Madden-Smith v Madden

The Plaintiff 4The plaintiff is the youngest sister of the defendant. Much evidence was given about her poor character and conduct by close relatives who were in a position to observe her. They included her brother (the defendant), her cousin (Trevor Mohr) and her aunt (Carole Heaven). When I asked the plaintiff whether there was anything she would like to say in response to the affidavits of Mr Mohr and Mrs Heaven, she answered glibly, in words to the effect that she never liked Mr Mohr anyway and that she had not seen Mrs Heaven for a long time. In the short time that she was in the witness box, she was frequently non-responsive and occasionally aggressive. I formed the view that she was not a reliable witness and that, where there was a conflict, I should prefer the evidence of her brother, her cousin and her aunt. 5The plaintiff is now 50 years of age. At an early age she married a man named Rodney Smith. They had four children. In 1992, when Mr Smith was 32 years old, he died of cancer. During her husband's illness, the plaintiff formed a relationship with another man. After the new relationship commenced, she was charged with a number of offences relating to driving under the influence of alcohol. Then in about 2000, she was convicted of a number of drug charges, including the cultivation of marijuana. The cultivation apparently occurred in an old railway carriage on the parent's land. These matters naturally strained the relationship between the plaintiff and her parents. Mrs Heaven said that the plaintiff's father said to her: I am so ashamed. I just want Sue off the property. I would burn the house down if it would get her out. 6Mr Mohr said that the plaintiff's parents were mortified by their daughter's criminal behaviour. He said that they spoke to him of the shame and embarrassment that they felt as a result of their daughter's arrest and conviction. They were, he said, conservative people, who saw themselves as responsible citizens of Narrandera, who prided themselves on their good reputation. Mrs Heaven said that they regularly expressed criticisms to her of the plaintiff's lifestyle. 7The plaintiff's criminal behaviour has continued. Last year she served four months in prison after conviction for another drug offence. This offence involved a different man with whom she was living at the time of the offence. The charge related to possession of cannabis with a street value of $20,000. She is still subject to a good behaviour bond. She was also charged with a firearms offence but was apparently acquitted of this charge. She explained in evidence that her male companion was responsible for that matter. 8From at least 2004 until her death in 2009, the relationship between the plaintiff and her mother was marked by escalating unhappiness and unpleasant conduct on the plaintiff's part. Mr Mohr said they appeared to argue all the time. He added that whenever the plaintiff disagreed with someone, she was 'very abusive and uses very confronting language'. He said that by 2007, it was obvious that the arguments were occurring every week and that the plaintiff's mother had become exhausted by the level of confrontation and conflict. He formed the view that the stress of the frequent confrontational arguments was 'severely damaging to my Aunt's health'. He said that the plaintiff's mother suffered from severe rashes which worsened after stressful incidents. After meetings with the plaintiff, she appeared to be 'tired, disappointed, exhausted'. When she died in 2009, she was 79 years of age. 9One particular matter seemed to be a flashpoint for the plaintiff's aggression. From the 1990s the plaintiff resided in a small cottage on the meagre 10 acre farm which her parents owned and where they also lived in the principal dwelling on the property. In about 2007, the plaintiff's mother decided that, given her advanced years, she should sell the farm and move into a house in Narrandera. The plaintiff had been living rent-free in the cottage for many years. It is obvious that she had a sense of entitlement but I am satisfied that no such expectation was justified and there was no reasonable basis for it. Among other things, it took no account of any entitlement of her siblings. I reject the plaintiff's evidence that her mother or father told her that the farm would be hers one day. I do not believe her. 10In 2007 the testator needed to sell the farm to purchase a more convenient home in town for herself; one that was closer to her friends and the amenities and services that sustained her. She never had any intention of giving the farm to the plaintiff. The only possible option, if one excluded the claims of her siblings or others, was a sale to the plaintiff. But the plaintiff adopted an aggressive approach, unilaterally engaging solicitors on her own behalf and proposing a purchase price to her mother that was unrealistic and unfair. 11There was another related aspect. It is tolerably clear that the testator had good reason to be concerned that the plaintiff might misuse any property or money that was given to her; that she could not be trusted to act responsibly. The plaintiff's history of involvement in drugs and alcohol concerned the testator. She made her position known to her son, the defendant, around the time that she made her last will. She informed him that she wanted to provide for the plaintiff's children when they turned 25 years of age but that she was not prepared to entrust any monies to the plaintiff. As the terms of her will made clear, she entrusted that responsibility to her son and his co-trustee. 12I am satisfied that the decisions made by the testator in relation to the sale of the farm and the terms of her will were understandable and reasonable in the circumstances. In the last year years of the testator's life, her relationship with the plaintiff was a torment. Some of the plaintiff's behaviour towards her mother bore the hallmarks of a termagant. Her conduct reinforced, and probably strengthened, the testator's resolve to do what she thought was appropriate. 13I do not think it matters that in 2006 the testator's then will provided for equal distribution of her estate among her three living children. I do not infer that in 2006 the testator was necessarily more tolerant of the plaintiff's behaviour in connection with drugs and alcohol. And even if she was, it would not matter. The question of what is 'adequate' and 'proper' is one for the court and does not necessarily require me to attempt to divine the motivations and causes that lay behind the 2006 will. A fortiori when the testator is dead and cannot explain her reasons. It cannot logically follow that simply because the testator's 2006 will provided for equal distribution among her children, that equal distribution should therefore be considered to be 'adequate' and 'proper' as far as the plaintiff is concerned. What is clear at least is that in 2007 the testator appears to have applied herself thoughtfully to the competing claims of her children and her nephew. The question is whether, in those circumstances, the law should interfere with the testator's freedom of testamentary disposition. I think not.

The Plaintiff's Circumstances 14The testator left nothing for the plaintiff but provided for her children. She adopted the same approach for the plaintiff's sister about whose circumstances there was no evidence. I have already mentioned some features of the evidence concerning the plaintiff, but I should explain her financial position and the evidence of her health. There is no doubt that the plaintiff has little in the way of money and assets. Her relative penury is however partly a consequence of the life she has chosen to lead. For a considerable time she has fluctuated between criminality and respectability. 15I have endeavoured with some difficulty to reconcile the plaintiff's employment evidence. In an affidavit sworn in September 2011, she said that she was working at Pacific Pine in Leeton selling furniture and earning approximately $650 per week. She also said that she had a second job at 'Ben Venutis' as a kitchen hand, earning approximately $160 per week. At the hearing, the plaintiff said that her current job was as a cleaner at the Camelia Hotel where she had started working one day a week before moving to seven days a week. She explained that now 'they are looking, they are training me for management so that I could do lots more work'. She said that her gross income per week from employment was between $250 and $300 and that she also received a government benefit called 'New Start' which varies according to her earnings from her employment. She said that the benefit is now $200 a fortnight but that it had been $316. The plaintiff has no savings nor superannuation but her evidence of the proposal that she be trained for management at the Camelia Hotel suggests that she is currently regarded as a valuable employee and that her financial future is not without prospects. 16She owns a Harley Davidson motorcycle and a 2002 Holden Commodore. She purchased the motor vehicle 16 months ago. In an earlier affidavit she said that if she received anything from her mother's estate, she would spend it, among other things, on "a car to drive myself and the children around". Her brother said that following termination of her relationship with a man named Les Eldridge in 2008, she received a property settlement of approximately $28,000. She did not respond to, or elaborate on, that evidence and made no mention of it in any of her affidavits. Her second eldest son owns a home at Narrandera which she is now renting from him. It is a two bedroom cottage for which she pays rent of $140 a week. Her youngest son, Travis and a girlfriend also live in the home with her. The inference from the evidence is that she enjoys a healthy relationship with those two sons. There was no evidence of her other children. 17The quality of the evidence of the plaintiff's health was not entirely satisfactory either. She said that she was diagnosed with cancer in August 2009 and that she has received some radiation and chemotherapy. She also said that in April 2010 she was "required to have an operation to remove my uterus, vagina, rectum and bowel". However it became apparent during her cross-examination that this statement was exaggerated and inaccurate. She displayed no current visible signs of illness in the witness box and said she was in remission. Perhaps, significantly, there was no medical evidence; nothing to support or corroborate her testimony; no indication of her prognosis; and no explanation of the medical cost to her, if any, of the treatment she has received or might continue to receive. The closest the evidence came to any explanation of her medical expenses was a statement in one of her affidavits that she spent $20 per week on medication. This is the same amount that she said she spent on dog food. And her list of expenses excluded alcohol.

The Defendant's Circumstances 18The position of the defendant must also be considered. He is a single parent with young children. His circumstances form part of the equation by which I must determine whether the distribution of the estate effected by the testator's will failed to make adequate provision for the proper maintenance, support or advancement in life of the plaintiff . That is because the question is relative and any order in favour of the plaintiff will directly operate to the disadvantage of the defendant and cause him hardship. 19Although the defendant is better off than the plaintiff, his money and assets are relatively insubstantial. And he has the added burden of caring for his two daughters. The health of one of his daughters is severely compromised by diabetes and Celiac's disease. Until recently, the defendant resided in Canberra where he had a home and a business called 'Glenn's Brush Fences'. The business did not prosper and he sold the Canberra home. He now resides in Narrandera where he owns a house and lives with his two daughters and a female companion named Bobby Hill. His annual income from casual work is expected to be about $25,000 per annum. He does not have a mortgage and does not intend to apply for Centrelink payments. His daughters visit their mother in Gunning during the school holidays and for half of the summer vacation. Although the evidence was not clear, it was said in submissions that he receives a carer's allowance. 20The defendant's distribution from his mother's estate was $122,552 from which he paid $5,000 to his other sister Kerrie and approximately $8,000 for funeral expenses and a headstone. This left approximately $109,000. His net proceeds of sale from his Canberra home were $126,446. He purchased his current home at Narrandera for $129,000 including stamp duty and legal fees. He has spent approximately $60,000 on its repair and improvement. After payment of outstanding bequests in favour of the plaintiff's children and payment of the first instalment of his own legal fees of $6,130, the defendant has $40,868 left as a contingency fund to meet the plaintiff's claim and his own remaining legal costs. His remaining legal fees unpaid to the date of hearing were said to be $19,208. This leaves $21,660. This is consistent with the evidence and submissions on both sides that the respective legal costs of each party to the proceedings were about $25,000. 21The fund of $21,660 represents the only monies that are now readily available to the defendant to meet any award in favour of the plaintiff and any costs order in her favour. Because of the plaintiff's failure to commence proceedings within the statutory time period, and because the estate has been distributed, an order in her favour must be satisfied from the testator's notional estate. There is hardship all around.

Proceedings Out of Time 22The failure to commence proceedings within time raises a threshold issue. The plaintiff seeks an order pursuant to Section 58(2) of the Succession Act 2006 (NSW). It provides that an application for a family provision order must be made not later than 12 months after the deceased's death, unless the court otherwise orders on sufficient cause being shown. There is little, if anything, in the way of a 'sufficient cause'. Although the testator died on 16 March 2009, a notice of intention to make a claim was not filed until 9 August 2010 and the summons was not filed until 7 September 2010. Admittedly the plaintiff saw her solicitor in October 2009 but her primary purpose in doing so was to obtain advice on a divorce settlement. The evidence did not explain the divorce settlement or identify the husband concerned. Subsequently, the plaintiff took no steps to make a claim on the estate for many months. And when she did so her solicitor was unaware of the change in the law that reduced the time period for commencement of such proceedings from 18 months to 12 months after the deceased's death. 23The solicitor's oversight in this case in failing to cause proceedings to be commenced within 12 months of the date of death of the testator does not by itself qualify as a 'sufficient cause': Cetojevic v Cetojevic [2006] NSWSC 431 at [54]; Charles v Charles , (unreported, NSWSC, 25 March 1988). There must be something more than inattention by a solicitor before time can be extended. Section 58(2) reveals a clear legislative intention to limit applications for family provision orders to those made within a defined, and strictly confined, period. An application is made by filing an originating process commencing proceedings in the registry of the court: Section 58(3). 24The short time period imposed by Section 58(2) reflects the judgment of parliament that the welfare of society in connection with the administration of deceased estates is best served by imposing a strictly limited time for making applications. This is not unreasonable. In most cases the putative claimant will be well aware of the testator's death and the (allegedly) insufficient provision made for him or her. There will only occasionally be a good excuse for not making a claim within time. In fact, experience indicates that the deceased's relatives usually pay uncommonly close attention to such matters. That is not to say that cases will not arise where, for legitimate reasons, a claimant is quite unaware of the death, or of his or her legal right to make a claim, and is unable to comply with the 12 month time limitation. In those circumstances, the statutory exception requiring 'sufficient cause' may well apply. 25In this area of the law, as in some other areas, I think that it is often better policy to leave claimants to their remedies against their solicitor, rather than to undermine the purpose of the statutory provision: cf In Re Salmon [1981] Ch 167 at 176 E-H. To do otherwise would compromise the effectiveness of the legislative intention while ignoring the fault of the plaintiff's own agent against whom she has separate remedies. I do not however suggest that oversight or negligence by a plaintiff's solicitor will never constitute 'sufficient cause'. For example where the estate is already on notice within the statutory time period that the plaintiff intends to make a claim, the solicitor's failure to commence proceedings within time will not usually have caused prejudice and should not be fatal: Cetojevic v Cetojevic (supra) at [55]; Kalmar v Kalmar [2006] NSWSC 437 at [24]; In re Salmon (supra) at 174 C-E. But as a matter of general principle, and taken alone, I regard the proposition that a solicitor's oversight is a sufficient cause for the purpose of Section 58(2) as one that is open to sound rational and logical objection. 26There are other factors in this case concerning the plaintiff's delay that are relevant to the issue of 'sufficient cause'. She said she thought her brother would look after her and that it was only after she became sick that she became concerned about her financial position. I do not accept that evidence. Nor do I accept her evidence that she was unaware in August and September 2009 of the published notices calling for the receipt of any claims on the estate. Both notices appeared in the Narrandera Argus , the only newspaper in town, on the same page as 'Positions Vacant' and advertisements for the 'Movie of the Week' at the local cinema, the Roxy. I do not accept that the plaintiff was distracted by her illness or that she did not read the paper. The reality is, I think, that it did not initially occur to the plaintiff that her mother's will was unfair or that she might have a claim. And she was in a better position to know the full circumstances than the court now is. 27I should add one final note on the question of prejudice. The primary enquiry when considering whether to extend time pursuant to Section 58(2) is as to the reasons why the claimant has failed to comply with the time limit. Prejudice is not by itself the relevant touchstone but it is a factor. The statutory discretion is unfettered and no guidance is given as to its exercise. However, the fact that an estate has been distributed will often be significant. As Sir Robert Megarry VC explained in Re Salmon (supra) at 176A-D, there is a real difference between depriving beneficiaries of the prospect of receiving a benefit under the will and taking money off them which they have already received and begun to enjoy. 28In this case, there happens to be prejudice. That is because the estate has been distributed, monies have been spent and the defendant has been left in a position of having limited, indeed insufficient, readily available funds to meet the claim and the parties' costs. That is not to say that the fact of the distribution of the estate will always operate as a bar to an extension of time. In a given case, it may well not. For example, a deserving daughter living in a Buddhist monastery and out of touch with the world possibly may have a powerful case for an extension of time notwithstanding the distribution of the estate. It would be unwise however to speculate too far on the myriad facts that may arise. 29For the reasons that I have explained, I am not satisfied in this case that 'sufficient cause' has been shown for the purpose of Section 58(2). The fact that the claim is weak only fortifies my decision: Warren v McKnight [1996] NSWSC 419; (1996) 40 NSWLR 390, 394 (Hodgson J); De Winter v John Stone (unreported, NSWCA, 23 August 1995) per Sheller J. I would therefore dismiss the claim. However, in deference to the submissions on behalf of the plaintiff, I will go on to explain my reasons in relation to her substantive claim. In particular, I will explain why I have reached the view that there has not been a failure to make adequate provision for the plaintiff's proper maintenance, education or advancement in life; and why I would not in any event be prepared, in the exercise of my discretion, to interfere with the testator's freedom of testamentary disposition.

Freedom of Testamentary Disposition 30It is useful, I think, not to lose sight of the fact that freedom of testamentary disposition remains a foundational principle in our system of law. In Vigolo v Bostin (2005) 221 CLR 191, Gleeson CJ pointed out that the relevant legislation did not confer new rights of succession and did not create legal rights of inheritance. Rather, his Honour explained, 'It preserved freedom of testamentary disposition, but subjected that freedom to a new qualification': [10] Hallen AsJ expressed the same point when he said recently in Goodsell v Wellington [2011] NSWSC 1232 at [108] that: Freedom of testamentary disposition remains a prominent feature of the Australian legal system. Its significance is both practical and symbolic and should not be underestimated. 31And many years ago Sir Owen Dixon said in Pontifical Society for the Propagation of the Faith v Scales (1961-2) 107 CLR 9 at 19 that it was never intended by the legislation that 'freedom of testamentary disposition should be so encroached upon that a testator's decision expressed in his will have only a prima facie effect, the real dispositive power being vested in the Court'. 32There are sound practical reasons for not encroaching too readily on the testator's freedom of testamentary disposition and especially not in accordance with abstract concepts such as fairness or the misguided notion that there should be equality between the children of the testator. In Pontifical Society for the Propagation of the Faith v Scales (supra) at 20 Dixon CJ articulated the unique difficulty which these cases present with the following memorable apophthegm: The difficulty is that the Court itself can never be certain that it knows all the circumstances. More often than not, one may be sure that the Court knows few of them. Experience of forensic contests should confirm the truth of the common saying that one story is good until another is told, but a testator is dead and cannot tell his. 33To similar effect were some observations of Taylor J in Stott v Cook (1960) 33 ALJR 447 at 453-4, who explained that the reason why a court does not have a mandate to rework a will according to its own notions of fairness, is because such an approach would serve justice no better than: ...acceptance of the judgment of a competent testator whose knowledge of the virtues and failings of the members of his family equips him for the responsibility of disposing of his estate in far better measure than can be afforded to a Court by a few pages of affidavits sworn after his death and which only too frequently provide but an incomplete and shallow reflection of family relations and characteristics. 34Each of those statements is apposite to the facts of this case. The evidence presented at the hearing was unsatisfactory and provides only an incomplete and unconvincing picture. In truth, the testator was in a far better position than I am to appreciate the virtues and failings, and the needs, of the plaintiff. And there was no evidence or suggestion of irrationality or vindictiveness on her part. In those circumstances, and absent probative evidence in the plaintiff's favour, I should give considerable weight to the testator's judgment. It is necessary however to consider the statutory requirements.

The Statutory Requirement - Section 59 35If there is to be any interference at all with the testator's freedom of testamentary disposition, the primary jurisdictional requirement that must be satisfied is that the distribution of the estate effected by her will is not such as to make adequate provision for the proper maintenance, support, education or advancement in life of the plaintiff: Singer v Berghouse (1994) 181 CLR 201, 209-210 and 230-231; Vigolo v Bostin (supra) at [5]; Goodsell v Wellington (supra) at [109] - [115]; Section 59(1)(c), Succession Act 2006 (NSW). 36The term 'adequate', and especially the term 'proper', are value-laden concepts. They cannot always be neatly divided but in general terms the former is concerned with quantum while the latter directs attention to what is appropriate in all of the circumstances. What is proper is necessarily a relative concept whose underlying principle is often conveniently described as turning on whether a wise and just testator, aware of all the circumstances, would have thought it his or her moral duty to do more: Vigolo v Bostin (supra) at [15] - [22]; Bosch v Perpetual Trustee Co (Ltd) [1938] AC 463 at 479; Goodsell v Wellington (supra) at [56] - [72]. I hasten to add that the notion of 'moral duty' is only a gloss, albeit a helpful gloss, on the statute. Ultimately, the question must be answered by reference to the text: Coates v National Trustees Executors & Agency Co Ltd (1956) 95 CLR 494 at 523 (Fullagar J). 37It is obvious that the determination of what is adequate provision for the plaintiff's proper maintenance, support and advancement in life requires consideration of the relativities. It also involves an evaluative judgment having regard to the plaintiff's station in life and the standard of living which she is entitled to expect. In this particular case, I leave out of consideration the question of the plaintiff's 'education'. And provision for her 'maintenance' does not seem apposite in the circumstances. She is an adult mother of four adult children and the claim put on her behalf is modest. And the estate was small. The question is really whether adequate provision has been made for the plaintiff's proper 'advancement' in life. 38Shortly before the hearing, the plaintiff's solicitor said she would accept $40,000. Even if I were inclined to make an order in that amount - which I am not - such an amount would not, in my view, be sufficient to make any practical difference to the plaintiff's advancement in life. It may well have the opposite effect. I would be apprehensive that the monies would be spent unwisely and that the effect of the order would not produce any appreciable advancement in her life other than in a short-lived and ephemeral sense. The testator clearly thought the same. She did not think it appropriate to entrust any of her limited monies to the plaintiff, even monies for the benefit of her four children. 39In circumstances where the resources of the estate are extremely limited, I cannot see how it would be 'proper' to make an award which causes hardship to others while not providing such a benefit to the plaintiff that I can be confident it will be in her best interests; that it would in any meaningful sense contribute to her advancement in life. The testator's knowledge of the failings of the plaintiff is, in this case, likely to be a better measure of what is proper: Stott v Cook (supra) at 453-4. I have concluded that, in all of the circumstances, it was not necessary for the testator to make any provision in her will for the plaintiff's proper maintenance, support or advancement in life. In any event, there are a number of discretionary factors that weigh against the making of a family provision order in favour of the plaintiff: Section 60(1)(b).

Discretionary Factors 40Whichever way I go, the outcome will produce a burden. I have already explained that, as well as being small, the estate has already been administered and the defendant only has a limited contingency fund. And the amount of the fund is less than the costs of both parties to the proceedings, let alone sufficient to meet an award in favour of the plaintiff. One of the other factors that has influenced the exercise of my discretion is the plaintiff's delay. I have set out my findings of fact on that issue in paragraphs [22], [26] and [28] above. 41Another factor relates to the conduct of the proceedings. The plaintiff has failed to behave reasonably. Neither she nor her legal representatives appear to have been prepared to recognise any weakness in her case. They appear to have been unwilling to brook almost any compromise. This is notwithstanding that the circumstances of the case necessarily required responsible consideration of a reasonable compromise. In September 2011 before substantial costs had been incurred the plaintiff refused to accept an offer of $30,000. The result has been that the proceedings have run to their conclusion, almost exhausting the defendant's readily available funds, and making it more difficult for the court to arrive at a just result. 42In my view conduct of this nature may, in a given case, fall under the rubric of paragraph (p) of Section 60(2). It is 'any other matter' that I, for my part, consider relevant. The nature of the decision that a court is required to make on an application for a family provision order necessarily involves the broadest discretionary considerations. Among other things, the plaintiff's unreasonable conduct of the proceedings in this case has substantially diminished the funds that are readily available to meet her claim. It is, in my view, relevant to whether I should make an order in her favour. 43A third factor is the plaintiff's character and conduct. I will not repeat the evidence on this issue. I have already set out my findings of fact in paragraphs [4] - [12] above. There is sufficient justification on those findings for exercising my discretion against the plaintiff. Her conduct was, in my view, relevant to the purposes which the Act is intended to serve: In Re Gilbert (1946) SR (NSW) 318 at 321; Hastings v Hastings [2008] NSWSC 1310 at [31] - [43].

Conclusion & Orders 44For those reasons, I have concluded that the claim should be dismissed: (a)I am not satisfied that 'sufficient cause' for the purpose of Section 58(2) has been established; (b)I am not satisfied that the plaintiff meets the jurisdictional requirement specified in Section 59(1)(c), namely that she be a person for whom adequate provision for her proper maintenance, education or advancement in life has not been made by the testator's will; and (c)I am satisfied that consideration of the evidence relevant to the matters specified in Section 60(2)(a), (c), (d), (g), (i), (j), (m) and (p) justifies me, in any event, in determining that a family provision order should not be made in the plaintiff's favour as a matter of discretion. 45The only concession to the plaintiff that I am prepared to make is that I will order each party to pay his and her own costs. The plaintiff's solicitors may wish to consider their responsibility for the failure to commence proceedings within time. And the defendant may wish to consider a modest ex gratia payment to the plaintiff. There is, of course, no legal obligation to do so. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 16 March 2012