth, her mother travelled overseas, and Raven was left in the care of her maternal grandmother, who named her “Olivia Ellen”. Before she was five years old, her mother returned to New Zealand and took back custody of Raven, renaming her “Raven Lee”. Her mother married Raven’s stepfather at that time. Raven was told her natural father was dead.
42 Re Ward (dec’d) (1990) 7 FRNZ 586 (HC) at 591; Re Barclay (dec’d) [1957] NZLR 919 (SC and CA); Re Edkins (dec’d) [1995] NZFLR 454 (HC).
43 Re Ward, above n 42 at 591; and Re Ormsby (dec’d) (1990) 7 FRNZ 573 (HC).
[101] Her mother and step-father had a dysfunctional relationship. When Raven was about seven, the Department of Social Welfare (CYPFS) intervened and placed Raven in foster care. Soon afterwards, she was placed back with her maternal grandmother in whose care she remained for the rest of her childhood.
[102] When she was 10 years old, Raven learned from her maternal grandmother that her father, Peter, was alive and willing to meet her. He came down to Wellington where Raven was living with her grandmother and they met.
[103] In subsequent years, Peter paid for Raven to attend a private girl’s boarding school near Marton. During these years, Raven says she regularly spent time (including holidays and at least one Christmas) at her father’s home in Waitotara. It was there that she met the deceased. In her affidavit, Raven says:
She [the deceased] was perfectly pleasant and she came to my 11th birthday party in Upper Hutt however, beyond this, and the occasions she was Waitotara when I was there, she did not take a significant interest in me and did not otherwise acknowledge my later birthdays or initiate any additional contacts. For my part, I always felt a little awkward about my relationship with Anne because of the circumstances of my birth and upbringing.
[104] Raven has since completed a Sports Management diploma at the New Zealand Institute of Sport and now lives in Western Australia, working in the mines. Her earnings are approximately $130,000AUD. She has savings of about $45,000AUD, including her superannuation. She does not own any property or land. Her financial position is modest. As noted, Raven does not receive anything under the final Will.
[105] Mr Palmer submits that the fact that Raven has been left out of the Will is not exceptional, when it appears she did not have as close a relationship with the deceased as that enjoyed by her older half-sisters. Further, Mr Palmer submits that any award in Raven’s favour could come from the residue left to Peter, without causing a breach of moral duty to Peter.
[106] I accept that it is not exceptional to leave a grandchild out of a will44 but nor is it unusual for the courts to provide recognition for the grandparent-grandchild
44 See, for example, Carson v Lane, [2019] NZHC 3259, (2019) 23 FRNZ 359 at [123]–[126].
relationship.45 In this area too, however, the recent shift in testamentary freedom has been noted. For example, in Mulholland v McFadzean, the Court declined the grandchildren’s claim that a five per cent share of the estate was a breach of their grandmother’s moral duty to them. The estate was small, the claimants were in good health, earning a reasonable income and not in financial need. The deceased’s duty was merely to “support” them and five per cent of the estate to each claimant was sufficient.46
[107] Here the estate value is not small. I consider that in the circumstances of this case, the deceased has breached her moral duty to Raven in failing to provide for her at all, for two principal reasons. First, Raven was estranged from the family until she was 10 years old, through no fault of her own. Since then, her relationship with the deceased was limited and certainly could not be described as close. While closeness has given rise to an obligation or expectation of direct provision for the grandchild,47 recognition that a grandchild is a member of the family is also relevant.48 Even a distant relationship may create a moral duty in some circumstances. For example, in Re Colley (dec’d), the grandchildren’s very distant relationship with the testator due to their father’s own estrangement from him did not prevent a successful claim.49 In this instance, I consider the testatrix’s disinterest and disregard for Raven as a member of the family, both in life and in failing to make any provision for her in her Will despite providing for her other grandchildren, requires recognition in the form of an award, particularly as the deceased knew Raven and had contact with her. Raven was entitled to proper recognition as a member of the family. The promise the deceased
45 See, for example, Thurston v Thurston [2014] NZHC 2267, in which both the deceased’s only child and grandchildren were separately assessed and in each case the Court found that the deceased was in breach of his moral duty to make better provision for them. One of the three grandchildren was disabled, but had completed a university degree and was employed. He had no assets, but had repaid his student loan. The estate was large at $12 million and the deceased’s widow was well provided for under the will and the terms of the trust settled by the husband. She was only six years older than the deceased’s son and her entitlements would tie up a substantial amount of the trust, preventing the deceased’s son and grandchildren from benefiting from the trust. The disabled grandson was awarded a legacy of $500,000, while his two siblings were awarded $300,000 each. They too had no assets and significant student loans.
46 Mulholland v McFadzean FC Wellington FAM-2007-032-783, 2 June 2009.
47 Gore v Gallaway CA99/00, 12 March 2001; and BDM v PBM FC Wellington FAM-2007-032- 783, 21 June 2009.
48 Re Ward, above n 42; and Re Sadd FC Palmerston North FP054/071/00, 30 November 2001.
49 Re Colley (dec’d) [1994] NZFLR 750.
made to Peter that her estate would “go to you and your kids”, by definition includes Raven.
[108] Second, Raven is particularly capital poor and her financial circumstances are modest. While she earns an adequate salary, she has no significant assets or property to her name, and everything she does have she has earned entirely herself. An award is necessary to provide for her needs and security in life. I acknowledge the Trust’s submission that Peter is in a position to ultimately provide support for Raven and gift her part of the family asset base. However, there is an irony in this submission. In the same way that Peter’s children can look to him to provide them with an inheritance, so too does Peter seek a proper share of an inheritance from his mother.
[109] I find that there has been a breach of moral duty owed by the deceased to Raven and an award should be made to repair the breach.
To what extent do the terms of the Will need to be altered to remedy any breach?
[110] What is required to fulfil a moral duty is a matter of judgment. The amount of the award will depend on many factors, including the extent of the breach of moral duty, the value of the estate, competing moral claims of others, the needs of the claimant, and existing testamentary provision made.
[111]However, the more recent decisions of the appellate courts:50
…have re-emphasised what has always been understood: that mere unfairness is not sufficient to warrant disturbing a testamentary disposition and that, where a breach of moral duty is established, the award should be no more than is necessary to repair the breach by making adequate provision for the applicant’s proper maintenance and support.
In short, a broad judicial discretion is to be exercised in the particular circumstances of each case, neither being unduly niggardly or unduly generous. With those principles in mind, I consider each of Peter’s and Raven’s remedies for breach.
[112] The contest in these proceedings is between the deceased’s only child and his three daughters, and six charities, two sisters, three goddaughters and a friend. The
50 Fisher and Kirby, n 4, at [119].
plaintiffs rely on the following passage from Law of Family Protection and Testamentary Promises:51
… where assets have been left either to charity or to strangers, provided the applicant can demonstrate that the estate is insufficient to provide adequately for his or her proper maintenance and support without affecting the gift left to charity or to strangers, the Court will not be inhibited from making provision that may have the result of reducing such gift, or even of extinguishing it. Indeed, the fact that a testator has chosen to leave his or her estate to charity may well be indicative of a failure properly to recognise the moral duty he or she may owe to the applicant. Where a successful claim is made by an applicant in respect of an estate partly left to charities and partly to other members of the testator’s family, the proper course will usually be to charge the incidence of the order on the assets left to charity.
[Emphasis added, footnotes omitted]
[113]I deal first with Raven’s claim.
[114] Having regard to the authorities and the principles set out above, I consider an award of $100,000 to Raven is neither “unduly niggardly” or “unduly generous”, to remedy the breach of the deceased’s moral duty to provide adequate maintenance and support to her grandchild. Such an award will go some way to recognise Raven as a member of the family and assist in providing for her future needs and security.
[115] Turning then to Peter’s claim, I also bear in mind the caution of the appellate courts, that an award should be no more than is necessary to repair the breach of moral duty, by making adequate provision for the applicant’s proper support. Although the deceased told Peter that he and his family would receive her estate, the plaintiffs’ claims are realistic, in that they seek further provision, rather than the estate outright. However, I am not satisfied that the present bequest to Peter amounts to proper support in the circumstances of this case. Under the final Will, Peter receives the residue of his mother’s estate, which at the date of hearing was approximately $620,000, subject to further deductions being made for fees and other administrative costs.
[116] I consider that a wise and just testatrix in the deceased’s position, taking into account Peter’s contributions to the accumulation of family assets over many years and his unswerving filial loyalty, would have made provision for her only son of at
51 Patterson, above n 5, at 70–71.
least half of her estate. For clarity, I consider the appropriate award to remedy the deceased’s moral duty toward Peter is an award in the sum of $950,000, being approximately half of the estate. I note that this award is consistent with that awarded in Fisher v Kirby, where the children had made a significant contribution to the estate.52
[117] Peter’s award, together with the award to Raven and the bequests to Sarah and Anna, represent approximately two-thirds of the estate, which I consider properly repairs the breach of the deceased’s moral duty to her son and his “kids” as she frequently promised.
Result
[118]The claims by the first and fourth plaintiff succeed.
[119]The deceased’s Will is disturbed to meet the following two awards:
(a)the first plaintiff is to receive an award of $950,000; and
(b)the fourth plaintiff is to receive an award of $100,000.
Costs
[120] Counsel have not addressed the issue of costs, although the Trust indicated its wish to be heard on costs. If the parties are unable to agree on costs, Counsel are to file memoranda no more than five pages within 20 working days of this judgment.
Cull J
Solicitors:
Innes Dean Tararua Law, Palmerston North for the Plaintiffs BuddleFindlay, Christchurch for the Interested Party
52 Fisher v Kirby, above n 4.
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