Chong v Mo

Supreme Court of NSW|2009-11-04|Before: Mr J

HEARING DATE(S) : 29, 30 October and 4 November 2009

I order that, in lieu of the benefit given to him under the will of the late Nelson Yi Hong Chong ("the Deceased"), the Plaintiff receive a legacy in the sum of $100,000. 2. I order that the sum of $60,000, being part of the aforesaid legacy, not bear interest if paid on or before 1 June 2010, and if not so paid, bear interest from that date at the rates prescribed for interest upon unpaid legacies by the Probate and Administration Act 1898. 3. I order that the home unit situate at Albert Road, Strathfield be designated notional estate of the Deceased, to the extent of the value of one half of such home unit. DECISION : 4. I order that so much of the foregoing legacy of $100,000 as has not already been paid, be paid out of the notional estate of the Deceased. 5. I order that, subject to order 7 hereof, the costs of the Plaintiff on the party and party basis and the costs of the Defendant on the indemnity basis be paid out of the notional estate of the Deceased. 6. I order that the notice of motion filed by the Defendant on 29 April 2009 be dismissed. 7. I order that the Defendant pay the costs of the First Plaintiff and of Benjamin Barrak and of Barrak Lawyers of the aforesaid notice of motion filed by the Defendant on 29 April 2009, and that such costs be paid by the Defendant personally and that she not be entitled to have recourse to the estate and/or the notional estate of the Deceased for the payment or recoupment of such costs or of her own costs of that notice of motion. 8. The exhibits may be returned.

CATCHWORDS : SUCCESSION - family provision - claim by adult son - financial and material circumstances of Plaintiff - whether Plaintiff has been left without adequate provision for his proper maintenance - competing claim of Defendant, who is de facto widow of Deceased - whether Plaintiff is a person under legal incapacity - whether Plaintiff is incapable of managing his affairs - proceedings instituted without a tutor for Plaintiff - whether tutor necessary - application by Defendant that Plaintiff's solicitor should personally pay costs - whether solicitor acted without reasonable cause.

CASES CITED : Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201 Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 19

Mark Byron Chong (First Plaintiff) PARTIES : Eugenia Chong (Second Plaintiff) Qiu Miao Mo (Defendant)

Mr K. Rollinson (First Plaintiff) COUNSEL : Mr M. Lawson (Second Plaintiff) Mr J. Armfield (Defendant)

SOLICITORS : Barrak Lawyers (Plaintiffs) Jeffery & Jeffery (Defendants)

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

3363 of 2008 MARK BYRON CHONG and ANOR -v- QIU MIAO MO JUDGMENT 1 HIS HONOUR: These are proceedings under the Family Provision Act 1982. 2 The proceedings were instituted by summons filed on 20 June 2008 by Mark Byron Chong. By that summons the Plaintiff sought substantively an order for provision for his maintenance and advancement in life out of the estate and/or notional estate of his late father, Dr Nelson Yi Hong Chong (to whom I shall refer as "the Deceased"). 3 Subsequently, on 19 December 2008, an amended summons was filed. By that amended summons there was joined an additional Plaintiff, being Eugenia Chong, the former wife of the Deceased (who was referred to in that document as the Second Plaintiff). Eugenia Chong is the mother of Mark Byron Chong. 4 By the amended summons the Plaintiffs sought substantively an order that provision be made for their maintenance and advancement in life out of the estate and/or notional estate of the Deceased, and an order that the time for the making of the foregoing application of the Second Plaintiff, Eugenia Chong, be extended up to and including the date of the filing of the amended summons. 5 The Deceased died on 20 December 2006, aged 73 years. He left a will dated 13 December 2006, probate whereof was on 13 June 2007 granted to Qiu Miao Mo, one of the two executors named therein (who is the Defendant to the present proceedings). The other executor renounced probate. 6 By his will the Deceased gave a legacy of $40,000 to the First Plaintiff and gave the residue of his estate to the Defendant. He made no provision for the Second Plaintiff, from whom he had been divorced on 21 November 1993. 7 A bank cheque representing the foregoing legacy of the $40,000, together with interest in an amount of $647, was sent to the Plaintiff on 24 October 2008. 8 The inventory of property discloses the following assets, together with the respective estimated values thereof: Dental surgery located at Bankstown, goodwill and equipment $25,000 Dental surgery located at Epping, goodwill and equipment $35,000 Nissan Pulsar motor vehicle $3,000 Account with National Bank of Australia $500 Half share as tenant in common in equal shares with Defendant in home unit situate at Albert Road, Strathfield $200,000 Policy (or shares) in IAG Limited $4,400 9 The liabilities of the estate (consisting of funeral expenses ($38,300); burial plot ($9,235); stone mason ($9,300); flowers ($1,000)) came to a total of $57,835. Legal fees and expenses in obtaining the grant of probate and in the administration of the estate totalled $7,448. 10 According to the Defendant, the likely value of the net estate of the Deceased is a little over $219,000. 11 Since the death of the Deceased the Defendant has continued to operate the two dental surgeries, engaging dentists on contract to perform professional work therein, and the Defendant herself continuing to manage the surgeries and work as the dental nurse for the practice. The Defendant also sold, for $900, the Nissan motor vehicle (to which she had earlier attributed an estimated value of $3,000). 12 The Defendant has used the moneys in the Deceased's bank account, as well as an income tax refund of $4,347 which she subsequently received, for the purpose of conducting the two dental surgeries. 13 The Defendant has also transferred into her own name the Deceased's half interest in the Strathfield residential property, which was the matrimonial home of the Deceased and the Defendant for the last seven years of the Deceased's life. 14 In calculating the value of the estate available for distribution the costs of the present proceedings must be taken into account, since in proceedings under the Family Provision Act, plaintiffs, if successful in their claims, will normally be entitled to an order that their costs be paid out of the estate, whilst defendant executors, irrespective of the outcome of the proceedings, will normally be entitled to an order that their costs be paid out of the estate. 15 It has been estimated on the part of the First Plaintiff that his costs will total in the range of $44,000 to $51,000. 16 No affidavit evidence as to the Defendant's costs appears to have been filed. The absence of such an affidavit was adverted to on the morning of the second day of the hearing, 30 October 2009. It was suggested at that time that such a costs affidavit had been filed on the first day of the hearing, 29 October 2009. No such affidavit was served upon the Plaintiff or has reached the Court file. 17 It is quite apparent, however, that this small estate will be further depleted by the costs of the present proceedings. As I have already recorded, it was the Defendant's evidence that the likely value of the net estate would be a little over $219,000. If the Plaintiff's costs be in the range of $44,000 to $51,000, it is unlikely that the Defendant's costs will be within a lesser range. It is obvious that the actual estate will not be sufficient to meet even the costs of the proceedings. The only significant asset, being the Deceased's half interest in the Strathfield property, has already been transferred to the Defendant. If the Plaintiff establishes an entitlement to an order for provision, it will be necessary for that half interest to be designated notional estate of the Deceased, and for such provision (as well as any costs to which the Plaintiff might become entitled) to be payable out of such notional estate of the Deceased. 18 Regarding the costs of the proceedings, it is here relevant to observe that, in circumstances which will emerge later in this judgment, the Defendant has made an application that the Defendant's costs of the proceedings either in their entirety or up to certain specified dates should, in any event, be borne not by the estate of the Deceased or (as I understand it) by either of the Plaintiffs personally, but by the solicitor for the Plaintiffs personally, or by the legal firm of which he is the principal. 19 It should also here be recorded that about a month before his death the Deceased gave to the Defendant a cheque for $50,000, which she deposited in a term deposit with the National Australia Bank. On 11 December 2006 (that being only nine days before the Deceased's death, and being only two days before the Deceased made his last will) the Deceased gave to the Defendant a cheque for $20,000, which she also deposited in her account with the National Australia Bank. According to the Defendant, those two amounts of money were used by her in carrying on the dental practices and in paying business expenses, as well as in meeting the funeral expenses of the Deceased. 20 Also before his death the Deceased transferred to the Defendant a Subaru Impressa motor car, which, according to the Defendant, was their family car and which had been purchased conjointly by herself and the Deceased out of their joint funds. The Defendant said that that motor car was involved in an accident after the death of the Deceased, and that she subsequently, in about April 2008, received from the insurer a cheque for $21,850 in respect to that vehicle. 21 The Second Defendant participated in the present proceedings by her tutor, Roseanne Markham (whose consent to act as such had been filed on 5 June 2009). At the hearing each Plaintiff was represented by separate Counsel, each of whom was instructed by the same firm of solicitors. At the outset of the hearing it was announced that, subject to the approval of the Court, the claim of the Second Plaintiff had been resolved, and that short minutes of order had been prepared to give effect to that resolution. It should here be recorded that it was the position of Counsel who appeared for the Second Plaintiff that, an account of her psychiatric problems (she having suffered from schizophrenia), the approval of the Court was required, even though the substantive order resolving her claim was an order for the dismissal of her proceedings. That position of Counsel for the Second Plaintiff accorded with the position of her solicitor in regard to such a settlement of her proceedings, to which I will make further reference later in these reasons for judgment. 22 On the first day of the hearing, after receiving submissions on behalf of the Second Plaintiff and of the Defendant, I made orders as in paragraphs 1, 3 and 5 in the Short Minutes of Order dated 29 October 2009, signed by Counsel for the respective parties, initialled by me and filed in Court that day; and I noted paragraphs 2 and 4 in the Short Minutes. 23 The proceedings then continued in respect to the claim of the First Plaintiff, Mark Byron Chong (to whom I shall hereafter usually refer as "the Plaintiff"). 24 The proceedings were instituted by that Plaintiff without the intervention of a tutor. Subsequently, the consent of Dr Edmond Kwan to act as tutor for the Plaintiff was filed on 27 May 2009. 25 The Plaintiff (who was born in 1971 and is now aged 38) is the only child of the Deceased, and was born to the marriage of the Deceased and Eugenia Chong (the Second Plaintiff in the present proceedings). 26 The Plaintiff is said to suffer from psychiatric problems. His parents separated in 1983, when he was aged about twelve. He then resided with his father until the age of about 17. At about that time he was diagnosed as having a history of schizotypal personality development with evidence of a recent deterioration of a schizophrenic nature. 27 The Plaintiff left school in year 11, and, although he subsequently attended TAFE, he did no ever attain his HSC. He has been in paid employment for only about 12 months in his life. The Plaintiff resides alone in Department of Housing accommodation at Marrickville (for which he has to meet a rental deficiency of almost $68 a week, that being the difference between rent of $215 a week and a rent subsidy of $147 a week). His only income is a disability pension, presently in an amount of $671 a fortnight. He has been in receipt of a disability pension since about 1993. The Plaintiff has no assets and has very little in the way of possessions. His lifestyle is modest in the extreme. His chief social contact is with Dr Kwan and a religious group with which Dr Kwan is associated. The Plaintiff does voluntary work with that group. 28 In the affidavit evidence filed on behalf of the Defendant, both in the substantive proceedings and in support of the Defendant's notice of motion seeking costs, an assertion was made that the Plaintiff was not the son of the Deceased. The only evidence placed before the Court in support of that assertion was statements alleged by the Defendant to have been made by the Deceased. However, there was a substantial quantity of evidence that the Deceased himself always acknowledged the Plaintiff as his son, and referred to him as such. He described the Plaintiff as his son, not only in his final will, 13 December 2006, but also in two earlier wills dated respectively 15 November 2006 and 23 November 2006, by each of which the Deceased made provision for the Plaintiff. Further, there was direct evidence from the Plaintiff's mother that the Deceased was the Plaintiff's father. The Plaintiff's birth certificate discloses the Deceased as his father. 29 The Plaintiff had a close and affectionate relationship with his father. After his parents separated in about 1983 the Plaintiff and the Deceased resided together until about 1988 and thereafter the Plaintiff and the Deceased were in regular communication, at least until 2000. The Deceased appears to have been protective and supportive of the Plaintiff throughout his lifetime. 30 At various times the Deceased provided the Plaintiff with motor vehicles. The Deceased appears, within the limits of his own financial circumstances, to have treated the Plaintiff generously. At times the Plaintiff assisted his father in the dental practice, receiving pocket money in return for his help. 31 Ultimately, the Defendant did not at the hearing persist in this allegation that the Plaintiff was not the son of the Deceased. If the Defendant was not in a position to present admissible and compelling evidence on such a significant matter, she should not have disputed the status of the Plaintiff as the Deceased's son, in the first place. 32 The claim of the Plaintiff must be approached in the light of any competing claims upon the testamentary bounty of the Deceased. Since the claim of the Second Plaintiff has been resolved by consent of the parties, the only competing claim which the Court must consider is that of the Defendant herself. She is the chief chosen object of the testamentary beneficence of the Deceased. Apart from the legacy of $40,000 to the Plaintiff, the Defendant under the will receives the entirety of the estate of the Deceased. 33 The Defendant was born in 1955, and is now aged 54 years. According to her affidavit evidence, her health is not good, as she suffers from hepatitis B. That disease affects her liver and makes her tired and unwell from time to time. She receives regular medical check-ups, in order to monitor that condition. 34 The Defendant met the Deceased in about 1991, and they entered into a de facto relationship in 1993. They lived together from then until the death of the Deceased in December 2006. From the time when they met until the death of the Deceased the Defendant worked in his dentistry practice, as practice manager, receptionist, and dental nurse. 35 The Defendant has the following assets.

Home unit at Albert Road, Strathfield, which was previously the matrimonial home of herself and Deceased.

That property was purchased by the Defendant and the Deceased in about May 1999 for about $270,000 and was funded by a housing loan of $216,000, secured by mortgage. The loan was paid off in about June 2004. Shortly before his death, the Deceased unilaterally severed the joint tenancy, and the property was thereupon held by the Deceased and the Defendant as tenants in common in equal shares. Under the terms of his will the Deceased's interest in that house property passed to the Defendant. On 28 June 2007 the Defendant became the registered proprietor of the entirety of that property. - House property at Waitara, valued at about $690,000.

That property was purchased by the Defendant in about June 2006, for $690,000. The Defendant contributed about $50,000 towards the purchase price, and her parents and a cousin contributed a further sum of about $120,000. The Defendant borrowed $550,000 from the ANZ Bank. The property is currently mortgaged to the ANZ Bank, the amount presently outstanding being about $262,000. Monthly repayments on that mortgage are $3,857. The kinsfolk of the Defendant who reside in that property contribute towards the mortgage repayments, and also towards council and water rates, usually in amounts of $3,000 and $3,500 a month. - One quarter interest in a property at Wahroonga.

That property is presently held in the names of the Defendant, her sister and her parents (the Defendant having a one fourth interest therein). The Defendant did not contribute towards the purchase price, which (in an amount of $315,000) was paid by her mother in about June 1997. The Defendant's sister resides in the property, and the Defendant is not aware of its present value.

Savings in National Australia Bank, in an amount of about $15,400.

Business Account for dental practices (which in August 2008 was in an amount of $17,374). - Mitsubishi Lancer motor vehicle, estimated value of $10,000. - Toyota MR2 2005 motor vehicle, estimated value $25,000. Although registered in the Defendant's name, this vehicle, according to the Defendant, was purchased by the Deceased and herself for the Defendant's daughter in 2005.

Household furniture, personal effects and jewellery, estimated value $10,000.

Superannuation entitlement as at 30 June 2008, $37,883. Total (excluding the residential property at Waitara) $1,285,657. 36 The only liability of the Defendant is the mortgage to the ANZ Bank over the Waitara property, currently in an amount of $262,000. 37 The Defendant provided a copy of her income tax return for the year ended June 2007, disclosing a taxable income of $18,155. 38 The Defendant provided details of her outgoings (apart from those in respect to the dental practices), in amounts totalling $3,963 a month. 39 According to the Defendant, the finances of herself and the Deceased were intermingled. They had joint private health cover. They spent nearly all their time together, both at work and at home. 40 The Defendant's daughter, Yi Fan (Eva) Ou, who was aged about nine or ten when the Defendant and the Deceased entered into a de facto relationship, resided with them for an unspecified number of years. 41 According to the Defendant, the relationship between the Plaintiff and his father was not a particularly good one, and their contact was not as regular or as frequent as the Plaintiff asserted. 42 It is in the light of the foregoing facts and circumstances that the Court must proceed to a consideration of the claim of the Plaintiff. 43 I have had the benefit of receiving a written outline of submissions from Counsel for the respective parties, together with a chronology from Counsel for the Defendant. Those documents will be retained in the Court file. 44 The Plaintiff as the son the Deceased is an eligible person within paragraph (b) of the definition of that phrase contained in section 6(1) of the Family Provision Act. As such he has the standing to bring the present proceedings. The only other eligible persons in relation to the Deceased are the Defendant (who as the de facto widow of the Deceased is an eligible person within paragraph (a) of the foregoing definition), the Second Plaintiff (who as the former wife of the Deceased is an eligible person within paragraph (c) of the foregoing definition) and the Defendant's daughter, Ms Eva Ou (who is an eligible person within paragraph (d) of the foregoing definition). I have already recorded that the claim of the Second Plaintiff has been disposed of by consent. 45 Although served with a notice of claim, Ms Ou has not made any claim against the estate of the Deceased.

46 In carrying out the first stage in the two-stage process identified by the High Court of Australia in Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201 at 208 - 210 (the correctness of which test was affirmed by the High Court in Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191) the Court must determine whether in consequence of the provisions of the will of a testator the applicant has been left without adequate provision for his or her proper maintenance.

47 The High Court in Singer v Berghouse (at 209 - 210) said that the determination of the first stage 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.

48 There can be no doubt that the Plaintiff, suffering psychiatric problems, subsisting alone in very basic accommodation provided by the Department of Housing, having as his sole income a disability pension, and living in the most frugal of circumstances (with little in the way of furniture, furnishings or possessions (apart from technical books and DVDs) and, through financial exigency, hardly using any electrical appliances, has been left without adequate provision for his proper maintenance. 49 Although the estate is a small one, a legacy of $40,000 is not adequate to provide even the basic necessities of life to the Plaintiff. It is appropriate that he should receive a fund which will enable him to eat adequately, acquire some new appliances for his residence and new clothing, ensure that he can use electricity when he needs to, and provide him with a fund to meet unexpected contingencies (especially such as may confront a person in the materially and socially vulnerable situation of the Plaintiff). 50 I am satisfied that the Plaintiff has established an entitlement to receive from the estate of the Deceased a legacy, not in the sum of $40,000, but in the sum of $100,000. 51 The financial and material circumstances of the Defendant (who has total net assets, excluding the Waitara property, well in excess of $1,000,000) are such that her competing claim upon the testamentary bounty of the Deceased, which was recognised by the Deceased himself by the terms of the will, cannot have the effect of reducing, let alone extinguishing, an order for provision of the foregoing nature, an entitlement to which I am satisfied the Plaintiff has otherwise established. 52 The substantial asset in the estate, being the one half interest as tenant in common in the Strathfield home unit, has already been transferred to the Defendant. The other assets in the estate are not sufficient to meet the legacy to which the Plaintiff has established an entitlement (and probably not sufficient to meet even the costs of the proceedings). Accordingly, it is appropriate that that interest of the Defendant in the home unit be designated notional estate of the Deceased, and that the provision in favour of the Plaintiff should be made out of such notional estate. 53 I have already referred to the application of the Defendant that the solicitor for the Plaintiffs (or his firm) should pay all or some of the costs of the proceedings. In that regard it is the complaint of the Defendant that the solicitor for the Plaintiffs instituted the present proceedings without the appointment of a tutor for the First Plaintiff and that such a tutor was subsequently appointed only on 27 May 2009 (that being eleven months after the institution of the proceedings), and that it was only 4 June 2009 (more than five months after she was joined as Second Plaintiff) that a tutor was appointed for the Second Plaintiff. 54 By notice of motion filed on 29 April 2009 the Defendant seeks an order that the proceedings be dismissed and that the solicitor for the Plaintiffs, or alternatively the firm of which that solicitor is the principal, should personally pay the costs of the Defendant of the proceedings. 55 That notice of motion came on before Justice Slattery, sitting as Duty Judge in the Equity Division, on 2 July 2009. His Honour adjourned the motion, directing that it be heard at the same time as the substantive proceedings fixed to be heard on 29 October 2009. His Honour expressed the view that, "[t]o avoid the possibility of inconsistent judgments in respect of those important and potentially difficult issues [regarding the mental state of one or both of the Plaintiffs], it is appropriate that the defendant's motion be heard by the same judicial officer who is hearing all issues at the main trial." 56 At the hearing of the substantive proceedings the Defendant no longer sought an order in the terms of paragraph 1 in the notice of motion, that being an order that the proceedings be dismissed, and confined her application upon the notice of motion to an order that the solicitor for the Plaintiffs, or alternatively the firm of which that solicitor is the principal, pay the costs of the Defendant of the proceedings before the appointment of the tutors (or, alternatively, the costs of the mediation held on 23 March 2009 and of the notice of motion). 57 Further written outlines of submissions were provided by Counsel for the respective parties regarding this application for costs. Those documents will be retained in the Court file. 58 Consequent upon a direction made in that regard by Justice Nicholas on 5 June 2009, the Defendant by letter of 15 June 2009 set forth the grounds upon which she made the foregoing costs application. Those grounds are premised upon the assertion of the Defendant that at a time no later than the mediation held on 23 March 2009, and continuing to the date of the letter itself (15 June 2009) each of the Plaintiffs were (sic) persons under a legal incapacity and required a tutor. 59 By section 3(1) of the Civil Procedure Act 2005 the phrase "person under legal incapacity": means any person who is under a legal incapacity in relation to the conduct of legal proceedings (other than an incapacity arising under section 4 of the Felons (Civil Proceedings) Act 1981) and, in particular, includes:

(a) a child under the age of 18 years, and (b) an involuntary patient, a forensic patient or a correctional patient within the meaning of the Mental Health Act 2007, and

(d) a protected person within the meaning of the NSW Trustee and Guardian Act 2009, and

(e) an incommunicate person, being a person who has such a physical or mental disability that he or she is unable to receive communications, or express his or her will, with respect to his or her property or affairs. 60 Neither Plaintiff falls within any of the specified categories set forth in the foregoing paragraphs (a) to (e). 61 Accordingly, it is for the Defendant to establish that either or both of the Plaintiffs is (or was throughout the period relied upon by the Defendant) "under a legal incapacity in relation to the conduct of legal proceedings". 62 Part 7, Division 4 of the Uniform Civil Procedure Rules 2005 provides, in rule 7.13, as follows: In this Division, person under legal incapacity includes a person who is incapable of managing his or her affairs.

63 In the instant case, there was placed before the Court substantial documentary evidence concerning the Second Plaintiff's mental problems and her periods of hospitalisation as a consequence thereof in the 1980s (Exhibit A), and two reports from psychiatrists, dated respectively 8 September 1988 and 16 December 1988, relating to the First Plaintiff (Exhibit 9). 64 Each of the Plaintiffs provided evidence by affidavit, and each was cross-examined during the course of the hearing. 65 The Defendant did not place before the Court any medical evidence in support of her contention that each Plaintiff at the time when the proceedings were instituted (or at any time thereafter) was a person under legal incapacity, or was a person who was incapable of managing his or her affairs. 66 The Defendant adopted the approach that the mere fact that a tutor had been appointed for each Plaintiff was, of itself, sufficient evidence that that Plaintiff was a person under legal incapacity. 67 Mr Benjamin Barrak, the solicitor for the Plaintiffs, who has had the carriage of the matter throughout the proceedings, provided evidence by way of affidavit, and was cross-examined at the hearing. Mr Barrak was aware that the First Plaintiff had some sort of mental illness, but he satisfied himself that the First Plaintiff was capable of giving instructions. He said that he had had many conferences with the First Plaintiff, and his observations were that the First Plaintiff was able to answer all of Mr Barrak's questions satisfactorily. Mr Barrak was aware, by early 2009, that the First Plaintif had been diagnosed as having schizophrenia from the late 1970s, and that he had been in receipt of a disability pension since at least 1993. However, he said that the First Plaintiff was able to answer each and every one of his questions, and that, as far as he was concerned, the First Plaintiff was perfectly capable of giving clear and lucid instructions. 68 It was the evidence of Mr Barrak that he considered that the Plaintiff was competent to give instructions for the institution of the proceedings, although Mr Barrak considered that any resolution of the proceedings by consent would probably require the approval of the Court. 69 It is also of relevance that the proceedings were instituted on the very last day before the expiry of the prescribed period of eighteen months from the death of the Deceased, and that the claim of the Second Plaintiff was made after the expiry of that period (necessitating an application for an extension of the time in which to make her claim). 70 The fact that a tutor was subsequently appointed (that appointment being made from an abundance of caution on the part of the Plaintiff's solicitor) is not determinative of the question whether the proceedings should have been instituted by the Plaintiff through a tutor. 71 Regarding the Second Plaintiff, Mr Barrak said that he was aware that in the late 1970s she had been admitted to various psychiatric institutions on numerous occasions, and that she also had suffered from schizophrenia. However, Mr Barrak considered that at his meetings with her she was able to give clear, concise and lucid instructions. He said that he had also made enquiries of her doctor, a Dr Hor, who informed Mr Barrak that she was perfectly capable of giving instructions. 72 Mr Barrak said that he himself had had personal experience of persons suffering schizophrenia, and was aware that the condition is what he referred to as cyclical and that those persons may suffer what is referred to as a psychotic episode. Mr Barrak had visited the Second Plaintiff in her Housing Commission [presumably, Department of Housing] accommodation, where she lives on her own, and independently. 73 Mr Barrak said that it was from an abundance of caution that he arranged that there should be a tutor appointed for each of the two Plaintiffs. 74 The evidence does not satisfy me that either of the Plaintiffs is a person "who is incapable of managing his or her affairs". I have already recorded that none of the particular instances of legal incapacity referred to in the definition of "person under legal incapacity" in section 3 of the Uniform Civil Procedure Act has application to either of the Plaintiffs. 75 Since I am not satisfied that either Plaintiff is a person who is incapable of managing his or her affairs (rule 7.13 of the Uniform Civil Procedure Rules), I also am not satisfied that either Plaintiff is a person under a legal incapacity in relation to the conduct of legal proceedings (in particular, in relation to the conduct of the present legal proceedings). 76 Therefore, it probably was not necessary for either Plaintiff to have a tutor. Nevertheless, I consider that the decision of Mr Barrak to have a tutor appointed for each Plaintiff was prudent and responsible conduct on his part. It was taken for an abundance of caution, and was in no way determinative of whether each of the Plaintiffs is or, at the time of the institution of the proceedings, was a person under legal incapacity. 77 The conclusion which I have just expressed is relevant to the ground upon which the Defendant submits that Mr Barrak (or his firm, Barrak Lawyers) should personally pay the costs of the proceedings up to the date of the respective appointments of tutors, or, at least the costs of the mediation and of the notice of motion filed by the Defendant on 29 April 2009. 78 That asserted liability of Mr Barrak is grounded upon section 99(1) of the Civil Procedure Act, which provides, relevantly, This section applies if it appears to the court that costs have been incurred: (a) …

(b) improperly, or without reasonable cause, in circumstances for which a legal practitioner is responsible. 79 The Defendant did not assert that the costs which she was claiming against Mr Barrak had been incurred improperly, only that they had been incurred without reasonable cause. 80 It is relevant to the question of whether the costs which are presently being sought by the Defendant have been incurred "without reasonable cause", that each of the Plaintiffs gave oral evidence along the lines of the evidence set forth in their respective affidavits. It was not suggested to either Plaintiff in cross-examination that he or she was not the source of the contents of those affidavits, or that he or she did not understand what Mr Barrak had been doing on behalf of each of the Plaintiffs. 81 To the extent that the complaint of the Defendant is that neither Plaintiff was present at the mediation, that is a complaint for which Mr Barrak cannot be held responsible. I am satisfied that he informed each of his clients of the necessity that he and she be in attendance at the mediation on 23 March 2009. However, neither Plaintiff remembered Mr Barrak doing so. It is quite possible that each Plaintiff could have forgotten that information from Mr Barrak, especially since the Second Plaintiff went into hospital some days before 23 March, and did not thereupon inform Mr Barrak where she was at the time of the mediation. It was only afterwards that he learnt that she had been in hospital at the time of the mediation Mr Barrak experiences considerable practical difficulties in communicating with the Second Plaintiff. She does not maintain telephonic means of communication, or have means of transport, and it is necessary for Mr Barrak to communicate with her by visiting her personally at pre-arranged times. The absence of the Plaintiffs from mediation was not Mr Barrak's fault. 82 There was placed before the Court a considerable quantity of correspondence between the solicitors for the respective parties both regarding the necessity for the appointment of a tutor for each Plaintiff and regarding the arrangements for the mediation and the absence therefrom of each of the First Plaintiff and his mother (who, it will be appreciated was at that time also a party to the proceedings). 83 Whilst it was not possible for the case to settle at the mediation unless the Plaintiffs had been present, it does not appear to be suggested by the Defendant that there was a serious and genuine prospect of settlement taking place at the mediation, which was thwarted by the absence of the Plaintiffs. But, in any event, as I have already observed, Mr Barrak was not in any way responsible for the absence of the Plaintiffs from the mediation. He did everything that could have been expected of him to ensure that each Plaintiff was in attendance. 84 Even if there had been a tutor for each Plaintiff, and that tutor had been present at the mediation, it would have been well nigh impossible for any binding agreement to have been entered into between the parties at that mediation in the absence of the Plaintiffs. Whilst the absence of one or both of the Plaintiffs might possibly have resulted in the mediation being fruitless, it was the failure of the Plaintiffs to be present at the mediation - not the fact that at that time neither Plaintiff had a tutor - which had that result. 85 I am in no way satisfied that costs have been incurred without reasonable cause by Mr Barrak or his firm. 86 I summarise as follows my foregoing views concerning the application of the Defendant for certain costs to be paid by the solicitor for the Plaintiffs. 87 I am not satisfied that either Plaintiff was at the time of the institution of the proceedings (or thereafter, up to the hearing) a person who was under a legal incapacity in relation to the conduct of legal proceedings, or was a person who was incapable of managing his or her affairs. The appointment of a tutor for each Plaintiff was not determinative of whether each Plaintiff was under such a legal incapacity. Such an appointment was made by the solicitor for the Plaintiffs from an abundance of caution, and probably was not necessary. I am not satisfied that in commencing the proceedings Mr Barrak was acting improperly or without reasonable cause. 88 Neither am I in any way satisfied that the absence, at the commencement of the proceedings or for any period thereafter, of a tutor for either Plaintiff has increased the costs of the Defendant. Each Plaintiff, after a tutor had been appointed for that Plaintiff, adopted what had been done by Mr Barrak in the preparation of the proceedings. In this regard the instant case was very different from those decided cases referred to by Counsel for the Defendant, where the solicitor had never, at any stage, had authority to conduct proceedings on behalf of the asserted client. 89 In the instant case it is abundantly apparent that each client authorised Mr Barrak to institute the present proceedings, and had no complaint about the fact of such institution or the manner in which those proceedings were conducted by Mr Barrak. 90 As I have already observed, it is usual in cases of this nature that the costs of a successful Plaintiff be paid out of the estate of the testator. In the circumstances of the instant case the Plaintiff, being successful in his claim, is entitled to receive at least the general costs of the proceedings. 91 The disposition by consent of the claim of the Second Plaintiff included an agreement that there should be no order as to costs as between the Second Plaintiff and the Defendant, to the intent that they each pay and bear their own costs. The short minutes of order disposing of the claim of the Second Plaintiff also provided, by paragraph 4 thereof, that the dismissal of the claim of the Second Plaintiff was without prejudice to the rights of the Second Plaintiff and the Defendant to claim the costs of the proceedings against Benjamin Barrak (the Solicitor for the Plaintiffs) and/or Barrak Lawyers (the firm of which Mr Benjamin Barrak is the principal). 92 The Second Plaintiff has not sought to claim the costs of the proceedings against Mr Barrak or his firm. It is only the Defendant who makes such a claim. 93 As has already been observed, I am not satisfied, in any event, that there should be an order for costs in favour of the Defendant against Mr Barrak or his firm in respect to any part of the present proceeding. 94 The Defendant's application for costs against the solicitor will be dismissed. That application extended the hearing of the proceedings by more than half a day, and required the legal representatives of the parties to prepare additional written outlines of submissions. In an estate such as the present, where the assets before the institution of the present proceedings had a likely net value of a little over $219,000, I consider the Defendant's application to have been without justification. The absence of tutors for either or both of the Plaintiffs did not in any way increase the costs of the substantive proceedings. The application unnecessarily occasioned additional costs to the parties, and constituted an irrelevant distraction from the essential subject of the present proceedings, being the claim of the First Plaintiff for additional provision out of his father's estate and/or notional estate. 95 Accordingly, I propose to make an order that the Defendant personally pay the costs of the First Plaintiff and of Mr Barrak and his firm of her notice of motion filed on 29 April 2009, and that she not be entitled to have recourse to the estate and/or notional estate of the Deceased for the payment or recoupment of those costs or of her own costs of the notice of motion. 96 I have already recorded that a bank cheque for the amount of the Plaintiff's legacy of $40,000, together with interest thereon, was sent by the solicitors for the Defendant on 24 October 2008. That was almost two years after the death of the Deceased, and more than four months after the institution of the present proceedings. Subsequently, during the course of correspondence between the solicitors, the Defendant's solicitors on 24 March 2009 demanded the return of that bank cheque. The basis for that demand appears to have been the failure of the Plaintiff to appoint a tutor at the time of the institution of the present proceedings. It is not clear from the evidence whether the bank cheque was in fact returned by the Plaintiff. 97 The reasonableness of the conduct of the Defendant in demanding the return of the legacy of $40,000 may be assessed by postulating a situation where the Plaintiff had not instituted the present proceedings, but was content with the provision made for him by the will. In such circumstances, the question of the appointment of a tutor could not have arisen. Would the Defendant have been entitled to demand that a trustee be appointed before paying the amount of the legacy to the Plaintiff? The Defendant did not have any medical evidence which would have justified such a demand. The Defendant would not have been entitled to withhold payment of the legacy. 98 The Defendant had no justification for demanding the return of the legacy (which, in any event, she should have paid long before October 2008). 99 I make the following orders: 1. I order that, in lieu of the benefit given to him under the will of the late Nelson Yi Hong Chong ("the Deceased"), the Plaintiff receive a legacy in the sum of $100,000. 2. I order that the sum of $60,000, being part of the aforesaid legacy, not bear interest if paid on or before 1 June 2010, and if not so paid, bear interest from that date at the rates prescribed for interest upon unpaid legacies by the Probate and Administration Act 1898. 3. I order that the home unit situate at Albert Road, Strathfield be designated notional estate of the Deceased, to the extent of the value of one half of such home unit. 4. I order that so much of the foregoing legacy of $100,000 as has not already been paid, be paid out of the notional estate of the Deceased. 5. I order that, subject to order 7 hereof, the costs of the Plaintiff on the party and party basis and the costs of the Defendant on the indemnity basis be paid out of the notional estate of the Deceased. 6. I order that the notice of motion filed by the Defendant on 29 April 2009 be dismissed. 7. I order that the Defendant pay the costs of the First Plaintiff and of Benjamin Barrak and of Barrak Lawyers of the aforesaid notice of motion filed by the Defendant on 29 April 2009, and that such costs be paid by the Defendant personally and that she not be entitled to have recourse to the estate and/or the notional estate of the Deceased for the payment or recoupment of such costs or of her own costs of that notice of motion. 8. The exhibits may be returned. **********

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Judgment (27 paragraphs)

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Cases Cited (5)

Cited By (5)