BETWEEN : JAMES ROBERT THOMAS AS EXECUTOR OF THE WILL OF NANCY LOUISE WILSON (DEC)

Wills - Construction presumption against intestacy - Intention of testator - No new principles

Fell v Fell [1922] HCA 55; (1922) 31 CLR 268

Hendry v Perpetual Executors & Trustees Association of Australia Ltd [1961] HCA 44; (1961) 106 CLR 256

McNamara v Fleming, re Fleming deceased [1963] VicRp 3; [1963] VR 17

Minehan v Minehan [1965] WAR 196

O'Connor & Bruyn v Perpetual Trustee Co Ltd [1974] HCA 55; (1974) 5 ALR 47

Perpetual Trustee Co Ltd v Wright (1987) 9 NSWLR 18

Reardon v Mewburn, unreported; SCt of WA (White J); Library No 930049; 9 February 1993

Watson v Ralph [1982] HCA 35; (1982) 148 CLR 646

1 McKECHNIE J: This is an application by the executor of a will for a declaration as to the interpretation of certain clauses within the will.

2 The testatrix, Nancy Louise Wilson died on 14 December 1998. On 9 August 1998 she had made a will. The circumstances whereby she came to make the will are as follows.

3 Miss Wilson had been reluctant to make a will. However, in August 1998 she faced a hip operation. The husband of one of her nieces, Mr William Biffin, a school master, was asked to assist her in the making of a will. He was most reluctant to do so. A solicitor could not be obtained. So he attended at St John of God Hospital, took her instructions and wrote the will. He regarded the will as a "stop gap".

4 He prepared for the task by considering the sorts of matters which he thought ought to be covered in the will.

5 He attended Miss Wilson. She was frail and at times was confused. It took him many hours to take instructions and to complete the will. He went through the list of matters he had prepared.

6 There were times during the taking of instructions where she became agitated. Her sister, Mrs Margaret Strickland, was in constant attendance, although there were occasions when she left the room. Instructions were taken in the lounge area and later when Miss Wilson was in bed.

7 When all was ready, he read the will to her. She was so frail that she needed help to hold the pen when she signed. The will was executed.

8 The will contained a number of specific dispositions of property. Mr Biffin did not know that he ought to include a specific clause to deal with the residue of the estate.

9 Miss Wilson was very clear about certain matters, particularly the disposition of her house and the disposition of a Mercedes Benz motor car.

10 She was less clear about the disposition of her money and she seemed to be quite unclear as to the amount of her estate.

11 By her will Miss Wilson left her house at 25 Brady Road, Lesmurdie, to her close friend Leonie Stead:

"... with provision made for the tenancy of Rene Jamieson and Lynda Jamieson to continue for as long as it is mutually agreeable between Leonie Stead, Rene Jamieson and Lynda Jamieson."

12 The Mesdames Jamieson were tenants of Miss Wilson, but also friends. Ms Stead was a close friend. Miss Wilson was close to her sisters and wanted to make provision for her nieces and nephews.

13 After disposition of Brady Road to Ms Stead, Miss Wilson's will provided:

"I give and bequeath all shares which I may hold, all superannuation funds available and any other monies available from bank accounts and/or any other accounts in my name to be distributed as follows, subject to the payment of my just debts, funeral and testamentary expenses:

(a) TWENTY PERCENT to Margaret A. Strickland my sister.

(b) TWENTY PERCENT to my sister Lorna M. Thomas.

(c) TEN PERCENT to my close friend Leonie Stead.

(d) FIFTEEN PERCENT to my friend Rene Jamieson.

(e) FIFTEEN PERCENT to my friend Lynda Jamieson

(f) as to the remaining TWENTY PERCENT for equal division among such of them my nieces Jennifer Louise Biffin and Wendy Newton and my nephews Burns Hervey Newton, James Hibert Newton and Warwick Newton."

14 The will made provision in the event that Leonie Stead should predecease Miss Wilson.

15 The issue which arises is the construction of the will and the phrase "all superannuation funds available and any other monies available from bank accounts and/or any other accounts. ..." The issue arises because Miss Wilson had no superannuation funds, strictly so called.

"8. At the date of the deceased's death, the deceased held no superannuation funds. The deceased had 'rolled over' her superannuation funds and purchased 2 AMP Guaranteed Annuity Policies (the 'AMP Policies'), one policy being policy number H5353904-V, valued at $162,687.60 at the date of death and the other policy being policy number WK6000151-D, valued at $61,656.73 at the date of death. ..."

17 The executor's application seeks the following orders:

"1. The deceased intended that the proceeds of her 2 AMP Guaranteed Annuity Policies be distributed according to paragraphs (a) to (f) of her will.

2. To give effect to the deceased's intention, the word 'superannuation' in the deceased's will should be read to include the deceased's 2 AMP Guaranteed Annuity Policies which were purchased with rollover monies from the deceased's superannuation funds.

3. The costs of this Application be paid from the deceased's estate."

18 At the hearing the applicant was represented by counsel. The first defendant, who is a sister to the late Miss Wilson, appeared by counsel and argued that the will should be construed to result in a partial intestacy because there are no superannuation funds and there is no residuary clause.

19 The third, fourth and tenth defendants, Miss Wilson's friends, appeared by counsel and argued in support of the executor's proposed orders.

20 At the commencement of proceedings counsel for the first defendant objected to the admission of extrinsic evidence. I overruled the objection for reasons which will become apparent.

21 Counsel for the executor then formally read the following affidavits:

22 In short, the applicant adduced evidence from the executor, the person who had taken instructions on the will and drafted it, the testatrix's two surviving sisters, and her three friends.

23 The nieces and nephews played no part in the hearing.

24 Counsel for the first defendant objected to certain paragraphs in the affidavits of Lorna Myrtle Thomas. Those objections were upheld.

25 By leave, Mr Biffin, Ms Stead and Mrs Strickland were cross-examined on their affidavits.

26 I consider that all witnesses were giving truthful evidence to the best of their recollection.

27 Mr Biffin's first affidavit was completed by him at a time when he was working very long hours and did not properly put his mind to the issues. At that time he considered the estate was worth about $20,000 and although not satisfied with his affidavit, considered that, having regard to the size of the estate, it was sufficient. When he realised that there were significant questions about the construction of the will, and that the value of the estate was more like ten times his original estimate, he contacted the executor's solicitors and made a more detailed and careful affidavit. I have relied principally on that second affidavit as the more accurate version of his recollections.

28 In the affidavit evidence there are some differences between his account of the events of 9 August 1998 and that of Mrs Strickland. After hearing their testimony, I am satisfied that the differences are in fact minor. I consider that each of them had occasion to recollect matters somewhat differently. There has been a passage of years since 9 August 1998. The general tenor of their evidence is substantially in agreement.

29 There is a dispute in the affidavits between the evidence of Mrs Strickland and Ms Stead as to the extent, if any, which Ms Stead pressured Miss Wilson about making a will and its location. It is not necessary for me to resolve that issue. Although it may have some bearing on credibility, I nevertheless accept the evidence of Ms Stead that Miss Wilson was in the habit of referring to her insurance policies as "my super" or "my AMP" interchangeably.

30 Mr Biffin was with Miss Wilson for about five hours from 2.30 pm on Sunday 9 August. She was to be operated on the next day. She appeared to be tired and weak. At times she appeared vague. She spent most of the time discussing the particular dispositions, especially the house and the car.

31 Mr Biffin worked through the list and it was he who used the word "superannuation" or "superannuation funds". Miss Wilson advised him that she did not have superannuation any more. He was trying to deal with her entire estate but he did not know whether she was doing so.

32 He noted that when the question of superannuation was raised she became agitated.

33 Mrs Strickland also observed the same thing. When Mr Biffin asked about shares and superannuation her recollection was that Miss Wilson said: "I don't have any shares." She trembled a bit, and when "superannuation" was mentioned she jerked her arm, her hand shook and she seemed to be having a full blown panic attack. It was obvious that she did not want to talk about them at all.

34 Her recollection is that Miss Wilson appeared to know what she wanted to say but was groping for words. She said: "It's not to be touched."

35 Both Mrs Strickland and Mr Biffin agree that when the question of the distribution of money was raised, Miss Wilson initially spoke in terms of amounts of money, sums of some $2000 to $3000.

36 It seems that at some point Miss Wilson and Mr Biffin concluded there was about $20,000 in money available for distribution. Her comments about amounts specified must be seen in the light of that understanding.

37 Mr Biffin was concerned, paradoxically as it turns out, that there may not be enough money to accord with her wishes, especially when regard was had to funeral and testamentary expenses. For this reason he suggested that the bequests should be expressed in percentage terms. There was some discussion with Miss Wilson about the use of percentages. In particular she considered that Ms Stead should receive firstly somewhat less by way of cash and then later somewhat less by way of percentage because she was a major beneficiary, taking the house and contents. I am satisfied that Miss Wilson did agree to the expression of the bequest as percentages. In any event, her intention in this regard is best expressed by the clear terms of the will she signed.

38 The evidence of Ms Stead indicates that she often saw Miss Wilson reading and checking her policies.

39 She gave evidence, both on affidavit and in the course of cross-examination, that on occasions Miss Wilson would be in touch with her AMP representative Mr Robert John. She would receive and read AMP statements from time to time.

40 There are some well developed and settled legal principles which are applicable to the resolution of the present issue.

41 The duty of the court is to ascertain the testatrix's intention as expressed in the will. Evidence of her actual intention expressed outside the will is not admissible.

42 Where there is a latent ambiguity, extrinsic evidence is admissible to resolve the ambiguity. This is particularly so where the meaning of certain words is uncertain. For this reason I over-ruled the objection to the evidence.

43 Where the intention of the testatrix is not clear, there are rules of construction designed to give guidance and aid to the court. One rule of construction, described by Lord Esher MR as a "golden rule", is that a will ought to be read if possible so as to lead to a testacy, not an intestacy: In re Harrison, Turner v Hellard [1884] 30 Ch D 390.

44 This presumption is not an absolute presumption but is rebuttable, the guiding principle being always to construe the will in accordance with the wishes of the testatrix.

Application of legal principles to the facts

45 Miss Wilson executed her will at a time when she was frail, weak and at times confused, which is not to suggest that she lacked testamentary capacity, that issue being concluded by the grant of probate.

47 She said to him: "I don't want to make a will, but I suppose I have to." She then discussed with him in detail her wishes for the disposition of her estate. Although by themselves the words "that's separate" might indicate a desire to deal with the proceeds of the AMP policies separately, on the whole of the evidence I am satisfied that it was her intention in fact to make dispositions of her entire estate. I make that finding before taking into account the presumption against intestacy. When the presumption is applied, the conclusion is strengthened. She underestimated the value of that estate but the underestimation does not affect her intention. I do not consider on the evidence she was in any state of mind to be mischievous about the words "superannuation funds" knowing she had no funds properly so called, in order that they should be dealt with separately from her will. I find also that Miss Wilson's intention was to dispose of all the balance of her estate on a construction of the phrase "and any other monies available from bank accounts and/or any other accounts..."

48 The words "superannuation funds" originated from Mr Biffin. I find that Mrs Wilson knew that her superannuation monies had been rolled over into AMP policies. I further find that she did refer to those AMP policies from time to time as her "super" or "super fund". I find that when referring to "superannuation funds available" she was in fact referring to the AMP policies and the will should be construed accordingly.

49 Mr Biffin discussed with her the advantages of leaving the balance of her estate in percentage terms rather than actual money values. Although each of them my have been labouring under a misapprehension as to the actual value, I find that Miss Wilson accepted the advice to distribute the balance of her estate in percentage terms.

50 Those terms seem sensible. Sixty per cent goes to the family and the balance of 40 per cent is distributed to the friends. Of the 60 per cent that has been left to the family, 20 per cent goes to each sister and the remaining 20 per cent to the offspring of her deceased sister Mrs Newton.

51 The parties were all agreed that the costs of this application be paid from the estate. In the circumstances I consider that is appropriate and I will order the costs of all parties be taxed and paid from the estate.

1. the deceased intended the proceeds of her two AMP Guaranteed Annuity policies to be distributed according to par (a) to par (f) of her will;

2. to give effect to the deceased's intention the word "superannuation" in the deceased's will should be read to include the deceased's two AMP Guaranteed Annuity policies which were purchased with the roll-over monies from the deceased's superannuation funds;

3. the costs of the applicant, the first defendant and the third, fourth and tenth defendants be taxed and paid from the deceased's estate.