Baumanis bht Baumanis v Brennan

Baumanis bht Baumanis v Brennan - [2024] NSWSC 681 - NSWSC 2024 case summary — Zoe

[4]

The factual background

The deceased was born on 9 May 1964. He attended Avondale High School, where he first met the defendant in about 1980.
After leaving school, the deceased and the defendant commenced a relationship. They remained together for several years. For most of that time they lived in a house at Cessnock. Their relationship ended in 1984.
The deceased met Mrs Baumanis on 4 November 1988 and they were married on 16 March 1991. They remained together until they separated on 27 December 2013. Between the time they met and the time of their marriage, the deceased built a house in Kurri Kurri which they shared as their first home. They both worked long hours to pay for this home.
In 1995 they borrowed to purchase eight acres of land at Abermain, on which they later built a family home. This was completed in about 2002.
They had four children: 1. Corey, born in 1996, currently aged 27. 2. Jacinta, born in 2000, currently aged 24. 3. Nikolai, born in 2002, currently aged 21. 4. Dustin, born in 2007, currently aged 16.
I will describe the children's individual circumstances in more detail in due course. For the moment, it is relevant to note that Corey was born with severe physical and mental disabilities. He was diagnosed with severe cerebral palsy, epilepsy and vision impairment in the first 12 months of his life. He lives at home and Mrs Baumanis is his primary carer.
Prior to his separation from Mrs Baumanis, the deceased had been a loving father who adored his children. Nikolai recalls that his father was deeply interested in the children, their interests and ideas. He was an excellent teacher and supported the children in all their endeavours. Nikolai saw him as a mentor. To this day, he acknowledges his father's role in shaping the way he sees the world. Jacinta recalls that there was a strong father-daughter bond between them and, like Nikolai, she recalls her father as being deeply engaged with her and her interests.
The deceased was a constant presence at home. He was a close and attentive parent. He attended school events when work permitted.
In December 2013 the deceased informed his wife, Mrs Baumanis, that he felt he was having a breakdown and that he "didn't want to do 'this' for another 20 years." His doctor prescribed anti-depressant medication for him, but he refused to take it.
After a short holiday by himself just before Christmas, the deceased returned to his family only to inform them that he needed to go and live by himself. He told his wife that he had never wanted children and that he thought a seizure would have 'taken' Corey by now. He said to his wife "we're living your dream, not mine."
On 27 December 2013, the deceased left the family home. From that day onwards there was only limited contact between the deceased and his children. The evidence demonstrated that, overall, the deceased's efforts to keep in touch with his young children were sporadic and desultory.
The deceased and Mrs Baumanis reached a property settlement in June 2017. The basis of the split was that Mrs Baumanis received 55% in value of the marital assets and the deceased received 45%. Mrs Baumanis retained the Abermain home (which was important, as it had been modified for Corey) but has subsequently worked hard to service the mortgage. She had to borrow money to pay the deceased for the settlement. The total asset pool seems to have had a value or around $1,300,000, but the evidence about this is indistinct. They eventually divorced in 2019.
The deceased and the defendant met again by chance in early 2014. Their relationship re-commenced in mid-2014. They moved in together in about September or October 2014.
In August 2017 the deceased used the funds he had received from the property settlement with Mrs Baumanis to purchase a house in Victoria Street, Maitland. The purchase price was $325,000. Soon after, the deceased and the defendant decided to get married. For several months in late 2017 the defendant was actively engaged in trying to renovate the Victoria Street property. They moved into that property in early January 2018.
In June 2018, the deceased purchased a further property in Lee Street, Maitland. The purchase price was $355,000. That property was rented out for about $400 per week. It remained tenanted until some time in late 2021.
In August 2018, the deceased was diagnosed with prostate cancer. The defendant was generally supportive of him throughout his illness.
Between February and June 2021, the deceased received payments from his superannuation fund as follows: 1. on or about 23 February 2021: $500,012.32; 2. on or about 14 April 2021: $200,032.31; and 3. on or about 10 June 2021: $1,615,754.14.
These amounts apparently represented his account balance together with the proceeds of a terminal illness payment from his life insurer.
It is at this point that the evidence as to the deceased's financial affairs grows dim. The defendant's evidence about financial matters was badly prepared and she herself had a poor grasp of it. Although named as executor, she has not sought probate of the deceased's will. She presented some evidence as to the deceased's bank accounts and other matters but gave no assurance that that evidence amounted to a complete, or even near-complete, picture of his financial position as at July 2022 when he died. As I will explain below, the defendant was also quite dishonest about some aspects of her own finances and the cash which, it emerged, she drew directly from the deceased's accounts as he lay dying.
Nonetheless, it seems that at least the following things occurred: 1. The deceased placed some of the funds received from MLC into new superannuation accounts with Australian Super, including an amount of $100,000 for the defendant. In respect of his own Australian Super account, he completed a binding death benefit nomination in favour of the defendant. There was no clear evidence as to how much he placed into superannuation for his own benefit. 2. He also opened bank accounts in their joint names and put a total of about $40,000 into them. He moved some cash from an account in his name to an account in the defendant's name. It is not clear whether these movements were by way of gift. 3. On 4 July 2022, being the day the deceased died but, presumably, after he had died (he died at about 4:00am), MLC paid $375,000 into a joint account in the name of the defendant and the deceased.
Returning to the narrative, in April 2021, the deceased purchased a property on Ballydoyle Drive, Ashtonfield, for $784,000.
In June 2021, using the funds recently received from MLC, the defendant paid out the mortgages on each of the three properties as follows: 1. Victoria St: $298,000; 2. Lee St: $320,000; and 3. Ashtonfield: $680,000.
The defendant's evidence does not allow me to reach a conclusion about what the deceased did with the whole of the sums he received from MLC. Clearly enough, he used $1,298,000 to discharge the mortgages over the three properties. That should have left a balance of around $1,000,000. Some of that sum can be readily accounted for. For example, he bought two cars for the defendant. He also placed some money into superannuation as I have mentioned above.
So far as the defendant is concerned, there does not seem to be any doubt that the substantial cash balances which the defendant now holds (which I will describe in a little more detail below) were overwhelmingly sourced from a combination of the cash which the deceased received from MLC while he was alive, the cash which was deposited into their joint account by MLC on 4 July 2022, and cash paid to her from the deceased's superannuation pursuant to a binding death benefit nomination.
On about 15 October 2021 the defendant and the deceased moved into the Lee Street property. The Victoria Street property at this point was still in a fairly unrenovated state and was unsuitable for the deceased to live in with his illness.
On 18 October 2021 the defendant had a bad fall and fractured the elbow of her dominant left arm while at the Ashtonfield property. This necessitated surgery and a lengthy hospital stay. She suffers permanent nerve damage as a result of that accident.
The deceased's health generally declined. The cancer spread and his quality of life became very poor. He became very dependent on the defendant. He suffered numerous spontaneous bone fractures.
The deceased made a will on 18 March 2022. He appointed the defendant to be his executor and in circumstances where the defendant survived him, left the whole of the residue to her, after the following gifts: 1. to Nikolai, his watch; 2. to Dustin, his pocket knife; and 3. to Jacinta, his wedding ring from his marriage to Mrs Baumanis.
He made no mention of Corey in his will.
The defendant and the deceased were married on 21 March 2022.
On 23 March 2022, the deceased instructed his solicitor that he wished to have the defendant "added to the titles as a joint tenant, thus avoiding the Probate issue when I pass on". He also said that they would declare the Ashtonfield property for duty purposes to be their usual place of residence, but I do not know whether that was true or not at the time. On the basis of Ms Brennan's evidence in this proceeding, that seems unlikely to be the case. I note, in this respect, that the deceased's death certificate records his and Ms Brennan's addresses as a property in Wallsend Road, Cardiff Heights, that is seemingly owned by Mr Baumanis's sister, Anita Agafonoff, who gave evidence in this proceeding for the plaintiffs. In any case, in his instructions to his solicitor, the deceased said that he would pay fees and duty on the other two properties as a result of the defendant being added to the title.
These things, apparently, occurred. Title to each of the properties was transferred to them as joint tenants.
The defendant did not explain what the "probate issue" was. The transfer of an interest in the properties will have cost the deceased many thousands of dollars in duty, although I note that there was no evidence as to the value which the parties ascribed to the properties for duty purposes. The deceased will also have been required to pay income tax on the gain which he was deemed to have made on transferring an interest in these properties to the defendant. Because they did not deal with other at arm's length, he is taken to have received capital proceeds equal to the market value of the property disposed of: s 112-20 of the Income Tax Assessment Act 1997 (Cth).
Also in evidence was a document entitled "Personal Instructions/Information to the Trustee & Executor" dated 26 March 2022. It records that the defendant made significant financial contributions to the renovation of his "1st home" and that she had paid all of his legal bills. This was untrue. Nonetheless, the document purports to spell out the deceased's intention that the defendant should not be "liable to pass on any share of 'perceived entitlement' to any of the children or the ex-wife" (sic). It expressed the view, also untrue, that the children had estranged themselves from him and that they had disowned him. He said that they should not be notified of his death until 12 months after burial or cremation. It also said that they were not to receive their gifts until that time also.
When these circumstances are put together, I infer that the deceased's motivation was not a "probate" issue at all. Rather, the deceased and the defendant wanted to ensure that the three properties did not fall into the deceased's estate and become subject to a family provision claim by the children. They went to significant and expensive lengths to try to achieve that goal.
The deceased was finally admitted to hospital for the final time in mid-June 2022. Scans revealed that he had a brain tumour.
The defendant did not notify the children that their father lay dying, nor of the fact of his death. She claims to have encouraged him to see his children on several occasions and that she was "heartbroken" that he did not wish to see them, but I do not believe her. She has displayed no empathy towards the children at any point during this litigation.
In late June, the deceased's sister, Helen, contacted him to see if they might catch up. Helen received a response on or around 1 July purporting to be from the deceased. It was in fact from the defendant using the deceased's phone. She and her sister, Anita, visited the deceased that day. They found him deeply unconscious. They then brought their mother to visit. She was distressed to learn of her son's condition and that it had been concealed from her.
The defendant informed Anita while they were at the hospital that the deceased had changed his will and that she was now the executor. It had previously been Anita. She said that "he told me he did not want the children to be told of his passing until 12 months had passed. When he passes there will be something for the kids in his will."
The deceased remained unconscious until his death in the early morning of 4 July.
The defendant texted Anita to ask that she not inform the plaintiffs or their mother of the fact that the deceased had died.
The defendant did not take any steps to forward the gifts mentioned in the will to Jacinta, Nikolai and Dustin until shortly prior to the hearing. She arranged for a process server to deliver the gifts.

[5]

Corey

I have already described Corey's general circumstances above. He suffers from severe cerebral palsy, dystonic quadriplegia which affects the function in all four of his limbs and trunk, epilepsy, vision impairment and hip dislocation. He suffers from seizures frequently, including several times each night. Corey requires care 24 hours per day.
Corey receives an NDIS package that has a value of just over $500,000 per year; whatever of that is not used (if any) is forfeited back to the National Disability Insurance Agency. He receives a disability support pension of $2,278.30 per month. Most of his monthly expenditure is covered by the NDIS, although Mrs Baumanis fears that the future of this scheme may not be guaranteed. This causes her understandable concern. He has approximately $35,000 cash in the bank. He has no liabilities.
Mrs Baumanis is Corey's primary carer. She is concerned about how Corey will be cared for in the event he survives her or if she ceases to be able to provide care for him at any time. Dustin, who lives at home, also provides care to Corey but will inevitably move away to pursue his own life.
Mrs Baumanis gave detailed evidence as to the care which she provides to Corey in addition to that provided at the expense of the NDIS. She attends to him on several occasions every night. It is simply not possible for him to be left alone. If she is for any reason unable to care for Corey at any particular time outside of the times he receives the assistance pursuant to the NDIS, she must meet that expense herself.
Her evidence, which was not disputed, was that a qualified person to assist Sharon and Dustin in caring for Corey on weekends from 4pm to 8am would cost approximately $175,000 for one year alone.
Corey had what his mother describes as a father/son, carer/patient relationship with the deceased. He missed his dad and was hurt that the deceased chose not to see him.
If provision is made for Corey, Mrs Baumanis would like to use those funds to purchase a new wheelchair accessible van. His current van, which is owned by Mrs Baumanis for obvious reasons but which she considers to be Corey's car, is 18 years old and has very high mileage. Between the hearing on 20 May and the hearing on 23 May, the van broke down. It requires a new transmission which will cost $7,000. The cost of a suitable new van, together with the work required to convert it to wheelchair use, will be $99,766.36.
Mrs Baumanis seeks an order for provision on Corey's behalf that would cover his immediate financial needs, being a new van, and which would provide some buffer against contingencies.

[9]

Jacinta

Jacinta was close to her father. I have already referred to the strong connection she had with him as a child. Like the others, the estrangement was not what she wished.
Jacinta has been working in events management since leaving high school. She has obtained a fast-track diploma in that field and hopes to complete a further diploma course. If she had had financial assistance at the time of leaving school, she would have pursued a more advanced course of study. The TAFE course she chose was one she could afford at the time.
Jacinta is self-employed as a contracted touring operations staff member for Circus Royale Australia. She travels extensively and organises events around the country. When not traveling for work she lives at home with her mother.
Jacinta's annual income is about $44,200. She has very little job security. For example, she has no leave entitlements. She has a boyfriend who also works for the circus, on similar terms to Jacinta. She describes him as a de facto partner but they have never lived together, except whilst traveling. He has no assets of any significance.
Jacinta has monthly expenditure of about $3,280.
She has paid for her own education at TAFE to date. She would like to continue studying. She would like to study for a bachelor's degree, which would cost about $48,699 over three years. She would need to quit her current role if she were to pursue that course and thus would need funds to live off.
Jacinta currently lives most of the time in a caravan provided by the Circus Royale. If she were to continue in her current role or if she were to return to her current role after studying, she would wish to purchase her own touring vehicle and trailer, which would be quite expensive. She estimates that the car and trailer together would cost almost $300,000. This would be an alternative to renting or purchasing a house, at least in the short term. She has long term ambitions which include owning and operating her own show. This would be an expensive undertaking, costing several hundred thousand dollars.
If Jacinta were to receive money by way of provision, she would primarily use it to further her education. She would also begin building a deposit for home ownership or for the other pursuits mentioned above.

[13]

Applicable law

Part 3.3 of the Succession Act provides for the making of notional estate orders. Section 78 provides that the Court may make an order designating property as notional estate only for the purposes of a family provision order to be made under Part 3.2, or for the purposes of an order that the whole or part of the costs of the proceedings be paid from the notional estate. For reasons explained below, this is a case where it is appropriate to make an order for provision, as well as orders for costs, to come out of the deceased's notional estate.
Section 80 provides as follows: "(1) The Court may, on application by an applicant for a family provision order or on its own motion, make a notional estate order designating property specified in the order as notional estate of a deceased person if the Court is satisfied that the deceased person entered into a relevant property transaction before his or her death and that the transaction is a transaction to which this section applies. (2) This section applies to the following relevant property transactions - (a) a transaction that took effect within 3 years before the date of the death of the deceased person and was entered into with the intention, wholly or partly, of denying or limiting provision being made out of the estate of the deceased person for the maintenance, education or advancement in life of any person who is entitled to apply for a family provision order, (b) a transaction that took effect within one year before the date of the death of the deceased person and was entered into when the deceased person had a moral obligation to make adequate provision, by will or otherwise, for the proper maintenance, education or advancement in life of any person who is entitled to apply for a family provision order which was substantially greater than any moral obligation of the deceased person to enter into the transaction, (c) a transaction that took effect or is to take effect on or after the deceased person's death. (3) Property may be designated as notional estate by a notional estate order under this section if it is property that is held by, or on trust for - (a) a person by whom property became held (whether or not as trustee) as the result of a relevant property transaction, or (b) the object of a trust for which property became held on trust as the result of a relevant property transaction, whether or not the property was the subject of the relevant property transaction."
The expression "relevant property transaction" is defined in s 75. Subsection (1)(a) provides: "(1) A person enters into a relevant property transaction if the person does, directly or indirectly, or does not do, any act that (immediately or at some later time) results in property being - (a) held by another person (whether or not as trustee)"
Examples of relevant property transactions are given in s 76. They include, relevantly, in subsection (2)(b): "if a person holds an interest in property as a joint tenant and the person does not sever that interest before ceasing (because of death or the occurrence of any other event) to be entitled to do so, with the result that, on the person's death, the property becomes, by operation of the right of survivorship, held by another person (whether or not as trustee) or subject to a trust"

[14]

Relevant transactions

The defendant accepts that there were two relevant transactions in relation to each property. The first relevant transaction was the transfer of each property into the joint names of the deceased and the defendant. The second relevant transaction was the failure to sever the resulting joint tenancy prior to death.
These transactions occurred within a year of his death for no or only nominal consideration and at a time when the deceased had a moral obligation to make provision for his children. They were all transactions within the description in s 80(2)(b).
In my view, they also meet the description in subsection (2)(a). The deceased deliberately set out to ensure that the properties did not fall into his estate and he did so for the express reason that he did not want provision to be made out of his estate for his children. I will describe the basis for this conclusion below.
It follows that the whole of the defendant's interest in each of the properties may be the subject of a notional estate order.
The defendant also accepts that relevant transactions occurred in relation to cash which the defendant received from the deceased in the year prior to his death and in relation to cash which the defendant received from the deceased's superannuation trustee or trustees. The evidence shows that the following sums (at least) meet this description: 1. An amount of $447,676.02 paid to the defendant by Australian Super on 13 July 2023. This amount was paid into the defendant's Westpac account ending #985. That account had a balance of $376,206.81 as at 12 April 2024. 2. An amount of $375,000 paid by MLC on 4 July 2022. This amount was paid into the joint account of the deceased and the defendant at NAB, account ending #267. Over the following weeks, transfers exceeding that amount were made from the joint account into an NAB account in the sole name of the defendant. The defendant did not say why she transferred these sums into accounts in her sole name.
The defendant submitted that the cash that may be capable of being designated as notional estate was $447,676.02 (being the amount paid into her Westpac account) and $417,900 (being the amounts paid into her NAB account). I am satisfied that this submission is correct. I accept it.
The defendant's 14 May 2024 affidavit includes a schedule of her assets and liabilities. It says that, at that point, the Westpac account had a balance of $341,599.89 and the NAB account had a balance of $278,958.67. This suggests that in the 22 months since July 2022, the defendant withdrew about $250,000 from her accounts. The evidence does not show how this money was spent.
So far as real property is concerned, the valuation evidence took the form of short-form appraisals by local real estate agents. The evidence was not particularly contentious but I am inclined to prefer the defendant's evidence in this respect. This is because the defendant's evidence was obtained slightly closer to the hearing and it is clear that the agent had access to the properties for the purpose. The real estate agent engaged by the defendant put the following values on the properties as at 15 May 2024: 1. Victoria Street: $730,000 to $770,000 once renovations are completed. He noted that painting, flooring and bathroom renovations were ongoing. 2. Lee Street: $580,000 to $620,000 in its current condition. 3. Ashtonfield: $930,000 to $960,000 in its current condition. He noted that there was damage to internal and external doors and that there were 'issues' with the pool.
The midpoints of these values are $750,000, $600,000 and $945,000.
In my view, the total value of property (including cash) in relation to which a notional estate order could be made is $3,160,576.02.
Before turning to the circumstances of the individual plaintiffs, it is relevant to record my findings as to two additional matters, namely the question of the defendant's contributions to the properties and the reliability of the defendant's evidence generally.

[15]

The defendant's contributions to the properties

The defendant claims to have contributed "significantly" to improvements and renovations to the properties. This claim forms part of her wider submission that in all of the circumstances I would only order modest provision for the plaintiffs because any provision will come out of the value of properties to which she claims to be entitled and to which she claims to have contributed.
Her evidence as to this matter was disorganised and difficult to follow. There is little value in traversing it. I find the position to be this: the defendant contributed no more than $5,000 towards the Victoria Street property by way of covering the deceased's conveyancing costs and some minor hardware purchases at about the time of purchase. In relation to the Lee Street property, she contributed an equally small amount by way of covering the costs of some minor maintenance prior to the house being rented out.
In 2017 she gave up paid employment in order to focus on renovating the Victoria Street property but she has not done a good job of it. Despite her efforts, the property has never been particularly liveable. In mid-2022 it was badly affected by flooding and the defendant has still not repaired it, despite having the resources to do so.
The defendant has been derelict in the maintenance of all of the properties. Her lack of attention to this matter is inexplicable. The Ashtonfield property suffered some damage in late 2023 when, according to the defendant's evidence (although she was not personally present), the police forced their way in, apparently whilst conducting a welfare check. Windows and doors have been broken and the property is not secure. In the five months since that time, the defendant taken no steps whatsoever to secure the property. She says that she was told by the police not to fix the locks and that they would instead attend to it. I do not believe this. She also says that the pool is leaking and needs repair. This, I believe. It is corroborated by observations made by a real estate agent who inspected the property.
The Ashtonfield property has never been tenanted.
The Lee Street property was tenanted until October 2021, but not since. It requires some important but uncomplicated repairs to make it comfortably habitable, which the defendant has not attended to.
The defendant is not without means to attend to any of the matters mentioned above. She has many hundreds of thousands of dollars in bank accounts as noted above.
The position is that the defendant made some minor contribution to the properties in the time prior to the deceased's death. Her contribution was not significant. Since becoming the sole owner of the properties in July 2022 she has been negligent in looking after them.

[16]

The reliability of the defendant's evidence

In order to explain my conclusions about the general reliability of the defendant's evidence, I need to say something about the history of the proceedings.
The proceedings were commenced on 29 June 2023. An amended summons was filed on 19 September 2023. They were listed before the registrar, for the purpose of fixing a final hearing, by Meek J on 3 November 2023. By that time, the defendant had been served with the originating process pursuant to orders for substituted service made on 26 October 2023, but had not appeared. Subsequent to the proceedings being set down, further correspondence was sent to her at the Ashtonfield property by the same means as had been ordered for substituted service. This included postage by registered mail and hand delivery. The original dates for final hearing were 25 and 26 March 2024.
The defendant attended Court for the hearing of the matter on 25 March 2024 and was represented by counsel. I was informed from the bar table that she had not been aware of the proceedings because she did not live at the Ashtonfield property, which is where the documents had been served. I was told by Mr Burke, then her counsel, that she had only become aware of the matter on the preceding Friday, 22 March 2024.
The hearing commenced and the plaintiffs' evidence was read, without objection. The defendant had at that point prepared an affidavit sworn on 24 March 2024. This affidavit was provided to the plaintiffs but, in the events which happened, not read. It seems that having provided this affidavit to the plaintiffs, the parties reached an in-principle agreement about resolving the matter. I therefore vacated the further hearing of the matter to allow the parties to bring in short minutes of order.
However, on 9 April 2024, I was informed that the parties could not reach agreement and so I made orders and directions (at a hearing the following day) to prepare the matter for a resumed hearing in May.
The evidence on which the defendant relied at the May hearing (the matter was eventually heard on 20 and 23 May) was contained in an affidavit sworn on 14 May 2024. In that affidavit, she said that she had been unaware of the proceedings until 22 March 2024, namely until the Friday prior to the original hearing date. Her evidence was that she was unaware of the attempts to serve her because she was staying at a holiday park in Shoal Bay for two whole months between October and 23 December 2023 and that, in the whole of the second half of 2023, she only actually went to the Ashtonfield property on two occasions. She tendered a receipt from the holiday park which was quizzical. It seemed to show that she received a refund of a security deposit in the sum of $180 on 20 December 2023. Alternatively, it shows that she paid a security deposit of $180 on that day. Either way, it is not consistent with her evidence that she checked out of the holiday park on 23 December.
Yet she also said that she had "people" who went to her various properties "every day" and that if any mail were sent there, those people would tell her. She said every week there was a "lawns person and a watering person" as well as "sticky beak" neighbours who keep an eye on things. She was confident that if mail were sent there, she would have received it.
The evidence shows that process in these proceedings was served by registered mail as well as by delivering documents to the Ashtonfield property pursuant to orders for substituted service. This happened on more than one occasion. There was evidence from a process server that he attended the Ashtonfield property in early December 2023 and that he was told by neighbours that the defendant lived there. He knocked on the door and a woman answered. When he attempted to serve her with documents, she said "f*** off". The process server was not cross examined on this evidence. There was also evidence that the mail-box had been cleared.
I find that the defendant knew about the proceedings at some point during late 2023 but chose not to take any action to participate until immediately prior to the date of the first hearing.
So far as the substance of the matter was concerned, the account of her circumstances contained in the 14 May affidavit was completely at odds with the account contained in the 24 March affidavit. The differences are significant. For example, in her 24 March affidavit she swore that she paid the whole of the deposits for all three properties; that the Ashtonfield property was "not habitable"; that she had about $54,000 in superannuation and that she was "living off money in a Westpac account" which had a balance of "maybe $30,000 or $40,000". She also swore that she had been unaware of the proceedings because she had not been to the Ashtonfield property since December 2023 and, prior to that, had not been there at all since July 2023. She swore that the Victoria Street property was worth only $200,000.
These assertions were false in almost every particular.
I have already made findings as to the defendant's assets but it is relevant to note what she herself said about the position in her 14 May affidavit. As to her assets, she identified the following: Victoria St, Maitland E$735,000 Lee St, Maitland E$577,250 Ballydoyle Dr, Ashtonfield E$925,000 Toyota Yaris $35,400 Isuzu $36,000 Newcastle Permanent Bank Account $4,516.18 NAB Bank Account $278,958.57 Westpac Bank Account $341,599.89 Superannuation $199,109 Caravans (1973 & 1982 - both water damaged) $1,000 Household contents and personal effects $5,500 TOTAL $3,139,334

[17]

The 24 March affidavit was therefore highly misleading. I do not accept that the manifest errors in the document can be attributed to the fact that the defendant had so little time to prepare the affidavit. As I have already found, I do not believe that she was unaware of the proceedings until 22 March as she claims. In any event, the complete misstatement of her own basic financial circumstances will have been glaringly obvious to her at the time she prepared the affidavit.
Counsel for the defendant pointed out that she did not read the 24 March affidavit into evidence, only the 14 May affidavit containing the true position (or, at least, less false position) at the resumed hearing of the matter. But that is hardly to the point. The defendant swore an affidavit for the purpose of these proceedings which was self-evidently false. It was handed over to the plaintiffs in Court. It may well have induced them to settle the proceedings on a false basis, although in the fulness of time that did not occur. Moreover, the affidavit was false about matters that go to the very heart of the issues in dispute.
Furthermore, I find that the account of the defendant's financial circumstances which she gives in her 14 May 2024 affidavit is itself misleading in some material respects.
In her 14 May affidavit she records only two liabilities as follows: 1. Loan from Brian Traylen to [the deceased] $31,000 2. Repair and renovation expenses $36,000. Mr Traylen is a close friend of the defendant with whom she is presently "mostly staying". He is a retired financial planner.
The loan from Mr Traylen is a loan which she claims was owed by the estate but which, she says, she will pay. As to why she recognises this amount as a loan and has kept it on foot for so long whilst all the while supposedly paying Mr Traylen many thousands of dollars per month for "expenditure" (as to which, see the following paragraph) she did not say. There was no evidence as to what the $36,000 liability related to.
So far as expenditure is concerned, the defendant presented a quite fanciful list of her claimed expenditure, which she says totals some $10,338 per month. Many significant items on that list seem to be completely made up. She claims to have "home assistance" expenses of $1,200 per month, but she admitted in cross examination that the only person providing "home assistance" was Mr Traylen, whom she describes a "very close friend" with whom she is "largely staying" at the moment. There was no evidence that she actually pays him for "home assistance" at all. She also separately listed $600 per month in "carer's fees" which, on cross-examination, also turned out to be a reference to Mr Traylen. In addition to all the other money she claims to pay Mr Traylen, she claims to pay several hundred dollars per month for petrol and food for him. She claims to be paying over $1000 per month to store the deceased's goods, such as old floorboards, which she says she keeps for sentimental reasons.
In relation to the Victoria Street property, the defendant gave evidence that the costs of work required to repair the flood damage was about $146,500. But in cross-examination this was shown to be a wildly inflated assessment of what it would cost to do the remaining work on the property.
So far as income is concerned, she claims in her May affidavit to earn about $5 per month in interest on her deposits. She otherwise claims to have no income at all. She earns nothing in rent from the three investment properties she owns and is allowing them to go to ruin. She is instead steadily working her way through the cash deposits which she received from the deceased.
I am highly sceptical about all of the defendant's evidence about financial matters. I find that the evidence which she has given about her monthly expenditure, set out in her May affidavit, is totally unreliable.
Nonetheless, I am satisfied that she at least owns the three properties and that they probably have the values which I identified at [103] above. She also seems currently to have cash of about $625,000 and has superannuation of approximately $200,000.
I can believe she has earned only $5 per month since the deceased died, but I do not accept that this is all she could have earned in that period. A moment's reflection would reveal that she could have brought the properties up to the point of being able to be rented, she could have been earning rental income on at least two and probably three properties (she is "mostly staying" with Brian Traylen), as well as earning a healthy rate of interest on what would still have been a significant fund of cash. Instead, she has done nothing with the properties but has used up about $250,000 of the cash she had as at mid-2022, all the while earning virtually no interest whatsoever on the balance.
The plaintiffs submitted that the defendant was a totally unreliable witness and that I would not accept anything she said to be true unless corroborated by other evidence. For the reasons explained in the preceding paragraphs, I accept that submission.

[18]

Applicable law

The plaintiffs seek orders for provision under s 59 of the Act. There is no dispute that each plaintiff is an eligible person within the meaning of s 57.
Section 59 relevantly provides: "(1) The Court may, on application under Division 1, make a family provision order in relation to the estate of a deceased person, if the Court is satisfied that - (a) the person in whose favour the order is to be made is an eligible person, and … (c) at the time when the Court is considering the application, adequate provision for the proper maintenance, education or advancement in life of the person in whose favour the order is to be made has not been made by the will of the deceased person, or by the operation of the intestacy rules in relation to the estate of the deceased person, or both. (2) The Court may make such order for provision out of the estate of the deceased person as the Court thinks ought to be made for the maintenance, education or advancement in life of the eligible person, having regard to the facts known to the Court at the time the order is made."
Section 60 identifies a large range of matters to which the Court may have regard for the purpose of determining whether to make a family provision order and the nature of any such order.
The principles governing the exercise of the Court's powers determining whether to make a family provision order and the nature of any such order are not in doubt. They were helpfully collected and explained by Meek J in Tarbes v Taleb [2023] NSWSC 565 at [195]-[222].
In the case of adult children, it is appropriate to recognise that the relationship between parent and child changes as the child attains adulthood. However, it has been held that "a child does not cease to be a natural recipient of parental ties, affection or support, as the bonds of childhood are relaxed": Jodell v Woods [2017] NSWSC 143 at [104(a)]. In that case, Hallen J also said: "It is impossible to describe, in terms of universal application, the moral obligation, or community expectation, of a parent in respect of an adult child. It can be said that, "ordinarily, the community expects parents to raise and educate their children to the very best of their ability while they remain children; probably to assist them with a tertiary education, where that is feasible; where funds allow, to provide them with a start in life, such as a deposit on a home, although it might well take a different form. The community does not expect a parent, in ordinary circumstances, to provide an unencumbered house, or to set his, or her, child up in a position where she or he can acquire a house unencumbered, although in a particular case, where assets permit and the relationship between the parties is such as to justify it, there might be such an obligation": Taylor v Farrugia, at [57]; McGrath v Eves [2005] NSWSC 1006; Kohari v Snow [2013] NSWSC 452 at [121]; Salmon v Osmond [2015] NSWCA 42 at [109]."
One of the defendant's submissions in these proceedings is that the plaintiffs have not demonstrated that they have financial needs that would justify the amount of provision they are seeking. In that regard, I especially note what Basten JA said in Chan v Chan [2016] NSWCA 222 at [22] (Simpson and Payne JJA agreeing): "A significant set of factors in many cases is that identified as "the financial resources (including earning capacity) and financial needs, both present and future, of the applicant...". However, it is important not to elide the distinction between needs and adequate provision; the former is but one indicator of the latter. The adequacy of provision is not to be determined by a calculation of financial needs. The background to any consideration of the appellant's needs require[s] determination of the size of the estate and the claims of others on the beneficence of the testator."
In this regard, see also Strang v Steiner [2019] NSWCA 143 at [71] (Macfarlan JA).
I also note what his Honour said in that same case at [72] and [73], and the authorities to which he there referred, as to the consideration that is to be given to the deceased's testamentary wishes.

[20]

The estrangement

The defendant submitted that the deceased had been thwarted in his attempts to maintain a close relationship with his children, both by Mrs Baumanis and by the children themselves. She submitted that Mrs Baumanis turned the children against the deceased and interfered with their attempts to communicate with him. She said that the deceased had for many years maintained his attempts to stay close to his children but that the children had not reciprocated. She said that the children themselves had said hurtful things to the deceased and that these things had stayed with the deceased up until the time of his death. She submitted that the children (aged in their pre-teens and early teens at the time) were to some degree responsible for severing the moral and family ties with their father, through things they said and the way they behaved.
The defendant particularly pointed to the content of a "diary" created by the deceased. This document was an obviously self-serving diary created for the purpose of bolstering the deceased's position in property settlement negotiations. It contains a number of remarkably petulant and immature observations about the failure of his children to show affection towards him. For example, in the weeks and months immediately following his unilateral departure from the home, he recorded exactly when he texted Jacinta and Nikolai (aged about 14 and 12 at the time) and how long it took them to respond.
The defendant's case in this regard was about as thin as could be. One diary entry related to a visit the deceased made to the family home in October 2014 when Nikolai was 12. It is apparent from the diary entry that there was a lot of tension between the deceased and Mrs Baumanis at this point. The deceased apparently had his sister, Anita, with him as a "witness". The visit was unannounced and the purpose was for the deceased to retrieve a boat. The diary entry records: "Nik came out of the house but he avoided me and did not speak except a hi to Anita who made a point of trying to engage him in conversation." It was suggested to Nikolai on the basis of this diary entry that he had failed to sufficiently acknowledge his father. Nikolai had no recollection of the incident.
Jacinta was cross examined about her apparent failure, at age 15 or 16, to respond to an email from the deceased. The email in question was sent by the deceased to thank Jacinta and Nikolai for sending him a birthday card. There was no evidence that she had failed to respond; there was only evidence that Nikolai had responded.
On the basis of evidence such as this, it was submitted that the Court was not really in a position to attribute blame for the estrangement that existed between the deceased and his children.
I reject this aspect of the defendant's case in its entirety. The evidence shows that the deceased did not make serious efforts to maintain a close relationship with his children after leaving the home. He was generally petulant and uncooperative in his communications with Mrs Baumanis about questions of access to the children, as his diary shows. He paid no more in child support than he was strictly required to pay. He refused to contribute towards private school fees, even though he had previously agreed that the children would attend private school. He went so far as to call Dustin's school to determine the date of his final school exam so as to ensure that he did not pay anything more than was strictly necessary. He made desultory efforts to contact them at Christmas time until 2016. For her part, Mrs Baumanis attempted to keep the lines of communication open by sending Christmas cards to the deceased's family but the deceased instructed his solicitor to demand that she cease this practice.
As to Mrs Baumanis's role in all of this, I reject the suggestion that she turned her children against their father in any respect whatsoever. The evidence demonstrates the opposite. The children were of course aware of their parents' breakup and some of them may also have had a general understanding of the property settlement dispute in which their parents became embroiled. Why should they not? But Mrs Baumanis behaved entirely appropriately by not exposing her children to those difficulties any more than was necessary.
As to the children's role in all of this, I need to say two things. First, it is a matter of real regret that the defendant has taken the stance she has done on this issue in this litigation. It is true that the Court has a wide discretion in dealing with applications for provision and that it is necessary to take a fairly broad survey of the overall relationship between the deceased and the plaintiff in order to reach a conclusion as to whether to make an order under s 59 and, if so, the amount to be awarded. But there are limits. The defendant's case in this regard amounted a series of petty-minded assertions about the children's role in the estrangement from their father. The airing of these matters was of no assistance to the Court whatsoever. It was also needlessly hurtful to the children and to their mother. In this respect, the conduct of the defendant brings to mind the disapprobation, in similar circumstances, made clear by Meek J in Tarbes v Taleb at [75].
The second thing to say is that although the children were estranged from their father, they never ceased to see him as their father. Despite all that has occurred they did not develop significant negative attitudes towards him. They all had close and loving relationships with their father until the moment he abandoned them. Nikolai and Jacinta, who were cross examined, exhibited a high level of maturity in their attitude towards the deceased. Neither they nor their siblings are in any way whatsoever to blame for their circumstances. I entirely reject the defendant's contention that blame for the estrangement can to any degree be attributed to any of the plaintiffs.
It is nevertheless necessary to deal with the fact of the estrangement. In cases where there has been an estrangement between the plaintiff and the deceased, it is appropriate to consider (as far as such a thing can be done) the causes of the estrangement: Underwood v Gaudron [2014] NSWSC 1055 at [230]-[233].
In Ford v Simes [2009] NSWCA 351, Bergin CJ in Eq (with whom Tobias JA and Handley AJA agreed) said: "It is one thing to make provision for a child, even an adult, where the Court is able to better balance the obligations of the testator with the adequacy of the provision made by the testator. However in my view it is very important for the maintenance of the integrity of the process in these types of applications that this Court acknowledge once again the entitlement of testators, in certain circumstances, to make no provision for children: The Pontifical Society for the Propagation of the Faith and Saint Charles Seminary, Perth v Scales [1962] HCA 19; (1961) 107 CLR 9. This is particularly so in respect of children who treat their parents callously, by withholding without proper justification, their support and love from them in their declining years. Even more so where that callousness is compounded by hostility."
That was a case in which the plaintiff had unilaterally estranged himself from his father, the deceased. Her Honour noted: "The deceased spent the last 14 years of his life without any assistance from the appellant; without any communication (except the abusive encounter) from the appellant; and without the benefit of the love from a child whom he had nurtured and financially assisted during his formative years."
The defendant points out that it is necessary to have regard to the whole of the relationship. She draws particular attention to the fact that, according to the defendant, the deceased did not wish to see his children as he was dying. She points to the "Personal Instructions/Information" document to which I referred at [46] above. All of this, so it is submitted, demonstrates that there was an estrangement that "should restrain amplitude" in any provision for the children.
There is no doubt that there was an estrangement of sorts that existed as at the time of the deceased's death, and I will take that fact into account. But its causes were clear: the deceased unilaterally abdicated his responsibility as a father. I am unable to discern the least trace of mutuality so far as the causes for the estrangement were concerned. The children remained, in their own way, loving children to their father despite his dereliction. They were all confused and upset by his decision to leave the home and by his failure to maintain relationships with them over the years.
I am cautious about couching my conclusions about the application of s 59 in terms of the deceased's moral duty to provide for his children (see Steinmetz v Shannon [2019] NSWCA 114 at [44] and [109]). Nonetheless, so far as this particular aspect of the dispute is concerned and without intending this to be a statement of my overall conclusion, I consider that the deceased's moral duty to provide for his children was essentially undimmed by the estrangement.

[21]

The defendant's financial position and the deceased's testamentary intention

The defendant initially submitted that the plaintiffs should receive nothing more than a nominal legacy. She submitted that her own claim, and the deceased's testamentary intentions, were significant considerations and that when regard is had to the effect that provision orders for the plaintiffs would have on her financial circumstances, the Court would only make nominal provision for them. She submitted: "If provision is made for any or all of the plaintiffs, and their costs paid on the ordinary basis, Taylor's financial resources will be significantly depleted. In circumstances where it was the joint intention of the deceased and Taylor that their savings would be used to fund their living expenses and ultimately their retirement, that is an outcome that the Court should be slow to embrace."
It is entirely appropriate to consider the effect of any order for provision on the defendant. That is especially so in circumstances where she is the widow of the deceased: see Steinmetz v Shannon at [98]-[109], although I note the repeated emphasis in that judgment that observations as to the primacy of a widow's claim are "guidelines" (see [37] and [106]). It is also appropriate to consider the deceased's testamentary intentions. But these matters must be understood in their proper factual context. I make several observations in that respect.
First, any order for provision will obviously affect the defendant, but not in her capacity as residuary beneficiary. Rather, the effect of making provision out of notional estate will be to (partially) deny her the fruits of the transactions which she entered into just before the deceased died. As I have found, those transactions were specifically intended by the deceased to ensure that his property did not fall into his estate in the first place.
Secondly, I am also entitled to take into account the defendant's own conduct in dealing with the plaintiffs, including in these proceedings (see s 60(n) of the Succession Act). In that respect, she has behaved quite improperly. She failed to inform the plaintiffs that their father was dying, or that he had died. She has not sought probate and has taken no steps to investigate the assets of the estate. She entered into transactions with the deceased on the eve of his death that are explicable only by a desire to thwart the very family provision claims now before me. She avoided service. She has sworn false and misleading evidence, as I have described at [124] and [127] above.
Thirdly, the deceased's estate is small but his notional estate is significant. The properties alone have an estimated combined value of just over $2,000,000. The defendant has already received a large amount of cash from the deceased. The orders I propose to make will leave the defendant with more than adequate provision.
In my view, it is appropriate to take all of these circumstances into account. They substantially reduce the weight I am prepared to give to the fact that provision for these plaintiffs will, in practical terms, come at her expense. They also substantially reduce the weight I am prepared to give to the deceased's testamentary intentions.

[23]

Corey

The defendant did not object to Mrs Baumanis's evidence as to Corey's disabilities. Nor was Mrs Baumanis cross-examined about that evidence. Corey, who is entirely wheelchair bound, was present in Court for some of the proceedings.
In written submissions, the defendant made the extraordinary submission that Corey is only "said to" suffer from the conditions I have described and that there is "no evidence before the Court to support that he suffers from such medical conditions." Those submissions were repeated orally, after Corey's presence in Court.
I reject those submissions. There was ample evidence of all of those matters. That evidence was not objected to, nor was Mrs Baumanis cross-examined about it. The defendant led no evidence on this matter. These submissions should not have been made.
The defendant next submitted that all of Corey's needs were taken care of by the NDIS and that "there is not anything in his life that cannot adequately be dealt with by recourse to his own resources."
The defendant referred me to Maria Oliveira by her tutor Ivo De Oliveira v John Antonio Oliveira [2023] NSWSC 1130 (Oliveira), a case in which Kunc J dismissed an application for provision for contingencies brought by a severely disabled adult child in full time care. His Honour held that all of the contingencies that were likely (or even those that might possibly) befall the plaintiff would be taken care of from other sources such as the NDIS, and that there was therefore no occasion to make further provision under the Succession Act.
However, I note that there was also evidence in that case that the plaintiff's two brothers would make provision for her, should she have needs over and above those met by the NDIS: see Oliveira at [15(3)].
I would be very slow to treat the reasons of Kunc J in Oliveira as stating a general or settled position as to whether and, if so, how much provision should be made in the case of a person with severe mental and physical disabilities and whose needs are largely being met by the NDIS. That is certainly not how his Honour's reasons are expressed.
I also note that there are cases in which provision has been made for plaintiffs in relevantly similar circumstances to Corey (that is, those in receipt of NDIS packages): Vella v Vella; Vella v Vella [2020] NSWSC 849 at [164]-[190] and Aveyard v Selwood; Philpott v Selwood; Riley v Selwood [2024] NSWSC 29, especially at [176].
The authors of Family Provision in Australia (5th ed, 2017, LexisNexis) point out that, until the late 1940s, there was a common view that if a person under an intellectual disability was confined in an institution run by the state, he or she had no special needs and that applications by such persons were frequently refused on the footing that the provision would benefit the state, not them: see [4.52]. That view, however, no longer prevails. In Re Duff (1948) 48 SR (NSW) 510, it was held that it may be appropriate to refuse an order where the plaintiff receives no "benefit" from the order. However, where a plaintiff does receive a benefit it may be appropriate to make an order even if a substantial effect of it is to relieve the State of the cost of maintaining him or her.
The references in these older authorities to whether the plaintiff will "benefit" from provision are difficult to reconcile with some of the language of Part 3.2 of the Succession Act. There does not appear to be any requirement that a plaintiff must "benefit" from an order for provision in the sense that he or she will subjectively enjoy and appreciate any provision. To the contrary, many of the matters that may be taken into account in determining a plaintiff's entitlement to provision include matters that seem to have nothing at all to do with subjective appreciation, such as the plaintiff's financial circumstances, the existence of illness and disability, and any liability of another person to provide for the plaintiff. It is difficult to discern from the language of s 60 or any other provision a clear indication that a plaintiff's subjective inability to appreciate his or her financial (or other) circumstances is of any particular significance. The fact that physical and mental disabilities may be taken into account, together with the fact that a parent has habitually provided care for such a person, strongly suggest that a plaintiff's inability to comprehend the benefit that is associated with financial provision should not weigh heavily in the analysis.
In the present case, the evidence shows that Corey is able to appreciate his circumstances and that he would appreciate and benefit from provision. He lives in the community with his family, who love and care for him. He has relationships with his family members. He had a relationship with his father and was upset when he left. He is not insensible. He also has financial needs that are not met by the NDIS. He quite urgently needs a new wheelchair-accessible van.
So far as contingencies are concerned, Corey is not in the position of the plaintiff Maria in Oliveira who had the benefit of assurances that she would be looked after by her siblings. I have no doubt that Corey's siblings would take every effort to look after him, should they be called upon to do so, but that is no different than what they would do for each other. None of them is (or as a result of these proceedings will be) in a position to ensure his maintenance and welfare should Mrs Baumanis cease to be his primary carer.
The most significant contingency facing Corey is the prospect of losing his mother as his primary carer, even for a relatively short period. That is a contingency which, should it occur, would almost certainly present financial and social challenges that simply could not be met by the NDIS. If it were to occur, Corey would not be able to continue to live in the community without paying for replacement care, which he cannot afford.
In this respect, I should add that the defendant failed to engage, at all, with Corey's case. His immediate need is for a van that is adapted to his disabilities, and unchallenged evidence suggested the cost of that van would be about $100,000. The defendant's submission that a "modest sum for contingencies", of between $75,000 and $100,000, was adequate provision for Corey is divorced from reality. The truth is that such a "modest sum" would immediately be used to purchase the (vitally necessary) van, leaving no sum at all for any actual "contingency". For these reasons, the defendant's submissions on adequate provision for Corey must be rejected.

[27]

Conclusions as to the amount of provision

The foregoing discussion of the defendant's principal submissions allows me to state my conclusions as to the amount of provision for each plaintiff fairly easily. I have found that there was an estrangement, but that the plaintiffs were not to any material degree responsible for it. They were children when the deceased left them. None of them has been shown to have behaved towards the deceased in such a way as to diminish the deceased's moral duty towards them. I have also found that the defendant's own claims on the notional estate do not overbear those of the plaintiffs. The defendant will be adequately provided for even if I accept the plaintiffs' submissions in their entirety. This is so even taking into account her numerous medical issues.
I am unable to accept the proposition that the plaintiffs are seeking provision in excess of their demonstrated financial need. As I pointed out at [143], the question for determination is whether the deceased made adequate provision, not simply whether the plaintiffs' immediate financial needs have been met.
Jacinta, Nikolai and Dustin are young adults facing the usual costs and expenses associated with housing and education. There is no doubt that the deceased should have made some provision for the plaintiffs in his will. Even the defendant now accepts this to be the case. The circumstances that have led the plaintiffs to instead receive nothing reflect poorly on both the deceased and the defendant. Given the size of the notional estate of the deceased, it is appropriate for each of them to have an amount to cover tertiary education expenses and then to have a fund for contingencies. I do not accept that, in reaching a conclusion about the size of that fund for each plaintiff, I should be quite so restrained as the defendant suggests.
So far as Corey is concerned, I consider he is in a far stronger position so far as provision is concerned. Unlike his sister and brothers, Corey has absolutely no ability to deal with those vicissitudes of life not covered by the NDIS. He is totally dependent on his mother. As I have explained, the major contingency in his life that will not be covered by the NDIS is the cost of obtaining alternative care in the event that his mother is unable to continue to care for him. The other contingency that could reasonably arise is some alteration to the level of care which the NDIS is prepared to fund.
Ms Hartstein, who appeared for the plaintiffs, submitted that it would be appropriate to make provision for Corey in the range of $500,000 to $550,000. This figure reflects the cost of a new vehicle, a portion of the cost of a carer to take the place of his mother in the future (calculated on the cost of an extra carer for two years) and a small sum for other contingencies.
I consider that in all the circumstances the deceased's obligation was to make provision for Corey in the sum of $550,000. This will cover the cost of a new vehicle and will leave a contingency fund that is only a fraction of the costs he will face in the event that his mother ceases to be his full-time carer. I further consider that this provision should be paid in stages. As to $100,000, provision should be paid within 28 days of the making of orders from the deceased's notional estate in the defendant's Westpac bank account. This is to cover the cost of a new van. The balance will be paid out of the proceeds of the sale of properties in due course, which is a matter I will turn to shortly.
As for the other plaintiffs, I accept their submissions on this issue. It is appropriate to make orders for provision for Jacinta and Dustin in the sum of $180,000. It is appropriate to make an order for provision for Nikolai in the sum of $190,000. This is marginally higher than the sum proposed for Jacinta and Dustin, reflecting the fact that he has a HELP debt and that his overall education costs are likely to be higher.

[29]

Division 3 of Part 3.3

It is next necessary to consider the terms of Division 3 of Part 3.3 of the Succession Act. That division is entitled "Restrictions and Protections Relating to Notional Estate Orders" and it sets out a series of matters that must be considered, and matters about which the Court must be satisfied, before making a notional estate order.
Section 87 provides: "The Court must not make a notional estate order unless it has considered the following - (a) the importance of not interfering with reasonable expectations in relation to property, (b) the substantial justice and merits involved in making or refusing to make the order, (c) any other matter it considers relevant in the circumstances."
I note that there is some debate as to whether section 87(a) requires me to consider the expectations of the deceased, the defendant or both of them: Phillips v James [2014] NSWCA 4 at [105]. I will proceed cautiously and consider the expectations of both of them, although I note that the Court of Appeal in Phillips v James suggested at [125] that the only person whose expectations must be considered is the "present holder of an interest in the property".
So far as the deceased's expectations are concerned, there are two matters to note. The first is that the deceased obviously expected that the transfer of the properties to the defendant would take effect according to its terms. He also no doubt expected that, on his death, the defendant would hold the whole of the properties by right of survivorship. He also expected that she would receive any cash, either because it was in joint accounts or because he gave it to her or because he nominated her as beneficiary for superannuation.
At the same time, he clearly also had an expectation that each of these outcomes would defeat the family provision claim I am now considering. All of the property dealings with which I am concerned (both in relation to real property and cash) have been coloured by the deceased's desire to ensure that his children would not benefit from his estate. In these circumstances, I do not consider that the deceased's expectations in relation to his property ought stand in the way of the plaintiffs' claims.
As to the defendant, she acquired her interests in the properties as part of a stratagem to deprive the children of their ability to make a claim against the estate. This was done at no cost whatsoever to her but at significant cost (including duty and income tax) to the deceased, which further depleted the estate, quite unnecessarily so given the generous duty and tax concessions available as of right to those who inherit property by will. The defendant knew she had acquired the properties for, essentially, nothing. She also knew that the children were to receive nothing under the will. Knowing all of this, she went along with the deceased's plan to hide the true facts (including even the fact of their father's death) from the children. She even told the deceased's sister, Anita, whom she knew still to be in contact with the plaintiffs' family, that provision had been made for them in the will, which was all but a lie.
No doubt the defendant has an expectation that her interest in the three properties should not now be disturbed in order to meet the children's claims for provision, but in all of the circumstances I do not find that her expectation in that regard should stand in the way of a notional estate order.
Furthermore and for the same reasons, the substantial justice and merits of the matter justify the making of a notional estate order. This is the very kind of case to which the provisions of Part 3.3 were directed.
Next, s 88 provides that the Court must not make a notional estate order unless it is satisfied that: "(a) the deceased person left no estate, or (b) the deceased person's estate is insufficient for the making of the family provision order, or any order as to costs, that the Court is of the opinion should be made, or (c) provision should not be made wholly out of the deceased person's estate because there are other persons entitled to apply for family provision orders or because there are special circumstances."
As I have noted, I am not able to reach a firm conclusion as to the value of the deceased's estate based on the evidence before me. Nonetheless, I am satisfied that the deceased's estate is not sufficient to meet any one of the orders for provision I propose to make, much less all of them.
Section 89 is as follows: "(1) In determining what property should be designated as notional estate of a deceased person, the Court must have regard to the following - (a) the value and nature of any property - (i) the subject of a relevant property transaction, or (ii) the subject of a distribution from the estate of the deceased person or from the estate of a deceased transferee, or (iii) held by the legal representative of the estate of any deceased transferee in his or her capacity as legal representative of the estate of the deceased transferee, (b) the value and nature of any consideration given in a relevant property transaction, (c) any changes in the value of property of the same nature as the property referred to in paragraph (a), or the consideration referred to in paragraph (b), in the time since the relevant property transaction was entered into, the distribution was made, the property became held by the legal representative of the estate of the deceased transferee or the consideration was given, (d) whether property of the same nature as the property referred to in paragraph (a), or the consideration referred to in paragraph (b), could have been used to obtain income in the time since the relevant property transaction was entered into, the distribution was made, the property became held by the legal representative of the estate of the deceased transferee or the consideration was given, (e) any other matter it considers relevant in the circumstances. (2) The Court must not designate as notional estate property that exceeds that necessary, in the Court's opinion, to allow the provision that should be made, or, if the Court makes an order that costs be paid from the notional estate under section 99, to allow costs to be paid as ordered, or both. (3) If, as a result of a relevant property transaction or of a distribution from the estate of a deceased person or from the estate of a deceased transferee, property becomes held by a person as a trustee only, the Court must not designate as notional estate any property held by the person other than the property held by the person as a trustee as a consequence of any such relevant property transaction or distribution."
So far as the requirements of subsection (1) are concerned, I have already mentioned the context in which the relevant property transactions occurred. In relation to the deceased's real property, the transactions were specifically intended to have the effect that the property would pass to the defendant without forming part of the estate. The deceased derived no financial benefit from the transfers. To the contrary, they involved considerable costs that could have been avoided if he had instead left the properties to the defendant in his will.
In relation to the deceased's cash, there are two things to note. First is the fact that the deceased executed a binding death benefit nomination in favour of the defendant, again ensuring that property would not fall into the estate. I do not however place significant weight on that fact, at least not in isolation. There are usually good reasons for executing such nominations, because they can significantly simplify the process of receiving superannuation death benefits. Second is the fact that a considerable portion of the cash obtained by the defendant from the deceased's accounts (or their joint accounts) was transferred in the final days of the deceased's life and shortly thereafter. The defendant offered no explanation for why this occurred. The likely explanation is that the defendant (and the deceased, if he was conscious at relevant times) wished to put the cash beyond the reach of the estate.
None of the relevant transfers yielded any consideration for the deceased. Paragraphs (c) and (d) therefore do not appear to require any further consideration.
So far as subsection (2) is concerned, I am required to ensure that the amount of property designated as notional estate does not exceed that which is "necessary" to "allow the provision that should be made", as well as costs. I was informed that the plaintiffs' costs were approximately $140,000 as at 23 May. The total amount of provision I propose to order is $1,100,000. Of that amount, I propose to make a notional estate order in relation to the Westpac account but only as to the sum of $100,000 for the purpose of meeting part of Corey's provision. In my opinion, that need is sufficiently urgent and obvious that it should be paid immediately from available cash.
However, it is not possible for all of the plaintiffs' provision to be paid from cash, nor in my view would it be appropriate to do so, because it would unnecessarily constrain the defendant. The defendant claims to be unable to work to service a mortgage and has proved to be an extremely poor property manager. If she is left with nothing but realty, she will probably struggle to cope financially.
I am conscious that whichever combination of properties is sold, the gross sale proceeds are likely to exceed the sum necessary for provision and costs. One option would be to make a notional estate order in relation to a single property, such as the Ashtonfield property, with the balance of provision to come from the bank accounts. However, that course runs the real risk of leaving the defendant with insufficient cash to live on. I would also not be prepared to make an order in those terms without securing the bank deposits until such time as the net proceeds of sale were known, which would unnecessarily constrain the defendant financially.
As to which properties should be designated as notional estate, the defendant submitted that I should only make a notional estate order in respect of the Victoria Street and Lee Street properties. She submitted that the Ashtonfield property was her main residence and that I should not interfere with it.
I am unable to accept that submission. There are several points to note in this regard.
The first is that I am not confident that the sale of the Victoria Street and Lee Street properties would realise a sufficient sum to meet the provision orders I propose to make once selling costs and the costs of these proceedings are taken into account.
The second point is that I do not accept that the Ashtonfield residence is the defendant's main residence. It was not her residence in mid-2022, as the death certificate shows. Also, on 25 March 2024, the defendant's counsel informed me from the bar table that the reason his client had not entered an appearance in the proceedings earlier was that the documents had been served at the Ashtonfield property but that this was not her residence. The defendant has also stated that she barely ever visited the property in the second half of 2023. This means that even on her own case she has not lived there for almost a year.
The Ashtonfield property is not secure. It has been in this condition for many months. On any view, the defendant was not living there at the time of the hearing and this is not about to change.
The third point is that, of the properties, the Victoria Street property seems to be the least renovated. The Ashtonfield property and the Lee Street property seem to be in a better state of repair and so should, all other things being equal, be less likely to sell at a discount.
Because all options available to me involve the designation of realty as notional estate, it is not possible for provision to be met except by the realisation of assets that have a greater value than the amount of provision that is to be paid, plus costs. Nonetheless, I am satisfied that it is necessary to make notional estate orders in relation to the Ashtonfield and Lee Street properties to allow the provision which I propose for the plaintiffs to be made.
In the circumstances, I will make a notional estate order in relation to each of the Ashtonfield and Lee Street properties. I will also make a notional estate order as to the sum of $100,000 in the Westpac account for the purpose of satisfying part of the order for provision in favour of Corey.

[30]

How is the notional estate to be realised?

As to the means by which the notional estate is to be realised, I need again to step back into the procedural history of the matter.
Prior to the first date fixed for the final hearing of this matter, I invited the plaintiff to address me on the appropriate steps to take in circumstances where: there was no appearance for the defendant; where there was a will but where probate had not been granted; and where any provision would need to come out of notional estate. I took the view that it would be appropriate in these somewhat unusual circumstances to grant administration in respect of the estate to the NSW Trustee & Guardian pursuant to s 91 of the Succession Act, for the purpose only of permitting the application to be dealt with. I do not suggest that such an order is appropriate for every case where probate has not been granted. It will often be appropriate to grant administration to the plaintiff. I note, in this respect, what Young J said about the utility of such orders in Re Estate Harriett Cassel [2000] NSWSC 294 at [10]; see also Georgopoulos v Tsiokanis [2022] NSWSC 563 (Hallen J).
That grant is, as specified in s 91, limited to administration for the purpose of permitting the application to be dealt with. The question of whether this extends to the steps required to bring in and realise notional estate for the purposes of giving effect to final orders for provision was not argued before me, but there must at least be some doubt about whether it does so.
In these circumstances, I will instead proceed by reference to s 75 of the Probate and Administration Act 1898: "(1) In any case where the executor named in a will - (a) neglects or refuses to prove the same or to renounce probate thereof within three months from the death of the testator or from the time of such executor attaining the age of eighteen years, or … the Court may upon the application of - (i) any person interested in the estate, or (ii) the NSW Trustee or a trustee company, or (iii) any creditor of the testator, order that probate of the said will be granted to such executor or order that administration with such will annexed be granted to the applicant or make such other order for the administration of the estate as appears just."
The appropriate course is to appoint an administrator for the purposes of realising the notional estate and meeting the orders for provision which I have made. I will invite the plaintiffs to bring in short minutes nominating an administrator with the appropriate indications of consent, either being the NSW Trustee & Guardian or an independent solicitor.

[33]

Orders

The orders of the Court will be as follows: 1. Order that the properties known as and situate at XX Lee St, Maitland and XX Ballydoyle Drive, Ashtonfield be designated as notional estate of the late William John Baumanis pursuant to s 78 of the Succession Act 2006 (NSW) to the extent required for the satisfaction of Orders (3)(b), (4), (5), (6) and (9) herein; 2. Order that funds standing to the credit of the defendant in the defendant's bank account at Westpac be designated as notional estate of the late William John Baumanis pursuant to s 78 of the Succession Act 2006 (NSW) to the extent of $100,000 for the purpose of satisfying Order (3)(a) herein; 3. Order that provision be made for the maintenance, education and advancement in life of Corey John Baumanis, in relation to the notional estate of the late William John Baumanis, by way of a legacy in the sum of $550,000, such legacy to be paid: 1. $100,000, on or before 28 days from the entry of these orders, to be paid to Corey personally; and 2. $450,000, to be paid to a Special Disability Trust for Corey's benefit; 1. Order that provision be made for the maintenance, education and advancement in life of Jacinta Hope Baumanis, in relation to the notional estate of the late William John Baumanis, by way of a legacy in the sum of $180,000; 2. Order that provision be made for the maintenance, education and advancement in life of Nikolai Albert Baumanis, in relation to the notional estate of the late William John Baumanis, by way of a legacy in the sum of $190,000; and 3. Order that provision be made for the maintenance, education and advancement in life of Dustin William Baumanis, in relation to the notional estate of the late William John Baumanis, by way of a legacy in the sum of $180,000; 4. Order that the legacies in Orders (3)(b), (4), (5) and (6) herein be paid within 28 days of the realisation of the notional estate and bear interest at the rate prescribed by s 84A of the Probate and Administration Act 1898 (NSW) from that date until paid; 5. Order that the plaintiffs bring in short minutes of order nominating an administrator to realise the notional estate outlined in these orders within 14 days of the entry of these orders; 6. Order that plaintiffs' costs on the ordinary basis as agreed or assessed be paid out of the notional estate of the late William John Baumanis; 7. Direct that any application for a variation of the costs order in Order (9) above be made by email to the Associate to Justice Hmelnitsky within 14 days of the entry of these orders; and 8. Grant liberty to apply.

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