Supreme Court of WA|2004-05-07|Before: Barker J

Perpetual Trustees WA Ltd (As Executor of the Estate of Eleanor Anne Seward (Dec)) v Riverwest Pty Ltd & Ors [2004] WASC 81 (7 May 2004)

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

CITATION : PERPETUAL TRUSTEES WA LTD (As Executor of the Estate of ELEANOR ANNE SEWARD (Dec)) -v- RIVERWEST PTY LTD & ORS [2004] WASC 81

BETWEEN : PERPETUAL TRUSTEES WA LTD (As Executor of the Estate of ELEANOR ANNE SEWARD (Dec))

Succession - Will - Construction - Devises of portions of single lot - Whether devises void for uncertainty - Portions of land not "lots" as defined in Town Planning & Development Act 1928 (WA) - Proscription against unapproved subdivision - Whether plaintiff holds land in trust - Trustee's obligation to subdivide - Whether certain assets belong to estate

Asten v Asten [1894] 3 Ch 260

Boyes v Cook (1880) 14 Ch D 53

Hiscocks (Dec) v Hiscocks [1839] EngR 65; (1839) 5 M&W 363

Horton v Public Trustee [1977] 1 NSWLR 182

National Society for Prevention of Cruelty to Children v Scottish National Society for Prevention of Cruelty to Children [1915] AC 207

O'Connor v O'Connor (1870) 4 IR Eq 483

Olsen v Olsen [1977] 1 NSWLR 189

Pearce v Pearce [1977] 1 NSWLR 170

Public Trustee as Administrator of the Estate of Houden (Dec) v Houden [1999] WASC 85

Re Lewis' Will Trusts; Lewis v Williams [1984] 3 All ER 930

Re Marchetti; Perpetual Executors Trustees & Agency Co Ltd (WA) v Marchetti (1950) 52 WALR 20

Re Mulder; Westminster Bank Ltd v Mulder [1943] 2 All ER 150

Rennes v Death [2003] NSWSC 708

Timber Top Realty Pty Ltd v Mullens [1974] VicRp 39; [1974] VR 312

Wood v Browne [1984] 2 Qd R 593

1 By originating summons dated 20 September 2002, the plaintiff, as executor and trustee of the Will and estate of Eleanor Anne Seward, deceased, seeks directions and consequential orders with regard to:

(1) the construction and interpretation of the devises and bequests made by the deceased by her Will dated 22 July 1997 as amended by codicil dated 9 September 1997;

(2) the administration, distribution and application of the deceased's real and personal estate; and

(3) the costs of and incidental to the application.

2 By application dated 25 August 2003, the first defendant (Riverwest Pty Ltd) also seeks orders on the hearing of the originating summons as follows:

(1) a determination from the Court that 4556 Coca Cola Amatil shares were held on trust by the deceased for the Eleanor Anne Seward Trust (the Trust); and

(2) if the Court is satisfied that the shares were held on trust by the deceased for the Trust, a declaration from the Court to that effect and consequential directions to transfer the shares from the plaintiff to the first defendant.

3 In the context of the plaintiff's originating summons, it appears to me that the issues raised by the first defendant arise as additional issues pertaining to the proper construction of the Will of the deceased or the administration of her estate and should also be resolved in the current proceedings.

The cl 3.1 devises in respect of portions of Lot 366 Horsley Road, Denmark

4 Probate of the Will and one codicil of the deceased, who died on 25 April 2001 was granted to the plaintiff on 7 August 2001. By her Will, the deceased made various bequests, legacies, and, in some cases, devises to family members, including her children and grandchildren, as well as to a number of other persons.

5 The manner in which the deceased went about making her Will discloses the perils of a person attempting to make their own Will without professional assistance where the estate to be affected by the Will constitutes many parts, the number of beneficiaries in mind are numerous and considerations of some legal complexity are involved. While the deceased took the precautionary step of instructing her solicitors to prepare her Will, no doubt because of these various matters, in the end she chose to make alterations to a draft Will prepared by her solicitors and to execute it without taking their further legal advice.

6 The alterations concerned purported devises of land which comprised portions of Lot 366, Horsley Road, Denmark, Western Australia. By her handwritten amendments to the typewritten draft of the Will, the deceased altered the draft by inserting a number of devises of a portion of Lot 366 and apparently making the devise an alternative to a pecuniary legacy, save in the case of one beneficiary. In its altered form, the Will was admitted to probate.

7 For example, cl 3.1(a)(i) of the draft provided the following pecuniary legacy to the deceased's son, Michael Giles Seward (the second defendant):

However, when she executed her Will the deceased wrote adjacent to that legacy, the additional words:

"or 1-1 acre (approx) block on Lot 366, Horsley Road DENMARK 6333;"

8 Handwritten alterations were also made to the draft by the deceased in respect of pecuniary legacies made in favour of: her daughter, Angela Margaret Seward (the fourth defendant) (cl 3.1(c)(iii)); her son, Peter Maurice Seward (the fifth defendant) (cl 3.1(d)(i)); her son, James Patrick McCarthy Seward (the sixth defendant) (cl 3.1(e)(i)); her cousin, Christina (Giles) Lyall (the eighth defendant) (cl 3.1(f)(ii)); her cousin, Kate Virginia (Giles) Sutherland (who is not a party to these proceedings) (cl 3.1(g)(i)); Bishop Peter Quinn for Saint Mary's Catholic Church, Denmark (who is not a party to these proceedings) (cl 3.1(h)(i)); Jacqueline Rita Priestley (nee Boyes) (who also is not a party to these proceedings) (cl 3.1(i)(i)); Scott Lachlan Seward (who also is not a party to these proceedings) (cl 3.1(k)(i); Timothy Michael Seward (who also is not a party to these proceedings) (cl 3.1(l)(i)); and Leo Jerome Seward (who also is not a party to these proceedings) (cl 3.1(m)(i)).

9 In the cases of Angela Margaret Seward and Scott Lachlan Seward respectively, a legacy of $120,000 was amended by providing the apparent alternative:

"or 2 Blocks - 1 acre each on Lot 366 Horsley Road DENMARK 6333."

10 In the case of Timothy Michael Seward and Leo Jerome Seward respectively, the deceased appeared to amend a pecuniary legacy of $30,000 to each by providing the alternative:

"1/2 share in 1 Block 1 acre (approx) on Lot 366 Horsley Road DENMARK 6333."

The word "or" was not inserted as in the other cases.

11 In all other cases, the deceased, as in the case of her son, Michael, amended a pecuniary legacy of $60,000 by providing the apparent alternative:

"or 1 - 1 acre (approx) block on Lot 366 Horsley Road DENMARK 6333."

12 As to the deceased's daughter, Kathryn Mary Seward (the third defendant), a materially different pecuniary legacy and bequest and devise was made in cl 3.1(b) of the Will. As this clause appeared in the draft, it relevantly provided:

(i) a sum of $120,000.00;

(ii) 1 Gilt Medal from Sir Norman Giles K.B. (grandfather) - 1969 plus pine log house and also 1 acre of land upon which it is located on the 17 acres of the land at Lot 366 Horsley Road, Denmark and its contents if I own the land at my death."

However, at the time she executed her Will, the deceased altered cl 3.1(b)(ii) in handwriting in the following manner:

(a) first she underlined the words "1 acre of land";

(b) then immediately above the words, "upon which it is", she wrote, "approx 1 Block".

13 Thus, in the case of Kathryn, the Will does not make the purported devise of a portion of Lot 366 an alternative to the pecuniary legacy referred to in cl 3.1(b)(i) or to any of the bequests (that is, the Gilt Medal and the contents of the house).

14 The parties accept that the handwritten notations on the Will of the deceased form part of the Will and codicil, probate having been granted to the Will: In re Barrance; Barrance v Ellis [1910] 2 Ch 419. The only questions that now arise concern the construction and validity of the clauses affected by the handwritten amendments to the typewritten draft of the Will.

15 So far as construction of the Will is concerned, it is well established that the Court is required to give the words used in the Will their ordinary meaning and if there remains some difficulty of construction, to have regard to any surrounding circumstances that may shed light on the proper meaning of the words. In In re Hodgson; Nowell v Flannery [1936] 1 Ch 203 at 206 Farwell J said of the Court's duty:

"I think that it comes to this: the duty of the Court in the first place is to read the will itself. The Court is bound in the first instance to read it, giving the words used their primary and proper meaning. The Court is then entitled to look at the surrounding circumstances. If the surrounding circumstances are such that the words of the will, if construed in accordance with their primary meaning, are not apt to apply to any of the circumstances, then the Court is entitled, having regard to the surrounding circumstances, to see whether the language used is capable of some meaning other than its ordinary meaning, not for the purpose of giving effect to what the Court may think was the intention of the testator, but for the purpose of giving effect to what the intention of the testator is shown to be from the language which used having regard to the surrounding circumstances. In other words, the Court is not entitled to disregard the language which the testator has used in order to give effect to what the Court may think to have been the intention, but the Court is entitled to say that the words which the testator has used were not intended to have their primary meaning if the surrounding circumstances are such as to lead inevitably to that conclusion."

16 "Williams on Wills", 8th ed, Butterworths (2002), vol 1 at 586 summarises the functions of the Court in this way:

"The meaning of the will is dependent upon the intention of the testator and in the court of construction the primary evidence of the testator's intention is the will itself [footnote omitted], but extrinsic evidence of circumstances may be given the nature and effect of which is to explain what the testator has written [footnote omitted], but not what he intended to write [footnote omitted but includes reference to In re Hodgson (supra).] Thus, extrinsic evidence is admissible to make intelligible something in the will which without that evidence would not be intelligible [footnote omitted]."

17 The Wills Act 1970 (WA) also provides some rules governing the construction of Wills. Most relevantly to the present circumstances, s 26 of the Wills Act provides that:

"Unless the contrary intention appears by the will -

(a) the will is to be construed, with reference to the property comprised in it, to speak and take effect as if it has been executed immediately before the death of the testator;"

18 In this case, the first question of construction that arises is as to the meaning of the handwritten purported devises made in cl 3.1 of the Will, other than that to Kathryn in cl 3.1(b).

19 First, I should say I consider that in each of these cases the Will should be construed as providing a pecuniary legacy to the named beneficiary or, in the alternative, a devise of a portion of Lot 366 Horsley Road, Denmark. In those cases where the word "or" does not appear before the handwritten amendment, it is abundantly clear from a perusal of the whole of the Will that the purported devise is intended as an alternative to the pecuniary legacy adjacent to it.

20 Immediately before her death, the deceased was registered as the proprietor of an estate in fee simple in Denmark Lot 366, being the whole of the land comprised in certificate of title vol 1772 folio 883, on which stood a pine log house. The land is generally described by its street address of Lot 366 Horsley Road, Denmark. It is situate at the corner of Rockford Road and Horsley Road, Denmark.

21 At all material times, both when the Will was made by the deceased and immediately before her death, as well as when the Will was received into probate, Lot 366 comprised one single, unsubdivided "lot", as that term is defined by s 2 of the Town Planning and Development Act 1928 (WA).

22 Immediately prior to the death of the deceased, Lot 366 was zoned rural under the relevant Shire of Denmark town planning scheme. However, it was also within both the area considered by the Denmark Residential Strategy Review dated December 1996 and the area identified as Planning Unit A by the Settlement Strategy for Denmark adopted by the Shire in 1998. In the Settlement Strategy, Lot 366 and four adjoining lots were identified as Planning Unit A, a favoured location for the extension of residential housing lots in Denmark.

23 In August 2001 (soon after the deceased's death), Mr R K Snowball, a licensed valuer, ascertained from an officer of the Shire of Denmark, that, from the Shire's point of view, the land within Planning Unit A was a favoured location for closer subdivision under Residential R20 density code, which would permit the eventual subdivision of that land into minimum 450 m2 lots with an average size of 500 m2. However, Mr Snowball also learned that, before the land within Planning Unit A could be rezoned and subdivided, the Shire would require the preparation of a Structure Plan which would need to be approved by the State Planning Commission, the Shire and all other relevant authorities.

24 Mr Snowball also learned that the subdivision of the land could not be considered certain as there were several obstacles to overcome, including the removal of a buffer zone surrounding a vineyard, which was a permitted use located on two of the other lots within Planning Unit A, being Lots 50 and 51.

25 Mr Snowball noted the view of the officer of the Shire that a subdivision of Lot 366 alone was not an option without an overall Structure Plan in place for all of the land within Planning Unit A. The particular reason for this view was the need to provide for drainage discharge from Lot 366 through adjoining Lot 365, the only likely drainage option.

26 In about August 2001, Mr Snowball also ascertained from a Mr Richard Pawluk of Melvista Park Pty Ltd, the registered proprietor of Lot 372, another lot within Planning Unit A, that the task of achieving rezoning and subdivision of the land within Planning Unit A was not free from difficulty, because the owners of the land within Planning Unit A would first need to reach some agreement concerning the costs of completing the Structure Plan and this, in turn, would require the resolution of differences between owners on lot sizes, open space allocation, drainage location, road realignment and the like.

27 In the light of this information Mr Snowball, an experienced valuer of land, expressed the view:

"After evaluating the status of the re-zoning and possible subdivision it is most apparent that final subdivision approval is still a long way off even though the prospects appear good."

28 There is nothing in the express terms of the Will or codicil that suggest the deceased at the time of her death was aware of the particular subdivision potential of Lot 366 in the manner and detail suggested by Mr Snowball's evidence, although the fact that by her Will the deceased purported to gift 13 "blocks" on Lot 366 may suggest that she had some appreciation of the subdivision potential of Lot 366.

29 However, extrinsic evidence going to the circumstances in which the deceased made her Will suggests she was well aware of the Shire's views on subdivision and that, through the first defendant, she had indeed contemplated a particular plan of subdivision of Lot 366.

30 Extrinsic evidence received without objection from the parties to these proceedings, which includes materials that would otherwise constitute hearsay evidence, provides some, although by no means a complete, understanding of the circumstances in which the deceased eventually executed the Will which has been received into probate.

31 A document handwritten by the deceased, undated, but perhaps from about 1997, outlines at least some of the deceased's intentions, a number of which found expression or partial expression in the Will.

32 In this document, after some introductory notes, the deceased relevantly wrote:

"Lot 366 House at Denmark Eleanor Anne S Trust with nearly [the numeral is unclear: it appears originally to have been '2', but later written over] ACRES is the Asset of my 2nd begotten child ... The Shire Council (?) and I do not agree at this time on any divisions of the rest of the 17 acres other than the Lot 366 House Block. They - I am told - would like 1/4 acre divisions - some of us are adamant on 1 Acre blocks or no division - Hobby Farms of 5 acres are popular so 1 acre for my mainly relatives as beneficiaries is our requirement ..." (Emphasis as in original)

33 This document then goes on to state who should have how many "blocks", etcetera. The deceased even went to the trouble of suggesting that blocks with particular street frontages to Horsley Road and Rockford Road should go to particular beneficiaries.

34 The deceased further noted, by reference to a valuation made of the land, that "over-all" the blocks were valued at $50,000 per acre.

35 A draft Will was initially prepared for the deceased by her solicitors during 1997. A copy of an early draft, with handwritten amendments placed on it by the deceased, included an annexure A, which showed a proposed plan of subdivision of land adjacent to Horsley Road and Rockford Road comprised of 15 lots, together with an area of "POS", or public open space, comprising some 7200 m2. The inference may be drawn that each of these lots was approximately one acre in area. Some of the proposed lots were to be serviced by a small road called "Randalls Retreat", which was to run off Rockford Road.

36 This draft Will provided for various beneficiaries, but not including the deceased's grand-daughter, Josefin, to receive one or other of the lots numbered 1-15 on this plan. As to Josefin, this draft Will provided in cl 3.1(k)(i) that she should receive "the house situated at 24 Rockford Road, Denmark as set out in annexure 'A' ... ". However, no such house appeared on annexure A. Annexure A only included the lots numbered 1-15 and the area of public open space. All of the lots numbered 1-15 were accounted for by gifts to other proposed beneficiaries.

37 In any event, it appears that the deceased gave due consideration to the terms of this draft Will and notionally reallocated the disposition of the lots shown on the proposed plan of subdivision from what was proposed in the draft Will. For example, by cl 3.1(h) of the draft, Lot 13 on the plan was to go to Bishop Peter Quinn for Saint Mary's Catholic Church, Denmark. However, the deceased then wrote over Lot 13 on annexure A the word "Angela". She did the same in respect of Lot 12 on the plan, which, in the draft by cl 3.1(d)(i), was to go to her son, Peter Maurice Seward.

38 The terms of this draft Will suggest some lack of proper communication between the deceased and her solicitors such that the house and land at 24 Rockford Road, Denmark was thought (perhaps initially by the solicitors) to be a part of the land referred to in annexure A when it appears it was not.

39 On 11 December 1996, the solicitor with the day-to-day responsibility of responding to the deceased's instructions, spoke to the deceased about the terms of her Will and apparently read a draft of the Will to her, including each beneficiary's name and "the property which was bequeathed to them". The solicitor apparently advised the deceased that her solicitors had conducted title searches for her properties and discovered there were only three certificates of title in relation to the Denmark land. The solicitor then pointed out to the deceased that in the draft she had bequeathed "15 separate lots of land" to various members of her family and that this was not legally possible. She mentioned to the deceased that it might be appropriate to leave particular properties to beneficiaries as tenants in common in equal shares or as joint tenants. The solicitor noted:

"Unfortunately I was unable to get this point across to Mrs Seward. She refused to listen to me and didn't appreciate that there were actually only three certificates of title. She kept on referring to them as one block and two blocks and so on."

The solicitor, in her file note dated 11 December 1996, further noted:

"Unfortunately it is still not clear who gets which particular piece of land as she kept on referring to them as one acre block, two acre block, lot 1, lot 2, lot with Moreton Bay Fig, lot with the pine hut etc etc. The only land I could actually clearly ascertain was lot 24 Rockton [sic] Road (the house only) which is going to her grand-daughter Josephine Gi Gi Seward [sic]. It appears she wants to leave the house to the grand-daughter on its own and the surrounding land to different people."

The solicitor hoped that, after speaking with the real estate agent in Denmark, the question of real estate could be sorted out once and for all.

40 It appears that a further draft Will was then prepared, still in 1997, having regard, at least partly, to the deceased's handwritten amendments or observations made on the earlier draft. For example, in this second draft "Perpetual Trustees of Australia (Western Australian Branch)" was nominated as the executor and trustee of the deceased's Will in the place of the "Public Trustee", which was nominated in the first draft. However, no changes of substance seem to have been effected in the second draft in relation to the disposition of the lots numbered 1-15 on annexure A to the Will, which remained intact and attached to the second draft.

41 On 2 April 1997, it appears a solicitor from the deceased's solicitors saw or spoke with the deceased and discussed the question of Lot 366. The note was then made:

"If not sub-div then get that area of the whole & rt to occupy house for her life."

42 This note also recorded that the deceased would ring "Michael" (presumably her son, the second defendant), the next day in order to have him "send a new plan to be annexure 'A'" (emphasis in original).

43 There is no evidence of such a further plan having been forwarded to or received by the solicitors (although it is possible it was provided and is the "annexure A" to the two draft Wills). Rather, the next draft of the Will of the deceased put in evidence is a file copy of a draft held by the solicitors upon which amendments were made apparently by a senior solicitor of the firm. This draft, which was in terms of the second draft, replete with references to annexure A, was amended throughout by deleting the devises in cl 3.1 of portions of the unsubdivided Lot 366 and replacing each with a pecuniary legacy. For example, whereas the earlier draft proposed in cl 3.1(a)(i) that Michael Giles Seward should receive "Lot 5 Denmark as set out in annexure 'A'", this was struck through and replaced with "$60,000". Further, the reference to annexure A in cl 3.2 of the draft was wholly deleted.

44 Until it was deleted, cl 3.2 of the draft Will explained that the reference to annexure A was a reference to land comprising both Lot 366 Horsley Road and number 24, Lot 55 Rockford Road "which if subdivided as at the date of my death then the devises go in accordance with this clause". This draft provision then further provided:

"If the land is not subdivided then my Trustee is to instruct a licensed surveyor to apportion the devises between the Certificates of Title in accordance with the proportions as to area as set out in annexure 'A'."

45 Just what was meant or intended by this draft provision cl 3.2 in the event that the land was not subdivided at the date of death of the deceased is unclear and is probably the reason why the senior solicitor determined that it and other references to annexure A, and the particular devises in cl 3.1, should be deleted from the draft Will.

46 These deletions seem to have been confirmed by the deceased. A file note on the solicitors' file dated 22 May 1997 discloses that the deceased that day telephoned and left a message for her solicitors to this effect:

"Want to sign Will regardless of who owns the land. NB Delete reference to the block. Do the rest except Katherine's [sic] two blocks. KB (House) or $170,000 if no land ... "

Some other words appear which are not easily decipherable, but include "17 acres ... blocks". Subsequently, a further message was received by the solicitors from the deceased to alter the $170,000 to $200,000.

47 A further note on the solicitor's file dated 18 June 1997, however, suggests the deceased left a message for the solicitors:

"Keep the annexure A and Riverwest P/L Concept Plan."

This, at the very least, suggests that the proposed plan of subdivision that had been used as annexure A in the earlier drafts of the Will had been prepared by the first defendant.

48 In any event, under cover of a letter dated 8 July 1997, the deceased's solicitors forwarded to the deceased a further draft of the Will prepared by them. Annexure A did not form any part of the draft. Rather, the draft was that which with her own handwritten amendments, the deceased executed and has now been admitted to probate as her Will.

"We still raise our concern about the gifts referred to in clause 3.1(b) to Kathryn and clause 3.1(j) to Josefin. Although the properties are registered in your name there seems to be considerable doubt as to whether you have legally effected a transfer of those properties to the family trust controlled by Riverview Pty Ltd [sic] and as such would not be owned by you and could not be gifted by you in your Will. If you are not the beneficial owner of those properties as at the date of your death then the gifts referred to in your Will would fail. We confirm that despite this doubt, you wish to keep the provisions as currently drafted.

Please advise whether the Will is now in an acceptable form for your (sic) to execute."

50 Also on 8 July, it appears that the deceased left a telephone message at her solicitors' office to the follow effect:

"$120,000/60,000. Is it for now. 17 acres cost $65,000 in 1967. If 13 blocks ... "

51 On 30 July 1997, the deceased advised her solicitors that she had signed her Will with the Mayor of Claremont. The solicitors' file note stated:

"All done, but she changed it, where it sd '$60K or block of land' added as an option ... nothing further for us to do."

52 It is apparent that, despite advice from her solicitors about the difficulties in disposing of land in her Will which had not been subdivided, the deceased was determined to attempt either to convey or earmark portions of land within Lot 366 for certain beneficiaries.

53 This background shows that, at one point, the deceased, on a proposed plan of subdivision that the first defendant had prepared or caused to be prepared, believed that Lot 366 could support a subdivision of the land into 15 lots each of approximately one acre. For some reason, which is simply not explained on any of the evidence before me, the deceased ultimately determined to dispose of or earmark only 13 "blocks"; the same number apparently mentioned in the message to her solicitors on 8 July.

54 The evidence of Angela Margaret Seward, the fourth defendant, contained in her affidavit sworn 13 February 2003 also tends to confirm their background facts. Ms Seward says that her mother first wrote down her thoughts about her Will when she was visiting Ms Seward in Sydney. Ms Seward believes this was in either September or at Christmas 1995. At that time, the deceased had already sold Lot 10 Springdale Road in Denmark and intended selling Lot 11. The notes of the deceased produced in evidence bear various notations similar to those in the undated handwritten document of the deceased referred to above. The deceased again refers to Lot 366 and "blocks" of an "acre" and uses the expression "acre blocks approx". She also refers to "Lot 366 pine-log house & semi-enclosed nearly 2 acres is the asset of my invalid pensioner daughter ... ". On the face of it, these notes suggest a desire to dispose of approximately 15 acres of Lot 366 to various persons referred to, most but not all of whom ultimately were named as beneficiaries in the Will admitted to probate.

55 What is apparent then, when one comes to the Will admitted to probate, is that the "blocks" referred to in cl 3.1 do not owe themselves to any particular proposed plan of subdivision of Lot 366. Annexure A had obviously been abandoned in this regard. At no stage does it appear that a revised annexure A or proposed plan of subdivision was ever produced to the solicitors for the purposes of the Will.

56 It might be said, although about this there can be no certainty, having regard to this background, that the deceased had a general appreciation that official approval was required for the subdivision of land before new lots could be created. Her reference in the undated document to her discussions with the Shire of her desire to create one-acre lots as against the Shire's support for quarter-acre lots, tends to support this view.

57 In any event, the question arises whether the purported disposition in the Will of portions of Lot 366 which do not comprise "lots" as defined in the Town Planning and Development Act and which are not otherwise defined, renders those provisions of the Will void for uncertainty.

58 It should be said at this point that nothing in this background and the extrinsic evidence upon which the background account relies, helps to remove any of the ambiguities in the Will.

59 This is so in the case of all beneficiaries, including Kathryn. In the earlier typewritten drafts of the Will and on annexure A, as marked by the deceased, Kathryn was, on the face of it, to receive two blocks each of one acre. In the Will as admitted to probate, by cl 3.1(b)(ii), Kathryn is to receive the "pine log house and also 1 acre of land approx 1 Block upon which it is located" (emphasis in original).

60 Whether or not by a testamentary disposition the deceased effectually granted the named beneficiaries an estate or interest in Lot 366 is a question raised by the plaintiff and a number of defendants in these proceedings. In this regard, the first question to be determined is whether the purported devise of portions of Lot 366 is attended with sufficient certainty to make the gift valid in the first place.

61 It is well accepted that a provision of a Will must be incapable of any clear meaning before it is avoided on the ground of uncertainty: see "Williams on Wills" 8th ed (supra) at 566 and the authorities referred to in footnote 1. In some cases, uncertainty may be avoided by the admission of extrinsic evidence, but if the evidence offered, even though it resolves the uncertainty, is inadmissible under the rules governing admission of such evidence, then the gift must inevitably be declared void: "Williams on Wills" (supra) at 566 and authorities referred to in footnotes 5 and 6.

62 It is customary to apply two well-known maxims for the avoidance of uncertainty: "Williams on Wills" (supra) at 566 - 567. First, that indefinite words added to a gift do not render it uncertain where the gift is substantially ascertained from the nature of the case, and no objection can arise where, though the amount of the gift is indefinite, it is stated to be for a particular purpose and the Court can by inquiry ascertain what is the sum sufficient or necessary to answer the purpose.

63 The second is the maxim that, where words are capable of two constructions, it is just and reasonable that such construction should be adopted as tends to make the document effective. Thus, a Will should be construed to give effect, as far as possible, to every word, and to give effect to the gift if it is possible to do so rather than to declare it void for uncertainty and so defeat the testator's intention.

64 In cl 3.1 of the Will, each gift of a "block" as an alternative to a pecuniary legacy plainly involves a gift of an undefined portion of land, albeit a portion of Lot 366. In my view, the inability to say at all what portion of land each of the beneficiaries in this class is to receive, makes the provision incapable of application and uncertain.

65 A similar difficulty arose in Donaldson v Leaf [1907] VicLawRp 53; [1907] VLR 278 where the testatrix in her Will provided as follows:

"I give devise and bequeath unto William Leaf 40 acres of land situated in the parish of Waaia colony of Victoria being part of 140 land I also give and bequeath unto my grandchildren five grandsons and two granddaughters the remaining one hundred acres to be divided in equal shares." (as in original)

66 A'Beckett J found that the testatrix owned about 144 acres of land and that she obviously intended that 40 acres should go to her son, William, and the balance to the grandchildren. However, as to the 40 acres that her son was to take, his Honour considered it impossible to discover from either the Will itself or extrinsic evidence what portion of the whole it was to comprise.

67 In the present case - save with the possible exception of the devise to Kathryn, to which I will shortly turn - each devise of a "block" appears to leave it to the beneficiary concerned first to decide if he or she wishes to take a "block" in preference to the legacy and, if so, to select the "block" he or she will take. In each of these cases it seems the beneficiary has the power of selection.

68 In relation to a power of selection, as "Williams on Wills" 8th ed (supra) explains at 84 - 85, a testator having several properties of the same description may give a donee a right of selection of one or more such properties, or give the donee a right to select from them property to a stated amount or value. The right to select may be expressly stated or may appear by inference. If no limit is placed on the selection, the donee may take all the properties if he so desires. Where a number of similar properties are given to an equal number of beneficiaries, the selection is to be made by the beneficiaries in the order in which they are named in the Will and where, in such a case, some beneficiaries are collectively referred to, such as children or nephews or nieces, then the order of selection must be determined by lot. Where, by imperfect wording of the Will, a testator gives one of several similar properties to a donee and the Court is unable to say from the Will itself, or from the extrinsic evidence, which of the properties the testator intended the donee to take, the gift fails for uncertainty and the donee cannot select one of the properties. Where a right of selection is given to one donee and a second donee is to take the residue of the property, if the first donee predeceases the testator so he cannot make the selection, the gift to the second donee fails. The right of selection is purely personal to the donee, and, if he dies without having made the selection, the right does not pass to his personal representatives and a donee, once having made a selection, has no power to give up the selected property and make a second selection and any permission by trustees for him to do so is ultra vires.

69 In Donaldson v Leaf (supra) it was contended that the son had the right to select the 40 acres the deceased intended he should have. A'Beckett J, at 282 - 283, rejected this contention and stated:

"On behalf of William Leaf it was suggested that the will might be held to give him a right to select any forty acres of his mother's land if he could not claim the block she intended him to have. Asten v Asten [1894] 3 Ch 261, to which counsel referred me, disposes of this contention. It was there held that if it can be gathered from the words used that a testator intended to give a particular property, but owing to the testator having several properties answering the description in the will it is impossible to say, either from the will itself or from extrinsic evidence, which of these several properties the testator referred to, the gift fails for uncertainty, and the Court cannot, to avoid an intestacy, construe the will as giving the legatee the option of electing which property he will take. In re Cheadle [1900] 2 Ch 620 is to the same effect."

70 The same difficulty arises here in relation to the deceased's Will. It is simply not possible to state what items of property the beneficiary is to select from. Apart from any other consideration, this factor makes it difficult, if not impossible, to apply the selection rules referred to above. There is only one property (Lot 366), not several. There are no defined "blocks" of approximately one acre from which a beneficiary can choose. Even if it were possible to create an order of selection between beneficiaries so that each selected in the order named in the Will, or by casting lots, there are no particular portions of land to select from.

71 The additional difficulty raised by the gifts to the beneficiaries in this class is that the devise of the "block" is an alternative to a pecuniary legacy. The gift is one of the money or the "block". Each beneficiary in this class, by proper construction of the option given to them, may decide whether to take the money or the "block". If some were to take the money and some were to take the "block", then conceivably there would be some "blocks" left over and the whole of Lot 366 would not be disposed of. Such a possible outcome simply adds to the uncertainty created by the gift of undefined "blocks".

72 In Tatham v Huxtable [1950] HCA 56; (1950) 81 CLR 639, the Court was required to construe the provision of a Will which followed the making of various pecuniary legacies and dealt with the residue of the estate in these terms:

"(11) I hereby authorise and empower in law my executor the said Edgar Ernest Huxtable, to distribute any balance of my real and personal estate which may at the time of my decease be possessed wholly or in part by me, to the beneficiaries of this my Will and Testament, in addition to amounts already specified, or to others not otherwise provided for who, in my opinion have rendered service meriting consideration by the Testator."

73 The Court by a majority (Fullagar and Kitto JJ, Latham CJ dissenting), held that the testator had not provided a definite criterion for the ascertainment of his beneficiaries and that the entire residuary bequest was void for uncertainty. Kitto J (with whom Fullagar J agreed, but also added some additional reasons) applied the "cardinal rule" at 653, namely:

"It is 'a cardinal rule', to which a power of selection among charitable objects is the sole exception, that 'a man may not delegate his testamentary power. To him the law gives the right to dispose of his estate in favour of ascertained or ascertainable persons. He does not exercise that right if in effect he empowers his executors to say what persons or objects are to be his beneficiaries': Chichester Diocesan Fund v Simpson [1944] UKHL 2; [1944] AC 341, per Lord Simonds at 371."

74 The circumstances of Tatham v Huxtable (supra) were complicated by the fact that the executor was also a beneficiary under the Will and so, on the face of it, could exercise the discretion created by cl (11) to distribute the Will to himself. Kitto J, at 656, stated:

"In my opinion, the clause must be judged upon the principles applicable to special powers of appointment; and so judged it must fail, for the testator has not provided a definite criterion for the ascertainment of his beneficiaries, but has purported to delegate the choice of them to the insufficiently guided judgment of another person."

75 In my view, the alternative devises, which appear to create a right of selection in each of the beneficiaries in this class to take a "block" instead of a pecuniary legacy fails utterly for uncertainty. In effect, even if the difficulties concerning the identification of the properties from amongst which the beneficiary is entitled to select an item for himself or herself did not invalidate the gift for uncertainty, as I consider it does, the granting of a power to a beneficiary to decide for himself or herself what portion of the deceased's estate he or she should take seems to me to involve an unlawful delegation of the testamentary power by the deceased to each of those beneficiaries.

76 While one may surmise about the intention of the deceased in adding the handwritten provisions of the Will concerning the "blocks" in the manner that she did, the result is that this Court, as a Court of construction, is left with considerable uncertainty as to how these provisions should be construed.

77 In those circumstances, the handwritten additions in the case of each of the alternative devises must be considered void for uncertainty.

78 The result is that the Will should be construed having regard only to the pecuniary legacy in each such case, which provision is quite certain.

79 That, then, leaves for determination the proper construction of the gift to Kathryn, which has been set out in detail above. Does it, too, fail for want of certainty? The essence of this gift is the "pine log house and also 1 acre of land upon which it is located on the 17 acres of land at Lot 366 Horsley Road, Denmark ... " (emphasis in original).

80 There are many examples of devises of a house where the devise has not been spelled out in metes and bounds or by some more particular description of the land, which have been found not to fail for want of certainty. This is because it is generally accepted that words used in a Will describing a house may, according to the context or the circumstances, include land occupied and enjoyed with it, especially if such land is necessary for its convenient use or enjoyment: see "Williams on Wills" 8th ed (supra) at 642. Sometimes, the word "house" is accompanied by further words such as "and premises" and then something more than the actual building must be included. This may extend to land commonly enjoyed with the house: see for example, In the Will of Rayner (1928) 23 Tas LR 41, where the "home" was held to include five and a half acres of orchard occupied with the house.

81 The third defendant submits that the gift to her of the pine log house sufficiently particularises the property to prevent the Will being avoided for uncertainty. However, I am not satisfied that this is so. If it were a gift only of the "pine log house", her argument on this point may succeed. However, it is important that sight not be lost of the terms of the devise, including the handwritten amendment to the typewritten form of the Will made by the deceased. To the gift of the "pine log house and also 1 acre of land" the deceased added: "approx 1 Block".

82 In my view, properly construed, the gift to Kathryn comprises not a separate gift of the "pine log house" and a separate gift of "1 acre of land approx 1 Block", but a compendious gift of the "pine log house and also 1 acre of land approx 1 Block upon which it [that is to say, the pine log house] is located ... ". Understood in this way, while the identity of the pine log house is not in question, the identity of the "1 acre of land approx 1 Block" is, and it is uncertain. In the context of the Will of the deceased, this purported devise fails for the same reason as the other similar purported alternative devises of a "block" of "1 acre approx" fail, namely, because it is impossible to know which one acre of land should accompany the portion on which stands the pine log house.

83 To the extent that it might be argued that the Will might be held to give the executor and trustee, or the beneficiary Kathryn, the right to select an acre adjacent to the pine log house, for the reason explained by A'Beckett J in Donaldson v Leaf (supra), this contention is not open. The selection is not able to be made between particular properties: at best it would be a selection of that one-acre of land adjacent to the house that best suits the trustee or the donee of the gift.

84 Further, in the sense described in Tatham v Huxtable (supra), such a gift also fails because the provision involves an unlawful delegation of the testamentary power of the deceased to the trustee or the beneficiary.

85 In my view, therefore, the portion of the gift to Kathryn in cl 3.1(b)(ii) that refers to the pine log house and the one acre of land, approximately one "block", fails for want of certainty. However, to the extent that the gift in this clause comprises a bequest of the contents of the pine log house, it is plain and certain.

86 The second issue concerning the validity of the alternative devises in cl 3.1 in relation to portions of Lot 366 is whether by her Will the deceased could validly transmit interests in portions of Lot 366 to particular beneficiaries when none of those portions comprised a "lot" as defined in s 2 of the Town Planning and Development Act. This second issue only arises should the handwritten alterations to the Will not be considered void for uncertainty. However, as the second issue was the subject of written and oral submissions, it is appropriate to deal with it.

87 Immediately before the date of death of the deceased, subdivision of Lot 366 Horsley Road, Denmark, was not possible without the prior approval of the Western Australian Planning Commission pursuant to s 20(1)(a) of the Town Planning and Development Act. As of that date, s 20(1)(a) relevantly provided as follows:

"Subject to section 68 of the Environmental Protection Act 1986, to this section and to section 20B, a person shall not, without the approval of the Commission, lay out, grant or convey a street, road or way, or either lease or grant a licence to use or occupy land for any term exceeding 10 years including any option to extend or renew the term or period, or lease and grant a licence to use or occupy land for terms in the aggregate exceeding 10 years, including any option to renew or extend the terms or periods, or sell land or grant any option of purchase of land, unless the land is dealt with by way of such lease, licence, sale or option of purchase as a lot or lots, or subdivide any lot or amalgamate any lot ...; and the Commission may give its approval under this paragraph subject to conditions which shall be carried out before the approval becomes effective."

88 Further, as of that date, s 20(2) of the Town Planning and Development Act provided that:

"The Registrar of Titles shall not create or register a certificate of title under the Transfer of Land Act 1893 for land the subject of a plan of subdivision unless −

(a) in the case of a plan of subdivision to which this Act applies, the diagram or plan of survey of the subdivision of that land submitted to the Commission under section 20AA; or

(b) in the case of a plan of subdivision to which this Act does not apply, the application for title concerned,

has been endorsed with the approval of the Commission."

89 For present purposes, s 68 of the Environmental Protection Act 1986 (WA) and s 20B of the Town Planning and Development Act are not material.

90 The plaintiff submits that the alternative devises and the devise concerning portions of Lot 366 offend s 20(1) of the Town Planning and Development Act and for this reason must fail. In this, the plaintiff is supported by each of the first defendant, second defendant and sixth defendant, and also by the fourth defendant except so far as the submission affects the third defendant. The third defendant contests this submission.

91 The third defendant contends that whether or not s 20(1) of the Town Planning and Development Act proscribes the testamentary dispositions in relation to portions of Lot 366 falls to be determined by reference to the requirement that a person shall not, without the approval of the Commission "sell land ... unless the land is dealt with by way of such ... sale ... as a lot or lots, or subdivide any lot ... ". The third defendant submits there is no definition of "subdivide" in the Town Planning and Development Act and, in effect, that the expression "subdivide" should not be construed to apply to the testamentary dispositions in question.

92 The third defendant draws attention to s 21(1) of the Town Planning and Development Act which relevantly provides that:

"(1) A transfer, conveyance, lease or mortgage of any land shall not be received or registered in the Department ... unless -

(a) it has been first approved in writing by the Commission; or

(b) the land comprises the whole of one or more lots, or the land comprises part of a lot included in a plan of subdivision that has been approved by the Commission; or

(c) ... "

93 The third defendant also draws attention to s 30(1) of the Trustees Act 1962 (WA) which provides that:

"(1) Every trustee, in respect of any property for the time being invested in him, may -

...

(d) where the property is land and the land may be sold ... or otherwise disposed of under any power or trust vested in the trustee, subdivide the land into blocks and for such purpose ... do all such other things ... as he thinks necessary or as are required by, or under, any Act relating to subdivisions;"

94 The third defendant contends that, because the plaintiff has power to sell Lot 366 under cl 6(a) of the Will, it follows that the Trust created in respect of each devise, and at least the devise in favour of the third defendant, is not illegal, as the plaintiff could attempt to subdivide the Horsley land with the approval of the Commission and could then transfer at least to the third defendant the devise in her favour without breaching s 20(1) of the Town Planning and Development Act.

95 The third defendant further contends that, if subdivision cannot be effected in that way, the plaintiff should be found to hold the land upon trust as to the land devised to her, for her.

96 The first question is whether a combination of cl 6(a) of the Will, s 30(1) of the Trustees Act and the statutory power of the Commission to approve a subdivision of land may be relied upon by the third defendant to validate at least the purported devise of portion of Lot 366 to the third defendant.

97 In my view, this contention cannot be upheld. In effect, it requires the Will in this regard to be construed as a conditional devise of a part of a "lot" as defined by the Town Planning and Development Act, subject to the approval of the Commission. I do not consider that the Will can be construed in this way.

98 By the relevant purported devise in favour of the third defendant, the deceased purported to create an immediate interest in respect of a particular portion of an unsubdivided lot. Nothing in the Will suggests that the devise was conditional on a subdivision of land being approved in respect of the portion in question.

99 I have already dealt with the question concerning the appropriate identification of the portion of Lot 366 which the deceased intended to be gifted by this means. The uncertainty of the "1 acre" that is to accompany the pine log house is demonstrated indeed by this argument. Until such time as the Commission were to approve a particular form of subdivision that included as part of the subdivision a "lot" that conformed precisely with the subject of the devise in the Will, the gift in favour of the third defendant could not be effectuated.

100 In my view, therefore, the first contention put by the third defendant must fail.

101 That, then, leaves the question whether the second contention can succeed, namely, whether the plaintiff must hold in trust the land purportedly devised to the third defendant, notwithstanding that the land the subject of the devise does not comprise a "lot" for the purposes of s 20(1) of the Town Planning and Development Act.

102 In this regard, the third defendant relies on Re Leaver [1997] 1 Qd R 55. In that case, the testator by a codicil to his Will devised to a beneficiary his dwelling-house and the adjoining garage building which formed only part of a lot which could not be subdivided. On another part of the lot was another house. The Court had no difficulty in determining that, by the Will, the testator intended that the beneficiary should have a portion of the unsubdivided lot. The question was then raised whether such a testamentary disposition was valid.

"It being comfortably established that the gift comprised the house garage and an excised area of curtilage to be determined on a practical basis, the most difficult issue appears not because the required excision is impeded by the zoning of the land that does not permit of subdivision. It is not that, as with the Land Sales Act 1984, a disposition (in that case a sale) of part of land without approved subdivision is prohibited and made void, or as with the Local Government Act 1936-1982, which has now been superseded, the sale and certain other dealings with subdivided land without approved subdivision is forbidden and the transaction made conditional on such approval. It is only that subdivisional approval cannot be obtained under the Local Government (Planning and Environment) Act 1990, which however does not expressly prohibit or avoid any dealings with part of land that has not been subdivided in accordance with it."

104 In making these observations, Derrington J appeared to accept that if the disposition of part of land without approved subdivision were prohibited and made void, then such a testamentary disposition would not be possible. In other words, the decision in Re Leaver depended very much upon the particular terms of the subdivision control legislation in question.

105 Derrington J, at 58 - 59, noted that, under the relevant Local Government (Planning and Environment) Act 1990, the expression "subdivision" was defined as follows:

" 'subdivision' means the division of land into parts by means of -

(a) sale, transfer or partition; or

(b) any agreement, dealing or instrument inter vivos (other than a lease for any term not exceeding 5 years without the right of renewal) rendering different parts thereof immediately available for separate disposition or separate occupation; or

(c) the creation of an indefeasible title under the Land Title Act 1994 for a part of the land; or

(d) the excision of land from an allotment for dedication to the Crown."

106 His Honour noted that the omission from this definition of dealings that are not inter vivos, and even of inter vivos leases under five years, indicated that such dealings are not intended to be affected by the legislation. He considered that the omission could only be regarded as deliberately manifesting an intention to allow the omitted dealings to have full force without impediment by the legislation.

107 Derrington J concluded then that there was strong reason to conclude that a disposition by Will was not prohibited or avoided by the legislation. Accordingly, he considered an equitable interest by way of trust may arise in respect of a portion of unsubdivided land. In short, he considered that such a trust was not prohibited by the relevant law of Queensland.

108 In essence, the third defendant argues for the same outcome in respect of s 20(1) of the Town Planning and Development Act in this State.

109 If one considers the terms of s 20(1) set out above, it is plain enough that many of the transactions prohibited by the subsection without the approval of the Commission constitute inter vivos transactions; such as the prohibition on sale of portion of a lot. However, the provision that a person shall not "subdivide any lot" without the Commission's approval is, in my view, capable of applying both to an inter vivos and testamentary disposition. The question is whether the purported devise, for example, to the third defendant of a portion of Lot 366, offends the proscription that "a person shall not ... subdivide any lot ... ".

110 Section 20(1) of the Town Planning and Development Act has a long history and it has been amended over time. As at 1971, s 20(1)(a) relevantly provided that:

"Subject to section twenty B of this Act, a person shall not, without the approval of the Board, lay out, grant or convey a street, road or way, or subdivide, or either lease or grant a license to use or occupy land for any term exceeding ten years including any option to renew or renew the term or period or lease and grant a license to use or occupy land for terms in the aggregate exceeding ten years, including any option to renew or extend the terms or periods, or sell land or grant any option of purchase of land except as a lot or as lots; ... "

111 In Lombardo v Development Underwriting (WA) Pty Ltd [1971] WAR 188, the question arose whether the appellant had contravened s 20(1)(a) when, before fully complying with all conditions imposed by the Board on an approval to subdivide in accordance with a sketch plan, it entered into a contract with the respondent to sell 20 fully developed building blocks.

112 Hale J, at 196, stated that he did not think it was the case that the word "subdivide" in s 20(1)(a) related to work done on the ground, that is, some sort of physical subdivision. His Honour, at 196, stated:

"The word is not defined and I doubt whether the draftsman had any clear idea what it was which he wished to prohibit, but it appears to me to be aimed at a plan of subdivision rather than at physical works on the ground ... it appears to me that the references in s 20(1) to subdivision and to a plan of subdivision (are) from a practical point of view references to the same thing ... the Act put an end to 'do-it-yourself' subdivisions."

113 Wickham J, at 198, while not attempting to provide a definition of "subdivide", stated that, in his opinion, the word:

"[I]ncludes a physical idea, although used in a town planning context so as not necessarily to include the mere physical creation of divisions for the other purposes such as the making of farm paddocks and the like."

114 By 1982, s 20(1) had been amended so that it then appeared substantially in the form that it now appears in the Act for the purposes of this matter, so that the passage "or subdivide" as it appeared in the earlier provision set out above was deleted and at the end of the paragraph the following words were added: "or subdivide any lot, or amalgamate any lot with any other lot ... ".

115 In Boans Ltd v Kwinana Hub Shopping Centre [1982] WAR 41, land which had been a single lot was subdivided into two portions with approval under the Act. The proprietor of one of the new lots leased it to the defendant for 50 years. The plaintiff, a sub-tenant, contended that the land was not a "lot" within the meaning of the Town Planning and Development Act and that the lease, having been executed without the prior approval of the Town Planning Board, was illegal and void. The plaintiff further contended that, whether or not the land was a lot, the lease had a term in excess of 10 years and was prohibited by s 20(1)(a) of the Act.

116 Smith J, at 44, noted that it was accepted by counsel for all parties that the policy of the Act was to control individual activity in the subdivision of land and that the Act:

" 'indicates that policy of supervision of individual activity by providing for control in the creation of what might be called an important unit of subdivisional planning and development: the "lot" (per D'Arcy J in Glass v Ralph [1966] WAR 91)'."

"Prior to the 1928 Act an effective subdivision ready for sale in lots could have been effected pursuant to ss 166 and 167 of the Transfer of Land Act 1893 by the deposit at the Office of Titles of a plan of subdivision verified by a licensed surveyor. As Hale J said in Lombardo v Development Underwriting (WA) Pty Ltd ... , 'The Act put an end to "do-it-yourself" subdivisions'. To this end s 20 of the Act prohibits the subdivision of land and certain dealings in land which, in practical terms, might have the same effect as a subdivision of land without the approval of the Board having been first obtained thereto."

118 In Palamore Pty Ltd v Clode, unreported; SCt of WA; Library No 980599; 16 October 1998, the parties held a piece of land near Broome as tenants in common. A deed entered into at the time of purchase gave the plaintiff exclusive use, occupation and control of a portion of the land and the defendant exclusive use, occupation and control of the remainder. The plaintiff contended that the deed contravened s 20(1)(a) of the Act and that the clause relating to exclusive use, etcetera, was void.

Perpetual Trustees WA Ltd (As Executor of the Estate of Eleanor Anne Seward (Dec)) v Riverwest Pty Ltd & Ors [2004] WASC 81

At a glance

Court

Decision date

Before

Catchwords

Source

Catchwords

Judgment (324 paragraphs)

Perpetual Trustees WA Ltd (As Executor of the Estate of Eleanor Anne Seward (Dec)) v Riverwest Pty Ltd & Ors [2004] WASC 81 (7 May 2004)

The cl 3.1 devises in respect of portions of Lot 366 Horsley Road, Denmark

The question of the trustee's obligation to subdivide Lot 366 Horsley Road, Denmark

Strata Lots 3 and 4, 10 Stanford Way, Malaga

Parties

Legislation Cited (9)

Cases Cited (3)