Application of Perpetual Trustee Company Ltd; Re: Estate of the late Evelyn Mary Dempsey [2016] NSWSC 159 - NSWSC 2015 case summary — Zoe

NSWNSWSC

Application of Perpetual Trustee Company Ltd; Re: Estate of the late Evelyn Mary Dempsey [2016] NSWSC 159

[2016] NSWSC 159

Supreme Court of NSW|2015-11-13|Before: Slattery J

View original source

At a glance

Source facts

Court

Supreme Court of NSW

Decision date

2015-11-13

Before

Slattery J

Source

Original judgment source is linked above.

Judgment (32 paragraphs)

[1]

807 Hyland v Hyland (1971) 18 FLR 461 In the Marriage of Henry (1995) 19 Fam LR 227 Jamison v Commissioner for Internal Revenue (2007) 210 FLR 210 Macedonian and Orthodox Communities Church St Petka Inc v His Eminence Petar the Diocesan Bishop of the Macedonian Orthodox Diocese of Australia and New Zealand (2008) 237 CLR 66; [2008] HCA 42 Pipon v Pipon (1744) Amb 25; 27 ER 14 Plummer v Inland Revenue Commissioners (1988) 1 All ER 97 Re Allsop (1914) 1 Ch 1 Re Cartier (1952) SASR 280 Re McKenzie (1951) 51 SR (NSW) 293 Re Maldonado [1954] P 223 Re Terry (deceased) Terry v Guardian Trust and Executors Co Ltd [1951] NZLR 30 Texts Cited: M Dirkis, "Being Caught up by the Past - the Enforcement of Foreign Revenue Debts" (2009) 19(1) Revenue Law Journal 1-6 GL Certoma, The Law of Succession in New South Wales (4th ed 2010, LawBook Co Thomson Reuters) JD Heydon, MJ Leeming, Jacob's Law of Trusts (7th ed 2006, LexisNexis Butterworths) JHG Sunnucks, JG Ross Martyn, KM Garnett, Williams, Mortimer and Sunnucks on Executors, Administrators and Probate (16th ed 1982, Stevens) M Davies, AS Bell and PLG Brereton, Nygh's Conflict of Laws in Australia (9th ed 2014, LexisNexis Butterworths Australia) Category: Principal judgment Parties: Plaintiff: Perpetual Company Ltd in the estate of Evelyn Mary Dempsey Representation: Counsel: Plaintiff: M. Meek SC

[2]

Solicitors: Plaintiff: David Robert Samuel Creais, Bartier Perry File Number(s): 2015/258459 Publication restriction: No

[3]

Judgment

The principal point at issue in these proceedings is whether the plaintiff, the Perpetual Trustee Co Ltd ("Perpetual"), would be justified in distributing the intestate share of the estate of the late Evelyn Mary Dempsey ("the deceased") on the basis that the deceased's domicile at the date of her death was New South Wales. The plaintiff seeks the opinion advice and direction of the Court pursuant to Trustee Act 1925, s 63 on that question and on a number of other matters related to the administration of the deceased's estate.
The deceased was born in Queensland on 20 August 1894 and died in England on 18 October 1982 at the age of 88. At her death she left an Australian will dated 1 April 1968 which appointed the Permanent Trustee Company of New South Wales ("Permanent") as her executor and trustee. Probate of the will was granted to Permanent by the Supreme Court of New South Wales on 18 May 1983. An intestacy as to part of the residue of the estate has complicated the estate's administration.
The plaintiff, Perpetual, is the corporate successor to the estate assets and liabilities of Permanent in respect of the administration of this estate. It has commenced proceedings seeking judicial advice in respect of aspects of the administration of the estate.
The principles that apply to judicial advice applications are well known. The High Court extensively examined and restated the relevant principles in Macedonian and Orthodox Communities Church St Petka Inc v His Eminence Petar the Diocesan Bishop of the Macedonian Orthodox Diocese of Australia and New Zealand (2008) 237 CLR 66; [2008] HCA 42 ("Macedonian Orthodox"). The Court's jurisdiction under Trustee Act, s 63 is enlivened by questions with respect to the management or administration of the trust property: Macedonian Orthodox, at [58].
The Court also has general equitable jurisdiction to give such advice: Application of Macedonian and Orthodox Community Church St Petka Inc (No. 2) (2005) 63 NSWLR 441; [2005] NSWSC 558, per Palmer J at [23].

[4]

General Background to the Issues

The general background to the main questions for the Court's advice may be shortly stated. First, the deceased was born in Queensland. But she seems to have spent much of the second half of her life in England and in New South Wales. There is an intestacy in respect of one half of the residue of her estate. At her death her estate consisted of shares in an Australian corporate register and investments in the plaintiff's common investment funds in New South Wales. The distribution of the deceased's movable property upon an intestacy, whether the distribution is to the deceased's relatives or to the State, depends upon her domicile: Pipon v Pipon (1744) Amb 25; 27 ER 14 and Re Maldonado [1954] P 223. The Court is therefore asked in the circumstances set out in the Statement of Facts: whether the plaintiff-executor would be justified in distributing her intestate estate on the basis that she was domiciled in New South Wales.
Secondly, the capital of and the income earned on half the residue of the deceased's estate was to be paid under her will to the University of Sydney ("the University") for Cancer research. The other half of the residue was subject to the intestacy. After the deceased's death the plaintiff set up accounts to manage the payment of monies from the estate residue to the University (the Residue Account) and an account to set aside funds for the half share of residue that was the subject of the intestacy (the Intestacy Account). After the deceased's death the plaintiff regularly paid income earned on the residuary estate to the University. But in May 1994 the plaintiff apparently overpaid the University the sum of $25,363.64 by mistake: the sum represents a tax refund from the Australian Taxation Office, which it is said should only have been credited to the part of the estate that was subject to a tax liability, namely the half share subject to the intestacy, not the half share to which the University was entitled. Instead, part of the refund was wrongly credited and paid to the University. The plaintiff corresponded with the University after the error. But the plaintiff was not able to secure the University's agreement to the repayment of the sum. The plaintiff has since taken the course of retaining the disputed sum together with interest earned from time to time in the Residue Account, rather than distributing it to the University. The plaintiff seeks judicial advice as to whether it is justified in taking the course of transferring this sum to the Intestacy Account.
Thirdly, a small part of the deceased's assets at the time of her death was located in the United Kingdom. Since the time of her death the United Kingdom assets have increased substantially in value. But United Kingdom inheritance tax liabilities applicable to the deceased's estate substantially exceed the value of these assets. The plaintiff seeks judicial advice as to whether it is justified in abandoning the United Kingdom assets.
The plaintiff raised other matters consequential upon the judicial advice sought. These other matters can await the plaintiff's consideration of the Court's advice on the principle matters.

[5]

The Summons for Advice

The questions on which the plaintiff seeks judicial advice in its 3 September 2015 Summons are the following. a. would the plaintiff be justified in distributing the intestate share of the deceased's estate on the basis that the deceased's domicile at the date of her death was New South Wales? b. if the answer to a. is no, would the plaintiff be justified in distributing the intestate share of the deceased's estate on the basis that the deceased's domicile at the date of her death was Queensland or alternatively the United Kingdom? c. in relation to an overpayment of $25,363.64 to the University of Sydney is the plaintiff justified in transferring an amount of $25,363.64 and appropriate interest from the University share of accumulated interest currently held in the estate Residue Account administered by the plaintiff to the estate Intestacy Account administered by the plaintiff? d. would the plaintiff be justified in distributing the Australian estate of the deceased to the estate beneficiaries without regard to any or all of the United Kingdom taxation liabilities that may be payable by the estate? and e. advice in relation to payment of Australian tax and any adjustments as between the Residue Account and the Intestacy Account consequent on the advice of the Court given regarding the deceased's domicile at the date of her death.
In accordance with the applicable procedure, the plaintiff provided the Court with a Statement of Facts upon which it asked for the judicial advice. That statement has been marked as an exhibit in the proceedings. The Statement of Facts summarises a large number of underlying documents held by the plaintiff and it provides general background information concerning the deceased's will and the administration of her estate as well as specific information relevant to the questions for judicial advice. Based closely on the Statement of Facts and the Exhibits tendered, these reasons first set out the general background. Then these reasons deal with the facts more closely relevant to each of the questions before the Court. The facts set out below are derived from the Statement of Facts and the Exhibits. Some uncertainty in the matters summarised in the Statement of Facts results from lack of clarity in and the limited nature of the original materials being summarized, some of which have been lost.

[7]

The April 1968 Will

The deceased's April 1968 will provided a number of legacies both of a personal and a charitable nature. These legacies were principally directed to persons and institutions in Australia, rather than in the United Kingdom. The legacies were the following: 1. to the Priest in Charge for the time being of the Catholic Parish at Innisfail Queensland, $600 to be used for the purposes of repairing, adding to or rebuilding churches or schools in the said Parish in such manner as the said Priest shall determine; 2. to the said Priest, $400 upon trust to apply the same for Masses for the repose of the deceased's soul with a direction that this legacy shall be paid as soon as possible after her death and in priority to all other bequests; 3. to the Superior of the Farm Street, Jesuit Church London W.1., $800 for the general purposes of that Church; 4. to the Sister in charge for the time being of the Public Hospital in Brisbane known as the "Mater Misericordiae", $400 for the use and benefit of the said Public Hospital; 5. to the Treasurer for the time being of Marist Medical Mission of Sydney, $600 to be devoted to the furtherance of the objects of the said Mission; 6. to Neil Fitzgerald of Brisbane, a Crystal necklace and $400; 7. to Paula Fitzgerald of Brisbane, $400; 8. to Cicely Mooney of Elizabeth Bay near Sydney, $1,600 and two Strings of Pearls and Pearl Earrings; 9. to Marjorie Britten, sister of the said Cicely Mooney, $600; 10. to Mrs Sidney Palmer the wife of Sidney Palmer, Architect of Wollongong and Sydney, $1,200, two Diamond Brooches and a Diamond Wristlet; 11. to Sarah Palmer, daughter of the said Mrs Sidney Palmer, $600; 12. to the deceased's friend Mrs Eve Carroll of 39 Hill Street London W.1., $600; 13. to the Royal NSW Institute for Deaf and Blind Children, $600; and 14. to the Senate of the University of Sydney for the purposes of Cancer Research, $600.
The residue of the estate was held on trust to be divided into two equal shares. The will provided for both the shares of residue to be given to Australian recipients, one individual and one institutional. The residue was to be held in the following manner: 1. As to one share for Kathleen O'Brien of Milsons Point; 2. As to the other share, to pay the income arising therefrom to Cecil O'Brien, the brother of the said Kathleen O'Brien, during his life and after his death to pay and transfer both the capital and income of that share to The University of Sydney (University) to be applied for the purpose of cancer research."

[11]

Progress of the Estate's Administration

Shortly after the deceased's death on 18 October 1982, the plaintiff wrote on 21 October 1982 to Norton Smith & Co, Solicitors of Sydney, informing them of the death and requesting the deceased's original will. By 24 May 1983 Norton Smith & Co forwarded a Victorian Probate Duty Return to the plaintiff for completion, execution and return. The plaintiff returned the completed Victorian Probate Duty Return on 27 May 1983. The plaintiff holds an unsigned office copy of a Declaration that had been prepared for Victorian Probate Duty purposes, which records the State or Country of Domicile of the deceased as Australia. On 19 August 1983 Norton Smith & Co informed the plaintiff that Victorian Probate Duty had been assessed at $500.67 and requested payment. It is to be inferred that the payment of probate duty was made in accordance with the Victorian Probate Duty Return.
By letter dated 10 November 1983 HM Inspector of Taxes (UK) informed the plaintiff that completed tax returns from 6 April 1981 to 5 April 1982 and from 6 April 1982 to 18 October 1982 were required in respect of the deceased and requested a copy of the probate and her will. A reply was sent on 9 April 1984 advising the HM Inspector of Taxes (UK) that there were legal questions to be resolved by Permanent.
From an early time in the estate's administration, the plaintiff established estate accounts and held all estate assets and all income from those assets left after the payment of legacies in an account that the plaintiff administered entitled "Estate late Evelyn Mary Dempsey Residue Account" ("the Residue Account").
On 30 November 1987 the plaintiff made an interim distribution from the Residue Account of $2,622,540.84. This distribution was partly in specie in shares and partly cash. The University's one-half share of estate residue ascertained to that date was distributed directly to it at this time.
But the issues concerning the distribution of the other half of the residue of the estate were still unresolved. So when the November 1987 distribution took place, the plaintiff transferred the other one-half share of residue into an estate account named "Estate late Evelyn Mary Dempsey Partial Intestacy Account" ("Intestacy Account"), pending resolution of all the issues associated with the intestacy.
A further capital distribution of $39,348.20 was made into the University Account and into the Intestacy Account on 26 April 2000.
A little over five years after the deceased's death, in or around 2 December 1987, the plaintiff informed the University that with the exception of the UK assets the estate had been distributed. This letter referred to an agreement by the University to the abandonment of the UK assets, because of the incidence of UK capital transfer taxes which would be attracted on all of the estate assets if the plaintiff sought to deal with the UK assets.
On 1 March 1988 the plaintiff forwarded a cheque for $15,194.83 to the University, with advice that this payment completed the administration of the estate except for the UK assets, which the University had previously agreed should be abandoned. The letter stated that the plaintiff would continue to receive dividends from the bank shares on London public company Registers, which would be distributed from time to time as they were received. The University's agreement to the course of abandoning the UK assets is not recorded in the plaintiff's file in any document signed on behalf of the University itself. Nevertheless the University's contemporaneous assent to such a course can readily be inferred from the repeated correspondence to the University on the subject asserting an agreement and the lack of any adverse comment in response from the University.
Notwithstanding that no grant in relation to the deceased's estate had been obtained in the UK, income distributions from certain UK shares were paid to the plaintiff, which in turn distributed the income so received to the University and to the Intestacy Account until 26 April 2000. After that date income from the UK shares was accumulated in the Residue Account and no further distributions were made. As at 13 April 2015 the value of the Residue Account was $564,049.21, consisting of Australian assets of $217,940.96 and estimated UK assets of $346,108.25.
On 18 April 1988 the Official Solicitor (UK) requested the plaintiff by letter to reconsider obtaining a grant of probate in the UK. The letter enclosed a letter dated 17 December 1987 from HM Inspector of Taxes (UK) to the Public Trustee Office (UK) which stated that income tax matters to the date of the deceased's death were finalised based on the assumption that most of the estate assets would be distributed in Australia. The file was put into storage and no further action taken in relation to the income tax liability of the deceased up to the date of death.
On 21 April 1992 the Public Trust Office (UK) informed the plaintiff by letter it was holding funds in excess of £12,000 and if the plaintiff formed the view that it would be unable to carry out the administration of the estate, the Public Trust Office (UK) would contact the beneficiaries of the Will to advise them of the position.
On 7 June 1993 the Public Trust Office (UK) informed the plaintiff by letter that it had written to the University to ask if the University would be willing to act as administrator of the UK estate.
In the meantime the plaintiff had been making inquiries about the next-of-kin of the deceased. To this end by letters dated 30 May 1994 the plaintiff requested registry searches from the Queensland Registrar General's Office and the NSW Registry of Births Deaths & Marriages.
On 6 March 1995 the University forwarded a copy of a letter dated 24 February 1995 from the Public Trust Office (UK) to the University in which the Public Trust Office had asked whether the University would be willing to administer the UK estate, then valued at £89,000. The University asked the plaintiff to provide it with written advice as to its options.
On 3 August 1995 the plaintiff wrote to the University indicating that the plaintiff would instruct UK agents, Barclays Bank Trust Company Ltd, to investigate the feasibility of taking out a UK grant of probate.
On 4 August 1995 the plaintiff requested Barclays to provide an estimate of taxes or duty payable in the UK, if a grant or reseal were taken out in that jurisdiction.
On 10 August 1995, Barclays informed the plaintiff that from the inventory provided to it, Barclays would assume that the deceased was domiciled in the UK at the date of her death and in that case the Inland Revenue would seek to levy inheritance tax on the worldwide estate. If on the other hand the deceased was not domiciled in the UK, the Inland Revenue would only levy inheritance tax on the assets held in the UK.
On 17 September 1997 Barclays informed the plaintiff that it appeared that what was described as "capital transfer tax" applicable to the deceased's UK assets still exceeded the value of the UK assets and would have amounted to £176,079.80 at date of death. The letter stated that on the information supplied, there was little prospect that the tax could be limited to the assets held in the UK. Barclays were presumably continuing to assume that the deceased had died domiciled in the UK rather than in Australia.
On 5 February 1998 the plaintiff informed the Public Trust Office (UK) that having examined the feasibility of taking out a grant of probate in the UK, taxation issues would render applying for a reseal an unviable option.
On 10 March 1998 the plaintiff informed Windeyer Dibbs, Solicitors of Sydney that it had decided not to take out probate in the UK due to the tax that would be payable there and requested advice from Windeyer Dibbs on the other options available on the basis that the plaintiff could not abandon the assets in the UK, nor could it distribute them, and the estate was still receiving dividends from the UK.
By letter dated 27 March 1998, Windeyer Dibbs advised the plaintiff: 1. Provided the plaintiff were satisfied there is no beneficiary entitled to the intestate share of residue, the monies the plaintiff is holding should be paid to the Crown immediately. Windeyer Dibbs further advised that whilst the plaintiff was retaining these monies it could perhaps be suggested that the plaintiff is improperly benefiting from its position as it is presumably claiming commission on funds that should already have been transferred to the Crown. 2. With regard to the UK estate, if necessary a grant of representation should be obtained in the UK and assets paid to the UK revenue authority in part satisfaction of the liability there to capital transfer tax. 3. Windeyer Dibbs' understanding at the time of its advice to the plaintiff was that the UK Government would not look to those assets of a person that are situated outside the UK for payment of UK tax. Windeyer Dibbs observed that whilst that remains the case there will be no claim by the UK for payment of tax from Australian assets; and this is just as well, because if the UK were to look to assets outside the UK for payment, there would have already arguably been an excess distribution to the University.
In summary, the Windeyer Dibbs advice was that the amount held in the Intestacy Account should be paid to the Crown and the UK assets should be paid in part payment of capital transfer tax due in the UK, after first obtaining a grant of representation in the UK, if necessary.
The plaintiff's instructions to Windeyer Dibbs were that there was an intestacy in respect of a one-half share of the estate, which therefore passed to the Crown. But the Windeyer Dibbs advice back about payment to the Crown was predicated upon the assumption that the plaintiff was satisfied that there was no beneficiary entitled to the intestate share of residue. It is necessary to examine the basis for this assumption and whether there was a proper basis for making it.

[12]

Domicile, Intestacy and a Summary of the Searches for Statutory Next-of-Kin

As earlier indicated in these reasons, the domicile of the deceased governs the applicable law in relation to the passing of her movable property on intestacy. As at the date of the deceased's death there was an important difference between the entitlement of statutory next-of-kin on intestacy in New South Wales and their entitlements in Queensland, in a situation where, as was the case here, the deceased left no spouse, no issue, no parents and no siblings.
The position in New South Wales, at the date of the deceased's death, was governed by the Wills, Probate and Administration Act 1898, s 61B (6) (d) and (e). This provided for aunts and uncles of the full blood and the half-blood to take in these circumstances. But it excluded the issue of aunts and uncles (namely cousins) if all the aunts and uncles were dead at the date of death of the deceased. These provisions were relevantly as follows: "(6) If the intestate leaves no spouse, no issue and no parents, the estate shall be held for the following persons living at the death of the intestate and in the following order and manner: … (d) fourthly, in trust for the uncles and aunts of the intestate (being brothers or sisters of the whole blood of a parent of the intestate) and, if more than one of them survive the intestate, in equal shares; but if there are no such uncles or aunts, then (e) fifthly, in trust for the uncles and aunts of the intestate (being brothers or sisters of the half blood of a parent of the intestate) and, if more than one of them survive the intestate, in equal shares."
The Queensland position was different in October 1982. The law of that State allowed surviving cousins at the date of the deceased's death to take in the circumstances that all the aunts and uncles were dead. The statutory next-of-kin entitled on intestacy was governed in Queensland by Schedule 2, Part 2 and s 37 of the Succession Act 1981 (Qld). These provisions also barred entitlements to an estate beyond cousins living at the time of the death of the deceased. Schedule 2 relevantly provided as follows: "DISTRIBUTION OF RESIDUARY ESTATE ON INTESTACY Part 2 Intestate not survived by any spouse Circumstance Way in which the intestate's residuary estate is to be distributed 1 Where the intestate is survived by issue The issue are entitled to the whole of the residuary estate in accordance with section 36A. 2 Where the intestate is not survived by issue but is survived by a parent or both parents The parent is entitled to the whole of the residuary estate or, if both parents survive the intestate, the parents are entitled to the whole of the residuary estate in equal shares. 3 Where the intestate is not survived by issue or by a parent but is survived by next of kin The next of kin are entitled to the residuary estate in accordance with section 37. 4 Where the intestate is not survived by issue, by a parent or by next of kin The residuary estate shall be deemed to be bona vacantia and the Crown is entitled to it.

[13]

Succession Act 1981 (Qld), s 37 provided as follows: "37 Distribution of next of kin's entitlement (1) Where, by virtue of this Act, the next of kin of an intestate are entitled to the residuary estate of the intestate, the persons entitled to that residuary estate shall be ascertained in accordance with the following paragraphs - (a) the brothers and sisters of the intestate who survived the intestate, and the children of a brother or sister of the intestate who died before the intestate, being children who survived the intestate, are entitled to the residuary estate of the intestate; (b) if the intestate is not survived by any persons entitled to the residuary estate under paragraph (a) but is survived by 1 or more of his or her grandparents - the grandparent is entitled to the residuary estate of the intestate, or the grandparents are entitled to the residuary estate in equal shares, as the case requires; (c) if the intestate is not survived by any persons entitled to the residuary estate under paragraphs (a) and (b) - the uncles and aunts of the intestate who survived the intestate and the children of an uncle or aunt who died before the intestate, being children who survived the intestate, are entitled to the residuary estate of the intestate. (2) The residuary estate of an intestate shall be divided amongst - (a) the brothers and sisters of the intestate and the children of those brothers or sisters who died before the intestate, in the same manner as the residuary estate would have been divided amongst those persons, if the brothers and sisters had been children of the intestate and the children of a brother or sister who died before the intestate had been children of a child of the intestate who died before the intestate; or (b) the uncles and aunts of the intestate and the children of those uncles or aunts who died before the intestate, in the same manner as the residuary estate would have been divided amongst those persons if the uncles and aunts had been children of the intestate and the children of an uncle or aunt who died before the intestate had been children of a child of the intestate who died before the intestate. (3) However, the said residuary estate of the intestate shall not be divided amongst the issue of a brother or sister or of an uncle or aunt who died before the intestate more remote than the children of any such brother or sister, uncle or aunt."
The provisions of Wills, Probate and Administration Act 1898 s61B (6) (d) and (e) were repealed by Succession Act 2006 in this State and replaced within the Succession Act in s131, in a form that now closely conforms with the Queensland position.
The UK law governing the passing of property on intestacy applicable in 1982 where the deceased died without spouse, child, or parents has not been fully examined on this application. The English probate and administration text published closest to the date of the deceased's death is the 1982 edition of JHG Sunnucks, JG Ross Martyn, KM Garnett, Williams, Mortimer and Sunnucks on Executors, Administrators and Probate (16th ed 1982, Stevens). Referring (at 239 -241 and 1011-1012) to the Administration of Estates Act 1925 (UK) s 47 (5), Williams opines that the statutory position in the UK at that time was that the most remote class of next-of-kin who might take on intestacy are uncles and aunts of the half-blood but not their issue or the issue of aunts and uncles of the full blood. This would have been the same rule as would have applied in New South Wales.
It is not necessary for present purposes to go further into the UK position as at October 1982. The fact that one potentially arguable domicile of the deceased, Queensland, allowed cousins who survived the deceased to take upon an intestacy as to part of her estate is reason to investigate whether any cousins did survive the deceased.

[14]

The Deceased's Next of Kin - Discussion of the Legal Position

The plaintiff has prepared a family tree of the deceased's next of kin. Considerable work has been put into the preparation of this document, which has proved very useful for the Court. The full family tree is not reproduced in these reasons but some aspects of it are worthy of closer examination.
The first issue presented for the Court's consideration is whether the plaintiff is justified in distributing the estate upon the basis that the deceased was domiciled either in New South Wales, Queensland, or the United Kingdom. As appears from the reasons below the Court is generally satisfied on the materials presented to it, and if nothing else emerges, that the plaintiff would be justified in distributing this estate on the basis of the deceased's having Australian domicile and not United Kingdom domicile. But within Australia there are some indications that the deceased may have retained her domicile of origin in Queensland. So the Court has recommended that further investigations take place in relation to the next-of-kin in Queensland before advising whether the plaintiff would be justified in distributing the estate on the basis that the deceased was domiciled in this State.
But the significant delay in the administration of this estate is troubling. This is not a criticism of the present counsel or the solicitors who appeared for the plaintiff in these proceedings. In fact whatever past delay may have occurred within the plaintiff's internal administration, it is quite clear to the Court that since the present legal advisers have been involved with this estate they have undertaken a careful and efficient examination of the files and materials in the plaintiff's possession relevant to the deceased. The Statement of Facts makes clear that these files contain many obscurities. As a result of the delay that has occurred, the Court has been left with an incomplete picture of the deceased's next of kin and of her movements in the second half of her life. It is likely that had proper enquiries been made in the 1980s about the deceased's movements in the 1960s and 1970s a better picture would have emerged compared with that now available to the Court.
Because of the uncertainties in this case the Court is not prepared to advise the plaintiff that it can immediately distribute the estate on the basis that the deceased had a New South Wales domicile, unless an opportunity is afforded to anyone who, even now, can be found who may have an interest in arguing that the deceased was domiciled in Queensland to advance evidence to support that conclusion. But if the deceased were domiciled in Queensland, as distinct from New South Wales, at the time of her death, examination of her family tree shows that there are a limited number of people, namely the executors of four paternal cousins living at the date of her death, who would have an interest in gathering and presenting material that may suggest that the deceased had a domicile in Queensland, no doubt at the behest of the beneficiaries of their wills, or their descendants. Further limited enquiries should be made at least to the point of providing an opportunity for such people to come forward. The opportunity will have to have reasonable time limits placed upon it.
What is expected is discussed in more detail later in these reasons. But for the present the focus turns to who are the other people who might be found who may have an interest in asserting that the deceased was domiciled either in Queensland or even in the United Kingdom. In short the persons with this interest are certain descendants of relatives of the deceased in Queensland and the UK revenue authorities.

[15]

The Deceased's Next of Kin - Who are they?

The present counsel and solicitors for plaintiff have directed the undertaking of an extensive examination of the deceased's family trees. Their work has been useful.
The deceased did not marry and had no issue. She was the only child of Timothy Dempsey and Mary Catherine Dempsey, nee O'Brien. The deceased's parents were married on 4 March 1893 and died long before her death. The deceased's father died on 31 August 1916. The deceased's mother died on 20 January 1923.
The deceased's birth certificate (Exhibit A) shows that her father Timothy was aged 42 at the time of her birth. He was a plantation manager who had been born at Tutton, in County Tipperary in Ireland. The deceased's mother, Mary was 29 and had been born in Clonmell in County Tipperary. The deceased's father came to Queensland at the age of 16 and died after 50 years at the age of 66.
The object of an enquiry into the deceased's next of kin is to determine whether, had the deceased been domiciled in, for example, Queensland, her movable estate might have passed upon intestacy under Queensland law to any person or persons living at the time of her death.
The result of the plaintiff's and the Court's preliminary analysis of this topic shows that there are at least four cousins on the deceased's paternal side who would have taken upon an intestacy were the deceased domiciled in Queensland at the time of her death. There may be more. These same persons may possibly have taken upon intestacy if the deceased were domiciled in the United Kingdom at the time of her death, depending exactly on the relevant law in the UK at the time. These cousins of the deceased who survived the deceased, according to the evidence gathered so far, by up to about 15 years.
The Court's short examination of the deceased's family tree commences on the paternal side. For basic reasons of economy this judgment does not set out the full family tree of the deceased's relatives. Nevertheless it does expand upon the parts of the family tree that are more relevant to the present enquiry. The publication even of these parts of the family tree in these reasons should assist the plaintiff with its further enquiries that these reasons suggest be undertaken.

[16]

The Deceased's Paternal Grandparents and their descendants

The deceased's paternal grandfather was James Dempsey. Her paternal grandmother was Bridget Dempsey, nee Geehan.
James Dempsey married Bridget Geehan on 6 February 1844. She died on 11 April 1885. He died on 26 September 1889. They had eight children. Apart from the second eldest, Timothy, who was the deceased's father the others, the deceased's paternal uncles and aunts, were in birth order: Joseph, Timothy (the deceased's father), Catherine, Johanna Mary, James, Bridget, John and Michael.
Importantly for present purposes, the children of two of those children, namely the children of the eldest Joseph and the children of a male child in the middle of the family, James, actually survived the deceased. These were the deceased's paternal cousins. The plaintiff's research sufficiently establishes that all but one of the other paternal aunts and uncles of the deceased did not have children that survived the deceased, as their identities and dates of death can all be ascertained. But it is uncertain whether one of them, Michael, the youngest had any children or not and therefore it is not known whether he had any children who survived the deceased. The focus thus turns to the families of Joseph and James Dempsey. The children of the other aunts and uncles of the deceased are not discussed in these reasons because the Court is satisfied on the available evidence that they did not have children who survived the deceased.
Joseph Geehan Dempsey, the eldest brother of the deceased's father, married Bridget Mara in 1885. He died on 31 December 1907. He and Bridget had three children: Winifred Mary Dempsey, who died in Queensland on 23 January 1890 leaving no issue; Margaret Annie Dempsey, who was born in 1890 and whose date of death and whether she left issue is unknown; and Joseph Dempsey who was born in 1887 and whose date of death and whether he left issue is unknown.
James Dempsey died in Queensland on 27 March 1924. He had married Mary Ellen Barker on 17 June 1890. They had seven children. The eldest four did not survive the deceased. They were: Eileen Millicent Dempsey who died in Queensland on 13 October 1966; William John Dempsey who died in Queensland on 26 September 1977; James Dempsey who died in Queensland on 7 June 1981; and Gladys Dorothy Dempsey who died in Queensland on 18 October 1980.
But the youngest three cousins of the deceased from James' family did survive the deceased. They were: Edna Kathleen Dempsey, who married William Wells (a second marriage) in 1961 and died in Queensland on 19 October 1985 leaving 2 children; Beryl Thelma Dempsey, who married Archibald Stanley Irvine in 1922 and died in Queensland on 23 September 1991, leaving 3 children; and Noel Vincent Dempsey who died in Queensland on 30 May 2001, leaving one child.
The youngest child of James and Bridget Dempsey, Michael Dempsey is believed to have died in Queensland in 1933 and on the materials available to the Court, it is not clear if he left issue.

[17]

The Prior Marriage of the Deceased's Paternal Grandfather

There are half uncles and aunts of the deceased on the paternal side. These relationships arise because prior to his marriage to Bridget Geehan, James Dempsey married Julia/Johanna Ryan in Ireland before he emigrated to Australia. It is believed Julia/Johanna Dempsey, nee Ryan, died in Ireland before 1844. The potential legal entitlements of these cousins have not been fully analysed or investigated, as their entitlements under the Queensland law that applied at the time of the deceased's death were not explored in submissions before the Court. But on the basis that they may perhaps have entitlements, they are briefly mentioned here. Importantly one of the deceased's cousins from this family did survive the deceased.
The issue of the marriage of James Dempsey and Julia/Johanna Dempsey appear to be: William, Mary and Edward: these are great uncles and aunts of the deceased in the half blood. William Dempsey died in Queensland on 19 August 1889 without issue. Mary Dempsey was born in 1840 but the date of her death has been unable to be established by certificate evidence and it is not clear if she left issue.
Edward Dempsey, the other uncle of the deceased in the half blood on the paternal side, married Louise Mary Darcy in Queensland in 1890. He died in Queensland on 15 October 1904. It appears they had six children, one of whom, the second youngest Louisa Regina, survived the deceased. They were the following: Kathleen Mary Dempsey who died in Queensland on 25 October 1974 leaving 4 children; Edna Louisa Dempsey who died in Queensland on 25 November 1977 leaving no issue; Edmund Kerwin Dempsey who died in Queensland on 26 September 1951 leaving no issue; Lillian Diamond Dempsey who died in Queensland on 2 March 1899 leaving no issue; Louisa Regina Dempsey who married Robert George Mort Hamilton in 1924 and remarried in 1946 to Robert Augustin Mackie, died in Queensland on 26 April 1988, leaving no issue who survived her; and, James Kevin Darcy Dempsey who died in Queensland on 28 June 1925 leaving no issue.

[18]

The Deceased's Maternal Grandparents

None of the deceased's maternal aunts or uncles survived her. And none of her maternal cousins survived her.
The deceased's maternal grandfather was Michael O'Brien. The deceased's maternal grandmother was Catherine O'Brien, nee Anglin. Michael O'Brien married Catherine Anglin on 8 February 1853. Catherine O'Brien, nee Anglin, died on 1 June 1891. Michael O'Brien died on 11 June 1895.
Michael O'Brien and Catherine O'Brien appear to have had seven children of whom the deceased's mother was the third eldest. Apart from the deceased's mother these children were the deceased's aunts and uncles. They were the following: Patrick, John, Mary Catherine (the deceased's mother), Michael Joseph, James, Ellen and David. The relevant family history of these maternal aunts and uncles may be shortly summarised.
Patrick O'Brien died in Queensland in 7 January 1922 without issue.
John O'Brien married May Ann O'Shea in 1887 and had nine children, who were the deceased's cousins. But none of them survived her. John O'Brien died in Queensland on 17 June 1928.
Mary Catherine O'Brien (the deceased's mother) died in Queensland on 20 January 1923.
Michael Joseph O'Brien died in NSW on 24 September 1914. He had married Catherine Mary McCoy in Queensland in 1889. They had four children, Elsie Mabel, Kathleen Mary, Sidney William and Cecil Joseph. None of these four survived the deceased. But the children of this family had a special place in the deceased's life. Two of them took substantial benefits under her will, Kathleen and Cecil. Kathleen, the second eldest of this family died in March 1976, a little over six years before the deceased's death. The will gave her half the residuary estate. Her death without the will being subsequently altered, resulted in the partial intestacy with which the Court is now concerned. Cecil, Kathleen's younger brother predeceased the deceased by only a few years, in August 1977. He was entitled to a life estate in the other half of estate residue that went to the University under the 1968 will. The deceased did not alter her will after 1968. Her failure to give instructions to alter her will to account for the deaths of these two close cousins is curious. It could indicate that she was already in poor physical and mental health by the mid 1970s. This inference is consistent with the medical records after the deceased was admitted into psychiatric care in November 1978. The medical history reported as at June 1979 was that she had by then been suffering the disorder that led to her admission for 18 months. This possibly takes her illness back into late 1977, early 1978. It may have been even earlier. It is difficult to accept that someone did not try and inform the deceased of the deaths of these two cousins. The provisions of the will are a basis to infer she was the closest to them of all her extended family. This evidence may be quite important on the issue of the deceased's domicile. She turned 80 in 1974. It may be that she had insufficient independence of will and movement from the mid-1970s for any reliable inferences to be drawn about her intention to acquire a domicile of choice in the UK or elsewhere.
James O'Brien died in Queensland on 16 February 1900 leaving a child, James Henry O'Brien who died on 5 December 1900. Ellen O'Brien died in Queensland on 11 June 1865 without issue. David O'Brien died in Queensland on 18 May 1868 without issue. Somewhat unusually another subsequent child of the family was also named David, perhaps after the earlier child who died as an infant. The second, David O'Brien died in NSW on 2 September 1934 without issue.
The genealogical information recorded above in this section is derived from searches the plaintiff initiated. But what will become clear from the course of the plaintiff's searches is that although there were Queensland cousins of the deceased alive up to some nineteen years after her death (1982 to 2001), searches for them were not initiated in Queensland until well after they had all died.

[19]

Searches for Next-of-Kin in New South Wales and Queensland

The plaintiff commenced New South Wales based searches for the deceased's next-of-kin within approximately five years of her death. But there was considerable delay before similar searches were undertaken in Queensland.
In relation to statutory next-of-kin entitled on intestacy in NSW, on 25 November 1987 the plaintiff engaged Clark Consultants Pty Ltd Genealogists of Sydney and instructed it that the deceased died partially intestate and that proofs would be required to ascertain the destination of the funds not disposed of by the will. Clark Consultants was requested to obtain the proofs or make the necessary searches.
On 23 January 1988 Clark Consultants provided the plaintiff with the results of its genealogical searches.
On 26 February 1988 the plaintiff requested Clark Consultants carry out further genealogical searches in relation to the NSW statutory next-of-kin entitled on intestacy in NSW. The conclusion that seems to have been reached as a result of these searches, to the extent that it is clear from the Statement of Facts, is that the partial intestacy in the deceased's estate would result in one-half of the deceased's residuary estate passing to the NSW Crown as bona vacantia. This seems to have been based on an assumption that the deceased was domiciled in New South Wales.
This assumption seems first to have been questioned, at least hypothetically, in 2013. I infer that when external legal advisers, the present solicitors and counsel, were instructed about this issue that this sensible course was taken. In 2013 the plaintiff instructed Worthington Clark Pty Ltd to carry out further genealogical searches in relation to the statutory next-of-kin potentially entitled on intestacy in Queensland. As a result of this research Worthington Clark's research and the analysis of the evidence in these reasons at least four cousins of the deceased have been identified who survived her; with the first three being full blooded cousins and the last in the half blood. These four were: 1. Edna Kathleen Dempsey; 2. Beryl Thelma Dempsey; 3. Noel Vincent Dempsey; and 4. Louisa Regina Dempsey.
Without further research it is uncertain how many other cousins, in addition to these four named cousins, may have survived the deceased. But if any the numbers are likely to be limited. The uncertainty about the identity of the cousins who may have survived the deceased seems to lie entirely on the deceased's paternal side. As the survey in the last section shows, all the cousins on the deceased's maternal side seem to have been accounted for as not surviving her. On her paternal side the other cousins who potentially may have survived her are any children of the deceased's full-blooded uncle Michael and any children of her half-blooded aunt Mary. In the longer term it will probably be necessary to investigate these issues. But this should not hold up whatever primary investigation and action that may need to take place based on the four known surviving cousins. All the unknown surviving cousins would have the same potential interest in the estate as the known cousins. Should litigation arise Equity can readily fashion representative orders for them as a class deploying Uniform Civil Procedure Rule 7.6.
In 2014 the plaintiff engaged Worthington Clark to carry out further searches to identify the legal personal representatives of the four cousins who were known to have survived the deceased but had since died. The Court was not supplied with detailed evidence about the result of those searches.

[20]

Advices to the Plaintiff on the Issue of Domicile and UK Tax

Without definitively recording the making of a decision about the domicile issue or apparently seeking judicial advice between 1998 and 2014, the plaintiff obtained further legal and accounting/tax advice in relation to the deceased's domicile at date of death.
Between 8 April 1998 and 7 December 2000 Barclays acted on behalf of the plaintiff in relation to these matters. Barclays entered into correspondence with the UK Capital Tax Office which informed Barclays that it could deduct its fees from the UK assets if it were to act. But the UK Capital Tax Office would not confirm that it would accept the assets held in the UK as full and complete settlement of any inheritance tax liability.
On 8 December 2000 the plaintiff sought legal advice from Bartier Perry Solicitors Sydney. Bartier Perry advised that the limited information in their possession suggested that the deceased was domiciled in the UK at the date of her death and that the laws of the UK regarding a partial intestacy would apply to the distribution of her estate on a partial intestacy.
The information to that date suggested, according to Bartier Perry, that the UK Government was entitled to the funds in the Intestacy Account. The current position under the UK Inheritance Tax Act was said to be that the UK Capital Tax Office could claim inheritance tax on the Australian held assets but the situation as at the time of the deceased's death was not known. Bartier Perry considered that the UK Capital Tax Office would not seek to enforce their inheritance tax on the Australian assets by taking legal proceedings in Australia. They considered that as a practical matter the plaintiff should relinquish the UK assets to the UK Government in satisfaction of the tax liability.
On 30 March 2001 the plaintiff sought advice from Lester Aldridge Solicitors in England. Lester Aldridge advised the plaintiff that leaving aside the issue of whether the deceased was actually domiciled in the UK at the date of her death, she would almost certainly be deemed to be domiciled in the UK for capital transfer tax purposes, and that the Capital Tax Office could properly claim capital transfer tax on the deceased's worldwide assets. But on the basis that NSW applied the usual private international law principles in relation to the enforcement of the taxation liabilities of foreign states reflected in Government of India v Taylor, the UK revenue authorities would not be able to enforce the tax liability in Australia.
Assuming there was little change to the value of the assets in the UK and assuming the plaintiff had been successful in transferring the deceased's entire share portfolio into the plaintiff's name, the advice from Lester Aldridge was that the remaining UK assets should be abandoned.
Lester Aldridge advised, however, that there were factors which did not support the deceased having a UK domicile of choice: 1. The deceased returned to Australia every few years; 2. The deceased made her last will in NSW in 1968 and apparently she never made a will in the UK; 3. The deceased left most of her estate to Australian residents and an Australian charity; 4. The deceased had ample opportunity to alter her will between 1968 and 1979 but did not do so; 5. After making her Will the deceased continued to return frequently to NSW until she became incapable of doing so in 1979; 6. At least for the last 3 years of her life the deceased was clearly incapable of reaching any sensible decision as to where she should live.
On 3 March 2005 the plaintiff sought advice from KPMG Sydney relating to the deceased's domicile, the enforceability of UK inheritance tax on the Australian assets, the abandonment of the UK assets, which law would apply regarding the intestacy, and which government would be entitled to the funds in the Intestacy Account. KPMG also suggested some alternative approaches to the problem which may assist a resolution. These included conducting enquiries with the relevant NSW State Government authority and the UK Inland Revenue and Crown authorities on a "no name" basis, obtaining counsel's opinion in the UK and Australia, and/or simultaneously contacting the relevant UK and Australian authorities setting out the facts and requesting assistance of the parties to resolve the matter. It appears that the plaintiff decided not to proceed with the engagement of KPMG.
On 2 August 2007 the plaintiff communicated again with Lester Aldridge informing them that the plaintiff was prepared to declare that the deceased had UK domicile and instructing them to proceed with the obtaining of a grant in the UK. Lester Aldridge referred back to its advice given to the plaintiff in April 2001 that probate should not be resealed in England because of the deemed domicile of the deceased, and asked what had happened to counteract that advice. Lester Aldridge confirmed the earlier advice the firm had given: that there was sufficient evidence to suggest that the deceased had not abandoned her domicile of origin in NSW. On 8 August 2007 Lester Aldridge advised there were three principal options available to the plaintiff, but that of these options, the plaintiff should consider abandoning the UK assets.
On 21 January 2009 representatives of the plaintiff met with Bartier Perry. On 29 January 2009 Bartier Perry provided the plaintiff with a list of the issues that they then believed that the plaintiff needed to address. On 30 January 2009 the plaintiff confirmed instructions for Bartier Perry to advise on these issues.
On 26 June 2009 Bartier Perry confirmed that the firm was compiling the required information for advice and stated that the firm anticipated the need to brief counsel in Australia and the UK for advice on some of the matters raised. On 4 September 2009, Bartier Perry raised additional issues not previously considered to the plaintiff.
Further correspondence passed between the plaintiff and Bartier Perry and on 10 May 2010 Bartier Perry provided its detailed letter of advice. Bartier Perry provided a supplementary letter of advice to the plaintiff on 24 September 2010.
On 30 October 2013 the plaintiff requested further advice from Bartier Perry, based on further information obtained since the giving of the 10 May 2010 advice. On 9 May 2014 Bartier Perry provided updated advice taking the additional information the plaintiff had provided into account. On 2 June 2014 the plaintiff instructed Bartier Perry to instruct senior counsel. I infer that ultimately led to the application before me.
Between 2006 and 2014 the plaintiff carried out a number of searches, mainly to further investigate the issue of the deceased's domicile at the time of her death. These were the following: 1. In 2006 enquiries were made to the Australian Department of Foreign Affairs and Trade for documents that might show whether the deceased was the holder of an Australian passport at the date of her death and for any records relating to her movements between countries. Department's records and information databases did not disclose any such records. Its records only dated back to 1974, eight years before the deceased's death. By then the deceased was in her 80s and had probably reduced her travelling; 2. In 2009 the plaintiff obtained up-to-date details of the deceased's shareholdings held on the UK Register; 3. In 2013 an application was made in relation to the deceased by the plaintiff to search Supreme Court of NSW records relating to an application made under the Mental Health Act 1958 (NSW). That search located some documents relevant to the deceased's domicile at the time of her death. These are analysed further below.

[21]

Additional Facts Relevant to Domicile

When the deceased was in her early to mid-40s, and just before World War 2, she decided to place her financial affairs in the hands of the plaintiff. The Statement of Facts indicates that the plaintiff's files concerning the deceased (then held by Permanent) commence in 1938. Some parts of these files relevant to the issue of domicile have been extracted and included in the Statement of Facts. The deceased's decision to commit her affairs to the plaintiff's management was fortunate in the sense that at least there is some record of the financial and legal decisions that she was taking.
On 16 February 1938, the deceased, of 52 Macleay Street Pty Ltd, Greenknowe Ave, Potts Point NSW, appointed George Herbert Howell of Bowral NSW, as her attorney, or in the event of his death incapacity or inability to act, appointed Permanent, now Perpetual, the plaintiff, as her attorney. Mr Howell died on 11 July 1938. This power of attorney was prepared in NSW by Perkins, Stevenson & Co, Solicitors, Sydney and stamped in NSW, Queensland and Victoria.
The plaintiff's agency file summary sheet records that in a letter of instruction dated 29 July 1938, the plaintiff was appointed to act as the deceased's agent. The summary sheet sets out details of the agency account, including the payments to be made, fees and commission to be taken, bank details and banking instructions, the issuing of statements, the solicitors and brokers to be engaged, investment instructions, instructions regarding payment of insurance premiums on Queensland property, the storage and insurance of furniture in Sydney and Brisbane, and similar matters.
The plaintiff's records indicate that as at 10 April 1948 the deceased expected to be away from Australia for a year. She wanted the plaintiff to continue to act for her in her absence and to attend to her tax returns and pay tax when assessed.
On 27 April 1948 the deceased executed a new will in NSW appointing the plaintiff as executor from Australia of "52 Macleay Street" Greenknowe Ave Potts Point NSW. All beneficiaries named in the will are recorded in the will as living in Queensland or NSW. There was a desire expressed in the will that Messrs Thynne & Macartney Solicitors of Brisbane be employed by the trustee to act in connection with all matters relating to her estate in Queensland. The deceased requested that the plaintiff destroy her earlier will dated 11 March 1924.
On 29 April 1948 the plaintiff wrote to the deceased and to her solicitors, c/- Bank of New South Wales, 47 Berkeley Square London, England, acknowledging receipt of her new will and confirming destruction of the earlier will.
On 28 May 1948 the plaintiff paid Beard Watson & Co, a Sydney furniture manufacturer, retailer, carrier and storage provider, for collecting and packing the deceased's goods for storage in Australia, including the payment of insurance for 12 months to 28 April 1949.
The deceased used the plaintiff's services to provide for others in Australia. In July 1948 the deceased established a facility with the plaintiff for making monthly payments Australia of £12.8.0 per month to Miss Mary Latham. These payments continued until Miss Latham's death in 1953. The plaintiff's records also indicate that on 26 January 1950 the deceased paid for certain therapy and massage expenses for Miss Latham, and that she continued to pay for Miss Latham's medical and hospital expenses in Australia until Miss Latham's death.
Between mid-1948 and mid-1952 the plaintiff's files record detail that reflects much about her lifestyle in this period. She was by then 50 and during this period the expenditure indicates that she was leading an active life travelling, frequently in Europe, apparently based in the UK. But at the end of this period she returns to Australia. It is sufficient for present purposes for the Court simply to record the events during this period as they appear from the plaintiff's file. They are summarised in the Statement of Facts.
As at 15 July 1948 the deceased is recorded as intending to purchase a British car for shipment to Australia. In September 1948 the deceased is reported as having travelled to Switzerland, Italy and Austria. In October 1948 she travelled to Dublin, returning to the UK in November 1948. In November 1948 the deceased purchased a car in the UK. And the plaintiff's records indicate that the deceased was obliged to pay income tax in both in the UK and Australia during this period.
As at March 1949 the deceased planned to travel through England during the Northern hemisphere spring and summer months and planned to return to Australia in late 1949. As at June 1949 the deceased planned for her car to be sent to Australia in November 1949. But it appears that by October 1948 she had no plans to return to Australia just yet.
In November 1949 the deceased travelled to Paris. And she is recorded as intending to spend one or two months in the south of France or one or two months in the Channel Islands, from November 1949 to January 1950, as she apparently wished to escape England's winter. The plaintiff's records indicate that the deceased needed to pay income tax in the UK during this period. But she also had income tax payable in Australia for the financial year ending 30 June 1949.
Late 1949 to early 1950 represented a period of apparent indecision for the deceased about travelling back to Australia. At the end of November 1949 the deceased's UK motor vehicle was recorded as planned to be exported to Australia by the end of that month. But as at 19 January 1950 the deceased requested that her car be sold, as she had decided to remain in the UK for a further year.
The deceased holidayed from time to time outside the UK but returned to the UK to maintain her connection with her Australian friends. As at 22 April 1950 the deceased returned to London from Guernsey because her friends from Sydney were going to the UK for the summer.
From April to July 1950 the deceased returned to the issue of purchasing a motor vehicle, but this time apparently in preparation for a journey to Australia. In April 1950 the deceased indicated to the plaintiff that she was buying a new car in London and that she had sold her existing car on 4 May 1950. A sum of £700 was credited to one of the deceased's accounts with the plaintiff to facilitate the purchase of an Austin A40 car the deceased arranged. These funds were also to cover the payment of freight duty, sales tax, testing and other costs associated with the importation of the Austin A40 into Australia.
But the deceased seems to have purchased a different car to bring back to Australia. On 4 July 1950 while in the UK the deceased arranged for the purchase of a Vauxhall Wyvern Saloon for delivery in Australia.
The plaintiff's records indicate that on 29 July 1950 a 12 month premium was paid to 24 June 1951 for the storage of the deceased's personal property in Brisbane, Australia. This indicates that she still retained personal property in Queensland, despite having lived in Sydney for many years and having frequently travelled outside Australia, which property she wanted to have stored in Queensland rather than elsewhere.
The plaintiff's records indicate numerous capital payments being made from 21 January 1951 to the deceased at Berkley Square, London by cable, at the deceased's request.
The deceased returned to Australia at some time in 1952. The plaintiff's records indicate that on 3 April 1952 payment was authorised in the sum of £269.16.6 for the deceased's passage from the UK to Sydney on the ship, the RMS Strathnaver. Interestingly it is a matter of public record that this ship operated a regular liner route between Tilbury in Essex, England and Brisbane, Australia during its seagoing life, apart from the World War 2 period, when it was requisitioned for war operations. This suggests that in the 1950s the deceased was at times travelling directly from the UK to Brisbane, rather than to Sydney.
The plaintiff's ledgers for the deceased accounts show an entry on 22 November 1953 establishing a regular payment every 4 weeks of £16 to Miss Cecily Mooney, in Australia, at the request of the deceased. The four-weekly payments were subsequently increased. Together with additional ad hoc transfers of funds to Miss Mooney, these monthly payments, continued until the deceased's death.
The evidence from the plaintiff's records allows a reasonably confident inference that the deceased was in Australia between some time in late 1953 and some time in 1956. The deceased authorised various payments which are more likely to be explained by the deceased being present in Australia than being somewhere overseas. But the payments do not make clear whether she was wholly resident in New South Wales or whether she spent time in Queensland. On 9 December 1953 the deceased executed a new will in Australia. The will records her address as "52 Macleay Street", Greenknowe Avenue, Potts Point NSW and appoints the plaintiff as executor. All beneficiaries named in the will were stated as residing in Queensland or NSW.
The deceased's December 1953 will shows that she still held property in Queensland and that she had a preference for particular Queensland firms to provide professional services to her. For example, the will expressed a desire that Messrs Thynne & Macartney Solicitors of Brisbane be employed by the trustee in connection with all matters relating to her estate in Queensland.
On about 4 May 1954 the deceased made a donation of £0.5.0 to the Liberal Party of Australia. The plaintiff's records indicate that on about 24 May 1955 the deceased made a donation of £20 to The Sydney Morning Herald Public Appeals fund for flood relief. This was apparently in response to the massive floods that occurred in the Maitland and Hunter area that year.
The deceased supported a number of Australian friends and relatives. There is no evidence in the records of her supporting anyone in the UK in the same way. The deceased's mother's maiden name was O'Brien and that many of her Queensland relatives were O'Briens. It may be significant therefore that for about 6 years commencing in December 1956 she gave financial support to someone who it may reasonably be inferred was one of her relatives on her mother's side. The deceased authorised payments of differing amounts to Miss E O'Brien in Australia between December 1956 and October 1962.
The deceased travelled overseas again in 1960. The absence of any other records from this period, and the regular pattern of records created with the plaintiff when the deceased was actually travelling overseas, founds at least the slight inference that she was in Australia for much of the period between 1953 and 1960. But whether she spent her time in Australia in Queensland or in New South Wales or elsewhere is unclear. The Court has worked from the plaintiff's summary of the deceased's account with the plaintiff, which has been sufficient for the purposes of this judicial advice. But it may be that closer examination of those records later may throw more light on whether she spent much of her time in Australia in Queensland. In May 1960 the deceased travelled to Switzerland, and she left the UK for Australia and then returned to the UK on about 15 February 1961.
The plaintiff's records indicate that on 21 November 1960 dividend withholding tax was deducted from the deceased's agency account in Australia for the first time. Dividend withholding tax was deducted from the agency account thereafter until the deceased's death. Dividend withholding tax was introduced into Australian law in about 1960 and was payable by non-residents on their Australian dividends thereafter.
In or around 4 January 1961 the plaintiff investigated the issue of the deceased's domicile and how her domicile might affect the incidence of Victorian and Australian death duties on her estate. The plaintiff's records indicate that the representative wished to discuss this issue with the deceased before she revised her will. The deceased made two further wills, namely on 6 February 1961 and on 11 April 1964.
On 6 January 1961 the deceased travelled to South America. The plaintiff's records indicate that she undertook a number of international journeys in the 1960s. A number of these were between the UK and Australia. In November 1967 the deceased purchased boat passage from the UK to Australia and a return. It may have been during her stay in Australia after this journey that she made her 1968 will. On 24 September 1970 the plaintiff made a payment of $2,436.59 to P & O Lines of Australia Pty Ltd for the deceased's return fare sea passage to Australia. And the plaintiff's records indicate that in January and February 1971 the deceased withdrew funds from the Bank of NSW King & George Streets Sydney branch by cheque, evidencing that she was in Australia at that time.
By 1971-1972 the deceased was in her late 70s. Although she had travelled actively for much of the previous 30 years it could be expected that her travel would reduce somewhat in frequency at this age. There is very little evidence available from the plaintiff's records as to where the deceased was living and whether she was travelling between 1972 and 1978. But events in 1978 placed her in the UK.
On 17 November 1978 the deceased was admitted to the Hospital of St John & St Elizabeth, 60 Grove End Road, St Johns Wood, London where she remained until 7 June 1979. Dr Monica Hazel Greenwood, the deceased's consultant psychiatrist at the time, issued a medical certificate certifying that in her opinion the deceased was incapable by reason of mental disorder as defined in the Mental Health Act 1958, of managing and administering her property and affairs. The duration of the disorder at that time was said to have been 18 months.
On 1 August 1979 the Official Solicitor to the Supreme Court of Judicature (UK) was appointed Receiver for the deceased.
On 26 November 1980 the Supreme Court of New South Wales appointed the plaintiff without security as the committee to undertake the care and management under the order of the Court of the estate of the deceased in New South Wales.
The deceased died in Camden, England on 18 October 1982.

[22]

Consideration of Certain Matters Specifically Related to the Deceased's Domicile

As at 5 October 1959, the deceased planned to leave for Sydney on 14 February 1960. As at 4 January 1960 the deceased had to cancel her plans to come to Sydney as she could not book a journey back to the UK.
On 6 February 1961 the deceased executed a new will in Australia. This will was presumably made after the deceased received advice in relation to the issue of her domicile. This will records her address as "at present residing at 39 Hill Street Barclay Square London W.1 England" and appoints the plaintiff as the sole executor. All the beneficiaries named in this will were recorded as living in Queensland or NSW.
On 21 February 1964 the deceased executed a new will in Australia, her penulatimate will. The will records her address as "at present residing at 39 Hill Street London W.1 England" and appoints the plaintiff as the executor. All the beneficiaries named in the will were recorded as living in Queensland or NSW. The will included a payment to the Parish Priest in Innisfail Queensland for Masses to be said for the repose of the deceased's Soul. This legacy was to have priority over all other bequests in the 1964 will.
On 1 April 1968 the deceased executed a new will in Australia. The will records her address as "at present residing at 39 Hill Street London W.1 England" and appoints the plaintiff as executor. The majority of beneficiaries were stated as being in Queensland or NSW, and two legatees in the UK. The will included a payment to the Parish Priest in Innisfail Queensland for Masses to be said for the repose of the deceased's Soul. This legacy again was stated to have priority over all other bequests.
A protective order was made in England in relation to the deceased in August 1979. The Official Solicitor then corresponded with Permanent in Sydney about the administration of the deceased's property. One of these letters is of particular present interest. The Official Solicitor to the Supreme Court wrote on 5 March 1980 to Mr T.G. Harland Esquire, an agency officer of Permanent concerning the deceased. The author of the letter for the Official Solicitor was one R.S. Dhondy. The letter assumes a number of prior communications between Permanent and the Official Solicitor, not all of which have been clearly identified. The general intent of this letter was that the Official Solicitor was seeking to persuade Permanent that it should make an application in New South Wales under the Mental Health Act 1958 (NSW) for an order for the management of the deceased affairs because the Official Solicitor believed on the evidence available that she was domiciled in New South Wales. His arguments to Permanent was successful and shortly afterwards an application was made.
In the course of writing the 5 March 1980 letter to Permanent the Official Solicitor agreed with the officers of Permanent that the deceased was currently domiciled in Australia. The paragraph that deals with this issue is set out here in full: "According to my information, Miss Dempsey is a citizen of the Commonwealth of Australia having been born in Australia of Australian parents on 20th September 1895. Her domicil (sic) of origin accordingly would have been in Australia. I understand that she came over to the United Kingdom approximately 30 years ago, and that she has continuously resided in this country since them (sic), though I do not know the exact date of her arrival in the United Kingdom or the purposes of her visit to this country or what she has been precisely doing while residing in this country. There does not appear to be any record of her having been employed in this country or of her having purchased any immovable property in this country, Prior to her admission to hospital on the breakdown in her mental condition, she appears to have been residing in rented accommodation at 39 Hill Street, London, W.L. You will appreciate that the foregoing matters have a necessary bearing on her current domicil (sic). As I view the position, under the rules of private International law applied by Courts both in this country and in Australia, she would be currently deemed to be domiciled in Australia having retained her Australian domicil (sic) of origin unless it can be established that she had acquired a domicil (sic) of choice in this country. For that purpose her residence in this country would have to answer both a qualitative as well as a quantitative test and the duration of her residence in this country would not suffice unless it can be shown that it was with the intention of remaining permanently in this country. Had that intention been present, even if her residence in this country had been brief, it would not have been an obstacle to the acquisition by her of a domicil (sic) of choice over here. It would seem from your letter that Miss Dempsey has repeatedly advised you that she has no intention of relinquishing her Australian domicil (sic) of origin, and this I think would negative any intention on her part to remain permanently in this country. She would of course be incompetent under both systems of law to acquire a domicile of choice in this country after the commencement of her incapacity, as it is generally accepted that the domicile of a person of unsound mind cannot be changed by that person since he or she is incapable of forming the necessary intention. In the foregoing circumstances and in the light of the information currently available to me, I am inclined to agree (sic) your viewpoint that Miss Dempsey is currently domiciled in Australia having retained her Australian domicil (sic) of origin. If so, manifestly even on a basis of reciprocity and the decision in Didisheim's case, your Company could not competently recognise the authority conferred by the Court of Protection on the Official Solicitor to receive and (give a discharge for any moneys held by your Company on behalf of Miss Dempsey".
The Official Solicitor of the Supreme Court (UK) said that he also requested a copy of the deceased's will dated 1 April 1968. For this subject to arise in correspondence the deceased must not only have been very unwell at this time but it must have been accepted that she would be permanently incapable of further travel. The Official Solicitor stated in this correspondence that as far as her UK estate is concerned it would be necessary upon the deceased's death for the plaintiff to obtain an attorney grant of administration with will annexed to facilitate dealing with her estate.
On 20 November 1980 the plaintiff filed a Summons in the Supreme Court of NSW Protective Division No S.38 of 1980 claiming an order that the Permanent Trustee Company Limited or some other fit and proper person may be appointed, with or without security as the Court may determine, as committee to undertake under the order and direction of the Court, the care and management of the deceased's estate in New South Wales. The Court made the order on 26 November 1980.
An affidavit sworn by Thomas Geoffrey Dobbie, General Manager - Personal Trusts, Permanent Trustee Company Limited on 14 November 1980 was filed in support of the Summons. Attached to the affidavit were copies of correspondence dealing with the issue of the deceased's domicile.
As might be expected, in the first two years after the deceased's death a number of entries in the plaintiff's files deal with the issue of the deceased's domicile. The plaintiff's records for this period include an internal memorandum dated 21 October 1982, from its Taxation Division to the trust officer managing the deceased's account. The memorandum states that no Australian returns of income were lodged for years because dividend and interest withholding tax applied, that the trust officer could ascertain a file number by searching his records back to 1938, that the UK income and capital gains tax returns for the plaintiff were lodged by Wilfred T Fry Ltd 31 Queen Street Exeter Devon EX4 3SR.
At the foot of this internal memorandum in the handwriting of the plaintiff's officers, both signed and counter-signed, appears the following note: "NB Miss Dempsey had NSW domicile but had resided in the United Kingdom since to (sic) late 1940s although she made frequent visits to NSW which she regarded as her place of domicile but (sic) because she intended to return to live here permanently". The note is of considerable present interest. It is written in a style as though the author or authors were personally familiar with the deceased or had been dealing with her affairs for a long time or both. At the Court's request further inquiries were made about the officers of Permanent who were responsible for this note.
An affidavit of Ashley William Lowden Isaacs sworn 27 November 2015, which the Court gave leave to file after the hearing, explained some relevant background. Mr Isaacs incidentally confirms that Permanent did not have an office in Queensland between 1938 and 1980.
Mr Lowden was employed with Permanent for 35 years and was well acquainted with the author and signatory of this note. The author of the note Ms Pina Pascuzzo was a trust officer at Permanent. The note is initialled by Mr Brian Watt, her superior. Mr Isaacs had worked with Permanent for over 35 years prior to his retirement and he was able to say that Mr Brian Watt had worked at Permanent for over 40 years. The usual practice of Permanent at that time was for officers to ensure that the correct and relevant information was provided by officers working in Permanent's agency division to Permanent's taxation division.
Mr Isaacs expected that in accordance with Permanent's usual practice, the memorandum concerned was a pro form document which was completed by Permanent's trust officer and sent to Permanent's taxation division to ensure that a file was opened to deal with any taxation matters arising in the administration of the deceased's estate. Mr Isaacs expects that Mr Watt and Ms Pascuzzo probably collaborated on the making of this note. Mr Isaacs remembered Mr Watt was a competent and meticulous trust officer who insisted on accuracy in all notes in Permanent's files. Mr Isaacs also judged Ms Pascuzzo's work with Permanent to be of very high standard.
It was normal practice at the time for Permanent to have the affairs of clients with funds invested with Permanent, managed by the same trust officer during their lifetime and, if possible, their estates were managed by the same person after the client's death. Such lengthy personal contact gave the trust officer a good working knowledge and understanding of the client's affairs. Mr Isaacs was able to say that Mr Watt actually had a good detailed knowledge of the deceased's affairs and had contact with the deceased during her time as an agency client at Permanent.
From all of this it can be inferred that what is recorded in this note is the product of Mr Watt's, and possibly Ms Pascuzzo's, recollection of personal contact with the deceased.
The plaintiff's records for this period include a letter dated 22 October 1982 from the Official Solicitor to the Supreme Court (England) addressed to the plaintiff, noting that their duties as Receiver had ceased on the deceased's death, informing the plaintiff that so far as the Official Solicitor was aware the deceased left no surviving kin and informing the plaintiff of the deceased's funeral arrangements in the UK. The deceased was buried in the UK.
The plaintiff's records include a letter dated 28 October 1982 from the plaintiff to the Official Solicitor UK, which refers to an application for a grant of probate of the will being made in New South Wales. The plaintiff obtained a grant of probate of the deceased's Will in New South Wales.
The Official Solicitor UK wrote to the plaintiff on 17 November 1982 enclosing details of assets and liabilities of the deceased in the UK and noting necessity to obtain an Attorney Grant in the UK to collect the assets of the deceased's UK estate.
The plaintiff instructed Norton Smith & Co on 15 April 1983 to prepare probate documents and a death duty return for the deceased's Victorian assets. The plaintiff's records indicate that the declaration lodged with the death duty return recorded the deceased's place of residence as in the UK, and the deceased's State or Country of domicile as Australia.
The plaintiff instructed Norton Smith & Co on 24 May 1983 to act for it to apply for an exemplification of the probate, as it would be necessary for probate to be resealed in England.
The plaintiff instructed Lloyds Bank London on 21 June 1983 to act as Attorney for the plaintiff in obtaining a reseal of the NSW probate in the UK. The plaintiff's letter of instructions to Lloyd's Bank states that the plaintiff had acted for the deceased for over 40 years and had control of her Australian assets during this period, that the deceased was born in Queensland, and although she resided in the UK, the deceased retained her domicile of origin.
On 29 June 1983 Lloyds Bank UK requested that the plaintiff clarify the deceased's domicile, because of its effect not only on the liability to capital transfer tax, but also on the administration of the estate. Lloyds Bank's June 1983 letter further states that although the deceased may have retained a domicile of origin under general law, UK authorities may contend she has a deemed domicile in the UK for UK fiscal purposes.
On 15 August 1983 the plaintiff advised Lloyds Bank that it was looking into the question of the deceased's domicile. The plaintiff pursued the issue and did so fairly quickly by making enquiries of Coopers & Lybrand, Chartered Accountants.
On 19 August 1983 the plaintiff wrote to Coopers & Lybrand, informing them that probate of the deceased's will had been granted to the plaintiff by the Supreme Court of NSW on the basis that the deceased was domiciled in NSW. The plaintiff advised Coopers & Lybrand that the deceased was born in Queensland which would appear to the plaintiff to be the deceased's domicile of origin, but that she moved to NSW prior to World War II and that the plaintiff had acted as her attorney since 1938. The plaintiff further advised that most of the deceased's investments were in shares in public companies with registries in New South Wales, although she did not hold any real property in this State. The plaintiff further told Coopers & Lybrand that the deceased regarded NSW as her permanent home and consequently acquired a domicile of choice in NSW. The plaintiff explained that after World War II, the deceased made several visits to the UK and in the 1950s took up residence at 39 Hill St London, visiting Australia every few years as well as travelling to the continent and to South Africa.
Coopers & Lybrand advised the plaintiff by letter dated 5 October 1983 that: 1. If the deceased was domiciled or deemed domiciled in the UK, capital transfer tax would be payable on the deceased's world-wide assets; 2. On the information available, it could be strongly argued that the deceased acquired a domicile of choice in the UK, and that it was extremely likely the UK Revenue authorities would take the same view. This is of academic interest only, as the deceased is deemed to be domiciled in UK pursuant to section 45 Finance Act 1975. Coopers & Lybrand estimated the tax liability for which the estate was liable at in excess of £175,000 pounds; 3. There was no UK capital gains tax triggered by the deceased's death. The executor acquires assets at market value; 4. However, there is no UK executor, and there therefore appears to be no effective machinery for the UK Revenue authorities to recover the capital transfer tax liability from non-UK assets.
On 12 October 1983 the plaintiff decided to abandon the deceased's UK assets as the value of the UK assets was then approximately AUD$38,500 and the UK Capital Transfer Tax payable was in excess of £175,000.

[25]

General principles of domicile and the Domicile Acts

The legal framework for assessing domicile was made uniform in Australia shortly before the deceased's death. Identical domicile legislation was passed in each of the Commonwealth, New South Wales and the Queensland Parliaments and all came into effect on 1 July 1982 and so applies to the deceased: Domicile Act 1982 (Cth), Domicile Act 1979 (NSW), Domicile Act 1981 (Qld). It is convenient to use the identical section numbering of the New South Wales and Queensland legislation in these reasons without distinguishing between the two jurisdictions.
The statutory rules enacted in this legislation apply whenever domicile has to be determined after 1 July 1982 on the basis that the legislation has always been in force: s 4(2). The legislation refers to a "country" but this relevantly includes States or provinces: s 3. And a "union" within the legislation means any country "that is a union or federation or other aggregation of two or more countries and includes the Commonwealth of Australia". A person who is in accordance with the rules of common law relating to domicile, as modified by the legislation, is domiciled in a union but is not, apart from s 10, domiciled in any particular one of the countries that together form the union, is domiciled in one of those countries in which he or she has for the time being the closest connection: s 10.
The law of domicile of origin may be shortly stated. The domicile of origin is that domicile is ascribed to each individual at birth by force of law: M Davies, AS Bell and PLG Brereton, Nygh's Conflict of Laws in Australia (9th ed 2014, LexisNexis Butterworths Australia) ("Nygh"). At common law a nuptial child takes the domicile of its father at birth: Nygh at [13.13].
The law in relation to domicile of choice may be shortly stated. At common law it could be difficult to prove that a person had the requisite intention to acquire a domicile of choice; it being presumed that a person exchanged a domicile of origin for a domicile of choice with the greatest of reluctance. The onus of proving the abandonment of domicile of origin and the acquisition of a domicile of choice is upon the party asserting the change and the standard of proof is on the balance of probabilities: Nygh at [13.23]. But the statutory position is that the acquisition of a domicile of choice in place of a domicile of origin may be established by evidence that would be sufficient to establish the domicile of choice if the previous domicile had been a domicile of choice: Domicile Act, s 11. Thus the onus of proof to establish the departure from a domicile of origin is now no heavier than it would be to establish the change from one domicile to another.
The statutory intention a person must have to acquire a domicile of choice in a country is "the intention to make his or her home indefinitely in that country": Domicile Act, s 9. And the rule of law whereby the domicile of origin revives upon the abandonment of a domicile of choice, without the acquisition of a new domicile of choice is now abolished: Domicile Act, s 6. But the statutory test for acquiring a domicile choice in a country is the same as the test at common law, namely that the person acquires a domicile of choice in a country by being lawfully present there with the intention of remaining in that country indefinitely: Nygh at [13.19] - [13.20].
Two elements must be satisfied to acquire a domicile of choice: physical presence and intention. Provided the intention can be proved to exist, the length of presence in the jurisdiction is immaterial: Nygh at [13.19].
The necessary mental element to obtain a domicile of choice has sometimes been described as "an intention to reside permanently or indefinitely in a country": Nygh at [13.19]. The term "permanent" in the formula is nothing more than a way of indicating that the person's intention is one which when formed is one to remain a resident of the country for a period then regarded by him or her as unlimited in time and without having addressed himself or herself to the question of giving up such residence and leaving the country of his or her choice upon the happening of some particular and definite event in the foreseeable future, notwithstanding that he or she may entertain a "floating" intention to return at some future period of time to his or her native country: Hyland v Hyland (1971) 18 FLR 461 per Asprey JA. The distinction is sometimes seen as one between a definite intent to return or move on and a "floating intention", but the question must be considered objectively: Nygh at [13.19]. An objective assessment means that it is not so much the hopes and expectations of the person concerned that is at issue but the probability in his or her assessment of the contingencies he or she has in contemplation being transformed into actualities: Nygh at [13.19]. The correct construction of the statutory test under Domicile Act, s 9 is that it may only clarify and does not change the common law test: In the Marriage of Henry (1995) 19 Fam LR 227, reversed by the High Court on other grounds - Henry v Henry (1996) 185 CLR 571, and see Nygh at [13.20].
At common law a domicile of choice was abandoned when a person left the territory of the existing domicile with the intention of never returning or, having left that territory at first for a limited duration, subsequently formed the intention not to return: Nygh at [13.21]. However in order to abandon an existing domicile it is not necessary to severe all links with the country of the former domicile. Thus a party will acquire a new domicile when he or she establishes that his or her principal residence is in another country, even though he or she retains a residence in the country of former domicile for business, study or other purposes: Plummer v Inland Revenue Commissioners (1988) 1 All ER 97 at 106. For example a Fijian domiciliary has been held to have acquired an Australian domicile of choice while retaining a home in Fiji: Ferrier Watson v McElrath (2000) 26 Fam LR 169.
A person's presence in a particular place raises the presumption of domicile there: Re McKenzie (1951) 51 SR (NSW) 293 at 298, per Sugarman J. But this statement may be no more than an indication that in the absence of any other evidence such presence constitutes sufficient evidence from which the existence of a domicile at that place can be inferred and if other evidence is available the fact of presence is merely one of many factors to be considered: Nygh at [13.26]. Intention in the main should be deduced from behaviour rather than a person's own declaration, but "honest evidence of actual intention cannot be cast aside and treated as non-existent and some sound reason must be found for disbelieving it": Fremlin v Fremlin (1913) 16 CLR 212 at 234 and see Nygh at [13.26].
The importance of any one fact is relative and the ultimate question is always - what is the proper conclusion to be drawn from all the circumstances: Re Cartier (1952) SASR 280 at 291 and se Nygh at [13.26].

[26]

Domicile - Analysis

In this section the Court concludes that the trustee would be justified in distributing the deceased's assets on the basis that she held Australian domicile and was not domiciled in the United Kingdom. Whilst it is more probable that the deceased was domiciled in New South Wales the possibility of her still retaining her domicile of origin in Queensland cannot readily be excluded, given the uncertainties surrounding aspects of the deceased's life in Australia. Therefore, before the Court could advise the trustee that it is justified in distributing the intestate share of the deceased's estate on the basis that her domicile was New South Wales, further steps should be taken to ascertain whether executors of the deceased's cousins in Queensland wish to maintain a case and advance supporting evidence for the conclusion that the deceased retained her domicile of origin in Queensland.
The plaintiff should prepare a plan of action to see if any executors of the four paternal cousins who survived the deceased (or through them the descendants a beneficiaries of those cousins) can be identified and whether they wish to maintain a case that the deceased retained her Queensland domicile of origin. It may be that if persons who wish to maintain such a case are identified that an appropriate representative of the New South Wales government should then be contacted so that it is given an opportunity to maintain the contrary position that the deceased's domicile of choice was New South Wales.
The deceased's domicile of origin was Queensland. The deceased's father appears to have lived for 50 years in Queensland and to have been domiciled in Queensland. His death certificate in 1916 does not indicate he resided for any time outside Queensland.
Whether this domicile of origin was affected in any way by the deceased's life before her early 40s is difficult to say. The deceased's mother died in 1923 and she made a will with Permanent shortly afterwards in 1924, but a copy of this will is not available. Whether and how long she lived in Queensland before 1938 is unclear. But she did have real estate in Cairns which was later sold. She may have lived in that property. There is nothing in my view in the materials before the Court to suggest that she had lost her domicile of origin of Queensland before 1938.
Whether she acquired a domicile of choice outside Queensland after the late 1930s is a question that can be analysed into two sub-questions: (1) whether she acquired a domicile of choice in New South Wales; and (2) whether she acquired a domicile of choice in the United Kingdom. It is convenient first to deal with the Australia - United Kingdom domicile question. Then the Court addresses the questions that arise within the deceased's Australian domicile.
It is improbable that the deceased acquired UK domicile. Although she had rented premises in London between 1950 and in the late 1970s when she was taken into care before her death, both her expressed intentions and her actions indicated that she wished to maintain her Australian domicile. Both declarations and actions need to be examined.
Although not decisive on its own, her declaration to Permanent's trust officers that is recorded in Mr Watt's and Ms Pascuzzo's note in 1980 is an important statement of hers that despite her residence in London she had a definite intention to return to Australia, to live here permanently, rather than what might be described as a floating intention. The deceased's statement to the Permanent trust officer explains much of her actions, particularly in the 1960s and up until the mid 1970s. For the reasons given earlier, because of the deceased's probable growing incapacity by the mid 1970s it is difficult to make any judgments about her actions beyond then as she may by then have lost her capacity to choose to move back to Australia and/or the capacity to act on that choice.
But the 25 years between 1950 and the mid 1970s shows interesting patterns that are consistent with a woman who never intended to make the UK her home indefinitely and retained her Australian domicile.
Her testamentary acts are important. She made all her wills during this period in Australia with Permanent. Her testamentary intentions were mostly for the benefit of Australian family and friends or Australian charitable institutions, with one or two notable exceptions. She appears to have had a connection with a Jesuit Church in Farm Street, London, which may well have been where she worshipped. But only one other UK individual, a friend, Mrs Eve Carol who also lived at 39 Hill Street, London, is mentioned.
The deceased made regular trips to Australia. These could not be characterised as short-term holidays away from her place of permanent residence. They were for lengthy periods. They involved her transacting investment business with Permanent and other financial institutions and dealing with her property in Australia. When she was here she: made charitable donations to Australian causes. For much of the 1950s and early 1960s her trips included returning to an address in Sydney. And it may be inferred from the deceased's various testamentary instruments that the trips included a chance to enjoy the companionship of a circle of family and friends in Sydney and in Brisbane. And in the early years her trips involved importing goods, including motor vehicles, into Australia for her use here.
The deceased never purchased real estate in the United Kingdom. Although it may be said in contrast that it is not clear that she owned the Potts Point property in Sydney and it may only have been rented. That comparison does not indicate a preference for the United Kingdom. There is no record of her working in the United Kingdom. But she turned 60 in 1954. So the chances of her being employed there were fairly remote in any event.
Even her acquisition of movable property shows a strong preference for Australia. Almost the whole of the value of the shares that she acquired on the English Register were Australian banking shares, in the Australia and New Zealand Banking Group Limited and Westpac Banking Corporation. The combined value of those shares was ten times her holdings of shares in a limited number of British companies, British Petroleum Co Limited, Laird Group Limited and British American Tobacco Co Limited.
An impression one has about the deceased's life choices about where she lived, is that she had inherited enough wealth to be in the fortunate position to be able to travel. And in an era where travel by sea was the norm rather than travel by air, having a base in London was a convenient place for her to indulge this interest, in the United Kingdom and on the continent.
But there is still great uncertainty about how the deceased spent her time in Australia and in particular how she allocated it between Queensland and New South Wales. The deceased's statements to officers at Permanent prior to her affairs being placed under management may confidently be interpreted as expressing a preference for Australian over UK domicile. But the statements should be approached cautiously as possible expressions of a preference for New South Wales over Queensland domicile.
There are several reasons for this. First, it is clear that the deceased did not spend significant parts of her time in Australia in Queensland, between 1950 and the mid 1970s. The fact that she was dealing with Permanent in Sydney and had bank accounts in Sydney is some indication of her financial and residential ties in this State. But that may in part be because her Queensland options were limited. Permanent did not have an office in Queensland before 1980.
For the same reason the fact that 6 wills in the plaintiff's possession in 1938, 1948, 1953, 1961, 1964 and 1968 were all made in Sydney rather than in Brisbane may be partly explained by the fact that the plaintiff did not have a Brisbane office before 1980.
Secondly, it is not clear that the deceased ever purchased real estate in Sydney. But she did own property in Lake Street, Cairns until about the 1950s. Whether she lived there or used it as an investment property is unclear.
Thirdly, the deceased benefitted a number of Queensland residents in her will. She appeared to have maintained a strong personal connection with the church in Innisfail in which she probably worshipped as a child. She made a request for prayers to be said for the repose of her soul in that church and not in any church in New South Wales. The largest bequests under her will went to two relatives of her mother's Queensland family, although one of them lived in New South Wales, in Milsons Point.
The deceased appears to have arranged her travels from London so she could travel directly between Brisbane and London on the RMS Strathnaver. This at least raises the possibility that substantial parts of her time were spent in Queensland.
For these reasons the Court is not presently satisfied that the plaintiff would be justified in distributing the intestate share of the deceased's estate on the basis that she was domiciled at her death in New South Wales, rather than in Queensland. The Court expects that the plaintiff will now take the course of attempting to contact persons in Queensland who have an interest in arguing that the deceased had a Queensland domicile to see if some of the uncertainties identified in these reasons can be eliminated. Removal of these uncertainties will either confirm her New South Wales domicile or add detail to the contention that she did not lose her domicile of origin in the State of Queensland.

[27]

Question (c) - the Overpayment to University

There is no doubt that the plaintiff paid the University $25,363.64 on or about 19 April, 1993. But only indirect evidence supports the plaintiff's claim that this was a mistaken payment. It consists of an exchange of correspondence with the University in May-June 1994, now almost 22 years ago. The relevant correspondence is not lengthy and is set out in full below.
The plaintiff informed the University of the alleged overpayment of $25,363.64 by letter dated 30 May 1994. As was indicated earlier in these reasons the plaintiff contends that the payment was a part share of a tax refund to the estate to which the University was not entitled, because it was a tax exempt institution. To rectify the matter the plaintiff suggested at the time that this amount be deducted from the future income to which the University was entitled. Alternatively the plaintiff suggested that the University could repay the amount to the plaintiff directly. The plaintiff's letter provided as follows: "30 May, 1994 The Bursar University of Sydney DX 1154 SYDNEY Attention: Mr Roger Sebel Dear Sir, Re: Estate Late Evelyn Mary Dempsey We refer to previous correspondence in the above matter and wish to draw your attention to an error in the administration in the above estate. On the 19th April 1993 you received a cheque for $25,795.87 the amount of which being extraordinarily high for a distribution and which you queried at the time. Upon reviewing our records it is noted that this extraordinary amount was a half share of the income in the residue account at that time. This income was derived from a refund of taxation due to a separate partial intestacy account under the estate. As you are a charity your account is exempt from taxation liability and therefore not entitled to any such refund. Due to an error in our accounting a half share of this refund an amount of $25,363.64 was paid to you wrongly. To rectify matters we propose two courses of action, firstly that we deduct from your account the amount of $25,363.64 from the income to which you are entitled then make no further payment to you until this balance is repaid through a natural accrual. Alternatively that you would be able to repay that amount to us directly so our accounts may be rectified and continual payments may be made. We would be pleased if you would consider the options and advise us which approach you believe preferable. In evidence of the above we enclose herewith a copy of a statement for the period 1st January 1993 to 30th December 1993 for your records. We hope that you will not be overly inconvenienced by our error for which we apologise. Yours faithfully, PERMANENT TRUSTEE COMPANY LIMITED"
The University wrote back to the plaintiff on 2 June 1994 requesting documentary evidence relating to the overpayment. Investigations undertaken so far have not revealed any subsequent correspondence on the plaintiff's file relating to the overpayment. The University's reply was as follows: "2 June 1994 Permanent Trustee Company Limited 23-25 O'Connell Street SYDNEY NSW 2000 Dear Mr Kelly, Estate late Evelyn Mary Dempsey If the University has received a distribution from the above estate, to which it was not properly entitled, then arrangements can be made to remedy the situation. A careful reading of your letter and our file however, does not provide sufficient documentary evidence that the University has indeed received an inappropriate distribution. Although, as you point out the matter was first raised by us more than a year ago. Would you kindly arrange for the preparation of a statutory declaration to be signed by a senior officer and setting out the full background and circumstances."
The plaintiff did not reply. The University did not repay the amount. Instead the plaintiff has since recouped the sum to the estate, by accumulating and retaining within the Residue Account the income which would otherwise have been distributed to the University. The plaintiff submits that its mistaken payment was an innocent breach of trust, which can now easily be remedied by transferring to the Intestacy Account the amount of $25,363.64 together with appropriately calculated interest. This would have the effect of permanently reducing the University's potential share of accumulated income currently held in the Residue Account.
I accept that the plaintiff has attempted to put before the Court all its presently available evidence on this issue, namely this exchange of correspondence. I infer from what Mr Meek SC put in submissions, the Statement of Facts and this correspondence (Exhibit F) that after reasonable search and enquiry the plaintiff cannot find anything else within its files to throw additional light on this issue. Indeed, even the account statement for the period 1 July 1993 to 30 December 1993, which is referred to in the plaintiff's 30 May 1994 letter, has not been tendered and after the passage of 22 years does not appear to be available. But it was probably only a statement that recorded in the plaintiff's accounts the distribution of the sum of $25,795.87 on 19 April 1993.
The thoroughness with which Mr Meek SC, and Mr Gerard Basha (who now has carriage of this matter on behalf of the plaintiff's solicitors, Bartier Perry) have respectively approached the advising and the investigations for relevant material, has been self evident in the way these proceedings have been presented to the Court. Their approach to the matter gives the Court confidence that it is unlikely that much more material can be found on this issue.
The Court has well established jurisdiction to excuse a trustee for innocent breaches of trust: Trustee Act, 1925, s 85 and see JD Heydon, MJ Leeming, Jacob's Law of Trusts (7th ed 2006, LexisNexis Butterworths), at [2214] - [2224]. It is necessary for the trustee to show that the trustee has acted honestly, reasonably and ought fairly to be excused for the breach of trust and for omitting to obtain the direction of the Court in the matter. It should be noted that a professional trustee such as this plaintiff has a particularly heavy task to make out a title to relief under the section: Elders Trustee and Executor Co Ltd v Higgins (1963) 113 CLR 426 at 452.
Accepting the available evidence at face value, the mistake that the plaintiff appears to have made in May 1994 was probably a mistake of law in treating the University as entitled to a half share of a tax refund received by the deceased's estate, when as a charity the University was exempt from taxation liability and therefore probably not entitled to the refund. Errors of law such as this give the paying party rights of restitution for the mistaken payment: David Securities Pty Ltd v Commonwealth Bank of Australia (1992) 175 CLR 353 at 353. Trustees may be entitled to relief under Trustee Act, s 85, even for mistakes of law: Holland v Administrator of German Property [1937] 1 All ER 807 and Re Allsop (1914) 1 Ch 1. Although it must be said that the circumstances in which the error took place here appear to have been more in the nature of an administrative error where a payment was authorised (probably by a junior clerical officer) without any properly focussed consideration upon the issue of the persons who were actually entitled to the funds.
But the plaintiff trustee has never replied to the University's correspondence. As a beneficiary of the estate, the University's enquiry was entirely justifiable. It wanted to understand why the plaintiff was contending that it had received a mistaken payment of $25,363.64. In my view it is not satisfactory for a trustee to continue to fail to reply to such correspondence to a beneficiary for such a lengthy period and then come to the Court and seek in substance to be excused from its breach of trust by the Court advising the plaintiff that it may make an accounting entry which will, without more, rid itself of the issue. In my view the University still deserves an answer to its 2 June 1994 letter.
Presumably after the plaintiff undertakes any necessary further searches the plaintiff's answer will convey to the University, if indeed it continues to be the case, that there is no other material available than this correspondence that would demonstrate that the plaintiff's April 1993 payment was mistaken. That letter may also need to explain to the University the precise legal basis upon which the plaintiff contends that the payment was indeed a mistake and why the University was not entitled to the money. And finally that letter would probably be accompanied by a copy of this judgment.
The University asked in its June 1994 letter for a statutory declaration signed by a senior officer, setting out the full background and circumstances. In my view as a beneficiary of the estate the University is entitled to just that. Both the University and the Court should be provided with an affidavit by a senior officer of the plaintiff, explaining what can be found from the plaintiff's records after reasonable search and enquiry, and, based on what can be found, what the plaintiff infers occurred in 1993.
It may well be after this affidavit is provided that the University accepts that there was a mistaken overpayment. On the materials that the plaintiff has provided so far the Court is certainly inclined to draw that conclusion and to excuse the plaintiff from its innocent breach of trust and give judicial advice to the effect requested. But the Court is disinclined to take that course until the steps set out here have been taken.

[28]

Question (d) - the United Kingdom Tax Liabilities

The plaintiff asks whether it would be justified in distributing the Australian estate of the deceased to the estate beneficiaries without regard to any or all of the UK taxation liabilities that may be payable by the estate.
In October 1983, following the advice received from Coopers & Lybrand, the plaintiff's files record that it decided to abandon the estate's UK assets, as their value was far exceeded by the estate's estimated liability for UK capital transfer tax. Coopers & Lybrand's advice at the time in summary was: (1) if the deceased was either domiciled or deemed domiciled in the UK, capital transfer tax would be payable on the deceased's world-wide assets; (2) although it could be strongly argued that the deceased acquired a domicile of choice in the UK, the deceased's domicile was only of academic interest because under the Finance Act 1975 (UK), s 45 as a resident of the United Kingdom in the relevant tax years the deceased was deemed to be domiciled in the United Kingdom for tax purposes; (3) no UK capital gains tax would be triggered by the deceased's death but that capital transfer tax would be payable on the deceased's worldwide assets because of her deemed domicile for tax purposes; (4) but because there was no UK executor of her estate there was no effective machinery for the UK Revenue authorities to recover the capital transfer tax liability from non UK assets.
The plaintiff therefore apparently took what in October 1983 appeared to be the only reasonable course: it decided to abandon the UK assets with a then estimated value of AUD$38,500, in the face of a UK capital transfer tax liability on the deceased's worldwide assets in excess of £175,000 pounds.
But despite this decision being made on paper, the plaintiff does not appear to have put it into effect. The reasons for this are not entirely clear. The elements of the reasoning that Coopers & Lybrand identified for the plaintiff in 1983 are still the central considerations on this issue. These elements are dealt with below.
On the issue of domicile, the Court's answer to question (a) confirms that the plaintiff would be justified in distributing the intestate share of the deceased's estate on the basis that her domicile at the date of death was in Australia, rather than the United Kingdom. The only domicile issue which the Court has left open is whether the deceased lost her domicile of origin in Queensland and acquired a New South Wales domicile. The Court has indicated further steps should be taken to investigate that issue.
But the Coopers & Lybrand 1983 advice to the plaintiff was that the deceased's deemed domicile under Finance Act 1975 (UK), s 45 for tax purposes, rather than her actual domicile, was the decisive consideration.
If the Coopers & Lybrand advice is accepted that the Finance Act 1975 (UK), s 45 deemed the plaintiff to be domiciled in the UK for tax purposes, then it is difficult to criticise the conclusion of the Cooper & Lybrand advice that retention of the estate's UK assets was uneconomic.
But the precise factual assumptions upon which the Coopers & Lybrand advice was founded are not clear to the Court, and in particular the basis on which Coopers & Lybrand concluded that Finance Act (UK), s 45 applied to deem the deceased domiciled in the UK for tax purposes. This is of some importance because it may be that the Finance Act 1975 (UK), s 45 did not apply to deem the deceased domiciled in the UK for tax purposes if she was not otherwise domiciled there.
The Finance Act 1975 (UK), s 45, so far as the Court's own examination of the legislation goes, was enacted as follows: "45. (1) Except as otherwise provided, a person not domiciled in the United Kingdom at any time (in this section referred to as " the relevant time") shall be treated for the purposes of this Part of this Act as domiciled in the United Kingdom at the relevant time if- (a) he was domiciled in the United Kingdom on or after 10th December 1974 and within the three years immediately preceding the relevant time ; or (b) he was resident in the United Kingdom on or after 10th December 1974 and in not less than seventeen of the twenty years of assessment ending with the year of assessment in which the relevant time falls ; or (c) he has, since 10th December 1974, become and has PART 111 remained domiciled in the Islands and, immediately before becoming domiciled there, he was domiciled in the United Kingdom. (2) For the purposes of subsection (1)(b) above the question whether a person was resident in the United Kingdom in any year of assessment shall be determined as for the purposes of income tax, but without regard to any dwelling-house available in the United Kingdom for his use. (3) in this section " the Islands " means the Channel Islands and the Isle of Man"
Section 45 was not materially different in October 1982. Between 1975 and 1982 the provision was amended by the Finance Act 1977 (UK) and the Finance Act 1978 (UK), but in ways that do not affect the analysis set out here. Section 45 was eventually repealed by the Capital Transfer Tax Act 1984 (UK) and presumably re-enacted elsewhere in similar terms.
The evidence before this Court makes it unlikely that the deceased would have satisfied s 45(1)(a), as she was unlikely to have been actually domiciled in the United Kingdom within 3 years preceding a relevant UK tax assessment. But there is a serious question whether she would even have satisfied s 45(1)(b). The evidence on this application for judicial advice certainly leaves open the inference that because of the deceased's regular visits to Australia (which are better documented during the 1950s and the 1960s, than the 1970s), it would be quite difficult for UK revenue authorities to establish that the deceased was a resident in the United Kingdom for 17 of the 20 years between 1962 and her death in 1982. Although given the historical uncertainties in this case, whoever bears the onus of proof on this issue may have the greater practical disadvantage.
It is at least possible therefore that taxation upon the deceased's assets in the United Kingdom, and elsewhere, should be approached on the basis that she was neither domiciled in the United Kingdom nor deemed domiciled in the United Kingdom under Finance Act 1975 (UK), s 45.
In my view, the economics of either retaining or abandoning the UK assets should be approached by the plaintiff examining the estate's relevant tax liability upon both the alternatives: (1) the deceased was deemed domiciled in the UK for tax purposes; and (2) the deceased was not deemed domiciled in the UK for tax purposes. The financial effect of the former alternative is clear: the tax liabilities clearly exceed the UK assets. But on the latter alternative that may not be so. This question may be worthy of closer examination. It does not seem to be resolved by the later KPMG tax advice. It may be of course that even if the deceased was not domiciled in the UK for tax purposes, that the combined effect of tax, penalties and interest mean that the UK tax liabilities still exceed the UK assets. If so, the plaintiff would be justified in abandoning the UK assets and distributing the estate without regard to UK tax liabilities.
On the issue of enforcement, there is still no UK executor and there still appears, on the basis of the submissions made to this Court, to be no effective means for UK revenue authorities to recover any capital transfer tax liability (or other applicable UK tax liability) from non UK assets of the estate.
The plaintiff's submissions demonstrate that the general law principles of Government of India v Taylor still apply between Australia and the United Kingdom and that the United Kingdom tax debts are not able to be enforced against assets in this country. But the principles of Government of India v Taylor are subject to modification by treaties made between Australia and other tax jurisdictions.
The plaintiff has submitted on the basis of its research that there is only one treaty which may potentially modify the principles of Government of India v Taylor in Australia. The OECD ("Model Convention with respect to Taxes on Income and Capital") requires the contracting States of the OECD to lend assistance to each other in the collection of revenue claims: see in particular Article 27. In Australia the Convention is contained in the Taxation Administration Act 1953 (Cth), Schedule 1, Division 263: see also the discussion in Jamison v Commissioner for Internal Revenue (2007) 210 FLR 210; (2007) 66 ATR 441; [2007] NSWSC 324 per Gzell J at [28].
But as Michael Dirkis, Professor of Taxation Law at the Faculty of Law University of Sydney has made clear, the OECD Convention only has a limited effect in modifying the general law position, because the Convention only applies where there is a specific inclusion to that effect in an existing tax treaty, and there is no such inclusion in the existing tax treaties between the UK and Australia: M Dirkis, "Being Caught up by the Past - the Enforcement of Foreign Revenue Debts" (2009) 19(1) Revenue Law Journal 1-6.
On the basis of this statement of the applicable revenue law, the Court advises that provided the incidence of UK tax liability on the deceased's estate may be calculated on all probable scenarios to exceed the estate's assets in the UK, then the plaintiff would be justified in distributing the estate of the deceased in Australia to the estate beneficiaries without regard to United Kingdom taxation liabilities that may be payable by the estate. The plaintiff will need to take steps to indicate to the UK authorities that it is putting into effect a decision to abandon the UK assets.

[31]

The Court's Opinion, Advice and Direction and Orders

The Court's answers to the questions posed to it for advice will require the proceedings to come back for further mention, which is provided for in the orders and directions. For the reasons set out above, the Court therefore makes the following orders: 1. The Court's opinion, advice and direction upon the matters raised relating to the administration of the estate of the late Evelyn Mary Dempsey are given as answers to the questions posed as follows: 1. would the plaintiff be justified in distributing the intestate share of the deceased's estate on the basis that the deceased's domicile at the date of her death was New South Wales? 2. Answer: The Plaintiff is advised that it would be justified in treating the deceased as domiciled in Australia rather than the United Kingdom for the purpose of distributing her intestate estate, but that the plaintiff would not be justified in treating the deceased as domiciled in New South Wales, rather than Queensland, without undertaking the further investigations identified in these reasons. 3. if the answer to (a) above is no, would the plaintiff be justified in distributing the intestate share of the deceased's estate on the basis that the deceased's domicile at the date of her death was Queensland or alternatively the United Kingdom? 4. Answer: This question does not yet arise; see the answer to question (a). 5. in relation to an overpayment of $25,363.64 to the University of Sydney is the plaintiff justified in transferring an amount of $25,363.64 and appropriate interest from the University share accumulated interest currently held in the estate Residue Account administered by the plaintiff to the estate Intestacy Account administered by the plaintiff? 6. Answer: The plaintiff is directed to correspond further with the University of Sydney in accordance with the observations made in these reasons and then to reapproach the Court to seek final advice in relation to question (c). 7. would the plaintiff be justified in distributing the Australian estate of the deceased to the estate beneficiaries without regard to any or all of the United Kingdom taxation liabilities that may be payable by the estate?, and 8. Answer: Yes, provided the plaintiff satisfies itself upon appropriately expert legal and taxation advice that on all reasonable scenarios the estate's UK tax liabilities will exceed the value of the estate's UK assets. 9. advice in relation to payment of Australian tax and any adjustments as between the Residue Account and the Intestacy Account consequent upon advice of the Court given regarding the deceased's domicile at the date of her death. 10. Answer: This question does not yet arise; see the answers to questions (a) and (b). 1. Order that the plaintiff's costs of this application be paid out of the estate on the indemnity basis. 2. Adjourn the proceedings for mention in approximately two months' time at a date to be arranged with my Associate. 3. Grant to the plaintiff liberty to apply.