Mulhall v Permanent Trustee

5844/02 - MARIA ANTOINETTE MULHALL v PERMANENT TRUSTEE CO LIMITED - ESTATE OF JAMES WILLIAM COURTNEY

1 MASTER: This is an application under the Family Provision Act in respect of the estate of the late James William Courtney who died on 24 April 2002 aged eighty-two years. He is survived by the plaintiff, his daughter, and Patricia Henrietta Hurman, a lady with whom the deceased had a relationship for a period of about forty-two years. The will of the deceased 2 The last will of the deceased was made on 22 October 1996. That provided for the whole of his estate to go to Ms Hurman whom he described as a long term friend and lover. He appointed the Permanent Trustee as executor. 3 He also at the same time executed a Statement of Reasons which was addressed to the Permanent Trustee in the following terms: "I have appointed your company as executor in my will.

In my will I have bequeathed my estate to my dear companion and lover of approximately thirty-five years, Patricia Henrietta Hurman.

Prior to my relationship with Pat Hurman, I was briefly married for about 3-4 years during the early 1940s. I was divorced during or about 1946.

During my marriage, one female child was born in 1941, Antoinette Maria Courtney. Following the separation from my former wife, I attempted to provide some care for my child, however, because the nature of the relationship with my former spouse, all contact with the child ceased in 1948. In 1967, a property settlement with my former wife was reached.

I have had no contact whatsoever with the child of my former marriage. There has been no attempt by her to contact me, nor has there been any attempt by me. I do not know of her whereabouts or her circumstances, except to say that the settlement of property in 1967 should have adequately maintained her and given her a good start to life.

For the past thirty-five years or more, Patricia Hurman has cared for me, loved me, comforted me and continues to do so.

J W Courtney." Assets in the estate 4 The present assets in the estate consist of cash amounting to $563,415.37. The balance of the defendant's costs amounted to $14,524 and the trustee's commission of $4757.50 have to be deducted. That leaves an estate of $544,137.87. The plaintiff's costs incurred to date are $39,000. Family history 5 I will deal with a little of the family history. The deceased was born on 2 October 1909 and he married Marguarita Lily McCarthy on 26 October 1940. The plaintiff, their only daughter, was born on 25 May 1941. In March 1946 the deceased and his wife purchased a property in Beattie Street, Balmain and that was also a time when the marriage between the deceased and his wife broke up. Apparently, according to the witnesses in the case, the deceased came home to find his wife in bed with another man. That event seemed to have a very lasting impact on the deceased. He took his daughter away who was aged five for two weeks and when he came back his wife had gone, not surprisingly. 6 According to the reasons which I have referred to above, the deceased said the last contact he had with the plaintiff was in 1948. According to Leonard Fairfield, a friend, there is evidence that the plaintiff still visited the deceased in the early 1950s and it was in 1958 when the plaintiff left school that she says contact ceased until a time in 1977. There is the possibility of one phone call between them in that period some time after the plaintiff married. 7 It was in 1960 that Ms Hurman met the deceased. In March 1963 the deceased and his wife were divorced and there was a property settlement in 1967. 8 The plaintiff married on 12 September 1964 and her first child Diana was born in 1969 and a son Michael was born in 1976. By 1976 the deceased had retired and he made a will in which he left all of his estate to Ms Hurman. It was in 1977 that contact resumed between the plaintiff and the deceased. She called in to see him one day at his home on the off chance of seeing him and thereafter visited every six to eighteen months throughout the 1980s. 9 In 1986 Ms Hurman's father died and she inherited the family home. She had lived in that home all her life and continued to do so and in fact still lives there. 10 In circumstances to which I will come later, the plaintiff's contact with the deceased decreased in 1990 until about 1998. It was in 1996 that the deceased first disclosed to his then long time friend that in fact he had a daughter. The plaintiff's husband died in June 1996 and in the same year the deceased sold his home at auction. The proceeds were kept by him and he went into a retirement village. He did not stay with Ms Hurman because of his health. By chance, the plaintiff was passing at the time of the auction and she went in to try and find out her father's address but it took another two years until she eventually traced her father. 11 The will in question was made on 22 October 1996 and I have already referred to it. In 1998 the plaintiff located her father again and saw him some four times between then and 2001. The deceased died in April 2002 and probate was granted to the defendant. The summons was issued within time and the plaintiff's mother died in July 2003. Eligibility 12 Clearly enough the plaintiff is an eligible person within the meaning of that expression. 13 In applications under the Family Provision Act the High Court in Singer v Berghouse (1994) 181 CLR 201 has set out the two stage approach that a court must take. At p 209 is 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 or 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." 14 I turn to consider the situation of the plaintiff. The plaintiff is sixty-three years of age, single and has no dependants. She owns her own home at 14 Thomas Street, Parramatta, for which she paid $270,000 in 1997. She has a 1996 Hyundi XL, no savings and no liabilities. Her income from the pension amounts to $443 per fortnight and her expenses are $501 per fortnight. This leaves her with a shortfall of $58 per fortnight and her expenses take no account of doctors, dentists, holidays or luxuries such as wine, dry cleaning and shoe repairs. Clearly she would like some increase to relieve what is a very frugal existence. The plaintiff obviously did not contribute to the estate of the deceased which came from the sale of his house. 15 It is necessary to look at the way in which the plaintiff says that she has been left without adequate and proper provision for her maintenance, education and advancement in life. She advances the following matters: 16 1. A sum to supplement her income shortfall of $58 per fortnight and other expenses. The sum necessary to produce $100 per week until her death would be, on the discount tables, $86,000. Although the shortfall is obvious, she also refers to the fact that she would like something more to cover those items which I have referred to which would at least make her life not so frugal. 17 2. She referred to the sum of $23,500 to purchase a new car to replace her existing car. Given the age of her present car some replacement will be necessary but probably not immediately. 18 3. She asked for the sum of $3935 to carry out dental work. Her evidence is she needs dental work estimated by her dentist in that amount. The alternative would be to remove all her teeth and have dentures. 19 4. She would like to have a trip overseas at a cost of $10,209. This may be something of a luxury. 20 5. She also says she would like to replace furniture and household items to the extent of $11,470. There does not seem to me to be any evidence that the existing items are in disrepair and it seems more likely a desire to replace older items for new. 21 6. She listed a number of repairs she would like to do to the house but the costing was not admitted in evidence. There seems to be some evidence they are necessary, as far as the plaintiff is concerned, and items such as painting will incur some reasonable expense. Others having a claim on the deceased's bounty 22 It is also necessary to consider the situation of others who claim on the bounty of the deceased. In this case the only one is Ms Hurman. She is seventy-nine years of age, single, has no dependants and apart from blood pressure problems she is in good health. She owns her house at 24 Janet Street, Five Dock, which is unencumbered. She has a bank account of some $4000, furniture worth $3000 and a 1997 Corolla car worth $14,000. She receives a pension income of $212.70 per week and her outgoings are $177.21 per week. She apparently has adequate income. She says she needs to do repairs to her seventy year old home but the cost was not admitted into evidence. She also wishes to travel both overseas and within Australia. She has no particular plans to travel with others overseas and accordingly that possibility is perhaps somewhat unlikely, given her age. 23 Ms Hurman had a long relationship with the deceased. She was a thirty-five year old spinster and he fifty-one years old when they met. They in fact never lived together but it is clear they had a loving, sexual relationship together. In the ordinary course, Ms Hurman would return home each day to cook her parents' meals and then would return to the deceased's home where she would cook him a meal and they would spend the evening together. The deceased and Ms Hurman travelled overseas and generally around Australia together and clearly on those occasions they were a couple. There is no doubt it was a close and loving relationship that was beneficial to both of them. Consideration of the plaintiff's relationship with the deceased 24 Given the size of the estate and the fact that both ladies own their own homes unencumbered, there does not seem to be any competition for the available estate. Instead, the question is what is appropriate having regard to the very limited contact between the deceased and his daughter over their lifetimes. The defendant submitted that no order should be made having regard to the very limited contact. 25 Section 7 of the Family Provision Act provides that if a court is satisfied that a person is an eligible person: "it may order that such provision be made out of the estate or notional estate, or both, of the deceased person as, in the opinion of the court, ought, having regard to the circumstances at the time the order is made to be made for the maintenance, education or advancement in life of the eligible person". 26 In Benney v. Jones (1991) 23 NSWLR 559 at 568-9, Priestley JA noted as follows: "This conclusion directly raises the question of whether the word 'ought' in s 7 of the Act carries with it an idea of moral obligation. In answering this question some guidance may be obtained from authoritative decisions under the Testator's Family Maintenance and Guardianship of Infants Act 1916 (as amended), using due care to take account of the differences between the two Acts. ...It seems plain from the comparison of the two Acts, and particularly from s 3 of the 1916 Act and s 7 and s 9 of the present Act, that language from the earlier Act has been deliberately carried into the later one. It would seem that at least one purpose of this retention of much litigated sets of words is that the benefit of the authorities on those words may be available in the construction of the present Act. The same reasoning supports the view that where the new Act uses a different word in an important operative section from the word in the corresponding section of the earlier Act, the difference is deliberate and has a purpose. The Act draws a distinction between the eligible persons referred to in par (a) and par (b) on the one hand and par (c) and par (d) on the other. Broadly speaking, the distinction can be seen as one between classes of people who, in the ordinary course of family life would, prima facie, be persons to whom the deceased person spoken of in s 3 of the 1916 Act and s 7 of the present Act would have an obligation to make provision, whereas those in the other class would, prima facie, not be regarded in the ordinary course of family life as being likely to be made the subject of provision by the deceased. In regard to the first class, the more usual approach under the 1916 Act was that before making an order, the court needed to be satisfied that the testator ought to have made provision for the applicant, in all the circumstances of the case: see Bosch v Perpetual Trustee Co Ltd [1938] AC 463 at 478-479 and Hughes v National Trustees Executors and Agency Co of Australasia Ltd (1979) 143 CLR 134 at 146-147 per Gibbs J, with whom Mason and Aickin JJ both agreed. However, there was a differing view, expressed by Murphy J, in the same case when, after commenting (at 158) that 'many cases suggest that an applicant must show a moral claim ...', he went on to say that this was a gloss on the Act and was unwarranted and inconsistent with the language of the legislative scheme. It seems to me that the introduction into s 7 of the present Act of the word 'ought' in replacement of the words from s 3 of the 1916 Act 'as the Court thinks fit' shows the intention of the present Act to accept the approach adopted by the majority in Hughes and to reject that of Murphy J. The word 'ought' seems to be deliberately adopted, in the present Act, from what Gibbs J called the classical statement in Bosch . To my mind, this is a very clear indication that an eligible person with par (c) and par (d) must show a moral claim on the estate before an order can be made; I also think this is the same thing as saying that the deceased person must have had a moral obligation to that eligible person. It is hard to imagine how the one could exist without the other. It seems to me that the same reasoning is very probably applicable to applications by eligible persons within par (a) and par (b) although it is unnecessary to decide that in this case." 27 Meagher JA (NSWLR at 570) agreed with Priestley JA. Meagher JA had previously expressed a view in Hughes v Hughes Court of Appeal unreported 6 June 1989 (an adult daughter case) that the duty arose to make provision as established in that case as follows: "Her right arises not merely from the bare fact of parenthood, which of itself does not generate a right , but from the general circumstances of the case; namely, parenthood, the performance of normal filial duties in the 10 years after she left school and in the two periods between her earlier trips and in her professed and continued willingness to be of whatever assistance to her father she could be." (Emphasis added.) 28 Hope and Samuels JJA concurred in the judgment of Meagher JA in Hughes v Hughes. 29 In Benney v Jones, Mahoney JA at 560 said: "Whether an order should be made raises (as it has been described) the oral or normative question. That question remains, whether the application is made under the former or the present Act. The nature of that question was discussed in this Court and in the High Court in White v Barron (1980) 144 CLR 431; and in Goodman v Windeyer (1980) 44 CLR 490: see, also, Kearns v Ellis (Court of Appeal 5 December 1984 unreported) and Gorton v Parks (1989) 17 NSWLR 1. 'Where the applicant is a member of the deceased's family, as referred to in the earlier paragraphs of s 6(1) relating to eligible persons, the nature of the duty which the deceased should have fulfilled is reasonably clear.'" 30 In Gorton v Parks (1989) 17 NSWLR 1 at 7ff, Bryson J analysed the relevant authorities dealing with claims by able-bodied adult males. For present purposes, there is no reason to distinguish able-bodied adult females. In the course of doing so, his Honour noted: "It is then established by authority that no special principle is to be applied, and it seems important to warn myself against allowing prima facie views or the success of some applicants who have special claims to disturb the perception that there is no special principle. In particular, an idea that an able-bodied adult male who is earning a living could have no claim in relation to resources of any size is quite erroneous and must not be entertained either prima facie or at any stage. It is a discarded categorisation". 31 Bryson J also rationalised the decision of Pontifical Society for the Propagation of the Faith v Scales (Scales Case) (1962) 107 CLR 9. Scales' case was a claim by an adult son, who was unsuccessful, and where Dixon CJ said (at 18): "The outstanding fact of the case is that, throughout the period of their joint lives, the son disregarded the father and the father disregarded the son and after a time expressly disowned him. ... In truth there is the bare fact of paternity and no other mutual relation: the case depends upon the face and basically upon nothing else except all the arguments of right and wrong that may be considered to spring from that source and affect the situation of the parties as it existed at the testator's death". 32 At 17 NSWLR 1 at 9-10, Bryson J sought to distinguish Scales case. He said: "Dixon CJ did not expound the weight which he gave to the bare fact of paternity and nothing else; I regard that bare fact as of very great importance in morality. The idea that the moral obligations arising from paternity are diminished or do not exist if the parent withholds acknowledgment of the obligations or of the child appears to me to be an idea from a distant age. There have been changes over long periods in the beliefs of the community about moral duty to children, and there seems in the distant past to have been some acceptance of a view that unless children were legitimate or were acknowledged by their father, he has no moral duty towards them. There seem to have been legal systems in the past in which attempts to provide for illegitimate children by will were ineffective; ... Under modern legislation parental duties are not distinguished according to acknowledgment or legitimacy. The idea that acknowledgment by a parent of a child or full accordance of status by a parent might increase the responsibilities of a parent or be significant to moral duty towards the child, with the contrary implications, seems a very strange idea and it is curious to find it, even in a limited way, in a judgment published as recently as 1962". 33 Byron J, in any event, distinguished Scales' case (p 11) on the basis that on the facts before him the plaintiffs: "In their childhood years they lived in the same street in which their father lived in far greater prosperity a few doors away: they saw him and he saw them from time to time, and they had a relationship with him in which negative aspects preponderated greatly or almost exclusively over any positive aspects of the familial relations. A mutual relation there was. Each of them had a relationship with the testator which the testator brought to an end; in the case of Mrs Joan Adams and Mr John Culcott, he saw something of them and made an inadequate contribution to their maintenance in their childhood, but in effect abandoned the relationship before they reached mature years and at a time when they cannot fairly be held responsible for ending the relationship. They were present before his eyes in their childhood and years of education and trade training; he knew who they were, he must have had an idea of what they were doing, and he did not make even token attempts to assist them in any way. ..." 34 In Walker v Walker (unreported 17 May 1996) Young J reviewed the question of moral duty. His Honour reviewed Gorton's case, in the context of the earlier High Court and House of Lords decisions, noting the effect of Singer v Berghouse (1994) 184 CLR 201 as follows: "In Singer's case, a widow who had been married less than one year to a 68 year old man failed in her application under this Act in this court, in the Court of Appeal and in the High Court. The majority of the court said at page 208 and following that to assess a claim under the present Act there is a two stage process. The first stage is to determine whether an applicant has been left without adequate provision and the second stage is to determine what provision ought to have been made. At p209 the judges point out that Re Allen has guided past courts and has three times been approved by the Privy Council or High Court, but that 'we doubt this statement provides useful assistance in elucidating the statutory provisions. Indeed, references to "moral duty" or "moral obligation" may well be understood as amounting to a gloss on the statutory language.' They say '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 the deceased, and the relationship between the deceased and other persons who have legitimate claims upon his or her bounty". 35 Young J also observed: "In Fraser's case, Kirby P at p 29 said that 'I do not consider that it would be safe for this court, or other courts in this State, to disregard the obiter dicta in Singer v Berghouse concerning 'moral duty'. However, his Honour's decision made it quite clear that he thought that references to moral duty in the judgment under appeal really amounted to little more than a shorthand expression for the lengthier statutory provisions actually used in the Act. His Honour made it clear that there was no drastic change in the law 'either by the observations of the majority in Singer or by the High Court's reference, in the footnote, to what Murphy J said earlier (p 27)'. 36 Handley JA thought that the dicta in the High Court in Singer should not be followed and pointed out that even as late as 1994 in Neil v Nott (1994) 68 ALJR 509, the High Court was itself using the words 'moral claim' in decisions under this Act. 37 Sheller JA again did not consider that the High Court's suggested abandonment of concepts of moral claim or moral obligation changed the task of the court. He said, with reference to decision of Murphy J at p 42, 'the point in the judgments to which Murphy J referred was that the existence of a moral obligation owed by the deceased to the claimant was a necessary part of the claimant's case but not alone sufficient to justify an order in the claimant's favour. Thus, in theory an order would not be made out of the estate of a deceased parent in favour of a child who had over many years completely cut himself or herself off from the parent, even though the child was left in need. On the other hand, a wealthy child who had cared for the parent throughout his or her life may have no claim for further provision under the legislation. The courts, in giving effect to the legislative scheme, having accepted that the bare moral claims of the sort mentioned by Stout CJ in Re Allardice (1910) 29 NSWLR 959, 970 will not alone suffice to empower the court to make an order". 38 In Walker v Walker (p 27) Young J noted: "It is often impossible to work out whether the degree of separation between parent and child at the date of the parent's death is solely the fault of either or whether it has come about by factors too strong for either to control or somewhere in between. The important matter is not fault, but whether in all the circumstances it would be expected by the community that the testator would have to make a further benefaction than he in fact did to constitute proper or adequate provision for the plaintiff. Accordingly, I reject the approach that all an applicant under this Act has to do is to prove that he or she is an eligible person and that he or she reasonably needs more financial assistance. The cases show that there must be a full investigation into all the facts and circumstances of the matter to see whether the community would expect that a person in the plight of this testator ought to have made provision or further provision for the applicant. ..." 39 It seems to me that the formulation of his Honour Young J is sufficient and appropriate to guide me in determining these matters. There is no doubt that the deceased was greatly hurt by his wife's infidelity as he mentioned it to a number of people over the years. It also appears he harboured some suspicions as to whether he was the father of the plaintiff. These, on the evidence before me, are quite unfounded. The incident recounted by the deceased occurred in 1946 and the plaintiff was born in 1941. 40 The statement by the deceased in 1996 as to the extent of contact with the plaintiff is contradicted by the evidence of Mr Fairfield who talks about taking the plaintiff in to see the deceased in town in the early 1950s. The plaintiff was then at school and apparently the deceased provided her, on her request, with a tennis racquet, the only thing he appears to have given his daughter. Accordingly, little reliance can be placed on the deceased's statement and that tends to make the plaintiff's version of the extent of contact more likely. The evidence makes it perfectly plain the deceased never tried to contact the plaintiff in person, by phone or by letter but that it was the other way around. 41 The plaintiff gave oral evidence that she felt the deceased was always distant to her and rejected her attempts at establishing a relationship. Having regard to the unfounded statements doubting the legitimacy of the plaintiff made by the deceased, this is quite likely to have happened. It is also notable that the deceased did not tell Ms Hurman, his closest friend, until 1996 of the existence of his daughter. He only did so then because friends threatened to tell her. 42 The plaintiff gave evidence of an occasion when she had a conversation with the deceased about her future career just before she left school. In that conversation the deceased was very discouraging towards her. Sending her off to start her adult life in that way was effectively a rejection of her and anything that she might do in the future. 43 The next contact was in 1977 when the plaintiff made a spur of the moment decision to call in and see the deceased. Contact continued on a regular basis until 1990 when the plaintiff effectively gave up trying to establish any rapport with the deceased. According to her he was distant and not really interested. 44 It is clear that the plaintiff went through the early part of her adult life, marrying and having two children without in any way trying to involve the deceased in her life. It was, however, the plaintiff who re-established contact in 1977. 45 When one stands back and looks at it, it seems to me that the deceased rejected contact from his daughter for unfounded reasons and the plaintiff, justifiably, did not involve him in her life. It is not, in my view, a situation where the plaintiff abandoned her father without just cause. The unfortunate thing is that the plaintiff and the deceased were deprived of that filial contact which can be so rewarding to both. In the circumstances, it is appropriate to make provision for the plaintiff. 46 She clearly has a need to supplement her income. That income will not be affected by the receipt of funds unless they exceed $149,500. Once this is exceeded the amount of the pension reduces by $3 per fortnight for every $1000 of assets above that sum. It then reduces to zero at about $304,233. She has some other present needs for expenditure on furniture, dentures, car replacement and unquantified repairs to her home. No doubt, any funds awarded would be spent on those matters. 47 In the circumstances I think it appropriate that the plaintiff receive a legacy of $180,000. Orders 48 The orders I make are as follows:

1. The plaintiff is to receive a legacy out of the estate of the deceased in the sum of $180,000. 2. Interest is to run at the rate provided for under the Wills Probate and Administration Act within one month from today's date. 3. The plaintiff's costs on a party and party basis and the defendant's costs on an indemnity basis can be paid or retained out of the estate of the deceased. 4. I order that the exhibits be returned.

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