Chin v Payne
[2022] NZHC 1162
•25 May 2022
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV-2021-485-350
[2022] NZHC 1162
UNDER Part 18 of the High Court Rules 2016 IN THE MATTER
of an application for an order under section 4 of the Family Protection Act 1955
BETWEEN
SANDRA CHIN
Plaintiff
AND
STEVEN PAYNE
Defendant
Hearing: 18 May 2022 Appearances:
P Chisnall and D MacKenzie for Plaintiff (by AVL) B Sheehan for Defendant (by AVL)
G Slevin for Estate (by AVL)
Judgment:
25 May 2022
JUDGMENT OF ASSOCIATE JUDGE LESTER
CHIN v PAYNE [2022] NZHC 1162 [25 May 2022]
[1] This judgment concerns a number of interlocutory applications arising from a dispute between a sister and brother concerning their father’s estate.
[2] As I have said, the parties are brother and sister, being the children of the late Donald Gordon Payne (Donald) who died on 22 December 2020. It is Donald’s estate which is in issue in this proceeding.
[3] The parties’ mother was the late Peggy Agnes Payne (Peggy) who died on 7 October 2016, leaving a Will dated 13 February 2009. Under Peggy’s Will the residue of her estate went to Donald.
[4] Mrs Chin has commenced this proceeding under the Family Protection Act 1955 (FPA) (the FPA proceeding) seeking provision from her father’s estate.
[5] Donald made a Will in 2009. He changed his Will in 2017 to appoint the defendant, Steven Payne (Steven) his sole executor and beneficiary. In a separate proceeding CIV-2022-485-33, Mrs Chin asserts Donald’s 2009 Will was a mutual Will under s 30 of the Wills Act 2007 (the Mutual Wills proceeding). Under the 2009 Will, Mrs Chin would receive assets to the approximate value of $630,000 on the basis the total value of Donald’s estate is $3,550,000. Mrs Chin says the value of the estate is more like $4,500,000 given the recent increase in the value of property. The major asset Mrs Chin would receive under the 2009 Will is a property in Johnsonville, Wellington, that she has lived in rent free since the mid-1980s. Save for paying some rates, she has not paid any rent or other outgoings.
[6] Mr Chisnall, counsel for Mrs Chin, explained the Mutual Wills proceeding was commenced as an ordinary proceeding under pt 5 of the High Court Rules 2016 (the Rules) because of uncertainty as to whether the originating application procedure could be used as of right.
[7]The following applications by Mrs Chin are before the Court:
(1)That the Mutual Wills proceeding (CIV-2022-485-33) be continued as an alternative cause of action in the FPA proceeding, with the Mutual Wills proceeding to be discontinued with no issue as to costs.
(2)That Steven, in his personal capacity as a beneficiary of Donald’s estate, provide further and better discovery as to:
(a)the transactions whereby he acquired shares in Don Payne Ltd in or about 27 March 2006 and 12 June 2007;
(b)the financial position of Don Payne Ltd from 1 April 2007 (at the hearing it was confirmed that rather than from 1 April 2007 discovery was sought as at 1 April 2007); and
(c)his own personal financial position (he having a competing claim to Donald’s estate).
(3)That a two day priority fixture be allocated in the third quarter of 2022.
Applications by Steven
[8] Steven, as executor, seeks the following orders in relation to the Mutual Wills proceeding:
(1)that the Mutual Wills proceeding (CIV-2022-485-33) be heard under pt 18 of the Rules at the commencement of the hearing of this proceeding (that is, the proceedings be heard sequentially);
(2)that the Mutual Wills proceeding be served on Steven in his personal capacity as a person whose interests may be affected by it;
(3)that there be standard discovery in the Mutual Wills proceeding;
(4)that affidavits of documents be exchanged within 25 working days with inspection provided electronically; and
(5)orders as to costs.
[9] Steven, as beneficiary in this FPA proceeding, seeks the following further and better discovery orders from the plaintiff, Mrs Chin:
(a)An order that the Plaintiff discovers all Trust Account statements from Simpson and Co in respect of the Estate of Mrs Bettie Welsh (the Plaintiff’s Aunty). The Plaintiff was the sole executor and beneficiary of Mrs Welsh’s Estate (“the First Request”).
(b)An order that the Plaintiff discovers all Account statements for the periods 2016 to 2022 for the Plaintiff’s investments that are recorded as earning interest in document SC.02005, namely:
i.Fisher Funds KiwiSaver;
ii.Westpac Bank Account; and
iii.Westpac Term Pie Fund. (together “the Second Request”)
(c)An order that the Plaintiff discovers all account statements for the Plaintiff’s Westpac Term Pie Fund for the periods 2016 to 2022 (“the Third Request”).
(d)An order that the Plaintiff discovers all account statements for all of the Plaintiff’s Westpac bank accounts for the periods 2016 to 2022 (“the Fourth Request”).
(e)An order that the plaintiff discovers all account statements for the Plaintiff’s Fisher Funds KiwiSaver account for the periods 2015 to 2022 (“the Fifth Request”).
(f)An order that the Plaintiff discovers all the Plaintiff’s Income Tax Returns for the years ending 31 March 2007 to 2015 (“the Sixth Request”).
(g)An order that the Plaintiff discovers all details of the joint assets owned by the Plaintiff and her late Husband, Mr Trevor Chin (“Mr Chin”), as at the date of his death (“the Seventh Request”).
(h)An order that the Plaintiff discovers all financial statements and tax returns of the Camelot Trust for the past seven (7) years (“the Eighth Request”).
(i)An order that the Plaintiff discovers all minutes of the Camelot Trust, which include, but are not limited to, minutes recording all distributions to the Plaintiff and/or Mr Chin for the past seven (7)
years, and all minutes in regards to the winding up of the Trust (“the Ninth Request”);.
(j)An order for Costs.
Consolidation?
[10] The Court would have expected counsel to have adopted a more pragmatic approach to this issue.
[11] Mr Chisnall’s application, in a practical sense, amounts to an application to consolidate the two proceedings. Mrs Chin seeks that the Mutual Wills proceeding would come to an end with no issue as to costs with that claim added to this FPA claim. A refund of the filing fee paid in the Mutual Wills claim is also sought.
[12] Rule 10.12 of the Rules deals with consolidation of proceedings and other matters in these terms:
10.12 When order may be made
The court may order that 2 or more proceedings be consolidated on terms it thinks just, or may order them to be tried at the same time or one immediately after another, or may order any of them to be stayed until after the determination of any other of them, if the court is satisfied—
(a)that some common question of law or fact arises in both or all of them; or
(b)that the rights to relief claimed therein are in respect of or arise out of—
(i)the same event; or
(ii)the same transaction; or
(iii)the same event and the same transaction; or
(iv)the same series of events; or
(v)the same series of transactions; or
(vi)the same series of events and the same series of transactions; or
(c)that for some other reason it is desirable to make an order under this rule.
[13] The discretion to make orders under r 10.12 is a wide one, to be exercised broadly in the interests of justice.1 The application of the rule will necessarily be highly dependent on the facts of each case, bearing in mind the overall objective of the rule is to avoid unnecessary multiplicity of trials if that can be achieved without injustice.2
[14] Common considerations will be the desirability of avoiding a repetition of hearings and evidence on common points, and reducing the risk of inconsistent decisions through separate hearings. However, the Court must take care to see that consolidation will not, in the end, result in confusion through multiplicity of parties and issues or cause injustice by comparison with separate hearings.3
[15] Mr Slevin, counsel for Steven as executor of Donald’s estate, in a memorandum dated 21 March 2022 said:
Given it is likely that any evidence that may be given in support of the plaintiff’s Wills Act claim may be relevant also to her Family Protection Act claim, consolidation of these two proceedings under rule 10.12 would appear to be in order. They arise out of the same series of events, being the execution of wills by and subsequent passing of the parties’ parents. It would be wasteful of judicial resources to have them continue as separate proceedings.
[16] However, Mr Slevin recorded in his memorandum that the executor was not prepared to consent to Mrs Chin’s request that she be allowed to withdraw her Mutual Wills proceeding and have the filing fee on that matter returned so that she could bring the Mutual Wills proceeding as a second cause of action in this FPA claim. Mr Slevin said: “[t]here is no provision made for such a procedure in the High Court Rules and the executor does not consent to it.”
[17] Issues of procedure are not so hidebound. The reality is consolidation as suggested by Mr Slevin would mean that no issue as to costs in the Mutual Wills proceeding would arise until the conclusion of the case in the ordinary way.
1 Regan v Gill [2011] NZCA 607 at [10].
2 Fortune Personnel Ltd v Fortune HC Auckland CL24/00, 26 March 2022 at [11].
3 Amalgamated Finance Ltd v Wyness HC Wellington CP156/86, 19 February 1987.
[18] Both counsel are agreed that it makes no sense to have two separate proceedings covering much of the same ground. However, Steven proposes the two proceedings be heard sequentially with the Mutual Wills proceeding being heard first. That application was made on the grounds that the issues for determination in the Mutual Wills proceeding are discrete and quite different from the issues in this FPA proceeding. Mr Slevin favours the Mutual Wills matter being heard first so that he, as counsel for the Estate, which abides the outcome of the FPA proceeding, could be excused from the FPA part of the hearing resulting in a costs saving.
[19] Mr Chisnall was concerned about the limitation implications of discontinuing the Mutual Wills proceeding, but that is addressed by consolidation. The existing Mutual Wills proceeding does not come to an end on consolidation.
[20]I am satisfied Mr Slevin’s first response to the issue of consolidation, set out at
[15] above, was correct. There is no point running two separate hearings one after the other when the background to both claims is largely identical. The natural way for the evidence to be given here is for Mrs Chin to give her evidence in respect of both matters and to be cross-examined on both matters. That way, the evidence on all issues comes out at the same time. I do not consider the two matters being heard as separate hearings one after the other is consistent with r 1.2 of the Rules.
[21] Accordingly, there is an order consolidating proceeding CIV-2022-485-33 with CIV-2021-485-350. All documents filed from now on will be filed under CIV-2021-485-350. Steven is to be shown as a defendant in his personal capacity as he is affected by the Mutual Wills proceeding and he is already involved in that capacity in the FPA claim.
[22] I direct that the evidence filed in each proceeding will be available as evidence in each file. All evidence is to be by way of affidavit. Discovery undertaken in one proceeding shall apply to the other proceeding and the documents discovered in one proceeding shall be available in the consolidated proceeding.
Discovery
[23] The parties already exchanged lists of documents in December 2021 in this FPA proceeding. Given the directions above, there is no point in the discovery already given being duplicated in the Mutual Wills proceeding.
[24] Discovery to be provided by each party in the Mutual Wills claim should only be in relation to further discovery put in issue by that claim.
[25] There is something in what Mr Chisnall says in the notice of opposition in relation to the 25 working day timeframe for discovery suggested by Mr Slevin. There will only be limited further discovery to be given in the Mutual Wills proceeding and the need for such has already been raised.
[26] I direct that the parties shall provide general discovery in respect of the Mutual Wills proceeding within 10 working days of the date of this Judgment. Documents already listed in the discovery provided by the parties in December 2021 need not be listed.
Discovery in the Family Protection Act proceedings (CIV-2021-485-350)
[27] The cross applications for discovery require me to address the extent to which a plaintiff is required to provide discovery of their financial position and the obligation of an existing beneficiary to give discovery of their financial position.
[28] Discovery is available in Family Protection Act proceedings.4 The real issue is what disclosure is required in the circumstances of the particular case.
[29] The discovery sought by Steven as beneficiary as set out at [9] above is extensive to say the least. Mrs Chin does not expressly advance her claim of breach of moral duty on the basis of financial need but such is implicit in the circumstances she says are relevant to quantum.
4 Bill Patterson Law of Family Protection and Testamentary Promises (5th ed, LexisNexis, Wellington, 2021) at [17.14].
[30] Mrs Chin’s financial position is given in her affidavits and in correspondence from her solicitors. Mrs Chin, however, has not provided that information in the form of a statement of assets and liabilities.
[31] Mr Chisnall, counsel for Mrs Chin, does not dispute the need for her to disclose her financial position but he says the information given by her to date is sufficient. Mr Chisnall submits the request for discovery by Steven as beneficiary goes too far and is unnecessary.
[32]Associate Judge Sargisson in Commons v Commons said:5
[26] I accept that the question of breach requires a contextual assessment and that the financial circumstances of the other moral claimants (not just those of the plaintiff) are relevant. In Re Harrison, the Court of Appeal held:6
“In considering whether there is a moral obligation, regard is had not only to the needs of the applicant but also to the extent of the estate which the testator had to dispose of and to the claims which other persons had upon him.”
[27]In Williams Aucutt, Richardson J held:7
“The first inquiry, whether there has been a breach of duty, obviously requires details of the estate and of the financial positions of the claimants and beneficiaries under the will, all as at the date of death.”
[21] Relevantly, the Court of Appeal held in McKenzie v Thomas:8
“[14] Although this is a modest estate, it is necessary to determine it on the “support” provision in s 4 of the Act. This is because neither the appellants nor the respondents provided the High Court with sufficient financial details to enable financial considerations to be taken into account. A party’s income and asset position, whether that party be an appellant or a beneficiary in the position of a respondent, should be provided in all family protection cases. These factors are relevant to whether or not the deceased has breached a moral duty.”
[28] But that need for contextual assessment does not mean a wide-ranging enquiry into inter vivos benefits – and possible or probable future benefits and the extensive discovery that would entail – would be a helpful or proportionate means of informing the assessment and the determination the Court is required
5 Commons v Commons [2019] NZHC 557 at [26]-[28].
6 Re Harrison [1962] NZLR 6 (CA) at 14.
7 Williams v Aucutt [2000] 2 NZLR 479 (CA) at [8].
8 McKenzie v Thomas CA 120/02, 14 November 2002 (emphasis added).
to make. Affidavit evidence from each of the principal beneficiaries, providing a proper statement of their financial positions as at the date of Dr Commons’ death, including any contingent and vested interested they acquired on his death, will sufficiently enable the Court to take financial considerations into account when deciding the extent of any breach. They should also enable the Court to determine what further provision, if any, ought to be made out of the estate.
[33] Her Honour was said to have “… accurately explained and applied orthodox discovery principles …” in the Court of Appeal decision declining leave to appeal.9
[34] The estate in Commons was substantial, being approximately $13,000,000. The High Court described the discovery sought by the plaintiff in that case as being “a highly intrusive foray into [the defendant’s] private life”.10
[35] I view the discovery sought by Steven in the same way. It is not unknown for a plaintiff who is not in financial need, but who is not a beneficiary, or has only been left a token sum, to expressly put their claim on the basis of what is sometimes referred to as the “family recognition” ground.11 However, that is not the case here.
[36] Had a sworn statement of assets and liabilities been given here, what would be the basis for saying Mrs Chin had to disclose her financial history going back to 2016? In the reasons given by Donald for omitting his daughter as a beneficiary, he refers to a bequest received by her from her Aunt in August 2016. The amount was approximately $590,000. Steven speculates Mrs Chin may have inherited other assets from her Aunt. Steven says in an affidavit, which was more in the nature of submissions:
However, I wish to undertake my own “tracing” exercise to reconcile the monies that the plaintiff received from the Welsh Estate with her alleged current financial position.
[37] Steven addresses each of the categories of documents he seeks. I do not intend to do so. The reasons advanced by Steven for his discovery requests amount to him not accepting Mrs Chin’s evidence. Mr Sheehan, counsel for Steven as beneficiary, accepted his client’s call for disclosure was based on suspicion. Basing an application
9 Commons v Commons [2020] NZCA 49 at [13].
10 Commons v Commons [2019] NZHC 1850 at [48].
11 Williams v Aucutt, above n 7.
for discovery on suspicion is generally referred to as “fishing”. When pressed as to what basis there was for not accepting Mrs Chin’s evidence as to her assets, Mr Sheehan could not advance any specific reason beyond posing the rhetorical question of “[w]hy would Mrs Chin not provide disclosure when it would be easy for her to do so and would put the issue of the accuracy of her evidence to rest?”. The submission was that as Mrs Chin had not provided the information sought, she must have something to hide.
[38] Mrs Chin does not have to disclose material just because it would be easy for her to do so. I accept Mr Chisnall’s submission that in the absence of some basis for doubting the accuracy of aspects of a sworn statement of financial position, the Court should not encourage discovery based on suspicion. Mrs Chin’s financial position is relevant to her proceeding, but it is her position as at the date of death of her father along with details of any material change to her financials by the trial date.12
[39] Mrs Chin providing a sworn statement of assets and liabilities was discussed at the hearing. Mr Chisnall was not opposed to one being provided, given it would draw together information already provided, albeit in various forms and documents. The completion of a statement of assets and liabilities would also assist the Trial Judge. I direct such is to be provided within 15 working days of this Judgment.
[40] I comment on one area of discovery sought from Mrs Chin in more detail. That is categories (h) and (i) set out above at [9]. Mrs Chin has advised that the Camelot Trust, which had Champagne Trustees Limited as its sole trustee, only had one asset which was sold in 2008 resulting in a very modest surplus. However, the corporate trustee was not removed from the Companies Register until 22 August 2019. Mr Sheehan submits the fact that the corporate trustee was kept alive for 10 years after the Trust assets were apparently sold, could mean it in fact held other assets. At face value, why a Trust company holding no assets would be kept alive for 10 years calls for an explanation. The company may have been kept alive against the chance it may have been used as a trustee or otherwise in the future. However, I am satisfied an explanation is required. I direct Mrs Chin to provide an affidavit explaining why the
12 Breach of moral duty is determined at the date of death but subsequent events may affect quantum of relief, see Bill Patterson, above n 4 at [3.2].
company was not removed from the Register until 2019. Other than directing the statement of assets and liabilities be provided and an explanation in relation to the Trust, Steven’s application for discovery as a beneficiary is dismissed.
[41] In short, Mrs Chin’s historical financial position is not relevant. That she had the benefit of living rent free in the property owned by her parents, and then by her father, is not disputed and its value over time can be calculated. That Mrs Chin seeks historical information from Steven does not entitle Steven to call for historical information from her. Each request must stand or fall on its own merits.
[42] I also take into account that some of Steven’s discovery requests have been explained by Mrs Chin or in letters from her solicitors. Why those explanations are not accepted by Steven other than because of distrust is not explained.
[43] Other requests relate to how funds in a KiwiSaver account were built up. Such is really beside the point when the issue is what Mrs Chin’s financial position is now. Steven refers to the KiwiSaver scheme being introduced in 2007 and Mrs Chin being out of employment since late 2017 due to her health. Steven says it follows that Mrs Chin deposited significant sums into the account which he says are relevant to Mrs Chin’s financial position. I am not sure how that is relevant. The fact is the money was saved by Mrs Chin and that is the amount that she has in her KiwiSaver account. Steven says: “presumably the [plaintiff] made significant contributions during the course of her employment”. He says this should be confirmed. Again, I am not sure why Mrs Chin’s financial position as at the date of death of her father, is relevant.
Mrs Chin’s application for discovery
[44] The position with the discovery request made by Mrs Chin of Steven as beneficiary is different. The starting point is a beneficiary is under no obligation to defend their beneficial interest.13
13 Bill Patterson, above n 4, at [17.14].
[45] As set out at [7](2) above, Mrs Chin seeks discovery of benefits received by Steven during Donald’s lifetime and, in particular, details of the transfer of Donald’s electrical business to Steven.
[46] Discovery by a beneficiary is discussed in Commons v Commons, where the Court referred to the following passage from Ashworth v Lambie:14
[41] The extent of the deceased’s moral duty is to be assessed at the time of his death. Clearly, in this case, a duty was owed to the widow and children. The size of the estate and the existence of other moral claims on it, described as “the testator’s bounty” in Re Leonard are of course relevant. But the “testator’s bounty” may be different to the “family assets”. The Court can only deal with the estate as it is and not what it might have been if the testator had not disposed of some of his assts during his lifetime, whether to beneficiaries under the will or claimants. Naturally, the Court has to have regard to the size of the estate; provision, if any, made for claimants; competing claims and all the circumstances in deciding the initial question whether there was a breach of moral duty. Neither counsel have been able to refer the Court to any authority to support the proposition that because a beneficiary receives benefits during his/her lifetime, then that can be reflected in there being an increase in the moral duty to others who claim under the legislation. It may well be that if the testator’s assets have been substantially diminished and/or depleted by inter vivos provisions to another, and as a result the estate is insufficient to meet the moral claims of others, awards to those claimants should be increased.
(Footnotes omitted)
[47] In Ashworth, Gendall J said he had only located two High Court judgments where inter vivos gifts made to beneficiaries were later taken into account when evaluating the extent of a deceased’s moral duty to a claimant.15 Mrs Chin here, seeks to identify whether there was any element of gift involved in the transfer of the business through a “friendly” purchase price, forgiveness of current account debt owed by the company to the late Donald and Peggy, or through gifts simpliciter. Mrs Chin’s reason for doing so is not to argue such gifts alone, if they occurred, bolster her claim for breach of a moral duty, but to show that one of Donald’s reasons for excluding her from the Will was incorrect.
14 Commons v Commons, above n 5 at [21] referring to Ashworth v Lambie [2012] NZHC 1110.
15 At [42].
[48]The solicitors for Donald’s estate wrote to Mrs Chin saying:
Your father’s reasons for this [making Steven the sole beneficiary] were that you had lived rent free in the property at 3 Dominion Park Street for 37 years, while Steven had not received anything. (my emphasis)
[49]That view is shared by Steven as beneficiary as he said in his affidavit:
I also believe that it weighed very heavily on Donald’s mind, that he (and my Mother for that matter) had permitted Sandra to live rent-free for 38 years without her making little to no contribution towards the outgoings (apart from payment of rates for a short time) for the Johnsonville Property. This was a significant financial contribution and advantage that Donald gave to Sandra and I did not receive any such benefit. (my emphasis)
[50] Mr Chisnall says the assertion that Steven received nothing from his parents is incorrect. What information Mrs Chin has on the sale of the business refers to their parents gifting $50,000 to Steven. There is in evidence that in 2007 the business had total assets of $304,437 funded by shareholder advances of $216,709, creditors of
$86,064 and shareholder funds of $3,664. The sale price was described as follows:
SALE PRICE
As agreed in the sale and purchase agreement the value of the share sale was to be determined once these Financial Statements were prepared.
The value was agreed to be:
Market value of Broken Hill Road property 52,500 Book value of fixed assets (excluding building) 25,994
Net of Current Assets & Liabilities (35,892) Net of Current Assets & Liabilities
50,000
Total
92,602
The company was also owes Dona and shareholder loan balance at 31 March 2007.
Peggie $216,709 being their
At the time of signing the share transfers Don and Peggie gifted $50,000 to Steve.
After taking all these transactions in to account the total owing to Don and Peggie at 31 March 2007 is $259,311. Since balance date some of this debt may have been paid with the rearrangement of maturing term deposits.
[51] Mr Sheehan acknowledges the $50,000 gift referred to. Mr Chisnall wants to investigate if any further gifting of any sort was involved. The value of the Broken Hill Road property at first glance looks modest, albeit this is an issue that could be researched without discovery.
[52] I am satisfied material relating to the valuation of the business and its assets and how that value was satisfied, including whether there was any gifting, is discoverable, given one of Donald’s reasons for omitting Mrs Chin from his Will was because Steven had not received benefits during Donald’s lifetime. That part of the purchase price of the business was gifted means Donald made an error, at least, to the extent of $50,000.
[53] Mr Sheehan advised the company’s accountant confirmed a copy of the 2006/2007 accounts for Steven’s company was not available and no electronic copy existed. If the 2007/2008 accounts exist in hard or electronic form, they will show the comparison for the previous financial year. They are to be discovered with the year ended 2008 redacted and I order accordingly. Apparently, Steven transferred the shares to his Family Trust within a year of acquisition. The value at which they were transferred will cast light on the accuracy of the purchase price. Mr Sheehan resisted discovery on the basis that the value may have represented improvements to the business made by Steven in the interim. If that is the case, that can be explained by Steven.
[54] The passage of time means there may well be limited documents relating to the 2007 sale of the business and its value or how that value was satisfied, but that emphasises the importance of discovery of what may be relevant to value or payment of the price. I direct Steven to include in his discovery documents relating to the value at which the shares were transferred to his Family Trust.
The third category of discovery sought from Steven as beneficiary
[55] Mrs Chin’s third category of discovery seeks that Steven provide disclosure of his financial position in general. In Williams v Aucutt, set out at [32] above,
Richardson J refers to the need for details of the financial position of the claimants and the beneficiaries.16
[56] Mrs Chin says Donald’s estate is worth in the region of $4,500,000. Steven, as beneficiary, does not claim to be in financial need nor in ill health. Steven was close to his father and no doubt would be able to establish a breach of moral duty had he been omitted from the Will. However, any claim Steven may have had based on moral duty could be satisfied from the estate. No issue of “distributive justice” arises here.17 Steven does not have to justify his inheritance. Mrs Chin’s claim can also be met from the estate.
[57] Mrs Chin does not need discovery of Steven’s present financial situation to establish her claim nor, given the size of the estate, would it be relevant to quantum. Steven, by choosing to not disclose his financial position will mean the Court will proceed on the basis that there is no basis for concluding Steven is in financial need. Steven’s silence as to his financial position will mean the benefit of the doubt on that issue will go against him. As Steven is content to go ahead on that basis, that is the context in which Mrs Chin’s application will be considered.
[58]I decline this category of discovery sought by Mrs Chin.
Orders and directions
[59] Mrs Chin’s application that the two proceedings be consolidated is granted as set out in [21] above.
[60] Mrs Chin is to file and serve an amended statement of claim in this FPA proceeding within 10 working days of the date of this Judgment.
16 Williams v Aucutt, above n 7.
17In Bill Patterson, above n 4, at [2.15] it is said the … financial position of the beneficiaries is only likely to be relevant in those cases where the Court is satisfied that the assets of the estate are insufficient to meet the moral claims of both claimant and beneficiaries and the question of “distributive justice” arises as in Re Sutton [1980] 2 NZLR 50 (CA).
[61] Any affidavit evidence from the defendant in respect of the Mutual Wills claim is to be filed within 20 working days of this Judgment. Mrs Chin is to file any reply evidence within a further 10 working days. (I have made time run from this Judgment rather than the amended statement of claim, given Steven is already aware of the contents of that claim).
[62] The amended statement of claim in this FPA proceeding is to be served on Steven in his personal capacity, that is, the Mutual Wills claim is to be against him in that capacity.
[63] Mrs Chin’s application to have the filing fee on the Mutual Wills proceeding refunded is declined.
[64] The executor’s application that the proceedings be heard consecutively, with the Mutual Wills proceeding being heard first, is dismissed.
[65] The parties are to give general discovery relating to the Mutual Wills claim as set out in [21]-[26] above.
[66] Steven’s application for discovery is dismissed, save that Mrs Chin will provide a sworn statement of assets and liabilities and an explanation as to the timing of the removal of Champagne Trustees Limited from the Companies Office Register; such to be provided within 10 working days of this Judgment.
[67] Mrs Chin’s application for discovery in the terms set out in [7](2)(a) and (b) above is granted. Her application in relation to [7](2)(c) is dismissed.
[68] The consolidated proceeding is set down for a two day hearing on 16 and 17 August 2022.
Costs
[69] Costs on the applications are reserved. Leave is reserved to any party to seek costs by way of memoranda – to be not more than five pages.
Associate Judge Lester
Solicitors:
Macalister Mazengarb, Wellington (for Plaintiff)
Maude & Miller, Wellington (for Defendant, S Payne as executor) Arl Lawyers, Lower Hutt (for Defendant, S Payne as beneficiary))
Copy to counsel:
P Chisnall, Barrister, Wellington (for Plaintiff)
D MacKenzie, Barrister, Wellington (for Plaintiff)
G E Slevin, Barrister, Christchurch (for Defendant, S Payne as executor)
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