Haines v Chellew HC Auckland CIV 2004-404-004556

[2008] NZHC 2634

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV 2004-404-004556

IN THE MATTER OF     the Family Protection Act 1955

AND

IN THE MATTER OF     the estate of RAE THOMAS HAINES BETWEEN  LYNNE MAREE HAINES

Appellant

ANDJENNIFER ANNE CHELLEW AND NEIL WILLIAM HAINES

Respondents

Hearing:         9 September 2008

Appearances: J B Murray for the Appellant

A G Stuart for J A Chellew
A D Banbrook for N W Haines

Judgment:      21 October 2008 at 4.45pm

JUDGMENT OF WYLIE J

This judgment was delivered by Justice Wylie on 21 October 2008 at 4.45pm

pursuant to r 540(4) of the High Court Rules

Registrar/Deputy Registrar

Date:

Solicitors/Counsel:

Vallant Hooker & Partners, P O Box 47 088, Ponsonby, Auckland

Webster Malcolm & Kilpatrick, P O Box 22, Warkworth

Corboy Wilson Rolfe & Co, P O Box 20, Wellsford

Smythes Solicitors, P O Box 279, Nelson

Mr Banbrook, West Plaza Chambers, P O Box 3600, Shortland Street, Auckland 1140

L M HAINES V J A CHELLEW AND N W HAINES HC AK CIV 2004-404-004556  21 October 2008

[1]      This is an appeal from a decision of Judge J M Doogue sitting in the Family Court at Auckland.  The issue is how the estate of the late Rae Thomas Haines (“the deceased”) should be divided amongst his three children.

Relevant factual background

[2]      The  deceased  died  at  Auckland  on  21  August  2002.     He  was  aged approximately 69 years.  He left a Will dated 5 April 1991, probate of which was granted to his brother – a Mr R D Haines – on 30 August 2002.

[3]      The deceased had long been divorced from his former wife.  He was survived by three children, Jennifer Anne Chellew (“Jennifer”) born December 1958; Neil William Haines (“Neil”) born April 1960; and Lynne Maree Haines (“Lynne”) born September 1961.  As at the date of his death, the deceased was estranged to a degree from Jennifer and to a significant extent from Neil.   The deceased also had three grandchildren – all the children of Jennifer.

[4]      In his Will the deceased provided that, after payment of his just debts, his estate was to be left to Lynne.  He made no provision for either of his other children.

[5]      Jennifer commenced proceedings under the Family Protection Act 1955 (“the Act”), alleging a breach of moral duty by the deceased to provide for her proper maintenance and support, and seeking provision from the estate.   Neil then joined those proceedings and also sought provision from the estate.  Lynne gave notice of her intention to appear and make submissions, especially as to the form of any Court order that might be made.

Family Court decision

[6]      The  Family  Court  hearing  proceeded  on  the  papers  and  by  way  of submissions from counsel for the various parties.  There was no cross-examination, and all evidence was by way of affidavit.

[7]      Numerous affidavits as to the value of the various estate assets were filed, and at the hearing counsel were  agreed that the estate comprised the  following assets:

Whangaparaoa property as per

valuation:  $245,000.00

Incidental assets:  $61,369.53

Less liabilities:  $25,335.93
Net:  $36,033.60

Rounded to say:  $  36,000.00

Raemos Land Development Limited

shares:  $516,930.00

Waitemata Press Limited shares:

“A” shares:  $18,900.00 “B” shares:     $  7,594.50

Total:  $  26,494.50

Tax loss:  $ 38,129.00

Total:  $862,553.50

[8]      Her Honour Judge Doogue reviewed the relevant facts and examined the factual background.  She considered Jennifer’s modest financial circumstances and her relationship with the deceased.  She then considered the financial circumstances of Neil, which were better than those of Jennifer but still relatively modest, and Neil’s relationship with the deceased.  She then noted Lynne’s circumstances, which were rather better than those of either her sister or her brother, and noted that Lynne did  not  formally  oppose  the  applications  by  her  siblings.     Her  Honour  also considered the position of the three grandchildren, some of whom had given notice of their intention to be heard, but none of whom had sought provision from the estate.

[9]      Her Honour then considered the legal principles relevant to the Act, and noted specifically the decisions of the Court of Appeal in Little v Angus [1981] 1

NZLR 126, Re Leonard [1985] 2 NZLR 88, and Williams v Aucutt [2000] 2 NZLR

479.  She concluded that the deceased had breached his moral duty to provide for Jennifer who she considered was in financial need, and in need of support to sustain an adequate level of comfort.  Her Honour was of the view that there was nothing in

Jennifer’s conduct, nor in the estrangement between her and the deceased which amounted to disentitling conduct.  She also found that the deceased had breached his moral duty owed to Neil.  She considered that he was also in financial need, and that he needed support.  The Judge did, however, note that while Neil was not necessarily responsible for the rift between himself and the deceased, he had not made any attempt at rapprochement or reconciliation.

[10]     Having concluded that the deceased had breached his moral duty to Jennifer and Neil, the Judge went onto consider what a wise and just testator would have done.  She recorded that the starting point must be that the Will is to be disturbed only to the extent necessary to remedy the breach.   She noted that it was not for Lynne to justify the bequest made to her by the deceased, and that there was no presumption of equality.  She observed that the Court had to make an independent assessment of each claim.  She concluded that Jennifer had a very strong claim for provision and support, and awarded her the sum of $300,000.  She awarded Neil the sum of $225,000.  Her Honour also held that they were entitled to their costs from the estate, as were counsel for Lynne, the trustee and the grandchildren.  The balance of the estate was vested in Lynne.

The appeal

[11]     Lynne has appealed against this decision.  The appeal is pursuant to s 15 of the Act.  It is a general appeal.

[12]     Section 15(1A) provides that the High Court Rules and ss 74 to 78 of the District Courts Act 1947, with all necessary modifications, apply as if the appeal were an appeal under s 72 of the District Courts Act 1947.  It follows that the appeal is by way of rehearing – see s 75 of the District Courts Act 1947, and r 718 of the High Court Rules.

[13]     Where the Court appealed from has exercised a discretion, the position has generally been that an appellate Court should only interfere if it considers that the decision of the lower Court is clearly wrong, or that the discretion has been exercised

on a wrong principle, or not exercised at all, or there has been a miscarriage of justice:  see, e.g. May v May [1982] 1 NZFLR 165.

[14]     The  position  in  regard  to  general  appeals  has  shifted  as  a  result  of  the Supreme Court’s recent decision in Austin Nichols & Co Inc v Stichting Lodestar [2008] 2 NZLR 141. Delivering the judgment of the Court, Elias CJ noted at [16] as follows:

Those exercising general rights of appeal are entitled to judgment in accordance with the opinion of the appellate court, even where that opinion is an assessment of fact and degree and entails a value judgment. If the appellate court’s opinion is different from the conclusion of the tribunal appealed from, then the decision under appeal is wrong in the only sense that matters, even if it was a conclusion on which minds might reasonably differ. In such circumstances it is an error for the High Court to defer to the lower Court’s assessment of the acceptability and weight to be accorded to the evidence, rather than forming its own opinion.

[15]     This approach does not apply to appeals from the exercise of a discretion:

see Blackstone v Blackstone [2008] NZCA 312.

[16]     The present appeal is a general appeal, albeit a general appeal involving the exercise of a discretionary judgment.  I have approached the present appeal bearing in mind the Supreme Court’s observations, and I have applied the same.

Submissions

[17]     Lynne, through her counsel, accepted that the Family Court was right to find that some provision should be made for her sister and brother.   The appeal was against the extent of the awards made on two grounds:

a)       the awards made by the Family Court were too high; and

b)events have transpired since the Family Court decision with the result that the awards were manifestly inappropriate.

[18]     Pursuant to the Family Court judgment, the children were prima facie to receive the following:

a)        Jennifer – $300,000;

b)        Neil – $225,000;

c)        Lynne – $337,500.

The Judge also ordered that the costs of the proceedings should be paid by the estate. These could only be deducted from Lynne’s vested share in the estate, because both of her siblings received fixed awards.   Costs came to $88,833.80 in total.   As a result, pursuant to the Family Court judgment, Lynne, the sole beneficiary under the Will, received some $248,500.  It was submitted for Lynne that this was contrary to established case law, and that the awards made to Jennifer and Neil were simply too high.

[19]     Reference was also made to events which have transpired since the Family

Court decision.  They were said to be as follows:

a)        As noted the legal costs and disbursements of the parties to the Family

Court  proceedings  paid  by  the  estate  were  in  the  total  sum  of

$88,833.80.

b)The Whangaparaoa property was sold for $238,500, and the return to the estate net of commission and other costs of sale was $226,389.97.

c)       The  commercial  building  owned  by  Raemos  Land  Development Limited was sold for $725,000, and after the costs of sale, the return to the company was $698,632.66.

d)The net assets of the two companies, Raemos  Land Development Limited and Waitemata Press Limited, were distributed to the shareholders, namely Lynne and the estate, resulting in the payment of taxation.

e)        Neil was awarded and paid $131,046.66 from the estate pursuant to a

District Court judgment – Haines v Tornquist & Ors, DC North Shore

CIV 2005-004-001208, 30 October 2006, Judge R L Kerr – that held that he was entitled to 1,000 shares in Raemos Land Development Limited.

f)        In accordance with the District Court judgment in Haines v Tornquist, the legal costs of the parties to those proceedings were paid from the estate. They amounted to $76,118.25.

[20]     I was told that as a result of these various events, the estate now consists of cash which is on deposit.  As at the date of hearing in this Court, the total cash held by the estate, including accrued interest, was some $648,898.

[21]     If the awards made by the Family Court to Jennifer and Neil are to stand, Lynne would receive approximately $124,000.  It was Lynne’s case that despite the fact she was the principal beneficiary under the Will of the deceased, as a result of a Family Court decision, and subsequent events, she receives only a relatively small bequest, less than either of her siblings, and that the Family Court has in effect re- written the Will.   It was submitted that this breaches almost all of the settled principles in family protection cases.

[22]     It was also submitted for Lynne that Neil’s position has altered substantially as a result of the District Court judgment in Haines v Tornquist.  The Family Court judgment under appeal recorded at [45] that in mid-2004, Neil was in receipt of Accident Compensation payments, his income over the previous 12 month period had been some $26,000, and his then current assets were some $86,000.  As a result of the payment made to him by the estate consequent on the District Court judgment in Haines v Tornquist, his assets have been boosted by the receipt of an additional

$131,000.   It was submitted for Lynne that this must inevitably change a Court’s view of what was adequate maintenance and support for Neil, and require a re- assessment of what is the appropriate further provision for him.

[23]     Mr  Stewart  for  Jennifer  accepted  that  events  since  the  District  Court judgment have meant that the size of the estate had been substantially reduced. Nevertheless, he argued for a close analysis of the changes to determine whether

there was a real consequence to the parties.   In this regard, it was submitted the realised value of a number of the assets was either similar to, or substantially higher than that which had been assumed in the Family Court.  He submitted that realised value  of  the  estate  assets  was  some  $980,000,  as against  the  sum  of  $862,000 assumed in the Family Court.  It was accepted that the value of the estate had been depleted by the payment of the costs in the family protection proceedings, by the payment of funeral and burial expenses for Jennifer’s son who died in Australia, by the payment of the judgment in Haines v Tornquist in favour of Neil, and by the payment of costs ordered in those proceedings.  Although there was some difference between Mr Stewart and Mr Murray as to the precise figures, it was accepted that the outcome for the parties consequent upon these changes was not “a proper outcome”. It  was  also  accepted  that  as  a  result  of  the  successful  claim  by  Neil  for  his entitlement for 1,000 of the shares in Raemos Land Development Limited, there was a need for the Court to revisit the awards made in the Family Court.  It was argued that the real issue was how the deceased’s breach of moral duty to Jennifer and Neil should be reassessed in light of Neil’s successful claim in Haines v Tornquist and his receipt of approximately $131,000 as a consequence.

[24]     It was submitted by Mr Stewart that Neil’s claim in Haines v Tornquist was advanced on the basis that the shares in question were held in trust for him by the deceased’s accountant, and that they had been transferred by the accountant to the deceased in breach of that trust.   Those claims had been accepted by the District Court.  As a consequence, it was said that it followed that Neil’s receipt of the shares in Raemos Land Development Limited was an inter vivos gift made by the deceased to Neil, and that the same should be taken into account in assessing the extent of the deceased’s moral obligation to provide further for Neil in his Will.  It was submitted that the Court should reduce the award made in favour of Neil, and that the appropriate awards should be approximately as follows:

a)        Jennifer           $245,000.00; b) Neil           $22,000.00; c)  Lynne    $405,000.00.

[25]     Mr Banbrook for Neil reiterated that the Family Court had determined that there was a breach of moral duty owed by the testator to both Jennifer and Neil. Mr Banbrook responsibly accepted that the value of the inter vivos gift upheld by the District Court in Haines v Tornquist and made by the testator prior to his death, has a bearing on assessing both the breach of moral duty owed to Neil and the extent of any provision necessary to repair the breach.  He nevertheless submitted that each of the children had received valuable inter vivos gifts from the deceased, and that Neil should not be penalised because it was necessary to litigate to recover the Raemos shares.   He submitted that all inter vivos gifts should be treated as being of approximately equal value, and that Jennifer should receive approximately $233,000, Neil $175,500, and Lynne $263,500.   He suggested that this was appropriate, and that  it  reflected  to  some  extent  the  conduct  of  Lynne  in  relation  to  the  estate litigation, and the subsequent litigation in relation to the Raemos shares.   It was argued that Lynne had made a major contribution to the estate incurring legal costs of $165,000 which were in substantial part unnecessary.

[26] It will be noted that both Mr Stewart and Mr Banbrook proceeded in the assumption that the total value of the estate is approximately $672,000. This figure did not include accumulated interest. Mr Murray proceeded on the assumption that the estate was valued at some $648,898 including accumulated interest. Mr Murray did not include the tax losses referred to in [7]. He told me from the bar that they were no longer available. The evidence before the Court did not however clearly establish this, and I accept Mr Stewart’s submission that on the material available to me, the tax losses may still be available for Lynne. I have accordingly proceeded on the assumption that the estate assets comprise some $672,000, plus accrued interest of approximately $15,000.

Analysis

[27]     The starting point is s 4(1) of the Act.  It provides as follows:

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.

[28]     Persons   entitled   to   claim   under   the   Act   include   the   children   and grandchildren of the deceased:  see s 3.

[29]     There was no dispute between counsel as to the relevant principles.  They can be largely derived from a number of decisions of the Court of Appeal – Little v Angus [1981] 1 NZLR 126; Re Leonard [1985] 2 NZLR 88; Williams v Aucutt [2000] 2 NZLR 479; and Auckland City Mission v Brown [2002] 2 NZLR 650.

[30]     Cooke J (as he then was) summarised the overall position in Little v Angus at

[127] as follows:

The principles and practice which our Courts follow in Family Protection cases are well settled. 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.

[31]     The concept of breach of moral duty was expanded on in Re Leonard where

Richardson J noted at [92] as follows:

The question of whether the testator was in breach of his moral duty to his daughters as claimants on his bounty must be determined in the light of all the circumstances and against the social attitudes of the day. An applicant need not be in necessitous circumstances: the size of the estate and the existence of any other moral claims on the testator's bounty were highly relevant. 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.

[32]     The words “moral duty” used by the Court of Appeal in these and other decisions, are not used in s 4, but it is trite law that they are implicit in the enquiry that the section requires – Williams v Aucutt at [38] and [58].

[33]     The necessary enquiry is not confined to financial matters.   In Williams v

Aucutt at [52], Richardson P observed as follows:

Second, for reasons which will be apparent from the earlier discussion, 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.

[34]     If breach of moral duty can be established, it is clear that it is not the Court’s function to re-write the Will of the deceased except to the extent necessary to remedy that breach.  As was noted by Blanchard J in Williams v Aucutt at [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 rewriting 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.

[35]     Similar comments were made by the Court in Henry v Henry [2007] NZFLR

640 at [54] to [56].

[36]     Finally in this regard, it should be noted that it is not for a beneficiary to justify the share in the estate which he or she has been given by the deceased:  see Williams v Aucutt at [33] and Auckland City Mission v Brown at [39].

[37]     Against the background, I turn to consider the positions of Jennifer and Neil. Before doing so, it is helpful to discuss briefly the circumstances of the deceased.

The Deceased

[38]     The deceased was born in January 1933.  At the age of 12 or thereabouts he left home, although it seems he may have subsequently returned at least for a short period.  While still at school, he worked selling newspapers and as a shoe shine boy. He ended his schooling while he was living at the Salvation Army Home for Boys in Hamilton.  This was when he was about 13 or 14 years of age.

[39]     Thereafter, the deceased moved around  New  Zealand,  until  he  settled  in Auckland in about 1953 to start an apprenticeship.  He went to Australia and worked in a printing business in Sydney and played rugby league.  He returned to Auckland sometime thereafter, and resumed his courtship with his later wife.  They married in

1958, when the deceased was aged 25.

[40]     The  deceased  held  down  a  number  of  jobs  when  he  was  younger.    He purchased a printing business, Waitemata Press Limited, in about 1972, initially using second-hand machinery.   The deceased set up another company – Raemos Land Development Limited – to buy land at Ellis Road in Glenfield, and he built a factory on that land which was rented to Waitemata Press Limited after the printing business moved from its initial location in Browns Bay.  The financial position of the printing business gradually improved.

[41]     It is common ground that the deceased worked extremely hard for most of his working life and that as a consequence of his dedication to the business, his family was  never  in  financial  need.    It  is  equally  clear  that  the  family  had  very  real emotional needs and these were not always met by the deceased.   His children variously described him as stubborn, and as liking his own way.  They agree that he was not an affectionate or particularly communicative man, and it is clear that he had real difficulty relating to his family members.

[42]     The evidence also establishes that the deceased had a significant problem with alcohol.  There were often arguments with his wife, and with his children.  It seems that the deceased on occasion assaulted his wife, and both Jennifer and Neil. All children in various ways described incidents of domestic abuse in their respective affidavits.

Jennifer

[43]     Jennifer is a cleaner.   She was married  at an early age, for  a period of approximately four years.  That marriage came to an end and she has since been in a long term relationship with her current partner.  She has three children, two by her ex-husband, and one by her present partner. One of those children is schizophrenic.

[44]     Jennifer and her present partner jointly own a property which was valued as at April 2002 at $170,000.  It is subject to a mortgage which as at August 2003 stood at  $120,000.    They  also  jointly  own  a  Nissan  truck  valued  at  $2,000,  and  a Mitsubishi truck gifted to them by Lynne from the estate, valued at some $2,000. They jointly run a cleaning/home handyman business, but it produces relatively small returns.  Their joint assets as at the date of hearing in the District Court were some $54,500, and it follows that Jennifer’s half share was some $27,250.   As against that, they have various liabilities, which Judge Doogue totalled at around

$17,000.   This included a sum owing to the estate of some $12,000 which was advanced by the estate to enable Jennifer to pay the funeral account for one of her children, and bring his body back from Australia.

[45]     I agree with Judge Doogue’s conclusion that the deceased breached the moral duty he owed to Jennifer, and that he did not provide for her proper maintenance and support.  She is clearly in a precarious financial position, and it is appropriate that provision should be made for her from the deceased’s estate.

[46]     I  also  agree  with  Judge  Doogue’s  finding  that  there  was  no  disentitling conduct by Jennifer.  She clearly had a difficult relationship with the deceased.  She frequently stood up to the deceased over his drinking habits.  When she was aged about 16, the deceased ordered her to leave the family home for quite inappropriate

reasons.   The   deceased   did   not   approve   of   Jennifer’s   boyfriend.      Jennifer subsequently married the boyfriend.  The deceased refused to attend the wedding and disapproved of the marriage.  It seems however that he did provide some assistance both to Jennifer and her then husband notwithstanding his disapproval.   Moreover when the marriage came to an end, the deceased provided work for Jennifer at his printing factory, and it is clear that he had considerable affection for his grandchildren.  However, this caused difficulties between Jennifer and the deceased because the deceased used to drink while his grandchildren were in his care.  All of this occurred against the background that the deceased had no real ability to deal with close, sensitive and loving relationships.

[47]     Judge Doogue noted that Jennifer spent the last 10 days of the deceased’s life with him, without objection, and that was an indication of the strength of the bond between them.  Again I agree with this observation.

[48]     I accept in a broad sense Mr Banbrook’s submission that there were some inter  vivos  gifts  made  to  Jennifer  during  her  life,  and  that  she  received  some assistance  from  the  deceased,  including provision  of  work  when  she  needed  it. Much the same applies to Lynne and to Neil.  All received financial assistance from the deceased from time to time and all worked for the deceased’s business.  There is no evidence before me to enable me to quantify the value of those gifts and that assistance, but such material as is available suggests that the gifts made, and the assistance given at least to Jennifer, were significantly less valuable than the inter vivos gift of shares in Raemos Land Development Limited conferred on Neil.  I do not accept Mr Banbrook’s submission that the inter vivos gifts made to the various children should be considered to be equal.

[49]   The deceased left a relatively modest estate.   What constitutes proper maintenance and support in Jennifer’s particular circumstances, is ultimately not a matter of “mathematical or scientific calculation”:   see Worboys v Jones [2004] NZFLR 360 at [33].  On balance, and taking into account the size of the estate as it now  is,  it  seems  to  me  that  the  award  made  by the  Family Court  was  unduly generous, and that in effect the Court was rewriting the Will and going beyond what was necessary to repair the breach of moral duty found to exist.  The problem was

exacerbated by the order that costs should be paid by the estate, and has been further exacerbated by the events which have taken place since the judgment was given.

[50]     In  the  circumstances,  I  am  satisfied  that  the  hypothetical  wise  and  just testator, considering Jennifer’s circumstances, would have left Jennifer the sum of

$200,000 to enable her to improve her financial position, to clear her debts, and to give her a small buffer against any adverse financial events which could occur in the future.  A wise and just testator would have taken into account the fact that Jennifer has three children – and that one of those children has a significant mental health issue.  I award Jennifer the sum of $200,000 from the deceased’s estate.

Neil

[51]     Neil was the middle child in family.  At the time of the Family Court hearing, he had recently been divorced.  He was not in work, and he was unable to work until his health improved.   He was suffering from chemical poisoning as a result of exposure to chemicals at work.  He was participating in a rehabilitation programme and had been in receipt of ACC payments for a number of years.   He had settled relationship  property  matters  with  his  former  wife.    He  owned  a  car,  with  an estimated value of $7,000 and a bus that was valued at some $29,000.  He did not own any real property.  In his initial affidavit he stated that he had $68,000 in cash. In his second affidavit he stated that he had only $50,000 on deposit.  Presumably he had spent or invested the sum of $18,000 in the interim.  That is not disclosed in the papers.  Judge Doogue proceeded on the assumption that he had assets of $86,000.

[52]     It is also clear from the affidavits that Neil and the deceased had a difficult relationship.  It was Neil’s evidence that the deceased was disappointed because he chose soccer as a sport over rugby.  Nevertheless, he worked for the deceased as an apprentice printer from the age of about 15 years.   Neil was affected by the deceased’s drinking problem, and on occasion he intervened when the deceased was assaulting his mother.  He was also on occasion assaulted himself.  He deposed that in 1974, the deceased was found guilty of assaulting him following a Court hearing.

[53]     Following the separation of his parents, Neil chose to live with his mother, and a few days thereafter, he was sacked by the deceased.  The deceased stated that he did not want to see Neil again.

[54]     Some years later he was again offered work by the deceased.  He accepted and worked for the deceased until he was about 24 years old.   Neil then went overseas  to  play soccer.    Sometime  thereafter  the  deceased  asked  Neil  and  his fiancée if they would move back to Auckland and help him build up the company – Waitemata Press Limited.  He apparently promised Neil that he would take over the running of the company once they had settled.  Nevertheless, this arrangement did not work out.  According to Neil, the deceased asked him to sign various papers.  He declined to do so, with the result that the deceased refused to make a promised gift of

$10,000 to help Neil and his fiancée meet their commitments, and sacked Neil again.

[55]     Neil was not forthcoming  in  his  initial  affidavit,  but  it  is  clear from  an affidavit that was filed by Lynne that in 1975 the deceased created 1,500 non voting B shares in Waitemata Press Limited, and placed them in trust for Neil.  In August

1978, 500 of the shares were transferred to Neil, and the balance were transferred to him in 1979.  Various amounts were credited to Neil’s shareholder current account between March 1978 and March 1983.  By the end of 1983, the current account in Neil’s name totalled some $20,650.  When Neil and the deceased went their separate ways in 1983, Neil requested payment of the current account.  The deceased declined to authorise the payment.   In the event proceedings were issued and the current account claim was settled in June 1985 when the company paid Neil the total amount outstanding to his credit.  In October 1985, Neil attempted to sell his shares.  There was a dispute over the sale, and Neil filed proceedings in the High Court seeking to put Waitemata Press Limited into liquidation.  In the event, he was paid $7,500 in exchange for the shares to settle the dispute.

[56]     Neil last had contact with the deceased in 1990, when the deceased called into his work and asked him to work for him again.  Neil asked the deceased whether he would accept his marriage, and whether he was still drinking.   The deceased replied no and yes respectively.  Neil stated that he would talk to the deceased again

about working for him when these matters were addressed.   The deceased never came back to Neil, and they never spoke again, even when the deceased was dying.

[57]     The deceased made various attempts to contact Neil over the years.   Neil wrote to the deceased in 2003 stating that he had made it clear that he did not want the deceased to be involved in his life.  He told the deceased that he did not want him to try and contact him by telephone, letter, or in person, and he did not want him to ask third parties to pass anything on.

[58]     Attempts were again made to broker the peace between Neil and the deceased immediately prior to his death.  The deceased’s brother, Rodney Haines, contacted Neil.  So did one of his cousins.  Neil declined to go and see his father.

[59]     In her affidavit in the Family Court proceedings, Lynne stated that when Raemos Land Development Limited was set up, a Mr Tornquist, who was the deceased’s accountant, and the then company secretary, received 2,000 shares in trust, as to 1,000 for Neil, and as to 1,000 for her.   Lynne received her shares in March 1995, but Neil’s shares were never transferred to him.   Rather they were transferred to the deceased.  Neil commenced proceedings in relation to those shares after the Family Court hearing which is the subject of this appeal, and as noted above, he succeeded in those proceedings.  The District Court in Haines v Tornquist held that he was entitled to 1,000 shares in Raemos Land Development Limited.  He was paid out the value of those shares - $118,000, together with interest, making a total of $131,046.66.   Obviously the value of those shares, and the fact that Neil owned the same, were not taken into account by Judge Doogue in her judgment.

[60]     As a result of the District Court decision in Haines v Tornquist, it seems that

Neil’s assets are in the vicinity of $217,000.

[61]     Whether or not there has been a breach of moral duty is judged as at the date of the deceased’s death:  see, e.g. Re McGregor (dec’d); McGregor v Beattie [1961] NZLR 1077 and Little v Angus at [127]. The wise and just testator is presumed to be fully aware of all relevant circumstances. Moreover, events subsequent to the death of the deceased can be taken into account in assessing the appropriate remedy if a

breach of moral duty (assessed as at the date of death) is established – Henry v Henry

at [59] to [60].

[62]     Given the inter vivos gift of shares in Raemos Land Development Limited, I do  not  consider  that  Neil  was  in  need  of  further  financial  assistance  from  the deceased to meet his economic needs and contingencies.  He is however entitled to say that the deceased breached the moral duty owed to him in that the deceased failed to make provision for his support in the wider sense discussed in Williams v Aucutt, and noted in [33] above.  While Neil did spurn attempts by the deceased to contact him, and attempts to affect a reconciliation shortly before the deceased’s death, on the facts of this particular case, in my view it cannot be said that Neil was responsible for the  estrangement.   Rather it seems to have been the deceased’s dictatorial ways, and failure to compromise, which led to the unfortunate breakdown in  family relationships.   The  Court  should  be  prepared  to  recognise  the  family connection and Neil’s need for acknowledgement.  The estate was built up in large part by the deceased’s hard work, but with the assistance of all of his children from time to time.  The estate represents an accumulation of family endeavours in a sense.

[63]     Neil’s asset position has now been clarified and he is in a relatively strong financial position.  He has no need of further financial assistance but it is appropriate to meet Neil’s need for support (in the sense of sustaining or providing comfort) by an award of a modest amount.   Otherwise Neil will have a justifiable sense of exclusion from participation in the family estate.  In my view, an appropriate award for Neil is the sum of $25,000.

Lynne

[64]     Lynne is not required to justify the bequest made to her, and I therefore do not undertake any further investigation into her position.   She is entitled to the residue of the estate after appropriate awards are made to her siblings.

[65]     I should however deal with Mr Banbrook’s submission that Lynne has been responsible for incurring unnecessary costs.

[66]     There is nothing from the file in the Family Court proceedings to indicate that that was the case.  Indeed the contrary seems to be true.  Lynne accepted from the outset that provision should be made for her brother and sister, and she simply asked to be heard in relation to the form of the Court order.  If anything, I was left with the distinct impression that it was Neil who was not as forthcoming as he should have been in his initial affidavit.

[67]     It  was  suggested  that  Lynne  was  obstinate  at  mediations  which  were conducted.   This submission is not appropriate.   Moreover it is without evidential foundation.

[68]     Nor in my view can any criticism be made of Lynne for testing Neil’s claim in the Haines v Tornquist proceedings.  In my view Lynne as the sole beneficiary of the estate was entitled to put Neil to proof.  Neil could and should have made the claim before the Family Court hearing the subject of this appeal, and the fact that he did not so is a contributing factor to the fact that the Family Court judgment has had to be revisited.

Costs

[69]     All counsel were mindful of the difficulties that have occurred as a result of the order made by the Family Court that the costs incurred in the hearing before it should be met by the estate.   All indicated that they were prepared to accept that costs should lie where they fall.  However, all predicated that acceptance on the basis of their respective contentions as to how the estate should be distributed.

[70]     I have not in this judgment adopted any of the positions advocated by the parties, and therefore it would not be appropriate to hold counsel to the position advanced in argument before me.

[71]     It is nevertheless my preliminary view that costs should lie where they fall.  If the parties wish me to address the matter further, then I direct that the respondents should file any submissions they wish to make within 10 working days of the date of this judgment.  The appellant should file any submissions she wishes to make within

a further period of 10 working days.   The respondents should then file any submissions in reply within a further period of five working days.  I will then deal with the issue.

Wylie J