Penfold v Predny

Supreme Court of NSW|2016-03-09|Before: Hallen J

iff) David Milan Predny (first Defendant) Brett Kenneth Douglas (second Defendant) Representation: Counsel: Mrs M Bridger (Plaintiff) Mr L Ellison SC (Defendants)

Solicitors: Lambton Law Solicitors (Plaintiff) Fowler Predny (Defendants) File Number(s): 2015/109674

The Claim

HIS HONOUR: This is a claim for a family provision order, under Part 3.2 of the Succession Act 2006 (NSW) ("the Act"), out of the estate of Colin Kenneth Douglas ("the deceased") who died on 10 April 2014. (At the hearing, the parties agreed that there is no property that may be designated as notional estate.) The claim is made by Donna Gaye Penfold, a child of the deceased. The Plaintiff seeks greater provision than that made for her in the deceased's Will.
The Act applies in respect of the estate and notional estate of a person who died on, or after, 1 March 2009. The Act replaces the Family Provision Act 1982 (NSW) ("the former Act"), which was repealed, effective from 1 March 2009. A family provision order is an order made by the Court, under Chapter 3 of the Act, in relation to the estate, or notional estate, of a deceased person, to provide from that estate for the maintenance, education, or advancement in life, of an eligible person.
The Defendants in the proceedings are David Milan Predny, a solicitor, who is the first Defendant, and Brian Kenneth Douglas, the only other child of the deceased and the sibling of the Plaintiff, who is the second Defendant. Both are executors named in the deceased's Will to whom Probate was granted.
The Plaintiff commenced proceedings by Summons filed on 7 April 2015. It is not in dispute that she is an eligible person, within the meaning of that term in s 57(1)(c) of the Act (a child of the deceased), or that the proceedings were commenced within the time prescribed by the Act (not later than 12 months after the date of the death of the deceased).
The only issues in dispute in the proceedings are whether the Plaintiff has been left with inadequate provision for her proper maintenance or advancement in life and, if so, what, if any, further provision ought to be made out of the estate for those purposes.
In the proceedings, one cannot help but remember what was written by Professor Rosalind Croucher in a speech entitled "Succession Law Reform in NSW - 2011 Update" (which was delivered at the Blue Mountains Annual Law Conference, Katoomba, 17 September 2011) in relation to some claims brought by: "a cohort of 'independent, self-sufficient 50 and 60 year olds wanting to get more of the pie from their parents, notwithstanding that the parent had made a conscious decision that they had already had enough".

Background Facts

I am satisfied that the following facts have been established, and that they provide a useful background. In relation to any disputed matters, the following facts should be regarded as the findings of the Court.
The deceased died aged 81 years, having been born in January 1932.
The deceased was married to Margaret Ruth Douglas ("Margaret"), and they remained married until her death in February 2013, aged 74 years.
The deceased and Margaret had only two children, who are both parties in the proceedings. The Plaintiff was born in February 1964 and the second Defendant was born in October 1966.
The Plaintiff and her husband, Gregory John Penfold, have three children, namely Luke, Chad and Brita. Each is an adult. The second Defendant has two children, Ella and Ryan, each of whom is a minor.
The deceased's last Will was one dated 2 May 2013. By that Will, the Plaintiff received a pecuniary legacy of $50,000, and the rest and residue, after the payment of debts, funeral and testamentary expenses, was left to the second Defendant. This Court granted Probate of the deceased's Will to the Defendants on 26 June 2014.
According to the Inventory of Property, a copy of which was attached to the Probate, the property solely owned by the deceased, at the date of his death, was disclosed as having an estimated, or known, gross value of $504,201. His estate was said to consist of real estate at Morisset (to which I shall refer as "No. 168") ($450,000), monies in a bank account ($41,367), two cars ($4,500) and some shares ($8,344).
The liabilities of the estate, which have been paid, total $14,546.
At the date of hearing, the parties agreed that the deceased's estate had an estimated value of $554,348. The estate, currently, is said to consist of No. 168 (with an agreed value, for the purposes of the hearing, of $510,000), cash in the Defendants' solicitors' trust account ($28,698), the cars ($3,350), the shares ($9,800) and tools ($2,500).
The parties agreed that it will be necessary to sell No. 168, whatever the result of the proceedings. They agreed, also, that the costs and expenses of sale of No. 168 would be $13,220. Subject to any order for costs, they also agreed that the legacy of $50,000 should be paid to the Plaintiff. There is also a claim for $2,500 by the second Defendant (which was in dispute but which was not the subject of any cross-examination) which also should be deducted from the gross value of the deceased's estate.
It follows that, without deducting the costs of the proceedings, the value of the net estate available for distribution is $488,628.
Usually, in calculating the value of the deceased's estate finally available for distribution, the costs of the present proceedings should be considered with circumspection, since the Plaintiff, if successful, normally will be entitled to an order that her costs, calculated on the ordinary basis, be paid out of the estate of the deceased, whilst the Defendants, as the administrators, irrespective of the outcome of the proceedings, normally, will be entitled to an order that their costs, calculated on the indemnity basis, be paid out of the estate.
Because the costs and disbursements of each of the parties are, in my view, disproportionate, bearing in mind the nature of the case, the issues in dispute, and the value of the estate, more will need to be written later in these reasons regarding what order for costs would be appropriate. For the time being, however, I shall simply refer to the evidence of costs read at the hearing.
The Plaintiff's solicitor, Mr M E Hanlon, deposed in an affidavit sworn on 12 February 2016, that the Plaintiff's costs and disbursements, calculated on the "party/party basis", are estimated to be $93,625 (upon the basis of a two day hearing and inclusive of GST). At the hearing, I was informed from the bar table, without objection, that the Plaintiff's estimated costs and disbursements, calculated on the ordinary basis, were estimated to be $85,825, but, later, I was informed that this estimate was in error as it did not include any amount for GST, with the result that the earlier costs estimate should be used.
The first Defendant, in an affidavit affirmed on 8 February 2016, estimated the Defendants' costs and disbursements of the present proceedings, including senior counsel's fees, calculated on the indemnity basis (upon the basis of a two day hearing) to be $74,704 (inclusive of GST and on the basis of a 2 day hearing). However, at the hearing, I was informed from the bar table, without objection, that the Defendants' estimated costs and disbursements, calculated on the indemnity basis, are estimated to be $76,675 (inclusive of GST and on the basis of a 2 day hearing).
Before leaving the subject of costs, I should mention that although, when raised by the Court, counsel for the Plaintiff indicated that there may be a Calderbank offer made by the Plaintiff, the terms of which offer could be relevant on the question of costs, after the calculations about the size of the estate were made, she conceded that it was unlikely that the terms of the Calderbank offer would be relevant: T6.07-T6.20. For this reason, the parties agreed that I should determine how the costs of the proceedings should be borne as part of the reasons for judgment. I propose to do so. For reasons to which I shall come, it is unnecessary to determine any question of costs capping, a subject upon which some attention was paid during submissions.
The only other matter to which reference should be made is the Defendants' concession that, in the event her proceedings are dismissed and an order is made for the Plaintiff to pay their costs calculated on the ordinary basis, such costs will be limited to the amount of the legacy. It was submitted that, in this way, it would not be necessary to delay the completion of the administration of the estate, and that the legacy payable to her would be utilised to satisfy that order as to costs.
It follows, then, that if all of the costs of the parties ($170,300) were deducted, the amount available for distribution would be $318,328. If only the Defendants' costs were deducted, the amount available for distribution to the second Defendant would be $411,953.
The parties agreed that there are no other eligible persons in respect of whom an application for a family provision order may be made.

Other Facts

There are a number of other facts that are the subject of evidence that I am satisfied have been established. I mention these facts now since there was some dispute about some of them.
The first Defendant prepared three Wills for the deceased, the contents of the first two of which will be referred to later in these reasons. The first in time was dated 11 October 2005, the second in time was dated 22 April 2013, and the last Will has been identified above.
The first Defendant held a number of meetings, and had a number of telephone discussions with the deceased, prior to the preparation and execution of each of the 2013 Wills. The first Defendant made contemporaneous file notes of each of the meetings and of the telephone conversations, a copy of all of which file notes were tendered by the Defendants (Ex. 1).
It is not necessary to rehearse the contents of the diary notes, all of which I have carefully considered. In any event, the rationale for what the deceased intended is set out in other documents, the terms of which will be referred to.
On 29 April 2013, the first Defendant also had a discussion with the second Defendant. I do not place the same emphasis on this discussion as did counsel for the Plaintiff in cross-examination. However, I have noted that there was such a discussion.
The first Defendant gives the following evidence which I accept: "… 8. According to my file notes I spoke with the deceased for 50 minutes on 22 April 2013; for 30 minutes on 29 April 2013; for 25 minutes on 2 May 2015; on 15 August 2013 for an unrecorded period of time; and on 23 October 2013 for 18 minutes and on 24 October 2013 for 30 minutes. 9. At my meeting with the deceased on 22 April 2013, the deceased instructed me to prepare a new Will. 10. The deceased and I discussed the deceased's wishes and I ascertained that, following the death of his wife, the deceased wished to revoke his 2005 Will which left his estate equally to his two adult children Donna Penfold and Brett Douglas. 11. I also ascertained from the deceased that in about 1997 he had gifted his share of a second property which was on land adjoining his home to his daughter Donna. The deceased referred to this property as "The Pink House" which I understood was a reference to the colour which the old cottage standing on the land was painted. 12. I was instructed by the deceased that Donna and her husband Greg had not paid anything for the property which the deceased informed me was worth about $97,000.00 at the time he signed it over. I ascertained from the deceased that Donna and her husband currently lived on the adjoining property with her children. I ascertained that it was the deceased's view that Donna had, in effect, received part of her inheritance early, in the form of that gift of the Pink House. 13. The deceased then said to me in words to the effect, "I want to treat my children fairly." The deceased produced a market appraisal dated 28 March 2013 which he had obtained from a Mr John Britten of the Professionals Real Estate at Morisset. … The deceased said to me in words to the effect, "My property is worth about $450,000 and Donna's property is worth about $320,000 according to the agent but the agent got it wrong because he thought Donna's property was only 1500 square metres but it is really 4403 square metres. I think Donna's property is worth a lot more. I think it would be worth at least $350,000." 14. During my meeting with the deceased, I did some calculations based on the deceased's express wish to try and achieve parity between his two children by taking into account the property which Donna had already received. On the basis that Brett was to receive the deceased's home which he believed was worth approximately $450,000 and Donna having already received land and improvements which the deceased believed was worth approximately $350,000, the deceased was of the view that he should leave a $50,000 bequest to Donna and that way each of the children would receive a benefit of $400,000. 15. The deceased instructed me to prepare a Will leaving the sum of $50,000 to the deceased's daughter Donna with the remainder of the deceased's estate left to the deceased's son, Brett Douglas. 16. I ascertained from the deceased that the remainder of his estate would be of relatively modest value. 17. It was my understanding that by leaving a bequest in the sum of $50,000.00 to Donna, the deceased would achieve his desired intent of seeing both of his children achieve parity. 18. I prepared a new Will for the deceased. The deceased signed his Will in my office on that day… The attesting witnesses to that Will were my secretary, Mrs Tracy Dean, and my law clerk, Scott Predny. 19. On 29 April 2013 I had a conversation with the deceased and with his son, Brett Douglas. During that conversation, the deceased gave me instructions to prepare an Enduring Guardian appointing Brett Douglas as his Guardian. … 22. I had a meeting with the deceased on 15 April 2013. The deceased was accompanied to this meeting by a person who was introduced to me as his friend, Yvonne Fitzpatrick. At the meeting the deceased said to me words to the effect, "Donna is pressuring me to be appointed my Attorney but I don't want to. I'm happy to leave my son, Brett, as my attorney." I ascertained from the deceased that he was concerned that Donna was questioning his capacity and I further understand the deceased had spoken to his doctor about this. I further ascertained from the deceased that he was living on his own, was able to cook his own meals and he looks after himself and was still driving. I was of the view that the deceased was of capacity to handle his own affairs. 23. I ascertained that each of the deceased's children seemed to be suspicious of the other and the deceased gave me instructions to prepare a new Power of Attorney appointing both Brett and Donna as his attorneys. I suggested that he appoint them jointly, but not severally in order that the two children must act together. On 15 August 2013 the deceased signed a Revocation of his earlier Power of Attorney made in 2005 and a new Power of Attorney jointly appointing Brett Douglas and Donna Penfold and I witnessed his signature on these documents. On 26 August 2013 Donna Penfold signed an acceptance of the appointment. On 20 September 2013 Brett Douglas signed an acceptance of the appointment. 24. On or about 21 October 2013 the deceased's daughter, Donna, delivered a document to my office purporting to be signed by the deceased and authorising Donna to receive a copy of the deceased's Will and Power of Attorney. … 25. I telephoned the deceased on 23 October 203 to check his instructions as the contents of the authority appeared to be contrary to the earlier instructions I had been given by the deceased which was not to disclose the contents of his Will to Donna. During that telephone conversation, the deceased informed me in words to the effect, "I'm feeling pressured by Donna." He also informed me. "I'm feeling pressured by Brett" and "I felt pressured by Greg Penfold to sign the letter [dated 21 October 2013]." I suggested to the deceased that I write a letter to both of his children summarising his Will and his reasons and stating that he did not want to be pressured by either of them to change his Will. The deceased instructed me to hold off sending such letter. 26. I subsequently had a meeting with the deceased on 24 October 2013 which lasted 30 minutes. The deceased said to me words to the effect, "I thought my Will was my secret. I am feeling pressure from both Donna and Brett. I have told them both to back off." (My emphasis)
(The first Defendant gave evidence that when the deceased expressed things, he did so in terms of "We did this" or "We did that". The first Defendant understood the deceased's reference to "we" as referring to Margaret and himself. Counsel for the Plaintiff sought to highlight this aspect, submitting that the provision made for the Plaintiff in 1997 derived as much from Margaret as from the deceased.)
Subsequently, the deceased instructed the first Defendant to write to each of his children, which the first Defendant did on 30 October 2013. The following is part of the contents of the letter: "… We are instructed that our client had given very careful consideration as to how he wished to have his estate dealt with upon his death. Your father has instructed us to provide to you the following information and in the hope that this will stop any further questioning or pressure being brought to bear on him regarding these matters. To this end we can confirm that: 1. Mr Douglas' Power of Attorney a) Your father has appointed both his children namely, Mr Brett Douglas and Ms Donna Penfold to be his Attorneys. The appointment is joint and several and Mr Douglas intended that should the time come when he needs assistance with management of his finances that both Donna and Brett would act in unison and that any decisions are made after consultation between both children and them having reached a common consensus; b) Mr Douglas does not feel that he is in need of assistance managing his financial affairs. The Power of Attorney simply makes provision for what may be required in the future if Mr Douglas either feels the need for assistance or becomes unable to manage his own affairs. 2. Mr Douglas' Will made 2 May 2013 a) Mr Douglas has carefully considered what he wishes to be done with his estate when he passes away. He wishes to treat both children fairly and he has taken into consideration benefits or gifts which he has bestowed during his lifetime when deciding how he wishes his estate to be distributed under his Will; b) Your father has given very careful consideration as to what needs to be done in order to treat both of his children fairly; c) Mr Brett Douglas and Ms Penfold are the only beneficiaries of his Will, however he does not wish to leave his estate equally to them, he wishes to leave a larger share of his estate to his son in order to achieve what he considers to be the fairest outcome; d) We are instructed that Donna has already received benefits from our client during his lifetime. We understand that Mr Douglas transferred his interest in a family property he refers to as "the pink house" (xxx xxxxx xxxx, Morisset) to Donna some years ago. We understand that Donna and her husband have lived at that property and have subsequently subdivided. Mr Douglas is clearly of the opinion that Donna has gained substantial benefit in the form of enhancing her asset position as a result. e) Although Mr Douglas had signed documents suggesting he had been paid money for the transfer, this was not the case and that document was provided in order to assist Donna to obtaining finance and approval for subdivision and development of the land. f) Mr Douglas says that his interest in the land was not sold but rather gifted to Ms Penfold and her husband and they have enjoyed the benefit of this property and subsequent enhancement in property value over the ensuing years. g) Mr Douglas has been guided by current property values. It is his view that if his estate were to be divided equally between his two children then this would be an unfair result and accordingly his Will reflects that Ms Penfold should receive a smaller share of his estate when he dies because of the benefit she has received during his lifetime. h) Mr Douglas' current Will accurately reflects his wishes and he does not want to make any changes to it. i) If pressured to make any change to his Will, Mr Douglas would likely reconsider his testamentary provisions and leave his estate in a manner that may not be to the liking of either of the current beneficiaries."
The Plaintiff did not respond to the letter that was sent to her by the first Defendant.
The deceased left a signed Statement dated 2 May 2013 which is in the following terms: "1. I refer to my Will I have today executed. 2. It is my wish to treat of my children fairly. 3. My daughter, Donna Gae Penfold, has already received substantial benefit from me during my lifetime. 4. In or about 1997 I gifted to my daughter my interest in the real property known as Part xxx xxxxxx xxxx, Morisset and being Lot x in DP xxxxx. That property (which I refer to as "the pink house") formerly belonged to my mother and it was to pass on her death to her 5 children. I wished to acquire that property and purchased it from my mother's estate by paying to the estate a sum of money equal to 4/5 of the then market value. 5. My son, Brett, and daughter, Donna, assisted me with the acquisition of the property by them each contributing $25,000 and $22,000 respectively. 6. One of my reasons for acquiring the pink house was to provide accommodation for my daughter, Donna. 7. I have repaid the moneys advanced by Brett. 8. Donna and her husband have lived in the pink house free of rent or other charge. 9. Sometime later and at Donna's request, I agreed to transfer the pink house to Donna. Donna and her husband Greg Penfold had in several conversations told me they would buy the pink house for market value but there was never any moneys paid by them to me. 10. Sometime later still, Greg Penfold told me of his and Donna's plan to build a second cottage on the land. I was led to believe that they could not obtain council permission for a dual-occupancy development whilst ever money was owed on the land. At Greg's request, I signed a document prepared by him stating in words to the effect that I had been paid in full and there was no money owing to me for the land. Even though it was not true, I signed it as I wanted to help Donna and I was led to believe this was necessary for her to carry out the development. 11. Donna and Greg subsequently built a new house on the land and moved into it. The pink house has been rented out by Donna. 12. Consequently, my daughter has derived benefit from my transfer of title to the pink house as the property has been her home and has allowed her to benefit by developing the land as a dual-occupancy with potential to subdivide into two separate titles. 13. To achieve my aim to treat both children fairly I wish that my son should receive, by way of inheritance, my home at xxx xxxxxx xxxx, Morisset being Lot x in DP xxxxxx. 14. I believe that the value of the pink house and the large parcel of land on which it stands represent a substantial benefit which I have provided to Donna during my lifetime. 15. Doing the best I can to achieve a fair balance between my two children and taking in to account the benefit Donna has derived from having me transfer title to the pink house to her in or about 1997, I have left to her a bequest of $50,000 and I leave the remainder of my estate to my son Brett."
I have included the contents of the letter and the deceased's Statement, each of which was not objected to, because I consider that it reveals the deceased's view of the conduct of each of his children and the considerable amount of thought that he seems to have given to his testamentary intentions.
The letter written by the first Defendant, on instructions from the deceased, also reveals the deceased's view of what appears to have been the deep feelings of entitlement held by each of his children, and the distrust by each of the other. (These emotions are likely to have to have played some part in the conduct of this litigation.)
The real property now in the name of the Plaintiff, originally owned by the deceased's mother, Elsie May Douglas, was a parcel of land to which I shall refer as No. 178. On intestacy, the parcel of real property was to pass to her 5 children equally, one of whom was the deceased. Following the death of the deceased's mother, the 5 children agreed that the deceased could purchase the interest of his siblings for $72,000 (each of his 4 siblings to receive $18,000). Thus, the value of No. 178, at the time of its purchase from that estate, was $90,000 (since the deceased did not receive the amount of $18,000).
By Transfer dated 17 April 1990 (a copy of which is Ex. A), No. 178 was transferred to Margaret, as to one-half share as tenant in common, to the Plaintiff, as to one-quarter share as tenant in common, and to the second Defendant, as to one-quarter share as tenant in common. The Transfer was registered on 14 May 1990.
Of the balance of the purchase price of $72,000 ($90,000 less the deceased's share of $18,000), the Plaintiff contributed $22,000 and the second Defendant contributed $25,000. How the balance ($25,000) was contributed is not entirely clear from the evidence, but it was paid by one, or both, of the deceased and Margaret. (A number of documents, forming part of Ex. 1, to which I shall refer, suggest that the deceased may have paid the amount. However, whether the deceased, alone, paid that amount may not matter, since the whole of No. 178 was transferred in 1990, to the persons referred to).
Whilst counsel for the Plaintiff cross-examined the second Defendant, suggesting to him that the whole of the balance had come from Margaret, I am not satisfied that this is so. Indeed, the Plaintiff's evidence is that the deceased "proposed that he and my mother pay the defendant for his share of [No. 178] and that my mother's and brother's interest be transferred to me". She also says that she and her husband "offered to pay out the defendant for his share of [No. 178] and pay my mother for her interest" but that they refused, saying that "they do not want or expect Greg and me to pay for the transfer".
By Transfer dated 24 August 1997 (a copy of the first page of which is Ex. B), the whole of Margaret's one-half share as tenant in common, and the whole of the first Defendant's one-quarter share as tenant in common, in No. 178, was transferred to the Plaintiff. The consideration shown on the Transfer was $1.00. The Transfer was subsequently registered, with the result that the Plaintiff came to be, and currently remains, the sole registered proprietor of the whole of No. 178.
At the time of the transfer to the Plaintiff, a valuation was obtained which revealed that as at August 1997, No. 178 had a market value of $90,000. Thus, the one quarter share held by the Plaintiff in No. 178, at that time had a value of $22,500.
There is no dispute that the second Defendant was paid $25,000 by the deceased for his share of No. 178 prior to its transfer to the Plaintiff. Margaret's share was also transferred, but as stated, the Plaintiff did not pay any amount for that share at the time of its transfer.
There was, originally, only one house on No. 178, which house was described in the evidence as "the Pink House". It was described in the valuation then obtained as "an old single weatherboard cottage of approximately 90 square metres on brick pier foundations with corrugated iron roof. The floors, window and door frames are timber, the internal wall linings and ceilings are panelboard. There was 1 bedroom, sunroom, lounge, kitchen bathroom, and laundry."
The Plaintiff gave evidence that since the transfer of No. 178 to her, she and Gregory have replaced the kitchen, installed a new bathroom, had the floorboards polished, have had it painted, had all the antennas replaced, added a little front patio and had the roof fixed because it had been leaking: T 31.36 - T32.00. She did not give evidence of the costs of the repairs and renovations.
Subsequently, after the transfer of No. 178 to the Plaintiff, the Plaintiff and Gregory built another residence on it, in which they and their children lived. Currently, only they live in this residence.
The Plaintiff was unable to inform the Court how much had been spent in building the second residence but said that it was at least $95,000, this amount being the proceeds of sale of a property that they owned which they sold in Windermere Park, a suburb of the City of Lake Macquarie: T32.10-T32.50.
In 1997, the Plaintiff and her family moved into the Pink House, where they lived for a few years until the second residence on No. 178, which they built, was partially erected. Thereafter, she has either rented the Pink House, or has allowed one or more of her children to use it. It is currently rented for $290 per week.

Error in the Deceased's Rationale for the Legacy of $50,000

There is no doubt that evidence of the intentions and wishes of the deceased in respect of provision for an applicant are admissible in family provision proceedings: Bosch v Perpetual Trustee Co Ltd [1938] AC 463, at [481]-[482]. Those testamentary intentions may also be taken into account by virtue of s 60(2)(j) of the Act.
However, it is to be remembered, as well, that the fact a statement is said to have been made by the deceased does not mean, necessarily, that the statement must unquestionably be accepted as true. Such a statement may be just as inaccurate, or as unreliable, as a statement of a living witness, whether as the result of mistake, or failure of memory, or deliberate untruth: Worsley v Solomon [2008] NSWSC 444, per McLaughlin AsJ, at [35].
In Pincius v Wood [1998] TASSC 46, Cox CJ noted: "A reason based on a belief proved to be mistaken may well be relevant in support of an applicant's claim. Thus if the reason advanced for inclusion is a mistaken belief in the prosperity of an applicant who enjoyed a good relationship with the testator that could properly be taken into account and would be a strong reason for interfering with the will…"
In Diver v Neal [2009] NSWCA 54 at [61], Basten JA wrote: "There will be cases in which intervention in the distribution of the estate will be justified on the basis that the testator was not fully aware of all the relevant circumstances when he or she made his or her will: see, eg, In re Allen (deceased); Allen v Manchester [1922] NZLR 218 at 220-221 (Salmond J). On the other hand, too much weight should not be given to the testator's expressed intention. The Court is not limited to considering the circumstances as they existed when the will was made, or when the testator died. Rather, s 9(2) requires the adequacy of provision to be determined as at the date of the hearing of the application. Furthermore, whatever the semantic phraseology, the authorities are unanimous that the Court is required to apply an objective standard in assessing the adequacy of the provision made."
More recently, in Brimelow v Alampi [2016] VSC 135, McMillan J wrote, at [15]: "It has always been the case that the courts have taken into account the terms of any expressions of the deceased in admissible form. In respect of applications made where a deceased died after 20 July 1998, the Court may accept any evidence of the reasons of a deceased for making the disposition in his or her will (if any) and for not making proper provision for an applicant, whether or not the evidence is in writing. By mandating that the Court must take such expressions into account it is not intended that such evidence, by will or in other evidence, suddenly takes on some higher status. The weight to be attached to such statements will depend on the circumstances. Reasons can be shown to be incorrect or misconceived, which may enhance or boost the strength or defence of a claim."
The first complaint made by the Plaintiff is that the deceased was not ever the registered proprietor of the whole, or any part, of No. 178. Accordingly, it was submitted that part of the deceased's Statement relating to the Plaintiff having "derived benefit from my transfer of title" to her is inaccurate. Furthermore, it was submitted, that he made no provision for the Plaintiff during his lifetime, a submission which I do not accept, since it seems that he contributed at least his share of his mother's estate and may have paid the second Defendant for his share when No. 178 was transferred to the Plaintiff in 1997.
It is also said that there is no evidence at all that the transfer to the Plaintiff of Lot 178 "has allowed her to benefit by developing the land as a dual-occupancy with potential to subdivide into two separate titles". Indeed, she gave evidence that she had never made application for dual occupancy of No. 178 or considered its sub-division (though there are now in fact two houses on the land).
Furthermore, it was noted that the Plaintiff had paid almost the whole of the value of her one-quarter share as tenant in common at the time of the purchase of No. 178 from the estate of the deceased's mother. It followed that, at its highest, the provision made by the deceased, during his lifetime, for the Plaintiff, was 75 per cent of its value at the date of the transfer of Lot 178 to her (assuming, without accepting, that Margaret made no contribution to the initial purchase price as consideration for her interest in No. 178).
The Plaintiff, having contributed $22,000 to the purchase of No. 178, a contribution acknowledged by the deceased, it was submitted, correctly, that the calculations made by the deceased (as stated in the diary note of the first Defendant of 22 April 2013), which led to the legacy of $50,000 being included in the last Will, are incorrect in that the deceased attributed the benefit of the transfer of the whole of the value of No. 178 to the Plaintiff ($350,000), instead of only attributing the benefit of the transfer of 75 per cent to her ($262,500) as she was the registered proprietor of a one quarter share as tenant in common, with her mother and brother, for which interest she had paid.
The calculation, if it had been made correctly, and if the deceased had intended to use the transfer of "his interest" in No. 178 in his calculations (assuming that the whole of Margaret's interest may be attributed to him) in determining what was "fair", the legacy in his Will would have been $93,750, rather than $50,000.
It appears, therefore, that the reasoning of the deceased, on the mathematics, was flawed.

Inadequacy of Provision

It may next be helpful to set out some features of the Act that are to be borne in mind in considering the only issue in the case.
Since the Plaintiff is an eligible person, and as she has commenced proceedings within the time prescribed by the Act, the Court must next determine whether adequate provision for her proper maintenance, education or advancement in life has not been made, relevantly, by the operation of the deceased's Will (the operation of the intestacy rules being irrelevant (s 59(1)(c)).
It is this mandatory legislative imperative that drives the ultimate result and, it is only if the Court is satisfied of the inadequacy of provision that consideration is given to whether to make a family provision order (s 59(2)). Only then may "the Court… make such order for provision out of the estate of the deceased person as the Court thinks ought to be made for the maintenance, education or advancement in life of the eligible person, having regard to the facts known to the Court at the time the order is made".
Relevantly, other than by reference to the provision made by the Will of the deceased, s 59(1)(c) leaves undefined the norm by which the Court must determine whether the provision, if any, is inadequate for an applicant's proper maintenance, education and advancement in life. The question would appear to be answered by an evaluation that takes the Court to the provision made for the applicant in the Will of the deceased, on the one hand, and to the requirement for maintenance, education or advancement in life of the applicant on the other. No criteria are prescribed in the Act as to the circumstances that do, or do not, constitute inadequate provision for the proper maintenance, education and advancement in life of the applicant.
Under s 59(1)(c), the time at which the Court gives its consideration to the question of inadequacy of provision is the time when the Court is considering the application.
The question whether the deceased has made adequate provision for an applicant is a question of objective fact, the determination of which involves an evaluative judgment (Singer v Berghouse [1994] HCA 40; 181 CLR 201 at [210]-[211]; White v Barron [1980] HCA 14; 144 CLR 431 at [434]-[5]; [443]).
If the Court is satisfied that inadequate provision for the proper maintenance, education or advancement in life has been made by the Will of the deceased, for the applicant, then the Court may make a family provision order. In determining the question, the Court has regard to, among other things, 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 circumstances and needs of the other beneficiaries or potential beneficiaries: see McCosker v McCosker (1957) 97 CLR 566 at [571]-[572]; Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201 at [209]-[210]; Vigolo v Bostin (2005) 221 CLR 191 at [16], [75], [112]; Tobin v Ezekiel [2012] NSWCA 285; (2012) 83 NSWLR 757 at [70]; Verzar v Verzar [2014] at [39].
The determination of the question whether the disposition of the deceased's estate was not such as to make adequate provision for the applicant will always, as a practical matter, involve an evaluation of the provision, if any, made for the applicant on the one hand, and the applicant's "needs" that cannot be met from her or his own resources on the other: see Hunter v Hunter (1987) 8 NSWLR 573 at [575] (Kirby P).
Thus, whether an applicant has a "need" or "needs" is also a relevant factor: see s 60(2)(d) of the Act. It is an elusive and an elastic concept to define, yet it is an element in determining whether "adequate" provision has been made for the "proper" maintenance, education and advancement in life of the applicant in all of the circumstances. The concept involves economic considerations.
"Need" has also been used in the context of a value judgment or conclusion, namely, that the applicant is "in need" of maintenance, education or advancement in life, because inadequate provision has been made for her or his proper maintenance, education and advancement in life: see Gorton v Parks (1989) 17 NSWLR 1 at [10]-[11] (Bryson J).
Although the existence, or absence, of "needs" which the applicant cannot meet from her, or his, own resources will always be highly relevant and often decisive, the statutory formulation and, therefore, the issue in every case, is whether the disposition of the deceased's estate was not such as to make adequate provision for her or his proper maintenance, maintenance education and advancement in life: see Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201at [227] (Gaudron J). Compare Gorton v Parks at [6]-[11] (Bryson J); Collicoat v McMillan [1999] 3 VR 803 at [38], [47] (Ormiston J).
"Need", of course, is also a relative concept: de Angelis v de Angelis [2003] VSC 432 at [45] (Dodds-Streeton J). It is different from "want" and does not simply mean "demand" or "desire". The latent difference between the words was stated by Lord Neuberger of Abbotsbury (now President of the Supreme Court of the United Kingdom), in the House of Lords decision, R (on the application of M) v Slough Borough Council [2008] UKHL 52; [2008] 1 WLR 1808 at [54]: "'Need' is a more flexible word than it might first appear. 'In need of' plainly means more than merely 'want', but it falls far short of 'cannot survive without'."
In Boettcher v Driscoll [2014] SASC 86; (2014) 119 SASR 523 at [41], David J added: "'Need' is not so synonymous with 'want' such that the two are interchangeable."
In Diver v Neal at [67], Basten JA wrote: "Some care has to be taken to distinguish between assessing a person's "needs", his or her goals in life and the manner in which they propose to use financial resources, if available. The Appellant's wish to make provision by way of providing deposits which would allow her two children to obtain housing may be seen to be a life goal, should her own financial circumstances permit."
As Callinan and Heydon JJ emphasised in Vigolo v Bostin at [122], the question of the adequacy of the provision made by the deceased "is not to be decided in a vacuum, or by looking simply to the question whether the applicant has enough upon which to survive or live comfortably". The inquiry is not confined only to the material circumstances of the applicant. The whole of the context must be examined. Thus, "need" may be assessed by considering the applicant's financial position, lifestyle and general expectations in life and health: Stewart v Stewart [2015] QSC 238 at [11] (Applegarth J).
In the event that the Court is satisfied that the power to make an order is enlivened (i.e. that adequate provision for her proper maintenance, education or advancement in life has not been made), then the Court determines whether it should make an order, and if so, the nature of any such order, having regard to the facts known to the Court at the time the order is made.
Then, under s 59(2) and s 60(1)(b) of the Act the Court determines what provision, if any, ought be made for the applicant out of the deceased's estate. Mason CJ, Deane and McHugh JJ, in Singer v Berghouse at [211], affirmed that this decision involves an exercise of discretion in the accepted sense. The fact that the Court has a discretion means that it may refuse to make an order even though the jurisdictional question has been answered in the applicant's favour.
Section 60(2) of the Act, at least in part, is new. It provides: "(1)The court may have regard to the matters set out in subsection (2) For the purpose of determining: (a) whether the person in whose favour the order is sought to be made (the 'applicant') is an eligible person, and (b) whether to make a family provision order and the nature of any such order. (2) The following matters may be considered by the court: (a) any family or other relationship between the applicant and the deceased person, including the nature and duration of the relationship, (b) the nature and extent of any obligations or responsibilities owed by the deceased person to the applicant, to any other person in respect of whom an application has been made for a family provision order or to any beneficiary of the deceased person's estate, (c) the nature and extent of the deceased person's estate (including any property that is, or could be, designated as notional estate of the deceased person) and of any liabilities or charges to which the estate is subject, as in existence when the application is being considered, (d) the financial resources (including earning capacity) and financial needs, both present and future, of the applicant, of any other person in respect of whom an application has been made for a family provision order or of any beneficiary of the deceased person's estate, (e) if the applicant is cohabiting with another person-the financial circumstances of the other person, (f) any physical, intellectual or mental disability of the applicant, any other person in respect of whom an application has been made for a family provision order or any beneficiary of the deceased person's estate that is in existence when the application is being considered or that may reasonably be anticipated, (g) the age of the applicant when the application is being considered, (h) any contribution (whether financial or otherwise) by the applicant to the acquisition, conservation and improvement of the estate of the deceased person or to the welfare of the deceased person or the deceased person's family, whether made before or after the deceased person's death, for which adequate consideration (not including any pension or other benefit) was not received, by the applicant, (i) any provision made for the applicant by the deceased person, either during the deceased person's lifetime or made from the deceased person's estate, (j) any evidence of the testamentary intentions of the deceased person, including evidence of statements made by the deceased person, (k) whether the applicant was being maintained, either wholly or partly, by the deceased person before the deceased person's death and, if the Court considers it relevant, the extent to which and the basis on which the deceased person did so, (l) whether any other person is liable to support the applicant, (m) the character and conduct of the applicant before and after the date of the death of the deceased person, (n) the conduct of any other person before and after the date of the death of the deceased person, (o) any relevant Aboriginal or Torres Strait Islander customary law, (p) any other matter the Court considers relevant, including matters in existence at the time of the deceased person's death or at the time the application is being considered."
It can be seen that s 60(2) enumerates 15 specific matters, in addition to any other matter the Court considers relevant, described by Basten JA in Andrew v Andrew [2012] NSWCA 308; (2012) 81 NSWLR 656 at [37], as "a multifactorial list", and by Lindsay J in Verzar v Verzar [2012] at [123] as "a valuable prompt" to which the Court may have regard for the purposes of determining eligibility, whether to make a family provision order and the nature of any such order. It has been suggested that the expanded list of criteria provides a "more focused direction to the court": Phillips v James [2014] NSWCA 4; 85 NSWLR 619 at [51] (Beazley P, Meagher JA agreeing).
The section does not indicate the relative weight that should be given to different matters, or "how conflict between opposing considerations should be resolved - those things are left to the court's discretion, which must, of course, be exercised judicially" (Mallet v Mallet [1984] HCA 21; (1984) 156 CLR 605 at [608]-[610], per Gibbs CJ in relation to the Family Law Act 1975 (Cth)).
Leaving aside the question of eligibility, the matters referred to in s 60(2) may be considered on "the discretionary question", namely whether to make an order and the nature of that order. Importantly, under s 60(2), attention is drawn to matters that may have existed at the deceased's death, or subsequently.
Sub-section (2)(d) refers to "earning capacity", which means no more than the capacity to find employment to earn or derive income.
Section 65(1) of the Act requires the family provision order to specify: 1. the person or persons for whom provision is to be made, and 2. the amount and nature of the provision, and 3. the manner in which the provision is to be provided and the part or parts of the estate out of which it is to be provided, and 4. any conditions, restrictions or limitations imposed by the Court.
The order for provision may require the provision to be made in a variety of ways, including a lump sum, periodic sum, or "in any other manner the Court thinks fit" (s 65(2) of the Act). If the provision is made by payment of an amount of money, the order may specify whether interest is payable on the whole, or any part, of the amount payable for the period, and, if so, the period during which interest is payable and the rate of interest (s 65(3) of the Act).
Any family provision order under the Act takes effect, unless the Court otherwise orders, in the case if the deceased made a will, in a codicil to the will (s 72(1) of the Act).
Section 66 of the Act sets out the consequential and ancillary orders that may be made.
Section 99(1) of the Act provides that the Court may order the costs of proceedings in relation to the estate, or notional estate, of the deceased (including costs in connection with mediation) to be paid out of the estate in such manner as the Court thinks fit.

Other Applicable Legal Principles - Substantive Application

I have set out the principles that apply in many other cases. There was really no dispute about them and counsel for the Plaintiff identified the principles that I set out in Newman v Newman [2015] NSWSC 1207 as being applicable to the facts of this case. I shall not repeat what I wrote in that case.
I should, however, refer to Cooper v Dungan (1976) 50 ALJR 539 at [542], in which Stephen J reminded the Court to be vigilant in guarding "against a natural tendency to reform the testator's will according to what it regards as a proper total distribution of the estate rather than to restrict itself to its proper function of ensuring that adequate provision has been made for the proper maintenance and support of an applicant".
In Stott v Cook (1960) 33 ALJR 447 at [453]-[4], Taylor J, although dissenting in his determination of the case, observed that the Court did not have a mandate to rework a will according to its own notions of fairness. His Honour added: "There is, in my opinion, no reason for thinking that justice is better served by the application of abstract principles of fairness than by 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. All this is, of course, subject to the proviso that an order may be made if it appears that the testator has failed to discharge a duty to make provision for the maintenance, education or advancement of his widow or children. But it must appear, firstly, that such a duty existed and, secondly, that it has not been discharged."

Additional Facts

I set out some more facts by reference to s 60(2) of the Act. Where necessary, I shall express the conclusions to which I have come in relation to areas of dispute between the parties. I have taken this course, not "to dwell on particular matters as if they were, in themselves, determinant of the broad judgments required to be made under s 59" (Verzar v Verzar [2012] at [124]), but in order to complete the recitation of facts that will assist me to determine the questions that must be answered. (a) any family or other relationship between the applicant and the deceased person, including the nature and duration of the relationship
The Plaintiff lived at home with her parents until about 1984, when she was about 20 years old.
Later, "[a]fter the house was built on 178", the Plaintiff saw her parents on "almost a daily basis", except when she had a falling out with her mother and did not speak to her for a "considerably [sic] time".
Overall the Plaintiff described her relationship with her father as being "close", although elsewhere she wrote that "I had a good relationship with my father up until the time he decided to change his will".
In an affidavit read by the Defendants, the deceased's sister-in-law, Gladys Peacock, deposed that "[i]t was my observation from our shared activities and conversations that [the Deceased] was especially fond of Donna and he doted on her".
Evidence of the closeness of their relationship is also revealed by the fact that the deceased appointed the Plaintiff and the second Defendant as his attorneys in August 2013.
Having heard all of the evidence, I am satisfied that both the Plaintiff and the second Defendant each had a close relationship with both the deceased and Margaret for most of their lives. Importantly, the deceased did not attribute any differentiation between his children based upon his relationship with her or with him respectively. (b) the nature and extent of any obligations or responsibilities owed by the deceased person to the applicant, to any other person in respect of whom an application has been made for a family provision order or to any beneficiary of the deceased person's estate
There is no definition of the words "obligations" or "responsibilities" to which the sub-section refers to in the Act. Each word is to be understood in its ordinary, grammatical meaning as the condition of being morally or legally bound.
The responsibility of a testator was expressed by Lord Romer in Bosch v Perpetual Trustee Co Ltd at [478]-[479]: "Their Lordships agree that in every case the Court must place itself in the position of the testator and consider what he ought to have done in all the circumstances of the case, treating the testator for that purpose as a wise and just, rather than a fond and foolish, husband or father. This no doubt is what the learned judge meant by a just, but not a loving, husband or father."
Yet, the Act does not expressly refer to, or identify, any "moral duty". However, what is to be considered is the nature and extent of any legal, or moral, obligations or responsibilities to not only the applicant, but also to the beneficiary or beneficiaries. There is a balancing of potentially competing obligations.
Leaving aside any obligation, or responsibility, arising as a result of their relationship as parent and child, the deceased did not have any legal obligation to each of his children, once they become adults, imposed upon him by statute or common law. (There is no suggestion of any promise of testamentary benefaction having been made or that the Plaintiff, to the knowledge of the deceased, changed her position in the expectation of an inheritance.)
Yet, an obligation or responsibility to make adequate provision for the proper maintenance, education or advancement in life, is recognised in the case of a child. In Flathaug v Weaver [2003] NZFLR 730 at [32], the origin of the obligation which underpins the recognition of the duty owed by a parent to a child in the equivalent Act in New Zealand was put in this way: "The relationship of parent and child has primacy in our society. The moral obligation which attaches to it is embedded in our value system and underpinned by the law. The Family Protection Act recognises that a parent's obligation to provide for both the emotional and material needs of his or her children is an ongoing one. Though founded on natural or assumed parenthood, it is, however, an obligation which is largely defined by the relationship which exists between parent and child during their joint lives."
It should also be remembered that "[a]lthough the relationship of parent and child is important and carries with it a[n]… obligation reflected in the … Act, it is nevertheless an obligation largely defined by the relationship which actually exists between parent and child during their joint lives": Vincent v Lewis [2006] NZFLR 812 at [81]. The boundaries of that obligation or responsibility are not amenable to rigid definition.
There is no "presumptive testamentary entitlement of an offspring": Underwood v Gaudron [2015] NSWCA 269 at [73] (Basten JA).
The size of the deceased's estate is also relevant to determining the extent of the obligation or responsibility. (c) the nature and extent of the deceased person's estate (including any property that is, or could be, designated as notional estate of the deceased person) and of any liabilities or charges to which the estate is subject, as in existence when the application is being considered
I have earlier dealt with these matters. The net value of the estate is relatively small. (d) the financial resources (including earning capacity) and financial needs, both present and future, of the applicant, of any other person in respect of whom an application has been made for a family provision order or of any beneficiary of the deceased person's estate
The Plaintiff sets out her financial and material circumstances as follows: Asset Approximate $ amount No 178 670,000 2011 Hyundai Hatch back car 8,000 450 Telstra shares 2,250 Newcastle Permanent Savings Account balance 28,000 Total 708,250

Of course, that estimate of value does not include the provision made for the Plaintiff under the Will of the deceased (if she were to receive the legacy of $50,000). The Plaintiff has no superannuation.
The Plaintiff has the following amounts in bank deposits which are said to be hers and Gregory's: Police Bank term deposit $40,000 Police Bank term deposit $10,000 Police Bank Savings Account $25,000 Total $75,000

The Plaintiff, thus, currently, has assets with a value of $708,250 in her own name (which would increase by $50,000 if she received the legacy payable to her under the Will of the deceased) and $75,000 jointly with her husband.
The Plaintiff sets out Gregory's assets as follows: Asset Approximate $ amount Avan Ovation Motor Home 120,000 Xxx xxx xxx Stockton 665,000 5,000 Nib shares 15,000 2,448 BP shares 19,000 x xxxxx xxxx Pelaw Main (1/2 interest as tenant-in-common with brother) 160,000 Superannuation (BP/Lowes) 88,000 Total $1,067,000

The Plaintiff's husband's liabilities are as follows: Liability Approximate $ amount Mortgage - Stockton property - Newcastle Permanent 678,000 Mortgage - Pelaw Main - Macquarie Bank 120,000 Motor Home loan - Newcastle Permanent 145,000 Total $943,000

Whilst the assets in her husband's name are of greater value, his liabilities are significant. He currently receives $2,462 income per week (from his police pension, wages from Lowes Petroleum, and rental income from the Stockton and the Pelaw Main Properties), so their combined income is currently sufficient to cover their estimated expenditure of $1,332 per week (even after paying her husband's $1,100 per week on all three investment properties). Indeed, they are comfortable enough in meeting their own basic needs that their weekly expenditure includes providing $200 to their adult married daughter to help support her while she studies in New York, as well as providing financial support to their adult son who recently finished university and is looking for full-time work
Yet, the Plaintiff's husband's income from employment - currently comprising wages of about $650 per week - is said to be precarious, as he has been informed that his 12 month contract will not be renewed. He believes that his poor physical health (torn ligaments in both shoulders and Dupuytren's contracture in both hands, ligament damage in his left foot, a large prolapsed disc in his spine at L5 and tinnitus in his right ear) will prevent him from finding new employment and that he may retire. Without his wage from employment, he and the Plaintiff would have a combined income of $1,815 per week, leaving them with a shortfall of $620 per week, based on their current expenditure. (Of course, part of this expenditure is incurred in respect of property that is negatively geared. Gregory gave evidence that he only contributes about $100 per month to the Stockton property because the income received from the Pelaw Main property is sufficient to meet the outgoings on it: T41.)
When asked about her future plans and the prospect of moving to the Newcastle area, the Plaintiff said "I really don't know what we are doing at the moment until this is all sorted out": T28. However, she admitted that "downsizing" may be an option.
However, Gregory gave evidence that the Stockton property had been purchased with the intention to move there and that he and the Plaintiff would move there "as soon as the [vendors] move out". He also said that one option would be to sell No. 178 and for the Plaintiff to use the proceeds of sale to pay out the mortgage on the Stockton property: T43-T45.
The Defendant outlines his, and his wife's, assets and liabilities as follows: Assets Estimated Value
Jointly owned home at xx xx xxx, Belmont North $350,000.00
Rural land at Eumungerie $200,000.00
Haines Hunter runabout boat (circa 1980 model) $6,000.00
Aluminium Tinny $500.00
2000 Toyota Hilux (with 370,000 km) $2,500.00
2008 Ford Falcon BF sedan $4,000.00
Brett's Newcastle Permanent Bank account $500.00
2000 Shares with IM Medical (at $0.001 each) $nil
222 Shares with Millennium Minerals (at $0.03 each) $6.00
Melissa's savings accounts with Newcastle Permanent Building Society $15,000.00
Melissa's NIB Shares (1600) $5,500.00
Melissa's IAG shares (520) $3,000.00
Brett's superannuation with Australian Super $136,000.00
Melissa's superannuation with Australian super $43,900.00
Melissa's superannuation with AMP $8,500.00

Liabilities 16. Newcastle Permanent Building Society mortgage debt $208,000 Total $567,406

However, in cross-examination the second Defendant conceded that the Belmont North property was probably worth $400,000. He also acknowledged that he owned a tractor (purchased second hand for $6,800), 48 sheep (which the second Defendant suggested were worth about $100 each) and a gazetted road in Eumungerie (for which he paid $5,500) that were not declared on his list of assets. If the value of these additional assets is included, then their total assets are approximately $631,000. However, the second Defendant gave evidence that the amount of $15,000 (which was in Melissa's savings account) had been spent on their daughter. It follows that the total value would be $616,000.
Of course, that estimate of value does not include the provision made for the second Defendant under the Will of the deceased.
The second Defendant is employed full-time as a fitter and machinist and has an income, after tax, of about $1,100 a week. He has been on reduced duties following an injury suffered in July 2015. If he returns to his previous role after recovering he will then earn about $1,480 a week after tax. While the second Defendant runs sheep on his land in Eumungerie he insisted that this is not an income producing asset. His wife, Melissa, currently works three days a week as a laboratory aide and earns about $500 a week. It follows that the second Defendant and his wife, currently have a combined income of about $1,600 a week.
The Defendant and his wife support two minor children, Ella and Ryan, currently aged about 16 years and 13 years respectively. Ryan needs to have treatment for an eye problem which will cost $800 for the initial treatment and then $180 for each ongoing visit, which they have been informed will be required "indefinitely". Ryan also has learning difficulties and requires special tuition, although no cost estimate for that tuition was provided. Both children also require braces, with Ella's alone estimated to cost $5,000. Melissa suffers from carpal tunnel syndrome which requires surgery, which she says she has been unable to undergo as the family cannot afford for her to take time off work. (e) if the applicant is cohabiting with another person-the financial circumstances of the other person
The Plaintiff is currently cohabiting with her husband. I have set out his financial circumstances earlier.
In about 2014, the Plaintiff and Gregory separated, but by the time of the hearing they were reconciled and were living together again. She was hopeful that their marriage, which is of about 30 years duration, will survive. (f) any physical, intellectual or mental disability of the applicant, any other person in respect of whom an application has been made for a family provision order or any beneficiary of the deceased person's estate that is in existence when the application is being considered or that may reasonably be anticipated
In about 1996, the Plaintiff received an electric shock that caused permanent loss of hearing in her right ear and loss of strength in her right arm. The Plaintiff also suffers from osteoarthritis (which she says makes it difficult for her to walk up stairs), tachycardia, hypertension, type 2 diabetes and, since about 2013, depression. Further, she has recently been diagnosed with rheumatoid arthritis.
The second Defendant also suffers from poor health, having injured his arm at work in July 2015. He takes regular medication for a hiatus hernia (having done so for the past six years), he has a torn meniscus in his right knee which causes him pain in everyday work activities, and tennis elbow in the left arm (for which he takes anti-inflammatory medication). He has suffers from low back pain and has to regularly got to the physio at a cost of $60 per visit. (g) the age of the applicant when the application is being considered
The Plaintiff is currently 52 years old. (h) any contribution (whether financial or otherwise) by the applicant to the acquisition, conservation and improvement of the estate of the deceased person or to the welfare of the deceased person or the deceased person's family, whether made before or after the deceased person's death, for which adequate consideration (not including any pension or other benefit) was not received, by the applicant
The Plaintiff gives evidence of the contributions made to the deceased. After 1994, Gregory was regularly asked to help the deceased around the property, including mending fences and mowing laws. He also assisted the deceased with his business of selling firewood and surveyor pegs by cutting and carting the firewood. (Even though the contribution identified was not by the Plaintiff, it is relevant).
According to the Plaintiff, for about four years after her mother went into a nursing home, she did the shopping for the deceased, cooked his meals, cleaned his house, took him to doctor's appointments, collected his medication, and helped him care for his dog. (i) any provision made for the applicant by the deceased person, either during the deceased person's lifetime or made from the deceased person's estate
I have referred to the provision made by the deceased earlier.
In addition, the deceased helped the Plaintiff build her first home at Windermere Park, he having "supplied and cut the timber for the frame and erected the frame himself and organised other trades to complete the construction".
Senior counsel for the Defendants put to the Plaintiff that had she not become the registered proprietor of No. 178 in 1997 and moved into the Pink House, she and Gregory would have found it a struggle financially since she was not in paid employment. Although she denied that, I am satisfied that being able to live in the Pink house, rent and occupation fee free, did provide a significant benefit to her. In addition, the ability to rent the Pink House and to derive an income from it, thereafter (until the death of the deceased) did provide her with a substantial benefit. (I have not forgotten the Plaintiff's evidence that she only rented the Pink House "from time to time".)
The deceased also provided ongoing assistance to the second Defendant. Specifically, he gave the second Defendant timber for a building, paid about $6,000 to erect a fence at his property in Eumungerie, and paid about $4,000 to purchase a 2000 Toyota Hi-Lux vehicle. The deceased also gave the second Defendant financial assistance to purchase the second hand tractor for $6,800.
Although counsel for the Plaintiff cross-examined the second Defendant on an amount of $18,000 which she asserted had been advanced by the deceased to him to complete the purchase of the Eumungerie property, the second Defendant denied that was so. However, he could not identify the source of that amount. (j) any evidence of the testamentary intentions of the deceased person, including evidence of statements made by the deceased person
The deceased made a Will in October 2005, in which he appointed Margaret as the sole executrix. He left his tools to the second Defendant and after the payment of debts, funeral and testamentary expenses, left the whole of the residue of his estate to Margaret absolutely provided that she survived him by 30 days. In the event that she did not, he left the residue of his estate to the Plaintiff and the second Defendant as tenants in common in equal shares.
The deceased made a Will in April 2013, in which he appointed the Defendants as the executors. He gave a pecuniary legacy of $50,000 to the Plaintiff and after the payment of the debts funeral and testamentary expenses left the whole of the residue of his estate to the second Defendant.
In the April Will, Clause 5 was in the following terms: "I DECLARE that it is my wish to treat each of my children fairly. My aforesaid daughter has already received substantial benefit from me during my lifetime. In or about 1997 I gifted my daughter all of my estate in the real property known as Part 178 XXX Morisset and being Lot 2 in DP XXXX. My daughter has derived benefit from this gift as the property has been her home. To achieve my aim to treat both children fairly I DECLARE that my son should receive, by way of inheritance, my home at 168 XXX Morisset being Lot 3 in DP XXXX."
I have earlier referred to the deceased's last Will which he made on 2 May 2013. Clause 5, set out above, was not included. (k) whether the applicant was being maintained, either wholly or partly, by the deceased person before the deceased person's death and, if the court considers it relevant, the extent to which and the basis on which the deceased person did so
The Plaintiff was not being maintained, either wholly or partly, by the deceased before his death. Indeed, it appears that she was financially independent of the deceased for many years prior to his death. (l) whether any other person is liable to support the applicant
Other than Gregory, there is no person with a legal obligation to support the Plaintiff. She did not give any evidence of her entitlement to receive an age, or other form of pension, now or in the future. (m) the character and conduct of the applicant before and after the date of the death of the deceased person
An evaluation of "character and conduct" may be necessary, not for the sake of criticism, but to enable consideration of what is "adequate and proper" in all the circumstances. Importantly, the Act does not limit the consideration of "conduct" to conduct towards the deceased.
In Collicoat v McMillan at [40], Ormiston J wrote, in relation to the manner in which an applicant's behaviour towards the deceased is to be considered: "Ordinarily each of the persons who have a statutory right to make [an] application are entitled to have their position considered by a testator but their behaviour (right or wrong) towards the testator may only provide a basis for measuring appropriately the testator's obligation to make provision for each of those applicants. Their sins are irrelevant except in so far as a testator might properly take exception to their behaviour."
There is no conduct of the Plaintiff that is relevant. (n) the conduct of any other person before and after the date of the death of the deceased person
I am satisfied that there is no conduct of the Defendant that impacts on the determination of what provision should be made for the Plaintiff out of the estate of the deceased. I remember, of course, that he is one of the chosen objects of the deceased's bounty. He is also a child of the deceased. (o) any relevant Aboriginal or Torres Strait Islander customary law
This factor is not applicable. (p) any other matter the court considers relevant, including matters in existence at the time of the deceased person's death or at the time the application is being considered
There is no other matter that I consider relevant.

Determination

Being an "eligible person" is a necessary precondition to the Court being empowered to make an order for the maintenance, education or advancement in life of the applicant. There is no dispute the Plaintiff, as a child of the deceased, is an eligible person within the meaning of that term in s 57(1)(c) of the Act.
I have referred to the apparent error in the deceased's instructions provided to the first Defendant. This misunderstanding, apparent from the estimate of the value of the interest "given to" the Plaintiff, and the methodology that the deceased adopted using the mistaken value, is relevant to the Court's consideration. Yet, the decision for the Court depends upon what is "adequate" and "proper". Ultimately, the deceased's methodology, whether correct or not, is not decisive of the result of the issues the Court must determine.
Although the Plaintiff has assets of reasonable value, those assets being unencumbered, her personal ability to earn income is very limited, as she has no formal qualifications; she has not worked since 1986; and because she suffers from several physically disabling health problems. Currently, her only income is $290 a week from the Pink House. She also has no superannuation.
If she were to sell No. 178, the income that the net proceeds of sale would generate, might result in more than $290 per week. However, she would no longer have the security of accommodation that she now has.
If she and Gregory were to move to the Stockton property owned by Gregory, it may be that the Plaintiff could rent the house on No. 178 in which they currently live. Gregory thought that the Plaintiff might be able to rent it out for about $400 per week. If this were done, and they moved, the total income from No. 178, if so utilised by the Plaintiff, could be used to service the mortgage on the Stockton property. In this way, the Plaintiff would retain No. 178 as her own, and, so long as both homes on it were rented, and the Plaintiff used the rent to service the mortgage on the Stockton property, she would be secure in that accommodation (even if Gregory had to contribute a little more to make the mortgage repayments). (Somewhat surprisingly, neither the Plaintiff nor Gregory could tell me the amount of the current monthly repayment on the Stockton investment property mortgage.) Alternatively, the Plaintiff would receive almost $700 gross per week from which to support herself or otherwise contribute to the family's finances.
Counsel for the Plaintiff submitted that I should not speculate on what the Plaintiff and her husband might do. That is correct, but I must determine the case on the balance of probabilities at the date of the hearing. Having heard the Plaintiff and Gregory, I am satisfied that it is more probable that the Plaintiff will move, with Gregory, to the Stockton property; and that she will not sell No. 178, but will rent both houses on No. 178, thereby receiving an income of about $700 gross per week. I also consider it likely that if they do this, the Plaintiff will contribute an amount from the rental income to assist in the payment of the mortgage instalments because the Stockton property will then not provide any rental income.
Alternatively, if Gregory sells the Stockton property and they remain living on No. 178, presumably the proceeds of the Stockton investment property would be utilised to pay out the mortgage debt secured thereon, which would result in no significant diminution of the family income.
A further alternative would be to remain living as they currently are.
In any of those alternatives, the Plaintiff will have a property worth $670,000 which is unencumbered.
On balance, I am not satisfied, for the purposes of s 59(1)(c) of the Act, that the deceased did not make adequate provision for the proper maintenance and advancement of the Plaintiff. It follows that the Court has no jurisdiction to make an order for further provision out of the estate of the deceased.
In coming to the ultimate conclusion that the Plaintiff has not established that the provision made for her in the deceased's Will is inadequate, I have borne in mind all of the matters set out above, and, as submitted by the Plaintiff's counsel, have also borne in mind that the Plaintiff and Gregory could be viewed as a family entity. Important, also, is the size of the deceased's estate, the competing claim of the second Defendant, as well as the importance of the deceased's testamentary intentions.
I test the conclusion that I have reached in another way. If one used the methodology that the deceased identified in his discussions with the first Defendant, using the current value, but remembering that the Plaintiff owned one quarter of No. 178 at the date of transfer, the value of three quarters of No. 178, at the date of hearing, is $502,500. On the estimates previously stated, that is slightly more than the gross value of the estate passing to the second Defendant under the terms of the deceased's Will. I am alert to the fact that the current value of No. 178 is reached after repairs and renovations have been carried out on the Pink House and that there is a second house constructed on the land, the costs of which the Plaintiff and Gregory have paid.
However, if one then deducts from the gross value of the estate, the amount of the Defendants' costs of the proceedings, the amount that the second Defendant is likely to receive is about $411,953. This is about 61.5 per cent of the current value of No. 178. (I remember that the Plaintiff has had the benefit of income, from time to time, since 1997, from the rental of the Pink House, and the provision said to have been made for the second Defendant during the lifetime of the deceased.)
Accordingly, the Summons must be dismissed.
I next consider the question of costs.
Section 98(1) of the Civil Procedure Act 2005 (NSW) provides that subject to the rules of court and to this, or any other Act, costs are in the discretion of the Court. Similarly, UCPR r 42.1 provides that costs should follow the event unless it appears to the Court that some other order should be made as to the whole, or any part of the costs. UCPR r 42.20(1) provides that if the Court makes an order for the dismissal of proceedings, then unless the Court otherwise orders, the plaintiff must pay the defendant's costs of the proceedings to the extent to which the proceedings have been dismissed.
The effect of these rules in this case, is that the Plaintiff must bear the Defendants' costs of the proceedings for the family provision order, unless the Court otherwise orders. The Court can only order otherwise if there is a discretionary decision to depart from what the UCPR provide.
There is no suggestion that the Civil Procedure Act and the UCPR do not apply to family provision proceedings.
I have earlier referred to s 99 of the Act, which section provides for an unfettered discretion as to how the costs of the proceedings for a family provision order may be borne.
In Harkness v Harkness (No 2) [2012] NSWSC 35, I wrote: "I have identified, in a number of other cases in which a family provision order has been sought (see, for example, Smith v Smith (No 2) [2011] NSWSC 1105, Mikan v Velcic (No 2) [2011] NSWSC 505), after referring to the legislation, which I have again set out above, the general principles I considered relevant. For the assistance of the parties and others reading this judgment, I repeat the principles stated previously which I consider relevant to the present case: (a) In Singer v Berghouse [1993] HCA 35; (1993) 114 ALR 521, Gaudron J, said, at 522: "Family provision cases stand apart from cases in which costs follow the event. Leaving aside cases under the Act which, in s.33, makes special provision in that regard, costs in family provision cases generally depend on the overall justice of the case. It is not uncommon, in the case of unsuccessful applications, for no order to be made as to costs, particularly if it would have a detrimental effect on the applicant's financial position. And there may even be circumstances in which it is appropriate for an unsuccessful party to have his or her costs paid out of the estate." (b) Despite the above statement, which, of course, was written in the context of a security for costs application, and in respect of proceedings under the Family Provision Act, s 99 of the Succession Act provides a wide discretion in relation to costs ("in such manner as the Court thinks fit"). (c) The view of some practitioners advising a potential applicant contemplating a claim for a family provision order, that there is little risk, and probably much to be gained, in making a claim, however tenuous, because even if the claim fails the applicant will, very likely, get his, or her, costs out of the estate and that he, or she, will not be significantly out of pocket, and the legal practitioner will receive his, or her, costs and disbursements in any event, has been thoroughly discredited. (d) Parties should not assume that this type of litigation can be pursued, safe in the belief that costs will be paid out of the estate: Carey v Robson (No 2) [2009] NSWSC 1199; Forsyth v Sinclair (No 2) [2010] VSCA 195. It is now much more common than it previously was for an unsuccessful applicant to be ordered to pay the defendant's costs of the proceedings (Lillis v Lillis [2010] NSWSC 359 at [23]) and be disallowed his, or her, own costs. (e) Where, as here, the issue is whether the unsuccessful applicant should bear the costs of the successful Defendant, s 98 of the Civil Procedure Act, and the rules quoted above, will apply, and, in the absence of some good reason to the contrary, there should be an order that the costs of the successful defendant be paid by the unsuccessful plaintiff: Moussa v Moussa [2006] NSWSC 509 at [5]. (f) An unsuccessful plaintiff will, usually, be ordered to pay costs where the claim was frivolous, vexatious, made with no reasonable prospects of success, or where she, or he, has been guilty of some improper conduct in the course of the proceedings: Re Sitch (No 2) [2005] VSC 383. (g) In small estates particularly, the court should be careful not to foster the proposition that obstinacy and unreasonableness will not result in an order for costs: Dobb v Hacket (1993) 10 WAR 532, at 540. (h) Proceedings for a family provision order involve elements of judgment and discretion beyond those at work in most inter partes litigation: Jvancich v Kennedy (No 2) [2004] NSWCA 397; Re Sherborne Estate (No 2); Vanvalen v Neaves [2005] NSWSC 1003. (i) In exercising its discretion in relation to costs, the court will have regard to "the overall justice of the case": Jvancich v Kennedy (No 2). The "overall justice of the case" is "not remote from costs following the event". However, the court may be more willing to depart from the general principle in proceedings for a family provision order than in other types of case: Moussa v Moussa; Carey v Robson (No 2); Bartkus v Bartkus [2010] NSWSC 889 at [24]. (j) As proceedings for a family provision order are essentially for maintenance, a court may properly decide to make no order for costs, even though it were otherwise justified, against an unsuccessful applicant, if it would adversely affect the financial position which had been taken into account in dismissing the application: Morse v Morse (No 2) [2003] TASSC 145; McDougall v Rogers; Estate of James Rogers [2006] NSWSC 484; McCusker v Rutter [2010] NSWCA 318 at [34]. (k) There are also other circumstances that may lead the court to order payment out of the estate of the costs of an unsuccessful Plaintiff. The court may allow an unsuccessful plaintiff costs out of the estate, if in all the circumstances the case was meritorious, reasonable or "borderline": McDougall v Rogers; Estate of James Rogers; Re Bodman [1972] Qd R 281; Shearer v The Public Trustee (NSWSC, Young J, 21 April 1998, unreported). Finally, what I said in Smith v Smith (No 2) at [77], is also applicable to the facts of the present case: "I commend to parties involved in proceedings in which a family provision order is sought, that every effort, particularly in a relatively small estate, as this one is, to conduct negotiations frankly and openly, to try to resolve the proceedings, and if there are issues or concerns about an offer that has been made, to raise any issues at the first convenient opportunity with the offeror's solicitors, so that any ambiguities, or other concerns, can be resolved. The Court should be able to see that the parties have considered what is being offered in a sensible, practical, and commercial way."
In Bruce v Greentree (No 2) [2015] NSWSC 1636 at [43], I wrote: "In addition to the above principles, I should note that the usual costs rule in an unsuccessful family provision application "reflects the policy embodied in s 56 Civil Procedure Act that litigation must be conducted responsibly and should only be commenced by a plaintiff after careful evaluation of the costs consequences likely to attend to failure": Carey v Robson; Nicolls v Robson (No 2) [2009] NSWSC 1199, per Palmer J, at [20], and that "[t]here is a public policy in the usual practice as well as the element of justice reflected in the rule that costs follow the event": Friend v Brien (No 2) [2014] NSWSC 614, per White J, at [20]."
Had she not commenced these proceedings, the Plaintiff would have received a legacy of $50,000, which amount would have provided a lump sum for the exigencies of life. As it is, by commencing proceedings she took the risk that she would not receive an order for her costs out of the estate or that she would have to bear the burden of the Defendants' costs.
I also remember that in defending the proceedings, the Defendants were endeavouring to protect the second Defendant's financial interests only. There was no other person entitled to any part of the residue of the deceased's estate.
With some hesitation, I am of the view that the overall justice of the case requires no order for the Plaintiff to bear the burden of the Defendants' costs since that would impact so adversely on her financial position. To do so, and make to no order as to her own costs being paid out of the estate, would, in all probability, result in the Plaintiff having to sell No. 178. I do not think that this would, in all the circumstances of the case, be a just result. I have earlier referred to the Plaintiff's lack of superannuation and her limited earning capacity.
Yet, I do not think that I should order that the estate to bear the burden of the Plaintiff's costs. This would not be a just result either, as a significant amount of costs, even if capped, would have to be paid out of the estate. As I have written elsewhere, "[A]n application for a family provision order ought not to be launched unless there is, or there appears to be, a real chance of success, because the result of the proceedings simply diminishes the estate and notional estate and is a significant hardship on those beneficiaries entitled if the applicant is ultimately unsuccessful in the litigation": Bruce v Greenetree (No. 2) at [57].
Accordingly, the Court: 1. Orders that the Summons be dismissed. 2. Makes no order as to the Plaintiff's costs to the intent that she is to bear her own costs of the proceedings. 3. Orders that the Defendants' costs, calculated on the indemnity basis, of the proceedings be paid or retained as the case may be out of the estate of the deceased. 4. Orders that the Exhibits should be dealt with in accordance with the Uniform Civil Procedure Rules 2005.

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: 21 April 2016

Family Provision Act 1982(NSW)

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