Hardman v NSW Trustee & Guardian [2010] NSWSC 500 | Case summary

2010/38161 ELAINE HARDMAN v NSW TRUSTEE & GUARDIAN JUDGMENT 1 HIS HONOUR: In these proceedings the Plaintiff essentially seeks orders the effect of which would be to give her the benefit of the proceeds of sale of a house in Roseville ("the Property") which was originally owned by her father, which passed to her stepmother on his death and which has now passed to the Crown as bona vacantia. 2 William Charles Merrett, the Plaintiff's father, and Mary Isabel Merrett, the Plaintiff's mother, purchased the Property in 1920. The Plaintiff was born two years later. She was an only child. 3 In 1947, the Plaintiff married David Philip Hardman at which time she moved out of the family home. 4 The Plaintiff's mother died in 1952. Following her death her Estate passed to the Plaintiff's father in its entirety. 5 In 1954, the Plaintiff's father married Gladys May Tinker - who I have and will continue to refer to as the Plaintiff's stepmother. At the time of that marriage, the Plaintiff's father was 58 years old and her stepmother was 31 years old. The evidence suggests that the Plaintiff enjoyed good relations with her stepmother. 6 In 1967 the Plaintiff's father made his Will. He left the Property to his wife and, in the event that she predeceased him, to the Plaintiff. 7 The Plaintiff, who was not cross-examined, gave evidence that at about the time her father made his Will he said to her words to the effect of "I am going to will the estate to Gladys. She has promised that she will leave the estate to you". 8 The Plaintiff's father died in 1971. Under the terms of his Will, he left the Property to his wife or, if she should predecease him, to the Plaintiff. He left a Gulbransen Pianola to the Plaintiff. He left the balance of his estate (after deducting expenses and duties) to be divided as to three-fifths to his wife and as to two-fifths to his daughter. At that time, the Property was worth approximately $22,000 and the residual Estate was worth approximately $33,000. As a result, the Plaintiff received the Pianola and approximately $13,000. At about the time his Will was read, the Plaintiff's stepmother said to her words to the effect of "I promised your father that I will leave the house, [that is, the Property] to you and I will". 9 In June 1972, the Plaintiff executed a Deed between her, her stepmother and the Public Trustee. The copy of the Deed which was tendered was only executed by the Plaintiff. No doubt, its execution was proposed by the Public Trustee in connection with the finalisation of the Estate. The Deed records the terms of the Will. It also provides that the Public Trustee covenants to transfer to the Plaintiff and her stepmother their entitlements under the Will. The Deed goes on to provide that the Plaintiff and her stepmother: " HEREBY RELEASE AND INDEMNIFY the said Public Trustee and the estate of the said William Charles Merrett from and against all actions claims suits and demands whatsoever which they have or which but for this deed they might have had in respect of or arising out of the estate of the said William Charles Merrett AND for the consideration aforesaid they the said Gladys May Merrett and the said Elaine Hardman HEREBY COVENANT that this release and indemnity may be pleaded in bar to any action suit or proceeding now or hereafter taken by them or either of them in respect of the estate of the said William Charles Merrett …" 10 Only the last page of the Deed was executed. 11 The Plaintiff returned the executed Deed to the Public Trustee under cover of a letter dated 8 June 1972. In that letter she said: "As requested I have signed the release form regarding my father's estate. I do this under protest as I feel that I am in fact signing for receipt of the Pianola, which has not yet taken place." 12 In an affidavit sworn on 17 May 2010, the Plaintiff says that she recalls signing a document with respect to the distribution of her father's Estate. She says that at the time she thought that she was signing a receipt and that, to the best of her recollection, the document she signed comprised a single page. Although the Plaintiff was not cross-examined on this evidence, I do not accept it. The Plaintiff is elderly and frail. The events about which she gives evidence occurred approximately 38 years ago. Her contemporaneous letter made it clear that she was, and understood that she was, signing a release in relation to her father's estate. There is no reason to suppose that that release did not include all four pages even if only the last page was signed by her at the time. Although the Plaintiff says that she was signing the document under protest, it is clear from her letter that the reason for her protest was that she thought that the Deed also amounted to an acknowledgment that she had received the Pianola which was not something that had in fact occurred at that time. 13 In 2006, the Plaintiff's stepmother died. By her Will she left her estate to her husband or, if he should predecease her, to her brother. Both beneficiaries predeceased her and she has no other relatives. As a result, her estate passes to the Crown as bona vacantia. 14 The Plaintiff essentially makes three claims. First, she says that her father held the Property on a constructive trust for her. Second, she says that her stepmother did. Third, she seeks leave to bring a claim against her father's estate under the Testator's Family Maintenance & Guardianship of Infants Act 1912 ("the TFM Act"). 15 The gist of the first two claims is the same. In each case, the Plaintiff says that representations were made to her (by her father in the first case and by her stepmother in the second) that the Property would be left to her in the event that her stepmother predeceased her. The Plaintiff says that, in reliance on those promises, she acted to her detriment by failing to pursue a claim against her father's estate under the TFM Act and that consequently, in accordance with the principles of the law of promissory estoppel (as explained, for example, by Brereton J in Vukic v Luca Grbin [2006] NSWSC 41 at [27]), she should now be entitled to the proceeds of the sale of the Property. 16 It is difficult to see how the Plaintiff has any claim in respect of her father's estate. At the time the representation was made, her father was still alive and there was no possibility of a claim under the TFM Act. When her father died it was clear that he had left the Property to his wife. The Plaintiff could not have relied on any promise made by her father at that time. It was clear so far as the disposition of her father's estate was concerned that any promise made to her had not been kept. Knowing that, she still chose not to commence proceedings under the TFM Act. 17 In any event, in my opinion an insuperable problem with both claims is that the Plaintiff cannot establish that she relied to her detriment on the representations that were made to her. There are two reasons for that. The first is the release executed by the Plaintiff. The second is that, even if that release is ineffective, I do not think it is plausible that the Plaintiff relied on the statements which were made to her in deciding not to commence proceedings under the TFM Act. 18 Mr Lawson, who appeared for the Plaintiff, sought to challenge the Deed in various ways. First, he relied on the fact that the Plaintiff had only signed the last page. Secondly, he said that the Plaintiff did not understand the nature of the document which she was signing and for that reason it was not binding on her. Third, he said the Deed was not effective because it had not been signed by all parties. Fourth, he said that the release contained in the Deed was not sufficiently wide to cover a claim under the TFM Act. 19 In my opinion, none of these arguments has any merit. 20 I have already made findings in relation to the document that the Plaintiff executed. The fact that she did not sign each page of that document does not make it unenforceable. Section 38 of the Conveyancing Act 1919 sets out the requirements for an enforceable Deed. It says nothing to suggest that the document must be signed on each page. Section 38(1) simply says, relevantly, that the document must be signed. 21 As to Mr Lawson's second point, he suggested that the defence of non est factum applied in this case. There is no merit in that submission. There is nothing to suggest that the Plaintiff suffered from some disability or did not understand what she was doing when she signed the Deed. To the contrary, her letter dated 8 June 1972 makes it clear that she understood that what she was doing was signing a release regarding her father's estate. 22 As to Mr Lawson's third proposition, a Deed is enforceable against a party who has executed it whether or not the Deed has been executed by other parties unless it is clear from the Deed itself that it is not to take effect until all parties have executed it or unless it is delivered in escrow: see Lady Nass v Westminster Bank Limited [1940] AC 366. The likelihood is that the Deed was signed in counterparts. In any event, there is nothing to suggest that the release the Plaintiff gave in exchange for the distribution she received from her father's estate was intended not to be effective until the Deed was executed by all parties. 23 As to the fourth proposition, the release releases the Estate of the Plaintiff's father from all claims and demands "in respect of or arising out of the Estate". The words "in respect of" and "arising out of" have a wide meaning: see, for example, The Workers' Compensation Board of Queensland v Technical Products Proprietary Limited (1988) 165 CLR 642 at 653 per Deane, Dawson and Toohey JJ. In my opinion, a claim under the TFM Act is clearly a claim in respect of or arising out of the estate. 24 Even if the Deed were not effective, I do not accept that the Plaintiff acted to her detriment by not bringing a claim under the TFM Act. The Plaintiff gave evidence that she did so. However, I do not accept that evidence. The Plaintiff's father left a significant proportion of his estate to the Plaintiff. The balance of his estate was left to his wife. At the time, the Plaintiff was married and living independently. In those circumstances, there was no reasonable prospect of a claim under the TFM Act succeeding. Consequently, I do not think any decision on the part of the Plaintiff to refrain from bringing a claim under the TFM Act was as a result of any representation made to her. It was because that claim had no reasonable prospects of success. I do not think it is any answer to this point to say that the Plaintiff lost the opportunity of considering or seeking advice on a claim. That lost opportunity had no value. 25 For similar reasons any claim for an extension of time in which to bring a claim under the TFM Act must fail. 26 There is also another reason why the claim for an extension of time under the TFM Act must fail. Section 5(2A)(a) provides that any application for an extension of time must be brought before the final distribution of the estate. That requirement is clearly not satisfied in this case. 27 For these reasons I think the application should be dismissed and that there should be no order as to costs. However, Mr Lawson indicated that he may want to make submissions in relation to costs and to lead evidence in support of that application. In those circumstances, I give the parties leave to make an application to vary my order so far as costs are concerned by notifying my Associate that they wish to do so within 7 days of today's date. **********

Hardman v NSW Trustee & Guardian

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