Fysh v Coote & Ors [2000] VSCA 150

[2000] VSCA 150

Court of Appeal (Vic)|2000-08-21|Before: ORMISTON, BATT and CHERNOV, JJ.A.

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Source facts

Court

Court of Appeal (Vic)

Decision date

2000-08-21

Before

ORMISTON, BATT and CHERNOV, JJ.A.

Source

Original judgment source is linked above.

Judgment (36 paragraphs)

[1]

[2000] VSCA 150

[2]

SUCCESSION - Executors - Removal on ground of "unfitness" - Conflict of interest and duty - Delay - Allegation that insufficient time given to prepare defence - Not asserted before primary judge - Clear case that welfare of beneficiaries required removal.

[3]

This appeal has been brought by the defendant, Helen Elizabeth Fysh, who was removed, pursuant to s.34 of the , as the "surviving executrix" of the will and estate of Jasper Lloyd Coote, deceased, by order of a judge of the Trial Division sitting in the Practice Court, upon an originating motion brought by Anthony John Coote, a fellow beneficiary in the estate with Mrs Fysh, and Douglas Gerald Burley and Annette Jennifer Richards, who each represent the estates of the appellant's other fellow beneficiaries in the estate. The learned judge also made orders appointing the Equity Trustees Ltd as administrator with the will annexed of the estate of the deceased in place of the appellant, and that the appellant deliver up to that company the duplicate Certificate of Title to a unit in Dunloe Avenue, Mont Albert North, which had been the home of the deceased until his death on 24th October 1995 and which has been occupied by the appellant from approximately August 1996. The appellant was also ordered to pay the costs of the proceedings. It should be noted that no point was taken on behalf of the respondents that leave to appeal was required before an appeal could be brought from an order under removing or appointing personal representatives, but in the circumstances it is not necessary to express an opinion whether such an order is interlocutory as, having regard to the conclusions the Court has reached as to the merits of the appellant's case, such an application would otherwise have failed.

[7]

In the circumstances the learned judge had before him essentially only the version of events put forward on behalf of the respondents. Although doubtless he gave the appellant as fair a hearing as could be expected where a party is unrepresented (and no direct complaint is made as to his Honour's conduct)[1], it is not surprising that in his relatively brief judgment he accepted the respondents' version of events. Thus he concluded that she had "raised obstacles in the path of the disposition of the property", which was the home unit and the sole asset of any real significance, and had "made totally unreasonable demands" on the respondents in relation to the administration of her father's estate. He pointed out that the other beneficiaries, or subsequently their representatives, had attempted to persuade her to sell the unit to enable the estate to be distributed, but that she had taken no such steps and had remained in the unit, not paying rent, up to the time of the application. He referred to the fact, then uncontroverted, that she had five different solicitors over the years which he said gave "an inkling of the defendant's behaviour", as did the "request for further and better particulars" annexed to her affidavit to which I have referred. He concluded that "the administration of the simplest of estates has not been completed more than three years after the grant of probate to the executors of the estate". Without further particularisation he concluded that it "can now properly be said that the [appellant] is unfit to act as executor of the estate or is incapable of doing so", referring in general terms to the judgment of Ashley, J. in Monty Financial Services Ltd. v. Delmo[2]. Having regard both to the circumstances of the present case and the wide range of issues canvassed by Ashley, J., I would assume that his Honour here based his opinion of unfitness on not only the delays in administering the estate but also on the appellant's incapacity to resolve the difficulties of administration having regard to her conflicts of interest with the estate and with her co-beneficiary Mrs Burley and latterly her estate.

[10]

At the beginning of the hearing of the appeal the appellant objected both that the respondents' summaries of proceedings, issues and facts had been served out of time (since the obligation rested on them where the appellant was unrepresented) and that the respondents' outline of submissions had not been served until after 1 p.m. on the day before the appeal, in breach of the requirements of the relevant practice statement. The summaries were in fact short and were served by 13 July, containing little that was contentious, although the appellant complained that the facts stated in two sub-paragraphs were not correct, a view which failed to take into account her failure to controvert those particular matters at the time of the hearing before the learned judge. She had good reason to complain, however, at the late delivery of the respondents' outline which in effect she received late in the afternoon preceding the hearing together with a substantial bundle of authorities. Not surprisingly she said that she had difficulty in understanding that material and required more time to consider what was going to be argued. As the outline contained only the respondents' argument in answer to her case and as all parties were anxious that the matter proceed as soon as possible, there being no free date for a further hearing for at least two months, the Court decided to adjourn further hearing until 2.15 in the afternoon so that the appellant could further consider the outline and seek some advice. The hearing did proceed at that time, although the appellant was not entirely happy, but at the end of the day, after the appellant had put a few oral submissions in reply, the Court determined that she should have until 4 p.m. the following Monday in order to put any further submissions in reply in written form. Those further submissions have, of course, been considered by the Court. I should add that at no time did the appellant state that she had been refused legal aid or wished the hearing to be adjourned so that she could obtain legal aid, so that, although the Court was well aware of her difficulties in dealing with what is in many ways a technical legal area, we had to assume at this stage of the proceedings she had chosen not to be legally represented. Although clearly handicapped by her lack of legal expertise, she seemed able to present a forceful and coherent statement in lay terms of what she perceived to be her case, albeit at times emotionally affected by her concern as to the outcome.

[25]

Having regard to those principles, I have concluded that the appellant is "unfit to act" in the office of executor, which is a primary basis under s.34(1)(c) of the Act for removing an executor and appointing some person as administrator in her place. Essentially her unfitness arises not so much from the delays in administering the estate, which are bad enough but for which her co-executor and the other beneficiaries or their representatives may share some responsibility, but because her conduct and attitude towards both her former co-executor and those beneficiaries and their representatives had placed her in a position of such conflict as between her own interests, the interests of the estate and the interests of those beneficiaries as to make it impracticable for her, especially with her limited knowledge of some of the difficult legal issues so raised, to administer the estate now so as to bring that administration fairly and with reasonable speed to its natural conclusion in a manner which would enable all parties' rights to be fairly recognised. At all times it has been by modern standards a very modest estate, the value of which seems never to have been much greater than $150,000, possibly a good deal less and only more on the most optimistic of the appellant's contentions as to the liabilities of others. The principal asset of the estate is the unit, in its original poor condition worth perhaps as little as $90,000 and, at other times, with the admitted repairs and improvements by the appellant, worth up to somewhere between $130,000 and $150,000. The precise value is now of little consequence, for the appellant in the course of her submissions clearly conceded that she will not have the money to buy the interests of what are in effect the other three groups of beneficiaries, a course she was originally and for some three years or so determined to pursue, which created constant difficulties because she placed a lower value on the property than did the other beneficiaries, howsoever willing they might otherwise have been to allow her to buy them out.

[26]

That has been but one conflict of interests of several existing between the appellant and the estate which regrettably she has seemed unwilling to perceive. Though she did carry out some repairs and improvements and though she may have thought that her value was the fair one, it was clearly in her interests to place a lower value on that property, whereas it would have been in the interests of the estate to obtain a higher price from whosoever would purchase it. Secondly, and more unfortunately, although on perhaps a few occasions those interested in the estate were close to reaching agreement as to a fair price for her to buy them out, she seemed always to place an impenetrable barrier to settlement in that she insisted that her sister, or latterly her sister's estate, account to the estate for what the appellant asserted and believed to be her various depredations on her father's moneys and property during his lifetime, so as to reduce the net entitlement of Mrs Burley (or her estate) as beneficiary of her father's estate. Of course, there is nothing wrong, indeed, there is a great deal to be commended, in an executor's trying to bring into the estate as many assets as practicable. There is still no reason why energetic attempts should not be made to get in assets of that kind if there is a proper basis for doing so. The difficulty in the present case is that, whatever suspicions the appellant may have thought existed, none of the accusations against her co-executor have yet been sheeted home and she is no further forward, or very little further forward, in making out those allegations than she was three or four years ago. A competent executor would have brought those matters to a head well before now, however intransigent the other parties might have been, or at the least would have taken proper legal steps so as to show the other beneficiaries of this relatively small estate that it remained worthwhile pursuing them. Not only has she not taken any significantly useful steps to that end, but all the other beneficiaries have insisted that she conclude the administration of the estate, which nevertheless she has failed to do. She seems never to have contemplated the possibility of that dispute remaining outstanding, if possible, while the rest of the estate was administered. In particular, although a few small bank accounts have been got in and distributed, the principal asset remains unconverted and therefore undistributed between the beneficiaries. She does not appear to have realised that her dispute with one beneficiary or group of beneficiaries could not justify depriving the other beneficiaries of their rightful inheritance (or at least part thereof), so convinced has she been of the righteousness of her campaign against Mrs Burley and her estate. Because she has otherwise been so concerned to obtain the right to purchase the unit, she has put her interests ahead of that of the whole estate by placing an irrelevant condition on its realisation.