Chodyko v Southern

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

1329/01 LISA ANNETTE CHODYKO -V- ROSLYN BRENDA JILL SOUTHERN - ESTATE OF ARCHIBALD EDWARD ARTHUR SOUTHERN & ORS JUDGMENT 1 MASTER: These are proceedings under the Family Provision Act 1982. By summons filed on 6 February 2001, the plaintiff, Lisa Annette Chodyko (now Lisa Annette Bailey) claims an order for provision for her maintenance, education and advancement in life out of the estate of her late father, Archibald Edward Arthur Southern (to whom I shall refer as "the deceased"). 2 The deceased died on 12 September 2000, aged 59. He left a will dated 11 February 1997, probate whereof on 10 November 2000 was granted to Roslyn Brenda Jill Southern and Daphne Raelene Marie Jerabek, the executors named in the such will (who are the defendants to the present proceedings). 3 By that will the deceased left the entirety of his estate to his four sisters, being the two executors and Pauline Letitia Ann Heathcote and Margaret Diane Ruth Stuart. 4 The will contains the following statement, "I do not wish to make any provision for my daughter, Lisa Annette Chodyko". 5 The assets in the estate, as disclosed in the inventory of property, total $197,616. At the present time the net assets in the estate total $198,220. 6 It will be appreciated, however, that there must be taken into account the costs of the present proceedings. Those costs for both parties have been estimated to total about $67,000. There is also a small amount which must be paid in respect to administration expenses of the estate. 7 In consequence, therefore, when the costs of the present proceedings and any outstanding administration expenses are taken into account, there will be available for distribution an amount of about $128,800. 8 The plaintiff was born on 3 May 1971, and she is presently 30 years of age. She was the only child of the deceased. As such, she is an eligible person within paragraph (b) of the definition of that phrase contained in section 6(1) of the Family Provision Act. Accordingly, she has the standing to bring the present proceedings. 9 The plaintiff was born of the marriage of the deceased and the plaintiff's mother, now Lynette John. Mrs John, who separated from the deceased in 1973 and whose marriage to the deceased ended in divorce in 1974, is the only other eligible person in relation to the deceased. She is an eligible person within paragraph (c) of the foregoing definition. 10 An affidavit of Mrs John has been filed on behalf of the plaintiff, in which she says that she supports the present claim of the plaintiff. Mrs John herself makes no claim in respect to the estate of the deceased. 11 After the plaintiff's parents separated, the deceased had regular access to the plaintiff. In early 1984, when the plaintiff was aged 12, the deceased was charged with and pleaded guilty to several counts of carnal knowledge, assault with intent to carnally know and indecently assault a female under the age of 16 years. All of those offences related to acts that the deceased had committed upon the plaintiff. The deceased was sentenced to eight years imprisonment in respect to those offences, with a non-parole period of three years. 12 The relevance of those offences to the present proceedings is that the fact of those offences explains and justifies the lack of contact between the plaintiff and the deceased. It says much for the plaintiff that it was she who, nevertheless, initiated contact with the deceased in 1996. That contact involved about three meetings between the plaintiff and the deceased over a period of about eight months. 13 The nature of that contact, however, was such that the plaintiff decided that the contact should not continue. There can be no criticism of the plaintiff for making that decision, especially in the light of the evidence which has been placed before the Court by her treating psychiatrist, Dr Colin Kable. 14 During the period of the contact between the plaintiff and the deceased (which, it will be appreciated, was in the year preceding the making of the will) the deceased, at his suggestion and without any request by the plaintiff in that regard, advanced to her an amount of money to assist her in the purchase of a new motor vehicle. 15 The evidence does not disclose with clarity whether the amount advanced by the deceased was $19,000, as stated by the plaintiff and being a gift in that amount, or various amounts totalling a little over 38 000, as asserted on behalf of the defendants and consisting of both a gift and a loan. 16 It is not necessary for me to resolve that apparent uncertainty for the purposes of the present proceedings. What does emerge is that the deceased did give some financial assistance in respect, at least, to the acquisition of a motor vehicle for the plaintiff during the period in 1996 whilst the plaintiff was in contact with the deceased. 17 The plaintiff has been married twice. Her first marriage was to one Tony Chodyko in 1989. Of that marriage were born three children, being Amy (who is presently aged 11), Joshua (who is presently aged 9) and Monique (who is presently aged 8). Those three children have all remained in residence with the plaintiff since the plaintiff separated from her first husband in 1995. 18 The plaintiff, on 23 June 2001, married her present husband, Scott Raymond Bailey, the marriage of the plaintiff to her first husband having terminated in divorce before that time. The plaintiff and Mr Bailey had commenced to live together in 1997. Of her marriage to Mr Bailey there is one child, Stephany (now aged one year). 19 The four children of the plaintiff resided with her and Mr Bailey in the residence which they now conjointly own at 15 Ulaka Street, Charlestown. 20 The plaintiff is a registered nurse by profession. She is currently employed on a casual basis at the Lake Macquarie Shire Hospital. She usually works eight days a fortnight, for which period she receives a net amount of about $1,000. 21 The plaintiff said that over the recent Christmas/January period her working hours were less than the period of eight days a fortnight. 22 The plaintiff's husband is 33 years of age. He suffered a work related injury in June 1996 and was off work for a period of eighteen months, during which time he underwent a rehabilitation programme. When he resumed work his employer gave him light duties as a storeman. However, the location of that work was at Kurri Kurri, a distance from the residence at Charlestown, requiring driving of about 45 minutes. Mr Bailey found that that journey was exacerbating the problems which he had suffered to his back in the work related injury. 23 As a result of proceedings in the Compensation Court Mr Bailey received a judgment in a net amount of $70,000. Part of that amount was expended on medical expenses and on various repairs and renovations to the house property at 15 Ulaka Street. The balance of that amount was invested by Mr Bailey in a one quarter interest in the leasehold of a hotel at Carrington. 24 Mr Bailey is not involved in the conduct of that hotel but he receives an income from the hotel in an amount of $200 a week. 25 Since March 2001 Mr Bailey has not been employed. He voluntarily gave up his employment at that time on account of the exacerbation of his back injury, to which I have already referred. 26 He has since that time been in the position of a full time househusband and father to the family constituted by himself and the plaintiff and the four children. 27 The house property at 15 Ulaka Street, Charlestown has an estimated value of $185,000. There is a mortgage over that house property, which secures a present indebtedness to the Newcastle Permanent Building Society in an amount of a little over $106,000. The loan repayment in respect of that mortgage is in a fixed amount of $180 a week. 28 There is also a joint account held by the plaintiff and Mr Bailey in what is described as a linked account (which is linked to the amount that they owe under the mortgage). In that joint account the plaintiff and her husband are presently in credit to the Newcastle Permanent Building Society in an amount of about $16,400. 29 The house property which the plaintiff and her husband presently own was owned by Mr Bailey alone before he met the plaintiff. The property was transferred by him to himself and the plaintiff conjointly in December 2000. 30 Mr Bailey was cross-examined concerning his capacity to return to paid employment should he so desire. He agreed that he could do so, but pointed to the fact that until the youngest child is old enough to attend preschool, he needs to be at home to care for her whilst the plaintiff is absent at work in her nursing profession. 31 Further, it will be necessary for arrangements to be made, if Mr Bailey returns to work, for the taking of the children, especially the youngest child, to school or preschool and for collecting the children afterwards. 32 In respect to the children, it should also be recorded that the plaintiff's second child, Joshua, suffers from a condition known as Aspergers Syndrome which is a form of autism. On this account Joshua receives assistance from school from a special teacher two days a week. There is a part-carer's pension paid to Mr Bailey in respect to his care of Joshua. That part-carer's pension is in an amount of $83 a fortnight. 33 The plaintiff and her husband have expenses which total about $1,145 a week. There is an overdraft limit of $28,000 upon the joint bank account. It has been necessary for Mr Bailey to seek and to obtain an advance on his interest in the hotel business to ensure that the joint account does not exceed its overdraft limit. 34 The plaintiff and her husband own, apart from their house property, two motor vehicles, being a 1998 Toyota Tarago vehicle owned by the plaintiff (to which she ascribes an estimated value of $26,000) and a 1996 Ford Falcon motor vehicle owned by Mr Bailey (to which he ascribes an estimated value of $11,000). 35 The only other significant asset owned by either the plaintiff or her husband is Mr Bailey's one quarter interest in the hotel at Carrington. He estimates that one quarter interest to be worth $60,000. 36 The plaintiff has an indebtedness of $10,000 on account of HECS, as a result of her tertiary training to become qualified as a registered nurse. 37 The plaintiff, in November 2000, received from her former husband the sum of $102 000 by way of a deferred property settlement under orders from the Family Court of Australia. Evidence was given during the course of her cross-examination at today's hearing as to the way in which that amount of $102 000 was disbursed. A significant part of that sum, being about $50 000, was spent on renovations to the house property at Charlestown. An amount of $14,000 was spent on the wedding of the plaintiff and Mr Bailey. Other amounts were spent on the purchase of the two motor vehicles to which I have referred and the costs of the plaintiff's Family Law proceedings. 38 According to the plaintiff, her former husband has a legal obligation to pay maintenance in respect of his three children. Nevertheless, it would appear that the last payment was made by her former husband in October 2001 and that he presently owes arrears by way of maintenance in an amount in excess of $5,000. 39 No evidence was placed before the Court as to what arrangements, if any, the plaintiff has put in train to obtain payment of those arrears from her former husband. 40 The costs of the Family Law proceedings to which the plaintiff referred were in an amount of about $20,000. 41 Evidence was placed before the Court by each of the four beneficiaries named in the will of the deceased. It is a fair summary of that evidence that none of those four ladies is in what might be described as affluent financial circumstances. 42 Indeed, in the case of at least two of them, their financial circumstances could be described as poor. 43 I have already observed that the plaintiff and her mother are the only eligible persons in relation to the deceased. The four named beneficiaries are not eligible persons in relation to the deceased. Nevertheless, the Court must recognise the fact that they are the chosen objects of the testamentary beneficence of the deceased. In considering the claim of the plaintiff, the circumstances of those four beneficiaries and their competing claims upon the bounty of the deceased must be taken into account. 44 I have already observed that the net distributable estate will be in an amount of about $128 800. It is quite apparent that the financial and material circumstances of the plaintiff are such that she is entitled to receive a significant benefit out of the estate of the deceased. 45 The essential question which I have had to consider is the effect upon that entitlement of what is asserted by the defendants to be the competing claims of the four beneficiaries. 46 It has been submitted on behalf of the plaintiff that she should receive the entirety of the estate of the deceased. The defendants, through their Counsel, recognise that some order for provision will be made in favour of the plaintiff. But it is submitted on their behalf that that order should be such as will enable some financial benefit to pass to the four beneficiaries. 47 The problem in the instant case is that the estate is a small one, originally less than $200 000 and after allowance is made for the costs to which I have referred, consists of a distributable estate of about $129 000. 48 I consider that the plaintiff has established an entitlement to receive a benefit which will firstly enable herself and her husband to discharge the mortgage on the house property and thus to terminate the mortgage payments of $180 a week; and secondly, to give to the plaintiff some additional benefit which will go at least part of the way to meet the shortfall between the total income of the plaintiff and her husband and their outgoings and expenses. 49 Were the estate to have been larger, I would have ordered that the plaintiff receive a legacy in a specified amount, so that there would be some balance then remaining for the four named beneficiaries. 50 Since the estate is such a small one, I do not consider that I can adopt that course. It seems to me inevitable that the plaintiff must receive the entirety of the estate of the deceased and I propose so to order. 51 I make the following orders:

(1). I order that the plaintiff receive the entirety of the estate of the late Archibald Edward Arthur Southern ("the deceased") absolutely.

(2). I order that the costs of the plaintiff on the party and party basis and the costs of the defendants on the indemnity basis be paid out of the estate of the deceased. 52 The exhibits may be returned.

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