Glass v Public Trust as Executor and Trustee of the Estate of Glass

[2012] NZHC 451

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2011-404-1976 [2012] NZHC 451

IN THE MATTER OF     the Family Protection Act 1955

AND

IN THE MATTER OF     the Estate of JOAN NOELINE GLASS Deceased

BETWEEN  TERENCE ROY GLASS First Plaintiff

ANDKEVIN HAROLD GLASS Second Plaintiff

ANDPUBLIC TRUST AS EXECUTOR AND TRUSTEE OF THE ESTATE OF JOAN NOELINE GLASS DECEASED Defendant

Hearing:         15 March 2012; and 2, 8, 15 May 2012 (on the papers) Counsel:       A Gilchrist for the Plaintiffs

J Finnigan for the Defendant
M J Hammond and K McLuskie for Natasha Jane Strode-Penny

Judgment:      13 June 2012

JUDGMENT OF WOODHOUSE J

This judgment was delivered by me on 13 June 2012 at 2:00 p.m. pursuant to r 11.5 of the High Court Rules 1985.

Registrar/Deputy Registrar

……………………………………

Counsel:

Mr A Gilchrist, Barrister, Auckland

Ms J M Finnigan, Public Trust, Auckland
Mr M J Hammond / Ms K McLuskie, Tompkins Wake, Solicitors, Hamilton

Instructing Solicitors:

Kiely Thompson Caisley, Solicitors, Auckland

Mr G Traves, Public Trust, Christchurch

GLASS V PUBLIC TRUST HC AK CIV-2011-404-1976 [13 June 2012]

[1]      This family protection claim is brought by two sons in respect of the will of their mother, Joan Glass.   A legacy of $20,000 was left for one son, Kevin.   No provision was made for the other son, Terence, known as Terry.  After further small legacies, the residue of the estate was left to a granddaughter, Natasha Strode-Penny, one of the children of Kevin.

[2]      I will refer to family members by their first names.   As explained to the parties  during  the  hearing  this  is  done  as  a  matter  of  convenience,  to  avoid confusion, and without intending any discourtesy.

[3]      The Public Trust, as executor and administrator, is the defendant.  However, the real contest is between Terry and Kevin as plaintiffs, and Natasha as the principal beneficiary.  Ms Finnigan, who made a formal appearance on behalf of the Public Trust, advised that the Public Trust will abide the decision of the Court and was granted leave to withdraw.

The main issues

[4]      The main issues, or areas of enquiry, are:

(a)      To the extent that there was a moral duty owed by Joan to Terry and Kevin, was that met by financial provision made for them during Joan’s lifetime?

(b)      Was there any “disentitling” conduct on the part of Terry or Kevin?

The word “disentitling” was used in submissions, although it is not entirely apt.  From the evidence there are two main areas of enquiry. The first is whether Terry or Kevin, or both, failed to provide support to, and have contact with, their mother to the extent that would reasonably be expected in the circumstances.   The second enquiry arises out of dealings between Joan and Terry when Joan sold what was left of the family farm in 2006.  The essential question is whether Terry dealt with his mother in a manner which would sufficiently

explain  and  justify  Joan’s  making  no  provision  for  Terry,  after allowing for provision made during his lifetime.

(c)      The third enquiry concerns the extent of the moral duty owed by Joan to  Natasha.    This  enquiry  is  not  for  the  purpose  of  determining whether the provision for Natasha was justified.   Natasha does not have to justify the provision made for her.  The enquiry is relevant to a determination whether Joan breached a moral duty owed to her sons and, if so, the extent of any provision that should now be made for Terry or Kevin, or both of them.

[5]      There are three important matters which are agreed.  First, Terry and Kevin agree that  Natasha,  for  the purposes  of this  proceeding,  should  be treated as  a daughter of Joan and her husband Harold.  This is because, from a very young age, Natasha was brought up by her grandparents.   Second, Terry and Kevin have expressly acknowledged that Natasha was very supportive of her grandmother.  They recognised, in effect, that Natasha has a strong claim on her grandmother’s estate. The third matter relates to the statutory right to make two types of claim; one for “maintenance” where there is financial need, and one for “support” although there may be no financial need.  Terry does not claim that he has financial need.  His claim is for support; recognition as a member of the family.   This is discussed further below when dealing with legal principles.

The family particulars

Joan and Harold Glass

[6]      Joan was married to Harold Glass.  The particulars were not provided, but it appears that Joan and Harold were married some time before 1947.  Harold died in August 1995, aged 80.   Joan died on 18 June 2010, aged 83.   They had three children, Faye, Terry and Kevin.

Children and grandchildren of Joan and Harold

[7]      Faye was the eldest child of Joan and Harold.  She was born on 17 December

1947 and died, aged 29, in 1976.  Faye had three children who were aged 42, 41 and

37 when Joan died.

[8]      Terry was born on 3 October 1950.  When his mother died he was aged 59. Terry married Tuija Kettune in 1973.  Terry and Tuija have two children who were aged 34 and 31 when Joan died.

[9]      Kevin was born on 6 March 1954.  He was aged 56 when his mother died.

[10]     Kevin has been married twice.   His first marriage was to Robyn Lovett in

September 1974.  Kevin and Robyn separated in 1978.

[11]     Natasha is the only child of Kevin and Robyn.  Natasha was born in February

1976.  She was aged 34 when Joan died.  Natasha married Shane Strode-Penny in

November 1995. They have three children. The eldest child was 11 when Joan died.

[12]     Kevin’s  second  marriage  was  to  Bronwyn  Clark,  in  1981.    Kevin  and

Bronwyn have two children who were aged 26 and 23 when Joan died.

The final will

[13]     The final will is dated 12 May 2010.

[14]     The relevant provisions of this will are: (1) the Public Trust is appointed executor and trustee; (2) there is the gift of $20,000 to Kevin; (3) there are gifts of

$5,000 each to Faye’s three children; (4) there is the gift of residue to Natasha, with a proviso that if Natasha died before Joan the residue was to be divided equally between Natasha’s children.

[15]     This will was made approximately one month before Joan died.  It was made while she was in hospital, following a stroke.  The plaintiffs do not contend that their mother lacked testamentary capacity.

[16]     The will was prepared by an officer of the Public Trust.  The will itself does not record any reasons for the provisions made and provision not made.  However, there is a note by the Public Trust officer as follows:

Will maker recently suffered a stroke.   Medical on file.   Was unable to explain the whole reason for FPA [Family Protection Act] but to say her sons have already benefited and her grand-daughter looks after her.  FPA strongly advised – shaky signature required.1

[17]     That  statement  is  contained  at  the  end  of  a  standard  questionnaire  for preparation  of  the  will.    Attached  to  it  is  a  document  headed  “Statement  to accompany my will”.   It is unsigned, but Mr Gilchrist, for the plaintiffs, accepted that it records Joan’s instructions. The statement, so far as relevant, is as follows:

Family Protection Act:

The Family Protection Act has been explained to me.  I wish to provide my estate to my granddaughter Natasha as she has been caring for me.  I have not provided for my sons as I feel that they have already benefited from me during my lifetime.   It has been explained to me that my children and my other grandchildren could contest my Will.

Testamentary Promises:

I have not promised to reward anyone under my will for services or work they have performed for me.

The estate

[18]     The only asset of Joan’s estate is a property in Mangatawhiri.   The only evidence of value is a rating valuation as at November 2011 of $580,000.  There is a debt to the Public Trust of a little over $57,000.  This arose from a loan by the Public Trust mainly to clear some estate debts incurring interest at high rates.  Deducting

the debt to the Public Trust and the legacies from the rating valuation, and without

1 The words “shaky signature required” are a reminder to the Public Trust officer to include in the

attestation clause, as occurred, that Joan signed the will “in a shaky manner”.

any allowance for costs of administration and of this proceeding, the balance is around $488,000.  On these figures the residue will be less than $450,000.

The general factual background

[19]     Harold owned a farm property near Mercer of just over 58 hectares.   This property had been owned by Harold’s father, Roy.  Faye, Terry and Kevin grew up on the farm. When they were young the farm was still owned by their grandfather.

[20]     Roy Glass died in 1976.  Title to the farm was transferred to Harold in 1978. Before title was transferred Harold had had a sharemilking contract with his father. Terry and Kevin both helped their father on the farm when they were younger.  Terry described the general circumstances when he was young as follows: “We were a typical farming family, who worked hard, had a reasonable lifestyle, but very little income”.  Kevin agreed with his brother.  Neither Terry nor Kevin became farmers (although Terry has an interest in a small farm, as noted below).

[21]     In October 1973 Terry was given a small piece of land, of approximately

1,800 m2, as a wedding present.  It was described as a gift from the grandfather and father, although title was still in the grandfather’s name.  This land was part of the farm, on a separate title.  Title was not transferred to Terry and Tuija until 1989 when the two of them purchased part of the farm, as discussed below. Terry and Tuija built a house on the section given to them.  Apart from a period of 22 months when Terry was working in Dunedin, he and Tuija have lived in this house since they built it.

[22]     In July 1976 Kevin was also given a piece of land as a wedding gift.  This section, of approximately 1,000 m2, was near the farm but not one of the farm titles. Kevin built a house on the section.  Terry said in his evidence that the section Kevin got was worth around $6,000 at the time.   Kevin accepted this estimate of value. The value of the 1,800 m2 section given to Terry was not stated.

[23]     When Kevin’s first marriage came to an end around 1978, Robyn moved away and left Natasha in Kevin’s care.  When Robyn left, Joan and Harold took a lot of  the  responsibility  for  Natasha’s  day-to-day  care.     Natasha  began  living permanently with her grandparents in or around 1981, when she was five.

[24]     In 1987 Kevin and Bronwyn moved with their two children to Australia. Kevin sold his property in Mercer.  Kevin said that after paying the mortgage and some other debts he only had enough money to buy a used car when he arrived in Sydney.  Kevin, Bronwyn and their children have lived in Australia ever since.

[25]     In 1989 Terry and Tuija purchased part of the farm from Harold.  There is an issue as to whether the purchase was at an undervalue. This is central to the question of the extent of financial provision made to Terry during Joan’s lifetime.   During closing submissions there were discussions relating to a valuation report from a registered valuer dated October 1988.  This indicated that Terry and his wife may have paid close to market value.  However, the matter had not been fully investigated and leave was granted to obtain copies of titles, produce those in evidence and make further submissions.  Further written evidence and submissions were provided.

[26]     I am satisfied that Terry and his wife were able to buy part of the farm at a price that was sufficiently less than the market value for this transaction to constitute reasonably substantial financial assistance to Terry from his parents.  This, together with the gift of the section, needs to be taken into account in assessing Terry’s claim. I will note some of the factual findings on which I base this conclusion.  I have, of course, taken account of all of the relevant evidence, including the further evidence provided following the initial hearing.

[27]     In cross-examination Terry had accepted that he purchased part of the farm “for significantly under the actual value”.   The question and the answer were as follows:

Q.        … I have put to you the proposition that you purchased that portion of the farm for significantly under the actual value of that portion of the farm.  Do you accept that?

A.        If you just take a strict value you would have to say yes but you take into consideration I was going to be there looking after my parents forever that was a consideration.

[28]     In this answer Terry also referred to the fact that GST was not taken into account, but that is not a material consideration.  In respect of the answer recorded above, the evidence establishes that Terry did not in fact look after his parents for the remainder of their lives. The sale to Terry and Tuija did assist Joan and Harold to the extent that it enabled them to clear some debt.  However, when the relevant evidence is  weighed  I  do  not  consider  the  fact  that  Harold  was  able  to  clear  the  debt diminishes in any material way the extent of the financial benefit provided to Terry.

[29]     The evidence that was provided following the main hearing bears out the accuracy of Terry’s own acknowledgement that he bought the land “for significantly under the actual value”.  Based on the valuation obtained in October 1988, a broad calculation indicates that Terry paid around 75% of the market value.  This relates to a valuation Terry had obtained for his own benefit which assessed all but 1.6 hectares of the farm at $200,000.  The 1.6 hectares were also transferred to Terry and Tuija, although the value of this extra 1.6 hectares is not clear and needs to be set off against  the  value  of  the  section  given  to  Terry.    A letter  from  Harold  Glass’s accountant to Harold referred to a Government valuation of $240,000.  At this figure the financial benefit to Terry would be somewhat greater.

[30]     On 24 August 1993 Harold made his last will.  He left his property to Joan provided she survived him. The provisions in the event that Joan did not survive him were: (1) Terry and Kevin were appointed executors and trustees; (2) the entire estate was given to Natasha provided she survived Harold and attained the age of 20 years; (3) if Natasha did not attain a vested interest the estate was to go to Kevin.  These provisions provide evidence of Harold’s assessment of his moral obligations.  In this proceeding the central enquiry in relation to moral duty is that of Joan, not Harold. However, Harold’s assessment has relevance to the claims now made by both sons and to the extent of the provision made by Joan for Natasha.   The will provides evidence that Harold considered that substantial provision had already been made to

Terry, because he made no testamentary provision for him.  It also provides evidence that Harold considered that there was a duty to make provision for Kevin, but that this duty could not prevail over the dominant duty to Natasha.  It is also relevant that Harold appointed Terry and Kevin executors and trustees because it may be inferred from this that Harold was on good terms with his sons; in other words, the lack of provision does not indicate that Harold had fallen out with his sons.

[31]     Natasha  married  Shane  Strode-Penny  in  November  1995.    Natasha  then moved with Shane to Te Awamutu.  They lived and worked away from Mercer until June 2000.   Over the period from November 1995 to June 2000 Natasha was in regular contact with, and provided support to, Joan.  In June 2000 Natasha and Shane moved back to Mercer to live with Joan on the farm.

[32]     On 20 December 2000 Joan made a will.   The relevant provisions are: (1) Terry and Kevin were appointed executors and trustees; (2) gifts of $2,000 to all of Joan’s grandchildren living at the date of her death, other than Natasha, and a gift of

$2,000 to Robert Burdeau, who had been married to Faye; (3) residue in equal shares to Kevin, Terry and Natasha; (4) if Natasha died before attaining a vested interest her share was to be divided equally between Terry and Kevin.

[33]     Between  2002  and  2005  Natasha  and  Shane  lived  in  Mangatawhiri,  but Natasha continued to see her grandmother regularly, and to provide support to her. Natasha and Shane moved back to Mercer to live on the farm with Joan in 2005.

[34]     In 2006 Joan decided that she would sell that part of the farm that she and Harold had retained and on which she was still living.  She decided to buy a property in Mangatawhiri, as a home for Natasha and her family as well as for herself.  There is conflicting evidence as to why Joan chose to do this.   The essence of Terry’s evidence, express or implied, is that pressure was put on Joan by Natasha and Shane, and at the very least because they preferred to remain living in Mangatawhiri.  It is clear from the evidence, including Terry’s own evidence, that he was opposed to his mother’s proposals and he came up with alternatives.

[35]     I am satisfied that Joan made the decision of her own volition and for her own good reasons.   A central part of this was her wish to live with Natasha and Natasha’s children, and to live in circumstances where she would, in her old age, have support and comfort from Natasha and her children which was close at hand.

[36]    Terry went to some lengths to present alternatives, including a plan of subdivision of the farmland that Joan still retained.  This plan would have meant that around two-thirds of the farm that Joan still owned would remain in her name (with the remainder going to Natasha to build a house).  Joan’s proposal involved sale of the farm out of the family.  I am satisfied that Terry’s motives were mixed.  He did believe that it would be better for his mother to remain on a part of her land.  A new home could be built for her, to replace her existing home which by then was very run down.  I accept that Terry considered that the proposed expenditure on the property in Mangatawhiri was unwise use of the money.  But I am also satisfied that part of Terry’s motivation was a degree of financial self-interest.  If at least a reasonable part of the farm that Joan still owned remained in Joan’s name, there was a reasonable prospect that part of this would be available to add to the land Terry and Tuija already owned.   Terry’s self-interest of a financial nature is indicated by his subsequent conduct.

[37]     When it became apparent to Terry that he could not dissuade his mother from selling the farm a further dispute arose.  And it is this dispute, in particular, which I am satisfied persuaded  Joan to remove Terry from her will.   This is why it  is necessary to refer to this unfortunate dispute between Terry and his mother.

[38]     In about May 2006 Terry told his mother that if her land was to be sold a part of one title – Lot 122 – would have to be transferred to Terry.  He said that there had been what he called a “gentlemen’s agreement” between him and his father that part of Lot 122 which had not been transferred in 1989, was nevertheless to go to him.

[39]     It is unnecessary to determine whether Terry was entitled to part of Lot 122. However, some of the evidence needs to be noted because of the effect of this dispute on Joan.  If Terry had an entitlement to part of Lot 122, the obvious question is why this had not been dealt with when the other titles were transferred to him and Tuija in 1989.  Perhaps anticipating this, Terry said in his first affidavit:

My father always said that part of my area was on Lot 122, but we both agreed nothing needed to happen to formalize [sic] until after my mother’s death.

A different, or additional, reason was advanced in a second affidavit when Terry said:

One of the reasons for not asking my father to do the boundary adjustment was in case he wanted to sell up and move to Pukekohe.  If my father had wanted to sell, that would have been fine.  This sale in 2006 appeared to be driven by Shane and Natasha and not in my mother’s best interests (ie away from her friends, no income).

[40]     Again, there appears to have been mixed motives.  I am satisfied that Terry genuinely believed it was not in his mother’s best interests to move.  But he was also prepared to claim part of Lot 122 – to pursue his financial interests against his mother – because she was not doing what he considered she should do.   These negative inferences in respect of financial interests are borne out by subsequent events.

[41]     There was a good deal of evidence about this dispute.   For himself, Terry presented the dispute as an unfortunate one, and one that had caused some tension at the time, but when his mother would not agree to transfer of the piece of land he did not pursue the claim.  On Natasha’s side it was presented differently, and with a fair amount of hearsay evidence and submission in affidavits, which I set to one side. The best evidence of the way in which Terry approached this comes from his own words at the time, recorded in a document he gave his mother, and in some subsequent correspondence with Joan’s lawyer.  This is important, contemporaneous evidence.  Because of this I will set out the text of some of the documents reasonably fully.

[42]     Not long before 3 June 2006 Terry presented the following to his mother:

Options for farm division

When [Terry & Tuija]  were  purchasing their  part of  farm,  ‘gentleman’s agreement’  between  seller  (dad)  and  T&T  was  that  the  natural  drain- stopbank was to be the border between the farms.  This was indicated by dad having a new fence getting built along the natural borderline instead of being diagonally built across the old roadside hay shed paddock – pond paddock. Therefore, for your consideration:

1.Terry & Tuija pay for the subdivision – eg border between T&T – mum along the present fence line from the roadside to pond paddock and stopbank – across the bog and between hay paddock hillside and pinetree hillside.

2.If the above not accepted, mum pays for the new fence line erected along the border as in the old maps eg through hay paddock to pond paddock and shift the existing fence to go along the map borderline across the old roadside hayshed paddock.   Also, pay T&T monies owed for the flood pump (purchase & repairs).

Answer needed Saturday 3 June.

[43]     On Saturday 3 June Terry and his wife went to see Joan to obtain her answer. Natasha was with Joan.  Natasha said:

I had to give them Nana’s answer because she was too scared of telling them that she was accepting option 2.  Upon hearing me tell them Nana’s decision they stormed up the hallway with Tuija saying to Nana “you have lost a daughter and now you have lost a son”.  She left and slammed the front door behind her.

[44]     In an affidavit in reply Terry expressly referred to this paragraph.  He did not

dispute Natasha’s evidence. What he did say was:

In my view, the full conversation has not been recorded.  I told both Natasha and my mother that I could live with their decision.  My words to my mother were “I have always treated you as an independent adult, and tried to help you.  You have complained about them (Natasha and Shane), and now you want to live with them.  Hope it works.”, or words to that effect.

This  is Terry’s  own  evidence  of  his  words  to  his  79  year  old  mother.    In  my judgment, whatever Terry’s intended meaning was, this could have been interpreted as being rather dismissive.

[45]     In about September 2006 Tuija, on behalf of Terry, sent a letter to Joan’s lawyer with a claim for reimbursement of expenses incurred by Terry for a flood pump used on Joan’s part of the farm.  The total was $9,782.79.  Terry also asked his mother to pay him a sum of $4,000 which Terry had paid on behalf of Kevin many years before.  Through her lawyer Joan paid her son $14,000, being the rounded up total for the flood pump expenses and Kevin’s debt.   In addition, because Terry refused, Joan paid the full cost of fencing between her land and Terry’s land for the purpose of the sale by Joan.   The evidence for Natasha is that the fencing cost

$10,000.   No documentary evidence was produced.   Terry contends that the cost would have been substantially less. The actual cost does not need to be determined.

[46]     On 27 October 2006 Joan made a new will.   I am satisfied that the main reason  for  making  this  new  will  was  what  had  occurred  with Terry.    Relevant provisions of this will are: (1) Two solicitors and a legal executive appointed executors and trustees; (2) A gift to Kevin of a whiskey decanter and matching set of glasses; (3) A gift to Natasha of all of Joan’s household furniture, articles of personal and domestic use or ornament, and any car; (4) Residue to be divided into four equal shares and disposed of as follows: one share to Faye’s children to be shared equally; one share to Kevin with a proviso that if Kevin died before attaining an absolutely vested interest his share was to go in equal shares to his children; the remaining two shares to Natasha with a similar gift over for her children.

[47]     There is a clause in the will recording reasons for the provisions, as follows:

I WISH to record my reasons for how I have divided my estate as follows:

(a)       My granddaughter NATASHA JANE STRODE-PENNY has been my  companion  and  caregiver  during  my  latter  years  and  I have brought her up as my own daughter.

(b)       I have made no provision for my son TERENCE ROY GLASS as he has  become  estranged  from  me  in  my  latter  years  and  was favourably treated by myself and my late husband during our lifetimes, particularly in respect of his purchase of the  adjoining farm property from us.

[48]     Joan settled the sale of her farmland at Mercer on 1 November 2006 and on the same day settled the purchase of the property at Mangatawhiri.  It was necessary to carry out alterations.   Natasha and Shane paid $19,000 for some of this.   In September 2007 Joan moved into the house with Natasha and her family.   Joan remained living there until she suffered a stroke in April 2010.   She remained in hospital until her death on 18 June 2010.

[49]     Between 1987, when he left New Zealand, and Joan’s death in 2010, Kevin saw his parents on two occasions only.  The first was when he returned to Mercer from Sydney to see his father when he was ill.  That was not long before his father died.   He did  not return to New Zealand for  his father’s  funeral.   The second occasion was for Joan’s funeral.  Kevin did not in fact arrive in time for the funeral. Natasha and some other witnesses on her behalf sought to make a point from this.  I accept Kevin’s evidence that this occurred because he only discovered at the last moment that his passport had expired and he was simply unable to get to New Zealand in time.

[50]     There  was  some  conflicting  evidence  as  to  the  extent  to  which  Kevin contacted his mother from Australia.   I accept Kevin’s evidence that there were telephone conversations from time to time and the occasional card.   However, the essence of this, including the essence of Kevin’s own evidence, is that there was not a great deal of contact of this nature.  It is also apparent that there was virtually no contact between Kevin and Natasha.   And, although Kevin may have made some payments under the liable parent scheme (with the evidence on this being rather vague), there is no evidence of direct financial support from Kevin for his daughter. Kevin’s wife Bronwyn did keep in regular contact with Joan.  She also visited Joan in New Zealand every two years or so.  These visits occurred when Bronwyn came to New Zealand to see her own family.  In his evidence Kevin appeared to present Bronwyn’s visits to his mother as being an indirect means by which he kept in touch.

[51]     There was also conflicting evidence as to the extent of Terry’s contact with his mother.  Until June 2006, when Terry went to Dunedin to work for 22 months, he lived close to his mother in the house on the section he had been given.   I am satisfied that Terry provided some assistance to his mother and saw her from time to

time,  but  it  was  not  extensive.    I  am  also  satisfied  that  after  Joan  moved  to

Mangatawhiri the contact was minimal.

The financial circumstances of Terry, Kevin and Natasha

Terry’s financial circumstances

[52]     As earlier noted, Terry accepts that he is not in financial need.  He accepted, in cross-examination, that “at the moment” he is “relatively well off”.  In his second affidavit he said that he was “asset rich and cash poor”, although he is not cash poor when compared with New Zealand averages.  He and Tuija still own the section that was gifted to him and the land subsequently purchased from Harold.   The capital value in 2009, assessed by the District Council, was $1,075,000.  The land value was assessed  at  $910,000  and  improvements  at  $165,000.    The  improvements  will include the house Terry built on the section that was given to him.   Terry is a fireman.  His income, after tax and an ACC levy, was $58,731 for the year ended 31

March 2011.  Tuija’s net income as an employee for the year ended 31 March 2011 was $36,283.07.  Their taxable incomes were lower after allowing for losses from a farming partnership.   At February 2011 they had savings of just under $89,000. Their children are now aged 37 and 32.

Kevin’s financial circumstances

[53]     Kevin works in Sydney as a hospital administrator.  His income after tax for the financial year ended June 2011 was AU$45,604 and Bronwyn’s income after tax was AU$41,303.

[54]     In an affidavit sworn in August 2011 Kevin said the assets owned by him and Bronwyn  were  worth  approximately AU$82,500.    The  assets  are  furniture  and fittings, personal effects, a car estimated to have a value of $15,000 and savings of

$7,521.   Their debts totalled AU$25,800, being a loan for the car of $11,300 and credit card debts.

Natasha’s financial circumstances

[55]     There is not much evidence about Natasha’s financial circumstances, and those of Shane.  In an affidavit sworn in May 2011 Shane said that his income as a truck driver was $48,000.  He had worked as a farm manager.  He said that when his last farm management job in the North Island came to an end he had considered moving to the South Island where he was optimistic he could have got a job at around $70,000 per year.  He and Natasha decided to remain at Mangatawhiri to be close to Joan.  Natasha was working on a neighbouring farm on a part-time basis, but did not provide particulars of income.  They have three young children.  There is no evidence of any assets of consequence.

The Law

[56]     Family protection claims are governed principally by s 4(1) of the Family Protection Act 1955.  The provisions of this sub-section, relevant to this proceeding, are:

4        Claims against estate of deceased person for maintenance

(1)      If any person (referred to in this Act as the “deceased”) dies, … and in terms of … her will … adequate provision is not available from

… 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.

[57]     The principles are well established by a number of decisions of the Court of Appeal and Privy Council.   Earlier authorities were discussed and principles were reviewed by the Court of Appeal in Williams v Aucutt.2   This is a case of particular relevance to Terry’s claim because the claim in Williams v Aucutt was by a daughter who had no financial need.   It was not a claim for “proper maintenance” but for “proper support”; that is to say, a claim for provision to recognise the claimant’s part

in the life of the deceased.  The survey of general principles in Williams v Aucutt is

relevant to Kevin’s claim as well as Terry’s.

2 Williams v Aucutt [2000] 2 NZLR 479 (CA).

[58]     Principles discussed in Williams v Aucutt3 may be summarised as follows:

(a)      The assessment of a claim is to be made having regard to the will maker’s “moral” duty, even though the words “moral duty” do not appear in s 4.4

(b)A will maker’s moral duty corresponds to moral claims on the will maker, or the estate of the will maker.5  An assessment of a claim may usefully be made from both perspectives.

(c)      The enquiry whether there has been a breach of moral duty is judged by the standard of a wise and just will maker.6

(d)“Proper”, in relation to “maintenance and support”, means something different from “adequate”.  In particular, a claim is not to be measured solely by financial need.7

(e)      An applicant does not have to establish a need for both maintenance and support.8    Part of the discussion of this in Williams v Aucutt is cited below.

(f)      Mere unfairness is not sufficient.  The court is not authorised to re- write a will merely because it may be perceived as being unfair to a family member.9   It must be shown that in a broad sense the applicant

has need of maintenance or support.10

3 Williams v Aucutt [2000] 2 NZLR 479 (CA) at [33]-[52].

4 Re Allen (deceased) [1922] NZLR 218 (SC) at 220; approved by the Privy Council in Bosch v Perpetual Trustee Co Ltd [1938] AC 463 at 479. The words “moral duty” now appear in s 3(2), providing for claims of grandchildren and inserted in the Act in 1967.

5 Little v Angus [1981] 1 NZLR 126 (CA) at 127.

6 Bosch v Perpetual Trustee Co Ltd [1938] AC 463 (PC) at 478-479.

7 Ibid at 479.

8 Williams v Aucutt [2000] 2 NZLR 479 (CA) in particular at [52] and [69].

9 Williams v Aucutt [2000] 2 NZLR 479 (CA) at [68] per Blanchard J.

10 Re Leonard [1985] 2 NZLR 88 (CA) at 92.

(g)A claim must not be considered in a vacuum.11     All relevant circumstances need to be taken into account.  Some circumstances of importance are noted in following sub-paragraphs.

(h)The size of the estate is highly relevant.12   A smaller estate in present day terms, related to assessments of smaller estates in earlier cases, might be around $2 million.13

(i)The strength of a moral claim will be affected by the relative strength of other moral claims.14

(j)“… [D]ue 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.”15

(k)The  part  played  by  the  claimant  in  the  life  of  the  deceased  will obviously be important.16

(l)The question for the court is not whether the provisions of the will are appropriate or justified.   The question is whether there has been a breach of duty by the will maker to the particular claimant.17

(m)A beneficiary does not have to justify the share which the beneficiary has been given.18

(n)If a breach is established the provision ordered should be no more than what is required to repair the breach.19

11 Re Harrison (deceased) [1962] NZLR 6 (CA) at 13.

12 Re Allen (deceased) [1922] NZLR 218 (SC) at 221; Little v Angus [1981] 1 NZLR 126 (CA) at 127.

13 Williams v Aucutt [2000] 2 NZLR 479 (CA) at [40].

14 Re Allen (deceased) [1922] NZLR 218 (SC) at 221-222; Little v Angus [1981] 1 NZLR 126 (CA) at

127.

15 Re Leonard [1985] 2 NZLR 88 (CA) at 92.
16 Williams v Aucutt [2000] 2 NZLR 479 (CA) at [52]. A fuller passage is cited below.

17 Re Shirley CA155/85, 6 July 1987; Williams v Aucutt [2000] 2 NZLR 479 at [48]-[51].

18 Williams v Aucutt [2000] 2 NZLR 479 (CA) at [68] per Blanchard J, concurring with Richardson P

and Gault, Keith and Tipping JJ.

19 Little v Angus [1981] 1 NZLR 126 (CA) at 127; Williams v Aucutt [2000] 2 NZLR 479 at [70]; and see below.

(o)      Whether there has been a breach is usually to be assessed as at the

date of the will maker’s death.20

(p)Any available evidence of the will maker’s reasons for the provisions in the will, and for not making provision, is relevant.  Nevertheless, it is for the court to determine what weight, if any, is to be attached to any given reasons.21

[59]     Having regard to the nature of the claims in this case, and in particular that of

Terry, I will set out more fully three passages in Williams v Aucutt:

[52]      … [We] reject the argument that the court must expressly find a need for proper maintenance and support. The test is whether adequate provision has been made for the proper maintenance and support of the claimant. Support is an additional and wider term than maintenance. In using the composite expression, and requiring "proper" maintenance and support, the legislation recognises that a broader approach is required and the authorities referred to establish that moral and ethical considerations are to be taken into account in determining the scope of the duty. 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. Just what provision will constitute proper support in this latter respect is a matter of judgment in all the circumstances of the particular case. It may take the form of lifetime gifts or a bequest of family possessions precious to its members  and  often  part  of  the  family  history.  And  where  there  is  no economic need it may also 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.

…

[69]     ... It is not to be assumed that merely because a claimant, no matter what his or her personal substance, has been a dutiful child of the deceased, it  will  necessarily  be  appropriate  to  order  some  provision  or  further provision. In some cases a mere acknowledgement of the relationship may be the most that can be expected. And in others the competing claims on the testator of a surviving spouse or of less fortunately placed siblings may negate any moral duty towards a wealthy claimant.

20 Little v Angus [1981] 1 NZLR 126 (CA) at 127.

21 Family Protection Act 1955, s 11. See Auckland City Mission v Brown [2002] 2 NZLR 650 (CA) at

[14] and [39].

[70]     It is 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. Beyond that point the testator’s wishes should prevail even if the individual Judge  might,  sitting  in  the  testator’s  armchair,  have  seen  the matter differently. As I have said, the court’s power does not extend to re- writing a will because of a perception that it is unfair. Testators remain at liberty to do what they like with their assets and to treat their children differently or to benefit others once they have made such provisions as are necessary to discharge their moral duty to those entitled to bring claims under the Family Protection Act.

Conclusion

[60]     Claims under the Family Protection Act often require the court to make a judgment about relationships between parents and children.  It is not always an easy task and it is not an easy task in this case.   It is made no easier when it becomes necessary, as it has been in this case, to try to evaluate conduct in moral terms.  I refer here to Terry’s conduct in 2006.  It was necessary to make an evaluation not for the sake of criticism, but because this was a matter, in all the circumstances of this case, of importance in determining whether Joan had breached a moral duty owed by her to Terry.   Matters of this nature, and the fundamental fact that the court is assessing the relationship between a mother and a son, require caution and respect before coming to a conclusion.  I have sought to apply both.  Having done so, and when the principles I have outlined are applied to the facts of this case, I am not persuaded that Joan was in breach of a moral duty owed by her to Terry in failing to make provision for him in her will.

[61]     The principal reasons for my conclusion are as follows.   This is a small estate. The primary moral duty of Joan was the moral duty to Natasha and Natasha’s young children.  This was expressly and generously recognised by Terry.  The only asset is the property at Mangatawhiri where Natasha lives with her husband and her children and which Joan bought for Natasha and her children.  It is sufficiently clear from the evidence that it was Joan’s intention that the property should remain as a home for Natasha and her children.  For that to be achieved from this small estate means that Natasha and her husband will have to borrow money to meet the debt to the Public Trust and to pay the gifts to Kevin and to Faye’s children.  I am satisfied that this will be a reasonably substantial financial burden for Natasha and Shane.

Any further provision will add materially to a financial burden that Joan understandably wanted to minimise for Natasha.

[62]     Against these considerations is the fact that substantial financial provision was provided to Terry during Joan’s lifetime. The benefit to him in financial terms is reasonably large in relation to Joan’s estate.  This may be seen by applying the 1988 undervalue by at least 25% to the current value of around $1 million of the land acquired by Terry from his parents.  Because Terry’s claim is one for support, and not for maintenance,  this  provision  to  him  during Joan’s  lifetime is  significant. Standing alone, when all other relevant factors are weighed, further provision to him out of the estate could not easily be justified.  The unfortunate events in 2006 lend some weight to these primary conclusions.

[63]     Approaching Kevin’s claim for further provision with the caution and respect discussed above in relation to Terry’s claim, and applying the legal principles to all of the circumstances relevant to Kevin’s claim, I am also not persuaded that Joan was in breach of a moral duty to Kevin by failing to make provision of more than

$20,000 for him.

[64]     The principal considerations in relation to Kevin’s claim are similar to some of the principal considerations relating to Terry’s claim.   It is a small estate.  The claim of Natasha and her young children is particularly strong; the moral obligation of Joan to Natasha and Natasha’s children was correspondingly strong.  There is an added circumstance of some importance in Kevin’s case, compared with Terry.  This is the fact that Natasha is Kevin’s daughter.   Without intending to express any judgment   about   what   occurred   between   father   and   daughter,   the   effective transference of the moral obligation and the moral claim to Joan reinforces the strength of Natasha’s claim against the claim Kevin now makes for further provision. In addition, for there to be further provision to Kevin would require his daughter to borrow money to pay him.   Otherwise the property will have to be sold with the result that Kevin’s daughter and his three grandchildren will lose the home that their grandmother and great-grandmother sought to provide them with from her limited resources.   In respect of Kevin’s claim there are the other matters outlined in the discussion of the facts and which need only be noted at this point: there was some

financial provision to Kevin during Joan’s lifetime, in addition to the $20,000 legacy

in her will, and the contact between Kevin and his mother was limited.

Result

[65]     The claims are dismissed.

[66]     Any applications for costs should be made by memorandum to be filed and served within one month, with any response to be filed and served within a further month.  These directions apply to any application that may be made by one party for costs against another party, and including any application that costs be paid out of the estate, save for the costs of Public Trust payable out of the estate to Public Trust

as executor and trustee.

Woodhouse J