Estate Wight; Wight v Robinson

Judgment - EX TEMPORE (Revised) 1The plaintiff, the widow and sole beneficiary of the estate of the late Andrew John Wight, commenced these proceedings for revocation of the grant of probate made by this Court (in common form) to the defendant. She applied for an expedited hearing of the proceedings. That application has led to an agreement between the parties for resolution of the proceedings on a basis which, inter partes, is without admissions on both sides. 2The plaintiff applied for relief, and (without admissions) the defendant consents to it, because: (a)time is running against the estate in relation to a claim for damages it may have in the United States of America; and (b)administration of the estate has been impeded by claims, and counter-claims, of obstruction made by the plaintiff and the defendant each against the other. 3It is not necessary to set out the parties' complaints against one another or, indeed, to resolve them. It is sufficient for the present to record that I accept that there is a bona fide dispute between the parties, and that it is of such a nature, and scope, that it has impeded, is impeding and, if unchecked, is likely to continue to impede administration of the deceased's estate. 4The parties have agreed that "there is no impediment" to the plaintiff being appointed as administratrix of the estate. They have, indeed, settled upon precise "consent" orders for the approval of the Court. 5Although the parties disagree about the reasons for delays in administration of the estate, they do agree that the prospect of expiry of a US limitation period requires that their impasse be broken. 6The defendant maintains in these proceedings, and it is not necessary for the Court to challenge his contention, that he has diligently persisted in his administration of the estate (despite conduct of the plaintiff he perceives to have been counter-productive and meddling) out of a sense of loyalty and duty to the deceased, a long-standing friend and work colleague. 7The plaintiff maintains, and it is not necessary in this judgment to challenge her contention, that he has defaulted in his responsibilities as an executor. 8From these competing positions, the nature of the parties' bona fide dispute can be discerned. 9The defendant accepts that, as the deceased's sole beneficiary, the plaintiff has the greatest personal interest in administration of the estate, and that her appointment as administratrix of the estate would be appropriate. 10The parties also agree, and I accept, that the process of administration of the estate has not passed from the performance of executorial duties to the holding of estate property on trust for the plaintiff. Estate assets remain to be got in. There has been no formal declaration (pursuant to s 11 of the Trustee Act 1925 NSW or otherwise) that all executorial duties with respect to estate property have been duly performed. 11The procedure for "removal" of an executor differs from that for the removal of a trustee: Juul v Northey [2010] NSWCA 211 at [237]-[239]. 12In formal, historical terms, the former requires an exercise of probate jurisdiction; the latter, equitable jurisdiction. 13Upon an exercise of probate jurisdiction, the Court (in exercise of its inherent jurisdiction, as explained in Bates v Messner (1967) 67 SR (NSW) 187 at 189 and 191-192) orders that a grant of probate made to an executor be revoked so that a grant of administration can be made to another person. 14Upon an exercise of equitable jurisdiction (in exercise of its inherent jurisdiction or a statutory power), the Court orders that a trustee be removed from office and, as may be appropriate, replaced by another. 15This difference in procedure reflects the functionality, as well as the historical derivation, of the jurisdiction exercised by the Court. 16A grant of probate, or another form of administration, is in the nature of a grant of title to property, affecting the entitlements of everybody with a claim against an estate, with an associated public interest element in a dealing with property. A grant of administration is a court order that serves, in concept and in the work-a-day world of estate administration, as an instrument of title. 17The interest of a beneficiary before completion of executorial duties is an entitlement to due administration of the estate, rather than an interest in particular assets of the estate: Commissioner of Stamp Duties (Qld) v Livingston [1965] AC 694 at 717C-F, upholding Livingston v Commissioner of Stamp Duties (Qld) (1960) 107 CLR 411 at 435, 451 and 459. 18Upon an application for revocation of a grant of probate, the interests of creditors of the deceased, as well as those of his or her beneficiaries, need to be taken into account, as does the fact that the deceased may have exercised deliberate, personal judgment in selection of his or her executor: Williams v Williams [2004] QSC 269 at [45]; Baldwin and Neale v Greenland [2006] QCA 293 at [44]-[45]; Bates v Messner (1967) 67 SR (NSW) 187 at 191; Mavrideros v Mack (1998) 45 NSWLR 80 at 107F-108C. 19The Court will not lightly interfere with a will-maker's personal selection of executor: Baldwin and Neale v Greenland [2006] QCA 293 at [44]-[45]; Morgan v Macrae [2001] NSWSC 1017 at [17]-[26]; Labraga v Pomfret [2005] NSWSC 973 at [113]-[115]; Williams v Williams [2004] QSC 269 at [45]. That may be so even if acceptance of the office of executor exposes the testator's choice of legal personal representative to a conflict between duty and interest: Horden v Horden [1910] AC 465 at 475, citing Vyse v Foster (1874) LR 7 HL 318 at 332. 20Once the character of a legal personal representative passes from that of an executor to that of a trustee, his or her obligations shift in focus from the deceased to his or her beneficiaries. 21Depending on the terms of any testamentary trust involved in the particular case, a beneficiary may have an entitlement to call for trust capital so as to put an end to the trust. The rule in Saunders v Vautier (considered in CPT Custodian Pty Ltd v Commissioner of State Revenue (2005) 224 CLR 98 at 118-121) is a particular illustration of this shift in focus. 22Whereas, upon consideration of an application for removal of a trustee, subject to the terms of the trust, a (if not the) paramount consideration is the welfare of beneficiaries of the trust (Miller v Cameron (1936) 54 CLR 572 at 575, 579 and 580-581; Letterstedt v Broers (1884) 9 App Cas 371 at 386-387), upon consideration of an application to remove an executor due regard has to be given to the entitlements of others, including the will-maker's express choice of an executor. 23The grounds upon which the Court may, in its discretion, revoke a grant of probate (especially a grant in common form) are not closed: Richards v Rearden [2006] NSWSC 1252 at [16], citing Neilson v Public Trustee (8 May 1992, unreported, BC 9201888 at 14-15). 24A grant of administration in common form is in the nature of an interlocutory judgment, open to be revoked at any time upon a proper case being established: Caldar v Public Trustee [2003] NSWCA 187 at [5]. 25Whether the fact that a grant may have been made in solemn form makes any substantial difference, on an application for revocation directed to "removal" of an executor, may depend on the facts of the particular case, having regard to the course of litigation leading up to the grant. In any event, the primary focus is on the need for "due administration" of the estate. 26Illustrations of cases in which the Court's power of revocation has been exercised can be found in Estate of Erminia Agnes; Rogers v Rogers [2009] WASC 358 at [23]-[31]. 27On an application for revocation of a grant of probate, the Court must consider the particular facts of the particular case, with an eye to the ongoing administration of the estate as well as the range of interests affected by the current, and any prospective, regime for administration. 28It is not necessary in these proceedings to make any finding of misconduct or default on the part of either the plaintiff or the defendant: Profilio v Profilio [1999] NSWSC 657 at [18]-[29]. It is sufficient for disposition of these proceedings that: (a)there is and has been a bona fide dispute, which the parties, on reasonable grounds, accept has affected the due administration of the Estate and is likely, if not resolved, to continue to do so: Grant v Binetter [2010] NSWSC 278 at [23]; Smith v Magi (No 2) [2011] NSWSC 272 at [14]. (b)the working relationship between the plaintiff and the defendant necessary to a due administration of the estate has broken down, frustrating the process of administration: Conroy v Smith [2007] QSC 182 at [19]-[24]; In the Estate of Raymond Francis Stuart (Deceased) [2009] SASR 399 at [24]-[26]; In the Estate of Helene Josephine Storch (Deceased) [2013] SASC 129 at [8]-[12]. (c)the plaintiff is the sole beneficiary of the deceased, and the person with the greatest personal interest in the due administration of the estate. (d)in all the circumstances, it is appropriate that she be charged with future administration of the estate, and there is no compelling, competing reason for withholding that responsibility from her. 29The appropriate course, I find, is to approve the orders proposed by the parties for a final resolution of the proceedings. 30The consequences of revocation of a grant of probate are governed by s 40D of the Probate and Administration Act 1898 NSW. I do not apprehend that the orders about to be made have any inconsistency with the statutory regime. Consequential relief can be sought, and may be granted, if necessary to give effect to, or enforce, this judgment: Morgan v Macrae [2001] NSWSC 1017 at [24]. 31Accordingly, I make the following orders and notations: (1)Order that the grant of probate made in proceedings 2012/169726 on 1 June 2012 to the defendant of the Will executed on 24 January 2012 ("Will") of the late Andrew John Wight be revoked. (2)Order that letters of administration with the Will annexed be granted to the plaintiff. (3)Order that the defendant deposit in the Registry the grant made to him. (4)Order that the property in the estate presently held by the defendant as executor vest in the plaintiff as administratrix of the estate. (5)Order that the administration bond be dispensed with. (6)Make no order as to the plaintiff's costs of the proceedings. (7)Make no order as to the defendant's costs of the proceedings. (8)Note the agreement between the parties recorded in a document signed by the solicitor for the plaintiff and by counsel for the defendant today and initialled by me and placed with the papers.