Bouttell v Rapisarda

The relationship between Ms Bouttell and the deceased 17Ms Bouttell met the deceased in 2001. They were both then living at Teal Close in Green Point. James and Laura were living with Ms Bouttell. The deceased shared the care of Luke and Dylan with Ms Keegan. 18According to Ms Bouttell, whose evidence generally I accept, the relationship between her and the deceased developed quickly. In about August 2001, the deceased and his sons moved in to live with Ms Bouttell. At that stage, the deceased's property settlement was unresolved but was, as it were, being processed. He shared the care of his children with Ms Keegan. Ms Bouttell looked after her children full time, because their father had returned to (or stayed in) the United Kingdom. 19In September 2001, Ms Bouttell and the deceased rented a larger property at Terrigal. They moved there and lived as a blended family for about a year. 20At the time, both Ms Bouttell and the deceased were working. 21Once the property settlement between the deceased and Ms Keegan was finalised, the deceased bought the property at Stephen Close. It appears to be common ground that the proceeds of the property settlement were used as a deposit and that the balance was borrowed, in the name of the deceased, from a bank. It appears to be common ground also that the deceased made all repayments under that mortgage. 22Finally, since it was mentioned in the evidence (although, like much mentioned in the evidence, it is of at best marginal relevance), it appears to be common ground that the deceased expended substantial amounts of money in improving the Stephen Close property. 23The relationship continued, although with some difficulties, until about October 2005. Ms Bouttell then left the deceased and moved back to Teal Close, although in a property near her own property in that street (her own property was then rented out). 24For some four years, Ms Bouttell and the deceased effectively conducted a relationship from their separate homes. That tended to work by them seeing each other when the deceased's sons were staying with their mother. However, in 2009, Ms Bouttell ended the relationship. Thereafter, she and the deceased remained separate for some two years, until 2011. 25Ms Bouttell met the deceased while she was at a conference in Sydney, in early March 2011. The meeting rekindled their relationship. Ms Bouttell said, and I accept, that within a very short time, thereafter, the deceased proposed marriage to her and she accepted his proposal. 26Mr Lakeman suggested that the engagement had not been finalised until much later in the year (and after the deceased had been diagnosed with his terminal illness). The evidence on this is somewhat contradictory. However, as I have said, I do accept the substance of Ms Bouttell's evidence. She said that although they had decided in about March or shortly thereafter 2011 to marry, they kept silent about this for some months. 27In support of Ms Bouttell's contention that the engagement had been agreed before the deceased was diagnosed with his terminal illness, there was tendered a receipt for what is said to be (and I find was) a substantial deposit on an engagement ring. The date of that receipt is 6 November 2011. The significance of that date is that it was not until five days later that the deceased, Ms Bouttell, and other members of the deceased's family learnt that he was suffering from what proved to be a terminal illness. 28Thus, notwithstanding that the engagement does not appear to have been announced to the deceased's family until some time after 11 November 2011, I find (as I have indicated) that the engagement was agreed some months earlier and solemnised (if that be the correct term) by the purchase of an engagement ring on about 6 November 2011. 29Ms Bouttell gives reasons as to why they delayed the announcement of the engagement. Those reasons seem to me to be convincing and I accept them. 30The deceased was diagnosed with terminal abdominal cancer on 11 November 2011. Ms Bouttell says that he asked her whether she still wanted to marry him and she said, "Of course I did." They decided to marry on 7 April 2012, which was between chemotherapy cycles. That happened. 31The deceased intended to make a will in about December 2011. A draft will has been put into evidence. It is substantially the same as the will ultimately made on 14 July 2012, except that, in addition to the provision for Ms Bouttell which the executed will makes, there was to be a legacy in her favour of $150,000. Ms Bouttell said, and it appears to be logical, that the intention of the legacy was to enable her to discharge the mortgage over her property at Teal Close. If that were to happen of course she could enjoy the income of that property without the need to make repayments to the bank. 32However, the deceased did not proceed to make that will. The reason appears to be that he received a letter from Ms Keegan which made it clear that Ms Keegan was hoping for him to continue his financial support for Luke and, in particular, Dylan. As a result, and after discussions between the deceased and Ms Bouttell, the deceased gave instructions for the will that was in fact executed and which has now been admitted to probate. 33Ms Bouttell says, and I accept, that as the deceased's health deteriorated, she took leave (including annual leave, sick leave, and long service leave) to enable her to attend to the deceased. 34As I have said, the deceased died on 15 September 2012. 35Although the marriage was one of short duration, it was a marriage following a relationship of substantially longer duration, although that relationship was punctuated by the two year gap to which I have referred.

Ms Bouttell's financial position at the present time 36Ms Bouttell is employed by an entity in the IAG/NRMA Group. She works as a business consultant at the Gosford branch. She says that her hours are about 32 hours per week with occasional overtime and that her base salary is $31,000 per annum. On her evidence, which on this point was not challenged in cross-examination, her gross earnings are consumed almost entirely, if not absolutely, by her everyday living expenses. I mention that because at one stage it was suggested by Mr Lakeman that Ms Bouttell could obtain a mortgage to assist her to buy alternative accommodation. If her income position, and her expenses, are as stated (and I repeat that this aspect of her evidence was not challenged), it would be a foolhardy mortgagee that would advance money in the belief that she could repay it out of her income. 37At the date of death of the deceased, Ms Bouttell had owned her property at Teal Close. It was encumbered by a mortgage. That property was rented out, through a firm of real estate agents, at about $330 per week. Ms Bouttell decided to sell the property. The sale price was $390,000. After the discharge of the mortgage, that left about $215,000 net. $15,000 of that sum was used by Ms Bouttell to pay out a loan that she had undertaken to buy a car. 38The balance, $200,000, is invested in an interest bearing account. Obviously enough, Ms Bouttell needs to pay tax on the interest that is earned. 39Although Mr Lakeman challenged the reasons for selling the Teal Close property, I do not find that it was unreasonable of Ms Bouttell to do so. She said that she had a shortfall between the expenses relating to the property and the income that it generated. The executor carried out what he said were (or what purported to be) calculations intended to demonstrate that this aspect of Ms Bouttell's evidence was incorrect. I do not agree. 40First, the executor appeared to assume that the letting agent would provide its services free of charge. There is no evidence of any such magnanimity. 41Secondly, the calculations assumed that the mortgage was interest only. Ms Bouttell said that it was not. Her evidence on that point is corroborated by the fact that she was able to redraw on the mortgage: something which could not happen with an interest only mortgage. 42Thirdly, the executor's calculations appeared to assume that the property would require no expenditure by way of repairs and maintenance. If there were such investment properties available, I am sure that intending vendors would be rushed off their feet by willing purchasers. The assumption is clearly unrealistic. 43In the result, Ms Bouttell's assets at present are the bank deposit (now about $202,000), a car, and some personal possessions. In addition, she has the benefit of superannuation from her employer. The balance standing to the credit of that account is apparently $73,000. Of course, if Ms Bouttell continues to work (and she said that she hopes to do so until age 67 or 70), that balance will increase. 44Ms Bouttell's only liabilities are for the costs of this litigation. 45Mr Lakeman criticised Ms Bouttell for various expenditures that she had undertaken. One was for an operation apparently intended to reduce her weight. Mr Lakeman characterised that as cosmetic surgery. The effect may have been cosmetic. However, Ms Bouttell said (and her evidence on this point again was not challenged) that she was medically obese with very high blood pressure, and had a family history of stroke. In the circumstances, it seems to me, any attempt to classify the operation as one undertaken purely for cosmetic purposes ignores the medical reality. 46Mr Lakeman also criticised Ms Bouttell for undertaking holidays, including one in Bali and one, for in excess of five months, in the United Kingdom. 47The latter was undertaken to enable Ms Bouttell to see her mother (who is old and infirm) and her sister. The former was undertaken before Luke started his HSC exams. In the circumstances that had existed in 2011 and 2012, it is I think scarcely surprising that Ms Bouttell wished to have some relief from the situation of which she received daily reminders at the Stephen Close property. 48I do not regard either of those trips as representing some extravagant, foolish or reckless expenditure.

The competing submissions 49To some extent, I have mentioned and dealt with points made by Mr Lakeman. 50The primary position taken by Mr Lakeman was, appropriately, that the executor's duty was to seek to uphold the will. However, Mr Lakeman accepted, entirely properly, the reality that it was probable that the Court would find that Ms Bouttell had been left with insufficient provision for her maintenance in life. 51Mr Lakeman submitted however that if the Court were to come to that conclusion, her proper claim on the estate could be met by a legacy of a relatively small amount. He submitted that the legacy should be by way of a percentage share (relatively modest) in the estate rather than by way of a lump sum. 52Mr Lakeman referred to the brief duration of the marriage and the competing claims of Luke and Dylan. As to the latter, he contrasted the meagre resources of those two young men with what he said was the relatively comfortable position of Ms Bouttell. Mr Lakeman stressed that Ms Bouttell appeared to be in good health, that she had received substantial education and training, and that she had a secure job which she enjoyed. 53As I have said, Mr Lakeman criticised the decision to sell the Teal Close property. For the reasons I have given, I do not accept his criticisms. 54Mr Lakeman was on surer ground when he criticised the absence of any evidence, before the commencement of the hearing, as to what it was that Ms Bouttell actually wanted from the estate. 55Ms Bouttell's affidavit evidence gave no inkling of what she needed further provision to achieve. In pre-hearing submissions put for her, Mr Quickenden of counsel had submitted that a legacy of $375,000 would be appropriate, to assist her to buy her own residence. However, there was no affidavit evidence in support of this proposal. 56The only evidence came (by leave, and over Mr Lakeman's objection) in examination in chief. At that point, Ms Bouttell said that she had started to look for possible places to buy. She said that she would only want a two bedroom, or perhaps a one bedroom, property. She produced two real estate advertisements, one offering a property at East Gosford for "above $450K" and the other offering "off the plan" a property at Terrigal for "$430K". 57Mr Lakeman submitted, with both force and justification, that the unsatisfactory way in which this evidence had been adduced made it impossible for the executor to undertake any assessment or to propound any evidence in reply. 58Further, Mr Lakeman pointed to the sale of Ms Bouttell's Teal Close property (I think, a three bedroom house) for $390,000. He submitted that it was likely that a smaller but nonetheless appropriate property would cost less. I agree. 59Mr Lakeman pointed to the need that Luke and Dylan had to complete their education, and for their support and maintenance while they did so. He pointed also to the fact that, were they to undertake tertiary study (as Luke is doing and Dylan hopes to do) they would incur HECS liabilities. 60Mr Lakeman stressed that the executor put no case of disentitling conduct. He did however criticise some aspects of Ms Bouttell's conduct. He referred, in particular, to her actions, after the death of the deceased, in purporting to use her power of attorney (which of course had lapsed) to withdraw money from the deceased's account. Although Ms Bouttell referred to that in her affidavit, and gave an accounting of it, it was, I accept, inappropriate for her to act as she had done. 61Mr Lakeman referred also to the prospect that Ms Bouttell might receive some inheritance from her mother's estate in due course. However, accepting that Ms Bouttell and her sister (who lives in England) are likely to be the beneficiaries, the evidence on the point is that the mother lives in a retirement village, that her residence is heavily encumbered, and that she has few if any other assets. 62Thus, whilst it might have been appropriate for Ms Bouttell to deal with this in her affidavit evidence, in the result, nothing turns on it. 63Mr Quickenden submitted that the emphasis on the very short duration of the marriage was misguided. He pointed out, correctly, that it had been preceded by the relationship to which I have referred. He submitted, and I accept, that the decision to marry had been made before Ms Bouttell and the deceased learnt of the deceased's terminal illness. He submitted, and again I accept, that when they decided to marry, they did so in the expectation of mutual support over many years. (As an aside, Ms Bouttell, who is shortly to turn 51, has an agreed statistical life expectancy of about 38 years.) 64Mr Quickenden stressed the context of the relationship, and the support that Ms Bouttell and the deceased had given each other over that time (of course, leaving aside the two year period of entire separation). 65Mr Quickenden submitted that the deceased owed a primary duty to Ms Bouttell, to ensure that she would have a residence free of additional cost or liability, so that she could enjoy the rental from her Teal Close property once the mortgage on that property had been paid off (in case it is not clear, the sale of that property did not occur until some time after the date of the deceased's death). 66Mr Quickenden referred to a great number of decisions in support of what he said was the obligation owed by the deceased to his widow. Those decisions arose in totally distinct factual situations. They laid down no relevant question of principle. I am reminded of the observations of Windeyer J in Teubner v Humble (1963) 108 CLR 491 at 503. His Honour deprecated the practice of citation of extracts from cases devoid of context, in support of propositions arising in totally different contexts: I should add that we were referred by counsel to a number of decisions in other cases of road accidents. But decisions on the facts of one case do not really aid the determination of another case. Observations made by judges in the course of deciding issues of fact ought not to be treated as laying down rules of law. Reports should not be ransacked and sentences apt to the facts of one case extracted from their context and treated as propositions of universal application... 67In my view, that criticism applies a fortiori in these days of computerised databases and their facility of searching. The Court is entitled to expect that when counsel cite cases, they will apply some thought both to the selection and to the citation.

Decision 68The application is made under s 59 of the Succession Act 2006 (NSW). The first question that arises is whether Ms Bouttell is an eligible person (see s 59(1)(a)). That takes one back to s 57(1)(a). It is clear that Ms Bouttell is an eligible person. 69The next question to consider is whether, at the time the application is considered by the court, it can be said that the will did not make adequate provision for the proper maintenance etc. of Ms Bouttell (s 59(1)(c)). For reasons I will give in a moment, I conclude (although it is not really controversial in this case) that the will failed to do so. 70The next matter to be considered is whether the application is made within time (s 58). It was. 71I return to the jurisdictional question posed by s 59(1)(c). 72The will seems to me to make it clear, objectively, that the deceased understood that he had some obligation to provide a residence for Ms Bouttell. Further, the will makes it clear (having regard to the circumstances existing when it was made) that the deceased formed this view acknowledging that Ms Bouttell had the benefit of ownership of the Teal Close property. 73Further, of course, and again viewed objectively, the will makes it clear that the deceased recognised an obligation to make provision for his sons Luke and Dylan. 74I do not think that anything turns on the draft will except to note that, had the deceased's estate been more ample, the provision that he would have made for Ms Bouttell might have been somewhat larger. 75To my mind, the deceased was correct to recognise the obligation to provide Ms Bouttell with a residence. However, I do not think that the right given by the will is sufficient. 76First, Ms Bouttell has no ownership interest in the property. She is dependent on others for its upkeep: for some time, the executor; and thereafter, Luke and Dylan. It may be that the executor would be able to meet his obligations of upkeep, although this would mean inevitably that he would have to delay distribution of the balance of the estate. However, there is no reason to think that Luke and Dylan would be able to do so. 77Further, quite apart from the ability of Luke and Dylan to provide for the upkeep of the property (when that obligation falls upon them), there is some question I think as to their willingness to do so. 78Secondly, and because Ms Bouttell does not have the benefit of an ownership interest in the property, she is not able to use it (for example) as security to enable her, should her financial position change, to acquire other assets on which she might rely for her support as she grows older. 79Thirdly, and as another result or consequence of the lack of an ownership interest, Ms Bouttell has no right to move to another, and it may be in the future more suitable, property. I do accept that it might be possible, by agreement between all parties concerned, for some substitute property to be bought. However, all that means is that Ms Bouttell's future residence rights must depend on the agreement of others and not on the exercise of her own volition. 80In short, I do not think that the arrangements made by the will in this respect give sufficient certainty and sufficient flexibility to Ms Bouttell to enable her to live in comfort and security for the rest of her life. 81It follows, in my view, that an appropriate provision under the will should have recognised the need for Ms Bouttell to buy another property. That leads to the next questions which are, given that in my view the jurisdictional factors set out in s 59(1) of the Succession Act have been satisfied, the question of whether an order should be made and, if it should, what that order should be. 82There was not advanced any case of some discretionary reason for refusing to make an order. Nor do I think that the evidence gives any basis for exercising the discretion not to do so, in circumstances where the jurisdictional questions have been answered in Ms Bouttell's favour. 83I turn to the question of what provision ought be made. 84In my view, that provision should be by way of legacy, in place of the rights given to Ms Bouttell by the will. 85Before I turn to the amount of the legacy, I should deal with some relatively peripheral matters. First, there are the moneys taken by Ms Bouttell from the deceased's account after his death. In theory, they are owing to the estate and would form part of the estate's assets. In my view, the provision that is to be made for her should be in effect in addition to those benefits that she has de facto, although not de jure, received. 86Secondly, the executor has made some provision, by way of advancement, for the benefit of Dylan. That provision appears to be of the order of about $20,000 in total. Again, that should not be disturbed by the further provision to be made in favour of Ms Bouttell. 87Thirdly, it appears to be common ground that the deceased made gifts of money to Ms Bouttell shortly prior to his death. She said, and I accept, that he did so to enable her to clear some debts. Those gifts might be thought to form part of the deceased's notional estate. The proper provision to be made for Ms Bouttell should leave those where they are: that is to say, should not require them to be taken into account. 88Fourthly, the specific bequests and legacies given by cl 12 of the will should not be disturbed. 89Turning to the question of the amount of the legacy: Ms Bouttell's wish is to have a legacy that will enable her to buy, without encumbrance, some alternative place to live. That it seems to me to be in principle appropriate. For the reasons I have given, I do not accept that it would be appropriate for Ms Bouttell to undertake a mortgage to assist her in the purchase of a property. However, she does have the benefit of a capital sum of $200,000, and it does not seem to me to be reasonable for her to say that she should receive a legacy of sufficient size to enable her to purchase a property without having to touch her own reserves. 90The next problem that arises is the one generated by the late and unsatisfactory nature of the evidence on the topic of cost. In circumstances where it was Ms Bouttell's obligation to prove this aspect of her case, but where her evidence on the point was late and unsatisfactory, I do not propose to make assumptions in her favour as to the amount required. 91To my mind, the surer guide comes from the recent sale price of her property at Teal Close. As I have said already, it seems to me that if a three bedroom property, apparently well located and otherwise "desirable", sells for $390,000, then a smaller and equally "desirable" property in the same area should sell for substantially less. Doing the best I can in the state of the evidence as it has been left, I think that an amount of about $350,000, together with stamp duty and costs, might be the sort of money needed to put Ms Bouttell into another house. 92However, I do not think that she should expect the estate to bear the whole of that cost. I do not think that it is unreasonable to expect her to contribute towards it. 93Thus, I conclude, the proper provision would be by way of a legacy in the sum of $300,000. If Ms Bouttell can acquire a property for that sum of money, then so be it. If the sum proved to be insufficient and she is required to spend some of her own savings, then again so be it. 94If I am right in my attempts to estimate the likely cost, provision in that amount would leave Ms Bouttell with still substantial savings against the exigencies of life. It would leave her with her constantly steady employment and income. And it would leave her with her constantly accumulating superannuation benefit. 95At the same time, on the figures as I have summarised them, provision in that sum would leave Luke and Dylan with about $150,000 each to support them in life, in particular while they complete their studies. It seems to me that redividing the estate in this manner gives proper expression to the three claims that the evidence discloses were ones for which it was proper for the deceased to provide; and it does so in a way which, although not entirely satisfactory (a function of the relatively meagre estate as much as anything), nonetheless gives appropriate recognition to the strength and merits of those claims. 96As I have said, Mr Lakeman contended for a legacy by way of a percentage share in the estate. That does not seem to me to be appropriate. If proper provision for Ms Bouttell is of the order that I have indicated, in all the circumstances, then to make provision by way of a share, the value of which can only be ascertained until after realisation of all the estate's assets, runs the very real risk of under-providing (or over-providing) for her needs. 97In short, on this point, I think that to the extent that the estate is insufficient or more than sufficient to meet the provision that I have indicated, Luke and Dylan should bear the burden or enjoy the consequences. 98It is obvious that some care will need to be given to the drafting of the orders. First, they must make it clear that the legacy that I conclude should be given in lieu of the provision made by the will is not to disturb the four matters that I have listed. Secondly, it will no doubt take some time to realise the estate's assets and thus there will be a question of the time from which interest should run. Thirdly, it may well be, those beneficially interested (Ms Bouttell, Luke and Dylan), all being of age and capable in law, may well direct the executor to proceed in a particular way, the effect of which would be to truncate the administration of the estate, for the benefit of all concerned (including, in particular, the executor). 99For those reasons, I direct the parties to bring in short minutes of order to give effect to what I have just said. 100That leaves the question of costs. On the face of things, the usual costs orders should follow: namely, that Ms Bouttell should have her costs on the ordinary basis out of the estate, and the executor his on the indemnity basis. If there is to be some dispute about that, I will hear argument. If not, those orders can be included in the draft. 101Finally, there are the exhibits. I have no wish to retain them. They should be handed out.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 28 August 2014