Burge v Burge

Factual Background

1. Mr Rupert Webb Burge died on 5 January 2013, aged 93. He was survived by his widow Anne, son Conrad and daughter Susanne. Without conveying any disrespect, I will refer to those individuals by their Christian names.
2. Most of the deceased's estate comprised money in two offshore bank accounts. He had also been a joint tenant with Anne of a town house in Scottsdale, near Phoenix in Arizona, which passed to her on his death.
3. The deceased had enjoyed a successful career as a statistician in the United States before returning to Australia in 1960 to become a merchant banker. He and his family lived in Mosman in Sydney. He joined the firm of Patrick Partners in 1970, in which he invested a substantial amount of his savings. The deceased suffered a significant financial setback when that firm failed a few years later. At that time, his wife sold two investment units in Neutral Bay to fund the construction of a yacht, known as the "Pacific Belle", which was ready to sail by 1981. For around the next 20 years, the deceased and Anne spent much of their time sailing around the world on the Pacific Belle. In 1983 they visited their family, in Melbourne, when the will which was admitted to probate was drafted.
4. The 1983 will was drafted by solicitors in Toorak in Victoria. In this will, the deceased appointed Anne to be sole executrix and trustee and left his entire estate to her. In the event that his wife predeceased him or died within one month of his death, the will appointed Conrad and Susanne as executors and trustees and left his estate to them in equal shares. That will was dated 15 March 1983, signed by the deceased, and witnessed by a solicitor and a secretary in Melbourne. It was posted, by certified mail, on 21 March 1983 to Conrad, then living in Braddon in the Australian Capital Territory. As will be seen below, the deceased retained the envelope for the remainder of his life.
5. Anne applied for a grant of probate in solemn form. She drew to the attention of the court the existence of two documents signed by the deceased after the 1983 will. The first was a letter in the hand of the deceased bearing three dates: 5 October 1994, 24 November 1999 and 14 December 1999 (the 1994/1999 letter). The primary judge found that on 5 October 1994, the deceased wrote a first draft of the letter, in the following terms: "Dear Anne, DISPOSITION OF FAMILY ASSETS Please excuse the blunt (necessarily so) examination of my family resources. At some $US X million, plus boat and miscellaneous personal assets, in the well organised and liquid state achieved offering income - assured by bonds, etc - above $2 thousand per week, you are evidently comfortably set up. Conrad and Susanne are already in their "40s": whilst your good health promises that you will live into a happy and sturdy old age, it seems most rational and fair in these circumstances to give the two offspring some access to my final resources promptly in the event of my unfortunate early demise - should this occur. THEREFORE: Will you please arrange in the event of my death, using your "Power of Attorney" to distribute all of my legal assets held by BNP Geneva as follows: 33.3% thereof to yourself, and the same proportion to Conrad, and to Susanne, but both the children are asked to hold this capital ready to assist your future position, should this prove necessary during your lifetime! With my love, Rupert W Burge".
6. In around mid-1999, the deceased suffered a heart attack. He had by-pass surgery in early 2000. The primary judge found that he made some handwritten additions and amendments to the letter in late 1999 as follows: (1) he wrote "2.5" above "$US X million", and initialled the change; (2) he wrote "4" above "$2 thousand", crossed out the "2", and initialled the change; (3) he crossed out the word "some" where it appeared before the words "access to my financial resources" and initialled the change; and (4) he made various changes (each of which was initialled) to the final paragraph of the letter so that it henceforth read: "THEREFORE: I have arranged, prior to my death to distribute all of my assets held by BNP Geneva as follows: 50 per cent thereof to Conrad; and 50% to Susanne, but both children are asked to hold this capital ready to assist your future position, should this prove necessary during your lifetime!"
7. Anne gave evidence that her husband had neither given her the letter nor told her of it. The primary judge accepted her evidence. Plainly enough, the deceased retained possession of it until his death.
8. Both the 1983 will and the 1994/1999 letter were kept by the deceased in the same place, in the "W" divider in a small cardboard accordion file which was found in a bookcase in the flat in Dee Why where the deceased and his wife lived until his death in January 2013. The 1994/1999 letter was kept in an envelope from an Arizona resort and golf club, which was addressed to Anne at Susanne's address in Arizona. On the envelope was written: "Addendum to will attached hereto". The deceased signed below this statement and recorded the date as 14 December 1999.
9. At one stage, it was suggested that the 1994/1999 letter had testamentary effect, but that claim was abandoned and formed no part of the appeal.
10. The 1983 will was kept within the original envelope bearing the 21 March 1983 postmark from Toorak. That envelope (which is now more than 30 years old) bears a number of handwritten annotations in different pens. First, in black and red capitals is the word "WILLS". Secondly, in blue pen are the words: "Latest Will remains 1983 will enclosed 1 June 1994 R W Burge".
11. Thirdly, in black pen is the date 14 December 1999, and some words which are partly illegible, but which appear to include: "Transfer of assets to Conrad and Susanne has not been effected".
12. Also contained in the 1983 envelope was a will made by the deceased in the 1960s. That will was not in evidence before the primary judge, and secondary evidence of it did not establish whether it had been attested.
13. The second document to which Anne drew attention in her application for probate was not found in the envelope with the other two. A copy of the unexecuted will prepared in 1983 for the deceased had been amended, signed and dated by him in 2007 (the 2007 document). This document is central to this appeal. It is necessary to provide some context to the execution of the 2007 document.
14. In around 2003, when the deceased was 83 and his wife 80, the pair ceased to sail the Pacific Belle. The boat was left in Florida for two or three years, until it was transported first to Phoenix, then Seattle, then Vancouver, before being shipped to Brisbane in 2009. In late 2005 or early 2006, when the boat was in Phoenix, arrangements were made for Susanne to oversee certain repairs to it. For reasons that are unclear, her doing so became a source of tension between Susanne and her father. A letter found on the hard drive of his computer, dated 10 May 2007, but which was never sent, suggested that he remained very upset with his daughter more than a year later.
15. In 2004, the deceased and his wife purchased a townhouse in Scottsdale, Arizona, where they lived before returning to Sydney in 2011. He and his wife moved to a small unit in the same building in Dee Why in which Conrad and his family lived. They remained there until the deceased's death in 2013, where the 1983 will, the 1994/1999 letter and the 2007 document were found.
16. I return to the 2007 document. The deceased made handwritten changes to clauses 2, 4 and 6, dated the will 10 June 2007 and signed it in the attestation clause. He also filled in that date on the backsheet (something which had not been filled in on the 1983 will).
17. As amended, the deceased's wife continued to be his sole executrix and trustee. The change to clause 2 meant that if she predeceased him, then Conrad became the sole executor and trustee; in other words, Susanne was no longer a potential executor and trustee. That change was initialled by the deceased.
18. In clause 4, the deceased struck out Anne as the principal beneficiary, and replaced her name with Conrad's, again initialling the change. There were no other changes to the clause in the event that his son failed to survive the testator's death.
19. The whole of clause 6, which had to do with the guardianship of any infant children, was struck out. This was not initialled.
20. Page 4 of the will was the attestation clause. It was in the following terms: "IN WITNESS WHEREOF I have hereunto set my hand to this and the preceding pages of this my Will this 10 day of June two thousand and seven. SIGNED by the said RUPERT M BURGE as and for his last Will and Testament in the presence of us both present at the same time who in his presence at his request and in the site and presence of each other have hereunto subscribed our names as attesting witnesses:-". Underneath that clause were spaces for both witnesses to sign. They were left blank.
21. The 2007 document was found separately from the other documents referred to above. There was a contest at trial as to precisely how this occurred, but the primary judge accepted the evidence of Susanne, which was to the effect that after finding the other documents, she again searched the bookshelf and also looked behind the desk. When she pulled the desk out, she found another cardboard accordion file, sitting in a space within the desk but behind a desk drawer. She said that the 2007 document was within the accordion file, together with some other pieces of paper. She was unsure whether it was inside an envelope. Neither the accordion file, nor any of the other contents, nor any envelope, was adduced into evidence.

The Primary Judge's Decision

1. Section 8 of the Act is in the following terms: "8 When may the Court dispense with the requirements for execution, alteration or revocation of wills? (1) This section applies to a document, or part of a document, that: (a) purports to state the testamentary intentions of a deceased person, and (b) has not been executed in accordance with this Part. (2) The document, or part of the document, forms: (a) the deceased person's will - if the Court is satisfied that the person intended it to form his or her will, or (b) an alteration to the deceased person's will - if the Court is satisfied that the person intended it to form an alteration to his or her will, or (c) a full or partial revocation of the deceased person's will - if the Court is satisfied that the person intended it to be a full or partial revocation of his or her will. (3) In making a decision under subsection (2), the Court may, in addition to the document or part, have regard to: (a) any evidence relating to the manner in which the document or part was executed, and (b) any evidence of the testamentary intentions of the deceased person, including evidence of statements made by the deceased person. (4) Subsection (3) does not limit the matters that the Court may have regard to in making a decision under subsection (2). (5) This section applies to a document whether it came into existence within or outside the State."
2. It was at all times common ground that the requirements of s 8(1) were satisfied. The sole question at trial, and on appeal, turns on s 8(2)(a): whether the court was satisfied that Mr Burge intended the 2007 document to form his will. It was common ground, and in accordance with what had been said in Hatsatouris v Hatsatouris [2001] NSWCA 408 at [56], that the question is one of fact.
3. The primary judge analysed the position with some care: Burge v Burge [2014] NSWSC 1772 at [52]-[65]. His Honour observed that the form and content of the 2007 document provided considerable support for the view that the deceased intended it to form his will, having regard to its being signed, being dated, and being based upon a draft of a professionally prepared will. His Honour also observed that most of the changes were signed or at least initialled by the deceased. However, his Honour noted that there were some considerations which tended against the inference that the document had been given close attention. One was that the opening sentence of the document included an address that was many years out of date. Another was that the signature of the deceased was placed next to an attestation clause that clearly referred to signing in the presence of two witnesses.
4. His Honour inferred that, by reason of "having previously executed two formal wills", the deceased was aware of the need for two attesting witnesses: at [55]. The only challenge made by the appellant to any finding of fact was his Honour's reference to two formal wills. It was common ground on appeal that the evidence before the primary judge did not sustain a conclusion that the 1960s will had been validly executed and attested. Even so, the error was immaterial, because the 1983 will was validly executed, and, even more importantly, the signature on the 2007 document was placed immediately adjacent to the attestation clause and above the two spaces for the witnesses to sign.
5. The primary judge considered whether the 1994/1999 letter could bear upon the intention of the deceased in 2007. His Honour observed that although the letter was described as "an addendum to will", that did not support the conclusion that the deceased thought that the letter itself operated as a will or an amendment to the will.
6. In [57]-[62], his Honour elaborated upon the matters which ultimately proved to be decisive. His Honour concluded that it was unlikely that the deceased would have considered the 2007 document, signed but unattested, was itself capable of operating as a valid will. His Honour also relied upon the fact that the 2007 document was not kept in the envelope marked "WILLS", nor with that envelope and the 1994/1999 letter in the accordion file on the bookshelf. His Honour recognised that the deceased had retained the 2007 document and brought it with him to Australia in 2011, but observed that the deceased also retained documents in his possession that had no continuing importance. For example, the deceased retained the 1960s will until his death, not to mention the copy of the unexecuted 1983 will which had been retained for 24 years before being amended and executed by the deceased.
7. His Honour referred to the dispute between the deceased and Susanne about repairs to the Pacific Belle, the fact that he considered Anne's position to be financially secure, and that the deceased was aware that Conrad had experienced serious health issues, and had two young children. His Honour accepted that those considerations could provide a rationale for the making of a will in the terms of the 2007 document. Against this, the evidence was that the deceased's marriage with his wife was a happy one, shown for example by an affectionate letter written to her on their 60th wedding anniversary in December 2008.
8. His Honour had regard to the fact that the 2007 document, or the possibility of a will to that effect, was not mentioned to anyone. However, his Honour observed that the evidence was that the deceased was a very private man. His Honour regarded those considerations as neutral.
9. His Honour then concluded at [63]-[65]: "63. Whatever the merits or strength of the rationale for a will in the terms of the 2007 document, there is no doubt that Rupert Burge contemplated the making of such a will. That much is demonstrated by his actions in bringing the 2007 document into existence. The critical question, however, is whether Rupert Burge intended that document to form his will. 64. I regard this as a borderline case. Ultimately, having considered the totality of the evidence and the various matters raised by the parties in submissions, I am not satisfied that Rupert Burge intended the 2007 document to form his will. First, for the reasons given earlier, I consider it unlikely that Rupert Burge, being aware of the need for two attesting witnesses, would have considered that the 2007 document was itself capable of operating as a valid will. Secondly, had Rupert Burge intended the 2007 document to operate as his will, it is likely that he would have placed it with the 1983 will and the other documents in the envelope marked "WILLS". Thirdly, even if he considered his wife to be financially comfortable, it would be a big step to entirely disinherit her, without explanation. 65. As explained earlier, the form and content of the 2007 document provides considerable support for the view that Rupert Burge intended it to form his will. However, I am unable to accept the defendant's submission that it is inconceivable that Rupert Burge would have carefully amended the draft 1983 will, and then initialled, dated and signed the document, unless he intended it to be his will. When considered in the light of all relevant circumstances, including the three matters referred to in the preceding paragraph, I am not persuaded that Rupert Burge had that intention. To paraphrase the words of Mahoney JA in Masters (supra) at 462, whilst the 2007 document on its face contemplates legal effect, there are circumstances that lead to the contrary conclusion, namely, that the document was not intended to have present operation as a will. Rupert Burge plainly contemplated making a will in terms of the 2007 document but I am not satisfied on the evidence that he went so far as to intend that the document actually form, and therefore operate as, his will, including by revoking any previous will."

Leave to Appeal

1. As a preliminary point, the respondent submitted that the grant of probate only vested title in the executrix of movables located within New South Wales, excluding the foreign bank accounts maintained by the deceased. She submitted that leave was required pursuant to s 101(2)(r) of the Supreme Court Act 1970 (NSW) because, putting to one side those bank accounts, the estate was worth merely $23,580.
2. There are at least two reasons for rejecting this submission. The first is that, as White J said in Weinstock v Sarnat [2005] NSWSC 744 at [24], by taking out probate, the executrix accepted the trusts in the will in respect of the whole of the property subject to those trusts, "even though part of the personal estate is not within the jurisdiction of the Court of Probate and more is required in order to vest title in the executor". That is sufficient to cause this appeal "directly or indirectly" to involve a "claim, demand or question to or respecting" property to the value of $100,000 or more. Secondly, there is no reason to think that a United States or Swiss court would not highly likely follow the Australian grant of probate to the executrix. There is no evidence of foreign law, but, in a case such as this, it is presumed that the foreign law is the same as Australian law: see Murakami v Wiryadi [2010] NSWCA 7; 218 ALR 377 at [78]. Accordingly, it was for the executrix, who maintained that leave was required, to displace that presumption. Moreover, each of the United States and Swiss bank accounts contained in excess of $100,000, so it was sufficient if just one of those countries' legal systems was likely to recognise the Australian grant.
3. The 2007 document was executed when the deceased was resident in Phoenix, Arizona. The Hague Convention of 1961 on the Conflict of Laws Relating to the Form of Testamentary Disposition is implemented by Pt 2.4 of the Act, which includes s 48. No submission was made that s 48 applied because the 2007 document's unwitnessed execution "conforms to the internal law in force in" Arizona. Once again, in the absence of evidence to the contrary, it is to be presumed that Arizona law requires a will to be witnessed, such that s 48 does not apply.

The Appeal: principal grounds

1. It was common ground that the appeal was to be approached in accordance with Costa v Public Trustee of NSW [2008] NSWCA 223. It will not be necessary in the present appeal to consider the varying emphases in the three judgments delivered in Costa. It suffices to say that this Court will draw for itself the appropriate inference as to the intention of the deceased, after giving weight to the opinion of the primary judge, especially to the extent to which it was based on an amount of oral evidence. In the present case, the material evidence was predominantly documentary.
2. At the forefront of the appellant's challenge to the conclusion of the primary judge was an attack on each of the three considerations identified in [64] of his reasons, reproduced above. This was the gravamen of grounds four and five of the appeal. I follow the order adopted in the appellant's oral address, and deal with each consideration in [64] in reverse order.
3. First, the appellant submitted that the primary judge's consideration of the unlikelihood that the deceased would "entirely disinherit" his wife "without explanation" was irrelevant. On one view, if the 2007 document were held to be an informal will, the deceased had not "entirely" disinherited his wife; in order to do so, it would be necessary to sever the joint tenancy of their property in Scottsdale, Arizona. However, the focus of the appellant's submissions was that the primary judge's conclusion disregarded freedom of testamentary capacity: the deceased was free to dispose of his estate in the manner of his choosing. It was also submitted that in fact there was an explanation for taking such a course, mainly the fact that the couple had split the proceeds of the sale of their Mosman house leaving Anne relatively well provided for financially, in contrast with Conrad, as borne out in some of the documents in evidence.
4. There is potential for ambiguity in the words "without explanation". In my view, when the primary judge referred to disinheritance "without explanation", his Honour was referring to the finding made at [61] that the deceased "certainly never mentioned the 2007 document (or the possibility of a will to that effect) to anyone". In other words, his Honour was referring to the unlikelihood of an uncommunicated explanation. My view is strengthened by the fact that in [62] and [63], his Honour had in terms accepted that there was a rationale for a testamentary disposition in accordance with the 2007 document.
5. The widow of the deceased gave evidence that: "I do not remember Rupert specifically talking about his will or his testamentary intentions. I always assumed that he would leave his assets to me. He never indicated to me that he had any other intentions."
6. In the circumstances, relatively little weight attaches to the third consideration. (I note that although the appellant's oral submissions commenced with it, this was the third of three matters relied on by the primary judge at [64].) However, it is not entirely without force. It would be improbable for the deceased to appoint his widow as his executrix, but to give all of his assets - including physical items in their possession such as books, rings and items of sentimental attachment - to Conrad without telling her of that fact. It does not seem to accord with the expected behaviour of the deceased as the loving husband of sixty years disclosed by the evidence.
7. Secondly, the appellant's attack upon the significance of the location of the 2007 document turned upon the absence of additional materials, namely, the envelope (if there was one), the other documents found with it, and the smaller accordion cardboard folder in which these documents were located. Without those documents, according to the appellant, inferences could not safely be drawn from the fact that the document was located apart from the other wills. It was said that it was "just as plausible that the deceased stored the 2007 document separately from the 1983 will and the 1960s will because those documents were no longer operative and had been superseded by the 2007 document".
8. I do not agree, for a series of reasons. The 1983 document was not stored by itself. It was stored with what on any view was a superseded document: the 1960s will. It was also stored in the same "W" divider of the accordion file as the 1994/1999 letter. That is where, on the evidence, all of the deceased's testamentary documents were found - save for the 2007 document. Moreover, all those documents were more readily found, on a bookshelf near the desk of the deceased. There was nothing to indicate that those documents had been superseded by the 2007 document, even though the deceased had positively written, "Latest Will remains 1983 will enclosed". The significance of the location of the 2007 document turns upon the seemingly ordered and organised approach to documents disclosed by the evidence.
9. Thirdly, in respect of the failure to attest the 2007 document, the appellant acknowledged that it was a relevant consideration, but submitted that it was not determinative. That much may be accepted. Ultimately, the question at first instance was whether, upon an examination of the whole of the evidence, the court was satisfied that the 2007 document was intended by the deceased to form his will.
10. In many, perhaps most, cases, the signing and dating of a formal will will lead to a court being satisfied that the person intended the document to form his or her will. This case is highly unusual. It is unusual because the deceased appears to have had a practice of signing documents, and keeping them, knowing that they were of no legal effect. The deceased kept a handwritten letter, signed and dated in 1994, for five years. He amended that letter, twice, five years later, and kept it, although at no time did he send it to his wife. The deceased was in the habit of initialling changes to documents and signing and dating envelopes.
11. It would have been easy for the 2007 document to be stored with the other "wills" in the "W" divider of the accordion file on the bookshelf. It would have been easy for the deceased to have struck out the attestation clause in the 2007 document. It would also have been easy for the deceased to have crossed out, or destroyed, the 1983 will, or to have crossed out the annotation on the envelope in which it was stored: "Latest Will remains 1983 will enclosed". All those matters accorded with the impression gained of a highly educated and sophisticated testator, who meticulously preserved, initialled and dated all manner of documents. That in turn enhances the significance of the first and second matters on which the primary judge relied.

Remaining Grounds

1. The remaining grounds of appeal may be addressed more concisely. Ground seven was to the effect that, having determined that this was a "borderline case", his Honour ought properly to have taken into account the remedial purpose of the Act and, for that reason, found that the deceased had intended the 2007 document to form his will. I disagree.
2. Undoubtedly, s 8 of the Act has a remedial purpose, which is well illustrated by the judgment in In the Estate of Masters (decd) (1994) 33 NSWLR 446, both in its summary of the legislative history, and also in what Mahoney JA said (dissenting, but not on this point) at 462 as to the predecessor of s 8, being "given a beneficial application" because there were "many cases in which the intention of the deceased has not been able to be given effect", this being "an evil which should be remedied as far as may be". However, as the respondent submitted, the beneficial or remedial purpose does not produce the result that in every finely balanced case, the plaintiff who propounds an informal testamentary document must succeed. The primary judge expressly had regard to the beneficial application to which Mahoney JA had referred (at [9]). His Honour expressly had regard to the ordinary force to be accorded to the fact that the 2007 document was self-evidently testamentary, signed and dated. But those matters are not determinative. As Mahoney JA recognised at 462, effect should "ordinarily" be given to that fact, unless "there are contexts or circumstances that lead to the contrary conclusion".
3. No error is shown by the candid recognition by the primary judge that this was a "borderline case". His Honour correctly applied the Act, recognising its beneficial and remedial purpose, to circumstances where, unusually, there were powerful contextual matters pointing in the other direction.
4. Ground three focussed upon the formulation of the third element of the test arising under s 8 (and its predecessor, s 18A of the Wills, Probate and Administration Act 1898 (NSW)) in Hatsatouris v Hatsatouris at [56]: "Did the evidence satisfy the Court that, either, at the time of the subject document being brought into being, or, at some later time, the relevant Deceased by some act or words, demonstrated that it was her, or his, then intention that the subject document should, without more on her, or his, part operate as her, or his, Will?" (Original emphasis).
5. The short answer to this ground is that nothing in the reasoning of the primary judge suggests that any material weight was given to the emphasised words. The emphasis in his Honour's judgment recorded, accurately, the emphasis given by Powell JA in Hatsatouris v Hatsatouris. Indeed, the appellant's written submissions were to the effect that, "given the fact that his Honour did not elaborate on what he understood by the words 'without more', it appears that he was deflected from a consideration as to whether the 2007 document itself operated as the deceased's will and focused on peripheral matters" (paragraph 17, written submissions dated 10 August 2015). To the contrary, the reasons of the primary judge merely reproduce an unexceptionable formulation of principle and, with respect correctly, proceed to examine the entirety of the evidence bearing upon the issue raised by s 8(2)(a) of the Act.
6. Ground six was not pressed. Grounds one and two were directed to the ultimate question, and were not separately addressed.

Conclusion and Orders

1. The reason this is a borderline case is that in many if not most cases where the deceased has signed and dated a professionally prepared will, the conclusion will readily be drawn that the document was intended by the deceased to form his or her will. It is the unusual circumstances of this case - including the preservation of earlier wills and of signed correspondence which was never sent, coupled with the fact that the deceased failed to include the 2007 document with the 1983 will and other testamentary documents - that, considered together, detract from the inference which ordinarily would be drawn. Not only has no error been shown in the evaluation of that evidence by the primary judge, but I would, having regard to all the evidence, draw the same conclusion: I am not satisfied that the deceased intended the 2007 document to form his will.
2. I propose that the appeal be dismissed. The primary judge gave a separate judgment as to costs: Burge v Burge (No 2) [2015] NSWSC 141. I would direct the parties supply, within 14 days, any agreed orders as to costs, failing which each should supply orders they propose, together with submissions not exceeding five pages in support of those orders.

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: 24 September 2015