Foley v Foley Foley v Foley [2008] NSWSC 233 | Case summary

1 HIS HONOUR: This is an application under the Family Provision Act in respect of the late Maurice Lindsay Foley who died on 8 September 2004 aged 86 years. He was survived by his second and third wives who are the plaintiffs in the two proceedings which I have heard together, with the evidence in one being evidence in the other. 2 Another plaintiff, Julie Widman, is a step-daughter of the deceased but she no longer presses her claim. 3 The deceased was first married to Margaret Foley, with whom he had three daughters. There was no contact between the deceased and these after the second marriage. I have heard evidence of attempts to locate them and I am satisfied that it is impractical to give them notice under section 20 of the Act. The last will of the deceased 4 This was made on 5 April 2004. By it he gave his third wife, Carmen, a legacy of $600,000 and gave the residue to his son, the defendant. The defendant is the son of his second marriage. Estate of the deceased 5 The estate consists now of: (a) his former matrimonial home in Warriewood valued at about $750,000. (b) cash held in the estate of $320,000. 6 There has been a transfer to that defendant of cash and shares worth $56,000. There has been transferred to the defendant a joint bank account of $19,040 and the car worth, at the date of death, $8,000. 7 Costs have been incurred in the matter. The plaintiff Carmen's costs amount to $35,000; the plaintiff Betty's costs amount to 33,003; $27, and the defendants $32,000. Family History 8 The deceased was born on April 1918 and his second wife Betty was born in July 1925. His third wife, Carmen, was born in May 1945. Betty herself had been married before to John Reddan in 1949 and she had two children, Peter born in July 1956 and Julie born in January 1958. She separated from her husband in 1959. In 1960 she commenced a de facto relationship with the deceased. 9 Very soon after Lyndon, the defendant, was born in November 1964 and Betty and the deceased married in May 1968. They separated at some time in 1974 or 1975 and a decree nisi was granted in January 1950. As a result of that the deceased kept the matrimonial home at 27 Kingsway Street, Dee Why. Betty had before the divorce purchased a unit at 5/7 Kempsey Close, Dee Why which was fully mortgaged. 10 In 1980 the deceased met his third wife, Carmen, overseas in the Philippines and he married her in June 1980. In 1981 the deceased sold the matrimonial home at Kingsway Street, Dee Why for $86,000. He purchased another place which was used as their home at 32 Fisher Road, Dee Why for $105,500. The plaintiff did not contribute to the capital costs of this purchase. They thereafter resided in that as their home for 18 years until 1999. 11 It was in the mid-1980s the deceased ceased his work as a builder and started to become frail in the 1990s. In 1992 his second wife, Betty, and her son Lyndon purchased a property at North Narrabeen. 12 In a will made on 4 April 1996 the deceased provided for his then wife, Carmen, by providing that his trustee could spent $200,000 plus some CPI increased from the date of the will to purchase a property to hold for her for her life, and left the residue to his son Lyndon. In 1997 he updated this to $300,000 plus the CPI. 13 In 1999 the deceased sold their then matrimonial home at Fisher Road, Dee Why for $900,000. He purchased a new home for them at Oaks Avenue, Dee Why for $255,000 and a unit at Dee Why Parade, Dee Why for $255,000. 14 The following year he sold the Dee Why Parade property for $269,000 and purchased what was to become the final matrimonial home at Streamdale Grove, Warriewood for $484,000 using the proceeds of the sale from the De Why Parade property and cash left over from the sale of the matrimonial home at 32 Fisher Rd, De Why. Once again there were no contribution to the capital cost by the plaintiff Carmen. 15 In 2000 Betty and Lyndon sold their home and moved to a new home that Lyndon purchased at Warriewood. 16 In 2002 Carmen ceased the work which she had been carrying out as a dressmaker to care for the deceased as he became somewhat more frail. By 2003 she suggested she was a full-time carer. In March of 2004 the will was changed to increase the capital cost of the unit to be purchased to $400,000 17 I have already mentioned that in April 2004 the final will was made. It was an absolute gift of $600,000 to the plaintiff Carmen with the residue to Lyndon. The deceased died on 8 September 2004 and the 18 month period within which any claims under the Act had to be made expired on 8 March 2006. Probate was obtained on 19 November 2004. 18 The summons was filed by Carmen on 25 July 2006, four months out of time. The summons was filed by Betty Foley and Julie Widman on 26 September 2007, which was some 17 months out of time. Extension of time 19 Because the application is out of time it is necessary for the Court to consider section 16 of the Family Provision Act which allows an application to be made notwithstanding it is out of time. There are a number of cases which refer to the principles to be applied in an application for an extension of time. In Re Guskett (deceased) (1947) VLR 211 the following was said: "It is necessary for the applicant to make out a case there will justify the grant of the intelligence sort. He is to show reasons why his failure to apply within the time allowed should be excused. Every case will have to be dealt with on its own facts but it would seem necessary for the applicant to satisfy the Court that the circumstances are such as to make it unjust for him to be penalised for being out of time. As moreover he is seeking an indulgence he should apply promptly for an extension of time."

30 There is no verification in respect of the plaintiff's account of the deceased's conversation. The conversation which occurred after the will was made is unlikely to have happened as the plaintiff was present when the last will was signed, she knew of its contents and made no comments about it. According to the defendant she said she was happy about it. 31 The plaintiff Carmen's evidence was unsatisfactory in a number of aspects. In cross-examination she demonstrated she had exaggerated her income and contributions. She did not disclose the friendship with Mr Johnston, which only came out in cross-examination. It was relevant as the case that she was putting was that she wanted to remain in the matrimonial home. But it became apparent she would consider moving up to the Central Coast if the relationship advanced. She said in her evidence that she did completely cease work in 2002 but after the date of death still continued with her dress making. 32 I would prefer the defendant's account as in the circumstances it seems more likely. In cross examination the plaintiff Carmen said she did not know that there was a time limit within which an application had to be brought. 33 There is no suggestion that she saw a solicitor earlier than when she says in her affidavit. In those circumstances it seems there is at least an explanation as to the delay and I should extend time. 34 In respect of the plaintiff Betty Foley, her claim was 17 months out of time. She was living with her son, the defendant, at the date of death and continues to do so. Her explanation for the delay is as follows: "40. I am aware that Carmen, my former husband's third wife, has made a claim against the estate. Carmen was left a sum of $600,000 in Maurie's will which I had assumed would be sufficient for her to provide self-contained accommodation in a retirement village or similar for herself. 41. My expectation was that once my son Lyndon had received the benefit from his father's estate that he would assist me to move out of his home and that he would assist me to find the accommodation that I now seek by way of family provision claim. 42. My reason for not commencing these proceedings earlier was the expectation that I had that my son would provide for me from the benefit that he received from Maurie's will." 35 She was not cross-examined upon this aspect by either party. She does not spell out why there was a change by her son but I only infer she had some change of heart once Carmen brought the proceedings. 36 There are a number of cases where a change of heart has not been held to be a sufficient reason. In Re Lauer (1984) VR 180 it was held that the mere fact that the applicant's financial position had deteriorated cannot of itself be a ground for granting an extension of time under the Act, nor could the mere fact that the value of the estate had been inflated beyond what might have been expected at the date of the testator's death be such a ground. 37 Re Lauer was followed by Young J in Bearns v Bearns-Hayes (unreported) 6 May 1997). In that case for a period of two years until late 1994 the plaintiff had no intention of making a claim as she had assurances from her family that her position with her home was secure and that she had sufficient income. In late 1994 arguments broke out in the family as a result of which the plaintiff felt abandoned by her family and that she could not rely on the loose arrangements previously in place. His Honour found that this was not a sufficient reason. 38 Relevant considerations in the present case include: (a) there is no suggestion by her that she did not know of the time limit. (b) she only changed her mind after Carmen made a claim out of time. (c) she was quite happy to rely on the provision from her son. This was not un-natural given she had earlier helped him set up in life. 39 In the circumstances it seems to me that this is not a sufficient explanation and I would not extend time. I will, however, in case someone else takes a different view, consider her claim. Factors Warranting 40 The plaintiff Betty Foley would have to establish factors warranting in accordance with section of 9 of the Act. The question of factors warranting in respect of former spouses has been dealt with in a number of cases. In Dijkhuijs (formerly Coney) v Barclay (1988) NSWLR 639, a number of the Judges dealt with this matter. Kirby P had the following to say: "Fifthly, the respondent picking up one of the themes of Mr Landa's comments, urged that section 9 (1) of the Act was to be read in the light of the policy of the law to promote the finality of settlements of property disputes by orders made in the Family Court. Where such orders had been made, an order under the Act in the case of a former spouse should be exceptional. Only if this approach were adopted would the policy of the Family Law Act (Cth) be fully achieved. That policy is that parties whose marriage has been dissolved and in respect of whom orders have been made disposing of their matrimonial property, could go their separate ways. Save for the rare and exceptional cases provided under the Family Law Act (Cth), such parties should henceforth face no financial obligation from one to the other. This public policy was referred to by Young J in O'Shaughnessy (at p149). It was also stressed by his Honour in the present case. There is no doubt that in most cases, the achievement of a final property settlement in the Family Court would be seen by the parties, in current social circumstances, as terminating any moral claim of a former spouse to provision in the will of the other. Confronted by the news that he or she had been excluded from the will of the former spouse, the response would, in the overwhelming majority of cases, be ' Our marriage was dissolved. We settled our financial affairs. We can each start a new life. That was the whole point of the Family Court proceedings.' To this extent, I agree with what the Young J has written in O'Shaughnessy and in this case." 41 Mahoney JA said the following: "That which the Court 'shall determine' is whether ' there are factors which warrant the making of the application'. That phrase may be contrast that with the reference is otherwise made to the determination of, for example, ' what provision (if any) ought to be made in favour of an eligible person…' On the face of section 9 (1) there is a distinction between ' factors which warrant the making of the application' and factors which warrant the making of an order. That distinction accords with the principle which, in my opinion, is inherent the legislation, viz, that, special cases apart, an order is to be made only if the deceased has made default in the performance of the duty which he owed to the particular plaintiff. I do not think that this case requires a final analysis of the basis of applications under the Act: It will be sufficient to refer to this matter in general terms. But the Act authorises the Court to ' order that such provision be made out of the estate or notional estate, or both, of the deceased person and is, in the opinion of the Court, ought, having regard to the circumstances at the time the order is made, to be made for the maintenance, education or advancement in life of the eligible person' (s7). That does not mean that, if the plaintiff establishes a financial need within the section and if on taking into account the considerations referred to in section 9 (2) (a discretionary considerations) there being nothing to the contrary, an order must be made. The statute assumes that the deceased, in what he has done during his life and by his will, has failed to discharge a duty which he owed to the plaintiff (the moral duty). Thus, a plaintiff may be a former spouse who, on dissolution of the marriage, received what on any view she was entitled to have and there may have been no further relationship between them so that none of the factors in section 9 (3)(a) to section 9 (3) (c), are of relevance. But, at the deceased's death, she may have a financial need. In such circumstances, the fact that the plaintiff has established that she was a former spouse and has a financial need would not, as such, entitle her to an order. It is unnecessary for her to establish that, in some way or because of circumstances within section 9 (3) (d), the deceased had a duty to her which involved that he should have provided for her financial need. This will be so a fortiori where the basis for the eligibility of the plaintiff is alleged to be within par (d) of the definition of ' eligible person'". 42 Importantly, it can be seen that the question of need is a separate matter and factors warranting something different from that. 43 In another case, Churton v Christian (1998) 13 NSWLR 241, his Honour Priestley JA said, in respect of this type of application: "Mrs Christian is a member of a class in respect of whom warranting factors may often be more difficult to find. It is common experience that divorce sometimes brings to an end all links between previously married people. In such cases, warranting factors might well be expected usually to be absent, although this need not be universally so. On the other hand, divorced persons may remain on close terms, sometimes little different from those on which they lived when marriage. In every case it is necessary to examine the actual relationship between the two people concerned, as far as possible without preconceptions based only on the fact of divorce." 44 In his comments he illustrated a situation which sometimes applies after there has been a divorce and a property settlement, namely, that the parties still continue to have a close association. 45 There has also been further attention to this matter in the Court of Appeal in the case of Brown v Faggoter, a decision given on 13 November 1998, which is a decision of Sheller JA, Sheppard and Fitzgerald AJA. The main judgement was given by Fitzgerald AJA, who seemed to suggest that an application might be warranted if the application has reasonable prospects of success. There seems to be a somewhat different and perhaps easier test than what was referred to in the other cases of the Court of Appeal to which I have referred. I will consider the matter on both bases, given that there may be some flux in the state of the law in this regard. 46 In the present case the plaintiff Betty Foley did not have a property settlement with the deceased at the time of the divorce. Although she had a unit, it was fully mortgaged. She ended up looking after the son of the marriage and the deceased kept the matrimonial home which, through capital gains, has directly led to the present estate. All she received in the divorce was an order that the deceased pay $10 per week maintenance for her son. 47 There was no further close association with the deceased after his marriage to Carmen. However, given the length of the second marriage and their relationship, plainly she could have received some part of the matrimonial home if she was to have a made an application. She was just glad to be out of the marriage and did not make such application. In my view there are in this case factors warranting. Eligibility 48 Both the plaintiffs would be eligible persons. In applications under the Family Provision Act the High Court in Singer v Berghouse (1994) 181 CLR 201 has set out the two stage approach that a Court must take. At page 209 it said the following:- "The first question is, was the provision (if any) made for the applicant inadequate for (his or her) proper maintenance, education and advancement in life? The difference between 'adequate' and 'proper' and the interrelationship which exists between 'adequate provision' and 'proper maintenance' etc were explained in Bosch v Perpetual Trustee Co Limited . The determination of the first stage in the two-stage process calls for an assessment of whether the provision (if any) made was inadequate or what, in all the circumstances, was the proper level of maintenance etc appropriate for the applicant having regard, amongst other things, to the applicant's financial position, the size and nature of the deceased's estate, the totality of the relationship between the applicant and the deceased, and the relationship between the deceased and other persons who have legitimate claims upon his or her bounty. The determination of the second stage, should it arise, involves similar considerations. Indeed, in the first stage of the process, the court may need to arrive at an assessment of what is the proper level of maintenance and what is adequate provision, in which event, if it becomes necessary to embark upon the second stage of the process, that assessment will largely determine the order which should be made in favour of the applicant. In saying that, we are mindful that from arrangements to pay creditors". 49 I turn to consider the situation of the plaintiff, Betty Foley. Betty is single, aged 82, with no dependents. She has no accommodation of her own and lives with her son, his wife Angela, and their two children and has done so for the past seven years. She says she has cash assets of approximately $253,000, being money in an interest bearing cheque account of $118,000, which provides income of about $300 per month, and a cash management account of $135,000 with the St George Bank earning interest at 4.35% per annum giving her a further income of about $490 per month. She receives a part age pension of $350 per fortnight; has 1,355 shares in the NRMA and received a dividend of approximately $186 each six months; and owns a 1995 Ford Festiva motor vehicle which is insured for $3,000. From that income she meets her own food and other expenses. 50 She plainly contributed to the deceased estate when she was with him by her family contributions in looking after their child, and also her other contributions when she worked as a bookkeeper. 51 I turn to the situation of the plaintiff Carmen. Carmen is single, aged 62 with no dependents. She presently lives in the deceased home and owns no real estate. She has $20,000 in the bank and has a $20,000 car bought with a loan from a new friend, Mr Johnston. She receives the age pension of $250 per week, which is consumed by her expenses, which are about $291 per week. She suffers from depression and anxiety. 52 During the marriage she did dressmaking. The cross examination demonstrated there were only occasional times that her income exceeded her rent of $100 a week that she had to pay for the premises where she did dressmaking. She also had the expense of materials. What little she did receive over and above her rent I accept she contributed to the household. But it is plain she had no basis of any capital to contribute to the purchase of the deceased's properties. 53 For the last two years she gave up dressmaking work to care for the deceased at the time. Obviously the deceased was frail at the time and this was a helpful contribution, and she did have the assistance of receiving meals on wheels. 54 It is necessary to consider the situation in life of anyone else having a claim on the bounty of the deceased. In this case it is the defendant, the deceased's son. Lyndon Stuart Foley who is 43 years of age and had a good relationship with the deceased, who moved to Warriewood to be close to his son. He does not put before the Court any information as to his personal circumstances or his financial situation. The Court can therefore infer that it can proceed on the basis that these matters are not to be taken into account by the Court in considering the application that comes before it.' Discussion 55 It is necessary to consider how the two plaintiffs say they have both been left without adequate and proper provision for their maintenance, education and advancement in life. 56 The plaintiff Betty Foley wishes to have a house of her own wishes to buy a two-bedroom unit in the Mona Vale area at a cost of between $445,000 and $480,000. The evidence before me demonstrates that there are appropriate units available for that price. 57 The plaintiff Carmen wishes to receive the matrimonial home, worth $750,000, plus a fund for contingencies of between $50,000 and $80,000 in lieu of the $600,000 provided for her in the deceased's will. 58 As far as Betty Foley is concerned, I would have thought, having regard to her present assets, a legacy of $250,000 would have been appropriate if I had extend time. 59 The claim of Carmen Foley is quite problematic. The provisions normally made in respect of widows have been set out in many cases, and recently the President of the Court of Appeal in Golosky & Anor v Golosky, unreported 5 October 1993, summarised them in the following terms: " In testing the Master's decision it is appropriate to keep in mind the principles which govern the approach which he was obliged to take to the widow's application under the Act. Relevantly, these included: (a) Proper respect must be paid for the rights of testamentary disposition which is the fundamental premise upon which the provisions of the Act are based. That premise required the Court out of respect for the continuing right of testamentary disposition, to limit its disturbance of the testator's will to that which is necessary to achieve the purposes of the Act, and not more. See The Pontifical Society for the Propogation of the Faith and St Charles Seminary, Perth v Scales (1962) 107 CLR 9, 19; White v Barron and Anor, above, 458; Hunter, above, 576; (b) The jurisdiction is not the correction and hurt feelings sense of role of the competing claimants upon the estate of the testator. The Court is diligently to respond to the application the person who was a member of the testator's household and to consider whether, as claimed, the provision made by the will is inadequate for that person is proper maintenance and advancement in life. See Heyward v Fisher, Court of Appeal, unreported, 26 April 1985; (1985) NSWJB 81. (c) Consideration of other cases must be conducted with circumspection because of the inescapable detail of the factual circumstances of each case. It is the detail that the answer to the proper application of the Act is to be discovered. No hard and fast rules can be adopted. Nevertheless, it had been said that in the absence of special circumstances, it will normally be the duty of a testator to ensure that a spouse (or spouse equivalent) is provided with a place to live and appropriate to that which he or she has become accustomed to. To the extent that the assets available to the deceased will permit such a course, it is normally appropriate that the spouse (or spouse equivalent) should be provided, as well, with a fund to meet unforeseen contingencies; see Luciano (above) 69-70; (d) A mere right of residence will usually be an unsatisfactory method of providing tourist bosses accommodation to fulfil the foregoing normal pre-supposition. This is because a spouse may be compelled by sickness, the huge, urgent supervening necessity or otherwise, with good reason, to leave the residence. The spouse provided and will then be left with out the kind of protection which is normally expected will be provided by a testator who is both wines and just. See Moore v Moore , Court of Appeal, unreported, 16 May 1984, per Hutley JA; (e) considering what is some "proper" and by inference what is "improper" is a provision in a will, it is appropriate to take into account all of the circumstances of the case including such matters as the nature and quality of the relationship between the testator and the claimant; the character and conduct of the claimant; the present and reasonably anticipated future needs of the claimant; the size and nature of the state and of any relevant dispositions which may have reduced the estate available for distribution according to the will; the nature and relative strengths of the competing claims of testamentary recognition; and any contributions of the claimant to the property or to the welfare of the deceased. See Re Fulop Deceased (1987) NSWLR 679 (SC); Churton v Christian and Ors (1988) 13 NSWLR 241 (CA), 252." 60 In talking of the need to provide a house and a sum for contingencies, the President is clearly referring to Wellman and passages in Luciano v Rosenblum and other cases. As was pointed out by the Court of Appeal in Elliott v Elliott, unreported, 29 April 1986, such a type of provision only applies where it can be said there has been a long and happy marriage and a widow has helped build up the estate of the deceased. The Court also accepted that she should have sufficient income to enable her to live in a reasonable degree of comfort and free from any financial worry. 61 The plaintiff's submissions emphasise the fact that the estate could accommodate a claim, particularly bearing in mind that the defendant put no circumstances of his own before the Court. Why should she not be treated generously in those circumstances? 62 The answer lies in the fact that the first task of the Court is to see whether she has been left without adequate and proper provision for her maintenance, education and advancement in life. She received $600,000 under the will and the evidence demonstrates she would be able to buy a suitable two-bedroom unit in the Dee Why area where she has friends for $400,000. This would leave her with $200,000 for contingencies and an income supplement. 63 She advances no good reason why she needs the matrimonial home. It is a four bedroom and one study home which has two stories and has a two car garages. She has friends in the area. She has no family and does not have any special attachment to the house. She is even considering the possibility of a move to the central coast to be near Mr Johnston. 64 The house was a matrimonial home for a short number of years before the deceased death. 65 Although in this case there was a 24 years marriage, there was no contribution to the real estate. Often this needs to be put to one side when a partner has looked after the parties children and raised them and brought them up and has thus not been able to go out to work. 66 In this case this did not happen as they had no children, and looked after none of the deceased children. The plaintiff did not contribute to the deceased's business. 67 Interestingly, the deceased by his continual changes in the will up-dated the provisions for the plaintiff over the years. He was plainly mindful of what was necessary and what he thought was appropriate to provide for the deceased. 68 In the circumstances I am not satisfied that the plaintiff Carmen has been left without adequate and proper provision for her maintenance, education and advancement in life. Accordingly I dismiss both proceedings. I will hear submissions on costs.

Foley v Foley Foley v Foley

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