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[2004] NSWSC 647
Supreme Court of NSW
2004-06-30
Mr P
Original judgment source is linked above.
CITATION : Hensley v Verdi Hensley-Verdi v Verdi [2004] NSWSC 647 HEARING DATE(S) : 28, 29, 30 June 2004 JUDGMENT DATE : 23 July 2004 JURISDICTION: Equity Division JUDGMENT OF : Master Macready at 1 DECISION :
CATCHWORDS : Family Provision. Claim by a former de facto partner and the son of deceased. Estate not large enough to accommodate all claims particularly having regard to the costs incurred. Orders made in favour of both plaintiffs. PARTIES : Mary Elizabeth Hensley v Hector Edgardo Verdi and Guido Herman Verdi Leonardo Luis Hensley-Verdi by his tutor Pauline Helen Hensley v Hector Edgardo Verdi and Guido Herman Verdi FILE NUMBER(S) : SC 4786 of 2003; 1034 of 2004 Mr P Glissan for Mary Hensley COUNSEL : Mr C Simpson for Leonardo Hensley-Verdi Mrs M.A. Gilmour for defendants Mr Ken Le Lievre for Mary Hensley SOLICITORS : L. Rundle & Co for Leonardo Hensley-Verdi Grech Lawyers for defendants
4786 of 2003 Mary Elizabeth Hensley v Hector Edgardo Verdi and Guido Hernan Verdi. 1034 of 2004 Leonardo Luis Hensley-Verdi by his tutor Pauline Helen Hensley v Hector Edgardo Verdi and Guido Hernan Verdi. JUDGMENT 1 Master: This is the hearing of two applications under the Family Provision Act 1982 (NSW) in respect of the estate of the late Jose Alfonso Verdi who died on 18 July 2002 aged 52 years. The plaintiff Mary Elizabeth Hensley who lived in a de facto relationship with the deceased between 1990 and 1994 brings one claim. They have a child Leonardo who was born on 28 November 1991. The child Leonardo, by his tutor who is his grandmother, has brought the other proceedings against the estate on a defensive basis. I have ordered that both matters be heard together with the evidence in one being evidence in the other. The will of the deceased 2 The deceased made his last will on 3 July 2002 in which he appointed his brother Hector as executor. He provided for his investment in a friendly society to be paid to Leonardo's mother so that it could be used for his education. The will provided for the residuary estate to be divided equally between his sons Guido and Leonardo with Leonardo's share being held until he attains the age of 21 years with a provision for payment of $350.00 per month for his upkeep. 3 The son Guido is the deceased's son by his marriage to Carmen Cuevas. He is presently 30 years of age and lives in Perth, Western Australia. The deceased and his wife divorced in 1990 when Guido was 16 years old. Assets in the estate 4 The main asset in the estate was the deceased's house which has been sold for $468.000.00. The deceased had a car worth $34,000.00, cash of $99,791.91 and some other minor assets. The Friendly Society Scholarship fund, which provides education benefits for Leonardo over a period of his secondary and tertiary education totalling $49,359.09 has been transferred to the plaintiff Mary. 5 After the sale of the house there was a distribution of the balance of the estate. An amount of $240,905.72 was paid to Guido on 22 August 2003. The executor, for Leonardo's share, retained a similar amount. The amount held for Leonardo, as at 19 May 2004 was $246,572.46. 6 The costs incurred to date are as follows. The defendants' costs amount to $79,616.26 to the end of the third day. The plaintiff Mary's costs are estimated at $28,000 to the end of the second day and those of Leonardo are estimated at $38,084.98 to the end of the third day. These total $145,701.24. In respect of the defendants' costs, the second defendant has already paid the sum of $15,000.00 to the estate's former solicitors, Emmerson and Emmerson.
Family history 7 The deceased was born in approximately 1950 in Mendoza, Argentina. On 24 July 1950 Mary Hensley was born. She lived in Newcastle but worked in the United Kingdom for many years as a nurse. In 1979 Mary Hensley suffered fractures of lumbar vertebrae whilst nursing in London. In November 1985 a meningioma was removed from the left lateral ventricle of Mary Hensley's brain. She returned to Australia in the late 1980s. 8 Guido Verdi, the first child of the deceased, was born on 23 March 1974. In 1985, Guido Verdi says he recalled the deceased and his mother experienced marital difficulties and separated. In 1988 the deceased and his wife re-united and moved with Guido to Perth. In Perth they shared a home with another family.
9 In approximately 1989 the deceased and his wife purchased a house in Perth. They separated and Guido (aged approx. 15) resided with his mother. On 11 June 1990 the deceased and his wife divorced. In 1991 the deceased purchased a house at 93 Alfred Street, Rosehill, New South Wales. 10 It was in April 1991 that Mary Hensley says that she and the deceased commenced to reside together. It was also in 1991, at the conclusion of Year 11, that Guido Verdi left school in Perth and resided with the deceased in Sydney. Guido Verdi says he and his father returned to Perth and after a short time the deceased returned to Sydney. It was on 28 November 1991 that Leonardo Hensley-Verdi was born. 11 In approximately 1992 Mary Hensley returned to work full-time as a nurse. It was in November 1993 that Mary Hensley says she and the deceased set up a secondary education fund for Leonardo with the Australian Scholarship Group Friendly Society Limited.
12 In 1994 Guido Verdi says he visited the deceased and at the time of the visit the deceased was residing with Mary Hensley. In June 1994 the deceased and Mary Hensley attended counselling at Family Court, Parramatta. It was in early August 1994 that they separated with Mary Hensley and her son, Leonardo, moving to rented accommodation at 5 Eve Street, South Strathfield.
13 In approximately late 1994 Mary Hensley says she began to take Leonardo on short visits to Plaintiff. During 1995, she allowed him to stay overnight on the weekends.
14 On 20 February 1997 the deceased advanced Guido Verdi $50,000.00 to pay off his debts and provide a deposit for a house on terms that $30,000 be repaid by monthly instalments. It was on 18 March 1997 that Guido Verdi purchased a residence at Thornlie, Perth with his then de facto partner, Michelle Cook, with the assistance of a mortgage advance. Guido Verdi says he then made fortnightly payments to the deceased of $252.46 until late 1997. In late 1997 Guido Verdi says he ceased making fortnightly payments of $252.46 to the deceased and began making monthly payments of $340.00 until December 1999. 15 In August 1998 Mary Hensley and Leonardo moved to rented accommodation at 10 Wynstay Avenue, Enfield. 16 On 11 December 1998 Guido Verdi became the sole proprietor of the Thornlie property. This occurred because of the break up of his relationship with his girlfriend. The transfer and remortgage of the property allowed her to be removed as a mortgagor in respect of the property. 17 In November 1999 Mary Hensley sustained a further injury to her back whilst working as a nurse at the Drummoyne Early Childhood Health Centre. In early 2000 Leonardo commenced attending school.
18 It was in January 2000 that Mary Churnin says she first met deceased.
19 On 23 March 2000 Guido Verdi suffered the first of ten work related injuries resulting in worker's compensation claims.
20 Between September 2000 and February 2002 Leonardo underwent therapy with Angela Dixon, Clinical Psychologist, at Children's Hospital, Westmead. At his initial presentation she noted inattentiveness, distractibility, affect regulation difficulties, motor tics and specific learning difficulties.
21 On 11 November 2000 Leonardo attended Alison Lawson with a complaint of "experiencing reading difficulties and is two years behind his age matched level of reading". A diagnosis of visual dyslexia was made. A recommendation was made that Leonardo undergo eight treatments of one-hour duration per week accompanied by intensive homework exercises. In 2001 Leonardo Hensley-Verdi commenced attending Macquarie University Special Education Centre Music School.
22 It was in April 2001 that Mary Churnin says the deceased travelled to England and stayed with her until June 2001.
23 On 8 June 2001 Guido Verdi suffered the last of his work related injuries giving rise to worker's compensation claims.
24 On 8 July 2001 Mary Hensley says the deceased rang her from London sounding unwell. On his return she took the deceased to see a doctor.
25 In July 2001 Guido Verdi sold his Thornlie residence for $148,000.00. Guido Verdi says that deceased found out that he had cancer and requested that Guido visit him. The deceased paid the cost of his ticket.
26 On 13 July 2001 the deceased executed a joint power of attorney in favour of his brother, Hector, and his son, Guido.
27 It was on 17 July 2001 that Mary Hensley says that the Compensation Court awarded her $60,000.00 damages for injuries to her back sustained at work in November 1999 and that she applied the monies to purchase a motor vehicle, pay debts and living expenses.
28 On 31 July 2001 the deceased, having been diagnosed with stomach cancer underwent surgery at Westmead Hospital.
29 On 13 August 2001 Mary Churnin arrived in Australia and commenced to reside at Castle Hill.
30 On 5 September 2001 Mary Hensley commenced receiving a disability pension.
31 On 6 September 2001 Guido Verdi says he received $20,613.00 from the proceeds of the sale of the Thornlie property and, inter alia, repaid monies owed to his mother and $7,000 to his father.
32 In October 2001 Mary Hensley says that the deceased accompanied her to a car sale yard where she purchased a new Hyundai Sonata motor vehicle.
33 In December 2001 Mary Churnin moved into the deceased's residence at Rosehill and lived with him.
34 It was on 24 December 2001 that Mary Hensley says that she and Leonardo spent Christmas Eve with deceased and his family at Quaker's Hill. On 25 December 2001 Mary Hensley says the deceased drove to her home at Enfield where they had dinner with Leonardo and members of her family. Mary Hensley says that deceased told her Mary Churnin was moving in to help him with the washing, cooking and ironing.
35 It was in February 2002 that Leonardo's therapy with Angela Dixon, Clinical Psychologist, at Children's Hospital, Westmead concluded. She noted that Leonardo was also attending Macquarie University Learning Disability Unit.
36 In approximately February 2002 Mary Churnin says she purchased a home at Lake Macquarie with a view to her and the deceased spending their weekends there.
37 In March 2002 Mary Hensley says that the deceased was unable to drive his car and on Saturday mornings she would collect him and drive him to Enfield to watch Leonardo play soccer.
38 On 29 March 2002 Mary Hensley says that she, Leonardo and the deceased drove to Newcastle for Mary Hensley's sister's birthday.
39 On 17 April 2002 the deceased commenced receiving chemotherapy and on 28 April 2002 the deceased was admitted to Westmead Hospital for removal of blood clots.
40 In June 2002 Guido Verdi made application to withdraw part of his superannuation on compassionate grounds.
41 On 3 July 2002 the deceased's executed his last Will.
42 On 6 July 2002 an incident occurred at deceased's home on occasion of his birthday during a visit by Mary Hensley with her son, Leonardo. The deceased wanted to see his son but not Mary.
43 12 July 2002 was the deceased's last hospital admission.
44 On 14 July 2002 Guido Verdi returned to Sydney and resided at the deceased's house.
45 It was on 15 July 2002 that Mary Hensley says a conversation took place between her and deceased where he asked her to bring Leonardo to see him the next day.
46 On 16 July 2002 Mary Hensley and Leonardo attended the deceased at Westmead Hospital and he died on 18 July 2002.
47 On 24 July 2002 Guido Verdi received $12,261.00 released by his superannuation trustee.
48 On 19 November 2002 Probate of the Will of the deceased was granted to the First Defendant.
49 On 20 November 2002 there was a letter from Ken Le Lievre (solicitor for Mary Hensley) to Grech Lawyers advising that a claim under the Family Provision Act was to be made.
50 On 14 March 2003 the deceased's residence at 93 Alfred Street, Rosehill was sold for $468,000.00.
51 On 3 May 2003 the Executor published a Notice of Intended Distribution.
52 In May 2003, following "a deterioration of behaviour at home and concerns over school performance", Leonardo was reviewed by the Department of Psychological Medicine, Westmead Children's Hospital.
53 On 6 June 2003 Mary Hensley and Leonardo moved to rented accommodation at 34 Nirimba Avenue, North Epping. Pauline Hensley lent Mary Hensley $3,000.00 for a rental bond, removal expenses and Leonardo's school expenses.
54 On 21 July 2003 Leonardo Hensley-Verdi commenced attending Our Lady Help of Christians Primary School, Epping in Year 6.
55 On 1 August 2003 there was a Letter from Grech Lawyers to Ken Le Lievre, solicitor, noting "that Guido Verdi's share of the estate has been distributed to him".
56 On 22 August 2003 Grech Lawyers forwarded Guido Verdi $240,905.72 by way of partial distribution.
57 On 9 September 2003 Guido Verdi ceased full-time employment and commenced casual employment as a labourer/forklift driver for Challenge Recruitment.
58 On 10 September 2003 Mary Hensley filed the Summons in her matter.
59 On 27 November 2003 Guido Verdi received the deceased's household goods and personal effects.
60 On 9 January 2004 Leonardo Hensley-Verdi by his Tutor filed the Summons in his matter.
61 On February 2004 Leonardo Hensley-Verdi commenced attending St. Joseph's College. On 25 May 2004, Leonardo attended Darren Thomas at Irlen Dyslexia Centre for review when it was noted that his fluency and accuracy was improving as a result of his treatment. The eligibility of the plaintiffs 62 The plaintiff Leonardo is an eligible person and the plaintiff Mary Hensley will be an eligible person if at some time she was partly dependant on the deceased and part of his household. This is not in dispute in the present case and is clear on the evidence. 63 However it is necessary under s 9 (1) of the Family Provision Act that the Court first determines whether there are factors warranting the making of the application. This expression has been dealt with by courts on a number of occasions. In Re Fulop Deceased (1987) 8 NSWLR 679 at 681 McLelland J described that expression in the following terms: "Secondly, the subsection appears to be premised upon a distinction between 'factors which warrant the making of the application' on the one hand, and circumstances which would justify the making of an order granting the application, on the other; otherwise the subsection would be pointless. This means that in a particular case the Court might determine that there are 'factors which warrant the making of the application' within the meaning of the subsection, and yet go on to decide that the application should fail. Since the subsection applies only to certain classes of applicants, it suggests that those classes of applicants need to demonstrate some basis for their claims additional to that required of other classes. The difference between the two sets of classes of applicants, in broad terms, seems to be that the classes not affected by s 9(1) (lawful and de facto spouses and children) are as such generally regarded as natural objects of testamentary recognition by a deceased (of the Wills Probate and Administration Act 1898, s 61B), whereas the classes affected by s 9(1) (former spouses, and some time dependent grandchildren or household members) are as such not generally so regarded. This suggests that the 'factors' referred to in the subsection are factors which when added to facts which render the applicant an 'eligible person' give him or her status of a person who would be generally regarded as a natural object of testamentary recognition by a deceased. That the subsection is directed at a plaintiff's status as applicant in some such sense as this perhaps finds some support in the statutory direction to the Court, in the event that it determines the preliminary question adversely to the plaintiff, not to go on to determine the application, but 'refuse to proceed with the determination of the application.'" 64 In Churton v Christian (1988) 13 NSWLR 241, the Court approved this statement. After setting out and approving the above statement, Priestley JA at page 252 added: "To this I would add that although the classes affected by s 9(1) are not necessarily generally regarded as natural objects of testamentary recognition, in some cases members of those classes may, when the circumstances of their relationship with the deceased are set out, immediately be seen to be persons who would be regarded by most observers as, in their particular circumstances, natural objects of testamentary recognition."
65 These principles have been applied at first instance for many years. In recent times, the Court of Appeal gave further attention to this matter has in the case of Brown v Faggoter, a decision of Sheller JA, Sheppard AJA and Fitzgerald AJA given on 13 November 1998. Fitzgerald AJA, who seemed to suggest that an application might be warranted if the application has reasonable prospects of success, gave the main judgment. This seems to be a somewhat different and perhaps easier test than that which the Court of Appeal approved in Churton v Christian. I will consider the matter on both bases, given that there may be some flux in the state of the law in this regard.
66 The plaintiff's submissions as to what were the facts which demonstrated the factors warranting the making of the application were as follows:- "4. It is submitted that the following factors warrant the making of the plaintiff's application: (a) the fact that the plaintiff and the deceased lived in a domestic relationship within the meaning of the FPA between about April 1991 and August 1994, a period of about 3 years (see plaintiffs affidavit of 8 September 2003 - paragraph 10); (b) the plaintiffs contribution of a lump sum of $6,000 to the finances and property of the deceased and herself during that period - same affidavit, paragraph 13; (c) the fact that there was no property settlement between the deceased and the plaintiff under the Property (Relationships) Act 1984 - same affidavit, paragraph 19; (d) the fact that the plaintiff has continuously cared for the child of the deceased and herself, Leonardo, since separation, with relatively modest financial assistance from the deceased - same affidavit, paragraphs 13-18 and 56-8; and plaintiffs affidavit of 10 May 2004 - paragraph 3 and annexure 'A'; (e) the fact that in late 1997 the deceased promised to provide the plaintiff with a property settlement of $50,000, to enable Leonardo and her to have secure accommodation, but did not do so - see plaintiffs affidavit of 8 September 2003 - paragraphs 24-6 and annexure 'G'; (f) the fact that the deceased acknowledged in his Will his duty to contribute towards Leonardo's living expenses during his minority by way of payments to the plaintiff of up to $350 per month from the interest earned on Leonardo's share under the Will whilst held in trust for him - see clause 5(iv); (g) the fact that such contribution to the cost of Leonardo's living expenses ($80.77 per week) is insufficient to meet the costs of Leonardo's living expenses - see plaintiffs affidavit of 15 June 2004 - paragraph 3 and annexure 'A' (h) the plaintiffs severe ill health (cervical and lumboscral spondylosis; left hemisphere brain tumour or meningioma; thyroid malfunction; asthma; and arthritis) - see plaintiffs affidavit of 8 September 2003 - paragraphs 62-3 and affidavit of Paul Darveniza of 2 June 2004; (i) the plaintiffs impecuniosity and inability to meet living expenses of Leonardo and herself see plaintiffs affidavits of 29 March 2004 and 15 June 2004, in particular annexure 'A'; (j) the fact that following separation the plaintiff and the deceased resumed sexual relations until about the end of 2000 and the plaintiff assisted the deceased by referring painting work to him, by visiting the deceased's mother Irma when she was terminally ill in Westmead Hospital between late August 2000 and 6 October 2000, by assisting the deceased to organise his mother's funeral, by providing him with emotional support and companionship at that time, by driving him to and from medical appointments and to Leonardo's soccer games on Saturday mornings, by taking Leonardo to the deceased for access visits, and by contacting a Dr Wilkens at Westmead Hospital to arrange a bed for the deceased when he was terminally ill - see plaintiffs affidavit of 8 September 2003 - paragraphs 21-2, 27-30, 34-5, 39-42; plaintiffs affidavit of 5 November 2003 - paragraphs 7-8, and exhibit 'C'." 67 It is clear that there was a domestic relationship between the plaintiff and the deceased for a little over three years between April 1991 and August 1994. This is an important factor to consider on this aspect. It is also clear on the evidence that the plaintiff did contribute the sum of $6,000.00 to the parties' finances during the relationship and it is true that there has been no property settlement between the deceased and the plaintiff. This would normally be a relevant factor, but in the circumstances, where both contributed to the household and the plaintiff's contribution was somewhat minimal, it would mean that any claim that the plaintiff would have would at most be fairly minimal. The plaintiff did not make a property settlement claim during the deceased's lifetime initially, because she was frightened of him but later, more in the hope that they would get back together again and ultimately marry. It is plain from the evidence that although they separated the plaintiff had an abiding attachment to the deceased that was not reciprocated. 68 The matters in the submissions concerning the care for the son, Leonardo, I do not think are of significance on this aspect. The parties agreed to the arrangements and the deceased was acknowledging his obvious liability, morally and legally to care for his son before and after his death. The fact that the plaintiff is in ill health which I will refer to later, is a factor which can be considered under this heading provided there are sufficient other aspects or facts available to come to the appropriate conclusion. 69 I am prepared to accept the evidence of the plaintiff that she still had a sexual relationship with the deceased up until the end of 2000. Even on her own admission that relationship was not an exclusive one as for some years the deceased was seeing a friend. In addition, I am satisfied that by 2001 the deceased was having a relationship with Mary Churnin. It is plain from the evidence that although the plaintiff was strongly attached to the deceased, the deceased did not reciprocate her feelings and wished to see less of the plaintiff who no doubt used her position as Leonardo's mother to continue her association with the deceased. Notwithstanding these comments, I am satisfied that there was some assistance to the deceased such as taking him to see Leonardo play soccer and assisting him with his mother's funeral. There were also occasions when the plaintiff took the deceased to medical appointments. 70 In a statutory declaration made on 13 July 2001 the deceased said the following in paragraph 3: "I have made no provision for Leonardo's mother Mary Hensley. She and I lived together for approximately two and a half years at my house at 93 Alfred Street Rose Hill from mid - 1991. She then moved out. During the time that we lived together, we shared expenses for Leonardo and shared other expenses in much the same as flat mates do with the exception that she paid nothing by way of rent. I made all mortgage payments and paid all rates and maintenance expenses for the property. Some months after the birth of Leonardo she returned to work fulltime. We had separate bank accounts. She continued to work fulltime until approximately four months ago. I am aware of the possibility of a claim against my Estate and it is for this reason that I am making this declaration. I believe that I have made proper maintenance and provision to assist Mary to bring up Leonardo. In all the circumstances I do not consider that I have an obligation to make additional provision for her." 71 In my view the deceased was in error as to the extent of the time given the relationship concluded in 1994. Apart from this, the matters referred to by the deceased were probably accurate. However, I do not agree with the deceased's conclusions as to whether or not he should provide for the plaintiff. Having regard to the period of their cohabitation, the lack of any property settlement, the present health of the plaintiff and the care she extended to the deceased in the last years of their relationship, there are factors warranting the making of the application on the traditional basis. 72 I will now turn to consider the application generally to see whether there are prospects of success. 73 In applications under the Family Provision Act the High Court in Singer v Berghouse (No 2) (1994) 181 CLR 201 set out the two stage approach that a Court must take. At pages 209-210 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 for 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 there may be some circumstances in which a court could refuse to make an order notwithstanding that the applicant is found to have been left without adequate provision for proper maintenance. Take, for example, a case like Ellis v Leeder, where there were no assets from which an order could reasonably be made and making an order could disturb the testator's arrangements to pay creditors." Situation in life of Mary Hensley 74 The plaintiff Mary Hensley is aged 53 years, she is single and has the responsibility of bringing up her son, Leonardo. Her life expectancy is 30.4 years and although there was some reference in submissions to a shorter life expectancy, the evidence of this does not seem to be available. The plaintiff has assets consisting of furniture worth $10,000.00 and a 2001 Hyundai motor vehicle worth $14,500.00. She owes the Teachers' Credit Union $25,799.91, David Jones $826.26 and her mother $3,000.00. She also has outstanding school fees for Leonardo, which she has incurred with St Joseph's College, Hunters Hill, totalling to date $12,251.53. No doubt another instalment will shortly become due. 75 Her income, including the sum of $350 per month under the will, is $1,365.73 per fortnight. Her expenses excluding her nurses' registration which seems superfluous, are $1,753.00. This is a deficiency of $193.00 per week. If the $350 per month ceased the deficiency would rise to $273.00 per week. However, she would be entitled to payment from Leonardo's trust fund at an amount which will depend upon the outcome of the case and the impact of costs. 76 As has been indicated in the chronology, the plaintiff has had a number of medical problems and effectively she now no longer works. Dr Paul Darveniza, a physician and neurologist who has seen the plaintiff over a number of years, gave evidence. His discussion of her most recent visit as per his affidavit sworn 2 June 2004 is as follows:
"On review on 17th May 2004 she tells me she continues to suffer from more or less constant neck and low back pain according to lifting, bending and stooping which she minimises as much as possible. She can do her usual household chores but in pain, but she avoids heavier tasks such as gardening or vacuuming as much as possible. Currently she can sit for a maximum of two hours, and standing and walking are limited by knee pain. She avoids running. In the interim, she had also developed sleep apnoea confirmed on sleep studies, of mild to moderate degree, treated with weight loss and sleeping on her side. Also for the past two years she had had increasing knee pain and swelling, left greater than right, and she avoids squatting which hurts the knees but she can kneel. Sometimes knee pain wakes her from sleep at night. She treats her knee pain with heat packs, magnets, anti-inflammatories and liniment. It is noted that she has not worked as a nurse since 2001 and she has been compensated for her spinal problems and is also on a disability pension. Unfortunately, her thinking is still slow and disorganised and she has considerable difficulty understanding what is being said, especially in pressured circumstances and she often loses the plot when expressing her self, again when pressed. She says she can calculate accurately but slowly, read but can't concentrate to do so, and she can write but finds it easier to use a computer. She sometimes gets quite flustered and panicky when trying to understand or express herself quickly. Currently, she takes Ventolin and Flixotide for her asthma which is reasonably well-controlled, Losec 20 mg daily for indigestion, thyroxine 100 mcg five times per week and 200 mcg two times per week for hypothyroidism, and Zocor 20 mg daily for a high cholesterol. On examination on 17th May 2004 there was a slight but significant receptive and expressive dysphasia and she tended to become flustered when the topic of conversation became more complex. On further examination, there was a right upper quadrantic field defect, slight impairment of fine finger movements on the right, painful limitation of neck flexion and extension, a normal range of back movements and no paraspinal muscle spasm. Knee jerks were only present on reinforcement. There was some swelling of both knees but a full range of movements and no lassitude of the ligaments. The remainder of a full neurological and general medical examination was normal. Blood pressure was 140/80 in the right arm sitting and no bruits were audible over the head or neck. Clinically, this lady has a number of medical problems including work-related, symptomatic cervical and lumbosacral spondylosis, controlled hypothyroidism, sleep apnoea confirmed on overnight sleep studies, indigestion, a high cholesterol, significant osteoarthritis of both knees and she is also known to suffer from recurrent intraventricular cerebral meningiomas which are being monitored. The meningiomas required surgery and have left her with a right superior field defect, a significant expressive and receptive dysphasia and disorganised and at times muddled thinking. In my opinion, she is unfit for gainful employment but is managing at home to look after her 12 year old son etc." 77 There was no challenge to this evidence and it is plain that the plaintiff now has difficulty managing to spend the time necessary to take Leonardo to his various activities. The proposals for his schooling at St Josephs would assist in this regard. 78 I have referred earlier to the continuing relationship between the plaintiff and the deceased after they separated but it should also be noted that there was evidence that suggested that the period of their relationship was not a particularly happy one, due mainly to the deceased's temper. Situation in life of Leonardo Hensley-Verdi 79 Leonardo is 30 years of age and as I have indicated above he lives with his mother. His tutor is his grandmother on his mother's side. He has no assets other than his entitlement under the will of the deceased. However, the amount of the education fund is available for his benefit. The fund provides benefits on a yearly basis for his secondary and tertiary schooling if he proceeds that far. The amount of the benefits provided which I have referred to earlier will allow him to attend a Catholic school such as St Pious College at Chatswood. The amount is nowhere near enough to support him at St Josephs College, Hunters Hill. 80 During the hearing there was debate as to the appropriateness of the school care that should be provided for the plaintiff, Leonardo. Included in this debate was the question of whether or not it was the deceased's wish that he should attend St Joseph's College. Whether or not it was the deceased's wish or not is probably irrelevant but the evidence would seem to disclose that enquiries about his enrolment were being made by the plaintiff, Mary Hensley prior to the deceased's death and he was enrolled shortly after the deceased's death. 81 There was fairly extensive medical evidence as to the condition of Leonardo. Leonardo has been diagnosed as suffering from Irlen syndrome which is a perceptual dysfunction and form of visual dyslexia which affects how the brain interprets the message received from the printed page and the environment. This gives particular problems when dealing with exams and in learning. He has to wear special glasses and requires assistance in examinations. A psychologist has seen him and she has made recommendations on various behavioural strategies to help Leonardo with his progression. His difficulties mean that he finds homework more difficult than other children and he requires extensive supervision. The submissions on behalf of Leonardo suggested that the following factors led to the conclusion that St Joseph's College was the most appropriate schooling for him: "a) The provision of extended after-school facilities and care for the children. That is of particular significance in the present case because Mary Hensley is a sole parent with significant physical limitations and it is reasonable to assume, both from Dr. Darveniza's report and Mary Hensley's presentation in the witness box, that Leonardo's development will be best encouraged by an arrangement of that kind. This will be increasingly so as he gets older and the potential for conflict between mother and son increases. This will be particularly so in relation to the supervision of homework and after hours activities;
b) The need for this assistance is accentuated by the clear rupture in the relationship between Mary Hensley and the deceased's immediate family which deprives Leonardo of assured continuous contact with male role models;
c) Mary Hensley's health gives rise to a real risk that Mrs. Hensley, Snr. may have the burden of Leonardo's care imposed on her. In that respect the observations of Dr. Darveniza at page 5 of his report are of particular significance, viz, 'She is also known to suffer from recurrent intraventricular cerebral meningiomas which are being monitored.'
d) It is this condition which previously required surgery leaving Mary Hensley with a ' right superior field deficit, a significant expressive and receptive dysphasia and a disorganised and a time muddled thinking' . In short, there is a real risk which must be recognised that Mary Hensley could come to further surgery because of the recurrent nature of that condition. Some features of the condition identified by Dr. Darveniza were evident in Mary Hensley's evidence;
e) Leonardo will have the support of two cousins attending the school in 2005 and 2006 respectively;
f) The evidence discloses he is happy and his last school report indicates he is progressing well." 82 I accept these submissions and it is plain that if it were possible for Leonardo to attend St Joseph's College, on the evidence before that would be in his best interests. 83 It is clear that the deceased had a good relationship with Leonardo during his lifetime and obviously cared for him and wanted to provide for him in his future. 84 It is necessary to also to consider the situation of others having a claim on the bounty of the deceased. The relevant person is the deceased's first son, Guido Hernan Verdi. The situation in life of Guido Hernan Verdi 85 Guido is 30 years of age, is single and has no dependents. He lives in rented accommodation in Perth, Western Australia. Apart from personal effects and furniture Guido has the sum of $159,000.00 in a term deposit with the Bendigo Bank. This is the balance of the funds that he received from the estate of his late father. He used part of the funds to pay off debts that he had incurred. He has a car worth $1,000.00 and superannuation benefits of approximately $3,000.00. 86 Guido left school at the end of the first semester of Year 11 as he was having difficulty keeping up his schoolwork. He was suffering from emotional problems that were the subject of evidence before me. He started working in various manual labour positions. In 1999 he took recreational drugs such as Marijuana but he has been drug free since September 2002. He has had a varied work history having had some 32 jobs between 1998 and 2004. These include courier, storemen, salesman, forklift driver and various labourer positions. He has had a number of worker's compensation claims and receives payments from time to time in respect of injuries to his back. He has no prospect of any further worker's compensation claims. At the moment he is living on the income from the investment he has with the Bendigo Bank. Dr Stephen Proud, Consultant Psychiatrist, gave evidence before the court. His report summarised Guido's position as follows: "Mr Verdi is a twenty-nine year old, socially isolated man who has developed personality difficulties, possibly as a result of a difficult and somewhat lonely childhood. He has never directly attended to his emotional difficulties and as a consequence has performed poorly in all areas of his life, including his occupational, financial and interpersonal domains. Mr Verdi has 'a chip on his shoulder with a tendency to become irritable, vexatious and 'suspicious' and this has certainly contributed to his poor work history and interpersonal difficulties.
As he matures, he is developing some insight into his situation and some ability to regulate the more problematic elements in his personality with the assistance of religion. He has steadfastly turned away from seeking psychological and psychiatric help but he is currently more predisposed to accessing such help. As a result of his failure to achieve important, financial and interpersonal goals in his life, he has become significantly depressed and for many years has been suffering from undiagnosed and untreated Major Depression.
Mr. Verdi has the intelligence and cognitive ability to manage his own affairs but because of his untreated depression he could make misjudgments in interpersonal and financial matters until his depression is adequately treated. Should he not address his personality problems, then he will continue to have difficulties in life, and continue to under-perform occupationally and interpersonally.
My impression is of a man of sufficient intelligence who has underachieved, and should he address his current Major Depression and his longer term personality issues and childhood issues, then his chances of improving his mental health and subsequent success in live will be immeasurably increased. I would thus suggest that Mr Verdi enter into long-term psychotherapy with a Psychologist (one year of psychotherapy, one visit per fortnight at a cost of $150 per visit). He also requires five to ten appointments with a Consultant Psychiatrist to treat his current Major Depression at a cost of $150 per appointment).
Once he has undergone the psychological treatment he would then be in a better position to manage his own affairs and make mature decisions regarding his education and future work opportunities. Mr Verdi would be wise to use his inheritance to fund his mental health treatment requirements as this will give him the stability to then begin to correct his 'lapses' in life. Having treated his mental health, he would then be wise to use his inheritance to further his education so that his educational achievement is consistent with his underlying abilities, as he has certainly under achieved because of not addressing his emotional difficulties.
Mr. Verdi could also use his inheritance to purchase stable accommodation. With the security of accommodation, a better educational attainment, and an improvement in his mental health, there is no reason why Mr Verdi could not achieve the potential which he has so far failed to achieve (in fact he has 'damaged' himself and is way behind where he should have been at this stage in his life." 87 It is clear that Guido does need further assistance, which would enable him to progress in his life. Guido had a good relationship with his father and was willing to come from Western Australia to visit his father when his father was ill. On one occasion he drove from Perth to Sydney and back in order to see his father. 88 Provision was made during the lifetime of the deceased for Guido and this consisted of providing a sum of $50,000.00, which was comprised of a gift of $20,000.00 and loan of $30,000.00. This enabled Guido to obtain a property in Western Australia. Ultimately, as a result of the breakup of his relationship with his girlfriend he was not able to continue living in the property and it was sold to meet his escalating debts. 89 It is plain that in the past Guido has had difficulty managing his finances and at times he has made some rash decisions in respect of purchases of cars and boats and other matters. However, notwithstanding this problem he managed to pay back to his father at least $20,000.00 of the $30,000.00 loan. 90 Guido appeared to me as someone who has had a difficult past and needs psychological help in the future. His needs are real and clearly they were recognised by his father. Discussion of the claims 91 The present matter concerns a relatively small estate part of which has been distributed and spent by Guido. In order to assess the claims it necessary to see how the plaintiffs say they have been left without adequate and proper provision for their maintenance, education and advancement in life. 92 I turn to the claim by the plaintiff, Mary Hensley. The claim advanced by Mary Hensley was for the following amounts.
98 In Marshall v Carruthers [2002] NSWCA 47 Hodgson J had the following to say:
"63. The Master found that Ms Carruthers had a strong claim, and I agree with that finding. However, the strength of a claim of a surviving partner does, in my opinion, vary with circumstances. Although the Family Provision Act does, in some respects, equate de facto spouses with de jure spouses, this does not, in my opinion, make the existence or otherwise of a marriage irrelevant. In my opinion, a formal and binding commitment to mutual support through good times and bad, other factors being equal, adds strength to a legitimate claim. In my opinion also, the length of a relationship and contributions to the relationship can affect the strength of a claim. One factor which may be particularly important in a claim by a woman is that a woman may have, to the detriment of her own financial prospects, taken a major role in raising the children of herself and the deceased.
64 The Master referred to the following statement of principle which appears in Luciano v Rosenblum 2 NSWLR 65 at 69 It seems to me that, as a broad general rule, and in the absence of special circumstances, the duty of a testator to his widow is, to the extent to which his assets permit him to do so, to ensure that she is secure in her home, to ensure that she has an income sufficient to permit her to live in the style to which she is accustomed, and to provide her with a fund to enable her to meet any unforeseen contingencies.
65 I do not think it is to be assumed that this statement is to apply in all cases, particularly where factors such as those I have mentioned are absent. In my opinion, it is not clear that this statement would apply to applications by widowers. The difference in attitude that the Court may take to applications by widowers is due in part, I think, to economic disadvantages which women still face. One important aspect of this is the economic disadvantage occasioned by the greater responsibility which women often take in looking after children. That factor is of course absent here." 99 When considering the plaintiff, Mary Hensley's claim and the comments of Hodgson J, it is plain that one is dealing with a relationship of some three years which had ceased some eight years before the death of the deceased. The plaintiff's health problems are incapacitating but notwithstanding these problems she cannot expect substantial provision from the estate of the deceased measured by the extent of the relationship she had with the deceased and the earlier matters I have mentioned in this judgment. The size of the estate simply will not accommodate a large claim even if it were warranted and the amount of costs which will have to be borne by the estate is also to be considered. Potentially they amount to approximately $150,000.00. The problem is that Guido's share has been distributed to him and the trustee holds Leonardo's share to which he can resort to meet all the costs. There are some fundamental problems with costs in this matter. 100 The estate pursued an application for security for costs against Mary Hensley which they lost. Costs were reserved for my discretion. Given the decision I will make, the plaintiff, Mary Hensley, should have her costs out of the estate on that matter. Whether the defendant should have his costs out of the estate is another matter. 101 The defendant's costs have been substantially increased by the distribution to Guido which meant he had to be added as a defendant. As I point out later, the distribution was premature. 102 The defendants were critical of the bringing of Leonardo's proceedings. However, they were necessary due to the conflict of interest affecting the first defendant and the restrictions in the will on the limited amount which could be paid towards Leonardo's upbringing. It also enables the fund to be free of the disadvantages of treatment as a result of the operation of ss99 and 99A of the Income Tax Assessment Act 1936 (Cth). It is also apparent that the defence of Mary Hensley's claim involved an attack upon many aspects of Leonardo's entitlements as a beneficiary and meant that it was necessary for his proceedings to be brought. 103 In the circumstances, it seems to me that the plaintiff, Mary Hensley, should receive a legacy in the amount of the outstanding school fees and an amount sufficient to discharge her existing debts of $29,626.17. It is also clear that the second plaintiff should succeed and there should be an order in terms of paragraphs 2 and 3 of the Amended Summons filed 28 June 2004. Directions can be given to allow the payment of his fees to St Joseph's College in advance to receive the benefit of no further increases. The income on the balance is to be paid for his benefit until he turns 18 when he will be entitled to the capital. 104 In considering the burden of costs' orders, I will keep in mind Guido's situation. He needs help in the future and must receive a substantial part of his bequest. In respect of the legacy to Mary Hensley the burden of the unpaid St Joseph's College fees should fall on Leonardo's share. The burden of the sum for her debts should be born equally by Leonardo's and Guido's share. Both plaintiffs' costs on a party and party basis to be borne equally out of both children's share. 105 In respect of the defendant's costs there are some questions as to the amount of these and, accordingly, I would propose to direct the first defendant to verify, file and pass his accounts and to the extent such costs are passed such costs are to be paid equally from the two children's shares. 106 In respect of Guido, his share has been distributed and the Court may make an order designating his bank account at the Bendigo Bank as a notional estate for the purpose of any payment in respect of costs and the legacy. Before doing so the Court is required to consider the matters referred to in s 27 of the Family Provision Act which is in the following terms: " 27 Designation of property as notional estate - matters to be considered. (1) On an application in relation to a deceased person, the Court shall not make an order designating property as notional estate of the deceased person unless it has considered: (a) the importance of not interfering with reasonable expectations in relation to property, (b) the substantial justice and merits involved in making or refusing to make the order, and (c) any other matter which it considers relevant in the circumstances. (2) In determining what property should be designated as notional estate of a deceased person, the Court shall have regard to: (a) the value and nature of property the subject of any relevant prescribed transaction or distribution from the estate of the deceased person, (b) where, in relation to any such prescribed transaction, consideration was given, the value and nature of the consideration, (c) any changes over the time which has elapsed since any such prescribed transaction was entered into, any such distribution was made or any such consideration was given in the value of property of the same nature as the property the subject of the prescribed transaction, the distribution or the consideration, as the case may be, (d) whether property of the same nature as the property the subject of any such prescribed transaction, any such distribution or any such consideration could, during the time which has elapsed since the prescribed transaction was entered into, the distribution was made or the consideration was given, as the case may be, have been applied so as to produce income, and (e) any other matter which it considers relevant in the circumstances." 107 Distributions were made in this case in spite of full notice of the claim being made by the plaintiff, Mary Hensley, and before the time had expired within which claims were made. There are no matters which would inhibit the making of an order under sub-section 1 of section 27. See D'Albora v D'Albora (1999) NSWSC 468.
108 I direct the parties to bring in short minutes.
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