Bartkus v Bartkus [2010] NSWSC 889 | Case summary

1 This is an application under s 7 of the Family Provision Act 1982 (FPA) by the only daughter of Adomas Bartkus (the deceased) that provision be made for her out of her father's estate. The will 2 The deceased made his last will on 12 August 2008. By that will, he appointed the first and second defendants as his executors and left the whole of his estate to the first defendant, who was, for a period of time, the deceased's second wife and who lived with the deceased at the time of his death. 3 In his will, the deceased explained his decision to leave the whole of his estate to the first defendant in the following terms: "i. My daughter NAOMI BARTKUS received substantial benefit from the estate of her late mother (much of that estate deriving from a family law property settlement which her mother acquired but to which I contributed); ii. Whilst I subsequently married and divorced NIJOLE BARTKUS , we thereafter resided together over many years and she proved herself to be a real friend and support to me during that time and during the time I have suffered illness. I have received real happiness and support from her friendship. The total length of our association has been about fifteen years. iii. I am aware that NIJOLE BARTKUS has little or no assets and that she would be "on the streets" looking for rental accommodation unless I provide for her. iv. Since my daughter has been adequately provided for and has lived in Queensland, I have determined that it would be unwise for me to give limited provision (such as a life estate in my home at Bankstown) to Naomi [sic], and that her future life requires the benefit of my entire estate which I freely give her." The plaintiff 4 The plaintiff is aged 56. She lives in Queensland. The plaintiff's mother, Katherine Bartkus, and the deceased divorced in about 1980, when the plaintiff was in her late 20s. As part of the divorce settlement, the deceased received a property at Bankstown and the plaintiff's mother received a property at Greenacre. In 1996, the plaintiff's mother committed suicide. The deceased went to the funeral and it was there that the plaintiff learned that the deceased had married the first defendant in April 1995. 5 The plaintiff received approximately $120,000 from her mother's estate. 6 The plaintiff was in a de facto relationship for approximately 13 years. She has two children, Ryann who is 26 and Justin who is 22. 7 The plaintiff suffers from depression and anxiety for which she has been taking medication for the past eight years. She has chronic neck and shoulder problems from injuries she sustained in a car accident. She also suffers from severe sciatica pain. 8 The plaintiff has assets of approximately $164,000, which consist of approximately $147,000 held in various bank accounts and term deposits and a motor vehicle worth approximately $17,000. She is unemployed and in receipt of Centrelink Newstart benefits. Recently, she started working for Queensland Health from one to three days per week for approximately four to six hours per day assisting elderly people with cleaning and shopping. She earns $24 gross per hour for that work, although she does not know for how long she can continue because of her health issues. She lives in rented accommodation. 9 The plaintiff received a house on land in Currumbin Valley, Queensland as a result of a property settlement with her de facto partner and, during the period from about 1990 to 2006, she bought and sold a series of houses in which she lived. It appears that the last house was at Varsity Lakes in Queensland, which she sold in 2006 for $315,000. The plaintiff transferred the bulk of that money to superannuation. However, she then commenced making substantial drawings on her superannuation account with the result that she now has $147,000, which, as I have said, is currently held in various bank accounts and term deposits. The money withdrawn by the plaintiff appears largely to have been dissipated. 10 The plaintiff had a normal relationship with her father. They were obviously not particularly close. However, they appear to have remained in contact. The deceased visited the plaintiff with the first defendant in Queensland on at least one occasion and the plaintiff came to Sydney to see her father on a number of occasions when he was in hospital. At one stage, in 1996, the deceased made a will in which he appointed the plaintiff as his executor and left her his estate. The first defendant 11 The first defendant was born in November 1941 in Lithuania. She married her first husband in 1966 and the following year their only child, Tomas, was born. In 1970 or 1971, the first defendant completed a masters degree in economics at Vilnius University. Subsequently, she worked in an administrative position in the economics faculty of the university. Her first husband died in 1992 unexpectedly of a heart attack. The first defendant came to Australia in 1994 as a member of the Lithuanian team for the Masters Games held in Brisbane. Due to illness, she was unable to compete and remained in Sydney. It was at that time that she met the deceased. They married in 1995. At that time, the deceased was 68 years old and the first defendant was 53 years old. 12 From about 1998 the relationship between the deceased and the first defendant became strained. The first defendant says that the deceased became very jealous of her friends and, at one stage, commenced proceedings against her in the Local Court at Bankstown. From time to time he would not speak to her for periods of up to two weeks. 13 In the second half of 1998, the deceased proposed that he and the first defendant get a divorce. It appears that the reason for that proposal was that the deceased thought that they would each be entitled to larger pensions as single pensioners. The divorce occurred and the deceased paid the first defendant $20,000 as a property settlement. He also paid for a return airline ticket to Adelaide for the first defendant and told her that she must go there for a period of three months. He said at the time that the divorce was just a formality. The deceased and the first defendant kept in regular contact while she was in Adelaide. The first defendant returned to Sydney in March 1999. The deceased collected her from the airport and she returned with him to their home at Bankstown. They continued to sleep in the same bed and resumed a sexual relationship. For the most part, they lived together happily. 14 In late 1999 or early 2000, the deceased became infected with golden staphylococcus. He was hospitalised for one and a half months and the first defendant used to spend about six hours a day with him during that time. When he was discharged, the first defendant looked after him. 15 In 2005, the deceased was diagnosed with bowel cancer and underwent surgery to remove it. He was in hospital for approximately one month and again the first defendant visited him every day and took food into him most days. Again, she nursed him when he returned home. In 2005 and in 2007, they made trips to Lithuania. On the second trip, he was diagnosed with cancer of the rectum. From then on, the first defendant nursed the deceased until his death. 16 The only substantial asset of the deceased's estate is the house at Bankstown, which is estimated to be worth $430,000. The deceased also had an amount of approximately $41,000 in various bank accounts and term deposits. That amount is not sufficient to cover the liabilities of the estate which include funeral expenses, the first defendant's costs of going to Lithuania to return the deceased's ashes there, legal fees and the repayment to Centrelink of approximately $20,000 over claimed by the deceased. In addition, the first defendant owes Centrelink $20,000. She has reached an arrangement to repay that amount over time. As a result, her pension has been reduced by $118.05 per week so that she receives $287.50 per week. The defendants' legal advisors have agreed not to insist on payment of their accounts during the life of the first defendant or until the sale of the Bankstown property. 17 Until recently the first defendant earned $55 per week from a casual job, but that job has finished and she is looking for alternative employment. The only other asset owned by the first defendant is an apartment in Vilnius, which is estimated to be worth $75,000. That apartment is occupied by her son and his family. Should an order be made? 18 Whether an order should be made under s 7 of the FPA raises two questions. The first is whether the plaintiff has been left without adequate provision for her proper maintenance, education and advancement in life. The second is, assuming she has, what provision, if any, should be made for her: Singer v Berghouse (No. 2) [1994] HCA 40; (1994) 181 CLR 201, Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191. The assessment is to be made having regard to the circumstances as they exist at the time the order is made: FPA s 7. In considering the first stage, the court is required to consider all the circumstances of the case including "the applicant's financial position, the size and nature of the deceased's estate, the totality of the relationship between the applicant and the deceased, and the relationship between the deceased and other persons who have legitimate claims upon his or her bounty": Singer v Berghouse (No. 2) [1994] HCA 40; (1994) 181 CLR 201 at 210 per Mason CJ, Deane and McHugh JJ. 19 The plaintiff recognises that, in this case, the first defendant has a strong competing claim and that it would not be appropriate for the court to make an order that would have the effect of requiring the first defendant to sell the house at Bankstown. As a result, the plaintiff proposes that the court make an order that would, in effect, give the first defendant a life interest in the house at Bankstown or a substitute property and the remainder to the plaintiff: cf Crisp v Burns Philp Trustee Co Ltd, Holland J, SCNSW, 18 December 1979, unreported. In support of that submission, the plaintiff relied on the decision of Macready AsJ in Borham v Montague [2006] NSWSC 1289. In that case, the value of the estate was approximately $1,200,000. The estate included a house at Taree. The deceased had six children all of whom were in financial need. The deceased left his second wife, to whom he had been married for twelve years, a life estate plus one-seventh of the remainder after the payment of a number of specific legacies. His Honour pointed out that a widow was not necessarily entitled to be bequeathed the matrimonial home absolutely. In that case, his Honour thought that further provision of $75,000 from the estate in favour of the widow was sufficient. 20 I do not accept that Borham is analogous to this case. In Borham, the widow had been left a life estate and the application was by her for further provision. In this case, the first defendant has been left the whole estate. Consequently, the question in Borham was whether the provision for the wife was adequate. The question is this case is whether the provision for the daughter is adequate. Those two questions do not raise the same issue. A finding that the wife in Borham was left with adequate provision (with some adjustment) is not equivalent to a finding that, if the wife had been left the house absolutely, the children in that case would have been left with inadequate provision. The difference is between what is necessary to achieve adequate provision and what may be possible before inadequate provision is made for another person who has a legitimate claim to be considered by the deceased. That is another way of saying that the court should respect the deceased's wishes and only do what is necessary to achieve the purpose of the Act: see The Pontifical Society for the Propogation of the Faith and St Charles Seminary, Perth v Scales (1962) 107 CLR 9 at 19; Golosky v Golosky, NSWCA, 5 October 1993, unreported. 21 In any event, in Borham the deceased had left the widow a proportion of the estate and Macready AsJ made a further provision for her. In doing so, his Honour recognised that "It is often the case that people of [advanced years] do need expensive services which are commonly not provided for in nursing homes but are of great benefit to people in their advancing years" (at [61]). That need can only be secured by a capital sum. 22 In my opinion, the plaintiff was left with adequate provision in this case. Although the deceased and the first defendant were divorced, it is clear that that divorce was forced on her as part of a scheme by the deceased to defraud Centrelink. The first defendant is in the position of a widow who sacrificed a number of years of her life nursing the deceased through the terminal stages of his cancer. She has no real assets to speak of. I do not think that it is reasonable to expect her to sell her apartment in Vilnius. In any event, that will not raise a substantial sum of money. She is entitled to a capital sum to assist her in her old age if necessary. Indeed, that is precisely the basis on which the plaintiff's need is put. However, the consequence of accommodating that need will be to deprive the first defendant of exactly what the plaintiff says is her need. This is a case in which both needs cannot be satisfied, and where the deceased chose the needs of the first defendant in circumstances where the first defendant had looked after him for a period of several years. 23 It is true, of course, that the plaintiff's needs are substantial, and they are no less so because it appears that she has been imprudent in dealing with the money she realised from the sale of the house at Varsity Lakes: see, eg, Carroll v Cowburn [2002] NSWSC 248. However, having regard to the position of the first defendant, I do not think that the deceased failed to make adequate provision for her proper maintenance etc. 24 That leaves the question of costs. As in other cases, the general principle in cases under the FPA is that an unsuccessful plaintiff should pay the defendant's costs. However, in exercising its discretion in relation to costs the court will have regard to the overall justice of the case and, as a result, the court may be more willing to depart from the general principle than in other types of case: Moussa v Moussa [2006] NSWSC 509; Carey v Robson [2009] NSWSC 1199. In this case, in my opinion, it is appropriate to depart from the general principle. This is a case where the plaintiff's case failed not because she failed to establish a need, but because of the size of the estate and the competing claim of the first defendant. The plaintiff took a reasonable approach in trying to accommodate these facts. Ultimately, I have found that she has failed, but I do not think that she acted unreasonably in bringing the claim that she did. The result of not making an order for costs against the plaintiff is that the defendants' solicitors may have to wait until they are paid. However, there are some arrangements in place where that will happen without imposing a substantial burden on the first defendant. In those circumstances, I make no order in relation to costs with the intention that each party bear their own costs.

Bartkus v Bartkus

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