D'Albora v D'Albora

35 IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

3131/98 JASMINE ROSARIA D'ALBORA v ANTHONY D'ALBORA

1 MASTER MACREADY: This is an application under the Family Provision Act in respect of the estate of the late Ethel Doreen Quinn who died on 22 February 1997. She was survived by her daughter Sharon Quinn, two grandchildren, the plaintiff, Jasmine D'Albora and the defendant, Anthony D'Albora. The grandchildren are the children of the daughter, Sharon Quinn. Sharon has been given notice of the proceedings and she makes no claim. 2 By her will made 8 February 1996 the deceased left the whole of her estate to the defendant and appointed him Executor. 3 The assets of the deceased at the date of death consisted of her property 57 Boondilla Road, The Entrance and cash of $10,131.60. The house has been sold and the estate reduced to cash. Administration, funeral and other testamentary expenses have been paid and the balance, namely, $158,051.46 has been distributed to the defendant. He has subsequently purchased a house using that money and some borrowed funds. 4 There are costs which have been incurred by the parties in the proceedings. The defendant's costs on the basis of the hearing would be for two days was $12,092. In the event the matter has only proceeded for one hearing day. The plaintiff's costs on a two day basis were estimated at $15,400. 5 As there are difficulties in this case in determining whether the plaintiff was at any particular time wholly or partly dependent upon her grandmother, the deceased it is necessary to ensure that the chronology of the family history is understood. I turn to that question. The plaintiff who was born on 10 February 1971 is now 28. The defendant was born on 20 June 1973 and is now 25. In the mid to late 1970s the plaintiff's parents lived at Kingsford and then Mallabar. At that time the plaintiff's maternal grandparents were living at Maroubra. 6 In 1977 the grandparents moved to the Entrance. They first lived in a caravan and then the property which they purchased at 57 Boondilla Road, The Entrance. 7 In 1981 the parties' parents separated. They divorced some time in 1982 or 1983 and the two children, the parties to the proceedings, spent one year in St Anthony's Children's Home at Croydon. At the end of that period of one year the parties' father was granted custody of the children. They moved back to live with him and his new wife Lisa D'Albora. She had already 4 children of her own before meeting the parties' father. They subsequently had another child. 8 In 1987 the plaintiff left high school having completed Year 11 and she went to TAFE for a year to do a course. 9 In 1988 the defendant moved to the Entrance to live with his maternal grandparents on a full time basis while he completed high school. He completed high school in 1992 and then moved to Sydney. 10 In 1993 the father of the parties moved out of the Housing Commission home at Merrylands which he had been occupying and between them the lease was transferred to the plaintiff who remained in occupation in that Housing Commission home. 11 On 10 April 1996 the parties' maternal grandfather died. He had been suffering from Alzheimers disease. In July 1996 the plaintiff was evicted from the Housing Commission house as she could not meet the rent. Her life then had a period of disarray. 12 On 22 February 1997 the deceased died and probate of the will was granted on 19 June 1997. 13 On 30 June 1997 a notice of intended distribution was published. On 28 July 1997 contracts for the sale of the house were exchanged. 14 On 28 November 1997 the defendant purchased a property at 18 Ferndale Close, Wentworthville, for $233,000. He borrowed $110,000 to do so and presently would owe approximately $107,000 on that mortgage. 15 On 14 July 1998 the summons in this matter was issued. There seems to have been no correspondence prior to this date warning of the commencement of these proceedings. 16 As I have already indicated the plaintiff in order to establish that she is an eligible person must show that she was at any particular time wholly or partly dependent upon the deceased. The plaintiff's case on this aspect is based upon allegations that she resided during holiday periods with her maternal grandparents and was dependent upon them for accommodation, food, clothing and other necessities of life. The particular periods over which the plaintiff alleges that this occurred are not easy to ascertain but there appear to be four different periods. 17 The first is a period of 12 months shortly after deceased and her husband commenced to reside in a caravan at the Entrance in 1977. At this stage the plaintiff would have been approximately six and the defendant approximately four. Not surprisingly neither the plaintiff nor the defendant gave evidence of these occasions. However evidence was given by the parties' mother. Her evidence was that during this period 12 months following the grandparents moving to the Entrance the two children resided during each of the school holidays in May and August and Christmas. The reason given was that the parties' mother was working at Parramatta and was unable to care for the children. Apparently the father also had difficulties in this regard. The father of the parties, Antonio D'Albora gave evidence in this case. While he responded to some of the plaintiff's and other witnesses' affidavits he gave no evidence to dispute this particular period when the children resided with the grandparents. The arrangements for support of the children when they were with the grandparents in these holiday periods was dealt with by the parties' mother who gave evidence that she did not provide any financial assistance at that time. She also gave evidence that the deceased bought additional clothing for the children at a local second hand clothing store at the Entrance during the times that the children were in their care. As I have mentioned no evidence was given by the father of the children as to this period and, accordingly, there is no reason why I should not accept the evidence of the parties' mother on the fact that the plaintiff did reside with her grandparents for each of the three holiday periods during that year and that no monies were provided by the mother or father to assist with their support during this period. There is no evidence as to the ownership of the house of the grandparents at The Entrance but this is not critical. To the extent that there was accommodation provided even if the home was in the name of the grandfather rather than the deceased grandmother one would think at a practical level that the provision of accommodation required the consent of both the relevant parties and thus in that sense the deceased may have, even though not the owner of the house, been party to the provision of the accommodation. 18 The next period which is alleged is the period of one year during which the children were both in St Anthony's Children's home at Concord. This was in 1983 when the plaintiff was 12 and the defendant was 10. 19 According to the plaintiff the children were allowed out at weekends but did not go to either of their parents. Apparently they spent the weekend time at their father's parents' home or with other relatives. The plaintiff says that during that year while they were at St. Anthony's they spent all of the school holidays with the deceased and her husband at The Entrance. The defendant refers to this period in his evidence and concedes that some of the school holidays were spent at the deceased's house at The Entrance. 20 The father of the parties gave evidence in which he responded in a general way to the allegations in respect of this period and also the period which I will consider next which is from 1983 to 1987. The effect of his evidence was that the plaintiff did not spend all of her school holidays at The entrance and would visit once or twice a year some times only for short periods. He suggested that the visits would last from two days up to a week. The father suggested that in this period and the next period he would give some money to the deceased to help support the children when they visited. No details were given and particularly it is not suggested that he turned his mind to the cost of providing accommodation. In respect of another later period when the defendant was living there full time the father conceded that although he did send monies those would not have been sufficient to support Anthony. 21 If one stand back and looks at the situation of the parties of particular note was that this is the year in which the parents were arguing over the divorce and were not looking after the children. I think it is highly likely that at least some of the holidays in this year while they were in the home were spent at the grandparents. Even though there might have been some provision of help by the father I would doubt that it would have covered in effect the cost of providing a roof over the children's head during these holidays that they spent with the grandparents. 22 The next period covers the period after 1983 and up until 1987. By the end of 1983 both of the children had moved back to live with their father and his second wife together with all her children. The plaintiff says that she would spend weekends and school holidays with the grandparents at The Entrance and that this continued until 1987. She put an estimate on the time she would spend each year with her grandparents of three months. Cross examination suggested that this would be a combination of both weekend time and holidays. To my mind it is something of an exaggeration. The defendant's answer to this evidence is that he and his sister would visit the grandfather on special occasions and during school holidays. He said that they did not spend all of the holidays but usually spent a few weeks with them. By 1987 the plaintiff was 16 and the defendant 14. I have already mentioned the father's evidence on this aspect and suggestions that he sent money. The defendant also indicated that they were given pocket money for minor matters when they did go to visit the grandparents. 23 Some evidence was also given by Gwen Simmonds a friend of the deceased. She was a member of the same bowling club and had met the deceased in about 1980. She recalls in that 1988 the plaintiff and the defendant would visit on weekends and she also recalled the defendant living there while he completed his high school education. After this was completed in 1992 she noticed the plaintiff coming up more frequently. She also recalls a statement by the deceased to the effect that the children first came when they were very small and that she used to have the children for school holidays and Christmas. 24 Considering all the evidence I do not accept the plaintiff's assertions that she spent all her holidays at this time at The Entrance. It seems more likely that she spent a large number of holidays at The Entrance residing with the grandparents and that there was some provision by the father towards her expenses the amount of which is not clear. 25 The next period which is alleged by the plaintiff is a period from 1990 to 1991. The plaintiff alleges that from the beginning of 1990 until November 1991 she was on unemployment benefits living with her father at Merrylands and in the Housing Commission house. She said that during the period she continued to stay with her grandparents at holiday times. There is no suggestion in this evidence that she spent the whole of her holidays and it is in quite vague terms. The defendant's response was that at that time he was completing Year 11. He says that the plaintiff did not spend any holidays with the grandparents but she did make a couple of visits during the period which consisted of day trips or staying overnight. Given the lack of precision in the plaintiff's evidence I am not prepared to accept that there were any substantial periods of residence during this period. 26 The Court of Appeal has considered the question of dependency in a number of cases. Initially for example in Ball v Newey (1988) 13 NSWLR at 1989 the Court did not decide whether dependence could be other than financial. 27 In Petrohilos v Hunter (1991) 25 NSWLR 343 at 346 the Court once again considered the meaning of dependency. At page 346 the Court had the following to say:- "I would respectfully disagree with the master in both respects. The word "dependent" is an ordinary English word, and whether a person is or has been wholly or partly dependent upon another is a question of fact. No doubt one of the commonest forms of dependence is a financial one, in the sense that the dependence flows from the fact that accommodation, food, clothing and other necessities or amenities of life are provided by the person who owns or is otherwise entitled to the accommodation and pays for the other things. But I do not think that the word, as used in the statute or otherwise, has this very limited meaning. In ordinary parlance, young children are properly and commonly said to be dependent on their mother as well as their father, regardless of where the money comes from. A contrary view, that young children are not dependent on their mother if she has no independent means, seems to me to be a misuse of the language. This accords with what Samuels JA said in Ball v Newey (1988) 13 NSWLR 489 at 491, that "'Dependent" in the ordinary sense of the word, means the condition of depending on something or on someone for what is needed." If the correct view were that the context of the statute requires a limitation of the word to 'financial or material' matters as McLelland J said in Re Fulop Deceased or to 'other forms of dependence analogous to but distinct from financial dependence' as Samuels JA suggested in Ball v Newey (at 491), then surely a mother's services to a young child satisfy the test. The child could not survive without the provision of those services; he or she needs them. To suggest that, in a money sense, they are valueless, is simply wrong. If the provision of accommodation by a father for a young child, that is, having the child live in a house which he owns and lives in, can make the child partly dependent upon the father, as it undoubtedly can, I am unable to see why the provision by a mother to her children, living with her, of the services essential for their well-being does not make them partly dependent upon her. In my opinion it does. The same considerations apply to a step-child or his or her step-mother, when the child lives with the step-mother and is looked after by her. I appreciate that a different view has been taken by others, as for example, by Powell J in Dunn v Public Trustee (Powell J, 1 June 1989, unreported), but I would respectfully disagree with that view. In my opinion the plaintiff was partly dependent upon the deceased, certainly for many years of her childhood and probably until her marriage, although no doubt her dependence diminished in the latter years of this period." 28 In McKenzie v. Baddeley (Court of Appeal unreported 3 December 1991) his Honour Mr. Justice Meagher, although in the minority, further discussed dependency and described it as "financial economic or material dependency not a mere emotional dependency". Importantly in that case the majority held that the word "partly" in the phrase "partly dependent" does not mean "substantially". 29 In Williams v Legge (Court of Appeal 16 March 1993) the Court in considering a case of a young child needing mothering pointed out that the absence of financial dependence is not conclusive. 30 The defendants have referred me to the decision of mine Smith v Public Trustee on 28 July 1994 when I had to consider questions of dependency as well as whether the person was part of the household. On that occasion I commented on the plaintiff's evidence that it amounted to no more than that the plaintiff was at the most looked after on a few occasions when his mother went into hospital at some time between his birth and when he was 5 years of age. I could draw no conclusion about how long or frequently this occurred. I added the comment, "The evidence so far as school holidays are concerned I think they are not of significance. Holidays are simply that and I would not think that that would assist." I concluded that even though the plaintiff was wholly dependent during the periods he was at the household the minimal extent of those visits meant that they were not such that they can be described as significant. That case was one where the question really was whether the part dependency was such as could be described as significant. 31 In the present case there are a number of periods which have to be considered. The first is the period in 1977 for a year when the plaintiff was six. As I have found there were three school holidays when the plaintiff was looked after by her grandparents. The period, particularly bearing in mind that there was also a Christmas holiday period were not insignificant and given the age of the plaintiff at this time there could be no doubt that the plaintiff was totally dependent upon the grandparents for that period. In 1983 I have concluded that there were several periods of holidays when the plaintiff resided with the grandparents. She was at that stage 12 and given her age, even if there was some provision of funds to meet her costs by her father, there would have been dependency to the extent of the care that would be required to look after a 12 year old girl and provide her with an appropriate home environment. 32 The next period is from 1983 to 1987. By the end of this period the plaintiff was 16. She had been spending several of her holidays each year with the grandparents residing there probably for up to two weeks at a time although probably at some stage a bit less. Obviously as her age increases the dependency becomes less but even by provision of accommodation and a family environment one would have thought that there was partial dependency during this period. 33 It is necessary to look at whether in fact a combination of these periods could be described as significant. The first of these was brought about because the mother simply was not available to look after the children and neither, apparently, was the father. The second was because the parents of the children were waring amongst themselves and provision had to be made for the children's accommodation elsewhere both in a home and during the holidays with the grandparents. In the last period it was no doubt because of the cramped accommodation in the father's home. In my view given that this pattern applied over quite a number of years the dependency I think could be described as more than minimal or perhaps significant. Accordingly I am satisfied that the plaintiff is an eligible person. 34 It is also necessary if the Court is to make an order in favour of the plaintiff that it should be satisfied as required by s9(1) of the Act that there are factors warranting the making of the application. In Re Fullop Deceased (1987) 8 NSWLR 679 at 681 McLelland J as he then was said the following:- "Since the sub-section applies only to certain classes of applicants, it suggests that these classes of applicants need to demonstrate some basis for their claims additional to that required of other classes. The difference between the two sets of classes of applicants, in broad terms, seems to be that the classes not affected by s9(1)(lawful and defacto spouses and children) are as such generally regarded as natural objects of testamentary recognition by a deceased (Cf The Wills Probate Administration Act 1898, s61B), whereas the classes affected by s9(1) (former spouses, and some time dependent grandchildren or household members) are as such not generally so regarded. This suggests that the "factors" referred to in the subsection are factors which when added to facts which render the applicant an 'eligible person' give him or her the status of a person who would be generally regarded as a natural object of testamentary recognition by the deceased." 35 In the present case two areas of evidence emerged which, leaving aside the contact between the plaintiff and the deceased which I have referred to above, suggests that the plaintiff has established the factors warranting the making of the application. The first of these concerns statements by the deceased about her testamentary intentions. 36 The first of these statements was said by the plaintiff to have occurred on Christmas Day in December 1996. The plaintiff and the defendant were present and the deceased in conversation according to the plaintiff said, "My will states that everything is to go to Anthony but everything is to be divided equally between you". According to the plaintiff the defendant replied with words to the effect, "Yes, Grandma, I'll do it". This conversation is denied by the defendant. I have also earlier referred to Mrs Simmonds a friend of the deceased and she gave evidence of two conversations when reference was made to property. The first is somewhat ambivalent and it may relate to a transfer but the second indicates clearly testamentary intention. The deceased apparently relayed to Mrs Simmonds a discussion she had had with a solicitor about costs of wills and putting more people in the will which is somewhat improbable. However, the conversation indicated that the plaintiff was relying in leaving her property to Anthony on his promise to look after Jasmine. Also in this period after the death of the deceased's husband there were discussions between the plaintiff and two of her friends and the deceased. One of them, Mr Grima, gave evidence of a statement made at lunch time by the deceased that when she died the house was to pass to Jasmine and Anthony. The parties' father gave evidence that about 3 months before her death the deceased said that she was going to leave everything to Anthony because if she gave it to Jasmine her savings would be spend on the wind. For present purposes I think the most important evidence is that of Gail Maree Savage. She was a home carer assistant looking after the deceased between 1994 and 1997. As she was an independent person who was able to observe the coming and going of the plaintiff and the defendant to the deceased's house and the effect that had upon the deceased. She reported one conversation when the deceased said in February 1996 after the making of the will, "I'm going to leave the property in Anthony's name. For I know he will look after Jasmine. Anthony says that Jasmine is irresponsible with money, her life is a mess and she couldn't look after herself. I know that Anthony will look after her." 37 Even putting the deceased's intentions at this level which I am quite happy to accept it indicates that the deceased was concerned that there should be some provision for Jasmine and that she was trusting, no doubt based upon statements made to her by Anthony, that he would take appropriate care of Jasmine and that she would receive something. This to my mind indicates that the deceased regarded the plaintiff as a natural object of testamentary beneficence as she was actively considering how to make provision for her. 38 The other area is the question of the help and assistance provided by the plaintiff to the deceased. 39 An overall consideration of the evidence tends to suggest that both parties visited the deceased over the years from 1992 to her death. Evidence was given by Mrs Savage of the reports made by the deceased to her about the plaintiff helping and she observed when the plaintiff was staying her cleaning the house and undertaking household chores and maintenance. There was also an occasion when the plaintiff attended with some friends and spent many hours cleaning out either the garage or a storeroom. I record that the defendant himself also, not at the same time, but on other occasions was involved in this cleaning and clearing out work. Although it is not a matter of a total care for the deceased it was at least some assistance to her. The deceased had the assistance of Home Care who also managed the mowing of her lawns and other matters about the house. 40 If one stands back and puts into context the relationship between the plaintiff and the deceased and bears in mind the periods of time during the plaintiff's upbringing that she was dependent upon the deceased, one can see that she was not a mere stranger but someone who could be described as a natural object of testamentary recognition. Accordingly, I am satisfied that there are factors warranting the making of the application. 41 In applications under the Family Provision Act the High Court has recently in Singer v Berghouse (1994) 181 CLR 201 set out the two stage approach that a Court must take. At page 209 it said the following:- "The first question is, was the provision (if any) made for the applicant 'inadequate for (his or her) proper maintenance, education and advancement in life'? The difference between 'adequate' and 'proper' and the interrelationship which exists between 'adequate provision' and 'proper maintenance' etc were explained in Bosch v Perpetual Trustee Co Limited. The determination of the first stage in the two-stage process calls for an assessment of whether the provision (if any) made was inadequate or 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. The determination of the second stage, should it arise, involves similar considerations. Indeed, in the first stage of the process, the court may need to arrive at an assessment of what is the proper level of maintenance and what is adequate provision, in which event, if it becomes necessary to embark upon the second stage of the process, that assessment will largely determine the order which should be made in favour of the applicant. In saying that, we are mindful that there may be some circumstances in which a court could refuse to make an order notwithstanding that the applicant is found to have been left without adequate provision for proper maintenance. Take, for example, a case like Ellis v Leeder where there were no assets from which an order could reasonably be made and making an order could disturb the testator's arrangements to pay creditors." 42 As required by the High Court I turn to consider the plaintiff's situation. She is a single woman aged 28 years of age and has no dependents. She shares rented accommodation and contributes to the rent of those premises. She works at Woolworths on the night shift on a casual basis and apparently on the latest information before the Court was earning $300 to $350 a fortnight. The difference between what she receives and the Social Security payments is made up by Social Security the amount of which is not clear on the evidence. She pays rent of $85 a week and $25 for food and her transportation expenses are approximately $40 a week. 43 So far as her assets are concerned the only ones that she has are her clothes, a bedroom suite, an antique record player a television and a microwave oven. She has no car or real estate. The plaintiff does not have skills apart from some computer course she has undertaking at Skill Share at Blacktown. She is registered to obtain unemployment and I accept she has been trying to obtain a job. There was some suggestion that she was doing work on a cash basis with a friend but I do not accept that this is happening. The friend pays her fares and perhaps takes her to lunch occasionally in return for some clerical work. The plaintiff is in good health although she has in the past had difficulties. Her employment for the future is not secure and it is perfectly obviously that she has absolutely nothing behind her. 44 I have above dealt with the relationship between the plaintiff and the deceased and I will not repeat it. 45 It is of course only appropriate for the court to make an order if the Court is satisfied that the plaintiff has been left without adequate and proper provision for her maintenance, education or advancement in life. In this case the plaintiff has not articulated in her affidavit evidence the way in which she says appropriate provision should be made. There is nothing to suggest that she wishes to undertake further courses nor it is suggested that there is a particular asset which she wishes to purchase or she considers should be provided. In this regard I am reminded by what was said by Sheller JA in the Court of Appeal in Singer v Berghouse on 23 July 1992. There his Honour had the following to say:- "Sheller JA (Cripps JA agreeing) said: 'I must say that I find it extraordinary that the appellant presented scant or no evidence as to her present income and outgoings or as to her intentions or needs for the future or as to what lump sum provision applying appropriate discount tables would be required to meet these claims or needs, if they existed. In my opinion, in the circumstances of this case, for the court, in the absence of any such evidence, to make an order for the payment to the appellant of a lump sum is to do no more than act on speculation and, contrary to the prohibition contained in s9(2) of the Act, to alter the deceased's disposition of his property in the absence of proof that he has inadequately provided for the appellant.'" 46 However notwithstanding this total absence of evidence some things do stand out about the plaintiff and that is that she has a difficult employment situation and has nothing behind her. Some start in life at this age may well help her to change the course of her life. 47 It is also of course necessary to consider others having a claim on the bounty of the testator. The only relevant person in this category is the defendant. The defendant is now a single man and he has no dependents. He is in regular employment earning $31,000 gross which amounts to $596.15 per week. This is expended on his outgoings in respect of his living expenses, his car and home. As I have earlier mentioned he has a property at 18 Ferndale Close, Wentworthville, worth $230,000 and a Toyota Starlet car worth $14,000. He has a home loan of $107,000 and a personal loan from Westpac in the amount of $4,000. He is 26 years of age and in good health. 48 Some of the relationship between the defendant and the deceased I have touched upon earlier in this judgment. It is apparent that he spent even more time with the deceased than the plaintiff given the period when he was residing full time with the deceased during his high school education. I do not doubt that although he moved away in 1992 that the defendant was of assistance to the deceased particularly after her husband died. 49 I have already indicated that the estate has been distributed to the defendant. Under s 24 the Court may designate as notional estate property if the Court is satisfied that an order for provision ought to be made on the application. Accordingly, it is necessary to decide this question. 50 The plaintiff certainly has a need for some provision to give her a start in life. She was perhaps not quite in the same position as the defendant who seems to have spent more time in his formative years with the deceased. Importantly the plaintiff is not in a secure financial situation in contrast to the defendant. Leaving aside questions which arise under sections 27 and 28 and taking into account the amount of the estate, the relationship between the two parties and the deceased and their personal situation, I think it would be appropriate for some order for provision to be made on the plaintiff's application. 51 The only relevant property which the Court could designate as notional estate is the property into which the deceased's estate has been translated, namely, the defendant's residence at 18 Ferndale Close, Wentworthville. Under s 28 the Court cannot designate property as notional estate unless it is satisfied that the estate is insufficient to make the appropriate provision. This is the case in the present matter. It also under s 28 shall not make an order designating as notional estate property in excess of that necessary to allow the making of provision that in a Court's opinion should be made. 52 More important in this case are the provisions of s 27 of the Act which are in the following terms:- "(1) On an application in relation to a deceased person, the Court shall not make an order designating property as notional estate of the deceased person unless it has considered: (a) the importance of not interfering with reasonable expectations in relation to property; (b) the substantial justice and merits involved in making or refusing to make the order; and (c) any other matter which it considers relevant in the circumstances. (2) In determining that property should be designated as notional estate of a deceased person, the Court shall have regard to: (a) the value and nature of property the subject of any relevant prescribed transaction or distribution from the estate of the deceased person; (b) where, in relation to any such prescribed transaction, consideration was given, the value and nature of the consideration; (c) any changes over the time which has elapsed since any such prescribed transaction was entered into, any such distribution was made or any such consideration was given in the value of property of the same nature as the property the subject of the prescribed transaction, the distribution or the consideration, as the case may be; (d) whether property of the same nature as the property the subject of any such prescribed transaction, any such distribution or any such consideration could, during the time which has elapsed since the prescribed transaction was entered into, the distribution was made or the consideration was given, as the case may be, have been applied so as to produce income; and (e) any other matter which it considers relevant in the circumstances." 53 Under s 27(1)(a) the Court has to consider the importance of not interfering with the reasonable expectations in relation to the property. Such reasonable expectations may well occur in a number of circumstances. For example, a beneficiary who receives a property may have spent money on the property or worked on the property. In the present case this is not applicable as the only matters that the defendant has attended to is helping and cleaning up rubbish in the yard. Another common area where one often sees in this matter is where there is a promise in relation to the property and the acting by an intended beneficiary on the fact of that promise. An example is a promise to leave a property provided someone works hard for many years to assist the testator. 54 In the present case none of these circumstances appear and importantly the defendant gives no evidence of any reasonable expectation. 55 Under s 27(1)(b) a Court has to consider the substantial justice and merits involved when making or refusing to make the order. In this case this is of some importance. The defendant has given evidence that he cannot borrow any more on the property because his salary will not support a higher level of borrowing. He has in fact taken out a personal loan of some $4,000 which was necessary for him to fund his defence of the litigation. Another matter that has to be considered is the impact of costs as a result of the application. Although if the defendant were successful he would probably be entitled to an order for costs against the plaintiff. It is clear that the plaintiff has no funds from which to pay such costs. Accordingly, the defendant, even if successful in the action is likely to have to bear his own costs. He may be able to do so from other assets because he owns a car worth some $14,000. However, it seems to me that it is highly likely that if the plaintiff is successful the defendant will have to sell the property. Not only will he have to meet the legacy which the Court considers appropriate but also costs of the plaintiff. 56 Under s 27(1)(c) the Court must consider any other matter which it considers relevant in the circumstances. There was tendered on the defendant's behalf the publication of the Notice under s 35 of the Family Provision Act. As I have mentioned above the deceased died on 22 February 1997, Probate was granted 19 June 1997, Notice of Intended Distribution was published on 30 June 1997 and after the sale of the property the defendant purchased a house on 28 November 1997. Thereafter it was not until 14 July 1998 that the Summons was issued. It was of course within the time allowed under s 16 of the Act. I did not have the benefit any submissions from the defendant as to what weight I should place upon the publication of the Notice of Intended Distribution. No doubt the defendant considered that the publication of the notice assisted its case in resisting the designation of property as notional estate. The Notice of Intended Distribution is in the appropriate form for the purposes of s 35 of the Family Provision Act, s 60 of The Trustee Act and s 92 of The Wills and Probate and Administration Act. Section 35 of the Family Provision Act is in the following terms:- "(1) Where the administrator of the estate of a deceased person has given notices in the manner and form prescribed by rules of court of his intention to distribute the property in the estate after the expiration of a specified time, he may, at the expiration of the time specified in the notices or, as the case may require, in the last of the notices, distribute that property having regard only to the applications in relation to the deceased person of which he has notice at the time of the distribution. (2) An administrator who distributes property in the estate of a deceased person in accordance with subsection (1) is not liable in respect of that property to any person of whose application in relation to the deceased person he did not have notice at the time of the distribution."

57 Section 35 of the Family Provision Act applies to "applications". By virtue of section 6(2) this means "an application to the court for an order for provision..." On the face of it this would not include what might be called potential claims proposed to be made under the act. As applications to the court are made by a summons joining the executor as defendant (Part 77 rule 55 and 60) in practical terms the section can only be referring to applications where proceedings have been commenced but not yet served on the defendant executor. 58 This construction is supported by the use of the word in other parts of the act. For example, ss 7, 8, 27, 28 and, more importantly, s 31. This last section refers to the "right to make an application" when dealing with releases. A reference to the working paper (1974) and report ( 1977) of the Law Reform Commission shows the predecessor of the section as clearly applying to proceedings which had been commenced. 59 It can be noted that because of s 6(4) of the Act a court, when it comes to deal with an application, can, so far as the estate of the deceased person is concerned, only make an order out of the amount of that estate which remains undistributed at the date of the order. Thus for example one cannot have a situation where the court gives a specific bequest of a particular property, which cannot be satisfied because of an earlier distribution of that property. The protection given by s 35(2) seems to be a protection against some personal liability towards an eligible person whose claim has been defeated by the actions of the executor in the sense that the court is not able to make an order because of the distribution. This seems to be a different personal liability from that to which s 60 and s 92 is directed, namely, a liability to a beneficiary on a devastavit or to a creditor on the legal representative's personal liability for the debts of the deceased to the extent of the estate assets. 60 What then is the situation if one has an executor who has notice of a proposed claim shortly after the date of death. He advertises and then distributes, say six months after the date of death. Proceedings are commenced after six months but within 18 months and at the hearing the court, because of the distribution, either refuses the application or substantially reduces the application. In these circumstances might the executor still have a personal liability from which he is not protected by s 35(2) as that section in terms only applies to applications not proposed applications? 61 This depends upon the nature of the personal liability which an executor might have which is recognised in s 35. That liability cannot be based upon a liability to a beneficiary. This is because the applicant will only become a beneficiary (see s 14) if there is a successful application. There cannot be a successful application if the property has been distributed because of s 6(4). 62 The Law Reform Commission report and the Parliamentary debates do not elucidate what is the basis of this personal liability. The section seems to be a carry over from ss 11 and 12 of the Testators Family Maintenance and Guardianship of Infants Act 1916. That act did not have an equivalent to s 14 of the Family Provision Act although s 6(3) provided for a certified copy of the order to be attached to the probate. The entitlement to the benefit of the court's order seems to be based upon the order itself, not a status as a beneficiary. See Union Fidelity Trustee Co of Aust Ltd v Montgomery 1976 1 NSWLR 134. 63 As can be seen s 11 refers to applications. Sections 11 and 12 of the Act were in the following terms:- "11(1)Where an executor or administrator has given such or the like notices as in the opinion of the court before which an application under this Act is made would have been given by the Supreme Court in its equitable jurisdiction in an administration suit for creditors and others to send in to the executor or administrator their claims against the estate of the testator or intestate, as the case may be, such executor or administrator may, at the expiration of the time named in the said notices, or the last of the said notices, for sending in such claims, distribute the assets of the testator or intestate, as the case may be, or any part thereof, amongst the persons entitled thereto, having regard to any application under this Act of which such executor or administrator has then notice. (2) Such executor or administrator shall not be liable for the assets, or any part thereof, so distributed to any person of whose application under this Act he has not had notice at the time of such distribution. (3) Nothing in this section shall prevent the court from ordering that any provision under this Act shall be made out of any assets so distributed. 12. An executor of a testator who has died prior to the passing of this Act shall not under any circumstances be liable to any person claiming under this Act in respect of any assets which such executor has lawfully distributed prior to the passing of this Act." 64 Section 12 might reflect a concern that s 11 made it clear that there was a personal liability on an executor. 65 Two cases give an indication of the basis of the personal liability. The first of these is Guardian Trust of New Zealand v Public Trustee Ltd ( 1942) AC 115. This was a case where there was a distribution pursuant to a grant after notice that an application may be made to revoke the grant. The grant was later revoked. The Privy Council at p127 said the following:- "There does not appear to be any statute in force in New Zealand that governs the case. It falls, therefore, to be decided in accordance with the well established principles of equity. One of those principles is that if a trustee or other person in a fiduciary capacity has received notice that a fund in his possession is, or may be, claimed by A, he will be liable to A if he deals with the fund in disregard of that notice should the claim subsequently prove to be well founded. This principle has, indeed, been recognised by the New Zealand legislature in dealing with cases which are closely akin to the present one." 66 Of importance is the reference to notice of potential claims. 67 In Re Simpson (1950) CH 38 at 42.43 Vaisey J who was concerned with an application under the Inheritance (Family Provisions) Act 1938 made the following observations:- "If these legacies have been paid, as I understand they have, the matter comes before me in a form which adds further embarrassment to an already embarrassing jurisdiction. I wish to be distinctly understood - I have said it before and I say it again, and I hope some notice will be taken of it - that where an application under the Inheritance (Family Provision) Act, 1938, is either pending or impending, that is to say, during the first six months after grant of representation, if it is a case in which there is any risk of such a thing happening, the executor distributes the estate at his risk. If beneficiaries come and pester him and say that they want their legacies and pressure is put on other beneficiaries to allow these anticipatory payments to be made, in my judgment it is the duty of the executor to resist any such pressure. I think it must be said that where the court has to deal with a matter under this Act the estate should be there intact . Of course, duties and debts, and that sort of thing, can be paid - there is no question about that - but no distribution to beneficiaries should be made while there is any possibility or expectation that an application under this Act will be made." 68 The six months His Honour is referring to is the period allowed for an application under the act. Noticeable again is the reference to " possible" claims. The English Act did not have a provision in the nature of s 35. These comments have been referred to with approval by McGregor J in Re Winwood (1959) NZLR 246 and in Re Gimblett (1960) NZLR 664. In the second case he considered that an executor who distributed with undue haste before the expiration of the period allowed for claims under the Act would incur a personal liability to an applicant even if he had no notice of a potential claim. At p 666 he said:- "Under the provisions of the Family Protection Act s 9 a party claiming the benefit of the Act is entitled to make application within a period of twelve months from the date of the grant in New Zealand of administration in the estate. By s 10(2) of the Act no action shall lie against the administrator by reason of his having distributed any part of the estate, if the distribution was properly made by the administrator after the expiration of six months from the date of the grant of administration in the estate of the deceased, and without notice of any application or intended application under this Act in respect of the estate. In the present case, although the administrators had no notice of any application or intended application under the Act, the estate was distributed before the expiration of six months from the date of the grant of administration. The provision is a negative provision, but in view of the fact that an applicant has a period of twelve months from the grant of administration to make application it seems to me that it was improper in the circumstances that here exist for the administrators to distribute the estate before the expiration of the period of six months from the date of grant of administration without prior notice to the widow and without full particulars being given to her of the assets. Reference can also be made to subs (6) of this section, although it is not fully applicable, whereby the Court is empowered, where the administrator has made a distribution which cannot be disturbed under the provisions of this Act, to make an order in respect of the assets or to make an order that any person to whom the assets were distributed pay to any applicant a sum not exceeding the value of the assets." 69 This personal liability was referred to by Master Windeyer, as he then was, in Heuston v Barker (1990) 19 NSWLR 354 at 362 but the question was not decided by him in that suit. The Master does not seem to have been referred to the authorities I have referred to above. Dickey on Family Provision After Death at p 178 et seq refers to the problem and a number of other authorities in support of the personal liability. 70 After the English and New Zealand decisions I have referred to there were changes to acts in a number of jurisdictions. See s 99A of the Victorian Administration and Probate Act 1958 and s 93 of the Queensland Succession Acts Amendment Act of 1968 which merely adopted the New Zealand provisions referred to in Re Gimblett. Those provisions allow early distribution in respect of dependants, distributions with consent and a distribution provided there is no notice of an intended claim after six months, the time for applications being 12 months. Section 35 has been enacted in a state of the law which recognised that there was a personal liability on an executor if he distributed an estate before the time for making claims under the Act had expired. That this is so is demonstrated by the terms of s 17 which is as follows:- "(1) On an application made to the Court by the administrator of the estate of a deceased person or by any other person who, in the opinion of the Court, has sufficient interest in proceedings in respect of the estate or notional estate of a deceased person, the Court may, if it is satisfied that, having regard to all the circumstances of the case, it is reasonable to make an order under this section, order that, in respect of an application in relation to the deceased person by a specified person, the period within which the application shall be made shall be such period (being a period expiring before the expiration of the period of 18 months after the death of the deceased person) as the Court specifies. (2) An application by a person under this section all not be deemed to be an admission by the person of any matter for any purpose. (3) An administrator shall not be regarded as being under any duty to make an application under this section." 71 In this respect the Law Reform Commission saw this procedure as avoiding a not uncommon problem of vague threats of action by aggrieved next of kin which remain unpursued with the result that the Executors cannot prudently distribute until after the expiration of the time for applications under the Act, sometimes to the detriment of needy beneficiaries. 72 In this case there is no evidence that the defendant was given notice of a proposed claim by the plaintiff prior to the distribution. 73 He was not cross-examined on whether he expected that the plaintiff might make a claim but in any event it would seem that he would have a personal liability as a result of the distribution. Accordingly on the proper construction of s 35 it cannot be said that he should have some favourable consideration because a Notice of Intended Distribution has been published. 74 On the contrary, s 17 provides a mechanism for him to achieve such protection. The only possible claimants in this case could have been his sister or his mother. He did not take the opportunity of making an application and therefore was at risk of the effects of an application. 75 If one takes this factor into account along with the matters I have mentioned when considering the justice and the merits, there is no reason why an order should not be made designating his home as notional estate to the extent necessary. There are no particular matters which need consideration under 27(2). 76 The plaintiff has sought a legacy of $50,000. In my view an appropriate provision, bearing in mind the lack of evidence, is $30,000. 77 I order that:- 1. The property 18 Ferndale Close, Wentworthville be designated as notional estate to the extent necessary to meet the legacy in order 2 and the costs in order 3. 2. The plaintiff receive out of the notional estate of the deceased a legacy of $30,000. 3. I order the defendant to pay the plaintiff's costs on a party and party basis. 4. I give liberty to apply for further enforcement of these orders or any necessary ancillary orders. 5. Interest is not to run on the legacy in paragraph 2 until the expiration of two months from today's date.

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