Nedljkovic v Orozovic

PARTIES : Leposova Nedljkovic v Sreten Orozovic (Estate of Dusan Paripovic)

Mr M. Heath for plaintiff COUNSEL : Mr B. Ralston for defendant

Konstan Lawyers for plaintiff SOLICITORS : Robert D West & Associates for defendant

• 1 - THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

4684/04 - LEPOSOVA NEDLJKOVIC v SRETEN OROZOVIC - ESTATE OF DUSAN PARIPOVIC

1 HIS HONOUR: This is an application under the Family Provision Act in respect of the estate of the late Dusan Paripovic who died on 5 December 2003 aged sixty-eight years. He was never married and did not have children. He was survived by the plaintiff, who had lived in his house for some thirty years, and was also survived by a number of relatives. THE WILL OF THE DECEASED 2 Under the will of the deceased, the deceased appointed the defendant as executor. He was a long-time friend. The deceased gave legacies to a number of people. There was a legacy of $20,000 to Jenny Orozovic, the daughter of the defendant and the God daughter of the deceased. He gave a legacy of $20,000 to Gordana Tulum, described as a niece of the deceased. He gave the plaintiff a legacy of $25,000 and the residue he gave to his sister, Sabic Paripovic, and her daughter, Gordana Yuma. They, apparently, live in Yugoslavia. The defendant was entitled to commission of five per cent of the residue of the estate. ASSETS 3 The assets in the estate consisted of the following:

1. 28 Bambridge Street, Chester Hill valued at $450,000. That was the house which the plaintiff still keeps. 2. Vacant land being 54 Fourth Avenue, Katoomba worth $180,000. 3. Four blocks of land at Sanctuary Point valued at $800,000. 4. A car worth $250. 5. Cash in the sum of $12,000. 4 The cash was used as funeral expenses of $11,600. Costs have been incurred on the plaintiff's part of some $58,693 and the defendant's costs are estimated at $36,500. FAMILY HISTORY 5 The plaintiff was born on 8 February 1929 in Yugoslavia and the deceased was also born there in 1935. The plaintiff left school in 1940 to work on the family farm and she married in 1946. She had two daughters, Milica, born in 1949, and Milovina, born in 1953. She separated from her husband in 1955. 6 In 1960 the deceased migrated to Australia. In 1969 the defendant also migrated to Australia. 7 In 1972 the plaintiff migrated to Australia with her two daughters and she started work as a process worker. She met the deceased in 1973, both of them apparently being engaged in work as process workers. 8 Towards the end of that year she and her two daughters moved to live at the deceased's premises at 28 Bambridge Street, Chester Hill. The daughters remained there for a while. Milica married in 1974 and then moved out of the property. Milovina remained until 1975 when she returned to Croatia to marry. She then returned back to Australia with her husband and lived there in the house for some months while she and her husband built their own house. 9 At this time both the plaintiff and the deceased gave a guarantee to Milovina and her husband so they could borrow money to build the house which they were constructing. 10 In 1977 the plaintiff sustained an injury to her right thumb and had to cease work. In 1979 she received a worker's compensation payout of a sum of $3000. 11 In 1980 there was some discussion between the deceased and the defendant as to the relationship between the deceased and the plaintiff, and I will come back to this later in these reasons. In 1986 the deceased was injured at work when he was crushed by a truck. He did not work for some five years while he received worker's compensation payments and ultimately a pension. 12 His will, as I have said, was made on 8 September 1992. In May 1998 he gave power of attorney in favour of the defendant. He also in that year travelled to Yugoslavia for approximately six months. He did not take the plaintiff with him. This could have been for a number of reasons. He in fact went to Yugoslavia because his mother and also I think his sister were quite ill and he needed to visit them. It was a dangerous time because of the war and this may well have been the reason why the plaintiff did not proceed to Yugoslavia with him. 13 On 26 February 2001 the deceased and the plaintiff purchased adjoining grave plots at Riverwood Cemetery. As I have said, the deceased died on 5 September 2003. The summons was filed in time on 24 August 2004. ELIGIBILITY 14 The plaintiff claims to be an eligible person, as the de facto partner of the deceased. In the event that the Court does not accept that, she claims alternatively that she was in a close personal relationship, or that she was part of the household and dependent upon the deceased. 15 Under the amendments introduced by the Property Relationships Amendment Act 1999, which took effect on 28 June 1999, there was an extension of the Act which applied to proceedings which commenced after that date. The amended Family Provision Act incorporates the definition of a domestic relationship in the Property (Relationships) Act 1984. 16 That Act applies to domestic relationships which are defined in s 5 as follows: "5. Domestic relationships

(1) For the purposes of this Act, a domestic relationship is:

(b) a close personal relationship (other than a marriage or a de facto relationship) between two adult persons, whether or not elated by family, who are living together, one or each of whom provides the other with domestic support and personal care.

(2) For the purposes of subsection (1)(b), a close personal relationship is taken not to exist between two persons where one of them provides the other with domestic support and personal care:

(b) on behalf of another person or an organisation (including a government or government agency, a body corporate or a charitable or benevolent organisation.)"

(4) Except as provided by section 6, a reference in this Act to a party to a domestic relationship includes a reference to a person who, whether before or after the commencement of this subsection, was a party to such a relationship." 17 It can be seen from the terms of s 5(1) that a domestic relationship can be either a de facto relationship or a close personal relationship. 18 The definition of de facto relationship itself appears in s 4 and is in the following terms: "4. De facto relationships

(1) For the purposes of this Act, a de facto relationship is a relationship between two adult persons:

(b) who are not married to one another or related by family.

(2) In determining whether two persons are in a de facto relationship, all the circumstances of the relationship are to be taken into account, including such of the following matters as may be relevant in a particular case:

(d) the degree of financial dependence of inter-dependence, and any arrangements for financial support between the parties,

(e) the ownership, use and acquisition of property,

(f) the degree of mutual commitment to a shared life,

(i) the reputation and public aspects of the relationship.

(3) No finding in respect of any of the matters mentioned in subsection (2)(a)-(i), or in respect of any combination of them, is to be regarded as necessary for the existence of a de facto relationship, and a court determining whether such a relationship exists is entitled to have regard to such matters, and to attach such weight to any matter, as may seem appropriate to the Court in the circumstances of the case.

(4) Except as provided by section 6, a reference in this Act to a party to a de facto relationship includes a reference to a person who, whether before or after the commencement of this subsection, was a party to such a relationship." 19 This definition, apart from the provisions of sub-cl (1) merely reflects the existing state of the law as it had been developed under the De Facto Relationships Act 1984 and the Family Provision Act 1982. See Light v Anderson (1992) DFC 95120 applying Simonis v Perpetual Trustee Co Ltd (1990) 21 NSWLR 677. 20 Apart from the exclusionary matters in s 5(2) there is no definition of "close personal relationship". Little help is obtained from the reading speeches as to the meaning of "close personal relationship". It is apparent from the terms of the separation definition of de facto relationship that a close personal relationship does not necessarily involve the concept of living together as a couple. Instead, s 5(1)(b) refers to person "who are living together, one or each of whom provides the other with domestic support and personal care." It is notable that both domestic support and personal care must be provided. One of them alone would not be sufficient. The "close personal relationship" has to be between two adult persons who are "living together". Given that they may be members of the same family, such as a grandparent and grandchild, and the different definition for a "de facto" relationship concepts relating to a "couple" are not relevant. Instead, the definition calls for two different links. The first is that the parties are "living together". The second is that "one or each of whom provides the other with domestic support and personal care." 21 So far as the first requirement is concerned, since one is not concerned with concepts applicable to couples, the requirement would be met if the parties shared accommodation together. For example, a boarder in an elderly widow's home would qualify. It may not be necessary for there to be a sharing of food or eating arrangements together. 22 The second requirement is cumulative. There must be both domestic support and personal care. 23 It is the provision of "personal care" which provides the clue to the meaning of the composite expression "domestic support and personal care". Some of the primary meanings of "personal" include: (a) of or pertaining to concerning of affecting the individual person or self; individual; private; one's own; (b) of or pertaining to one's person body or figure; bodily; 24 Accordingly, personal care connotes care taken in connection with such matters. It could be provided by: (a) the person concerned; (b) an employed valet or lady in waiting; (c) a mother for her sick child, or (d) a daughter for her elderly incapacitated mother. 25 The legislation in terms excludes the first two but would include the last two examples. 26 In the present case there is no evidence which would suggest there was any personal care in the sense I have mentioned by either party. I would not have thought matters such as emotional support would, by themselves, have fallen within the composite expression. The expression seems to be directed to a different level of reality such as assistance with mobility, personal hygiene and physical comfort. Such activities obviously, however, will include an element of emotional support. 27 Absent such evidence, I will deal with the question of whether the parties lived in a de facto relationship by reference to the matters, inter alia, in s 4(2). DURATION OF THE RELATIONSHIP 28 This was from 1973 until the death of the deceased on 5 September 2003. THE NATURE AND EXTENT OF THE COMMON RESIDENCE 29 This area is often one where there are divergences in the evidence which appears in cases such as this. The house in question has four bedrooms. The main is at the front of the house. The evidence shows it has a double bed, two cupboards and two bedside tables. There is another room at the back of the house and two others, one of which appears to be used as a storeroom. The plaintiff says they both occupied the front room except for periods when the deceased was unwell. Sometimes also he snored. On such occasions the plaintiff concedes she stayed in what she called the back room. 30 In the early years each of the plaintiff's daughters, who gave evidence, lived at the house for some years. They were aged twenty-four and nineteen when they first moved into the premises and are in a good position to see and remember what occurred in those years. They corroborated what the plaintiff had said about the living arrangements and the sharing of the bedroom. 31 There is evidence by the defendant, who is an old family friend and who knew the deceased from Yugoslavia and from his early days in Australia. On one occasion he says that he was invited into the bedroom by the deceased to show him a picture. He opened the wardrobe and says he only saw male clothing in the wardrobe. He also says he noticed in another bedroom there was female clothing and there were pictures of the plaintiff's children in that bedroom. 32 It has to be appreciated that sometimes one finds different things presented by a couple who are in a de facto relationship to different people. I also mention that there was a discussion between the defendant and the deceased as to what the deceased's relationship was with the plaintiff. This occurred in 1980 during a car trip to Katoomba to show the Katoomba block of land to them. The plaintiff was not present. The conversation was as follows: "The defendant said, 'What is going on with you and Lepa'. Dusan said: 'We've signed an agreement. She does the cooking and washing and she stays at my house. That way she can get the single pension and rental allowance.'" 33 There was also evidence by the defendant's son who visited the home for a few days at a time every few months in 1988-1989. He was asked into the front room once and did not see any female clothing but he did notice such clothing in the back bedroom, as well as pictures of the plaintiff's children and a telephone. 34 The matter has to be considered along with matters relating to whether there was a sexual relationship. The plaintiff alleges there was a sexual relationship. There was also evidence of conversations the plaintiff and the deceased had with a friend about their sex life. 35 Photographs which have been tendered - and there are quite a number of them in this case - show them sitting together and touching as only a couple would. 36 In the circumstances, I am satisfied that the plaintiff and the deceased had a sexual relationship and that they used the front bedroom as their main bedroom. No doubt there were occasions when, for whatever reason, whether it be to present a face to some other person outside the family, they did not share the main bedroom. This perhaps explains in part the other evidence. FINANCIAL INTERDEPENDENCE 37 It is plain that the deceased provided money to the plaintiff to support her. She had the use of the property. All the property was purchased by the deceased. The plaintiff made no contribution to this property, apart from assisting with the clearing up of various vacant blocks of land from time to time. THE DEGREE OF MUTUAL AGREEMENT AND SUPPORT 38 Neither had any relationship with another person throughout the thirty-year period they lived together. Even the defendant and his son agree that the plaintiff and the deceased behaved as a couple. There is clear evidence that the deceased wished to marry the plaintiff but she refused because she feared that he wished to go back to Yugoslavia and she wanted to stay in Australia with her daughters. He gave her a ring and a locket with his name engraved upon each. On the morning he died the plaintiff ran next door to the neighbours crying out, "I have lost my Dusan." 39 Clearly, I think there was a substantial amount of mutual commitment and support between them. CARE AND SUPPORT FOR CHILDREN 40 The evidence discloses that the deceased acted as the father of Milica and Milovina while they were living with him and even thereafter. 41 I have already mentioned the fact both the deceased and the plaintiff guaranteed Milovina's loan so she could purchase a property. There seems to have been inter-reaction with the grandchildren when they came along; for instance, the grandchildren being taken to football matches. HOUSEHOLD DUTIES 42 It is plain on the evidence the plaintiff prepared all the meals, did all the cleaning and washing and looked after the house. REPUTATION AND PUBLIC ASPECTS 43 There was evidence from next door neighbours and other friends the plaintiff and the deceased acted as a couple. Clearly they participated together in family gatherings and this is clear from the many documents and photographs that have been tendered. 44 There remains the alleged agreement referred to in the conversation between the deceased and the defendant. No actual document has been produced. It was suggested that the parties were not in a de facto relationship. I would not see it as supporting that proposition. All it signifies is an agreement to perhaps perpetrate some fraud on the Social Security. 45 Having regard to the whole of the evidence, I am satisfied there was a de facto relationship between the plaintiff and the deceased for thirty years. Even if there were not, clearly the plaintiff was part of his household and was dependent upon him for accommodation. Having regard to the relationship, I would have found factors warranting the making of the application. 46 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 it said: "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' et cetera 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 et cetera 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." THE PLAINTIFF'S SITUATION IN LIFE 47 The plaintiff is seventy-six years of age, single and has no dependants. She presently lives in the deceased's home at Chester Hill where she has lived for the last thirty-two years. She presently has a life expectancy of 13.5 years. Apart from her furniture, her only asset is a bank account in the sum of about $7000. Her income is about $235 a week and her expenses amount to $296 per week. She is in reasonable health but needs new dentures but is reluctant to do so until she knows what her situation is. She also suffers from arthritis and would like some treatment for that but cannot afford it. 48 Obviously there was a happy relationship between the deceased and the plaintiff. 49 It is also necessary to consider the situation in life of others having a claim on the testator's bounty. In this case it is the beneficiaries in the estate. As it is not sought to affect the other legacies, their situation, given the size of the estate, is not relevant. 50 There has been no evidence placed before the Court by either of the residuary beneficiaries. In those circumstances, the Court can assume they do not wish the Court to have regard to their personal financial situation, or the relationship which they may have had with the deceased. In those circumstances, there is no claim which competes with the plaintiff's claim. 51 It is necessary to see how the plaintiff says she has been left without adequate and proper maintenance, education and advancement in life. She wishes to be given the Chester Hill property and a sum to supplement her income and a sum for contingencies. 52 In Marshal 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 strength of a claim can be affected by the length of a relationship and contributions to the relationship. 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 (11985) 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." 53 In this case there are a number of matters to note. Firstly, of course, it is a de facto relationship and the parties were not married but I think also is to be noted that it was a committed relationship and that it had a long duration, namely, thirty years. On the evidence, it would appear to have been a happy relationship and there were no breaks other than the trip which the deceased made to see his sick mother and sister in Yugoslavia. 54 On the other hand, it has to be noted that their relationship did start when both parties were in middle age. They had no children as a result of their relationship and their caring for the children of the plaintiff was only for a year or two. 55 Another matter that has to be noted is it was the deceased who contributed all the property which is now in the estate. 56 The plaintiff did some work but it pales into insignificance when it is considered it was the deceased who provided all the assets. 57 The present property is a four-bedroom house and obviously it may be too big for the plaintiff. She does not want, however, the upheaval that would be involved if she had to move from the house. She wants to see more of her daughters, one of whom lives at Campbelltown and the other at Kemps Creek. She does not drive and it would mean if she were to see more of her daughters she would have to get a taxi in order to be independent in that respect. 58 It was suggested that it might be appropriate for her to have a somewhat cheaper house near her daughters and that that might satisfy her needs. That, however, is some disturbance of her current routine. 59 So far as income is concerned, using the five per cent tables, a lump sum of $30,954 would protect her from her present income shortfall. 60 It was suggested she should have a life estate in the property but I do not think that is appropriate because she should receive some substantial capital sum. It was, after all, a thirty-year committed de facto relationship. 61 Perhaps in the circumstances it is best to allow her to have the home with a modest capital sum, probably something less than would normally be awarded. This will be on the basis that in due course when she does decide that the time has come when she needs to move into something smaller or elsewhere she can sell it and have some more funds available to her. 62 Accordingly, the orders I make are as follows: 1. That the plaintiff receive a bequest of the property 28 Bambridge Street, Chester Hill absolutely. 2. That the plaintiff's legacy in the form of that granted to the plaintiff in the will of the deceased be increased to $60,000. 3. Interest will be payable on the legacy if not paid within two months of today's date on and from that date at the rate provided for under the Wills Probate & Administration Act 1898 (NSW). 4. The costs of the plaintiff on a party/party basis and the costs of the defendant on an indemnity basis be paid or retained out of the estate of the deceased. 5. I order the exhibits be returned.

(Counsel addressed on the question of costs.) 63 I have had some correspondence tendered and it is plain in a letter from the solicitors for the plaintiff, which was immediately before the action was commenced, that they endeavoured to settle the matter and offered to settle on the basis that the plaintiff only receive the house property. The letter also set out in point form the type of evidence which it says it was going to advance in the proceedings and gave twenty-one days for acceptance. That offer was not accepted and it is suggested it was not appropriate to be accepted because the evidence was not available and as an executor the defendant was bound to uphold the will. 64 It also appears there were offers to mediate the matter in March 2005, which were not accepted, and there were further offers to have settlement negotiations at the beginning of June 2005. Nothing has come from those. 65 In the circumstances, it seems to me it is appropriate the plaintiff's costs should be on an indemnity basis and I so order.

15/08/2005 - corrections under the slip-rule. - Paragraph(s) 3, 8 and 62

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