Petkovic v Koutalianos [2016] NSWSC 1817 | Case summary

Supreme Court of NSW|2016-11-17|Before: Hallen J

The Kingsgrove Property

The thrust of the Plaintiff's case related to the state and condition of the Kingsgrove property and what was submitted would be the inevitability of its sale as the Defendant could not continue to live there because of its condition and because of the financial and material circumstances of the Defendant which did not permit its repair or renovation.
A hand drawn plan of the home (Ex. E) revealed that it is a three bedroom home with an internal bathroom, a lounge room, a dining room, a kitchen, an outside toilet (which is unusable), a fourth bedroom or storeroom, a rear patio, and a double garage.
Photographs, which form part of Ex. A, were tendered to depict its current condition. In particular, some photographs reveal that the lawn is overgrown, that some of the rooms are filled with clutter, and at least part of one room is filled with old newspapers. The Plaintiff says that there are "mounds of newspapers, plastic bags and other items that fill the Kingsgrove property". She states that there would be costs incurred to dispose of the rubbish and to clean, maintain and repair the property, prior to its sale. She also gave evidence that the plastic sheeting covering the rear patio is insecure, that some of the weatherboard timber in the home has gaps opening it to the elements, the carpet is threadbare, dirty and "smelly", that tiles in the bathroom had lifted, and that the carpet in the hallway leading to the bathroom was wet, dirty, and threadbare at the doorway. In broad terms, the Plaintiff gave evidence that the Kingsgrove property is in a dilapidated condition.
The Plaintiff also gave evidence that she believed "it will require a substantial sum of money to make the Kingsgrove property saleable" and that "there are over 20 cubic metres of papers and other items that must be removed and disposed of". (It was submitted that the Plaintiff had estimated those costs and expenses at $100,000. I do not consider that the Plaintiff's evidence bears that conclusion because the reference to that amount is made in the context of a conversation with a bank officer who is said to have told her that if the property was worth $1 million, "then the executors should be able to borrow $100,000 secured over the Kingsgrove property to pay for cleaning, maintenance and repairs.")
The Defendant stated that whilst some of the Plaintiff's comments about the condition of the Kingsgrove property were accurate, some parts of her description were exaggerated. For example, the Defendant maintained that the house did not leak; that even though the outside toilet was unusable, the inside bathroom worked, that she only needed one toilet, and for that reason it did not need to be fixed; that the rooms being filled with "clutter" was exaggerated; that the house was not untidy and that she could still walk around it and live in it; that whilst the carpets were original, they "did not smell badly"; and that "it's not as run down as it was made out to be" (T46.38).
Whilst it is clear that the Kingsgrove property is not as well maintained as it might be, I accept the Defendant's evidence to the effect that she has been living there for 32 years, she has possessions there, it provides her with stability, and that she feels safe and comfortable there.

The Statutory Scheme

Next, I shall discuss the statutory scheme that is relevant to the facts of the present case. As the Plaintiff's eligibility and the commencement of the proceedings within time is not in issue, the sole questions for the Court to determine are whether the Plaintiff has been left with inadequate provision for her proper maintenance, education and advancement in life and, if so, what, if any, further provision ought to be made out of the estate of the deceased for those purposes.
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".
The parties were largely agreed as to the principles to be applied on this topic so it is not necessary to re-state them in detail. I have dealt with them in many cases, one of which is Hinderry v Hinderry [2016] NSWSC 780.
Whether the disposition of the deceased's estate was not such as to make adequate provision for the proper maintenance, education or advancement in life of the Plaintiff will always, as a practical matter, involve an evaluation of the provision, if any, made for the claimant on the one hand, and the claimant's "needs" that cannot be met from his, or her, own resources on the other. See Hunter v Hunter (1987) 8 NSWLR 573 at 575 (Kirby P).
Although the existence or absence of "needs" which the applicant cannot meet from his, or her, 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 his or her proper maintenance, education and advancement in life: Singer v Berghouse [1994] HCA 40; (1994) 181 CLR 201 at 227 (Gaudron J). Compare Gorton v Parks (1989) 17 NSWLR 6-11 (Bryson J); Collicoat v McMillan [1999] 3 VR 803 at 816 [38], 820 [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) 119 SASR 523; [2014] SASC 86 at [41], David J at added: "'Need' is not so synonymous with 'want' such that the two are interchangeable."
As Callinan and Heydon JJ emphasised in Vigolo v Bostin (2005) 221 CLR 191; [2005] HCA 11 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.
If the Court is satisfied that, at the time when the Court is considering the application, adequate provision for the proper maintenance, education or advancement in life of the applicant has not been made by the Will of the deceased, it determines whether to make an order for provision and what provision ought to be made.
The questions posed arise under s 59(2) and s 60(1)(b) of the Act. Mason CJ, Deane and McHugh JJ, in Singer v Berghouse, at 211, affirmed that the decision made 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 of the Act 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, described by Basten JA in Andrew v Andrew (2012) 81 NSWLR 656; [2012] NSWCA 308 at [37], as "a multifactorial list", and by Lindsay J in Verzar v Verzar [2012] NSWSC 1380 at [123], as "a valuable prompt" to which the Court may have regard, together with "any other matter the court considers relevant", for the purposes of determining eligibility, whether to make a family provision order and the nature of any such order.
In Chapple v Wilcox [2014] NSWCA 392; 87 NSWLR 646 at [7], Basten JA wrote: "Section 60 of the Succession Act spells out the matters which the Court may have regard to in determining whether the claimant 'is an eligible person' and whether to make a family provision order: s 60(1). Most of the factors listed in s 60(2) will be irrelevant in relation to whether the applicant is an eligible person, a matter largely dependent upon the language of s 57. The matters set out must be available considerations in relation to both limbs of s 59(1) dealing with a family provision order, namely par (b) and par (c). Section 60 provides no assistance in relation to the different considerations which may arise in respect of each paragraph of s 59(1). The factors are also relevant to the determination of the 'nature of any such order', which presumably includes the discretionary element to be found in s 59(2): s 60(1)(b)."
The section does not prioritise the catalogue of matters that may be taken into account. No matter is more, or less, important than any other. The weight of such of the matters specified in the section, which may be taken into account, will depend upon the facts of the particular case. There is no mandatory command to take into account any of the matters enumerated. None of the matters listed is, necessarily, of decisive significance and none differentiate, in their application, between classes of eligible person. Similarly, there is no distinction based on gender.
The section also does not say how the matters listed are to be used to determine the matters identified in s 60(1). Considering each of the relevant matters does not prescribe a particular result, and whilst there is likely to be a substantial overlap in the matters that the Court may take into account when determining the answers to what is posed in s 60(1), those matters are not identical.
A reference to some of the matters in s 60(2) not only permits, but requires, a comparison to be made between the respective positions of the applicant and any other eligible person, as well as of any beneficiary, whilst others do not. Importantly, also, many of the matters in sub-section (2), of themselves, are incapable of providing an answer to the questions posed in s 60(1).
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.
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).
Unless the Court orders otherwise, any family provision order under the Act takes effect as if it were 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.
There are some other general principles that should be identified, although I have repeated them in many cases.
The Court's discretion is not untrammelled, or to be exercised according to idiosyncratic notions of what is thought to be fair, or in such a way as to transgress, unnecessarily, upon the deceased's freedom of testation: Pontifical Society for the Propagation of the Faith v Scales [1962] HCA 19; (1962) 107 CLR 9 at 19 (Dixon CJ); McKenzie v Topp [2004] VSC 90 at [63].
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."
Of the freedom, in Grey v Harrison [1997] 2 VR 359, Callaway JA said, at 366: "... [I]t is one of the freedoms that shape our society, and an important human right, that a person should be free to dispose of his or her property as he or she thinks fit. Rights and freedoms must of course be exercised and enjoyed conformably with the rights and freedoms of others, but there is no equity, as it were, to interfere with a testator's dispositions unless he or she has abused that right. To do so is to assume a power to take property from the intended object of the testator's bounty and give it to someone else. In conferring a discretion in the wide terms found in s 91, the legislature intended it to be exercised in a principled way. A breach of moral duty is the justification for curial intervention and simultaneously limits its legitimate extent."
In Vigolo v Bostin, at [10], Gleeson CJ pointed out that the relevant legislation did not confer new rights of succession and did not create legal rights of inheritance. Rather, his Honour explained: "It preserved freedom of testamentary disposition, but subjected that freedom to a new qualification".
In Goodsell v Wellington [2011] NSWSC 1232 at [108], I also noted that: "Freedom of testamentary disposition remains a prominent feature of the Australian legal system. Its significance is both practical and symbolic and should not be underestimated."
As Pembroke J said, in Wilcox v Wilcox [2012] NSWSC 1138 at [23]: "The court does not simply ride roughshod over the testator's intentions… The court's power to make an award is limited. The purpose of the discretionary power under Section 59(1) is to redress circumstances where 'adequate provision' has not been made for the 'proper maintenance, education or advancement in life' of the claimant. The adjectives 'adequate' and 'proper' are words of circumspection."
White J referred to these principles in Slack v Rogan; Palffy v Rogan [2013] NSWSC 522; (2013) 85 NSWLR 253, at [127]: "In my view, respect should be given to a capable testator's judgment as to who should benefit from the estate if it can be seen that the testator has duly considered the claims on the estate. That is not to deny that s 59 of the Succession Act interferes with the freedom of testamentary disposition. Plainly it does, and courts have a duty to interfere with the will if the provision made for an eligible applicant is less than adequate for his or her proper maintenance and advancement in life. But it must be acknowledged that the evidence that can be presented after the testator's death is necessarily inadequate. Typically, as in this case, there can be no or only limited contradiction of the applicant's evidence as to his or her relationship and dealings with the deceased. The deceased will have been in a better position to determine what provision for a claimant's maintenance and advancement in life is proper than will be a court called on to determine that question months or years after the deceased's death when the person best able to give evidence on that question is no longer alive. Accordingly, if the deceased was capable of giving due consideration to that question and did so, considerable weight should be given to the testator's testamentary wishes in recognition of the better position in which the deceased was placed (Stott v Cook (1960) 33 ALJR 447 per Taylor J at 453-454 cited in Nowak v Beska [2013] NSWSC 166 at [136]). This is subject to the qualification that the court's determination under s 59(1)(c) and (2) is to be made having regard to the circumstances at the time the court is considering the application, rather than at the time of the deceased's death or will."
In relation to the statement made by the deceased, in Hughes v National Trustees Executors & Agency Co of Australasia Ltd (1979) 143 CLR 134 at 138; [1979] HCA 2, at [7], Barwick CJ wrote: "…When attempting to decide what a particular testator or testatrix ought as a just and wise father or mother to have done, those reasons which that testator or testatrix actually entertained for his or her decision cannot, it seems to me, justly be ignored. Of course, if the evidence in the matter does not support such reasons, they cannot be acted upon simply because the deceased asserted or entertained them."
Yet, in considering the question, the nature and content of what is adequate provision for the proper maintenance, education and advancement in life of an applicant, is not fixed or static. Rather, it is a flexible concept, the measure of which should be adapted to conform with what is considered to be right and proper according to contemporary accepted community standards: Pontifical Society for the Propagation of the Faith v Scales at 19; Walker v Walker (Supreme Court (NSW), Young J, 17 May 1996, unrep); Stern v Sekers; Sekers v Sekers [2010] NSWSC 59.
In Henry v Hancock [2016] NSWSC 71, at [69], Brereton J wrote: "Formerly, the yardstick which was applied was that of the wise and just testator. Nowadays, it is fashionable to couch it in terms of "community standards", although I am not at all sure that this is any different from the moral obligation of a wise and just testator and, as has not infrequently been pointed out, there is no ascertainable external community standard to guide the decision, which involves a broad evaluative judgment unconstrained by preconceptions and predispositions, and affording due respect to the judgment of a capable testator who appears to have duly considered the claims on his or her testamentary bounty - subject to the qualification that the court's determination is made having regard to the circumstances at the time of the hearing, rather than at the time of the testator's will or death."
In all cases under the Act, what is adequate and proper provision is necessarily fact specific.
All of the financial needs of an applicant have to be taken into account and considered by reference to the other factors referred to in the Act and in Singer v Berghouse. What is proper provision is not arrived at by adding up all of the identified financial needs: Hyland v Burbidge [2000] NSWSC 12 at [56]. Nor does it follow that, if the Court decides it is inappropriate to make a specific provision in respect of one identified head of claim, that any identified financial need, even a contingent need, in relation to that claim becomes irrelevant to the final assessment: Mayfield v Lloyd-Williams [2004] NSWSC 419 at [89].
In relation to the Plaintiff's claim, being a claim for provision by an adult child, the following principles are also useful to remember: 1. The relationship between parent and child changes when the child attains adulthood. However, a child does not cease to be a natural recipient of parental ties, affection or support, as the bonds of childhood are relaxed. 2. It is impossible to describe, in terms of universal application, the moral obligation, or community expectation, of a parent in respect of an adult child. It can be said that, "ordinarily, the community expects parents to raise and educate their children to the very best of their ability while they remain children; probably to assist them with a tertiary education, where that is feasible; where funds allow, to provide them with a start in life, such as a deposit on a home, although it might well take a different form. The community does not expect a parent, in ordinary circumstances, to provide an unencumbered house, or to set his, or her, child up in a position where she or he can acquire a house unencumbered, although in a particular case, where assets permit and the relationship between the parties is such as to justify it, there might be such an obligation": Taylor v Farrugia [2009] NSWSC 801 at [57]; McGrath v Eves [2005] NSWSC 1006; Kohari v Snow [2013] NSWSC 452 at [121]; Salmon v Osmond [2015] NSWCA 42 at [109]. 3. Generally, also, "the community does not expect a parent to look after his or her children for the rest of [the child's life] and into retirement, especially when there is someone else, such as a spouse, who has a primary obligation to do so. Plainly, if an adult child remains a dependent of a parent, the community usually expects the parent to make provision to fulfil that ongoing dependency after death. But where a child, even an adult child, falls on hard times and where there are assets available, then the community may expect a parent to provide a buffer against contingencies; and where a child has been unable to accumulate superannuation or make other provision for their retirement, something to assist in retirement where otherwise they would be left destitute": Taylor v Farrugia at [58]. 4. If the applicant has an obligation to support others, such as a parent's obligation to support a dependent child, that will be a relevant factor in determining what is an appropriate provision for the maintenance of the applicant: Re Buckland, Deceased [1966] VR 404 at 411; Hughes v National Trustees Executors and Agency Co of Australasia Ltd [1979] HCA 2; (1979) 143 CLR 134 at 148; Goodman v Windeyer [1980] HCA 31; 144 CLR 490 at 498, 505. But the Act does not permit orders to be made to provide for the support of third persons that the applicant, however reasonably, wishes to support, where there is no obligation of the deceased to support such persons: Re Buckland, Deceased at 411; Kleinig v Neal (No 2) [1981] 2 NSWLR 532 at 537; Mayfield v Lloyd-Williams at [86]. 5. There is no need for an applicant adult child to show some special need or some special claim: McCosker v McCosker [1957] HCA 82, (1957) 97 CLR 566; Kleinig v Neal (No 2) at 545; Bondelmonte v Blanckensee [1989] WAR 305; Hawkins v Prestage (1989) 1 WAR 37 at 45 (Nicholson J). 6. The adult child's lack of reserves to meet demands, particularly of ill health, which become more likely with advancing years, is a relevant consideration: MacGregor v MacGregor [2003] WASC 169 at [179]-[182]; Crossman v Riedel [2004] ACTSC 127 at [49]. Likewise, the need for financial security and a fund to protect against the ordinary vicissitudes of life are relevant: Marks v Marks [2003] WASCA 297 at [43]. In addition, if the applicant is unable to earn, or has a limited means of earning, an income, this could give rise to an increased call on the estate of the deceased: Christie v Manera [2006] WASC 287; Butcher v Craig [2009] WASC 164 at [17]. 7. The applicant has the onus of satisfying the Court, on the balance of probabilities, of the justification for the claim: Hughes v National Trustees, Executors and Agency Co of Australasia Ltd at 149.
A very similar statement of these principles, which I set out in Bowditch v NSW Trustee and Guardian [2012] NSWSC 275, at [111], was cited with approval in Chapple v Wilcox at [21] (Basten JA); and at [65]-[67] (Barrett JA); and was referred to, with no apparent disapproval (although in that appeal there was no challenge the correctness of those principles), in Smith v Johnson [2015] NSWCA 297, at [62].
In Foley v Ellis [2008] NSWCA 288 at [88], Sackville AJA noted that Singer v Berghouse "strongly suggests that the court cannot consider the propriety and adequacy (or inadequacy) of any testamentary provision for an applicant in isolation from the resources and needs of other claimants on the deceased's bounty". The only other claimant on the bounty of the deceased in the present case is the Defendant.
The Defendant, of course, is not an applicant for provision. She does not have to prove an entitlement to the provision made for her in the deceased's Will, or otherwise justify such provision. As a beneficiary, the Court is not entitled to disregard her interest.

Qualifications on "Principles"

As long ago as 1980, in White v Barron (1980) 144 CLR 431; [1980] HCA 14, at 440, Stephen J wrote: "[T]his jurisdiction is pre-eminently one in which the trial judge's exercise of discretion should not be unduly confined by judge-made rules of purportedly general application."
As I have stated in a number of cases (see, for example, Bowditch v NSW Trustee and Guardian), I do not intend what I have described as "principles" to be elevated into rules of law, propositions of universal application, or rigid formulae. Nor do I wish to suggest that the jurisdiction should be unduly confined, or the discretion should be constrained, by statements of principle found in dicta in other decisions, or by preconceptions and predispositions. Decisions of the past do not, and cannot, put any fetters on the discretionary power, which is left largely unfettered. I identify them merely as providing useful guidance, which may be applied, with circumspection, in considering the statutory provisions, the terms of which must remain firmly in mind.
The importance of the qualifications to which I have referred in the last paragraph has been stressed in Chapple v Wilcox by Basten JA, at [18]-[20], and by Barrett JA, at [66]-[67]. They must be remembered.

Additional Facts

I set out additional facts I am satisfied are either not in dispute, or that, in my view, have been established by the evidence. I do so by reference to s 60(2) of the Act. Where necessary, I shall express the conclusions to which I have come. 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 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
As stated, the relationship between the deceased and the Plaintiff is that of child and mother. That relationship existed throughout the Plaintiff's life. I am satisfied that the relationship was a reasonably close one and that it endured until the death of the deceased.
There may have been some conflicts between them, at certain times, but it cannot be said that this is particularly surprising or unusual. Also, the conflict did not last. (It seems that a part of the conflict related to Christopher, but it is to be remembered that for most of his young life, he was living with the Plaintiff, albeit in the home of her parents.)
From about 2003, the relationship between the Plaintiff and the deceased became a little distant, being limited to telephone calls and visits every 6 weeks or so. The Plaintiff asserts that it was the geographical distance between her home at Umina Beach and the Kingsgrove property that resulted in contact between her and her parents becoming less frequent. No doubt it also had something to do with the Plaintiff having a family, which included two young children to look after.
After the deceased was moved to the nursing home, and then to a high care facility, the Plaintiff would telephone her weekly and would visit her about once each month. In the last year of the deceased's life, the Plaintiff would visit the deceased about every six weeks.
(There is some dispute about the regularity of the visits between the Plaintiff and the deceased, the Defendant asserting that it was far less regular than was asserted by the Plaintiff. Really, nothing much turns on determining this since, importantly, the deceased herself did not suggest, in Clause 5 of her Will, or it would seem otherwise, that it was the lack of closeness of their relationship that prompted her to make the provision for the Plaintiff in the Will that she did. To the contrary, her reasons for making the provision that she did related to the financial, and other, support that she had given to the Plaintiff and to the Plaintiff's son, Christopher, to the lack of provision made previously for the Defendant, and to the significant contributions (to which I shall refer) made by the Defendant. (I appreciate that the Will was made in 1998, but there is no evidence of any criticism of the Plaintiff by the deceased.)
Fairly, and correctly, the Defendant did not submit that this case should be decided on the basis of the conduct of the Plaintiff and there was certainly no suggestion of any estrangement between her and the deceased. (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 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 the deceased was expressed by Lord Romer in Bosch v Perpetual Trustee Co Ltd [1983] AC 463 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."
This factor requires a balancing of potentially competing obligations as between the applicant and the beneficiary.
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 the Plaintiff as a child, once she became an adult, imposed upon her by statute or common law. Yet, an obligation or responsibility, to make adequate provision for the proper maintenance, education or advancement in life, continues to be recognised. In Flathaug v Weaver [2003] NZFLR 730 at [32], the origin of the obligation which underpins the Act's recognition of the duty owed by a parent to a child 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."
Yet, there is no "presumptive testamentary entitlement of an [adult] offspring": Underwood v Gaudron [2015] NSWCA 269, at [73] (Basten JA). (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 actual estate is of reasonable value. More important, it seems to me, is the nature of the deceased's estate, consisting only of the Kingsgrove property, in which the Defendant lives, and has lived for almost all of her adult life (some 32 years). (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 currently lives in the Umina Beach property. She is secure in that accommodation. She has a Holden Cruz motor vehicle, cash at the bank and other assets of $36,613. She also has superannuation of $29,566.
Apart from a small credit card debt ($1,400), she has a personal loan ($44,222), part of which has been used to pay her lawyers in these proceedings.
There was a dispute about the current value of the Umina Beach property, the Plaintiff asserting that it was $750,000 and the Defendant asserting (by reference to what appears in documents submitted to the Local Court at Woy Woy), that in April 2016 it was worth $805,000.
The Plaintiff gave evidence that she and her husband had simply agreed on its value at that time and that they did not obtain any evidence of the property's value. However, in the document that both signed, a copy of which was tendered as Ex. 1, the Plaintiff had stated that "[w]here I give any estimate in this application, it is based on knowledge, information and belief and is given in good faith".
On 11 July 2015, the Plaintiff and her husband finally separated. She says that they have entered into a property settlement even though they are not yet divorced. Orders were made on 17 May 2016 pursuant to the Family Law Act 1975 (Cth) by the Local Court of New South Wales, at Woy Woy, giving effect to their property settlement.
Relevantly, those Orders provided that on the Plaintiff's husband reaching the age of 55 years (in April 2018), he is to do all things necessary to pay half of his lump sum benefit received on commutation of his superannuation to the Plaintiff, which half is currently estimated to be approximately $359,000.
On payment of that sum to her, the Plaintiff is to reduce the debt secured by the mortgage on the Umina Beach property (currently $503,727) and is to pay any balance from her own funds. On her doing so, her husband is to transfer all of his right, title and interest in the Umina Beach property to her.
Should the Plaintiff fail to pay the balance of the debt secured by the mortgage within six months of receiving the payment from her husband, the Umina Beach property is to be sold and the net sale proceeds after, inter alia, repayment of the debt secured by the mortgage is to be provided to the Plaintiff.
The Plaintiff estimates that the amount that she will need to pay out the balance of the debt secured by the mortgage, in April 2018, will be $121,988.
Additionally, the Plaintiff and her husband have agreed, although the agreement has not been reduced to writing, that her husband will make the monthly mortgage repayments of $2,687 on the Umina Beach property in lieu of child support payments, which were assessed by the Child Support Agency, in December 2015, to be $1,285 per month.
Ultimately, I do not think that much turns on the dispute as to the value of the Umina Beach property. More important, it seems to me, is the fact that in 2018, if the orders are complied with (and there is no suggestion that they will not be) the Plaintiff will become the sole registered proprietor of a four bedroom property, situated at Umina Beach, with a value of no less than $750,000, and perhaps more, which may then be subject to a mortgage securing a debt of about $121,000.
The Plaintiff ceased work with the NSW Police Force in 2009 after 17 years of service. She received a lump sum of $100,000, including accumulated superannuation and leave entitlements. She also received about $7,000 by way of a worker's compensation payment.
Currently, the Plaintiff works as a disability support worker for Aging, Disability and Home Care in the Department of Family and Community Services. She has recently agreed to an extension of her contract which provides for her to work four days a week. Subsequently, she injured her bicep at work and her working hours were reduced to 6 hours per day, 3 days per week.
Currently, the Plaintiff is working 8 hours per day, 3 days per week but she is still on restricted duties. When she recovers from the injury, she expects to take on additional shifts. I am satisfied that she retains an earning capacity.
The Plaintiff has some concerns regarding her employment continuing as the service in which she is employed is expected to be outsourced to non-government agencies on the roll out of the National Disability Insurance Scheme. It is difficult to know how genuine these fears are as there is no evidence from her employer as to what might occur. Currently, her contract of employment is renewed each 6 months.
In addition to her income from employment, the Plaintiff receives, from Centrelink, a child support payment of $170 per fortnight.
The Plaintiff does not believe that she can afford to borrow sufficient monies to repay the balance of the mortgage over that property. If she is unable to do so, then she will have a fund equivalent to the net sale proceeds of the Umina Beach property after repayment of the balance of the debt secured by the mortgage and associated costs and expenses of sale. Taking the estimated value of $750,000, that would leave her about $600,000, or thereabouts, to purchase a property which would be unencumbered.
The Plaintiff submitted that her "need" is for an amount sufficient to pay off the balance of the debt secured by the mortgage in 2018 (say $122,000) and a capital sum for exigencies of life ($75,000). It was submitted that she should receive a capital sum of about $195,000.
The Defendant, from March 1987 until 2014, worked as a clerk at the Registry of Births, Deaths and Marriages. She was made redundant and her last working day was in June 2014. At that time, she was earning approximately $1,500 net of tax per fortnight. She received a redundancy payment of $57,000 but has spent all of the money she received. She has not worked since her retrenchment.
Currently, and excluding the Kingsgrove property, the Defendant has no accessible assets of any value. She is reliant on the Newstart Allowance of $504 per fortnight. There was evidence (Ex. F) that the annual income that the Defendant receives is $13,106, and that the cost of the services for which she pays in relation to the Kingsgrove property (council rates, electricity, water rates, insurance and telephone) is $5,172. (It may be that if the Kingsgrove property is transmitted into the Defendant's name, her expenditure for rates will decrease.) Therefore, after the payment of the expenses for the Kingsgrove property, she has available for all other expenses about $152 per week.
The Defendant gave evidence about her superannuation in her affidavits, which evidence was wrong. (I am satisfied that she did not give the erroneous evidence with the intention of misleading the Court but because she appears to be financially unsophisticated. In addition, since she believed that she could not get access to the superannuation funds until she reached 60 years of age, I am satisfied that she did not pay attention to the documents that she had received.)
The copy of Annual Statements produced by State Super SAS Trustee, for the years ending 30 June 2014 (Ex. B), 30 June 2015 (Ex. C) and 30 June 2016 (Ex. D) reveal that the immediate lump sum payment and the deferred lump sum payment has increased from about $85,012 to $149,600.
Counsel for the Plaintiff did not submit that either the immediate lump sum payment or the deferred lump sum payment could be released upon the request of the Defendant and be used by her to satisfy any order for provision made in favour of the Plaintiff. Nor did counsel seem to dispute the submission, made on behalf of counsel for the Defendant, that any payment (other than $10,000) could not be released until 2026 (when the Defendant is 60.)
The Plaintiff accepted that the Defendant would have to sell the Kingsgrove property to enable her to receive the amount that she was seeking by way of family provision order, or any part of it. At T28 - T29, the Plaintiff, gave the following evidence: "HIS HONOUR Q. As I understand the submissions made on your behalf A. Yes. Q. at least one element of what you are seeking is sufficient to enable you to pay off what you estimate the mortgage secured on the house will be? A. Yes. … Q. At least since 1984, she's lived in the Kingsgrove property. You lived in the Umina Beach property since 2004, I think you told me earlier. So, the effect of what you're seeking is that the house in which you live should be retained but the house in which she has lived for many years more should not be retained, is that the effect of what you're seeking? A. She, I just, I wanted something that's small. It's crumbling down. It's, it's, it's very (witness indicated). Q. It's very? A. It's, it's very old. It's crumbling down. The carpet stinks. There's holes in the kitchen. Wind comes through in winter. The bathroom is in disrepair. She can't maintain it."
The Defendant stated that as she has lived there since December 1984, she wishes to remain living in the Kingsgrove property. She acknowledged that her income meant that she had to pay large expenses by instalments; that, hypothetically, if she had expenses for other repairs to the Kingsgrove property, she would not be in a position to pay those other than by instalments; that she would need to find a repairer who was prepared to be paid in this way before she would be able to carry out the repairs; and that she had sought the assistance of a charitable organisation, and then had contacted the local Council, to try to get someone to come and mow the lawns.
Notwithstanding her modest income and the difficulties identified, the Defendant's resolve to live in the Kingsgrove property means that, currently, she makes ends meet and pays her liabilities as best she can.
As the Defendant stated in answer to questions from counsel for the Plaintiff at T48.04 - T48.29: "Q. …Can I just go through with you what you spend on yourself each week. Starting with the basic things, food. How much would you spend on food each week? A. Um, I'd buy things like food, things daily. I don't really calculate it to know for sure what I spend, not very much. Q. What's "not very much", $20? A. Um, could be about $60 a week. Q. Less than $10 a day you say? A. Approximately, yeah. I don't really think too much about it because if you think too much about it, it affects you. You just get by as best you can. If you look at all your bills in those amounts, it's distressing. You just pay what you can. You buy what you can. You eat what you can. I don't sit down calculating it. I just get by as best I can. Q. So you compromise with what you would like to have and buy a bit less that you actually can afford? A. You just live with what you've got. Q. If you had a bit more money obviously you wouldn't have to compromise in that way, would you? A. That's right. Q. That would be a better thing for you in your life style, wouldn't it? A. No. I would rather just live in my house and just live the way I live."
There is no reason to disbelieve her evidence in this regard. (e) if the applicant is cohabiting with another person - the financial circumstances of the other person
The Plaintiff's daughter, Nikki, is in Year 11 at Woy Woy High School and lives with the Plaintiff. Her son, Aleksander, lives with them. Neither gave evidence in the proceedings as to their future aspirations. Neither of her children are said to contribute to household expenditure.
Aleksandar earns approximately $600 per month as a barman. At the hearing, with leave, the Plaintiff gave oral evidence that Aleksander's girlfriend, Chloe Toulsen, had moved into the Umina Beach property about 3 or 4 months ago. Although she had agreed to pay $150 per week, she has only made two payments. She is currently employed, although there was no evidence of the income that she earns. No explanation was given by the Plaintiff of the reasons why the agreed payments have not been made, or why the Plaintiff has not sought those payments from Aleksander's girlfriend.
The Plaintiff was cross-examined about the future and whether each of the two children was likely to remain living with her. Naturally, her answers demonstrated uncertainty, as she stated that each did not know what would happen in the future.
Doing the best I can with the evidence currently available on the topic, I tend to the view that both of the Plaintiff's children are likely to remain living in the Umina Beach property until at least April 2018. What happens thereafter, in my view, is mere speculation. (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
The Plaintiff describes her health as "fair". She says that she suffers from hypertension and migraines. She continues to suffer pain from the thoracic outlet syndrome developed whilst working.
A medical report dated 4 February 2015, reveals that she suffers diverticular disease, psoriasis and dermatitis. She is taking various medications.
The Defendant has suffered depression from childhood. Her depression became worse following the death of the deceased. Whilst she has seen a psychologist on occasions, she says that she cannot afford to do so as regularly as she would like. (g) the age of the applicant when the application is being considered
As stated, 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 gave some evidence of her contribution to the acquisition, conservation and improvement of the deceased's estate. She said that as a child, she filled out forms for the family, such as Census forms, hospital forms, and school and enrolment forms. She says that throughout her life, she often translated for her parents at medical appointments and when she returned to live in the Kingsgrove property, she would drive them to those medical appointments.
She said that she left school at the end of year 9, and at the age of 15 or 16 obtained employment. She paid part of her weekly salary to her parents.
She says that it was she who assisted her parents to sell the Redfern property by contacting the office of the local Member of Parliament, whose offices assisted her to commence negotiations with the government to purchase the Redfern property. She says that she assisted her parents in dealing with the real estate agent at the time of purchasing the Kingsgrove property. (I tend to the view that both of the parties assisted in regard to the sale of the Redfern property, although in 1983, both were in their teens.)
During her occupation of the Kingsgrove property following the breakdown of her first marriage, she paid board of $80 per week to her parents. She says that she also paid for groceries and contributed to other outgoings such as the utilities and the telephone. (There is some dispute about this but, really, not much turns on it.)
She says that when her father died, she organised the funeral service and the headstone. She made most of the other arrangements. She and the Defendant were named as the executors of his Will, which provided for the whole of his estate to pass to the deceased.
The Plaintiff gave evidence of raising a number of concerns about the state of health of the deceased and her ability to look after herself with the Defendant.
The Defendant, as the only person who lived with her parents, at least from about 1998 (other than on occasions when Christopher returned), made a significant contribution to each of them. This is demonstrated by the deceased's statement in the Will and the evidence of the Defendant. The contribution including paying board and other expenses associated with the Kingsgrove property.
I have no doubt that it was the Defendant who had the primary responsibility of looking after the deceased, particularly after the death of the deceased's husband in 2010. I also accept the Defendant's evidence of the closeness of her relationship with the deceased which was not the subject of any real challenge by the Plaintiff.
The Defendant contributed $3,000 towards the funeral expenses of the deceased. The balance ($3,000) was paid from funds in the deceased's bank account at the date of death. She has not sought the payment to her of the amount contributed. (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
The Plaintiff acknowledged that she received some financial assistance from the deceased during the deceased's lifetime. She wrote in her affidavit that her parents paid $1,000 for the reception at her first wedding; they bought her a bedroom suite; they gave her $10,000 at the time of second wedding and that, after she obtained her driver's licence in about 1988, they purchased a car for her for $2,000. (I have earlier referred to the deceased's statement to the effect that she and her husband had given her financial assistance totalling about $25,000 and the costs of looking after and caring for Christopher.)
Each party tendered documents which were said to go to the availability of alternative accommodation. Each submitted that the other party could, if necessary, "downsize" with the result that her accommodation needs would be well met. Counsel for the Plaintiff acknowledged that whilst it may be accepted that the Defendant's needs are greater than those of the Plaintiff, and should for that reason take a degree of precedence, provision could still be made for the Plaintiff which took that into consideration.
The Plaintiff accepted in cross-examination that she could buy a three bedroom villa, or townhouse, in the Umina Beach area for between $450,000 and $550,000, well under the net amount that would be available to the Plaintiff upon the sale of the Umina Beach property.
As stated, the Plaintiff receives nothing from the deceased's estate since there is no property that falls into residue. (j) any evidence of the testamentary intentions of the deceased person, including evidence of statements made by the deceased person
The Plaintiff gave evidence of having a conversation with her father at the time of her marriage to her second husband, in which he said to her that he and the deceased thought that the Defendant should receive the Kingsgrove property on their death. (The father of the parties, of course, is not the "deceased" whose testamentary intentions are relevant.)
The Plaintiff also says that the deceased continued to say to her after her marriage that "Everything will be 50-50". Although not the subject of cross-examination, I find it improbable that the deceased would say that to the Plaintiff in light of the terms of her Will and bearing in mind the Defendant had lived, and was continuing to live, with her.
I have earlier stated the terms of the deceased's last Will. It seems to me that the deceased's statement in her Will is of significance. (Of course, I appreciate that the deceased's statements should not be regarded unreservedly. The weight to be attached to any statements by the deceased will depend on the circumstances. The statement should not be viewed uncritically and reasons may be shown to demonstrate that the statements made are incorrect or misconceived.)
It was submitted by counsel for the Plaintiff that the statement made in the Will was of less significance bearing in mind the length of time that had passed since the deceased's Will was made. However, part of the statement made in the Will related to historical facts; the balance related to the accommodation needs of the Defendant as compared with those of the Plaintiff. Those needs were the same at the time the Will was made as they were at the date of the hearing.
In addition, it is not suggested that the deceased subsequently sought to alter her Will or make statements inconsistent with what she had written in what was her last Will.
There is also no suggestion that, at the time at the date of her death, the deceased was aware of the separation of the Plaintiff and her second husband. Their property settlement occurred after the death of the deceased, and essentially ensures the Plaintiff's security of accommodation until at least April 2018. Even then, if the Umina Beach property is sold, there will be a significant sum available, being the net proceeds of its sale. (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, wholly or partly, by the deceased other than historically as a child and during the period after the breakdown of her first marriage and prior to her second marriage. In fact, the Plaintiff admits that she was financially independent of the deceased after she left home to marry in 1996.
The Defendant and the deceased were inter-dependent throughout the Defendant's adult life. (l) whether any other person is liable to support the applicant
There is no person, other than her estranged husband, liable to support the Plaintiff. Indeed, he is paying the instalments due under the mortgage ($2,687 per month) and the costs of private health insurance for the Plaintiff and their children. He does not pay the Plaintiff child support but contributes to the costs of their monthly mobile telephone bills for both of the children.
I have earlier referred to the social security benefit received by the Plaintiff in respect of her children. (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."
I am satisfied that there is no relevant conduct of the Plaintiff before, or after, the death of the deceased. I have dealt with her relationship with the deceased earlier.
The Plaintiff, in my view, within the constraints of having her own family to look after, did what she could to assist the deceased. I must also bear in mind that there was a geographical distance between their two homes. (n) the conduct of any other person before and after the date of the death of the deceased person
I am satisfied that the conduct of the Defendant impacts on the determination of what provision should be made for the Plaintiff out of the estate of the deceased. She was a loving daughter to the deceased and was the deceased's principal carer. The personal care she provided, particularly in the deceased's last years before the deceased was moved into the nursing home, and the assistance the Defendant provided with activities of daily living should not be underestimated. There can be no doubt that the Defendant has a very strong competing claim on the bounty of the deceased, which, of course the deceased recognised by making her the principal chosen object of the deceased's bounty. Yet, it cannot be forgotten that the Defendant received subsidised accommodation for all of her adult life whilst she has lived in the Kingsgrove property. (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.

Submissions

Counsel for the Plaintiff submitted that the estate is sufficiently large for provision to be made for both the Plaintiff and the Defendant.
He then submitted that as the Plaintiff receives no provision under the deceased's Will, adequate provision for her proper maintenance or advancement in life had not been made and that the Court should assess what provision ought to be made for the Plaintiff.
Counsel accepted that whilst respect should be paid to the terms of the deceased's Will in determining who should receive her testamentary bounty, the Court should intervene because no provision for the Plaintiff was being made under the Will because there was no residue.
He also submitted that circumstances had changed since the deceased reflected upon such matters in 1998 and when she set out the considerations in Clause 5 of the Will. Importantly, he said, at the date of determining the Plaintiff's claim, it was not now accurate to say that she "has her home assured".
He submitted that the value of the estate was sufficient for the Defendant to be able to afford alternative accommodation which would provide her with a home that was not dilapidated and requiring significant repair and renovation.
I have referred to the Plaintiff's submissions on the quantum of the provision that "ought" to be made.
The Plaintiff stated in her affidavit sworn 11 October 2016 that she would be content if the lump sum were not paid to her immediately, but was deferred for a period of six to twelve months, which would allow time for the Defendant to find alternative accommodation and for the Kingsgrove property to be cleaned and otherwise made ready for sale and sold.
The Defendant's counsel submitted that the Plaintiff's Summons should be dismissed. It was put: "The parties have agreed the value of the Kingsgrove property is $970,000 less $25,000 of sale costs. The net distributable estate is therefore $945,000. This figure fails to take into account the plaintiff's undisturbed evidence that to sell the property, the cost to clean, maintain and repair the Kingsgrove property, of $100,000, would have to be spent on the property. That would mean, not allowing costs orders or any provision, the Estate would be $845,000. If provision is made to the plaintiff and a costs order made, the estimate of the plaintiff's costs would be $64,220. The value of the Estate (not including provisions but including a cost order) will therefore be: $780,680, before any provision is made to the defendant."
I have earlier stated that whilst there was evidence that the costs of repairing and cleaning the Kingsgrove property would be "substantial", the evidence does not enable me to conclude that those costs will be $100,000. Allowing, say, an estimate of $50,000, the net distributable estate would be in the order of $895,000, before any provision was made for the Plaintiff and her costs were paid.

Determination

Claims for a family provision order present particular difficulties where the actual estate is not large, where the only asset is the property in which the beneficiary lives, and where there are competing claims upon the bounty of the deceased. Any provision made by the Court in favour of an applicant must, in this class of case, be made at the expense of the beneficiary who has had to defend the claims and who is the principal chosen object of the deceased's bounty.
As I have recently written in Morier v Liem [2016] NSWSC 582, the fact that the Plaintiff does not receive any provision under the Will of the deceased, of itself, does not bespeak inadequacy. That fact is not all that the Court is required to consider. The totality of the relationship of the Plaintiff and the deceased, the age and capacity of the Defendant, the claim of each on the bounty of the deceased, and the size of the estate and notional estate, are very relevant factors in determining the answer to the question whether the Court is 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.
Unsurprisingly, counsel for the Defendant were not prepared to concede that the lack of provision meant that there was an inadequacy of provision. However, they accepted that in determining the jurisdiction of the Court to make an order it was necessary to consider, amongst other things, the Plaintiff's financial circumstances and the fact that she is now separated from her husband, it would appear irreconcilably. (Importantly, the question of adequate provision is to be assessed at the time when the Court is considering the application.)
However, as Basten JA wrote in Chan v Chan [2016] NSWCA 222 at [22], the Court must remember: "A significant set of factors in many cases is that identified as "the financial resources (including earning capacity) and financial needs, both present and future, of the applicant…". However, it is important not to elide the distinction between needs and adequate provision; the former is but one indicator of the latter. The adequacy of provision is not to be determined by a calculation of financial needs. The background to any consideration of the appellant's needs required determination of the size of the estate and the claims of others on the beneficence of the testator."
Thus, in determining what is adequate for the proper maintenance, education or advancement in life of an applicant, the Court also considers the nature, extent and character of the estate and the other demands upon it, and also what the deceased regarded as superior claims or preferable dispositions.
In devising the Kingsgrove property to the Defendant, the deceased effectively, and in my view, understandably, recognised that the Defendant had a substantial need for accommodation, which need the deceased had met throughout her lifetime.
But, the Defendant, at least currently, has no means to maintain, or repair that accommodation, or to support herself, other than frugally, whilst she lives in it. The Kingsgrove property is also in a somewhat rundown state. Yet, the Defendant has lived there since 1984, albeit in more recent times in a manner which may not be regarded as comfortable by community standards, and she has expressed a keen unwillingness to move.
In my view, it is unsurprising that the Defendant has formed an attachment to the Kingsgrove property. Moving is likely to cause her anxiety and distress. In this regard, I take into account her medical condition, which was not the subject of any challenge. I also note that the deceased recognised the Defendant's emotional attachment to the property in her Will, when she wrote that "Carol has always lived in the family home at Kingsgrove and it would be a great emotional wrench for her to leave it". It must be borne in mind that the Defendant has lived there for another 18 years since the Will was made.
In addition, when shown an example, the Defendant did not accept that such alternative accommodation would provide her with the amenities and the same sense of security that she presently has in the Kingsgrove property (with all its lack of amenity).
It is true, as counsel for the Plaintiff submitted, the Defendant requires money to pay for medical treatment, to repay debts, to make repairs and do maintenance in respect of the Kingsgrove property. No doubt, she could also use a fund for the exigencies of life and to make her existence, which is frugal, more enjoyable. However, it is unlikely that the sale of the Kingsgrove property, after the making of the provision sought by the Plaintiff and the purchase of alternative accommodation in which the Defendant could live, would provide a fund large enough to attend to all of her requirements.
The Defendant, who is as demonstrated by her cross-examination, herself, in financial need, would be significantly prejudiced if any provision were now made in favour of the Plaintiff.
As stated above, the importance of freedom of testation cannot be forgotten. To require the Kingsgrove property to be sold would be to ignore the clear intention of the deceased that the Defendant should be able to continue to reside therein, as she had done for so many years.
Then, considering the position of the Plaintiff, the deceased had no obligation to maintain the Plaintiff at any time after she became an adult. She and her husband, as parents and grandparents, did so by providing accommodation, and other financial support before, and between, the Plaintiff's marriages. However, for many years prior to the deceased's death, the Plaintiff had been financially independent of the deceased.
Nor did the deceased have any obligation to treat her two children equally in the circumstances of this case.
Currently, the Plaintiff is secure in the Umina Beach property. The payment of the mortgage instalments by her husband reduces her current financial obligations which seem to be met from her income. Although it may be that both of her children will remain living with her in 2018, what either will do thereafter is uncertain. Then, depending upon the circumstances, the Plaintiff may retain the Umina Beach property, or sell it and buy something a little smaller. If the Umina Beach property were then to be sold and appropriate alternative accommodation purchased, the Plaintiff is unlikely to have the burden of a mortgage, or at least a large mortgage. If it is not sold, the burden of the estimated debt that would then be secured is relatively small compared with the then value of the Umina Beach property.
Furthermore, the Plaintiff has an earning capacity and, although currently on restricted duties, she earns a reasonable income and expects to have a greater income when she is not on restricted duties. I accept that she has some concerns about her future employment but I am not satisfied that those concerns lead to the conclusion that she will become unemployed or, thereafter, will be unemployable.
Although this is not an easy case, the consideration of all of the matters I am required to consider, leads me to conclude that I am not satisfied that there was a failure, on the part of the deceased, to make adequate provision for the Plaintiff's proper maintenance or advancement in life. It follows that the Court has no jurisdiction to make an order for provision out of the estate of the deceased for her. In particular, the nature of the deceased's estate, the significant, and very strong, competing claim of the Defendant, taken with the deceased's testamentary intentions, are very important.
Because an applicant for provision has been a dutiful child of the deceased, does not, necessarily, mean that an order for provision, or further provision, out of the deceased's estate ought to be made. Similarly, unequal distribution of a deceased's estate is not sufficient, of itself, to warrant disturbing a testamentary disposition.
In the event that the conclusion is wrong, I would not, in the exercise of discretion, make an order in favour of the Plaintiff. The Will amply demonstrates that the deceased did give due consideration to the competing claims of the Plaintiff and the Defendant and weight should be given to her wishes. Even though the Will was made some years before her death, it was not changed at any time subsequently and the Defendant continued living with the deceased as she had done for the whole of her lifetime. Effectively, what the Plaintiff is asking the Court to do is to rewrite the unambiguous, expressed, and reasoned intentions of the deceased in order to make provision for her.
The making of an order in the Plaintiff's favour would result in her possibly being able to retain the Umina Beach property in which she has lived for a little more than one decade, whilst to make such an order would inevitably require the sale of the Kingsgrove property in which the Defendant has lived for over three decades. The Kingsgrove property would have to be sold with the consequence that the Defendant would lose the home that the deceased sought to provide from her limited resources.
It follows that the Plaintiff's Summons must be dismissed.
I turn to the issue of costs. One of the general principles regarding costs is that they usually follow the event, and this principle is not to be departed from solely on the basis that the proceedings involve a deceased's estate and a claim for a family provision order. More often than not, such claims, as this one was, are conducted as any other civil adversarial claim.
Yet, the Court's discretion to order a party to pay costs must be exercised in a way that achieves justice between the parties. This often requires an examination of a range of potentially competing considerations. Ultimately, what is the appropriate cost order in any given case involving a claim for a family provision order, will depend on a range of factors, including an assessment of the merits of the proceedings, whether they were reasonably brought, the nature and value of the deceased's estate, the competing claim of any beneficiaries, and the overall conduct of the litigation.
One can well understand the sense of grievance felt by the Plaintiff, as a child of the deceased, in receiving no provision out of the deceased's estate. This does not mean, however, that she should receive her costs out of the deceased's estate. The Plaintiff was well aware of the nature and value of the deceased's estate at the time she commenced her proceedings. Perhaps a more realistic appraisal by her of the possible result of the proceedings might have resulted in the proceedings not being commenced. Furthermore, the Plaintiff's financial position has been worsened because she borrowed funds to pay some of her costs of the proceedings.
An order that the estate should bear the Plaintiff's costs of the application would effectively amount to the Defendant bearing those costs which would have the consequence of the sale of the Kingsgrove property. In addition, such an order would produce an injustice to the Defendant when the Plaintiff has not been successful in the proceedings.
Yet, I am of the view that the Plaintiff should not be ordered to pay the Defendant's costs, even though the gross sum costs estimated by the Defendant's legal representatives, appears reasonable. (In this regard, I note that in Ghosh v Miller (No 4) [2016] NSWSC 1710, at [12], Schmidt J explained that "the purpose of the power granted by s 98(4)(c) Civil Procedure Act is to award a specified gross sum instead of assessed costs, in order to avoid the expense, delay and aggravation which may arise out of the assessment process. Such orders will be made where assessment will disadvantage the successful party; where the unsuccessful party's conduct has unnecessarily contributed to the costs of the proceedings; and where further assessment is likely to be unduly protracted and add to costs unnecessarily", which principle would be apt to this case.)
A relevant consideration in reaching this conclusion is that the Plaintiff incurred some of the costs that would normally be incurred by a defendant in such proceedings, when her solicitors prepared, and served, the notice of claim and the two administrator's affidavits, whilst the Defendant was self-represented. In addition, she has contributed $700 to the debts funeral and testamentary expenses of the deceased and by taking this into account, she should not seek reimbursement. In reaching my conclusion on the issue of costs, I repeat that all of the legal representatives of the Defendant, by their generosity of time and assiduous effort, have assisted the Defendant, in a practical way, in being able to retain the home in which she has lived for so long. The Defendant should be, and the Court is, most grateful to the legal representatives for appearing, as they did, to assist the Defendant. Finally, to make the order sought would benefit the legal representatives of, but not, the Defendant, who does not have any personal liability to pay any costs or disbursements to them.
The Court: 1. Orders that the Plaintiff's Summons be dismissed. 2. Makes no order as to the costs of either party, to the intent that the Plaintiff will bear her own costs of the proceedings. 3. (c) Notes that the Defendant is not liable for any costs of the proceedings. 4. (d) Directs that the Exhibits be dealt with in accordance with the Uniform Civil Procedure Rules 2005 (NSW) (rule 31.16A and rule 33.10), and Practice Note No SC Gen 18 (Para 26).

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Family Provision Act 1982(NSW)

McKenzie v Topp [2004] VSC 90 Morier v Liem [2016] NSWSC 582 Pontifical Society for the Propagation of the Faith v Scales [1962] HCA 19; (1962) 107 CLR 9 R (on the application of M) v Slough Borough Council [2008] UKHL 52; [2008] 1 WLR 1808 Re Buckland, Deceased [1966] VR 404 Salmon v Osmond [2015] NSWCA 42 Singer v Berghouse [1994] HCA 40; 181 CLR 201 Smith v Johnson [2015] NSWCA 297 Stern v Sekers; Sekers v Sekers [2010] NSWSC 59 Stott v Cook (1960) 33 ALJR 447 Taylor v Farrugia [2009] NSWSC 801 Underwood v Gaudron [2015] NSWCA 269 Verzar v Verzar [2012] NSWSC 1380 Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191 Walker v Walker (Supreme Court (NSW), Young J, 17 May 1996, unrep) White v Barron [1980] HCA 14; 144 CLR 431 Wilcox v Wilcox [2012] NSWSC 1138 Category: Principal judgment Parties: Ms Anastasia Petkovic (Plaintiff) Ms Carol Koutalianos (Defendant) Representation: Counsel: Mr C F Hodgson (Plaintiff) Mr J Brown and Ms M E Hall (Defendant)

Petkovic v Koutalianos

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