Pillinger v Lees

The parties and their financial circumstances

1. I will consider the position of each family member in turn.

Anecia

1. After their marriage on 27 July 1981, Anecia and Bruce purchased a house at 34 Lang Street, Croydon. Bruce travelled frequently for work and, shortly after they were married, Anecia stopped working to care for their children.
2. Between 1994 and 1998, Anecia owned and ran a small takeaway shop. She worked as a nurse between 1998 and 2003 but has not worked since that time. The income that she earned was always used to pay for family expenses.
3. On the death of his father in 1987, Bruce inherited the Balmain properties, then on two titles. The Llewellyn Street property and the Little Darling Street property now share a common boundary but were originally on a single title. Bruce renovated each of the properties at different points and they were all rented out.
4. In 1987, Anecia's children from her earlier relationships travelled to Australia to live with her and Bruce. Aldwin lived with them very briefly and has not done so since. Bruce formally adopted Vanessa in 1995 but she now lives with her family in the United Arab Emirates.
5. Bruce purchased the Razorback property in 1994. At the time, the property contained a four-bedroom house and a two-bedroom granny flat. No-one said so explicitly, but I infer that they sold the Croydon property and moved to the Razorback property at about that time.
6. In July 2019, Anecia and Bruce decided to build a new home on the Razorback property because the main house was in poor condition and was no longer suitable for them to live in. The house was demolished in July 2020 and they moved into the granny flat. They lived in the granny flat up until January 2022, when Bruce died.
7. The granny flat on the Razorback property is no longer habitable. Its roof has become unsafe and the building has damp and asbestos issues. It was already in a poor state in July 2020 when they moved into it and it has not been maintained since.
8. Anecia and Bruce signed a contract with Metricon to build a new home on the Razorback property in March 2021 at an estimated cost of about $527,000. In total, they paid $26,780 as a deposit. In May 2021, Bruce obtained approval for a loan from the Commonwealth Bank of Australia in order to complete the construction. They had originally hoped that they would be able to pay for the new home out of savings. However, the real cost of building with Metricon turned out to be much more than their initial estimate, partly because of the impact of the COVID-19 pandemic. Bruce was unable to secure a commitment for a loan sufficient to cover the cost.
9. By about August 2021 Bruce had decided to sell one of the Balmain properties in order to fund the construction of the new house at Razorback. An additional consideration which Bruce had in mind at this point was that the sale of one of the Balmain properties would also allow him to give $1,000,000 to David instead of leaving anything for him in his Will. He told Anecia that this is what he intended to do. He believed that David had agreed to it, but I will say more about this proposition below in the context of dealing with David's evidence.
10. Anecia's evidence as to Bruce's intentions at this time included the following: "In August 2021 Bruce said to me: 'I have finally decided to sell the Little Darling Street property. This will allow me to give David $1million, and we will have funds to build our new home on the Razorback property. Once the payment is made to David, he will not receive any part of my estate when I die. David is happy with this. I have told Khristine that, if she agrees to Little Darling Street being sold, I will give her the Montague Street property. She agreed to this.'"
11. This was not an idle thought. Bruce spoke with Khristine about this proposal and she even took steps to begin preparing the Little Darling Street property for sale.
12. However, in the events that happened, the plan did not proceed. Bruce's health declined and he was admitted to hospital on a number of occasions due to recurring heart complications.
13. Since Bruce's death on 26 January 2022, Anecia has been living with Khristine and her family at the Little Darling Street property. She greatly enjoys living in Balmain. She regularly attends a local church, which means much to her. She has local friends and attends a local gym. Living in close proximity to her daughters appears to have been good for her general wellbeing in the years following Bruce's death.
14. Gina gave evidence to suggest that there was some tension in the relationship between Anecia and Bruce. There may have been tension from time to time, but Anecia admits as much. I nonetheless accept Anecia's evidence that the relationship was generally a loving and supporting one.
15. Anecia has suffered some health issues in recent times, including a thyroid problem, high cholesterol, bowel problems and bone density issues which affect her joints.
16. Anecia receives aged care allowance of $1,024 per fortnight, which is her only source of income. Her expenditure presently comes to about $2,000 per month, but I note that Khristine pays for most of her food expenses and that she does not presently have to pay any rent. Her evidence is that she would like to have sufficient provision to allow her to meet monthly expenses of about $6,151 per month over the next 14 years, which is her approximate life expectancy. The figure of $6,151 per month is of course only an estimate.
17. Anecia owns land in the Philippines of no more than nominal value. She owns a car worth about $12,000. She has no liabilities.

Gina

1. Gina is currently 42 years of age. Her husband, James, is 46 years of age. They have two children, Cameron born in 2014 and Jacqueline born in 2017. Their niece, Tigerlily, also lives with them and they care for her. Tigerlily is Tyrone's daughter, although for reasons to which I will come, parental responsibility for her rests in the Minister for Family Services pursuant to an order under the Children and Young Persons (Care and Protection) Act 1998 (NSW).
2. Gina and James own their own home in Russell Lea which they purchased in January 2022 after selling their previous home in Wareemba. The balance owing on their mortgage is about $1,600,000. The mortgage is in arrears and they have a financial hardship arrangement in place with their lender. They recently signed a sale agreement with an agent to sell the Russell Lea property.
3. Gina is an assistant border force officer. Her gross monthly income is about $4,400. She also receives a carer allowance of about $307 per month for Jacqueline and of about $1,908 per month for Tigerlily.
4. James has his own advisory business from which he draws about $11,829 per month.
5. Together, their income net of taxes is about $12,000 per month.
6. Gina and James currently have monthly expenses that exceed their net income by a margin of several thousand dollars. A very significant portion of their monthly expenditure is for the mortgage on the Russell Lea property.
7. Gina has superannuation of about $190,000. James has superannuation of about $127,000. They have small credit balances in their savings accounts.
8. Gina is studying part-time to earn a graduate degree in criminal justice from Charles Sturt University. She has a HECS debt of $35,561, which will increase. She has spent about $24,000 in legal expenses in connection with these proceedings.
9. James' business is conducted through companies that have little by way of assets. He appears to have been drawing funds from the business in a way that has attracted the operation of Division 7A of the Income Tax Assessment Act 1936 (Cth) and, as a consequence, is now likely to have a reasonably significant tax bill for recent years.
10. Gina's daughter, Jacqueline, is currently six years old. She is a type 1 diabetic. When she was 10 months old, she suffered an episode of diabetic ketoacidosis which resulted in a stroke. This resulted in significant permanent brain damage involving a loss of approximately 27% of her brain function. She requires and will continue to require support for speech, occupational and behavioural therapy, as well as other physical and psychological treatments. She has been diagnosed with a mild Global Development Delay and has an NDIS support plan. She may be dependent on Gina and James for the rest of her life.
11. There is uncertainty about what the future holds for Jacqueline. Her NDIS support will be reviewed when she reaches seven years of age.
12. Tigerlily is nine years old. Tyrone, her father, is currently incarcerated. Her mother has no interest in raising her and in any event has no capacity to do so. In 2021, Tigerlily was removed from her parents due to welfare concerns. She spent time in foster homes, of which there were several because of her behavioural issues, her high level autism (Level 3) and other issues related to social and childhood trauma. She requires ongoing support in the form of speech, occupational and behavioural therapies. She also requires other physical and psychological treatments.
13. Gina and James are committed to Tigerlily living with them. There is also an NDIS package approved for Tigerlily, but it does not cover all of the costs associated with her living with them and may not cover her school fees if, as Gina would like, she attends the same high school as Jacqueline. It is Gina's belief that Tigerlily will be dependent on, and living with, Gina and James for a considerable time.
14. Gina and her family do not live an extravagant life. They work hard but have not been able to afford a family holiday, even to visit Gina's half-sister Vanessa. They have not been able to afford to upgrade basic items like their car and white goods for some time.
15. Gina has a particular sentimental attachment to the Llewellyn Street property although she has never lived there. It has been in her family for over 60 years and she would visit it frequently with her father. I accept her evidence that Bruce often said that he would leave that property to her, although this is not a matter on which I place much weight. Its only relevance is that it underscores the fact that Gina, like her sister and mother, have particular sentimental reasons for wishing that these proceedings are resolved in a way that allows the Balmain properties to stay in the family.
16. Gina had a close and loving relationship with her father. She spoke with him often and they spent time together. She does not at present have a very close relationship with her mother or her sister, but nothing really turns on that fact.

Khristine

1. Khristine is currently 37 years of age. She is married to James who is 41 years of age. They have two children, Oliver and Scarlett, who are six and four years old, respectively. At the time of the hearing, Khristine was expecting a third child, due in September 2024.
2. Khristine and James own a townhouse in Denham Court which she estimates to be worth about $880,000. They own it as tenants in common as to 99/100 to Khristine and as to 1/100 to James. There is a mortgage of $560,000 on which they are jointly liable. They have joint bank accounts with modest deposits. They have other assets including some cryptocurrency worth about $20,000 in total. James is presently pursuing employment related entitlements of about $100,000 from a former employer in Qatar.
3. Together, Khristine and James have superannuation of about $370,000. Khristine is owed some money by Tyrone.
4. Khristine is a demand manager for Nestle Purina at Rhodes and has net monthly earnings of $8,330.70. James works for Qantas at Mascot and his net monthly income is $7,821.99. That figure is expected to increase in October 2024 after a novated lease arrangement for his car ends. They receive rent of $720 per week for the Denham Court property which is applied towards (but does not cover) the mortgage. They have rental expenses averaging about $386 per month for the Denham Court property.
5. Khristine expects to take maternity leave from about September. She will receive 20 weeks paid leave but does not intend to return to work for some longer period after that. During that time, they will be dependent on James' income. They will need to make some sacrifices to make that arrangement work.
6. Khristine and James have monthly expenses of about $14,600 but that will reduce to about $13,000 when James' novated lease arrangement ends.
7. In May 2022, Scarlett was preliminarily diagnosed with autism (Level 3). An early intervention program was prepared and an NDIS case officer was allocated. A formal diagnosis of autism (Level 2) was reached in September 2022. She has required continuing occupational, feeding and speech therapy since that time. Scarlett attends two to three one hour-long sessions of therapy each week in Leichhardt with one or other parent. The cost of this therapy is covered by an NDIS plan which they expect to remain in place for two more years. Her future therapeutic needs are unclear. She may yet need to attend a specialist school for up to five years.
8. Khristine and James would like their children to attend private schools.
9. Khristine and James moved into the Little Darling Street property in late 2017. In June 2018, they moved to Qatar for James' work. They moved back to Australia briefly at the end of 2019 and they took a rental property in Lilyfield, which was convenient for her work. After a short time, James was required to go back to Qatar for work. Khristine and the children moved back to Qatar also, but not until September 2020. They all eventually decided to return to Australia permanently in the middle of 2021. One of the main reasons they decided to move back at that time was so that Khristine could spend more time with her father, who was becoming increasingly unwell. Shortly after their return they moved into the Little Darling Street property where they paid $700 per week in rent, as well as water and council rates.
10. Anecia and Bruce often stayed with Khristine and her family at Little Darling Street.
11. Bruce and Khristine spoke most days. She recalls a discussion with him in about August 2021 in which he said that he and David had agreed that he would sell the Little Darling Street property and give $1,000,000 of the proceeds to David as his inheritance. I accept that this discussion occurred in the terms recalled by her: "In August 2021 my father and I had a conversation to the effect of: Father: 'David and I have agreed that Little Darling Street property will be sold. If you are willing to give it up, which is your inheritance to make your mother happy so she can build a better house and I can give David his $1million then you get Montague Street.' Me: 'Yes that would be suitable for me. You need to make sure you update your Will.' Father: 'Ok. I will sort out changing my Will but I can't leave the house to go and see Garry [referring to his solicitor] because of the lockdowns [referring to the COVID-19 lockdowns in place at the time as he was in a local government area that was restricted to 5 kilometres travel from home].' Me: 'If I get Montague [referring to Montague Street property] I can renovate it and put in a proposal to the council to turn it into a full residential property.' Father: 'Yes that would be great Khris, keep it in the family. Then me and your mother will be comfortable when we come and stay as we will have more room.'"
12. Khristine had a very close relationship with her father. They spoke often and spent time together. She was quite active in caring for him when he was unwell. She was ever-present during his final illness and up to his death.
13. Khristine also assisted Bruce in looking after the Balmain properties, such as by dealing with letting agents and the council, arranging minor repairs and other matters. She was also actively involved in assisting her parents in their dealings with the builder with whom they contracted for the Razorback property. Much of this was done while she was still in Qatar.
14. As mentioned, she took her mother in to live soon after her father died and has remained living with her ever since. This has not been convenient. The Little Darling Street property is very small. She has two young children, one with high needs, and is pregnant with a third. She and her husband work from home for several days each week. Khristine and her husband pay for groceries and other expenses for Anecia. They have also paid for her to take several family holidays with them.
15. Of all the beneficiaries, Khristine has been the most active in looking after the interests of her father's estate. She paid his funeral costs, for which she has not been reimbursed. She has spent a significant amount of time traveling to and from the Razorback property, which is about 2.5 hours from her home, at her own expense to tidy it up and prepare it for sale.
16. Khristine has also incurred significant legal expenses in connection with these proceedings. She estimates that she has spent almost $80,000 including for counsel's fees and other disbursements.
17. Khristine has also been quite active in looking after the interests of her brother, Tyrone. She has supported him in his bail application including by offering a surety and also agreeing that, if released, he will be required to live with her at Little Darling Street and report to the Balmain police station, which is just 100 metres from that property.

David

1. David, who is 62, has lived with his elderly mother at Birrong since about 2011 or 2012. His mother, Pauline, is now 89 years old. He cares for her but otherwise has no dependents.
2. David received a very good education but has had few remunerative positions as an adult. He has had acting jobs and production roles in the past and has pursued various ventures in the dramatic arts. He is the sole director, secretary and shareholder of Presence Global Entertainment Pty Ltd (Presence Global), a television program production company with no meaningful assets. He described the company as having development projects but said that they are unlikely to be realised in the near future. He has lent the company about $77,000 which will probably not be repaid any time soon. It was not at all clear to me when, or how, Presence Global ever expects to turn a profit.
3. For some time, David worked as a part-time lifeguard for the City of Parramatta Council but says that he resigned from that position in September 2023 to care for his mother. In the year of income ending 30 June 2023 he earned about $25,000.
4. David has no financial commitments. In an affidavit sworn shortly before the hearing he claimed to have monthly expenses of $5,379. He claimed that his monthly expenditure included a payment of $1,933 which he described as "funds loaned" to Presence Global.
5. I cannot accept that he incurs "expenditure" in that amount to his company as he claims or that he expects to do so in the future. As his own evidence demonstrates, he simply does not have enough money to do so. He may have lent funds to the company in the past, but he is not doing so now. His income is nil and his bank accounts demonstrate that, to the extent he has funds at all, it is in the form of cash deposits from his mother.
6. For example, in January 2024 his mother gave him $18,000. She gave him at least a further $3,600 in May.
7. David has no assets of any significance. He says that if his mother needs to sell her home in order to move into care, his situation will be dire. However, the evidence does not allow me to reach a conclusion about whether this is likely to occur and the extent to which David's interests might be affected if it does occur. No doubt, if she needs to sell her home, David will need to find somewhere else to live. But what the arrangements between him and his mother might be in those circumstances was not the subject of evidence.
8. David has been derelict in looking after his own financial interests. Even though he has been on a very low income (at most) for some time, it took him about 12 months to work out how to link his MyGov account to Centrelink in order even to make an application for a carer's allowance. By the time of the hearing he had finally solved that problem and made an application, but the process has again stalled while he works out how to obtain a birth certificate for his mother. He has not been diligent about getting the allowance but was indignant when this was suggested to him in the witness box.
9. In the absence of a job or social security benefits, he has instead used up what little remained of his savings and received cash from his mother, as already mentioned.
10. In his affidavits, David painted a picture of being very close to his father. He gave evidence of many conversations, the gist of which was generally that Anecia and their children were a disappointment to his father but that he could trust and confide in David. He suggested that he was something of a financial adviser to his father. He says that "money was an issue for [Bruce], Anecia and some of the family members", the clear implication being that it was not an issue for himself.
11. This picture is one that I have difficulty accepting at face value. The likelihood is that David and his father did speak about money in the sense that David did want his father to give him money, as both Gina and Khristine said. It stands to reason that David, who wanted money to pursue television and film production projects but had extremely limited financial means to do so, would talk to his father about this and would in fact ask him for money. That is after all what Bruce told both Anecia and Khristine. I note that David did not actually deny asking for money. What he denies is asking for money "instead of" his inheritance.
12. I am also unable to accept that David remained on good terms with his father and half-sisters as he claims, despite the disagreement to which I will refer in due course. He did not attend his sister's wedding in 2017 and denies that this was because he was not at that point on speaking terms with his father, yet at the same time does not explain why he did not attend. Matters such as this, when coupled with his general immaturity in his dealings with Anecia, lead me to conclude that I should not accept his account of his relationship with his father uncritically. Anecia described the relationship between David and his father as "unstable". I agree with that description.
13. Taking all of these matters into account, I find that David did not have nearly as close or constant a relationship with his father as either Gina or Khristine.

Tyrone

1. Tyrone has not raised his financial circumstances in any formal way, however it is relevant to note his general position.
2. Tyrone was incarcerated between 2013 and 2020 in connection with drug offences. The evidence as to his offending was limited but nothing really turns on it and so there is no need to set it out. On his release he lived with his parents at the Razorback property but in 2022 he was again arrested and charged with further offences. He remains in custody pending trial on those new charges.
3. I have already mentioned his daughter, Tigerlily, who lives with Gina and her family. It is unlikely that Tigerlily's parenting arrangements would change if Tyrone were to be released from custody in the near future.
4. Tyrone is currently receiving legal aid. He does not own a car but owns tools and other chattels that were located at the Razorback property with a total value of about $8,000. He has no cash savings but has superannuation of about $10,000.

Assets

1. The midpoints of the valuations of the properties put forward by the defendant are as follows: 1. Montague Street: $2,510,000 2. Llewellyn Street: $2,525,000 3. Little Darling Street: $1,787,500 4. Razorback: $2,550,000
2. If all of the properties are sold, it will be necessary to pay capital gains tax totalling $1,329,689.68 in addition to selling costs. The evidence as to the amount of capital gains tax payable on each property was that the amount could vary slightly depending on which property is the first to be sold. The amounts for each property will be: 1. Montague Street: $386,296.30 - $417,246.30 2. Llewellyn Street: $441,454.63 - $472,404.63 3. Little Darling Street: $300,755.15 - $331,705.15 4. Razorback: $108,333.60 - $139,283.60
3. The commercial premises at the Montague Street property are currently leased at a rental of $4,214.88 per month (including GST). The residential premises at that property are currently leased at a rental of $3,476.19 per month. The Llewellyn Street property is leased at a rental of $4,910.12 per month.
4. The rental for the Montague Street properties (the downstairs commercial premises and the upstairs dwelling) and the Llewellyn Street property is ordinarily paid to the managing agent, who uses those funds to meet ongoing expenses. Between December 2023 and March 2024, the defendant received $151,441.48 from the managing agent's trust account, leaving trust account balances in relation to the properties as follows: 1. 4 Montague Street: $41,499.53 2. 4a Montague Street: $7,192.26 3. 27 Llewellyn Street: $32,331.78
5. The total rental return, after expenses, earned by the estate consists of the sum of $151,441.48 as well as the trust account balances just mentioned. It follows that the estate earned a total of about $232,465 (after paying expenses relating to those rental properties) up to 30 June 2024.
6. Bruce had a small parcel of shares, which the defendant has realised for the sum of $8,773. Bruce also had $238,609.07 in a bank account.

Liabilities

1. As mentioned, probate of the Will was initially granted to David and Mr Penhall, but that grant was revoked by orders made on 31 March 2023. The estate has paid $117,165.96 for the executors' costs of the proceedings that led up to the revocation pursuant to orders made on that day.
2. The estate was assessed to pay land tax in respect of the Balmain properties for the years ending 31 December 2022 and 2023 in the total sum of $95,006.85. This amount has been apportioned by the defendant to the properties as follows: 1. Montague Street: $29,434.10 2. Llewellyn Street: $39,093.10 3. Little Darling Street: $26,728.84
3. These amounts have been paid.
4. The defendant estimates land tax for 2024 as follows: 1. Montague Street: $16,070.33 2. Llewellyn Street: $21,013.85 3. Little Darling Street: $14,357.32
5. Bruce had an income tax liability for the 2022 year of income in the sum of $18,176.80. I note that the estate failed to claim land tax as a deduction against the assessable income derived for the 2023 year of income, notwithstanding that the liability was incurred in that year. I was informed that the administrator proposes to take steps to address this issue. Assuming that is done, the likely result is that the estate will be entitled to a refund of the tax paid for the 2023 year.
6. The estate has also borne administration expenses associated with maintenance and sale of the Razorback property. That property has been listed for sale.
7. The funds paid into the estate account from the managing agent of the Balmain rental properties have been used by the defendant to meet general administration expenses and costs. The defendant has recognised that the use of funds in this way as giving rise to a liability to (or in respect of) the entitlements of the specific legatees of those properties. So, for example, if David were to receive the Montague Street property under the Will as it stands, he would also be entitled to the rental income (less rental costs and expenses) earned by that asset in the meantime.
8. However that may be, it is relevant also to note that the "liability" of the estate to account for rental income may or may not arise depending on whether, as a result of this litigation, any specific legatee actually does become entitled to either of those properties and, further, whether any specific legatee's entitlement to such property or the funds representing the accumulated earnings on such property is otherwise affected by the orders made in these proceedings.
9. The same is true of other expenses including income tax, which have generally been recorded as giving rise to a debit against particular properties. This means that, prima facie, the entitlements of David and Gina as specific legatees of the two rental properties have been charged with the burden of the estate's income tax and other liabilities. Again, this is as may be, but whether it will be appropriate for the burden of income tax actually to be borne in that way may be affected by the outcome of these proceedings.
10. The overall position of the estate, leaving aside the costs of these proceedings, is that there should now be assets and accumulated income totalling about $9,700,000, but that the estate has incurred liabilities and charges totalling about $462,000 which is about $114,500 more than the estate's available cash. When the various charges and liabilities are allocated against individual properties (or, rather, against the entitlements of specific legatees of those properties) the position is as follows: Montague Street Llewellyn Street Little Darling Street Razorback Residue Total Value (AUD) 2,558,691.79 2,557,331.78 1,787,500 2,550,000 247,382.07 9,700,905.64 Liabilities/ 2,976.04 (10,491.40) (50,249.68) (70,157.54) (334,713.11) (462,635.69) income (AUD) Total (AUD) 2,561,667.83 2,546,840.38 1,737,250.32 2,479,842.46 (87,331.04) 9,238,269.95

1. These amounts broadly represent what each of the beneficiaries would receive if the estate were distributed according to its terms, if the properties have the values ascribed to them in the accounts.
2. The estate will also have to bear a significant portion of the costs of this litigation. The result is that the estate cannot be administered without one or more of the properties being sold or without additional funds being contributed by one or more of the beneficiaries. The parties accept that if additional provision is made for the plaintiff, there is a high likelihood that all properties will have to be sold. It is also appropriate to note that the residual beneficiary under the Will was Anecia. The expenses that the estate has incurred, including the funeral expenses and the costs of two sets of proceedings (the first involving the question of whether David and Mr Penhall should be executors, the second being these proceedings), mean that the residuary estate has been chipped down to nothing.

Applicable principles

1. There was no dispute about the principles to be applied in determining Anecia's claim for provision. I have had particular regard to the summary of principles collected and explained by Meek J in Tarbes v Taleb [2023] NSWSC 565 at [195]-[222].
2. In Re Clissold (deceased) (1970) 2 NSWR 619 at 621, Street J explained that the bond of matrimony gives rise to a testamentary obligation: see also Kalmar v Kalmar [2006] NSWSC 437 at [48]-[50].
3. The interested beneficiaries accepted that Bruce had such an obligation and that he failed to make sufficient provision for Anecia. All interested beneficiaries accept that it would be appropriate for me to make an order for additional provision that, broadly, will be sufficient to provide Anecia with her own home, a reasonable income and a fund for contingencies.
4. Section 65(1)(c) of the Succession Act requires that any order for provision must specify "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".
5. In Pargeter v Pargeter [2024] NSWSC 675, I referred to the principles governing the manner in which the burden of provision must be determined. I said at [20]: "The section confers a wide discretion. In Cantrell v Williams; Estate of Thomas Brindle [2004] NSWSC 579, Young CJ in Eq said of s 13 of the Family Provision Act 1982 that the discretion was 'to be exercised according to the rules of reason and justice, with due regard to the whole of the surrounding circumstances'; see also Hoobin v Hoobin [2004] NSWSC 705 per White J. In the latter case, White J had particular regard to 'the proper claims on the deceased's bounty' of the competing claimants, including their financial circumstances. I note however that his Honour did not confine his consideration to their financial circumstances."
6. I approach the question of apportioning the burden of any provision here in the same way. I also note that, as Kunc J pointed out in Webster v Strang [No 2] [2018] NSWSC 1411 at [105], the question of where the burden of provision should lie involves an evaluative judgment.
7. I also note the judgment of Macfarlan JA (with White and McCallum JJA agreeing) in Strang v Steiner [2019] NSWCA 143 at [107] which discusses the sources of power in the Succession Act that allow me to apportion the rates at which the beneficiaries will bear the burden of any further provision. Finally, I have paid particular attention to the language within ss 66(2) and 72(2) of the Succession Act which require the Court to allocate the burden in a way which it thinks is just and equitable.

Anecia's claim for provision

1. Because of the evidence of the plaintiff and her daughters that they did not wish to see the Balmain properties sold and because it was the clear scheme of the Will that those properties should not be sold, I told the parties that I would first reach conclusions as to (a) the amount of provision that is appropriate for Anecia and (b) how the burden of that additional provision should be borne. My specific intention in approaching the matter in this way was to give the parties an opportunity to lead further evidence and make submissions as to the form in which the additional provision for Anecia should be provided, having regard to my conclusions on these issues.
2. In particular, because the only way the estate can be administered without the Balmain properties being sold is if some or all of the beneficiaries are willing to put the estate in funds to make further provision for Anecia and to help meet administration costs, it is appropriate in the somewhat unusual circumstances of this case to allow the parties to lead further evidence and make further submissions as to the final form of orders in the light of my conclusions as to the amount of provision to be ordered and the extent to which each of them is required to bear the burden of that additional provision.

What is sufficient provision for Anecia?

1. As I indicated at the outset, it is broadly accepted by the defendant (and all beneficiaries) that Bruce made insufficient provision for Anecia. She was his loyal and loving partner during 40 years of marriage. Together, they raised three children. The plaintiff was Bruce's primary carer for several years prior to his death during a period in which Bruce was often ill.
2. The plaintiff is now 76 years of age and, although she suffers from some ailments, is generally fit and active. She is fully capable of living independently and it is her strong and stated desire to continue to do so. There is every reason to think that she will enjoy all 14 of the years which, according to actuarial tables, represent her current life expectancy.
3. The estate is relatively large. It is comfortably large enough to ensure the wellbeing of all beneficiaries within reasonable bounds.
4. The first consideration is Anecia's need for her own accommodation. Although there was some suggestion by the defendant that her needs could be met by some form of retirement living arrangement, I find that it is appropriate having regard to Anecia's general circumstances for her to have sufficient provision to allow her to live independently in the community, which is her wish.
5. Anecia's stated desire was that she should be able to continue to live in the Little Darling Street property, which is where she is currently living albeit with Khristine and her growing family.
6. I am disinclined to treat the value of Little Darling Street as a baseline or proxy for the amount of provision required to meet Anecia's housing needs. For a start, it is a freestanding home and will inevitably require more by way of rates, maintenance and insurance over time than would an apartment. I accept that she requires a two-bedroom home to accommodate family who may wish or need to stay with her from time to time, but that is a need that is just as easily met with a two-bedroom apartment.
7. The plaintiff's evidence was that an appropriate two-bedroom unit would cost about $1,500,000. I will proceed on the basis that any provision must be sufficient to provide her with accommodation of that value in addition to her other needs.
8. There was no serious dispute as to Anecia's expected estimated monthly expenditure. She submitted that the 3% discount tables show that an appropriate fund to produce income to cover her needs would be about $850,000.
9. As to a fund for contingencies, the plaintiff submitted that a fund of about $400,000 would be appropriate. There was no particular science behind this number, which is understandable. I accept that the plaintiff should have received sufficient provision from the Will to allow her to meet contingencies, at least to some extent.
10. The plaintiff's position is therefore that she requires a sum of about $1,250,000 to produce income and to meet contingencies. The plaintiff also submitted that allowance should be made for her to purchase a car for the sum of $35,000. The defendant's position was that a total sum of $1,000,000 was sufficient to meet all of these financial needs, including a fund for contingencies.
11. I am reluctant to approach the calculation of sufficient provision to meet the plaintiff's financial needs in quite the manner submitted by the plaintiff. I do of course accept that the analysis which has been provided as to her monthly financial expenditure and the size of the fund required to meet that expenditure has been helpful in understanding the overall position. But my determination of an appropriate amount of provision is not an exercise in calculating compensation. The task requires me to have regard to a range of other matters, including the size of the estate and the position of the other beneficiaries.
12. One of the matters I may take into account in reaching a conclusion as to an appropriate amount of provision is Bruce's intention as to how his estate should be divided. In that respect, the Balmain properties were of particular historical and sentimental value to Bruce and, it seems, his children, and this is a matter which clearly informed his wishes as to how his estate was to be divided, namely in the form of specific gifts of those properties.
13. The other beneficiaries all share that sense of sentimental and historical connection to the properties, at least to some degree. Each of Anecia, Gina and Khristine expressed a desire that the Balmain properties (or, at least, not all of them) not be sold. Given that Anecia expressed a wish to be able to receive Little Darling Street as a specific devise as part of the orders she seeks in these proceedings, I take it to be accepted that I should consider the ability of the estate as a whole to accommodate that outcome or something like it in determining an appropriate amount of provision for her.
14. It is this last-mentioned consideration which, I gather, has been the most significant bone of contention among family members in this litigation. All agree that Anecia needs more provision, but clearly neither she nor her daughters want the Balmain properties to be sold in order for that outcome to be achieved.
15. In cross-examination, for example, Gina said that she was willing to borrow up to $500,000 to pay to the estate in order to facilitate an outcome in which the Balmain properties did not need to be sold.
16. For his part, David expressed indignation that he might inherit anything less than the full value of the Montague Street property which was specifically devised to him. At the same time, he accepted that insufficient provision had been made for Anecia and that it was fair and reasonable that she should have sufficient additional provision to allow her to live comfortably and independently.
17. Taking all of these matters into account, I find that appropriate provision for Anecia should include (in addition to the sum required for housing) property or cash totalling $1,250,000 to provide an income stream and to help her face contingencies in the future.
18. It follows that an appropriate amount of provision for Anecia is $2,750,000. This is more than has been provided for her under the Will and so it will be appropriate to make a Family Provision Order to give effect to this conclusion.

How should the burden of additional provision be borne?

1. The gifts in the Will represent the following rough percentages of the value of the distributable estate: 1. Gina: 27% 2. Khristine: 19% 3. David: 27% 4. Tyrone: 9% 5. Anecia: 18%
2. These figures account for the fact that the residuary estate has been depleted to nil. Thus, Anecia's percentage has decreased, albeit by only a small amount.
3. Tyrone's legacy is already very low compared to the size of the estate. When his father made the Will in 2011, he clearly considered that Tyrone, of all the children, had the least claim on his testamentary bounty. But I do not see that to be a reason for him now to bear the burden of additional provision for his mother. When he is released, he will need every cent of his already much reduced inheritance. He may need those funds for his defence in the meantime in any event. In the circumstances, I do not propose to reduce his entitlement under the Will to accommodate a Family Provision Order in favour of the plaintiff.
4. The real contest here is as among David, Gina and Khristine. Of these, Gina and Khristine demonstrated financial needs that I consider to be quite pressing. Their needs are, relatively speaking, much more immediate than David's. David has been living rent-free with his mother for many years now. He is 62 years of age and has devoted himself to the pursuit of success in the film industry which has thus far eluded him. He currently has no apparent regular source of income but, as he said in cross-examination, film is his chosen industry and that is how he has chosen to conduct himself. He believes in the "potential" of his projects but the evidence does not allow me to form a view as to whether his belief is justified.
5. He has in recent years devoted himself to caring for his sick and elderly mother but, at the same time, has not taken meaningful steps to secure a carer's pension for which he appears to be eligible. He claims even to have stopped working part-time as a lifeguard at a local swimming pool in order to care for his mother. If that is so, it is difficult to see how the potential of any of his film projects is likely to be realised in the near term. However, in the absence of a full explanation of his financial circumstances (a matter I address below), those of his mother on whom he is dependent, and of his mother's actual care requirements, I am disinclined to accept that part-time work as a lifeguard at the council pool is entirely incompatible with his role as his mother's carer.
6. David's financial situation is opaque in some respects. I have already referred to the evidence he gave as to his ongoing expenditure which, as I have pointed out, is impossible to accept on the evidence before me. He has obtained quite significant sums from his mother, apparently as gifts, but has otherwise not led evidence as to her circumstances generally or what he expects to receive from her estate when she dies. He said that if his mother moves into assisted living and needs to sell her house then his situation will be dire. It is difficult to accept this submission on face value given the lack of evidence around his mother's finances and the fact that he receives significant funds from her. A reasonable inference is that he expects to benefit from her estate. I note his mother has no other children or grandchildren and that in addition to caring for her, David is at the same time very financially dependent on her.
7. So far as other circumstances are concerned, David did not have anywhere near as close or constant a relationship with his father as either Gina or Khristine. He went years at a time without speaking with him. He avoided speaking with him on family occasions at which they were both present. He was petulant in his dealings with him for long periods at a stretch.
8. One particular incident warrants attention. He says that in 2013 he had a discussion with his father about creating a video so that, if there were a dispute about his will, there would be video evidence. According to David, this was in the context of Anecia expressing a view to see his will (which seems to have riled David but which would have been a perfectly reasonable thing for Anecia to say). David says that in response to this, he made arrangements to spend about $150 to cover the cost of a videographer but that at the last minute his father declined to participate on the advice of his solicitor. David called his father to say: "Don't call me to fix your problems. I am done with it. You don't listen to me anyway."
9. David claims that, after this episode, his father continued to visit him every month or so but that they "no longer spoke on the telephone and did not speak as much about his personal or business issues".
10. I accept that this incident occurred. However, I cannot accept David's evidence that it did not really have an impact on his relationship with his father. I accept Anecia's evidence that David did not speak to Bruce for about seven years after this episode. I have generally found her to be a credible and reliable witness, whereas I have not found David's evidence to be reliable in all respects, such as in relation to his financial situation. Anecia places the episode in about 2011 and says that Bruce and David started to speak again only after Bruce had a heart attack in about September 2017. I do not accept David's claim that his father visited him every month or so after this episode, irrespective of whether it took place in 2011 or 2013.
11. I also note that when they did see one another, Bruce generally travelled to see David, not the other way around. That is because David was not willing to see or spend time with Anecia if he could avoid it. David never developed any kind of mature relationship with Anecia despite the fact that she was married to his father for 40 years. As Anecia said, for the whole of the time of her marriage to David's father, David was invited to family occasions but he generally neither accepted the invitations nor attended.
12. It is also relevant to note that, whatever the rights and wrongs of their dispute, David's refusal to speak with Bruce after this episode demonstrates a degree of petulance towards his elderly father that has some bearing on my consideration on what might be a just and equitable distribution. Theirs was not a close and loving relationship such as the ones that Bruce enjoyed with other members of his family. I say this mindful of the fact that there is endless variety in the way parents and children interact and that it can often be very difficult to gauge the strength of a relationship by external indications of affection alone.
13. I have already referred to Anecia's evidence that in about August 2021, Bruce was seriously considering selling the Little Darling Street property in order to fund the construction of the new home on the Razorback property and giving $1,000,000 to David in full satisfaction of any claim he may have to his estate: see above at [24]-[27]. Anecia said that Bruce and David spoke about this issue on several occasions between about June and August 2021. According to Anecia who was present when these calls took place but who was not a participant in them, David wanted Bruce to sell the Montague Street property and to give some of the proceeds to him. David rather dramatically denied that he ever "initiated" a discussion with his father about that.
14. David also emphatically denied that he was party to any agreement to receive $1,000,000 in lieu of an inheritance. I am unable to determine whether or not such an agreement was actually reached, but I am satisfied on the basis of Anecia's evidence that, so far as Bruce was concerned, he believed that such an agreement had been reached. However that may be, Bruce's plan did not come into being, including because of illness and the COVID-19 pandemic. But the evidence surrounding this issue causes me to conclude that, when Bruce turned his mind to his testamentary intentions in more recent years, he contemplated a one-off payment of $1,000,000 to David in complete satisfaction of any claim he would otherwise have on his estate. Bruce seems to have had a view about the relative strength of David's claim on his testamentary bounty that broadly aligns with my own assessment of that claim.
15. It is true that David's financial position is very poor. He has no significant assets or savings. But he has not fallen on hard times. He is a well-educated, articulate, creative individual who has devoted himself to a lifestyle that has proved incapable of paying for itself. He also seems to be able to draw funds from his mother. His financial position is poor, but at the same time his needs are not pressing, at least relatively speaking, compared to his sisters who both have needful young families.
16. I therefore conclude that it is just and equitable that David should bear significantly more of the burden of the additional provision for Anecia than either Khristine or Gina.
17. As between Gina and Khristine, the position is somewhat more nuanced. They are both resourceful and self-reliant individuals. They have each purchased property in Sydney at a time when that involves very significant financial commitment. They both work hard to service mortgages and to help support their families. They are both conscientious and devoted parents. Neither is profligate.
18. Gina has the additional burden of caring for two very high needs children, Jacqueline and Tigerlily, in addition to her son, Cameron. She and her husband have devoted themselves not only for the care their own immediate family but for their niece. That is a matter to which I attach particular weight in determining the extent to which they should share in the burden of providing for Anecia.
19. Khristine is about to give birth to a third child. She will take maternity leave, most of which will not be paid. She has also taken on the burden of housing her mother for the past several years and has done so in a small two-bedroom house from which both she and her husband are often required to work remotely. She has made the most contribution to the administration of the estate by attending to the Razorback property and by meeting expenses. At the same time, I do note that she has been living rent-free at the Little Darling Street property during most of that time.
20. An important matter to note in this respect is that, under the Will, Gina stands to inherit a significantly more valuable property than Khristine. The appraisals in evidence suggest that Gina's share of the estate, by value, comes to about 27% compared to 19% for Khristine. This places her in a far better position, even with the relatively significant financial needs I have identified, to absorb the additional burden of providing for Anecia.
21. The defendant submitted that I should throw the burden of additional provision against each beneficiary rateably according to the value of what they would inherit under the Will. Whilst that may sometimes be appropriate, it is not appropriate here. David, Gina and Khristine have all put their financial circumstances in issue and I am able to reach an informed conclusion as to their relative ability to bear the burden of additional provision in a way that is just and equitable. If they were to bear the burden rateably according to the value of their specific legacy, David and Gina would bear the burden about equally, which I do not consider to be at all appropriate.
22. In the circumstances, I find that most of the burden of the additional provision for Anecia should be borne by David and that, of the balance, it should mostly be borne by Gina.
23. If Razorback is sold and the estate is otherwise administered according to the Will (leaving aside the question of how administration expenses and the costs of these proceedings are paid for), then tax would be paid on the sale and the plaintiff's final distribution would likely be about $1,500,000. There is necessarily uncertainty about this amount because Razorback has not sold. Nonetheless, on the basis of the material before me, I would conclude that Anecia requires additional provision of $1,250,000.
24. Of this amount, I find that it is appropriate for David to bear the burden as to $950,000, for Gina to bear the burden as to $250,000, and for Khristine to bear the burden as to $50,000. This represents a sharing of the burden in a ratio of 76% to David, 20% to Gina, and 4% to Khristine. This is the outcome which I find to be the most just and equitable in the circumstances.

How should additional provision be provided?

1. In argument, I raised with the parties the possibility of making ancillary or consequential orders adjusting the entitlements under the Will such that Anecia would receive the Little Darling Street property as a specific devise plus additional provision in cash, Khristine would receive the Montague Street property as a specific devise but subject to making an adjustment in favour of the estate to ensure that she was not receiving any more in value than what was left to her initially, and for David instead to receive the two-thirds interest in the Razorback property. It would in that event also be necessary to make orders requiring the beneficiaries to make cash contributions to the estate to allow the additional provision to be paid to Anecia.
2. This course has attractions, although the evidence as this stage does not allow me to conclude that it is appropriate. Such an approach would allow Anecia to receive the Little Darling Street property (which is what she wants), for Khristine to receive the Montague Street property (which is what she wants) and for Gina to receive the Llewellyn Street property (which is what she wants).
3. David would not get what he wants. But I cannot see any solution to the present impasse that involves David getting the Montague Street property or a sum of money equal to its value.
4. The defendant objected to this course, principally on the basis that it was beyond the powers given to me by the Succession Act to adjust the beneficiaries' entitlements such that Khristine would instead inherit a property of greater value than that bequeathed to her under the Will, even if such an order were to be made subject to a requirement that she contribute to the estate in an amount equal to the difference in value between the Little Darling Street property and the Montague Street property.
5. It was also submitted that David, as the "firstborn son", had some measure of entitlement to the Montague Street property, but how this could be in the face of the acknowledged need to provide significant provision to Anecia and David's inability otherwise to contribute to that provision was not explained.
6. The course suggested by me in argument is not the only means by which provision might be made for Anecia in a way that avoids the sale of the Balmain properties. An alternative approach is for the entitlements of Anecia and David to be swapped, such that Anecia receives the Montague Street property and David receives a two-thirds interest in the Razorback property.
7. There are several benefits to this approach. The first is that it is the one that does the least violence to the overall scheme of the Will. It is important to keep in mind that the overall scheme of the Will was for the Balmain properties to be devised without being sold. However, for reasons already explained the outcome contemplated by the Will simply cannot be achieved in the light of the conclusions I have reached as to the need for further provision and the need to meet estate expenses.
8. There is no outcome here that involves the specific scheme of the Will being respected. However, an outcome in which Gina and Khristine receive the properties given to them in the Will and Anecia receives Montague Street is very close. So far as David is concerned, as I have already noted I cannot see an outcome in which he receives anything other than cash from the sale of a property. He will be required to contribute to the additional provision and otherwise has no ability to contribute cash, either for that provision or for estate expenses.
9. Next, a solution in which none of the Balmain properties are sold is one which saves the estate a very considerable amount of income tax. This is to the benefit of all beneficiaries, including David. It means that all parties are required to contribute less to the expenses of the estate. Gina, Khristine and Anecia would instead inherit properties on which they would be required to pay capital gains tax if and when they decide to sell.
10. Further, although it is not her stated desire to live in Montague Street, it is a property that would ensure a steady income to the plaintiff for the rest of her life. She would have less relatively available cash to meet contingencies, but she would be free to sell the property at any point to fund a move to other accommodation.
11. I will not express any concluded view on any of these questions pending the receipt of further submissions as to what form the Family Provision Order in this case should take in the light of the conclusions I have expressed.

Orders

1. I will therefore not make final orders at this stage. I will instead make directions for the parties to file and serve submissions as to the orders appropriate to give effect to my conclusions, together with any additional evidence as to any beneficiary's capacity and willingness to contribute to the estate in order for any Family Provision Order to include an order that Anecia takes either the Little Darling Street property or the Montague Street property as a specific devise under the Will, and as to any ancillary or consequential orders. I will also request the parties to file submissions in relation to costs.
2. The orders will be as follows: 1. The parties are to file and serve any further evidence as to the form of orders appropriate to give effect to the Court's conclusions, together with any submissions as to that matter and as to the costs of the proceedings, on or before 4:00PM on 13 September 2024. 2. The parties are to file and serve any evidence and submissions in reply on or before 4:00PM on 27 September 2024. 3. The proceedings will be listed for mention at 9:30AM on Wednesday 2 October 2024 for the purpose of determining whether any additional hearing day is required.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 23 August 2024