Diver v Neal [2008] NSWSC 304 | Case summary

3785 of 2006 KAYE AILEEN DIVER -v- JOHN NEAL and ANOR JUDGMENT 1 HIS HONOUR: These are proceedings under the Family Provision Act 1982. 2 By summons filed on 18 July 2006 Kaye Aileen Diver claims an order for provision for her maintenance, education or advancement in life out of the estate of her late stepfather Keith Trevethan (to whom I shall refer as "the Deceased"). 3 The Deceased died on 22 May 2005, aged 72. He left a will dated 19 January 2004, probate whereof was on 11 August 2005 granted to John Neal and Jan Sim, the executors named in such will (who are the Defendants to the present proceedings). 4 The inventory of property discloses the assets of the estate as being a house property situate at and known as 13 Streamside Avenue, Woollamia (to which a value of $460,000 was ascribed), moneys in various bank accounts (totalling $114,414), shares (to which a value of $8,456 was ascribed) a mortality benefit ($400), a Valiant motor vehicle (to which a value of $1,900 was ascribed) and cash on hand ($1,880). 5 The house, motor car and shares have been sold, and the costs of the estate of obtaining probate and of effecting those sales have been paid. The assets of the estate now consist of moneys totalling $624,077, which are held by the Defendants in two accounts with Credit Union Australia. 6 By his will the Deceased gave legacies totalling $80,000, one of those legacies being to the Plaintiff, in the sum of $20,000. The Deceased gave the residue of his estate equally among John Neal, Jan Sim, and Rodney Trevethan. Mr Neal (the First Defendant) and Mr Trevethan, are nephews of the Deceased, and Mrs Sim (the Second Defendant) is a niece of the Deceased. 7 In calculating the value of the estate available for distribution the costs of the present proceedings must be taken into consideration, since the Plaintiff, if successful in her claim, will normally be entitled to an order for the payment of her costs out of the estate, whilst the Defendants, irrespective of the outcome of the proceedings, will normally be entitled to an order that their costs be paid out of the estate of the Deceased. It was estimated on the part of the Plaintiff that her costs will total almost $29,000 (although that estimate was based upon a hearing occupying one day, whilst, in the event, the hearing occupied two days). It was estimated on behalf of the Defendants that their costs will total $27,280 (although that estimate also was based upon a hearing occupying one, rather than two, days). Thus it is prudent that the Court should proceed upon the basis that the net distributable estate will be in an amount of about $558,000 (upon the assumption that the only outstanding liability, being an income tax debt, will not exceed $10,000). 8 The Plaintiff, who was born on 30 September 1951, is presently aged 55. In April 1963, when the Plaintiff was aged about eleven, her parents divorced. On 21 March 1969 the Plaintiff's mother, the late Joyce Maude Phyllis Trevethan (formerly Mrs Smith) married the Deceased, with whom, according to the Plaintiff, she had been in a relationship since 1960. Before their marriage, the Deceased and the Plaintiff's mother had resided together in various rented premises at Revesby and at East Hills. Subsequently, in 1964, a house property at 2 Denny Road Picnic Point (also referred to as being located at Panania) was purchased in the name of the Plaintiff's mother. The Plaintiff, her mother, her brother Terry and the Deceased thereupon moved into residence in that property. 9 That house property was purchased in her own name by the Plaintiff's mother (to whom I shall refer as "Mrs Trevethan", although she did not marry the Deceased until about five years later). At that time the only significant asset of Mrs Trevethan was the sum of 1,600 pounds, which she had received by way of property settlement upon her divorce from her first husband (the father of the Plaintiff) on 11 April 1963. The purchase price of the house property was 4,600 pounds. The foregoing amount of 1,600 was provided by Mrs Trevethan as a deposit on the purchase of that house. Mrs Trevethan gave up work shortly before her marriage to the Deceased. According to the Deceased's affidavit of 11 July 1996, he was still in employment at the time of purchase of that house property. He said that he and Mrs Trevethan lived off his income and that the mortgage repayments on the house property were met by the interest on the sum of $25,000 which the Deceased had received as a workers compensation payment for the industrial accident he had sustained in December 1960, in which he had lost both his legs. 10 The Plaintiff left school at the age of 15, and went into employment. Whilst employed the Plaintiff paid board to her mother. 11 It was the case for the Plaintiff that, from the time when she, together with her mother and her brother, commenced to reside with the Deceased, the relationship between herself and the Deceased was equivalent to a daughter - father relationship. The Deceased, who was known to the Plaintiff as "Lofty", had lost both his legs in an industrial accident when he was aged 32, and in his later years it was necessary for him to use a wheelchair. 12 The Plaintiff departed the Denny Street property in March 1971, when she married her first husband, Dennis Walker. The Deceased paid for their wedding. That marriage came to an end about four years later, and the Plaintiff and Mr Walker divorced in 1976. The Plaintiff travelled to Europe for some months in 1975, and upon her return to Australia resided for several years in the Denny Street property. The Plaintiff's mother and the Deceased had by that time removed to the house property at Woollamia, which had been purchased in the name of the Deceased. It was that house property which comprised the substantial asset in the estate of the Deceased. In about 1980 the Deceased and the Plaintiff's mother had the residence on that property demolished and a new residence erected thereon. The Plaintiff said that she assisted with designing the house plans and decorating the interior for that new residence. 13 In about 1982 the Plaintiff's mother was admitted to hospital for a period, and the Plaintiff stayed with the Deceased during that time. The Plaintiff said that after her mother's death on 8 March 1995 she continued to maintain contact with the Deceased, with whom she and her family would occasionally stay. 14 The Deceased, although a beneficiary under his wife's will (to the very limited extent of receiving some of the contents of her home, subject to his paying for her funeral) made a claim under the Family Provision Act. That claim was settled by a deed of family arrangement entered into in 1997. By that deed (to which the present Plaintiff was a party) the Deceased received a larger share in the estate of the Plaintiff's mother, and the Plaintiff herself received only a share of the residue in that estate, ultimately receiving a little over $3,000. 15 After the divorce from her first husband in 1976, the Plaintiff subsequently married her present husband, Brian Diver, on 26 February 1983. Between them they have five children (the Plaintiff has one child from her first marriage and two from her second marriage), aged from early 30s to early 20s. The Plaintiff and her husband have also together raised four foster children. 16 It cannot be emphasised too strongly that an applicant for provision has an obligation to place before the Court as fully and as frankly as possible all information concerning her financial and material circumstances. In the instant case the Plaintiff has not done so (certainly not in her affidavit evidence). She has, however, placed before the Court a very considerable quantity of material (much of it inconsistent, incomplete and difficult of understanding - not least by the Plaintiff herself) relating to the financial and business activities of herself and her husband (in which two of her children appear also to be involved). 17 Some of that material was given first in the Plaintiff's affidavit of 31 August 2006 which was the evidence originally filed in support of the summons. Subsequently that material was brought up to date in an affidavit of the Plaintiff sworn on 19 September 2007. Much of that material was different from the material which originally had been provided by the Plaintiff. What might be described as a third account of that material emerged from the Plaintiff's oral evidence under cross-examination and from her affidavit of 18 October 2007 (by which she gave evidence in the nature of re-examination). That affidavit was sworn after the first day of the hearing and after cross-examination of the Plaintiff, but before the second day of the hearing. The Plaintiff was further cross-examined upon that affidavit. 18 Much of the evidence given by the Plaintiff concerning the manner in which the financial and business affairs of herself and her husband were conducted (through the vehicle of at least one, possibly two, companies, a trust and another entity referred to as a "settlement") was confusing. In many instances the Plaintiff conceded that she herself did not entirely understand the details of those business activities or the manner in which they were conducted. On a number of occasions she responded to questions asked of her by saying that she signed documents placed before her by her husband and by their accountant. 19 It should here be recorded that there was no evidence from the Plaintiff's husband. It was apparent from the Plaintiff's own evidence that her husband would have been in a far better position than the Plaintiff to assist the Court concerning the financial and material circumstances of the Plaintiff and himself. No explanation was offered to the Court for the absence of such evidence from her husband. The fact that no evidence was provided by him can be regarded as being deliberate on the part of the Plaintiff and her legal representatives. 20 In consequence, the evidence offered by the Plaintiff concerning her financial and material circumstances was quite unsatisfactory. It did not give to the Court the assistance which the Court expects, and is entitled, to receive from an applicant for an order for provision. 21 In the affidavit originally filed by her in support the summons, being her affidavit of 31 August 2006, the Plaintiff provided the following information concerning the financial circumstances of herself and her husband. 22 The Plaintiff said that she and her husband had the following assets: 39 Lomandera Place, Ulladulla (estimated value) $400,000 87 North Street, Ulladulla (estimated valued) $900,000 Factory unit in Minchinbury (estimated value) $300,000 Bluewaters Take Away $125,000 Sweets on the Park $90,000 23 The Plaintiff said that she and her husband had the following liabilities: Indebtedness on 39 Lomandera Place, Ulladulla $280,000 Indebtedness on 87 North Street, Ulladulla $690,000 Indebtedness on factory unit in Minchinbury $160,000 Indebtedness on Bluewaters Take Away $125,000 Indebtedness on Sweets on the Park $90,000 24 According to that affidavit, the total value of the assets of the Plaintiff and her husband were estimated to be about $1,815,000, whilst their liabilities totalled about $1,345,000. Thus they had a balance of assets over liabilities in an amount of about $470,000. 25 The Plaintiff lives at 39 Lomandera Place, Ulladulla. Her husband works in Sydney and for that purpose during the week he resides in rented accommodation at Oxley Park. He returns home to Ulladulla on weekends. The Plaintiff's daughter Katie resides with her at Ulladulla, but spends some time at the Oxley Park residence. The house in Ulladulla is owned by Brian Diver Drainage Pty Limited. The Plaintiff said that that company was the trustee of the Diver Family Trust, and that the foregoing assets and liabilities were assets and liabilities of the Trust. 26 The Plaintiff's husband conducts a drainage business, the income from which is used to service the foregoing loans on the various items of property. In addition, rental income is received from the factory unit at Minchinbury and from the residential units at North Street, Ulladulla. That rental income is $1,378 a month from the factory at Minchinbury and $2,140 from the North Street units, being a total rental income of $3,518 a month. The Plaintiff and her husband have a mortgage indebtedness to the Bank of Adelaide in an amount of $687,000, as well as an overdraft account with that bank amounting to $288,000. They make repayments on the mortgage in an amount of $4,751 a month and repayments upon the overdraft in an amount of about $2,000 a month. That is, their repayments are in a total amount of about $6,751 a month. 27 The take away food business and the sweets shop business were both acquired in 2005. At the present time the Plaintiff and her daughter Melissa work full-time in the take away business, and her son Adam works in the sweets shop. Each of Melissa and Adam receives a wage of $600 gross a week. The Plaintiff also draws a wage from the take away business when the income from that business so allows. In the period from November 2005 to February 2006 the Plaintiff received $4000 in wages. However, by August 2006 she was receiving about $200 a week, that being sufficient to meet her credit card repayments and living expenses. The Plaintiff did not expect either of those businesses to return a profit in the first year of operation. 28 In addition to working in the take away business, the Plaintiff attends to the book keeping for her husband's drainage business. Until December 2004 and for a period of five years before that the Plaintiff was employed as the canteen manager at the Shoalhaven Anglican School at Milton. She relinquished that employment as a result of an injury to her shoulder. 29 In 1994, consequent upon a downturn in the drainage business and increases in interest rates, the Plaintiff and her husband found themselves required to dispose of their assets in order to meet liabilities. The Plaintiff's husband became bankrupt upon his own petition. (It subsequently emerged that the Plaintiff also had become bankrupt.) 30 It was the evidence of the Plaintiff that she and her husband did not have any savings. She said that she relied upon credit cards in order to purchase day to day necessities. She gave evidence of various credit card indebtednesses totalling $23,300. 31 According to the Plaintiff, she and her husband through the Trust own a 2002 Hyundai Sante Fé motor vehicle (which is used by the Plaintiff) and a 2005 Holden Rodeo Utility (which her husband uses as a work vehicle). The Plaintiff estimated that the Hyundai motor vehicle was worth $14,000, whilst the Holden motor vehicle was worth $13,000. She said that her husband's work vehicle was usually replaced every two years. 32 The Plaintiff said that she had about $450 of accumulated superannuation with NGS Super, from her employment in the Sholhaven Anglican School. Her husband does not have any superannuation entitlement. 33 As I have already recorded, the foregoing information concerning the financial and material circumstances of the Plaintiff and her husband was originally provided in the Plaintiff's affidavit of 31 August 2006 which was filed in support of the summons. 34 The Plaintiff subsequently in her affidavit of 19 September 2007 purported to set forth more completely and to bring up to date details of her financial and material circumstances. She said that at that time the properties at 39 Lomandera Place, Ulladulla and at Minchinbury were both on the market for sale, since the Plaintiff and her husband were desirous of reducing their current debt levels. The asking price for the house property was $379,000, but they had not received any offers to purchase. The Minchinbury property was listed for sale in early August 2007. Shortly thereafter they received an offer $232,000 for that property, but the sale did not take place. 35 According to the Plaintiff, the valuation of the house property at Lomandera Place, was asserted to have fallen from $420,000 in February 2005 to $360,000 in September 2007, and the valuation of the Ulladulla units was asserted to have fallen from $1.2 million in February 2005 to $900,000 in August 2007. In her oral evidence the Plaintiff referred to proposals to strata the Ulladulla units. Nothing whatever concerning such proposals appeared in any of her affidavits. 36 In addition to the various assets which had already been identified, it appeared that the Diver Family Trust also owned 616 AMP shares, (having a current value of about $6400), shares in Bendigo Bank (having a current value of about $5000), a credit balance in various NAB accounts ($400), and a credit balance in ANZ accounts (in a minimal amount). 37 In addition, according to the Plaintiff, the Trust also owned a Holden Barina sedan motor car. That vehicle was purchased in 2005, and its current value was stated to be about $10,000. The Plaintiff said that it was used by the Plaintiff's son Adam, who makes the repayments thereon and that there was currently an amount of a little over $15,000 owing on that vehicle. 38 The Plaintiff provided what she said was up to date information concerning the various liabilities of her husband and herself, which in September 2007 totalled $1,363,947 (whilst in August 2006 they totalled $1,343,291). The Plaintiff and her husband were currently making monthly repayments on those various liabilities in a total amount of $12,849. 39 The Plaintiff also provided what she said was up to date information concerning the indebtedness on credit cards held by herself, her husband and Brian Diver Drainage Pty Limited, the amount of such indebtedness totalling at that time $81,136 (whilst in August 2006 the total was $44,869). Minimum monthly repayments totalling $2,423 were made in respect to such indebtedness. (No satisfactory explanation was offered as to how the increase in that indebtedness, in an amount of more than $36,000 in twelve months, had come about.) 40 The Plaintiff said that in recent times the company, Brian Diver Drainage Pty Limited, had received an assessment for land tax in an amount of $10,906 and that that amount had not yet been paid. The Plaintiff and her husband had also received various communications from the Australian Taxation Office, by way of notice of intended legal action/garnishee dated 1 June 2007, and a notice of director's liability to pay a penalty, dated 22 August 2007. Those amounts had not yet been paid to the Australian Taxation Office. The notice of intended action was said to relate to payments owing on Business Activity Statements, plus fines for late lodgement. The notice of director's liability to pay a penalty was said to relate to unpaid PAYG instalments. The Plaintiff said that she and her husband were presently seeking explanations from their accountant concerning the circumstances which had given rise to those notices being issued. 41 The Plaintiff gave evidence concerning the financial situation of the take away business and the sweets shop business, as well as of her husband's drainage business, and concerning the income and outgoings in respect to the various rental properties owned by them at Ulladulla and at Minchinbury. The Plaintiff estimated that the total operating income of the various businesses before repayment of interest and debts, was $17,498 a month. 42 The Plaintiff estimated that her total living expenses were in an amount of $225 a week and that those of her husband were in a total amount of $480 a week. She estimated that the monthly commitments and expenditure of the Trust, of the various businesses, as well as the foregoing expenses of her husband and herself, were in a total amount of $18,327. She further estimated that they had a shortfall of expenditure ($18,327) over income ($17,948) of almost $380 a month. 43 The Plaintiff referred to present outstanding liabilities in respect to land tax ($17,067); indebtedness to the Australian Taxation Office (in an estimated amount of $50,000); penalty to the Australian Taxation Office ($27,000); GST liabilities (in an estimated amount of $25,290); and an amount presently owing to the Adelaide Bank of $16,452. Those liabilities totalled $135,809. 44 The Plaintiff gave various versions of her wishes concerning any additional benefit which she might receive from the estate of the Deceased. At the outset she said that she would use any such additional moneys to repay some of the debts of her husband and herself, and to provide a retirement fund for themselves. She identified various areas for refurbishment and renovation which she said were required for their residence at Ulladulla, being a replacement of floor coverings, replacement of tiles around the swimming pool, replacement of cracked driveway, replacement of kitchen, completion of laundry tiling and renovation of bathroom. It emerged from the Plaintiff's evidence that the two residences in which are occupied by herself and her husband, being the residence which they own at Lomandera Place, Uladulla and the residence which her husband rents at Oxley Park are expensively furnished, the value of their contents being in a total amount of $200,000. 45 The Plaintiff also expressed a desire to assist her son Adam, who completed his schooling in 2004 and was hoping to go into business for himself in the fitness industry. The Plaintiff also expressed a desire to assist her daughter Melissa in undertaking an architecture course through an entity identified as OTEN. The Plaintiff gave evidence concerning the financial and material circumstances of Adam and Melissa. 46 Later, the Plaintiff stated that the immediate needs of herself and her husband were to reduce their indebtedness generally, in particular, the high interest debt. Their longer term goal was to be able to work at the take away business for a few more years, to build up the goodwill in order to make the business saleable and then to retire. The achievement of that goal depended in large part on how soon they could sell the Minchinbury units and possibly the Lomandera Place residence. The Plaintiff said that if they retained that residence, she proposed to have it renovated at an estimated total cost of $56,000 47 The Plaintiff was cross-examined concerning the nature of the financial assistance which she hoped to give to her children from any further benefit which she might receive from the estate. It emerged that she had not really directed her mind to questions of amount. She did, however, during the course of that cross-examination indicate her desire to pay off credit card indebtedness. She also stated that she had no intention of paying off all her husband's debts. The Plaintiff agreed that she had not calculated how much was required in order to prevent various creditors of her husband and herself from either foreclosing on their loans or taking steps to enforce certain guarantees. (It had earlier emerged during the Plaintiff's cross-examination that she had given guarantees for certain of the loans relating to the various business activities of her husband and herself.) 48 Whilst it was the primary submission on behalf of the Plaintiff that she should receive the entirety of the estate of the Decease, she said in re-examination to her Counsel that she "was looking around the $200,000 mark", and it was ultimately submitted that she should receive $200,000 (or $210,000). Such an amount, it was submitted, would enable her to hold onto the assets which she and her husband presently control or to dispose of those assets themselves, rather than at the instance of creditors. 49 The claim of the Plaintiff must be viewed in the light of competing claims upon the testamentary bounty of the Deceased. The chief objects of the testamentary beneficence of the Deceased are each of the two executors and Rodney Thomas Trevethan, each being a nephew or a niece of the Deceased and each being entitled to share the net residuary estate of the Deceased. 50 John Neal is aged 47 and is in good health. He is married, with two children, aged in their early 20s, each of whom still lives at home. He is by occupation an engineer. Mr Neal's wife is aged 53, and ceased employment in 2006. She is not in good health, suffering from physical and emotional problems, and is not likely to return to work. Their daughter is a full-time student. Mr Neal is presently paying her university fees, in an amount of about $9000 a year. Their son is a boilermaker apprentice, receiving only a small income. Neither of their children pays board to them. 51 Mr and Mrs Neal own their residence at East Corrimal, to which they ascribe an estimated value of $750,000. There is a mortgage upon that property, presently in an amount of about $230,000. Their other assets consist of a credit union account (about $2,000), 394 IAG shares (about $2,000); a Berlina Commodore motor vehicle, owned by Mrs Neal (to which a value of $20,000 was ascribed). Two other motor vehicles are registered in Mr Neal's name, but he said that those vehicles were actually owned by his children. Mr Neal has a superannuation entitlement, presently in an amount of $264,519. 52 Mr Neal receives a gross annual salary of $111,000, and dividends upon his IAG shares, in an amount of $126, giving him a total gross annual income of $111,126. 53 Mr Neal provided details of his annual expenses and outgoings, totalling almost $85,000. 54 As a result of an injury to his back more than 20 years ago Mr Neal has reduced mobility and capacity. He expects that that condition will result in him giving up employment at an earlier time than would otherwise be the case. Mr Neal provided details of work which was required upon his residence. 55 Mrs Jan Sim, who is a niece of the Deceased, is aged 53, and is in good health. She is married with two children, neither of whom still lives at home. Mrs Sim is employed as a cashier and performs general duties in the Dapto Leagues Club. Her husband, who suffers physical problems as a result of a hip replacement about seven years ago, is employed as a bus driver. Mr and Mrs Sim own their residence at 110 Burke Road, Dapto, to which they ascribe an estimated value of $230,000. 56 They also own a residential property at Caboolture in Queensland (which is owned as to 1 percent to Mrs Sim and as to 99 percent to her husband), to which they ascribe an estimated value of $385,000. 57 Mr and Mrs Sim jointly or severally own shares having a total estimated value of about $16,600. They also have investments of amounts of $9,600 and $35,000 (these latter amounts being intended to be used towards the property at Caboolture). Mrs Sim has a superannuation entitlement in a present amount of $23,000, and her husband has a superannuation entitlement in a present amount of $121,000. Their total assets are estimated to be about $820,000. The house property at Caboolture has a mortgage debt presently in an amount of $385,000. Mrs Sim receives a gross annual salary of $24,247, whilst her husband receives a gross annual salary of almost $42,400. 58 Mrs Sim provided details of the annual household expenses of her husband and herself, in a total amount of a little over $51,000. 59 Rodney Thomas Trevethan is also a nephew of the Deceased, and is a residuary beneficiary as to a one third share in the residue of the estate. 60 Mr Trevethan is 51 years of age. As a result of a motor vehicle accident, he suffered injury to his hip and he has experienced difficulty in walking since that accident. Mr Trevethan is in receipt of a disability pension of $512 a fortnight. He does not own his own residence, but he resides with his mother, to whom he pays $200 a fortnight in board, and, in addition, he contributes to the payment of municipal rates and electricity. Mr Trevethan's only assets consist of an amount of $28,000 held in a term deposit and about $12,000 in a bank account. 61 Each of the foregoing residuary beneficiaries gave evidence concerning the extent of his or her contact with the Deceased, especially in the later years of his life. Each of those beneficiaries disputed the evidence of the Plaintiff concerning the nature and extent of her contact with the Deceased, especially in his later years. 62 There was placed into evidence the affidavit sworn by the Deceased on 11 July 1996, in support of his claim for provision from the estate of his late wife, Joyce Maude Phyllis Trevethan (the mother of the present Plaintiff). That affidavit sets forth, inter alia, the circumstances in which the house property at 2 Denny Street, Picnic Point (or Panania) was acquired and the respective financial contributions of the Deceased and his wife towards that acquisition, and also concerning there respective contributions towards household expenses. 63 There was also placed into evidence a statement signed by the Deceased on 19 January 2004 (that being the date upon which he executed his will), which statement was witnessd by each of the two attesting witnesses to the will. That statement is in the following terms, To: Kate [sic] Diver In case you are thinking of contesting my will, my reasonings are:- · You wanted your mother's ashes buried in my backyard so you and your kids could visit on birthdays. Your kids have never been near them. · You said you would come up once a month to do my shopping and draw money for me. · You say you never come past this way but you know better. Friends see you at the races often and my house is only 5 minutes from the highway. 64 Each of the foregoing statements of the Deceased (being his affidavit of 11 July 1996 and his written statement of 19 January 2004) is admissible in evidence pursuant to the provisions of section 32 of the Family Provision Act. 65 It is in the light of the foregoing facts and circumstances that the Court must proceed to consideration of the claim of the Plaintiff. 66 I have had the benefit of receiving a chronology and written outlines of submissions from Counsel for the respective parties. Those documents will be retained in the Court file. 67 At the outset it is necessary to establish whether or not the Plaintiff is an eligible person within paragraph (d) of the definition of that phrase contained in section 6 (1) of the Act. It will be appreciated that, unless she is an eligible person, the Plaintiff does not have the standing to bring the present proceedings and her claim must therefore be dismissed. 68 The Defendants do not admit that the Plaintiff is an eligible person. Whilst conceding that the Plaintiff was for a period, from about 1963-1964 until her marriage in 1971, a member of the same household of which the Deceased was a member, the Defendants dispute that the Plaintiff was at any time dependent upon the Deceased. 69 The Deceased was retrenched from his employment in about 1977 or 1978, and the Deceased and his wife then removed to the residence at Woollamia. At that time Mrs Joyce Trevethan's children resided in the Panania house rent free, although they did make payments of the municipal rates on that house, and they paid an amount equal to the mortgage repayments on the house. 70 Following his retrenchment the Deceased received unemployment benefits and eventually an invalid pension. His wife, having only about one third of her eyesight, was in receipt of a blind pension. 71 Some time after they moved to Woollamia, Mrs Trevethian sold the Panania residence. It was from the proceeds of that sale, after paying out any outstanding amount upon the mortgage, that she purchased the home unit which she owned at her death, being situate at and known as 2/1 Astelia Street, Macquarie Fields. That home unit was then occupied by Mrs Joyce Trevethan's children, who according to the Deceased, did not make any payment for that occupation. 72 It was the Deceased's evidence that his wife's finances were always kept separate by her, and that it was the Deceased's money which supported the household and which contributed significantly to the purchase of the Denny Road property. The Deceased said that when they resided at Woollamia it was their practice for each to contribute one half to the cost of food, and for the Deceased to pay all other household expenses and outgoings. While the Deceased was in employment, however, he had met the entirety of all household expenses and outgoings, his wife retaining for herself any moneys of her own. 73 Whilst the Denny Road house property (which was the property in which the Plaintiff resided whilst living with the Deceased) was owned in the name of the Plaintiff's mother alone, nevertheless, it is quite apparent that the Deceased had made a significant financial contribution toward the purchase of that property. Of the purchase price of 4,600 pounds the Plaintiff's mother contributed 1,600 pounds and the balance of the 3,000 pounds was met by a mortgage loan. Payments (I assume of both principal and interest) in respect to that mortgage loan were made by the Deceased himself over a substantial period (or, for the period whilst only his wife's children were residing in that house, by the children of Mrs Joyce Trevethan). 74 To the extent that dependency connotes the provision of, inter alia, shelter and sustenance, I am satisfied that, at least for the period while the Plaintiff, her mother and the Deceased were residing together in the Panania residence, the Plaintiff was partly dependent upon the Deceased. 75 That being so, I am satisfied that the Plaintiff is an eligible person within paragraph (d) of the definition of that phrase contained within section 6(1) of the Family Provision Act. As such, she has the standing to bring the present proceedings. 76 It was submitted on behalf of the Plaintiff that the financial position of the Plaintiff and her husband is on a knife's edge, and that the most pressing need of the Plaintiff is to repay the financial liabilities of herself and her husband and their company's credit card debts (totalling about $81,000) and the liabilities due to the Australian Taxation Office, due for land tax and due to the Adelaide Bank, totalling about $135,000. 77 It must not be overlooked that the Plaintiff under the will receives a legacy of $20,000. 78 The payment to the Plaintiff of any significant additional sum from the estate of the Deceased would essentially go to meeting creditors of the Plaintiff and, largely, of her husband. It would not operate as provision for the Plaintiff's maintenance or advancement in life (see Caska v Caska [1999] NSWSC 289, 1 April 1999, a judgment of Bryson J (as he then was)). 79 In carrying out the first stage in the two-stage process identified by the High Court of Australia in Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201 at 208 -210 (the correctness of which test was affirmed by the High Court in Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191) the Court must determine whether in consequence of the provisions of the will of a testator the applicant has been left without adequate provision for her proper maintenance. 80 The High Court said, at 209 -210, that the determination of the first stage calls for an assessment of whether the provision (if any) made was inadequate for what, in all the circumstances, was the proper level of maintenance etc. appropriate for the applicant having regard, amongst other things, to the applicant's financial position, the size and nature of the deceased's estate, the totality of the relationship between the applicant and the deceased, and the relationship between the deceased and other persons who have legitimate claims upon his or her bounty. 81 It should be appreciated that the Plaintiff must establish her own claim upon its own merits. She cannot enhance her claim by, for example, establishing, if such be the case, a lack of contact between the Deceased and the beneficiaries. As the chief chosen objects of the testamentary beneficence of the Deceased, they do not need to prove anything. 82 It will be appreciated that any additional provision for the Plaintiff will impact upon the provision made by the Deceased for the three residuary beneficiaries. Whilst none of those three persons is an eligible person in relation to the Deceased, they are the chosen objects of the substantial testamentary beneficence of the Deceased. It is important that the considered wishes of a testator should not be overlooked and should not be treated as being of little significance. The Court must constantly recognise that the discretion vested in it by section 7 of the Family Provision Act is a qualification upon the general freedom of testation which entitles a testator to dispose of his estate as he chooses. It is not enough for an applicant to establish, as here, that she is an eligible person, and then, in the absence of any other eligible persons, to submit that because of asserted financial difficulties, her position should be preferred to that of the chosen objects of the testamentary beneficence of the Deceased. 83 It will also be appreciated that the Deceased himself expressly recorded the reasons why he had not given to the Plaintiff a greater benefit than he did. It should also not be overlooked that he gave to the Plaintiff a legacy of $20,000, and that a legacy in that amount cannot be regarded as being in any way a nominal or derisory benefit. 84 It is quite apparent that in his latter years the Deceased, in ill-health, without legs, largely confined to a wheelchair, dependent upon neighbours and relatives for his shopping and banking, was extremely disappointed in the conduct of the Plaintiff in disregarding his existence. 85 In the instant case, having regard to all the circumstances, including the various matters referred to by the High Court in the foregoing passage, I am not satisfied that the Plaintiff has been left without adequate provision for her proper maintenance. 86 It will be appreciated that, since she is an eligible person only within paragraph (d) of the foregoing definition, the Plaintiff must, pursuant to section 9 (1) of the Act, establish that there are factors which warrant the making of the application. 87 Such factors were described by McLelland J (as he then was) in Re Fulop Deceased (1987) 8 NSWLR 679 at 681 as being, 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 a deceased. 88 It was submitted on behalf of the Plaintiff that the factors which warrant the making of the present application were that, in effect, the relationship between the Plaintiff and the Deceased was in the nature of a daughter to a father. 89 However, the Plaintiff ultimately agreed that she had had no contact with the Deceased after 2003, that is, for the last year and a half of his life. It was during that period that the Deceased was declining in health, and was in considerable need of practical assistance in looking after himself. Despite the Plaintiff's assertion that she maintained regular and frequent contact with the Deceased after the death of the Plaintiff's mother in 1995, I am satisfied that there was relatively little contact between them from that time. It is quite apparent that, if the Plaintiff had so wished, she could have maintained far greater contact than she did with the Deceased in his declining years. I am satisfied that from 2000 onwards the Plaintiff's contact with the Deceased was minimal. She said that she had a hundred reasons for that, and that she was a very busy woman. However, her hundred reasons and her busyness did not prevent the Plaintiff from passing close to the Deceased's residence on visits to a nearby race track; but she did not visit him on those occasions. The Plaintiff conceded that she did not choose to have any contact with the Deceased in the last eighteen months of his life, or to make any enquiry about him of friends and neighbours during that period, or, indeed, for five months after his death. Neither did any of the Plaintiff's children have any contact with the Deceased throughout that period. The various excuses offered by the Plaintiff for her lack of contact with the Deceased in his declining years were no more than that - merely excuses. 90 The Plaintiff may have been treated by the Deceased as a daughter from about 1963 until about 1971, for a period of about eight years. Once the Plaintiff married the nature of their relationship changed. I am not satisfied that the fact that the Plaintiff had been a member of the same household as the Deceased and had been partly dependent upon the Deceased during a period of about seven years which had ceased almost 34 years before the death of the Deceased, constitutes a factor which warrants the making of the present application. 91 I am not satisfied that the Plaintiff has established the existence of factors warranting the making of the present application, being any factors beyond those which establish the status of the Plaintiff as an eligible person in relation to the Deceased. The absence of such factors is determinative of the Plaintiff's claim. Unless such factors can be established, the statute requires that the Court "shall refuse to proceed with the determination of the application and to make the order". 92 But even if, contrary to my foregoing conclusion, I were to be satisfied that there are such factors warranting the making of the application, it seems to me that any additional provision which might be made for the Plaintiff would have the practical effect, not of providing for the Plaintiff's advancement in life, but of benefiting the creditors of the Plaintiff and her husband. 93 I have considerable doubt whether an additional legacy in amounts totalling in excess of $240,000 (for the repayment of the various debts and financial liabilities of the Plaintiff and her husband) would constitute provision for the Plaintiff's maintenance or advancement in life. 94 Further, the laudable desire of the Plaintiff to assist two of her adult children (Melissa and Adam, the children of her second marriage), by providing deposits for residences for them is not a relevant need of the Plaintiff. It is not an object for which the Court should make provision, since it does not constitute maintenance, education or advancement in life of the Plaintiff. 95 But, in any event, the diminution in the residuary estate by that amount, with the consequence that the benefit to be received by each of the residuary beneficiaries would be reduced by more than $80,000 would not, in my conclusion be justified, and would not be an appropriate exercise of the discretion vested in the Court. 96 The Deceased clearly did not wish the Plaintiff to contest his will and expressly set forth his reasons for giving to her no more than the not inconsiderable legacy of $20,000. I am satisfied in the circumstances of this case that the wishes of the Deceased in that regard should be respected. 97 Accordingly, I proposed to dismiss the application of the Plaintiff. 98 I have not heard any submissions concerning costs. Accordingly, unless within seven days of the date hereof either party arranges with my Associate for the matter to be listed for argument as to costs, I make the following orders:

I order that the summons be dismissed.
I order that the Plaintiff pay the costs of the Defendants.
I order that the Defendants be entitled to retain from the estate of the late Keith Trevethan ("the Deceased") the difference between the costs of the Defendants on the indemnity basis and the costs which the Defendants may recover pursuant to order 2 hereof.
The exhibits may be returned. **********

Diver v Neal

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Decision date

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Judgment (10 paragraphs)

Parties

Cases Cited (7)

Cited By (15)