Chan v Chan

(b) history of dependence

1. The second matter material to the application is the history of the appellant's dependence on his father for financial support. It is consistent with, and explained by, the psychological assessment discussed above. Thus, after leaving school, the appellant undertook a course in accounting which he did not complete. [12] For some 15 years, he worked in his father's business in New Guinea. In 1988 he returned to Sydney, his father providing financial assistance to enable him to purchase a home at Killara.
2. Some two years later, the appellant and his wife separated and the Killara property was sold. His wife and children moved into the property at Robert Street, Gordon, then owned by the appellant's mother. He purchased a unit in Fitzroy Street, Surry Hills.
3. In 1997 the appellant and his wife divorced, with his wife and family moving to a property in Willoughby provided by the deceased. The appellant moved into the Robert Street, Gordon property. The deceased paid the outgoings on the property; the appellant did not pay rent.
4. This brief history revealed that the appellant was financially dependent upon his father throughout his father's lifetime. It also reveals that his father made very substantial provision both to his family and to the appellant.

(c) appropriate accommodation

1. The third matter concerns the present circumstances of the appellant. On the one hand, the Robert Street, Gordon property is undoubtedly too large for the appellant's needs and it is well beyond his capacity to maintain it. Part of the roof has fallen in; toilets and bathrooms do not work. There is clearly an urgent need for both maintenance and structural repair.
2. On the other hand, the appellant expressed an unwillingness to move and a disbelief in the availability of alternative satisfactory accommodation, within his price range.
3. The trial judge noted that, while the property required major repairs, it was unencumbered and had a value of $1.7 - $1.9 million. [13] The judge noted the appellant's evidence that he would like to repair and upgrade the house and its furniture and fittings. He also gave evidence that he would need funds to live upon and would like to purchase a small motor vehicle. He said that the $50,000 legacy received in March 2012 had been spent. [14] In summarising his present circumstances, the judge noted that the house was "in a poor condition and is deteriorating" and that the property appeared to be "in a general state of disrepair, both inside the house and outside the house." [15] The judge continued: [16] "Clement Chan's present living arrangements are problematic. He does not have the money to restore the property, but he does not want to move away. I accept that he has formed an emotional attachment to the home and that moving away would cause him some distress and anxiety."

Relevant principles

1. A precondition to a family provision order is the satisfaction of the court that the testator has not made "adequate provision for the proper maintenance … or advancement in life of the person in whose favour the order is to be made". [17] Importantly, the question of adequate provision is to be assessed at the time when the court is considering the application. [18] The basis upon which the evaluative judgment is to be undertaken is by no means restricted; there is a long list of matters which may be considered, set out in s 60(2) of the Succession Act. The relevance of such factors will depend upon the circumstances of the particular case. A common issue in claims which are unresolved and come to trial is the closeness of the relationship between the testator and a particular family member who seeks provision. That factor was not in dispute in the present case. The trial judge stated: [19] "I accept that Clement Chan maintained a reasonably good relationship with his father, although the relationship seems to have withered after 2007 when August Chan was living in Benedict Chan's house. Again, August Chan provided considerable financial assistance to Clement Chan, including throughout his adult years."
2. A significant set of factors in many cases is that identified as "the financial resources (including earning capacity) and financial needs, both present and future, of the applicant…". [20] However, it is important not to elide the distinction between needs and adequate provision; the former is but one indicator of the latter. The adequacy of provision is not to be determined by a calculation of financial needs. The background to any consideration of the appellant's needs required determination of the size of the estate and the claims of others on the beneficence of the testator.
3. With respect to the estate, the judge accepted that the total value lay between $11 million and $16 million. The appellant complained that the judge should have accepted a figure at the top of the range, because the party responsible for the lack of evidence permitting a more precise calculation was the respondent, as executor, and, against his interest, the higher value should be assumed. However, unless the Court were to consider provision well in excess of $1 million, it is unlikely that this factor would be significant. (As will be indicated below, a greater sum need not be considered in the present case.)
4. With respect to others having an interest in the estate, the claims of the daughters having been rejected, the only competing claims were those of the residuary beneficiary, namely the respondent. Again, the factual assessment of the trial judge was not challenged. The trial judge was satisfied that the respondent was close to his father and had a close involvement with his business activities, throughout the respondent's adult life. The judge said that "[i]t is clear that Benedict Chan played an important role in the success of his father's business ventures." [21] The judge continued: [22] "It is also clear that Benedict Chan maintained a very close relationship with his father throughout his life. Following his father's suggestion, he built his home on the block next door to his parent's home in Roseville. In about late 2007, August Chan moved into Benedict Chan's house so that he could be better looked after. Renovations were carried out to the house to enable that to occur."
5. Although the respondent was 66 years of age at the time of the hearing below, he put on no evidence that he was in financial need, nor that he would be significantly prejudiced if provision were made in favour of the appellant. The trial judge did not suggest otherwise; the complaint made on the appeal is that the judge failed to give proper weight to the size of the estate, the large proportion conferred on the respondent and the respondent's lack of financial need.

Application of principles

1. Against these background considerations, it is convenient to address the needs of the appellant. In broad terms, that assessment resolved itself into two considerations. First, in leaving to the appellant the Robert Street property, the deceased effectively (and properly) recognised that the appellant had substantial needs for financial support and assistance which the deceased had met throughout his life. However, accepting that proposition, the appellant said, in substance, that he had been provided with accommodation, but not the means to maintain it or support himself in it. Thus, it was now clear, and indeed would have been at the date of the testator's death, that the legacy of $50,000 was nowhere near sufficient and, indeed, was not an equivalent figure to that which the deceased had provided for the appellant, whilst alive.
2. The countervailing proposition was that there was no obligation on the appellant to retain the house, nor did he have a need for the house. If the house were to be sold and appropriate alternative accommodation purchased, the appellant would have been adequately provided for. On that approach, it was wrong to see the appellant as having financial needs extending to the cost of repair and maintenance of the Robert Street property.
3. The trial judge accepted the latter approach, which was that put forward by the respondent. The judge supported that conclusion with the following calculations: [23] "There was evidence that good quality two bedroom units in Gordon, close to the shops and public transport, could be purchased for between about $760,000 and $850,000, and one bedroom units in the area from about $575,000. If it is assumed that the Gordon property was sold for $1.7 million, a capital gains tax liability (as agreed between the parties) of about $240,000 would be payable. If net proceeds of sale (after payment of capital gains tax) of about $1.4 million is assumed, it would appear feasible for Clement Chan to acquire a two bedroom unit in the area and still be left with a fund well in excess of $500,000. Such a fund could be used to supplement income, meet special items of expenditure, or as a buffer against contingencies. It could be utilised to acquire some of the services which Ms Alcock referred to in her evidence, including domestic help and nursing support services."
4. As the appellant noted in his written submissions, the effect of this analysis was to discount the appellant's expressed wish to remain in the Robert Street property. Referring to his counsel's submissions at trial, the judge stated: [24] "Mr Willmott submitted that Clement Chan's desire to remain in his home should be respected. Whether Clement Chan so remains is, of course, his own decision. His right to make that decision is respected, but it is another matter entirely to regard that decision as determinative of Clement Chan's present or future needs. I note further that there must be considerable doubt about whether Clement Chan would ever actually undertake a building repair project of the magnitude contemplated here."
5. On appeal, this reasoning was challenged on a number of grounds. First, it was said to ignore the apparent intention of the testator that the appellant should be able to continue to reside in the Robert Street property, in which he had already been living for almost a decade when the will was executed.
6. Secondly, it was submitted that the reference to a "desire to remain in his home" failed to give proper recognition to the evidence of Dr Westmore, apparently accepted by the trial judge, that a "relocation would obviously be very difficult and stressful for him". [25] This material went significantly beyond a "desire to remain" or not wanting to move away.
7. It would be wrong to suggest that the trial judge disregarded this factor. In the critical passage in his reasoning, he accepted the emotional attachment to the home and the fact that moving away would cause him "some distress and anxiety." [26] The judge continued: "Nevertheless, I do not think that it should therefore be concluded that Clement Chan has a present need for $500,000 to restore his home."
8. It is well established that the assessment of what constitutes "adequate provision" for the "proper maintenance" of the person seeking provision is to be assessed having regard to the pre-existing conditions of the applicant and not by an entirely objective assessment in monetary terms of assumed needs. On occasion, that has been explained by reference to what are sometimes described as "moral claims", recognised by the legislation. Thus, in Vigolo v Bostin [27] Gummow and Hayne JJ stated: "It is not disputed that, as Williams J observed in Lieberman v Morris [28] of the then New South Wales legislation [29] , 'in the case of large estates, provision can be made for the well-to-do'. In this Court, counsel affirmed that the application under the Act was not brought on the basis of financial need, but on the basis of a 'moral claim' to adequate provision for the proper advancement in life of the appellant."
9. To similar effect, Callinan and Heydon JJ stated in Vigolo: [30] "The use of the word 'proper' means that attention may be given, in deciding whether adequate provision has been made, to such matters as what used to be called the 'station in life' of the parties and the expectations to which that has given rise, in other words reciprocal claims and duties based upon how the parties lived and might reasonably expect to have lived in the future."
10. Callinan and Heydon JJ continued: [31] "'Maintenance' may imply a continuity of a pre-existing state of affairs, or provision over and above a mere sufficiency of means upon which to live. … And, furthermore, provision to secure or promote 'advancement' would ordinarily be provision beyond the necessities of life."
11. From these factors, other considerations follow. As the appellant correctly noted, the assessment of provision should be made in the context of the overall estate and competing claims. Further, although it was no doubt proper for the trial judge to discount what might be thought to be extravagant claims, there was no suggestion that the appellant's claims were extravagant or seeking a lifestyle above his "station" or expectations. Indeed, rather the contrary.
12. Counsel for the appellant drew attention to the statements in Kleinig v Neal [No 2], [32] in which, having rejected the suggestion that any narrow view should be taken of the statutory language with respect to provision, Holland J continued: "Nor do I think there is any warrant for isolating the question of the existence of a need from a consideration of the size of a testator's estate. If the Court is to make a judgment as to what a wise and just testator ought to have done in all the circumstances of the case, it could not be right to ignore that the particular testator was a wealthy man in considering what he ought to have done for his widow or children in making provision for their maintenance, education or advancement in life. There are different levels of need for such things. In the case of maintenance and advancement in life they can range from bare subsistence up to anything short of sheer luxury."
13. In an otherwise careful and considered judgment, dealing with a multitude of issues, and involving three separate proceedings, it should be accepted that the judge erred in so far as he determined the adequacy of the provision made by the appellant's father by reference to the appellant's objectively assessed financial need, divorced from the size of the estate and the claims of the only competing beneficiary. According to the assessment of the value of the estate at the time of Mr Chan's death, the appellant received 12.3% of the value and his brother 87.7%. It may be accepted that the respondent should properly retain the bulk of the estate, in part because he had looked after their father in his last few years and also because he had played an important role in managing the business which gave rise to his father's wealth. That is not to say that the respondent was not remunerated for his services along the way, nor that it is possible to place any proportionate benefit on his involvement. Certainly he did not proffer evidence to that end. On the other hand, the degree of functional impairment suffered by the appellant demonstrated a real need which should properly have been met from the estate. The appellant was living in a house which was barely habitable. He was clearly not in a position to obtain the assistance he needed in managing the property, nor that required for managing his own life. In assessing those needs, the Robert Street house provided during the testator's lifetime, should not have been treated as an asset which should be sold upon the testator's death, to justify rejecting a claim against his estate.
14. In those circumstances, the parties accepted that it would be appropriate for the Court to assess the provision which should be made.

Assessment of provision

1. To assist with the exercise, in the event that the Court was minded to intervene, the parties tendered further documentary evidence.
2. Before assessing that material, it is necessary to have regard to one further exercise undertaken by the trial judge. The primary focus at trial appears to have been on the sum of approximately $500,000 which, on the evidence, was the likely cost of undertaking necessary repairs to the house at Robert Street. However, the judge also gave consideration to the argument that the appellant needed provision to assist with living expenses. He dealt with the matter in the following passage: [33] "Clement Chan has been living for many years on social security benefits. He has estimated his expenses as exceeding his benefits by about $300 per fortnight. However, no explanation was given as to how any excess expenditure was funded. In those circumstances, I am not prepared to conclude that Clement Chan has a need for income or support additional to that which he currently receives, or will in the future have a need for such. In any event, as noted above, it is within his power to rearrange his financial affairs so that a substantial fund, which could be used to supplement his income, is established."
3. There was no opposition to the tender of further evidence on the appeal and, indeed, the respondent took the opportunity to file his own affidavit which sought to answer some of the omissions in the evidence before the trial judge and to provide updated valuations of the estate, both distributed and undistributed. He further provided evidence of available premises, in effect to support the view that the appellant could reasonably be expected to sell the Robert Street house and buy a smaller property in the same area, and have a remaining fund to cover living expenses.
4. Apart from a further affidavit of the appellant, to which reference will be made below, the significant affidavits filed on behalf of the appellant included one from the building consultant, Richard Coulthard, who had given an estimate of the cost of repairs to the appellant's house and had given evidence at trial. He advised that he had visited the Robert Street property again, on 29 April 2016, and prepared an updated report. Although there had been further deterioration in the condition of the premises, he affirmed that the cost estimated in his earlier reports, namely $529,000 (including GST) still stood.
5. There was also a further affidavit by Karen Alcock, the occupational therapist, updating her earlier estimates of the cost of nursing and support care which she had identified in her earlier report. Ms Alcock divided her cost estimates into two stages, the first being for 10 years from 2014 to 2024 (now from 2016 to 2024) and the second (from age 75) being for the remainder of the appellant's life.
6. Ms Alcock provided a "cost summary" during stage 1, giving an annual cost of $40,000 (in round terms) and at stage 2, $112,500. In both the grounds of appeal and in the written submissions, a claim was made for an amount of $152,000 for "occupationally [sic] therapy support" and a further $30,000 for "the acquisition of household goods and a second hand car". These figures are difficult to comprehend. First, Ms Alcock's calculation included amounts for a wide range of household goods, on an annualised basis. Secondly, because she provided costs on an annual basis, it makes no sense to add together two sets of annual costs as the calculation of a fund to cover costs during the appellant's lifetime. The adequate provision in relation to domestic care and assistance, might require the calculation of a capitalised sum sufficient to meet future needs. That was not done. This difficulty was not addressed at trial: Ms Alcock was cross-examined as to aspects of her assessment regarding the appellant's abilities, his relationship with the family of one of his children and her assessment of his cognitive skills and whether he might be better off in alternative accommodation. There was no attempt to address the calculations annexed to her report, nor their use in the claim.
7. There are other practical difficulties. One is that no consideration appears to have been given to the possibility that in years to come the appellant may need to sell his house and enter a retirement village or nursing home. Ms Alcock's calculations appear to have been based on a marked increase in the level of services from age 75 onwards, to allow him to remain at home.
8. It is difficult to know what to do with this material. In substance, the only course available to this Court is to consider whether some services will be required, and presumably on an increasing basis over the years beyond 75, and determine an amount by way of provision towards to the costs of those services.
9. The appellant also claimed an amount of $20,000 for psychological treatment. The basis of the calculation and the need were not properly identified in the submissions before this Court.
10. The appellant gave evidence that he was currently in receipt of a Centrelink pension of $774 per fortnight and that his expenses exceeded his income by $300 per fortnight. He provided evidence that in November 2015 he had received a personal loan of $20,000 from his bank. The funds had been used for some repairs to his property, to pay long outstanding bills, including with respect to council rates, and to contribute to the shortfall between his pension and expenses. There was an outstanding balance at 23 March of $11,200, which did not explain why an amount of $20,000 was required to pay off the loan.
11. On the premise that the appellant was to receive a significant lump payment by way of provision, Ms Alcock noted that a question had been raised by the psychologist, Ms Longley, as to the desirability of independent financial advice, possibly including a funds manager. She included such an item in her list of expenses, but did not put a figure against it. [34]
12. Turning to the cost of repairs to the house, Mr Coulthard was cross-examined at trial to suggest that the expenditure of $480,000 (before GST) was a disproportionate expense on an old house and that better value would be obtained by removing the existing house and rebuilding. The results of the cross-examination were inconclusive.
13. On the other hand, Mr Coulthard's report was cursory in its calculations. The report, originally prepared on 26 August 2013, listed 20 items which needed attention and then gave a cost estimate "for the repairs to liveable standards", being $213,000 (plus GST) and a cost of repairs "for balance of works" of an additional $196,000 (plus GST). The total was, therefore, $409,000 (plus GST). One of the items included in the list of external repairs was identified as "the back roof has collapsed and is in need of urgent repair."
14. Mr Coulthard produced a further report on 17 February 2015 which added a further paragraph, without otherwise varying the description of the work done. That report stated that since the earlier inspection, "we noticed that the back roof that we previously clarified in our correspondence dated 26 August 2013 that this roof has now collapsed and has now fallen in." An additional cost was added to "rectify the roof" in an amount of $72,000 (plus GST). The cross-examination of Mr Coulthard failed to clarify how the various figures were reached, except to confirm that there had been some calculations best described as rough and ready.
15. In considering an amount by way of provision, it is appropriate also to have regard to the diminution of the estate on account of legal costs. Prior to the trial, which took place in March 2015, the appellant's solicitor provided an estimate of his legal costs, calculated on the ordinary basis, at a little under $68,000 (inclusive of GST). (The trial ran for six days.) Somewhat surprisingly, she provided an estimate of the costs of the appeal in an amount of $125,000 (plus GST). The appeal was completed within one day. There was no evidence updating the estimated costs of the trial, and it should be noted that the solicitor appeared for the daughters in their proceedings at trial and estimated their costs separately. The costs of the appeal appear high, even taking account of the preparation of further evidence.
16. The respondent filed an affidavit outlining some of the costs which he would incur in the event that further provision was required from the estate. He did not make any express estimate as to his legal costs. However, it may be assumed that he has incurred costs in resisting the appellant's claim which he will notionally attribute to the estate.
17. Although the trial judge was not prepared to be precise as to the value of the estate, the updated estimate prepared by the respondent for the purposes of the appeal indicated a total value of the distributed and undistributed estate at a little over $15 million. It should be accepted that any reduction on account of legal costs will not significantly affect the value of the estate.
18. In assessing the likely needs of the appellant, it is clear that the most pressing need is to place the Robert Street house, which has now been transferred into his name, into a liveable condition. The respondent submitted that the highest figure proposed by Mr Coulthard, namely $509,000 should not be accepted. At best, he contended, the figure of $213,000 to make the house liveable might provide some guidance. There had, the submission noted, been no discussion between Mr Coulthard and the appellant as to what precisely the appellant would wish to have done to the house. Further, the basis for the calculations, as explained in Mr Coulthard's oral evidence gave no faith in the final figures asserted. Those submissions should be accepted.
19. On the other hand, the respondent's submission that the appellant had no current need, and no predictable future need, for services should not be accepted. His level of functional impairment is clearly significant, as assessed by Ms Longley and Dr Westmore. On the other hand, little assistance can be obtained from Ms Alcock's calculations.
20. I would calculate appropriate provision on the following basis. Assuming that the net value of the estate is in the order of $15 million, given the appellant's needs and the competing interests of the respondent, he should receive further limited provision out of the estate. On the calculation adopted by the respondent, the value of the Robert Street property was $2.05 million. In addition, he had obtained payment of the bequest of $50,000, giving a total value under the will of $2.1 million on current values. Making allowance for the fact that the estate will bear the costs of the proceedings on both sides, including the costs of realising assets for the purposes of distribution, the appellant should receive a further amount of $700,000, giving a total payment of less than 20% of the estate, as currently valued.
21. On the evidence before this Court, which did not see Mr Clement Chan give evidence, there appear to be real doubts about his ability to manage such a sum. However, no order was sought by either party as to the appointment of a financial manager and it is not a matter which can be dealt with in this proceeding.

Cross-appeal

1. There remains the question of the respondent's cross-appeal.
2. The grant of leave to bring proceedings out of time is very much a matter of practice and procedure, to be dealt with in the Equity Division. An appeal against the grant of leave itself requires leave (the decision of the trial judge being interlocutory). The circumstances in which leave to appeal should be given, are constrained according to the well-known principles governing the exercise of discretionary powers of case management. Despite that, the notice of cross-appeal contained eight separate grounds, one of which had six paragraphs. The submissions in support of the cross-appeal, including passages picked up from the respondent's submissions on the appeal, may well have exceeded the page limit on written submissions provided for in the rules. Despite all that, no basis for interfering was identified.
3. In some respects the intention of the cross-appeal itself was puzzling. If the appellant failed on the substantive appeal, the question of an extension of time within which to bring the application, was rendered moot. On the other hand, if the appellant succeeded on the substantive appeal, it became highly unlikely that he would be denied success by a reversal of the decision of the trial judge to extend time. That this situation may not have been fully thought through is revealed by the ground in the cross-appeal which challenged the finding of the trial judge that the appellant's claim "was not devoid of merit." The only circumstance in which the cross-appeal could be material was where the contrary view had been established. (There was no attempt to have the cross-appeal heard separately and before the substantive appeal.)
4. In addition to the question of merit, the trial judge placed weight on three considerations. The first was his assessment of Clement Chan's intellectual difficulties (including his poor ability to understand abstract concepts), [35] the basis for which has been explained above. Further, rendering a challenge to this important consideration difficult, if not doomed to fail, the judge expressly relied upon his observations of Clement Chan in the witness box in assessing his (Mr Chan's) understanding of his right to make a claim.
5. Secondly, in circumstances where his sisters had made timely claims it was clear that the executor and only other beneficiary, namely the respondent, was on notice that provision might need to be made from the estate. On the other hand, whilst the appellant was aware of those claims, he was himself a beneficiary under the estate and his sisters were not, a factor which may well have affected his appreciation of his right to make a claim.
6. Thirdly, there was the assessment of merit, a matter already dealt with.
7. As the cross-appellant noted, grounds 1, 2 and 3 concerned the awareness of the appellant of his right to make a claim and the judge's assessment of the relevance of his functional impairment. Those grounds are without evident merit.
8. Grounds 4, 5 and 6 raised issues as to the asserted failure of the trial judge to give adequate consideration to the claims made by the two sisters, the fact that their solicitor also acted for the appellant, the fact that neither sister opposed the order for an extension of time, their evidence as to what the appellant knew at various times, the judge's assessment of the credibility of the evidence of one sister, Beatrice McCleary, as to the appellant's confusion about his rights and a claim that it was in some respect unconscionable for the appellant to be allowed to pursue the claim. The concept of unconscionability relied upon by the respondent in this context included conduct that was "a deliberate holding off [in bringing proceedings] designed to lull the beneficiaries into a false sense of security." [36] This was an entirely irrelevant consideration, given that the judge's assessment of the appellant's conduct did not come close to such a characterisation.
9. Ground 7 raised the issue of his assessment that the claim "was not devoid of merit" and must be rejected for the reasons given above. Ground 8, the respondent conceded, provided no further basis for the cross-appeal.
10. Section 58(2) of the Succession Act permits an extension of time where "sufficient cause" is shown. The judge was satisfied, without entering into a detailed analysis of the procedural history of the various matters before him, that sufficient cause had been shown. That assessment was not shown to be based on any legal error or other misapprehension of fact or principle. In those circumstances, the cross-appeal must be rejected and the cross-appellant (respondent) must pay the costs of the cross-respondent (appellant).

Proposed amended notice of appeal

1. As Payne JA explains below, the appellant sought leave to file in court an amended notice of appeal. The amendments addressed two issues. The first concerned the extension of time within which to bring the proceedings. Although the primary judge had indicated his willingness to extend time, no formal order was made to that effect. Such an order should be made, but no amendment to the notice of appeal is required for that purpose; indeed, the cross-appeal assumed that such an order had been made.
2. Secondly, the notice proposed an order establishing a protective trust, pursuant to s 66(1) of the Succession Act, in the event that the appellant was successful in obtaining further provision. For the reasons explained by Payne JA, it is not appropriate for that issue to be dealt with in this Court, raised, as it was, at the end of the hearing of the appeal. However, the parties should have the opportunity to seek such an order in the Equity Division. The matter should be remitted to allow that to occur and the order for further provision should be stayed to provide an opportunity for either party to make an application in the Equity Division. Again, there is no need for the amended notice of appeal to provide a basis for such orders.

Conclusions

1. In these circumstances, the Court should make the following orders: 1. Dismiss the cross-appeal and order that the cross-appellant (Benedict Chan) pay the costs of the cross-respondent (Clement Chan) of the cross-appeal. 2. In respect of the appeal, 1. Allow the appeal and set aside the order of Darke J made on 30 July 2015 dismissing the application by Clement Chan under the Succession Act 2006, with respect to the estate of his late father, August Ying Kiang Chan. 2. Set aside the orders made by Darke J on 16 September 2015 in relation to the costs of proceedings 2013/187391. 3. Extend the time for the making of the application until 18 June 2013. 4. Subject to (f) and (g) below, order that further provision be made out of the estate of August Ying Kiang Chan in an amount of $700,000 payable to the appellant, Clement Wai Shing Chan. 5. Refuse leave to the appellant to file an amended notice of appeal. 6. Remit the matter to the Equity Division to consider any application by either party pursuant to s.66(1) of the Succession Act 2006 for the provision ordered under (d) above to be held on a protective trust for the appellant and to be applied to the use of the appellant towards the repair and maintenance of the property at 10 Robert St, Gordon and otherwise for the appellant's needs, with such powers of investment as are prescribed in Pt 2, Div 2 of the Trustee Act 1925 (NSW). 7. Stay the order for further provision in (d) above for 28 days and for such further time as may be ordered by a judge of the Equity Division to allow the determination of any application made in accordance with (f) above. 8. Order that the respondent, Benedict Chan, pay the costs of Clement Chan in this Court and in the Equity Division.
2. SIMPSON JA: I agree with Basten JA.
3. PAYNE JA: I have had the advantage of reading in draft the judgment of Basten JA. I agree with the orders his Honour proposes. Subject to what appears below, I agree with his Honour's reasons for upholding the appeal. I agree with Basten JA's reasons for dismissing the cross-appeal.
4. The appellant was almost 66 years old at the time of hearing this appeal. Throughout his adult life the appellant had been dependent upon the testator for significant and ongoing financial support.
5. This was most clearly demonstrated by the testator's purchase of an apartment for the appellant in Surry Hills in the 1980's following the breakdown of the appellant's marriage. It was further demonstrated by the testator's permitting the appellant to live, rent free, in the Robert Street property for over a decade.
6. The testator accepted over many years an obligation to provide accommodation for the appellant, no doubt due to the appellant's intellectual and psychological shortcomings. The testator also accepted during his lifetime, at least until he fell ill towards the end of his life, an obligation to pay for repairs, upkeep and outgoings for the Robert Street property. The testator's will, however, while leaving the Robert Street property unencumbered to the appellant, failed to provide sufficient funds to the appellant to pay for repairs, upkeep and outgoings for that property.
7. What is also clear on the evidence is that the appellant wished to remain living at the Robert Street property as he had for over a decade.
8. Whilst I was initially attracted by the careful and thorough approach to the issues reflected in the reasons of the primary judge, ultimately I was persuaded that the significance of the appellant's dependence upon the testator for his accommodation, the appellant's strong desire to remain at the Robert Street house and the size of the estate made it appropriate that this Court should intervene. Consideration of each of these issues, in combination, leads me to conclude that adequate provision for the proper maintenance and advancement in life of the appellant had not been made under the testator's will.
9. The passages in Vigolo v Bostin [2005] HCA 11; 221 CLR 191 which address the correct test to be applied make clear the multi-faceted approach necessary to be adopted in considering the question posed by s 59 of the Succession Act 2006 (NSW).
10. In Vigolo at [74] per Gummow and Hayne JJ and at [114] per Callinan and Heydon JJ, the Court said: 74. The correct approach to construction of the first or "jurisdictional" limb of provisions such as s 6(1) of the Act is that indicated in the joint judgment in Singer. Their Honours referred to the statement of Gibbs J in Goodman: "[T]he words 'adequate' and 'proper' are always relative. 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". Their Honours then added: "It is clear from this passage that his Honour was conveying that the primary judge was in essence making a value judgment in much the same way as a primary judge makes a sound discretionary judgment in personal injury cases when he or she assesses the quantum of damages say for pain and suffering, and for loss of amenities of life." … 114. The first of the indications is the use of the word "proper". It implies something beyond mere dollars and cents. Its use, it seems to us, invites consideration of all of the relevant surrounding circumstances and would entitle a court to have regard to a promise of the kind which was made here. Unfortunately for the appellant however, and as will appear, the making of that promise is not the only, and is indeed, far from a conclusive fact in the appellant's favour. The use of the word "proper" means that attention may be given, in deciding whether adequate provision has been made, to such matters as what used to be called the "station in life" of the parties and the expectations to which that has given rise, in other words reciprocal claims and duties based upon how the parties lived and might reasonably expect to have lived in the future. (citations omitted)
11. In argument the Court was taken to Alexander v Jansson [2010] NSWCA 176; 6 ASTLR 432. That case has a resonance in this appeal as it addresses both the scope of the dependency of the applicant in that case upon the deceased (being accommodation provided over a long period) and the relevance of the expressed "life-style desire" of the applicant, in that case to remain in the house which had been provided during the testator's lifetime.
12. In Alexander, Brereton J (with whom Basten JA and Handley AJA agreed) said at [18] and [20]: 18 "Proper maintenance" is not limited to the bare sustenance of a claimant, but requires consideration of the totality of the claimant's position in life including age, status, relationship with the deceased, financial circumstances, the environs to which he or she is accustomed, and mobility. … This moral obligation of testators, the enforcement of which is facilitated by the testators' family maintenance legislation, reflects an assumption inherent in our system of succession law that testators will exercise their testamentary freedom with moral responsibility, so as to make provision for those who would be regarded as having legitimate claims on their bounty - to the point that ability to appreciate this moral obligation has been said to be an essential element of testamentary capacity. 20 However, it is equally well established that the court will interfere with the dispositions in a will or under the rules of intestacy only to the extent necessary to make adequate provision for a claimant's proper maintenance, education and advancement in life. What was proper provision for Mrs Jansson in this case is informed both by the scope of her dependency upon the deceased (essentially, accommodation in the home on Gerraween), the representation by the deceased (that she would be able to do so), and her expressed life-style desire to remain there. Proper provision for her involved the ability to reside in the Gerraween home so long as she pleased, and if her circumstances changed or the whim so affected her to relocate elsewhere; and while she remained on Gerraween to continue her cattle grazing operations there. Her one-third interest in Gerraween, worth about $1 million, and her interests in the partnership and stock, together are more than ample to ensure that, should she have or wish to relocate to retirement accommodation elsewhere, she will be able to raise the necessary capital so to do. (italics added; citations omitted)
13. Having regard to the appellant's circumstances and expectations of life, and in particular his dependence upon the testator by reason of his intellectual and psychological limitations, the primary judge should have found that the provision in the will was not "adequate" for the "proper" maintenance of the appellant. What was adequate provision for the proper maintenance of the appellant in this case was principally informed by the scope of his dependency upon the testator reflected in the provision by him of long term accommodation at the Robert Street property and the appellant's strongly expressed desire to remain there.
14. Whilst no doubt there will be cases where a particular property bequeathed to a beneficiary may be treated for the purposes of the Succession Act as the functional equivalent of the sum which would be realised upon the sale of that property, this was not such a case. It was an error in the circumstances of this case to focus principally upon the adequacy in the appellant's hands of the sum of money which would be obtained by selling the Robert Street property and moving to more modest accommodation.
15. At the time of the testator's death, the appellant was approaching retirement-age. He had lived at the Robert Street property, which had been provided by the testator rent free, for over a decade. He had a very strongly held desire to remain living at the property.
16. The "proper" maintenance of the appellant required, in this case, consideration of the totality of the appellant's position in life and, in particular, the environment to which he was accustomed. Focussing on the question in this way makes it apparent that in leaving the Robert Street property to the appellant without sufficient finds for the maintenance and repair of that property has the result that adequate provision for the proper maintenance of the appellant under the testator's will was not made.
17. It is appropriate in those circumstances, and having regard to the size of the estate, to make the additional provision for the appellant proposed by Basten JA for the reasons his Honour gives.

Proposed amended notice of appeal

1. It became apparent at the hearing that the appellant (and perhaps the respondent) was proceeding on the misapprehension that if the appeal was successful, this Court would entertain further submissions on a separate occasion about the possible appointment of a trustee to administer any sum awarded to the appellant, pursuant to s 66 of the Succession Act.
2. No order was sought by the appellant in the notice of appeal raising this issue.
3. When the Court indicated that it did not propose to permit a bifurcated appeal of this kind, the appellant sought leave to file an amended notice of appeal to deal with the possible orders to be made under s 66 of the Succession Act. That amended notice of appeal sought the following orders (the underlined orders 2A, 3A and 3B comprise the amendments which were sought): 1. Appeal upheld 2. Orders made by Darke J on 30 July 2015 dismissing the Appellant's [172] and the order made as to costs on 16 September 2015 be set aside and discharged. 2A. Orders, sufficient cause having been shown, that the time for the making of the Appellant's application be extended until 18 June 2013, the date of the filing of the Summons. 3. An Order that the Appellant receive pursuant to s59(1) of the Succession Act 2006 (NSW) further provision out of the estate and/or notional estate of the deceased by way of a legacy from the estate of the deceased. 3A. An Order pursuant to s.66(1) of the Succession Act 2006 that any Order for such provision be paid to Brian Chan and Edward Chan, the sons of the Appellant, to be held on protective trust by them for the Appellant and to be applied to the use of the Appellant, inter alia, towards the costs of repairs, maintenance and other outgoings in relation to and in respect to the property at 10 Robert St, Gordon and otherwise for the Appellant's needs and the aforesaid trustees have such powers of investment in relation to such monies as are prescribed in Division 2 of Part 2 of the Trustee Act 1925 (NSW). 3B. Order the Appellant have liberty to apply to the judge in charge of the Family Provision List in the Equity Division for further orders, resulting from the judgments of this Court 4. Appellant's costs of the proceedings and of the Appeal be paid out of the estate and/or notional estate of the deceased. 5. Such further orders as the court deems fit.
4. The respondent did not object to the filing of the document but did oppose the making of Order 3A both as to the terms of the proposed trust and the identity of the proposed trustees. Further, the respondent pointed out that there was no evidence before the Court of the consent of the proposed trustees, Brian Chan and Edward Chan, to act as such.
5. In response, the appellant made a further oral application for amendment which I will treat as being to the effect that "In the alternative to Order 3A, an order remitting the matter to the Equity Division to consider any application for an order in the nature of Order 3A."
6. Whilst it is obviously unfortunate that this matter was not addressed in a timely way long prior to the hearing of the appeal, by reason of the appellant's intellectual and psychological limitations consideration should be given to preservation of the sum the Court is awarding and the establishment of a mechanism to ensure that those funds are used to restore the Robert Street property and not dissipated.
7. This Court, however, is not in a position to address the issues raised under s 66(1) of the Succession Act on the basis of the material presently before it. Further, there appears to be force in the submission of the respondent that the drafting of the order may require attention.
8. In these circumstances I agree with Basten JA that it is unnecessary to grant leave to the appellant to file the amended notice of appeal but that this Court should make orders remitting the matter to the Equity Division to consider any application for orders to address the consequential issues raised under s 66(1) of the Succession Act.
9. In addition I would also make order 2A in the amended notice, being an order that the primary judge said he would make but apparently overlooked. The making of this order is required to give effect to the decision of the primary judge to permit the appellant to bring his claim out of time. That decision was correct, for the reasons explained by Basten JA in dismissing the cross-appeal. No prejudice is occasioned to the respondent in the making of that order by this Court.
10. Accordingly, I agree with the orders proposed by Basten JA.

Endnotes

1. Beatrice McCleary v Metlik Investments Pty Limited; Beatrice McCleary v Benedict Chan; Clement Chan v Benedict Chan [2015] NSWSC 1043 ("Judgment").
2. Beatrice McCleary v Metlik Investments Pty Limited; Beatrice McCleary v Benedict Chan; Clement Chan v Benedict Chan (No 2) [2015] NSWSC 1361.
3. Succession Act, s 58(2).
4. Judgment at [169].
5. Judgment at [91].
6. Judgment at [91]-[105].
7. Judgment at [101].
8. Westmore, supplementary report, p 3.
9. Judgment at [103].
10. Westmore, supplementary report, p 2.
11. Judgment at [158].
12. Judgment at [91].
13. Judgment at [97].
14. Judgment at [98].
15. Judgment at [160].
16. Judgment at [161].
17. Succession Act, s 59(1).
18. Succession Act, s 59(1)(c).
19. Judgment at [159].
20. Succession Act, s 60(2)(d).
21. Judgment at [108].
22. Judgment at [109].
23. Judgment at [163].
24. Judgment at [164].
25. Judgment at [102].
26. Judgment at [161]; see [20] above.
27. (2005) 221 CLR 191; [2005] HCA 11 at [51].
28. (1944) 69 CLR 69 at 91-92. See also Re Leonard [1985] 2 NZLR 88 at 91.
29. Testator's Family Maintenance and Guardianship of Infants Act 1916 (NSW).
30. Vigolo at [114].
31. Vigolo at [115].
32. [1981] 2 NSWLR 532 at 541.
33. Judgment at [165].
34. Report, 10 August 2014, p 18.
35. Judgment at [170].
36. De Winter v Johnstone (unrep, NSWCA, 23 August 1995 at p 11) (Sheller JA). 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 August 2016