Nikolic v Nikolic & 2 Ors

Court of Appeal (NSW)|2002-07-25|Before: Giles JA, Young CJ

CITATION : Nikolic v Nikolic & 2 Ors [2002] NSWCA 248 FILE NUMBER(S) : CA 41065/01 HEARING DATE(S) : 25/07/02 JUDGMENT DATE : 25 July 2002

Ratomir Nikolic (Appellant) PARTIES : Zoran Nikolic (First Respondent) Petar Dobrich (Second Respondent) Dragica Nikolic (Third Respondent) JUDGMENT OF : Giles JA at 20; Young CJ in Eq at 21; Davies AJA at 1

LOWER COURT JURISDICTION : Supreme Court LOWER COURT ED 1499/00 FILE NUMBER(S) : LOWER COURT Macready M JUDICIAL OFFICER :

G McGrath (Appellant) COUNSEL : In Person (First Respondent) & for (Third Respondent) B Shields (Second Respondent) Stojanovic Solicitors (Appellant) SOLICITORS : Deacons (First & Third Respondents) Ebsworth & Ebsworth (Second Respondent) CATCHWORDS : REAL PROPERTY - transfer of property to son without consideration - whether undue influence on part of son - whether negligence on part of solicitor - no point of principle. LEGISLATION CITED : Family Provision Act 1982 CASES CITED: Clark Boyce v Mouat [1994] 1 AC 428 DECISION : Appeal dismissed with costs.

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 41065/01 ED 1499/00

GILES JA YOUNG CJ IN EQ DAVIES AJA

RATOMIR NIKOLIC v ZORAN NIKOLIC & 2 ORS Judgment 1 DAVIES AJA: This is an appeal from a decision of Master Macready given on 14 December 2001. The Master dismissed a claim brought by the appellant, Ratomir Nikolic, against his son Zoran, his daughter-in-law Dragica and his solicitor Petar Dobrich. In dismissing the claim, the Master ordered the appellant to pay the costs of the proceeding on an indemnity basis as he considered the proceedings were without merit. 2 The matter which led to the proceedings was that the appellant, in August 1997, married his third wife Radmilla. He wished to deceive his wife and to ensure that, on his death, she had no claim to the house at 113 Brisbane Road at St Johns Park. 3 With a view to achieving this end he transferred, in two stages, title to the property to his son Zoran. Zoran later put the property in the names of himself and his wife Dragica. The transfer of the property to Zoran was effective to ensure that the property would not pass under any will which the appellant might make in his wife's favour and that the wife could not make a claim on the property under the Family Provision Act 1982, provided that the appellant survived a further three years. 4 It was undoubtedly immoral for the appellant to so act and I would not condone his conduct. 5 Subsequently, after the appellant's wife had ascertained what had occurred, the appellant instituted the proceedings which came before Master Macready claiming fraud, undue influence and negligence. 6 In this appeal, although the notice of appeal challenged the findings of Master Macready on all grounds, Mr McGrath, counsel for the appellant, has very properly withdrawn the allegation of fraud. I agree with that approach. In my view, there are no facts before the Court which suggest fraud or on which an allegation of fraud could be put with propriety. 7 I see no error in the Master's conclusion that none of the grounds of claim has been established. The sequence of events shows that the transfer of title occurred because the appellant wished to ensure that title to the property passed to his son Zoran and that his wife could make no claim on it. 8 On 18 October 1996, the appellant executed a will in which Zoran was named as the sole beneficiary. In August of the following year, the appellant married his third wife, Radmilla. Thereafter, the appellant formed the view that he should take steps to ensure that his wife should have no claim on the property. The appellant's view is clearly set out in a letter which he wrote to Zoran in August 1998 which said, inter alia: "I will have to write a will to say that I am giving her half of the house, provided she looks after and cares for me until my death. Speak with Petar whether it is better if I constitute a contract of gift before I sign a will or after, or do we write a contract of gift at all. I am trying to convince her that by law she has rights after my death".

The view which was there set out is also recorded in file notes which Mr Dobrich kept of the conversations which the appellant had with him. The appellant gave considerable thought to the problem during 1997 and had several conversations with Mr Dobrich about it. 9 On 29 December 1997, the appellant executed two documents prepared by Mr Dobrich. One was a transfer of the remainder in the property leaving the life interest with the appellant. The other was a will leaving the appellant's movables to Zoran. The previous will in Zoran's favour had been revoked by the appellant's marriage. 10 I see no element of undue influence or negligence in these transactions. They were initiated by the appellant's instructions and were an effective means of achieving what he wished. 11 Mr McGrath criticised some of the language used by Mr Dobrich in explaining to the appellant the nature of the transfer of the remainder interest. I agree with the trial judge that the words used by Mr Dobrich were adequate to and did convey to the appellant the substance of the transaction. 12 Throughout 1998, the appellant came under increasing pressure to make a will in favour of his wife. In early August, he wrote to Zoran the letter I have already mentioned. On 13 August 1998, the appellant conferred with Mr Dobrich. He executed two documents, one being a transfer of the life interest to Zoran and the other a release of the property to the appellant to enable him to live in the property as long as he wished. These transactions were probably unnecessary. However, I am satisfied, as was the Master, that the appellant remained concerned about the property and wished to make entirely sure that his wife would have no claim on it. The transactions were not inappropriate to achieve that. 13 On the same day, 13 August 1998, Mr Dobrich prepared a will in the appellant's native language, Serbian, which left his estate to Zoran. On 18 September 1998, the appellant executed a sensible will, drawn by Stojanovic Solicitors, which left an interest in the property to the appellant's wife. Later that same day, the appellant executed the will drawn by Mr Dobrich thus revoking the will drawn by Stojanovics. 14 The will of 18 September is of significance for it recites, in the Serbian language, the appellant's reasons for passing on his property to Zoran and Zoran's descendants. It explains that, after he married, his wife began to put pressure on him to transfer and leave the house to her. The will went on to say: "She has family here in Australia, her son, her daughter and her grand-kids. She has movable properties here in Australia and in Yugoslavia as well. I wish to leave all my property to my son Zoran and to his family. I was put in the situation to make a will in her favour, it was not my wish and intention. The property of my wife would go to her family and my property will go to my family. After my death, her property is big enough to secure her future life". 15 Again, I see no evidence of undue influence or negligence in the transactions resulting from the conference of 13 August 1998. They were undesirable for they assisted the appellant to deceive his wife and to avoid making proper provision for her; but that was what the appellant wished. 16 Mr McGrath submitted that the transactions were improvident. In one sense they were. But the appellant preferred his son to his wife. He was entitled to achieve the result which he did. He was the moving party. He instructed Mr Dobrich to achieve the result which he, the appellant, wished. 17 On the aspect of negligence, the Master pertinently referred to the remarks of Lord Jauncey in Clark Boyce v Mouat [1994] 1 AC 428, where his Lordship said at 437: "When a client in full command of his faculties and apparently aware of what he is doing seeks the assistance of a solicitor in carrying out a particular transaction, that solicitor is under no duty, whether before or after accepting instructions, to go beyond those instructions by proffering unsought advice on the wisdom of the transaction. To hold otherwise could impose intolerable burdens on the solicitors".

I agree with those comments. I see nothing in the facts of the case which suggests to me that there was negligence on the part of Mr Dobrich. 18 The last point of fact to which I should refer is that, subsequently, the appellant's wife found out what had happened. That resulted in a telephone call and in the appellant leaving a message on an answering machine. That message was played in court before the Master. The Master said, in respect of the conversation, that it was perfectly apparent that the appellant was aware that he had been found out about the fact that ownership of the house had been transferred to Zoran. The Master also took into account a conversation which the appellant had with Dragica Nikolic on 10 February 1998: "Ratomir: I want you to get Zoran to transfer the house back to me. Radmilla has found out. She is going to leave me unless I get the house back. Dragica: It is not as simple as that. We have incurred considerable expense in accepting the transfer of the property to us. It will cost more money to transfer it back to you. Ratomir: You will just have to borrow the money you need to do it. Radmilla will leave me unless you do. I'll take you to court if you don't transfer the property back. You'll have to do it then. You have no proof that I wanted to transfer the property to you in the first place." 19 In my opinion, no ground has been established for doubting any of the conclusions reached by the Master. I would dismiss the appeal with costs. 20 GILES JA: I agree. 21 YOUNG CJ in Eq: Yes, I also agree. 22 GILES JA: Those will be the orders of the Court. **********

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.

At a glance

Court

Decision date

Before

Source

Judgment (10 paragraphs)

Parties