Coomber v Stott

Peacockes Solicitors for plaintiff SOLICITORS : Gells Lawyers for 1st Defendant Bizannes & Associates for 2nd defendant

THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

5562/06 - KATHERINE COOMBER (By her Next Friend VERONICA COOMBER) v SUSAN STOTT & PETER DOUGLAS BARTLETT JUDGMENT 1 HIS HONOUR: This matter first came before me pursuant to a Notice of Motion filed by the plaintiff on 31 October 2006 in which the plaintiff, an applicant under the Family Provision Act 1982 (NSW) in respect of the estate of the late Bruce Geoffrey Thomas sought to enforce an agreement for the compromise of the proposed proceedings. During the course of the hearing it was agreed that the point as to whether there was settlement of the proceedings should be determined as a separate question. I made the following order: "In this matter I order that the question of whether the defendant is bound to form any agreement of the character referred to in paragraphs 1 and 2 of the summons filed on 31 October 2006 be tried separately from all other questions in the proceedings." 2 Paragraphs 1 and 2 in the Summons were in the following terms: "1. A declaration that the agreement to compromise the plaintiff's proposed claim under the Family Provision Act ought to be specifically performed and carried into execution by the defendant. 2. An order that, pursuant to that agreement the defendant pay: a. to the Public Trustee of New South Wales the sum of $603,000,000.00 together with interest at the Court rate as from 2 June 2006, to be held by it for the benefit of Katherine Coomber during her minority; and b. to the plaintiff, her costs as agreed or assessed up to and including 2 June 2006." 3 The plaintiff, Katherine Coomber, was born on 20 February 1994 and she brings these proceedings by her tutor, Veronica Coomber, who is her mother. Veronica Coomber and the deceased began a relationship during 1992 which continued until some months before Katherine's birth. 4 Shortly after the birth of Katherine in May 1994 DNA testing established that the deceased was Katherine's father and thereafter he commenced to make child support payments for his daughter. It is not disputed in the proceedings that Katherine is the daughter of the deceased. 5 Katherine lived with her mother and for many years there was no contact with the deceased following the break up of her mother's relationship. In February 2004 Katherine made contact with the deceased and visited him in July of that year. The deceased died on 16 May 2005. 6 The deceased made a will on 4 September 2000 and subsequently his estate passed to his mother, Margaret Thomas. Margaret Thomas died on 20 June 2005. Under her will, Margaret Thomas appointed the second defendant, Peter Douglas Bartlett, as executor. He was a nephew of Mrs Thomas. The estate was left to Peter Bartlett and five other named beneficiaries in various shares. The plaintiff, Katherine, is the only eligible claimant upon the deceased's estate. The deceased Bruce Geoffrey Thomas had never married and he was the only son of the late Margaret Thomas. 7 The deceased's estate was valued for probate purposes at $1,076,000.63. After the sale of the land held in the estate at Balranald and Mildura and after adjustments were made to account for the fact that two of the deceased's AMP policies did not form part of the estate, the value of the estate as at 13 March 2007 was $1,246,158 and was cash invested in an interest bearing deposit. 8 The plaintiff's case is that in the course of correspondence prior to the commencement of proceedings it was agreed, in particular in a letter of 2 June 2006 written by the estate's then solicitors, Perrot's, with the plaintiff's solicitors, Peacockes, that the plaintiff's proposed claim would be compromised in the sum of 50 percent of the estate plus costs. 9 The first defendant in the proceedings, Susan Stott, is the executor of the deceased's will and she has submitted to any order that the Court might make. The effective contradictor in the proceedings is the executor of the deceased's mother's estate who is the second defendant. The second defendant's defence to claim was three-fold as follows: "(a) No concluded agreement was made between the plaintiff and the first defendant.

(b) If (contrary to the Second Defendant's submissions) a concluded agreement was made, it was subject to approval of the Court of a grant of relief under the Act and (having regard to the character and quantum of the relief claimed by the Plaintiff, and the nature of the interests represented by the Second Defendant) no approval should be given.

(c) If a concluded agreement was made and would otherwise be enforced (contrary to the Second Defendant's submissions) then, on the principles enunciated in Lewis v Combell Constructions Pty Ltd (1989) 18 NSWLR 528 at 538E-F and Mohamed v Farah [2004] NSWSC 482 at [64] and [66]-[67], the Court should decline to enforce the agreement on the basis that it would be unjust to do so and the interests of justice require that the Plaintiff's FPA claim proceed to trial." Was there a concluded agreement between the plaintiff and the first defendant? 10 In the second half of 2005 there is correspondence between the solicitors for the estate and the proposed claimant regarding the claim. In August 2005 the estate's solicitors sought extensive details of what was the claim that was to be made on behalf of Katherine Coomber. This included her mother's financial situation, Katherine's schooling and the likely future course of Katherine's education. It was not until 10 April 2006 that Katherine's solicitors provided a three-page letter giving the information requested by the estate's solicitors. They mentioned that they were obtaining the advice of an actuary. On 25 May 2006 Peacockes, solicitors for Katherine, wrote as follows: "We refer to previous correspondence. We advise that we have received a preliminary report from the actuary. We have received instructions from our client to make an offer of settlement in the sum $425,000 plus costs as agreed or assessed. This offer is made on the assumption that the estate has a net value of approximately $850,000. Our client has received advice from counsel that the Court would be unlikely to approve anything less in the event of litigation. We look forward to receiving your reply." 11 The following day, 26 May 2005, after a telephone conversation between persons in the relevant offices, Peacockes again sent a letter to the estate's solicitors, Perrot's, in these terms: "We refer to previous correspondence.

We confirm we have received a preliminary report from an actuary.

We confirm your advice that the estate has a net value of $1,206,000.00. We have received instructions from our client to make an offer of settlement in the sum of $603,000 plus costs as agreed or assessed. …." 12 That letter was apparently sent by facsimile and on the next day, 26 May 2006 Perrot's replied as follows: "We acknowledge receipt of your facsimile of the 25 May 2006. In accordance with instructions received from the Executrix of the Estate, we advise that the estate as a net value of $1,206,504.87. We note that your offer is 50% of the estate and we would ask that you let us have a letter duly amending the amount of the estate offer to 50% of the $1,206,504.87 to enable us to pass the offer onto the Executrix and also the beneficiaries under Margaret Thomas's estate. We would also ask that you provide us with your costs in relation to the matter." 13 That letter was sent by facsimile to Mr Bartlett with advice to accept it from Mr Gary Perrot. Mr Bartlett rang and initially spoke to Debbie Wood at Perrot's and the following day to Mr Perrot. That conversation was in these terms: Bartleet: "For me to agree to 50% I would have to satisfy the beneficiaries that it is the correct thing to do. I will need it in writing so that I've got something to show them."

Perrot: "It's the only way to go. I won't hesitate to give it to you." Bartleet: "What about Bruce's will?"

Perrot: "Wills can be changed. It doesn't matter what's in it. She's got the child and is entitled to 50%. She could get more." 14 Following that conversation Mr Bartlett sent by facsimile on 2 June the following letter to Perrot's. "RE. Katherine Coomber BNF Veronica Coomber and the estate of the late Bruce Geoffrey Thomas - Family Division Act claim. I wish to confirm my acceptance of the offer of settlement made by Peacockes Solicitors on behalf of Katherine Coomber BNF Veronica Coomber. This approval is subject to the following conditions: There is no claim made on the estate of Margaret Thomas (Deceased) and that it is indemnified. All beneficiaries would like an independent body to control the trust account of Katherine Coomber and would prefer it to be the Public Trustees.

Yours faithfully, PD. Bartlett (executor for the estate of Margaret Thomas (Deceased)."

15 It is plain that the second condition was agreed to between the solicitors. With regard to the first condition I would infer that some such request must have been raised with Mr Perrot in Mr Bartlett's conversation with him for it to be raised in the conversation which was held on 1 June 2006 to which I will refer shortly. 16 On 30 May 2006 Peacockes replied to Perrots and noted that there would need to be terms of settlement and they anticipated that the terms would be prepared by Perrot's. Peacockes commented that they would soon be in a position to advise of their costs and disbursements. 17 On 1 June 2006 Peacockes wrote to Perrot's giving details of the costs of the proposed plaintiff. 18 On 1 June 2006 there was a telephone conversation between Belinda Maiden, a partner of Peacockes and Debbie Wood at Perrot's. In the conversation there was discussion about to whom the money should be paid on behalf of the plaintiff and the two parties to the conversation seemed to agree that it would be the Public Trustee. There was also discussion about the need for some indemnity concerning any claim by the plaintiff against the deceased's mother's estate. Both solicitors seemed to agree that that step was not necessary. 19 On 2 June 2006 the letter which is the key to the plaintiff's claim was sent by Perrot's to Peacockes. No doubt it was sent after receipt of the facsimile from Mr Bartlett on 2 June 2006. It was in these terms: We acknowledge receipt of your letter of the 30 May 2006. We confirm our telephone advice that our client has accepted the offer of 50% of the estate plus costs. We have instructed Counsel to prepare the Terms of Settlement and once they arrive, we will forward same onto you. We also confirm our advice that if possible, our client would like to settle this matter prior to the end of June. We look forward to receiving your costs as soon as possible so that we can forward same onto Counsel." 20 Thereafter there were discussions about the preparation of documents for the approval. In a letter of 21 June 2006 the estate's solicitors, Perrot's, wrote and said, inter alia: "We also confirm that the Executrix will be making a claim on the estate for 5% commission and perhaps you might seek instructions from your client as to her approval and advise." 21 On 11 August 2006, Mr Peter Douglas Bartlett, the executor of the deceased's mother's estate instructed Perrot's who acted for both estates to withdraw the agreement that had been made and thereafter their retainer was terminated and new solicitors, Bizannes & Associates, acted for the estate of the deceased. 22 The first point made about the offers to which I have referred was that the offers of 25 and 26 May 2006 were in terms of absolute sums of money based on some assumed value of the estate. The letter of 26 May 2006 seems to pick up the point that the offer was made in an amount of half the value of the estate and merely sought to increase what the offer would be. Not surprisingly, this was not commented on by Peacockes and any requirement for a further letter does not seem to have been raised again or of concern to either solicitor. The letter of 2 June 2006 indicates an acceptance of what was the de facto position in the earlier correspondence, namely, one half of the estate as being the substance of the offer. 23 The fact that the estate may not have been completely quantified does not prevent a concluded agreement being arrived at because the estate can ultimately be quantified and the share determined. This happens every day when people leave shares in their estate. There was no need for costs to be quantified as the offer was made on a basis that included payment of the plaintiff's costs. In the context of Family Provision Act matters this has a standard connotation that such costs of a plaintiff are costs on the ordinary basis. 24 The net estate is the value of the estate after all proper administration expenses have been paid, as the executor has a liability to pay the estate's expenses. The plaintiff's costs are in addition to the amount to be paid to her under the offer and they do not impact on the amount of the net estate. In these circumstances it seems to me that the fact that the letter of 21 June 2006 made reference to commission and instructions for approval does not detract from the fact that the amount of the estate would be plainly less any deductions which would have to be made in the proper course of administration of the estate. 25 It seems that the solicitor for the estate did not insist on including a term that the plaintiff indemnify the mother's estate from any claim. There is nothing in the evidence to suggest that the plaintiff had notice of the restrictions placed on the solicitor's authority to settle as contained in Mr Bartlett's facsimile of 2 June 2006. 26 Plainly Mr Perrot had the usual authority to settle the proceedings. The settlement contained no collateral terms and in these circumstances authority indicates that the compromise will bind the client. See the cases in footnote 112 in Lawyers Professional Responsibility in Australia and New Zealand by GE Dal Pont 2nd edition. 27 Although the parties contemplated preparing short minutes they were not in fact agreed to and signed. The Court requires short minutes to facilitate the Court's task of recording its orders. In my view this case is one where the parties reached finality by arranging the terms of their bargain and intended to be immediately bound and at the same time they proposed to have the terms incorporated in short minutes. See Masters v Cameron (1954) 91 CLR 353 at 360. In my view there was a concluded agreement. Approval of the Court to the grant of relief under the Act 28 It is clear that the agreement requires the approval of the Court under s 76 of the Civil Procedure Act. It also may, depending upon what view one takes of the authorities, require the Court to be satisfied that the Court has jurisdiction. However, these matters do not mean that there is not a binding agreement. In the agreement there will normally be an implied term which requires the parties to jointly apply to the Court for approval and to cooperate with each other in that regard. See Smallman v Smallman [1972] Fam 25 at 31. Should the Court decline to enforce the agreement? 29 Reference was made to Lewis v Combell Constructions Pty Ltd (1989) 18 NSWLR 528 a case where a Court refused to enforce an agreement for compromise where the acceptance was made by mistake where a reasonable solicitor for the defendant would have considered that the offer was likely to have been a mistake. His Honour, Finlay J, at 538 said the following: "What I perceive to be the relevant principle in the category of cases into which this matter falls is that in an appropriate case, especially before judgment is made, the overriding interests of justice and the court's concern over its own procedure may mean that the court will not enforce a contract. Of course, contracts made during the court's process to settle, if they are bona fide and not affected by any error, will normally be enforced. But I repeat my previous observation that whenever parties agree to a compromise of litigation they do so subject to the procedures of the court which include the possibility that the court may consider it unjust to enforce the terms of settlement or that it is in the interests of justice that the matter proceed to trial. In my view the overriding principle with which the court is here concerned is the interests of justice in all the circumstances. " 30 In Mohamed v Farah [2004] NSWSC 482, Barrett J had to deal with a situation where there was also a mistake which did not lead to setting it aside. His Honour accepted the principle set out by Finlay J in Lewis v Combell Constructions Ltd [1989] 18 NSWLR 528. It is necessary to turn to the circumstances to see whether there might be an appropriate basis for not enforcing settlement. 31 The first matter which it is suggested requires the setting aside of the compromise is that the settlement was made contrary to the express instructions to include a term as to indemnity. In Marsden v Marsden [1972] Fam 280 [1972] 2 All ER 1162, the client's instructions placed a limit on the ordinary authority of counsel and solicitor. In that case Watkins J accepted as the law a quotation from 3 Halsbury's Laws (3rd Edn) 51, para 74 in these terms: "The position is more uncertain where the authority of counsel is limited, but the limitation is unknown to the other side, who enters into the compromise believing that the opponent's counsel has the ordinary unlimited authority. Counsel has an apparent or ostensible authority, at least as wide as his implied authority, to compromise a claim; and in some cases, where the matter is within the apparent authority of counsel, the courts have refused to inquire whether there was any limitation, when it was not communicated to the other side, and have refused to set aside a compromise entered into by counsel. The true rule seems to be, however, that in such a case the court has power to interfere; that it is not prevented by the agreement of counsel from setting aside the compromise; that it is a matter for the discretion of the court; and that when, in the particular circumstances of the case, grave injustice would be done by allowing the compromise to stand, it may be set aside, even though the limitation of counsel's authority was unknown to the other side." 32 In the case before His Honour it was plain that a breach of the express restriction would cause a grave injustice. The question is whether it would cause a grave injustice in this case. 33 It seems clear that the only claim the plaintiff might have upon the mother's estate was that she was at some stage dependent or partly dependent on the mother. The affidavit from the plaintiff's mother on 23 February 2007 gives details of the very limited relationship between the plaintiff and her father. In that affidavit she says that she and the deceased separated when she was six weeks' pregnant. There was no contact for some two years and then the contact seems to have been limited to proving the deceased's paternity. This led to the payment of child support. 34 The plaintiff's mother also speaks of not having allowed her daughter to see her father until February 2004 when she allowed the first contact with her father. This led to a visit in July 2004 when the plaintiff met the deceased and his mother. There was one more visit and then no further contact apart from cards and some fortnightly telephone calls. By March 2005, Katherine was unable to contact her father as he had moved between Balranald and Mildura. It was obviously plain from the affidavit that the plaintiff lived with her mother throughout her childhood and in these circumstances the chance of her being dependent on her grandmother would seem to be unlikely. In those circumstances it seems to me and no doubt it seemed to the solicitors at the time, that it was unlikely that the plaintiff would have any claim on the grandmother's estate. 35 In these circumstances, I do not think that this breach of instructions was sufficiently serious to warrant the exercise of my discretion to set aside the compromise agreement. 36 The other ground upon which it is suggested that the compromise agreement should be set aside is that the Court having regard to the character and quantum of the relief claimed by the plaintiff and the nature of the interest represented by the second defendant would conclude that the amount was far greater than was necessary for the plaintiff's proper maintenance, education and advancement in life. 37 I turn to consider the evidence which relates to the application by Katherine Coomber, the plaintiff. The plaintiff is 13 years of age and attends Balranald Central School where she has settled in well. Her mother describes her as a highly intelligent and dedicated student who has been assessed previously as gifted and talented in certain areas. I accept the mother's evidence that she will complete her secondary education to Year 12. It is probably likely that she will continue her education at tertiary level.

The plaintiff's mother, Veronica Coomber 38 Veronica Coomber and Katherine moved to Balranald in April 2006 where Veronica purchased a property for $114,000. She used existing funds to purchase the property including $80,000 given by her mother which she feels obliged to repay if her mother ever needed it. Her other assets consist of superannuation worth $49,063 which she cannot access at this stage. She has a vehicle worth $5,000. Her health is not good as she suffers from ischaemic heart disease. She suffered a cardiac arrest when she was 36 years old. She is on medication for blood pressure and suffers from depression which is managed by taking Arapax. She also has problems with diabetes and has an under active thyroid. Veronica has not returned to full-time work due to her depression. She has a small workers compensation claim which will support her over the next few months. She has had casual work of about 2 hours a week and she might be able to obtain some further part time work. At the present time Veronica receives payments from Centrelink of $624.54 a fortnight. Expenses for Veronica and Katherine are estimated at $702 a fortnight. 39 When considering the claim of the plaintiff it is also necessary to consider others having a claim on the bounty of the deceased. The position of the beneficiaries in the estate of the late Bruce Geoffrey Thomas must be considered by the Court. There are, amongst the six beneficiaries, four nephews of the late Margaret Thomas and two close family friends who were friends of the mother Margaret Thomas for over 30 years. There is no evidence of any relationship between them and the deceased although I would infer that there was some contact between them having regard to the family background. The financial situation of the beneficiaries was put forward by the executor, Mr Peter Douglas Bartlett in his affidavit in these terms: "Peter Douglas Bartlett I am aged 67 and have never married. I am unemployed and receive the age pension of 517.90 a fortnight which is my sole source of income. I suffer from an arthritic condition. I own my own house at 14 Riley Street Woolloomooloo which I acquired after a lifetime employment in various industries and administrative positions. Graham Bartlett Aged 57 years married with one child an 11 year old daughter. He is unemployed. His wife suffers from chronic heart condition and schizophrenia They receive a chronic disability pension of $1,150.16 a fortnight and he acts as her carer. He recently acquired the house at Balranald formerly owned by the deceased Margaret Thomas which he purchased from the legacy in her will. Colin David Bartlett Aged 63 years. Married with grown children. He and his wife receive a combined disability pension of $861.20 a fortnight. They reside in a mobile home and pay site fees of $150 a fortnight. John Ivor Bartlett Aged 61 years. Unmarried. Casual employment only in the hospitality industry. No regular employment and dependent on casual work. Owns his own house in Brisbane Keith and Cynthia Gorrinqe Both aged about 59 years. Both on disability pensions through work related injuries to their backs. Reside in Adelaide and own their own home. They have a mortgage of $80,000. Their combined pension is $760 a fortnight. 40 I reserved the question of the admissibility of the evidence given in respect of persons other than the executor, Mr Peter Douglas Bartlett. Given the relationship between Mr Peter Douglas Bartlett and the other persons I admit the evidence to avoid undue expense and delay in respect of what are unlikely to be controversial facts. 41 It is of course necessary to see how the plaintiff is said to have been left without adequate and proper provision for her maintenance, education and advancement in life. 42 In her affidavit evidence Katherine's mother, Veronica Coomber, identified a number of matters which she says are necessary for Katherine's support and education. These are: Music lessons at $40 a week for 4 years $ 8,320 Orthodontic treatment $ 8,000 Private schooling 3 years senior school $48,000 Total $64,300 43 In addition there is a small amount in respect of the income of Katherine's mother to make up the shortfall for the next four years until she turns 18 years of age of $ 77 per week. The multiplier on the 5% tables is 231.5 for 5 years making a sum of $17,825.50. 44 The only further matter which may possibly need to be addressed is support for Katherine if she does decide to undertake tertiary studies. Although her mother expressed a view that she would like to be able to undertake tertiary studies there is nothing in the evidence as to Katherine's wishes although it probably would be likely if her present progress continues at school. The evidence before me did not address these costs in detail and it is to be remembered that there are provisions for the Commonwealth to pay university fees and for students to repay the fees at a later stage. 45 Bearing in mind that Katherine may have to leave Balranald to do any tertiary education and using as a rough guide the costs of secondary education, one could allow a further $100,000 for this cost. Allowing for something for contingencies the most favourable outcome on the present evidence for the plaintiff is an award in the area of $200,000 to $250,000. 46 I have earlier referred to the extent of the contact between the plaintiff and the deceased. This raises the question of what effect this might have on the plaintiff's claim. 47 Section 7 of the Family Provision Act provides that if a court is satisfied that a person is an eligible person "it may order that such provision be made out of the estate or notional estate, or both, of the deceased person as, in the opinion of the court, ought, having regard to the circumstances at the time the order is made to be made for the maintenance, education or advancement in life of the eligible person." 48 In Benney v Jones (1991) 23 NSWLR 559 at 568-9, Priestley JA noted as follows: "This conclusion directly raises the question of whether the word "ought" in s.7 of the Act carries with it an idea of moral obligation. In answering this question some guidance may be obtained from authoritative decisions under the Testator's Family Maintenance & Guardianship of Infants Act 1916 (as amended), using due care to take account of the differences between the two Acts. ….. It seems plain from the comparison of the two Acts, and particularly from s.3 of the 1916 Act and s.7 and s.9 of the present Act, that language from the earlier Act has been deliberately carried into the later one. It would seem that at least one purpose of this retention of much litigated sets of words is that the benefit of the authorities on those words may be available in the construction of the present Act. The same reasoning supports the view that where the new Act uses a different word in an important operative section from the word in the corresponding section of the earlier Act, the difference is deliberate and has a purpose. The Act draws a distinction between the eligible persons referred to in par(a) and par(b) on the one hand and par(c) and par(d) on the other. Broadly speaking, the distinction can be seen as one between classes of people who, in the ordinary course of family life would, prima facie, be persons to whom the deceased's person spoken of in s.3 of the 1916 Act and s.7 of the present Act would have an obligation to make provision, whereas those in the other class would, prima facie, not be regarded in the ordinary course of family life as being likely to be made the subject of provision by the deceased. In regard to the first class, the more usual approach under the 1916 Act was that before making an order, the court needed to be satisfied that the testator ought to have made provision for the applicant, in all the circumstances of the case: see Bosch v Perpetual Trustee Co Ltd [1938] AC 463 at 478-479 and Hughes v National Trustees Executors and Agency Co of Australasia Ltd (1979) 143 CLR 134 at 146-147 per Gibbs J, with whom Mason and Aickin J both agreed. However, there was a differing view, expressed by Murphy J, in the same case when, after commenting (at 158) that "many cases suggest that an applicant must show a moral claim …", he went on to say that this was a gloss on the Act and was unwarranted and inconsistent with the language of the legislative scheme. It seems to me that the introduction into s.7 of the present Act of the word "ought" in replacement of the words from s.3 of the 1916 Act "as the Court thinks fit" shows the intention of the present Act to accept the approach adopted by the majority in Hughes and to reject that of Murphy J. The word "ought" seems to be deliberately adopted, in the present Act, from what Gibbs J called the classical statement in Bosch . To my mind, this is a very clear indication that an eligible person within par(c) and par(d) must show a moral claim on the estate before an order can be made; I also think this is the same thing as saying that the deceased person must have had a moral obligation to that eligible person. It is hard to imagine how the one could exist without the other. It seems to me that the same reasoning is very probably applicable to applications by eligible persons within par(a) and par(b) although it is unnecessary to decide that in this case." 49 Meagher JA (NSWLR at 570) agreed with Priestley JA. 50 Meagher JA had previously expressed a view in Hughes v Hughes, Court of Appeal, unreported 6 June 1989 (an adult daughter case) that the duty arose to make provision as established in that case as follows:- "Her right arises not merely from the bare fact of parenthood, which of itself does not generate a right , but from the general circumstances of the case; namely, parenthood, the performance of normal filial duties in the 10 years after she left school and in the two periods between her earlier trips and in her professed and continued willingness to be of whatever assistance to her father she could be." (Emphases added). 51 Hope and Samuels JJA concurred in the judgment of Meagher JA in Hughes v Hughes. 52 In Benney v Jones, Mahoney JA at 560 said: "Whether an order should be made raises (as it has been described) the moral or normative question. That question remains, whether the application is made under the former or the present Act. The nature of that question was discussed in this Court and in the High Court in White v Barron (1980) 144 CLR 431; and in Goodman v Windeyer (1980) 144 CLR 490: see, also, Kearns v Ellis (Court of Appeal 5 December 1984 unreported) and Gorton v Parks (1989) 17 NSWLR 1. "Where the applicant is a member of the deceased's family, as referred to in the earlier paragraphs of s.6(1) relating to eligible persons, the nature of the duty which the deceased should have fulfilled is reasonably clear." 53 In Gorton v Parks (1989) 17 NSWLR 1 at 7 ff, Bryson J analysed the relevant authorities dealing with claims by able-bodied adult males. For present purposes, there is no reason to distinguish able-bodied adult females. In the course of doing so, His Honour noted: "It is then established by authority that no special principle is to be applied, and it seems important to warn myself against allowing prima facie views or the success of some applicants who have special claims to disturb the perception that there is no special principle. In particular, an idea that an able-bodied adult male who is earning a living could have no claim in relation to resources of any size is quite erroneous and must not be entertained either prima facie or at any stage. It is a discarded categorisation:" 54 Bryson J also rationalised the decision of Pontifical Society for the Propagation of the Faith v Scales (Scales Case) (1962) 107 CLR 9. Scales' case was a claim by an adult son, who was unsuccessful, and where Dixon CJ said (at 18): "The outstanding fact of the case is that, throughout the period of their joint lives, the son disregarded the father and the father disregarded the son and after a time expressly disowned him. … In truth there is the bare fact of paternity and no other mutual relation: the case depends upon that fact and basically upon nothing else except all the arguments of right and wrong that may be considered to spring from that source and affect the situation of the parties as it existed at the testator's death." 55 At 17 NSWLR 1 at 9-10, Bryson J sought to distinguish Scales Case. He said: "Dixon CJ did not expound the weight which he gave to the bare fact of paternity and nothing else; I regard that bare fact as of very great importance in morality. The idea that the moral obligations arising from paternity are diminished or do not exist if the parent withholds acknowledgment of the obligations or of the child appears to me to be an idea from a distant age. There have been changes over long periods in the beliefs of the community about moral duty to children, and there seems in the distant past to have been some acceptance of a view that unless children were legitimate or were acknowledged by their father, he has no moral duty towards them. There seem to have been legal systems in the past in which attempts to provide for illegitimate children by will were ineffective; … Under modern legislation parental duties are not distinguished according to acknowledgment or legitimacy. The idea that acknowledgment by a parent of a child or full accordance of status by a parent might increase the responsibilities of a parent or be significant to moral duty towards the child, with the contrary implications, seems a very strange idea and it is curious to find it, even in a limited way, in a judgment published as recently as 1962." 56 Bryson J in any event distinguished Scales case (p 11) on the basis that on the facts before him the plaintiffs, "In their childhood years they lived in the same street in which their father lived in far greater prosperity a few doors away: they saw him and he saw them from time to time, and they had a relationship with him in which negative aspects preponderated greatly or almost exclusively over any positive aspects of the familial relations. A mutual relation there was. Each of them had a relationship with the testator which the testator brought to an end; in the case of Mrs Joan Adams and Mr John Culcott, he saw something of them and made an inadequate contribution to their maintenance in their childhood, but in effect abandoned the relationship before they reached mature years and at a time when they cannot fairly be held responsible for ending the relationship. They were present before his eyes in their childhood and years of education and trade training; he knew who they were, he must have had an idea of what they were doing, and he did not make even token attempts to assist them in any way. .." 57 In Walker v Walker (unreported 17 May 1996), Young J reviewed the question of moral duty. His Honour reviewed Gorton's case, in the context of the earlier High Court and House of Lords decisions, noting the effect of Singer v Berghouse (1994) 184 CLR 201 as follows: "In Singer's case , a widow who had been married less than one year to a 68 year old man failed in her application under this Act in this court, in the Court of Appeal and in the High Court. The majority of the court said at page 208 and following that to assess a claim under the present Act there is a two stage process. The first stage is to determine whether an applicant has been left without adequate provision and the second stage is to determine what provision ought to have been made. At p 209 the Judges point out that Re Allen has guided past courts and has three times been approved by the Privy Council or High Court, but that "we doubt this statement provides useful assistance in elucidating the statutory provisions. Indeed, references to "moral duty" or "moral obligation" may well be understood as amounting to a gloss on the statutory language". They then say "the determination of the first stage in the two stage process calls for an assessment of whether the provision (if any) made was inadequate for what, in all the circumstances, was the proper level of maintenance etc. appropriate for the applicant having regard, amongst other things, to the applicant's financial position, the size and nature of the deceased's estate, the totality of the relationship between the applicant and the deceased, and the relationship between the deceased and other persons who have legitimate claims upon his or her bounty." 58 Young J also observed: "In Fraser's case, Kirby P at p29 said that "I do not consider that it would be safe for this court, or other courts in this state, to disregard the obita dicta in Singer v Berghouse concerning "moral duty". However, His Honour's decision made it quite clear that he thought that references to moral duty in the judgment under appeal really amounted to little more than a shorthand expression for the lengthier statutory provisions actually used in the Act. His Honour made it clear that there was no drastic change in the law "either by the observations of the majority in Singer or by the High Court's reference, in the footnote, to what Murphy J said earlier (p27)." "Handley JA thought that the dicta in the High Court in Singer should not be followed and pointed out that even as late as 1994 in Neil v Nott (1994) 68 ALJR 509, the High Court was itself using the words "moral claim" in decisions under this Act. "Sheller JA again did not consider that the High Court's suggested abandonment of concepts of moral claim or moral obligation changed the task of the court. He said, with reference to decisions of Murphy J at p42 "the point made in the judgments to which Murphy J referred was that the existence of a moral obligation owed by the deceased to the claimant was a necessary part of the claimant's case but not alone sufficient to justify an order in the claimant's favour. Thus, in theory an order would not be made out of the estate of a deceased parent in favour of a child who had over many years completely cut himself or herself off from the parent, even though the child was left in need. On the other hand, a wealthy child who had cared for the parent throughout his or her life may have no claim for further provision under the legislation. The courts, in giving effect to the legislative scheme, having accepted that the bare moral claims of the sort mentioned by Stout CJ in re Allardice (1910) 29 NSWLR 959, 970 will not alone suffice to empower the court to make an order." 59 The concerns expressed about any change in the law as a result of Singer v Berghouse were recently put to rest by the High Court in Vigolo v Bostin [2005] HCA 11 at 25, 74-75 and 121. 60 In Walker v Walker, (p 27) Young J noted: "It is often impossible to work out whether the degree of separation between parent and child at the date of the parent's death is solely the fault of either or whether it has come about by factors too strong for either to control or somewhere in between. The important matter is not fault, but, whether in all the circumstances it would be expected by the community that the testator would have to make a greater benefaction than he in fact did to constitute proper or adequate provision for the plaintiff.

Accordingly, I reject the approach that all an applicant under this Act has to do is to prove that he or she is an eligible person and that he or she reasonably needs more financial assistance. The cases show that there must be a full investigation into all the facts and circumstances of the matter to see whether the community would expect that a person in the plight of this testator ought to have made provision or further provision for the applicant…"

61 These words were recently approved by Ipp J in Palmer v Dolman; Dolman v Palmer [2005] NSWCA 361 when he said: "I agree with his Honour's remarks, although I would express the rider that, often, where an applicant is a person within paragraphs (a) or (b) of the definition of "eligible person" in s 6(1) of the Act, proof that the applicant is a person in need will be sufficient. I accept however that there must be a full investigation into all the facts and circumstances as his Honour expounds." 62 In the circumstances of this case it is plain that separation was not the choice of the plaintiff but more that of her mother and the deceased. The plaintiff did what she could to make contact with the deceased, her father, and obviously enjoyed the contact. In these circumstances the Court might take a view that the plaintiff's claim should not be reduced because of lack of a contact. 63 It is to be noted that the plaintiff is the only eligible person in the estate. Although some of the beneficiaries were relatives and others were his mother's friends, on the evidence there was not a close relationship between them and the deceased. They do suffer some hardship although other than the payment of something to provide for their later years they do not seem to have any particular problems. If the settlement were approved each beneficiary could expect to receive a little less than $100,000. 64 Having regard to the facts before me it would seem to me that the plaintiff has compromised her claim for an amount which is slightly more than double what her claim is worth. This, of course, impacts on the beneficiaries but given the limited information on the beneficiaries, it is difficult to see that it would cause any particular hardship bearing in mind their relationship with the deceased. 65 Section 76 of the Civil Procedure Act provides that in respect of proceedings commenced by a person under a legal incapacity, the Court may approve or disapprove any agreement for compromise or settlement of that claim. Although the wording in the section gives an unfettered discretion it would seem that having regard to authority the Court would only approve the compromise if it were in the infant's best interests. See Permanent Trustee v Mills [2007] NSWSC 336 at [19 - [29]. In the present case, of course, the compromise is very much in favour of the infant and I would not have refused to approve the settlement under section 76. 66 There is no doubt that the Court in the circumstances of the present case would have jurisdiction to make appropriate orders. The plaintiff was left without any provision and she has an obvious need for help with her education. In an ordinary case the Court would accept a settlement where the parties are sui juris but where, as here, a party is under a disability the matter must come before the Court for its approval. Similarly where the Court is bound to make a judgment about matters such as a release of rights under section 31(5) of the Family Provision Act. See generally on this aspect Mitchell v Osborne Young J 20 May 1997 and the cases His Honour refers to in that decision. 67 In terms of the authorities, to which I have earlier referred, on the residual discretion of the Court to not approve a settlement when it is asked to make orders, the question is whether there is any injustice in making orders in accordance with the agreed compromise. In the present case there is no injustice so far as the plaintiff is concerned. She has been able to achieve a generous settlement given the evidence available. 68 In respect of the defendants it may be said to be an injustice because they will receive less than they would have ordinarily received if the matter had been fully litigated. Although the individual circumstances of the beneficiaries are before the Court they will each receive a substantial amount from the estate and in the context of what little information the Court has about what may be described as their needs or desires, there is nothing to suggest they will suffer some injustice by receiving the sum of $100,000 rather than the sum which they would receive if the matter was fully litigated. If the matter was fully litigated after allowing for the costs of the litigation each beneficiary might expect to receive perhaps another $38,000. It is to be borne in mind that none of the beneficiaries on the evidence before me are eligible persons who could make a claim on the estate of the deceased. It was their good fortune that the deaths occurred in the sequence that they did and that they received substantial bequests. 69 The decision which the executor made to instruct his solicitors to accept the settlement was based upon advice given to the executor by the solicitor. The advice was plainly that he should accept. It may be that if that advice was wrong then some other remedy would be available. 70 Although I have concluded on the evidence before me that the settlement was generous to the plaintiff, it would require a more detailed investigation if I had to consider whether or not the solicitor or barrister advising the estate was negligent in giving the advice. However, they are not parties or witnesses in the present proceedings. In the absence of evidence which would allow me to decide whether the advice was negligent, I conclude that there is no injustice which would require me to refuse to make an order in accordance with the settlement. In my view the Court should determine the separate question and make orders in accordance with paragraphs 1 and 2 of the Summons or some other appropriate orders. 71 I direct the parties to bring in short minutes. **********

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