//
[2014] VSC 427
General information, not legal advice.
Supreme Court of Victoria
2014-09-12
SIFRIS J
Original judgment source is linked above.
TESTATOR'S FAMILY MAINTENANCE - Application under Part IV of the Administration and Probate Act 1958 - Deceased survived by siblings and two adult children - Deceased effectively left a life interest in the Estate to a sibling with the residue left to the grandson of the deceased - Adult children of the deceased not beneficiaries under the Will - Claim by the adult children of the deceased - Whether the deceased had a responsibility to make provision for the adult children - Competing claims against the Estate of the deceased - Deceased estranged from adult children - Whether estrangement a disentitling factor - Conduct of adult children not responsible for estrangement.
1 Teena Leanne Hartnett ('Teena') and Cynthia Denise Hartnett ('Cynthia') are the daughters of the late Barbara Ellen ('the deceased').
2 Teena and Cynthia ('the plaintiffs') bring this application pursuant to Part IV of the Administration and Probate Act 1958 ('the Act'). They contend that the deceased failed to make adequate provision in her Will ('the Will') for their maintenance and support. The Will did not make any provision for either Teena or Cynthia. In fact, the Will specifically excludes them as beneficiaries.
3 Barbara Ellen made her last will on 28 June 2012 and died less than a month later on 23 July 2012.
4 Dorothy Pauline Taylor ('Dorothy') and Kathleen Pearl Walker ('Kathleen'), the first and second defendants respectively are sisters of the deceased. Nicole Watson Spry ('Nicole') is the sister in law of the deceased. She is married to the deceased's brother. Dorothy, Kathleen and Nicole ('the defendants') are the executrixes of the Will and the Trustees of the Estate of the deceased.
5 Probate of the Will of the deceased was granted to the defendants on 23 November 2012.
6 At the commencement of the trial Kathleen, separately represented, made application to be joined as a plaintiff for the purpose of making her own application under Part IV of the Act ('Kathleen's application'). The application was dismissed. I indicated that reasons would be given in this judgment. The reasons appear later in the judgment.
7 The Will of the deceased is in the following terms:
(a) failed or ceased personally to occupy the said property as principal residence;
(b) failed to pay all rates and other such outgoings from time to time payable in connection with my said property within a reasonable time;
(c) failed to keep the said property in good order and condition (excluding structural repairs) to the satisfaction of my Trustees; or
(d) failed to keep the said property insured against such risks and for such amounts as my Trustees shall reasonably require with an insurance company approved by my Trustees
AND from and after the distribution date the property is to be sold and the net proceeds remaining paid as follows:
(i) $200,000 to KATHLEEN PEARL WALKER
(ii) the balance to [the deceased's grandson]
8 The main asset of the Estate is a house situated at 5 Tilbury Court, Cranbourne valued at approximately $330,000 ('Tilbury Court'). For some reason which has not been adequately explained and despite the limited interest provided for in the Will, Tilbury Court has been transferred into Kathleen's name as sole proprietor. Prior to the commencement of the trial Kathleen undertook to abide by any order of the Court.
9 The Estate also includes cash of about $60,000 and a vehicle valued at $20,000.
10 Although the Will refers to an insurance policy (the 'insurance policy'), the policy and its proceeds do not form part of the Estate of the deceased. The policy was apparently[1] taken out by Kathleen on the life of her sister, the deceased.
11 Teena is 43, divorced and in a poor financial position. Teena has no one supporting her financially and does not own a house. Her assets comprise a motor vehicle, superannuation of approximately $21,000 and an income of approximately $50,000 per year. On the liability side Teena has some credit card debt.
12 Teena continued to see her mother until about December 2011 when the two had an argument after which they had no contact until a hearing, unrelated to these proceedings, in the Victorian Civil and Administrative Tribunal ('VCAT') in May 2012 at which time the deceased was hostile towards Teena.
13 Teena's claim against the Estate is based on the deceased having a moral obligation to her as one of the deceased's two adult daughters.
14 Cynthia is 42, a single parent and in a poor financial situation. Cynthia has no one supporting her financially and does not own a house. Her only asset of some significance is a share of a real estate business for which she works as an estate agent and earns approximately $2,022 fortnightly. Cynthia has some credit card and personal loan debt, is in receipt of a family tax benefit and has approximately $44,000 in superannuation.
15 Cynthia continued to see her mother until an estrangement occurred in about 2008 as a result of Cynthia requesting that the deceased not drink alcohol in the presence of her son (the 'deceased's grandson'). In 2008 Cynthia subsequently telephoned her mother who was hostile towards her.
16 Cynthia's claim against the Estate is based on the deceased having a moral obligation to her as one of the deceased's two adult daughters.
17 The evidence in this case was not entirely satisfactory. Many allegations, particularly in relation to financial matters, were not supported by documentary evidence, especially in relation to the evidence of the defendants.
18 Teena gave evidence that both she and her sister had been supported and provided for by their mother when they were growing up. Teena and her mother had fallen out around six months before the death of the deceased. Teena found her mother to have become quite unpredictable. Teena had made efforts to contact her mother following the falling out however the deceased was hostile towards her. Teena claimed her mother's refusal to cease drinking in the presence of her grandson was a contributor to the falling out between Cynthia and the deceased. Teena confirmed that the deceased had gifted her $10,000 in the past.
19 Cynthia also gave evidence that their mother had provided for and supporter her and Teena as young children and had given her $10,000 in the past. Cynthia had jointly owned a property with her mother. The deceased's share of the proceeds of the jointly owned property had been sufficient for the deceased to buy Tilbury Court outright.
20 Cynthia also gave evidence that she had had problems with alcohol in the past claiming she was "a product of her environment". Cynthia and the deceased had regularly drunk alcohol together. Cynthia became an alcoholic following the death of the father of her son, the deceased's grandson, by suicide. Cynthia later sought counselling and attended Alcoholics Anonymous. Both the deceased and Kathleen had supported Cynthia's decision to cease drinking alcohol. In relation to her falling out with the deceased, arising from the deceased's refusal to stop drinking around her grandson, Cynthia said that she
never thought [the deceased] would die without a reconciliation of our relationship and also for her to see her grandson, I always thought my mother would see the benefits of [the deceased's grandson] being brought up in a stable home, without alcohol, without any alcohol influence whatsoever ... .
21 Cynthia claimed that both her parents had been alcoholics, that she had grown up 'thinking that everybody drinking was just normal because the whole family did it' and that she believed alcohol had been the source of 'a lot of emotional turmoil in our lives'.
22 Dorothy gave evidence that she saw or spoke to the deceased on a weekly basis. Dorothy's evidence included that the plaintiffs' father had been an alcoholic and that the deceased had been an alcoholic for either the last five or two years of her life. Dorothy said the deceased's drinking increased when the deceased retired. Dorothy gave evidence that Cynthia and the deceased had a close relationship until the two fell out in 2008 and that the deceased wanted to retain the right to drink alcohol in the same house as the deceased's grandson. Dorothy claimed that from a time before the deceased retired, around when she bought Tilbury Court, it was the deceased's intention to leave Tilbury Court to the plaintiffs. Dorothy claimed that the deceased later told her that she had changed her mind and wished to change her will due to the way she had been treated by the plaintiffs and elaborated that she had had a fight with Cynthia over the deceased's grandson. Dorothy was confused as to the date when the deceased had told her about her change of mind about her will.
23 Nicole gave evidence that she was eighteen years of age when she met the deceased. Nicole moved interstate in 1992 and returned to Victoria in 2011 and saw the deceased a 'handful' of times in the interim; a total of five or six times in almost 20 years. Nicole and her husband lived with the deceased for a period in the early 1990's then had little to do with the deceased between 1992 and 2011. In 2011 Nicole and her husband again lived with the deceased for 11 months. Nicole agreed that Teena continued to see the deceased until late 2011. Nicole gave evidence that the deceased decided to drink herself to death having refused to reconsider her position as to whether she would stop drinking or not.
24 Kathleen works a minimum of 15 hours per fortnight as a medical receptionist and is in receipt of a carers' pension. Kathleen currently cares for her sixty-five year old twin step-sisters ('the twins'). The twins are intellectually and physically disabled. The twins moved in with Kathleen and the deceased in June 2012 following the death of the mother of Kathleen and the deceased with whom the twins had previously resided. Kathleen manages the pensions the twins receive. Kathleen claimed that finding suitable rental accommodation would pose some difficulty for Kathleen and the twins were Tilbury Court to be sold.
25 Kathleen gave evidence that the deceased and Cynthia had a close relationship until about 2007. Kathleen said that the deceased wanted to retain the right to drink alcohol in the house when the deceased's grandson was present and that Cynthia gave up alcohol because it caused her to act in a destructive manner.
26 Kathleen also claimed that the deceased had a previous will in place between 2002 and 2008 in which the deceased bequeathed Tilbury Court to Cynthia and the deceased's grandson. Kathleen said she was content with Tilbury Court being bequeathed to Cynthia and the deceased's grandson as she was to get the proceeds of the life insurance policy she had over the deceased's life and the deceased's share of another property Kathleen and the deceased had purchased for their mother. Kathleen claimed to have spent $70,000 on improvements to Tilbury Court in 2003 and another $40-50,000 in 2012 after the death of the deceased. Kathleen produced no documentary evidence to substantiate these claims. Nor did Kathleen provide documentary evidence of having split the costs for 'living expenses', rates and some maintenance with the deceased. Kathleen confirmed that over the period she lived with the deceased at Tilbury Court she never paid any rent to the deceased.
27 Evidence tendered by the plaintiffs confirmed that, despite her firm denial, Kathleen had received money from the deceased in the months before her death. These amounts comprised a cash deposit to Kathleen's benefit ($4,348), paying off Kathleen's personal loan ($9,168.12) and a credit card in Kathleen's name ($6,483). When faced with this evidence Kathleen reluctantly accepted the position and said she couldn't remember. Her evidence was most unsatisfactory. Kathleen also said she cashed in around $40,000 of her own superannuation in the six months after the deceased passed with which she bought a new car and went on a cruise. Finally, Kathleen said that due to the conduct of the plaintiffs she had decided, contrary to the wishes of the deceased (so far as they were relevant) as expressed in the Will, not to make any payment to the deceased's grandson out of the sum Kathleen received from the life insurance policy.
28 Dr McClellan had been the deceased's treating General Practitioner ('GP') since 15 August 2002. Dr McClellan gave evidence that the deceased had an alcohol dependency issue since 2003. Dr McClellan's evidence, drawn from the deceased's medical records, included a blood test which returned elevated liver enzyme levels which were 'probably due to alcohol' (in April 2003). Another record noted '[d]rinking excessively, needs to drink to sleep' (in December 2003). Dr McClellan said she and other doctors offered the deceased alcoholic rehabilitation services and psychiatric review referrals at most consultations. Following a referral from Dr McClellan the deceased did attend a gastroenterologist in relation to abnormal liver function tests in 2006 at which time the deceased's suffered from liver disease at least partly caused by her alcohol consumption. Aside from the visit to the gastroenterologist the deceased, who Dr McClellan thought was open to being treated for her alcoholism at times, never followed through with seeking any such treatment.
29 Dr McClellan gave evidence that the deceased's alcohol intake increased significantly in the two to three years before her death and that she had said she wanted to drink herself to death. The deceased also declined treatment for other conditions during this time. During this time Dr McClellan warned the deceased that she would die if she maintained her increased level of alcohol consumption. As a reason for the deceased's increased drinking Dr McClellan gave evidence that the deceased was emotionally distressed by the conflict between herself and her daughters and her estrangement from them and her grandson. Dr McClellan said that she thought the deceased felt she was in a hopeless situation because the deceased needed treatment for alcoholism and refused to seek treatment and as such was prevented from seeing her grandson.
30 Dr McClellan had also been Cynthia's GP in the past and knew that Cynthia had had an alcohol addiction. Dr McClellan said that she could appreciate that living with an alcoholic mother would be difficult and stressful. In relation to Cynthia's request of the deceased, that the deceased not drink alcohol around her grandson, Dr McClellan said that she also appreciated the need for a person who had struggled with alcohol addiction themselves to 'set boundaries' and that 'most parents would not want their children to see their grandparent inebriated.'
31 I find, as is indeed common ground, that the deceased made no provision for her children. I find further that the plaintiffs are in a relatively poor financial position and require support.
32 I find that the deceased had a serious problem with alcohol well before her estrangement from her daughters and probably from 2003. I also find that after the falling out with Cynthia the problem got worse. Finally, although not strictly a factual matter, I am not prepared to attribute any blame to Cynthia for the position she took in refusing to permit the deceased to see her grandson.
33 I find that Kathleen as a joint executrix of the Will, beneficiary of the Estate and recipient of not insubstantial benefits prior to the death of Barbara Ellen has not been entirely frank and honest. The extent to which she has benefited from the Estate and Barbara Ellen prior to her death, is less than clear, and probably deliberately so.
34 Part IV of the Act sets out the power of the Court to make orders as to maintenance. Section 91(4)(a)-(d) of the Act relevantly sets out a two-stage test (the 'two-stage test') which requires that:
(4) The Court in determining -
(a) whether or not the deceased had responsibility to make provision for a person; and
(b) whether or not the distribution of the estate of the deceased person as effected by -
(ii) the operation of the provisions of Part I, Division 6; or
(iii) both the will and the operation of the provisions -
(c) the amount of provision (if any) which the Court may order for the person; and
makes adequate provision for the proper maintenance and support of the person;
(d) any other matter related to an application for an order under subsection (1) -
35 Sections 91(4)(e)-(o) contain matters which the Court must have regard to in considering the questions raised in ss 91(4)(a)-(d) as outlined below.
36 Kathleen's application relied on s 99 of the Act which is in the following terms:
No application shall be heard by the Court at the instance of a party claiming the benefit of this Part unless the application is made within six months after the date of the grant of probate of the will or of letters of administration (as the case may be) ...
...
... the time for making an application may be extended for a further period by the Court after hearing such of the parties affected as the Court thinks necessary, and this power shall extend to cases where the time for applying has already expired ...
The Relationships Act 2008 (Vic) (the 'Relationships Act')
37 Counsel for Kathleen raised section 35(2) of the Relationships Act which sets out criteria for determining whether a domestic relationship exists:
(2) In determining whether a domestic relationship (other than a registered domestic relationship) exists or has existed, all the circumstances of the relationship are to be taken into account, including any one or more of the following matters as may be relevant in a particular case -
(a) the degree of mutual commitment to a shared life;
(b) the duration of the relationship;
(c) the nature and extent of common residence;
(d) whether or not a sexual relationship exists;
(e) the degree of financial dependence or interdependence, and any arrangements for financial support, between the parties;
(f) the ownership, use and acquisition of property;
(g) the care and support of children;
(h) the reputation and public aspects of the relationship.
(3) For the purposes of this Part, a person is not a domestic partner of another person only because they are cotenants.
38 Counsel for the defendants referred to McKenzie v Topp[4] where Nettle J (as he then was) said:
Jurisdiction to make an order under Part IV
[15] Jurisdiction to make an order under Part IV of the Administration and Probate Act 1958 is dependent upon being satisfied that the deceased had responsibility to make provision for the plaintiff and also upon being satisfied that the will does not make adequate provision for the proper maintenance and support of the plaintiff. Each condition invokes consideration of the question of what is the provision that a wise and just stepmother would have thought it her moral duty to make in the interests of her stepson had she been fully aware of all the relevant circumstances. That question is to be answered as at the date of death according to the standards of a wise and just testatrix - or, in other words, according to the standards of a fair and reasonable woman in the community - and in answering the question the court is bound to have regard to the factors adumbrated in s. 91(4)(e) to (o), as well as to any other matter that the court considers relevant. I turn first to the factors referred to in s. 91(4)(e) to (o). [Citations omitted.]
39 By reference to McKenzie v Topp Counsel for the defendants submitted that the onus of proof lies with the plaintiffs.[5] Counsel for the defendant relied on authority[6] to the effect that alcoholism was not a disentitling factor for an applicant under Part IV and by extension that the alcoholism of a family member like the deceased should not exclude them from the family unit. It was also submitted that the deceased's alcoholism could be distinguished from cases where an alcoholic is also abusive towards family members. Counsel for the defendants further submitted that ss 91(4)(o), which requires the Court to consider the character and conduct of the applicants, was the paramount sub-section of 91(4) to be considered.
40 Having dealt with the Relationships Act the remainder of Counsel for Kathleen's submissions focussed on the size of the Estate and in doing so referred to decisions where the division of an estate in equal shares between children of a deceased was denied[7] and where a testatrix who left her estate to one sister absolutely need not have left 'modest' legacies to each of her other siblings.[8] Counsel for Kathleen submitted that the deceased could not have made provision for all the moral claimants on her Estate and made provision for Kathleen as recognition that Kathleen's claim, at the end of her life, is more urgent than the claims of the plaintiffs. In relation to division of the Estate, Kathleen's Counsel submitted that equal third division would be an attempt to even up competing claims.
41 In support of their application Counsel for the plaintiffs referred to MacEwan Shaw v Shaw[9] where her Honour Dodds-Streeton J (as she was then) set out the two-stage test and relevant considerations as follows:
[24] A substantial body of precedent decided under the previous legislation indicated that the correct approach in the context of maintenance applications was to apply a two stage test. The first stage of the applicable test involved a determination of whether the deceased's will (or intestacy) was such as to provide adequate provision for the proper maintenance and support of the applicant.
[25] In resolving that question, the Court was required to place itself in the testator's shoes and determine what testamentary dispositions ought to have been made by a just and wise testator in all the circumstances of the particular case.
...
[27] In several cases, the concepts of moral duty or moral claim and the wise and just testator have been criticised, as constituting a judicial gloss without statutory justification. That criticism culminated in Singer v Berghouse [No. 2] where Mason CJ, Deane and McHugh JJ doubted whether the just and wise testator provided useful assistance in elucidating the statutory provisions.
[28] Despite those observations of the High Court in Singer v Berghouse (No. 2), and their subsequent endorsement by the New South Wales Court of Appeal, Victorian authority has adhered to the tests of moral duty and the wise and just testator. In Collicoat v McMillan Ormiston J declined to endorse the criticism of the Mason CJ, Deane and McHugh JJ observing that it was obiter dicta only. His Honour there observed that much of the criticism of the moral obligation misconceived its nature. In Ormiston J's view, the test did not require an applicant to demonstrate entitlement by reference to the merits of his character or conduct. Rather, it focused on the obligation of the testator to make such testamentary dispositions as were right and proper, according to accepted community standards, having made a wise and just assessment of the entitlements.
[29] Ormiston J in Collicoat v McMillan also observed:
"the expression 'moral duty' remains a simple and convenient way of referring to the obligation ... resting on a testator to make a wise and just assessment of the interests of all persons who might fairly ask to be taken into account in determining what adequate provision for proper maintenance and support should have been made for them had the testator been fully aware of all the relevant circumstances ... It is sufficient to say that the word 'moral' used in connexion with the legislation is apt to describe what is generally considered according to accepted community standards to do what is right and proper for those members of his family whom one would expect to be entitled to a share in the distribution of his or her estate on death."
43 In relation to the position of the plaintiffs as adult children of the deceased Counsel for the plaintiffs also referred to Brandon v Hanley where McMillan J said:[12]
Adult children
Although it was long the position that for adult children, and in particular adult sons, 'some special need or some special claim must, generally speaking, be shown to justify intervention by the Court under the Act', this is no longer the case. Instead, the Court must, as with all applications under the Act, consider the responsibility of the deceased to the applicant, having regard to the factors set out in ss 91(4)(e)-(p). In Walsh v Walsh, Hallen J helpfully summarised a number of general principles in relation to claims made by adult children:
(a) The relationship between parent and child changes when the child leaves home. However, a child does not cease to be a natural recipient of parental ties, affection or support, as the bonds of childhood are relaxed.
(b) It is impossible to describe in terms of universal application, the moral obligation, or community expectation, of a parent in respect of an adult child. It can be said that, ordinarily, the community expects parents to raise, and educate, their children to the very best of their ability while they remain children; probably to assist them with a tertiary education, where that is feasible; where funds allow, to provide them with a start in life, such as a deposit on a home, although it might well take a different form. The community does not expect a parent, in ordinary circumstances, to provide an unencumbered house, or to set his, or her, children up in a position where they can acquire a house unencumbered, although in a particular case, where assets permit and the relationship between the parties is such as to justify it, there might be such an obligation.
(c) Generally, also, the community does not expect a parent to look after his, or her, child for the rest of the child's life and into retirement, especially when there is someone else, such as a spouse, who has a primary obligation to do so. Plainly, if an adult child remains a dependent of a parent, the community usually expects the parent to make provision to fulfil that ongoing dependency after death. But where a child, even an adult child, falls on hard times, and where there are assets available, then the community may expect a parent to provide a buffer against contingencies; and where a child has been unable to accumulate superannuation or make other provision for their retirement, something to assist in retirement where otherwise, they would be left destitute.
(d) If the applicant has an obligation to support others, such as a parent's obligation to support a dependent child, that will be a relevant factor in determining what is an appropriate provision for the maintenance of the applicant. But the Act does not permit orders to be made to provide for the support of third persons that the applicant, however reasonably, wishes to support, where there is no obligation of the deceased to support such persons.
...
(f) The adult child's lack of reserves to meet demands, particularly of ill health, which become more likely with advancing years, is a relevant consideration. Likewise, the need for financial security and a fund to protect against the ordinary vicissitudes of life, is relevant. In addition, if the applicant is unable to earn, or has a limited means of earning, an income, this could give rise to an increased call on the estate of the deceased.
...
44 Counsel for the plaintiffs, in relation to the twins, submitted that there was no obligation on the deceased to support them as they were not beneficiaries under the Will nor applicants. Further, the deceased demonstrated no ongoing need to support the twins and they only moved into Tilbury Court a month before her death. Counsel further submitted that Kathleen had already benefitted from the gifts from the deceased to Kathleen shortly before her death and the insurance policy proceeds.
45 In relation to the estrangement of the deceased from the plaintiffs, Counsel for the plaintiffs again referred to Brandon v Hanley as well as Greely & Ors v Greely[13] in which Judd J found in relation to estrangement that:
The reasons for the breakdown in the relationship between the deceased and most of her children is no doubt more complex than the evidence reveals. It is not possible to identify a single cause or attribute blame. I do not accept that the breakdown was the result of misconduct by any one of the plaintiffs. I do not regard the circumstances of the breakdown to be such as to relieve the deceased of her moral obligation to make adequate provision for the proper maintenance and support of her children.
46 Counsel for the plaintiffs also referred to the New South Wales Supreme Court decision of McDougall v Rogers:[14]
If the plaintiff had any real control over her conduct and her engagement in argument and conflict, this behaviour would have extinguished the testator's duty to make provision for her. But she cannot stop herself. The plaintiff's propensity for involvement in conflict and litigation has elements of a disability, an incapacity for successfully grappling with life, and the plaintiff's claim is in the special class of claims by adult sons and daughters who are in some way disabled and in need of favourable parental treatment.
In family relationships, hurts are inflicted or suffered sometimes consciously, sometimes unconsciously. Sometimes a young child is brainwashed by a custodial parent to consider that the other parent has inflicted some harm which is all in the mind of the custodial parent. It is often impossible to work out whether the degree of separation between parent and child at the date of the parent's death is solely the fault of either or whether it has come about by factors too strong for either to control or somewhere in between. The important matter is not fault, but, whether in all the circumstances it would be expected by the community that the testator would have to make a greater benefaction than he in fact did to constitute proper or adequate provision for the plaintiff. [Citations omitted.]
47 In relation to the size of the Estate Counsel for the plaintiffs referred to authority that '[t]he Court should give weight to the paramount claims' even where the estate is small.[15]
48 Counsel for the plaintiffs submitted that the authorities referred to demonstrated that estrangement is not necessarily disentitling conduct as courts are reluctant to get involved in family disputes and the attribution of blame.
49 Counsel for the plaintiffs submitted that the Will of the deceased indicated that the deceased was not a wise and just testator as she made reference to the plaintiffs not wishing to have contact with the deceased which was not borne out by the evidence of the plaintiffs. Counsel for the plaintiffs submitted that a wise and just testator would have made provision for her children especially in circumstances where she knew them to be in financial need.
50 Finally, counsel for the plaintiffs submitted that there was no conduct on the part of either of the plaintiffs which would relieve the deceased of her moral obligation to make provision for them in her Will. Community expectation, Counsel for the plaintiffs claimed, would be that the deceased should have made provision for the plaintiffs who are in financial hardship and that the deceased had recognised this obligation prior to her estrangement from the plaintiffs.
Kathleen's application to be joined as a plaintiff
51 By summons dated 26 June 2014 and filed on 10 July 2014 Kathleen made an application under Part IV of the Act seeking leave to be joined as a plaintiff to the proceeding and that the time for making an application to commence her own proceeding be extended. On 24 July 2014 Associate Justice Zammit ordered that Kathleen's application be adjourned to the trial judge.
52 The relevant considerations were set out by Kaye J in Stanley v State Trustees Ltd:[16]
[6] Although the discretion, reposed in the court under s 99, is expressed in general terms, nevertheless that discretion must be exercised judicially and upon proper considerations. The plaintiff comes to this Court seeking an indulgence, and therefore the onus is on the plaintiff to persuade the Court that there is an appropriate basis upon which the discretion, to extend time, should be exercised in his favour. Ordinarily, the matters, which the court takes into account, on an application such as this, include the length of the delay, the reasons for the delay, prejudice to the estate or to any other party, and whether the plaintiff has a prima facie claim, which, at the least, is not hopeless. [Citations omitted.]
53 Counsel for Kathleen submitted that Kathleen's explanation for the delay was that she had been 'unaware that I could make a claim pursuant to Part IV of the ... Act until I consulted new solicitors' at which time she notified the defendant's solicitor of her intention to make an application at the commencement of the trial.[17] Kathleen's Counsel further submitted that her application was only attended by potential, not actual conflict, which could be isolated and managed. Kathleen's application that Tilbury Court be transferred to her absolutely notwithstanding her quasi life interest was based on Kathleen's need (with reliance placed on Kathleen's role as the primary carer for the twins) being greater than the plaintiffs.
54 Counsel for the plaintiffs submitted that Kathleen's application was well out of time as probate was granted on 23 November 2012 and Kathleen's application should have been made by 23 May 2013. Further, Kathleen's explanation for the delay was insufficient as she had been a party to the proceeding since commencement and in November 2013 had advised the Court she was considering making her own application, a date from which she also knew when the trial was set down for. Counsel for the plaintiffs submitted that, if granted, Kathleen's application gave rise to significant prejudice given Kathleen's position as one of three executrixes who share a close relationship.
55 Counsel for the defendants submitted that if granted they would not oppose Kathleen's application but would seek advice from the Court about how to proceed.
56 In light of the defendants' lack of opposition to Kathleen's application Counsel for the plaintiff submitted that there was a need for a proper contradictor. Counsel for the plaintiffs pointed out that the deceased's grandson, a minor, has an interest in the Estate which would require protection. Counsel for the plaintiffs also claimed that to not oppose Kathleen's application breached the duty of the defendants to uphold the Will. Counsel for the plaintiffs submitted that Kathleen's prime facie claim was weak due to the lack of moral obligation the deceased owed to Kathleen and as Kathleen had already been adequately provided for in the deceased's Will.
57 Kathleen has failed to discharge the onus placed on her to show that there was an appropriate basis to extend time. As an active party to these proceedings Kathleen's reasons for her lengthy delay in making her application lacked merit and were not adequate, reasonable or acceptable in the circumstances.
58 Although Kathleen took measures to minimise any potential conflict of interest once she had determined to make her own application, there would be potential for real prejudice were her application to be granted. Such prejudice would place the other executrixes in a compromised situation, given their relationship with Kathleen, and could also jeopardise the interests of the deceased's grandson who had not been separately represented throughout the proceeding.
59 Further, Kathleen's prime facie case was weak. It relied on unsubstantiated evidence in relation to a constructive trust being granted or declared in favour of Kathleen which would entitle her to an absolute interest in the main asset of the deceased's Estate. Further, on the authorities the deceased had no moral obligation to provide any support for Kathleen.
Kathleen's relationship with the deceased and reliance on the Relationships Act
60 Having dismissed Kathleen's application I need not consider her relationship with the deceased in the context of the considerations set out in ss 91(4). I note, however, that Kathleen is the sister of the deceased. There is little authority to support the proposition that the deceased had a responsibility to make provision for her siblings. The benchmark for a testator to make provision for a sibling is set high and seems to require a relationship which could be characterised as a loving parent and child relationship.[18] The evidence does not support the existence of such a relationship between Kathleen and the deceased and the burden imposed upon Kathleen[19] to show that the deceased had a responsibility to make provision for her would not be discharged. Although Kathleen and the deceased may have resided together for a lengthy period in the deceased's house and for a shorter period provided support for the twins, in the house owned by the deceased, the evidence only goes so far as to characterise their relationship as a 'normal sibling relationship'.[20]
61 Finally, reliance on the Relationships Act does not assist Kathleen. This Act has no application at all to the relationship between Kathleen and her sister.
62 The deceased made no provision for the plaintiffs in her Will.
Summary of matters the Court must consider under ss 91(4)(e)-(l) & (n)
63 The plaintiffs are the adult children of the deceased. Although not devoid of intra-familial disputes the evidence shows that the plaintiffs and the deceased shared a close and loving relationship for the majority of the plaintiffs' lives. The deceased had no obligation or responsibility to Kathleen, Nicole, Dorothy or the twins.[21] The deceased did owe an obligation to the plaintiffs as her children who she knew to be in difficult financial circumstances.
64 In relation to benefits given by the deceased to the plaintiffs there was evidence that the deceased had gifted the plaintiffs $10,000 each sometime in the late 1990s. The deceased gifted these amounts to the plaintiffs after an elderly couple she was employed by bequeathed to the deceased an unknown amount. The gifts of $10,000 were some time ago. The gifts were not insubstantial but they cannot now be characterised as bearing on any provision made for the plaintiffs out of the Estate. Nicole gave unsubstantiated evidence that the deceased claimed to have also forgiven loans to the plaintiffs of $10,000 each. In the absence of any evidence of these alleged loans I would regard amounts the deceased may have paid (including payment of debts and living expenses) during the plaintiffs' early lives as gifts also.
Disentitling conduct of the plaintiffs: ss 91(4)(o)-(p)
65 The only real issue in this case is the suggested disentitling fact of estrangement. Clearly the deceased had a moral obligation to support her children and clearly Teena and Cynthia are in need of such support. The defendants did not argue to the contrary.
66 So far as the only disentitling factor is concerned, I am not satisfied and the evidence does not support a finding that the plaintiffs were responsible for the estrangement, either at all, or to such an extent that would preclude them from making a claim.
67 The evidence in relation to the falling out with Teena is inconclusive.
68 In relation to Cynthia, in my judgment she took a hard but very responsible position in the circumstances. Any criticism of such a position is in my view misconceived and inappropriate. I accept that the effect on the deceased was dramatic, traumatic and unfortunate. However, the evidence does not support an endeavour or position taken by the deceased to ameliorate or address the situation so as to cause Cynthia to reconsider her position. In such circumstances the failure to do so may provide the basis for disentitling conduct. However this is not the case.
69 No other disentitling conduct was suggested and each of Teena and Cynthia are entitled to support and maintenance from the Estate of the deceased. This was apparently also the intention of the deceased presumably until, despite the estrangement, less than a month before her unfortunate death.
70 The plaintiffs submit that Tilbury Court be sold and the net Estate be divided between Teena, Cynthia and Kathleen. The defendants oppose the plaintiffs application. Counsel for Kathleen submits that the deceased could not have met the competing moral claims on her Estate and that given her age Kathleen's claim is more urgent than that of the plaintiffs and that the sale of Tilbury Court will cause her and the twins some difficulty.
71 While the plaintiffs have succeeded in their application I am mindful of the body of authority regarding the freedom of testation. As Callaway JA (Tadgell and Charles JJA concurring) commented in the appeal from Grey v Harrison:[22]
It is one of the freedoms that shape our society, and an important human right, that a person should be free to dispose of his or her property as he or she thinks fit. Rights and freedoms must of course be exercised and enjoyed comfortably with the rights and freedoms of others, but there is no equity ... to interfere with a testator's dispositions unless he or she has abused that right.[23]
72 Grey v Harrison,[24] a decision of this Court, was cited by Counsel for the defendants for the proposition that alcoholism not be a disentitling factor for an applicant under Part IV. The case concerned an estate which had been bequeathed to the sister and granddaughter of the deceased, Mr Grey. At trial the son of the deceased, for whom the deceased had made no testamentary provision, succeeded on his application. The trial judge ordered that provision be made for the applicant out of the amounts left to the two beneficiaries, the deceased's sister and granddaughter (the applicant's daughter). The applicant's appeal concerned the appropriateness of the provision ordered, claiming it was insufficient. In allowing the appeal the Court of Appeal ordered that:
A wise and just testator might well have divided his residuary estate, after payment of his just debts and funeral and testamentary expenses, into three equal parts, giving one such part to his widowed sister, one to his neglected grand-daughter and the other to the appellant.[25]
73 The deceased may have, in the final part of her life, felt some obligation towards Kathleen. However, she had, for a longer period wished that her daughters be beneficiaries of her Estate and it was a breach of the moral duty the deceased owed to them not to make any such provision.
74 In my judgment, Teena and Cynthia should have been left one-third each of the net Estate (aside from the vehicle which has already been transferred to a non-party beneficiary). The practical consequence is that Kathleen should receive the remaining one-third.
75 I will hear from the parties as to the precise form of orders and costs.
[1] So far as may be relevant, the evidence in this regard and in many other respects is entirely unsatisfactory.
[2] McKenzie v Topp [2004] VSC 90 [15]; Coates v National Trustees Executors and Agency Co Ltd [1956] HCA 23; (1956) 95 CLR 494, 505-8 (Dixon CJ).
[3] Prosser v Twiss [1970] VicRp 29; [1970] VR 225, 233.
[5] McKenzie v Topp [2004] VSC 90 [39].
[6] Grey v Harrison (Unreported, Supreme Court of Victoria, Harper J, 5 September 1995).
[7] Markovska v Kocevska [2005] VSC 319; Chapman v Hudson (2006) NSWSC 373.
[8] Petersen v Micevski (2007) VSC 280.
[9] [2003] VSC 318 [24]-[29]. (Citations omitted.)
[10] Greely & Ors v Greely [2011] VSC 416 [28]; Brandon v Hanley [2014] VSC 103 [20].
[11] IMO the will and estate of Angelo Marotta (deceased) [2011] VSC 324.
[12] [2014] VSC 103 [20]. (Citations omitted.)
[13] [2011] VSC 416 [63].
[15] Christidou v Chris [2012] VSC 626 [59].
[17] Counsel referred to Momo v Vincente (2012) VCC 417.
[18] Marshall v Spillane [2001] VSC 371 [15].
[20] Sanderson v Bradley [2004] VSC 231 [34].
[21] The executrixes have all benefitted from the proceeds of the life insurance policy in accordance with the deceased's desire that they so benefit - albeit misguided - as expressed in her will.
[22] Grey v Harrison [1997] 2 VR 359.
[24] Grey v Harrison (Unreported, Supreme Court of Victoria, Harper J, 5 September 1995).
[25] Grey v Harrison [1997] 2 VR 359, 367.
Hartnett & Hartnett
Taylor & Ors [2014] VSC 427
(1956) 95 CLR 494