BURKE v PUBLIC TRUSTEE & ORS No. SCGRG-97-352 Judgment No. S6423 [1997] SASC 6423

Throughout the marriage and until he died, Burke had a problem with alcohol abuse. He died aged 52 years from symptoms caused by cirrhosis of the liver. He had been raised in an orphanage and believed that he had no relatives. According to the plaintiff, his upbringing had left him with a feeling of insecurity and low self esteem. He blamed a lot of his difficulties and problems in his life on his upbringing as an orphan. The marital relationship was difficult because of Burke's alcohol abuse. In 1978 Burke met another woman, who had also been brought up in an orphanage. Burke left the plaintiff and went to live with that woman. On 16 March 1982 the marriage was dissolved. The plaintiff and Burke had been married a little over 14 years and had cohabited for almost 11 years. There were no children of the marriage.

On the dissolution of the marriage, the plaintiff and Burke agreed on a property settlement. There are no documents evidencing the settlement. There is no order dividing the property. It appears that the plaintiff and Burke were able to agree a settlement and gave effect to it. The house property which she and Burke had occupied was transferred to her subject to a mortgage. The plaintiff had negotiated a mortgage to replace the existing mortgage. By that mortgage she raised an amount sufficient to acquire Burke's equity in the house. In addition, a motor car was transferred to her, but that was subject to an outstanding loan. For her part, the plaintiff paid Burke $10,000 for his equity in the house and he retained a motor vehicle, which was free of debt. Burke then had an entitlement to superannuation but the amount of that entitlement is not known. No regard was had to it in the property settlement.

Notwithstanding the separation and the dissolution of the marriage, the plaintiff maintained contact with Burke after he had left her. In 1985 the plaintiff was informed that the woman living with Burke had left him and that Burke was penniless and in financial difficulty. The plaintiff contacted Burke and offered to help him. From 1985 until his death on 7 May 1996 the plaintiff maintained regular contact with Burke by telephone and by visiting him.

In this period Burke's income as a forklift driver was not high. He received a wage of $320.00 net per week, out of which he paid $140.00 per week in rent. He found it difficult to pay accounts. The plaintiff lent him small amounts of money from time to time. Sometimes Burke would repay those loans but, as a general rule, he did not. Because of his alcohol abuse, Burke spent little money on food. The plaintiff regularly took food to him, including dishes he liked and groceries he liked. She would cook meals for him and place them in his refrigerator. On those occasions when she visited Burke, she would tidy his unit. She also assisted him in completing forms and helping him to arrange payment of his accounts. Through her employment at AGC, the plaintiff was able to assist Burke to obtain a loan to purchase a motor car. If Burke was sober, the plaintiff would spend some time with him. If he was not, she would simply leave him groceries, food, or whatever she had brought for him, and then leave.

The plaintiff believes that Burke had few friends or people who cared for him. She knows of a friend called Hilton Beddall, who visited him weekly. She believes that, apart from Beddall, she was the only person who visited or cared for him in the last twelve years of his life. She is confirmed in this view because, after Burke's death, she was the only person who looked after his funeral arrangements, cleaned up the flat, contacted Public Trustee to administer his estate and, with the authority of Public Trustee, distributed Burke's furniture and effects to the needy and contacted his creditors and utilities to inform them of his death.

The plaintiff was retrenched by AGC on 15 September 1993. At a later stage AGC re-employed her on a casual basis on a few days in each week. When Burke died, she was working three days in each week. Her income was approximately $200.00 per week. There have been recent occasions when AGC has employed the plaintiff on a full time basis. She does not expect that position to continue. She fears that the reality is that she will soon get no work at all. A number of the loans made to Burke by the plaintiff were made when the plaintiff was not fully employed. Burke knew that there were periods when she was not working full time.

The plaintiff has no qualifications other than her work experience and a certificate from a business college. She has not acquired any qualification to operate computers. She intends to undertake a course at a Technical & Further Education College to learn computer skills and seek to improve her qualifications for employment. At her age, and with her lack of qualifications, she will find it difficult to obtain full time work. She will have to rely on a Social Security pension for income in her retirement.

The plaintiff has three main assets. They are a house property at Parafield Gardens, the value of which the plaintiff estimates to be $79,000. It is unencumbered. She has a 1987 Commodore motor car, which she values at $8,000. She has an entitlement to a superannuation fund of approximately $70,000, but she is not permitted to have access to those funds until she is aged 55 years, except upon a significant penalty by way of income tax.

The deceased's mother and father predeceased him. There were no other children of the marriage of his parents. Public Trustee has made enquiries for the purpose of ascertaining whether Burke was survived by any next of kin. Those enquiries disclose that Burke's father had married twice. He and his first wife had four children but it seems that one may have died soon after birth. The other three children are Kevin William Burke born on 6 November 1911, William Francis Burke born on 4 November 1915 and Mary Claire Burke born on 17 July 1917. One of the brothers was married but he and his wife died before Burke. The first wife of Burke's father died before Burke. Burke's father remarried in 1943. Burke's mother and father both died in 1955. The court has appointed Mr B L Carpenter, a solicitor, to act on behalf of the next of kin. The half brother and half sister are entitled to share the estate on an intestacy: s72G of the Administration & Probate Act 1919. The plaintiff is the only person who applies under the Inheritance (Family Provision) Act.

In determining whether the court should make some provision out of Burke's estate, I have regard to the following:

1 The plaintiff has standing to make this claim as a person who has been divorced from Burke: s6(b) of the Inheritance (Family Provision) Act.

2 When determining whether an order should be made under s7of the Act, the court is required to carry out the two-stage process described in the reasons of the majority in Singer v Berghouse [No 2] [1994] HCA 40; (1994) 181 CLR 201 at 208-211. The first stage calls for determination of whether the plaintiff has been left without adequate provision for her proper maintenance, education and advancement in life. The second stage, which arises only if that determination be made in favour of the plaintiff, requires the court to decide what provision ought to be made out of the deceased's estate for the plaintiff: see Singer (supra) at 208-209. What is involved in each of those determinations was described in these terms in Singer at 209-210:

"The determination of the first stage in the two-stage process calls for an assessment of whether the provision (if any) made was inadequate for what, in all the circumstances, was the proper level of maintenance etc. appropriate for the applicant having regard, amongst other things, to the applicant's financial position, the size and nature of the deceased's estate, the totality of the relationship between the applicant and the deceased, and the relationship between the deceased and other persons who have legitimate claims upon his or her bounty."

3 In Singer (at 209) the majority appears to have deprecated the use of expressions such as "moral duty" and "moral obligation" on the language of s7. There is a difference of view whether the observations of the majority are binding as part of the ratio decidendi or were said obiter: compare Permanent Trust Co Ltd v Fraser (1995) 36 NSWLR 24, as explained in Massingham v Massingham (unreported judgment, Sup Ct NSW reference Court of Appeal No 40294/93 27 June 1996), with Grey v Harrison [1997] 2 VR 359. It is unnecessary in the circumstances of this case to enter into that debate. It may be, as Calloway JA observed in Grey v Harrison at 366, that the passage is intended only as a warning against departing too far from the language of the statute. The statute in New South Wales which was being considered in Singer, like s7(3) of the Inheritance (Family Provision) Act of this State, expressly authorises the court to have regard to the conduct of an applicant. Section 7(3) provides:

"The Court may refuse to make an order in favour of any person on the ground that his character or conduct is such as, in the opinion of the Court, to disentitle him to the benefit of this Act, or for any other reason that the Court thinks sufficient."

That provision indicates that there will be instances when an examination of "moral duty" and "moral obligation" will be required. At the end of the day, "moral duty" is not strictly a test but, instead, is "an element to be taken into account in weighing all considerations": per Dixon CJ in Pontifical Society for the Propagation of the Faith v Scales [1962] HCA 19; (1962) 107 CLR 9 at 20.

4 When determining what is "adequate" or "proper" it must be remembered that each is a relative term: Pontifical Society (supra) at 19. Their meaning and the relationship between them is explained in Bosch v Perpetual Trustee [1938] AC 463 at 476-477. "There are no fixed standards, and the court is left to form opinions upon the basis of its own general knowledge and experience of current social conditions and standards": Goodman v Windeyer [1980] HCA 31; (1980) 144 CLR 490 per Gibbs J at 502.

5 There are no hard and fast rules as to the attitude of the court to claims by divorced wives. Each case will be determined on its own facts, according to the merits of the claim: Re Cutts deceased [1969] VicRp 31; (1969) VR 254 at 258; Re Estate of Brooks (1979) 22 SASR 398, 399.

6 Factors relevant to a claim by a divorced wife include the culpability of the deceased in relation to the grounds of divorce, the length of time from the separation of the spouse to the death of the former husband, and the course which the lives of the two spouses have followed since separation: Re Adams [1967] VicRp 115; [1967] VR 881, 888; Re Estate of Brooks (supra) 400. The first of these factors still has some relevance in relation to the plaintiff's claim upon the bounty of the deceased, notwithstanding that it is obsolete in matrimonial law. However, the court should guard against indulging in the process of "evening up the score": Worladge v Doddridge [1957] HCA 45; (1957) 97 CLR 1; Re Estate of Brooks (supra) at 400.

7 A settlement upon the dissolution of the marriage is not a bar to the plaintiff's claim: Re Estate of Brooks (supra) at 403; Re Mayo deceased [1968] 2 NSWR 709 at 712; Dijkhuijs v Barclay (1988) 13 NSWLR 639, but the terms of the settlement are nevertheless relevant in determining the plaintiff's need and the extent to which it may have been satisfied in the deceased's lifetime. As Kirby P explained in Dijkhuijs v Barclay at 652, the public policy in finality of financial dealings by property settlement ordered by the Family Court must be read in conjunction with the competing public policy that, in certain circumstances, former spouses may seek orders for provision under the Act. Whether provision will be made and the nature of the provision will depend on the facts and circumstances of each case. So the divorce and any settlement of property lead the court to exercise "a carefully guarded discretion": Re Preece [1947] SAStRp 19; [1947] SASR 134; Re Estate of Brooks (supra) at 404.

8 Although it has been suggested that the most practical way to look at a claim for provision out of an intestate estate is to imagine the deceased had made a will by which he directed that his estate should be distributed as on an intestacy, and then to consider the needs and moral claims of the persons who benefit from a distribution in this manner: Re Russell [1970] QWN 22; Re Estate of Bridges (1975) 12 SASR 1, 5-6, that principle may not have a universal application. That approach will not be appropriate where there is no known living person with a claim upon the bounty of the deceased: Re Estate of Brooks (supra) at 400. It is, I think, doubtful whether it is appropriate where the only beneficiaries on an intestacy are a half brother and a half sister who are considerably older than the deceased and with whom, it seems, he had little, if any, contact. Distribution on an intestacy would in such circumstances produce an unexpected windfall to the next of kin. However, as I understand the reasons in Re Estate of Bridges at 5-6, a distribution on an intestacy is but the starting point and the question for the court is to what extent it should interfere with that distribution in order to make adequate provision for the proper maintenance, education and advancement of the plaintiff.

The answer to the first question, namely, whether the plaintiff has been left without adequate provision for her proper maintenance, education and advancement in life, is, I think, reasonably clear. The plaintiff was aged 47 years at the date of Burke's death. She had no other income other than what she earned as a clerk. It is unrealistic to expect that she would have been able to be employed as a clerk on a full-time basis. Already she has been retrenched and most of her working life since 1993 has been on a part-time basis. It is unlikely that, at her age, she will readily find employment, even if she retrains herself. Apart from her house and her motor car, which was over eight years old at Burke's death, the plaintiff's only asset is her entitlement to superannuation. However, it is quite unrealistic to expect that she is at present able to derive income from that source, as she cannot use that superannuation unless she incurs a substantial liability to income tax: see s159SA of the Income Tax Assessment Act. Once she is without employment, she will have to rely on unemployment benefits and, later, an age pension. Her pension might be reduced when the plaintiff becomes entitled to her superannuation. However, it is not likely that the pension will be affected to any marked extent because her superannuation will produce only a small income. All of these would have been relevant factors to consider at the date of Burke's death. Shortly stated, it was likely that she would not be able to obtain employment and would have to depend on a pension for income. By objective standards, she was left without adequate and proper provision, giving such weight to each of these words as the circumstances dictate: Pontifical Society for the Propagation of the Faith v Scales (supra) at 19.

In addition, notwithstanding that the plaintiff and Burke had divorced and had agreed upon a property settlement, other factors justified the plaintiff's claim. First, the plaintiff had purchased the equity of Burke in the matrimonial home and had to borrow to do so. There was no generous settlement upon her. The marriage between the plaintiff and Burke dissolved because he had left her to live with another woman. Notwithstanding that the divorce put an end to the shared matrimonial life (see Re Adams at 888), Burke and the plaintiff continued to maintain contact. After Burke had ceased cohabiting with that woman in 1982, the extent and degree of contact increased significantly. The plaintiff's willingness to continue to provide Burke with assistance in a material and practical way demonstrated that, for her part at least, the marital bond was not entirely severed. It is reasonable to infer that there was a reasonable degree of affection notwithstanding that the plaintiff and Burke did not again live together. It must be significant that the plaintiff had provided a good deal of care for Burke in one way or another for some 22 years, albeit not continuously in that period, and in the last eleven years on about a weekly basis.

The plaintiff provided extensive support to Burke, both tangible and intangible. She provided financial assistance in the form of loans, some of which at times when it would have been difficult for her to do so. The financial assistance was provided at times when she was not in full employment. She provided food and cooked meals. She assisted in routine domestic accounting and has tidied Burke's flat when she visited. She provided emotional support and loyalty to Burke. This emotional, financial and other support was provided by her over a period of about eleven years. She was one of very few friends who assisted and supported Burke in those years. It seems that Burke was not aware that he had siblings of any kind. Had Burke given any thought to the provisions of a will, it is likely that he would have had regard to both the plaintiff and Beddall because of the assistance that each had provided. Certainly, had Burke been a wise and just testator, he would have provided for the plaintiff in his will.

For all of these reasons, the plaintiff is without adequate provision and Burke owed a duty to make some provision for her.

There now remains the question of what provision ought to be made out of Burke's estate for the plaintiff. I have already mentioned that, had Burke considered what provision he would include in the will, it is likely that he would have had regard to both the plaintiff and Beddall. Beddall could not, of course, bring a claim under the Act so that he was not before the court. There is no evidence of the extent to which he rendered support and assistance to Burke. However, the fact that Beddall did provide assistance must be considered in determining the extent to which the plaintiff has a moral claim to share in Burke's estate. Regard must also be had to the position of the next of kin. They have no moral claim to share in Burke's estate. There is no evidence whether there was any contact between them and Burke. It is not clear whether Burke even spoke of them. It would be unrealistic to believe that Burke did not know of them. In all likelihood, his father would have mentioned them to him. However, they are at least 26 years older than he was and, at his death, were aged about 80 years. There is no evidence that they have any claim upon Burke's bounty. Whatever they receive will be a windfall.

The plaintiff's claim is strong. The extensive support she provided over two periods totalling some 22 years has already been mentioned. Her assistance, both as his wife and later after they had been divorced, would have assisted Burke to earn a good part of what became his superannuation entitlement. Although the jurisdiction of the court under this legislation is to provide for deserving persons according to their requirements and not to reward past services, nevertheless, in determining what is proper provision in all the circumstances of a particular case, the fact that a claimant has been loving, helpful or dutiful should not be ignored: see Gibbs J in Goodman v Windeyer (supra) at 498.

Though not small, the estate is not substantial. Thus, whatever provision is made will not be over generous. Like Jacobs J in Re Estate of Brooks at 404, I am tempted to ask why the whole of the estate should not go to the plaintiff, who has established a need. But that would be unrealistic, particularly having regard to the fact that, although reconciled, the plaintiff and Burke did not live together. Further, the plaintiff has had the benefit of the settlement upon the dissolution of the marriage. Nor can it be inferred that Burke did not intend to make even a small provision for his half brother and half sister.

For all of these reasons I order that the plaintiff be paid out of the estate of the deceased the sum of $75,000. The costs of the plaintiff and the defendants, taxed as between solicitor and client, are to be paid out of the estate of Burke.