BUTLER -v- BUTLER [2025] WASC 79 (13 March 2025)

1. On 16 January 2010, the deceased and Suzanne entered into the MWA. On the same date they each made wills bequeathing their entire estates to each other.
2. At the date of Suzanne's death, her estate comprised the following assets:

(1) money held in Suzanne's bank accounts;

(2) land at 60 Hunton Road, Kalgan;

(3) household chattels and furniture;

(4) tools and equipment;

(5) various motorbikes;

(6) a Quintrex boat trailer; and

(7) a Quintrex dinghy,

(1) the deceased appointed Suzanne as his executor (cl 3(a));

(2) the deceased gifted his entire estate to Suzanne (cl 7(a));

(3) if Suzanne did not survive the deceased then he gifted his estate to Damien, Sharr and Jayden in equal shares (cl 8(b));

(4) the deceased acknowledged that he made his 2010 will in conjunction with Suzanne's 2010 will and that he is bound by the terms of the MWA (cl 10(a)); and

(5) if the deceased predeceased Suzanne, the assets that devolve to Suzanne through his 2010 will are devolved in anticipation of Suzanne leaving them as provided for in the MWA (cl 10(b)).

(1) execute his 2010 will (as provided for in the Schedule to the MWA) (cl 2(a));

(2) act in such a way that property affected by MWA devolves to Damien in the manner and proportions set out in the terms of his 2010 will, unless Suzanne or Damien otherwise consents in writing (cl 2(b));

(3) not enter into any inter vivos transaction (or series of transactions) designed to significantly diminish, or having the effect of significantly diminishing, property affected by the MWA and in particular, that he would not make any substantial gifts or form any joint tenancies with any other person using property affected by the MWA (cl 4(a)); and

(4) property affected by the MWA were assets the deceased held or was entitled to immediately after Suzanne's death other than:

(i) assets he inherited from someone other than Suzanne or acquired by windfall or which he was given, other than from Suzanne, following the execution of the MWA; and

(ii) assets he accumulated after Suzanne's death other than through re-investment of assets received from Suzanne's estate.

(1) appointed Britt as the executor (cl 2.1);

(2) left his residuary estate to Britt (cl 6.1); and

(3) provided that his estate includes both real and personal property (cl 6.3).

1. The legal principles applicable to a mutual wills agreement are comprehensively set out in the plaintiffs outline of submissions dated 14 February 2025 which I gratefully adopt.
2. In summary, a mutual wills agreement is:[1]

(1) a disposition of trust property by the first party under a will in an agreed form and on the faith of the survivor carrying out the obligation of the contract which attracts the intervention of equity in the survivors favour;

(2) that intervention is the imposition of a constructive trust;

(3) the subject-matter is the property passing to the survivor under the will of the first party;

(4) that property which passes to the survivor is identified after due administration by the first party's legal personal representative where the dispositions of the will become operative; and

(5) there is a floating obligation over the property which has passed to the survivor which is suspended during the lifetime of the survivor and crystalises into a trust upon the assets of the survivor at death.

1. The constructive trust created pursuant to a mutual wills agreement:

(1) is in the form of an institutional constructive trust.[2] The institutional constructive trust arises at a point in time having regard to the relationship between the parties and the parties conduct;[3]

(2) crystalises into an irrevocable arrangement after the first testator dies;[4]

(3) is not destroyed on the remarriage of the second testator;[5] and

(4) the terms of the trust are the terms of the first will which the second testator gave an undertaking would be his last will.[6]

1. Despite the existence of a mutual wills agreement and a previous will of the second testator, a later will that breaches a mutual wills agreement is valid and will be admitted to probate.[7] It is the mutual wills agreement rather than the form of the wills that attracts relief at law or in equity.[8]
2. Because of the existence of a mutual wills agreement, the beneficiaries of the later will of the second testator:[9]

(1) are entitled to claim those assets which remain after satisfaction of the intended beneficiaries entitlements under a mutual wills agreement and former will; and

(2) will hold property derived by them under the later will as trustees for the beneficiaries under the first will and the mutual wills agreement.

1. The existence of a mutual wills agreement does not preclude a person entitled under the Act from making a claim for provision out of the estate of the second testator under the Act.[10]

Legal principles applicable to a claim for provision under the Act

1. Section 6(1) of the Act permits an application to be made for orders that provision be made out of a deceased's estate to a person in respect of whom adequate provision has not been made for that person's proper maintenance, support, education, or advancement in life.
2. The persons who can apply under s 6(1) of the Act are provided for in s 7(1) of the Act. A person who is married to the deceased immediately before the deceased's death may make an application.[11]
3. The Act provides that provision be made out of the estate of the deceased. The deceased's estate comprises the property which a deceased beneficially owns at the time of death and which passes to the deceased's legal personal representative. The deceased's estate is bound by contractual obligations entered into by a deceased during his or her lifetime.[12]
4. Section 7(2) of the Act provides that no application under s 6(1) of the Act shall be heard by the court unless:

(1) the application is made within 6 months from the date of the grant of probate; or

(2) the court is satisfied that the justice of the case requires that the applicant be given leave to file out of time.

1. Section 7(3) of the Act provides that a motion for leave to file out of time may be made at any time notwithstanding the expiry of the 6‑month period referred to in s 7(2) of the Act.
2. The court's exercise of power to grant an extension of time under s 7(2) of the Act is discretionary. That discretion is unfettered but must be exercised judicially and have regard to what is just and proper.[13]
3. The plaintiff bears the onus of establishing that the justice of the case requires that leave be given out of time to make an application under s 6 of the Act.[14]
4. The following factors are relevant to the exercise of the court's discretion to grant an extension of time:[15]

(1) whether the plaintiff has an arguable case;

(2) the reasons for delay in making the application;

(3) whether the plaintiff had entered into negotiations with the beneficiaries prior to the time limit expiring;

(4) whether or not the estate has been distributed before the claim was made or notified; and

(5) whether a refusal to extend the time would leave a plaintiff without redress.

1. In determining whether Britt's claim for provision out of the estate of the deceased is arguable, the following matters are relevant:

(1) Britt's financial position;

(2) Britt's need for, and moral claim to, additional provision from the estate;

(3) the lifestyle to which Britt had become accustomed during the deceased's lifetime;

(4) the size of the estate at the date of the deceased's death; and

(5) the existing rights of Damien, Sharr and Jayden under the MWA.

1. Although Britt was the beneficiary of the deceased's entire estate under the 2015 Will, the effect of the MWA and the deceased's 2010 will is that:

(1) Suzanne's 2010 will was in the form agreed to by the deceased pursuant to the MWA;

(2) Suzanne's Property was bequeathed to the deceased under her 2010 will;

(3) on Suzanne's death on 4 March 2010 the terms of the deceased's 2010 will and the MWA crystalised into an irrevocable arrangement;

(4) that irrevocable arrangement under the deceased's 2010 will and the MWA was not destroyed by the deceased remarriage to Britt;

(5) by the 2015 Will, the deceased departed from the terms of the MWA and his 2010 will; and

(6) there is a floating obligation over Suzanne's Property which passed to the deceased that crystalised into a constructive trust for the benefit of Damien, Sharr and Jayden on the deceased's death.

(7) Britt, as executor of the deceased's estate, hold Suzanne's Property subject to Damien, Sharr and Jayden's equitable interests; and

(8) Britt as beneficiary under the 2015 Will is only entitled to that part of the deceased's estate which remains after satisfaction of Damien, Sharr and Jayden's interests and entitlements under the deceased's 2010 will and the MWA.

1. The existence of the MWA does not, however, preclude Britt from making a claim for provision from the estate of the deceased for her proper maintenance, support, education, or advancement in life. Such provision may require the realisation of some or all of Suzanne's Property.
2. I am satisfied that Britt has an arguable case that the deceased failed to make adequate provision for her from his estate (assessed at the date of the deceased's death) because:

(1) Britt was left without a home because the equitable interest in 60 Hunton Road Kalgan, (Britt and the deceased's family home), will pass to the Damien, Sharr and Jayden pursuant to the MWA and his 2010 will;

(2) Britt has a financial need in that she has:[16]

(a) savings totalling $271.99;

(b) superannuation of $51,282;

(c) shares to the value of $6,000;

(d) liabilities of $7,800; and

(e) lost the support of the deceased's pension;[17]

(3) Britt's following medical circumstances have a negative impact on her ability to earn an income:[18]

(a) rheumatoid arthritis;[19]

(b) carpal tunnel syndrome;[20]and

(c) damaged shoulder rotator cuffs and bursitis.

(4) the deceased has a moral obligation to provide for Britt from his estate:

(a) as his wife; and

(b) considering her financial and non-financial contributions during the deceased's lifetime.[21]

1. I am also satisfied that Britt's delay in making an application for provision from the deceased's estate pursuant to the Act was reasonable in the following circumstances:[22]

(1) in July 2023, Damien, Sharr and Jayden commenced proceedings in this court seeking declaratory relief that Britt, as executor, holds the deceased's estate on constructive trust for them pursuant to the MWA;

(2) the parties attended a mediation of those proceedings on 24 February 2024;

(3) the proceedings were not resolved at the mediation, however since that date the parties have been engaged in extensive negotiations to resolve all current and future issues that may arise in relation to the deceased's estate; and

(4) the parties have reached an in principle agreement to resolve all current and future issues that may arise in relation to the deceased's estate subject to leave being provided to Britt to commence proceedings under the Act and orders being made pursuant to s 6 of the Act for her provision out of the estate of the deceased.

1. The estate remains unadministered and Britt may be left without redress if an extension of time is not granted because Damien, Sharr and Jayden claim that Suzanne's Property is held by the deceased's estate on constructive trust for them.
2. Having regard to these factors, I am satisfied that the justice of the case requires that Britt be granted leave to make an application for provision from the estate of the deceased out of time.

(1) The plaintiff have leave pursuant to s 7(2) of the Family Provision Act 1972 (WA) (Act) to make an application for provision out of the Estate of the late Colin Armitage Butler pursuant to s 6(1) of the Act out of time and within 14 days of the date of the extension order being made.

(2) There be no order as to costs.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.

[1] Barns v Barns [2003] HCA 9; (2003) 216 CLR 169, 85 (Barns); Commissioner of State Revenue v Harrison [2019] QCA 50, 85; Birmingham v Renfew [1937] HCA 52; (1937) 57 CLR 666, 689, 690; Low v Public Trustees of WA (1995) 14 WAR 35, 45; Fazari v Cosentino [2008] WASC 149 [20].

[2] Hubbard v Mason (Unreported, NSWSC, Library No 2037, 9 December 1997) [12]; Lawrence, in the matter of Ozifin Tech Pty Ltd (in liq) v AGM Markets Pty Ltd (in liq) [2022] FCA 1478 [176] ‑ [180]. See also Nolan v Nolan [2004] VSCA 109 [61] regarding the difference between institutional and remedial constructive trusts.

[3] Westdeutsche Landesbank Girozentrale v Islington London Borough Council [1996] UKHL 12; [1996] AC 669; [1996] 2 All ER 961, 997; Raden P & Stewart C (2019) Principles of Equity and Trusts (4th ed, Lexis Nexis, Sydney) page 860. As opposed to a remedial constructive trust which exists from the date of the court order and results from the exercise of judicial discretion.

[4] Birmingham v Renfew (682, 683 and 685 - 689); Re Goodchild [1996] 1WLR 694, 698 - 699, 700, 702. Bigg v Queensland Trustees Ltd [1990] 2 Qd R 11, 15, 16.

[7] Birmingham v Renfew (666, 674, 676, 683); Bigg v Queensland Trustees Ltd (13); Fazari v Cosentino [18].

[8] Bigg v Queensland Trustees Ltd (13).

[9] Bigg v Queensland Trustees Ltd (13, 17); Swain v Mewburn (Unreported, WASC, Library No 36, 17 February 1994) 11.

[12] Bushby v Gayle Kristin Bushby as Executor of the Estate of Florence Born [2024] WASC 54 [55] citing Barns.

[13] Larkan v Larkan [2022] WASC 169, 12(1) (Larkan).

[16] Affidavit [85] - [86], annexure BHB-6, page 46.