Plaintiff v Defendant

2 The deceased was the only child of her parents, who both predeceased her. She married Wallace Albert Wathen ('Mr Wathen') and they had one child, a son, born on 23 May 1965. In 1975, Mr Wathen and the deceased separated and they subsequently divorced. The deceased's son benefits under her will in the form of weekly payments for the rest of his life and is the defendant in this proceeding.

3 At the time of the deceased's death, the whereabouts of the defendant was unknown, with Mr Wathen telling the plaintiff that his son's last contact with him was in 1995.

4 Investigations were made to locate the defendant, without success. On the basis that the defendant could not be found, on 9 June 2015, the plaintiff sought an order authorising distribution of the deceased's estate on the basis that the defendant did not survive the deceased and died without issue.[1] The Court required the plaintiff to make further enquiries and searches in an attempt to locate the defendant. At the same time, orders were made to set aside a sum to cover the estate's anticipated costs, executor's commission and other liabilities and for one part of the remainder of the estate to be distributed with the remaining part to be held in trust pending the determination of the proper construction of the will.

5 The further enquiries and searches resulted in a person from the Salvation Army contacting Mr Wathen. That person told him he had a person with him who claimed to be the defendant. That person then spoke to Mr Wathen, identifying himself as the defendant. He told Mr Wathen that he had become an alcoholic and a drug addict, had changed his name several times so that no one could find him and that the Salvation Army was helping him to recover from his addictions. Arrangements were made for the person to undergo DNA tests and the tests established that he was the defendant.

6 During the process of organising DNA testing and prior to the defendant engaging his own solicitors, the defendant raised with the plaintiff's solicitors whether a house could be purchased for him instead of him receiving the weekly payments, as he was concerned that he may revert to using drugs.

The defendant is added as a party to the proceeding

7 As a consequence of the positive identification of the defendant, he was added as a party to the proceeding. At that time, he informed the Court that he wished to vary the provision made for him under the deceased's will and that he may seek orders for further provision from the estate, pursuant to the Part IV provisions of the Administration and Probate Act 1958. Subsequently, the defendant's solicitors informed the plaintiff's solicitors that the defendant's proposed Part IV claim would be limited to a claim for the whole of the remaining part of the estate that was held in trust pending the determination of the construction of the will.

8 In respect of the defendant's foreshadowed Part IV claim, the solicitors for Mr Wathen informed the plaintiff's solicitors of Mr Wathen's concern that:

... under the criteria of character and conduct the relationship with the deceased was universally severed by the defendant and the history of the [defendant] suggests that his conduct leads to a persuasive argument that whatever moneys might be provided would be at risk of being dissipated by him.

9 Since the defendant was added as a party to the proceeding, his solicitors have also advised the plaintiff's solicitors that the defendant does not wish to receive his entitlement of the weekly payments under the will pending finalisation of the construction questions concerning the deceased's will.

10 The plaintiff's solicitors have requested details from the defendant's solicitors as to what proposals the defendant has, if any, relating to provision for him, such as the purchase of suitable housing for him, in addition to his entitlement to weekly payments from the estate. No further details had been provided as at the date of the trial.

11 After payment of costs to date and taxation liabilities up until 30 June 2015, the amount currently held in trust by the plaintiff's solicitors for the provision of ongoing costs, taxation liabilities and executor's commission is $252,346.

12 The amount representing three quarters of the residue of the estate is $2,594,804.38. As at 5 May 2016, the amount is $2,627,272.20.[2]

13 By clause 3 of her will, the deceased provided for the defendant, Mr Wathen and four friends as follows:

3. I GIVE DEVISE AND BEQUEATH the whole of my real property and personal estate wheresoever and whatsoever (hereinafter called 'my estate') to my trustees upon trust to sell call in or convert the same into money at such time or times and in such manner as my trustees shall in their absolute discretion think fit with power to postpone the sale calling in or conversion of the whole or any part or parts thereof during such periods as they shall think proper and to retain the same or any part or parts thereof in the form of investment which same shall be at the date of my death notwithstanding that the same may be of a hazardous or wasting nature without in such case being responsible for loss and to hold the net proceeds of such sale calling in or conversion and my ready money upon trust to pay thereout all my just debts funeral or testamentary expenses State Probate Duty Federal Estate Duty and all other expenses caused as a result of my death or in consequence of my estate and to hold the balance then remaining upon the following trusts, that is to say:

(i) As to three quarters (¾) of my Estate to establish a trust and to pay thereout the sum of $1,000.00 per week plus a CPI increase each year on the anniversary of my death to my son GLEN WILLIAM WATHEN provided he survive me and weekly until his death and thereafter to pay the sum remaining of both capital and income to such of his child or children as shall survive him and obtain the age of twenty one years and if more than one as tenants in common in equal shares.

(ii) As to the sum remaining as follows namely:

• (a) One half to the said CATHERINE ANNE WALL provided she survive me;
• (b) As to the remainder to my former husband WALLACE ALBERT WATHEN, my friend JUNE PAWSON, my friend GLENISE DILLON and my friend MARY MILLER provided each survive me and if more than one as tenants in common in equal shares.

14 Clause 3(i) provides for a trust comprising of three quarters of the residue of the estate to pay the defendant the sum of $1,000 per week plus a CPI increase each year on the anniversary of the deceased's death until his death ('the weekly amount'). Thereafter the remaining capital and income is to be paid to such of the defendant's child or children as shall survive him and attain the age of 21 years and, if more than one, as tenants in common in equal shares.

15 The gifts to the named beneficiaries in clause 3(ii)(b) are conditional in that they must survive the deceased. Glenise Dillon and Mary Miller predeceased the deceased. The plaintiff, Mr Wathen and June Pawson survived the deceased. Mr Wathen and June Pawson have been notified of the proceeding and provided with all relevant documents.

16 By cl 4 of her will, the deceased provided the plaintiff, as her trustee, with the following specific discretionary powers:

4. I DECLARE in the execution of the powers and duties conferred on my trustees by this my Will or any Codicil thereto and the administration of my estate and in the application thereto of the powers conferred on trustees by statute my trustees may in their absolute discretion exercise any of the following powers and discretions:

(a) ...

(b) In their absolute discretion notwithstanding the provisions herein before made to apply the whole or any part of the income or the capital of the share whether expectant contingent or vested of any beneficiary taking under the trusts of this my Will in or towards the maintenance education or advancement or otherwise for the benefit of such beneficiary and for that purpose to pay such income or capital to the guardian or guardians for the time being of such beneficiary or the beneficiary without being bound to see to the application thereof AND I DIRECT for the purpose of this clause accumulations of income of the past years shall be available as if they were income of the current year.

17 The plaintiff seeks the determination of the following questions:

(a) Whether, on the death of the defendant and assuming he has no children then living, the share that is left by clause 3(i) of the will of the deceased dated 24 November 2004 that has not been already distributed to the defendant by the time of his death [by] way of weekly payments or otherwise goes to:

(ii) June Pawson and Mr Wathen or their respective estates if they do not survive the defendant pursuant to clause 3(ii) of the will and s 46(3) of the Wills Act 1997; or

(iii) the Crown by s 55 of the Administration and Probate Act 1958.

(b) Whether the defendant has any current entitlement to the balance remaining undisposed of the three-quarters share left to him by clause 3(i) of the will pursuant to an interest as next of kin on a partial intestacy as to such balance.

(c) Whether the trustee may in her absolute discretion pursuant to clause 4(b) of the will apply the whole or any part of the income and capital not otherwise disposed of by clause 3(i) to the defendant for his maintenance, education, advancement or benefit.

18 The will falls to be construed in accordance with the principles of construction of wills, with the written words in the will being given their ordinary meaning and the determination of the issues being made by reference to the words used by the testatrix in her will, having regard to any established rules of construction, as well as any statutory provisions that may apply.

19 At common law, the task of a court of construction is to give effect to the intentions of the testator by examination of the words used in the will, having regard to the will construed as a whole, aided as is necessary by any admissible extrinsic evidence.[3]

20 The ten principles relating to the construction of wills are set out by Isaacs J in Fell v Fell, principles that his Honour described as 'incontestable'.[4] Prima facie, the written words in the will must be given their ordinary meaning, with the court making a determination of the issue by reference to the words used by the testator in the will, having regard to any established rules of construction and construing a will 'as trained legal minds would do'.[5] As articulated in the second principle in Fell v Fell, his Honour stated:

The instrument ... must receive a construction according to the plain meaning of the words and sentences therein contained. But ... you must look at the whole instrument, and, inasmuch as there may be inaccuracy and inconsistency, you must, if you can, ascertain what is the meaning of the instrument taken as a whole in order to give effect, if it be possible to do so, to the intention of the framer of it.[6]

21 If, in the context of the will read as a whole and the surrounding circumstances, the ordinary meaning of the words in the will does not make sense, extrinsic evidence is admissible in a court of construction under the 'armchair principle'.[7] This principle allows the court to place itself in the position of the testator at the time of executing the will and take into account all of the circumstances actually known to the testator when the will was made.[8]

22 This approach was succinctly stated by Fullagar J in ANZ Executors & Trustee Co Ltd v McNab:

The search for testamentary intention must be a search for intention disclosed by the words used, and in this search words must prima facie be given their ordinary meanings and, if the law has consistently given a particular meaning to some word or phrase, that is the meaning which the word or phrase must prima facie be given. Nevertheless, the intention is to be gathered from a study of the will as a whole, and in the light of any relevant and admissible evidence of surrounding circumstances.[9]

23 At common law, the general rule is that a testator's declarations as to his or her intentions and the meanings of words used in the testamentary document are inadmissible as direct evidence of testamentary intentions. This means that in most circumstances evidence of instructions of a testator to his or her solicitor would be inadmissible in construing the meaning of a will.

24 The circumstances in which extrinsic evidence may be used and the purposes for which it may be used in interpreting a will are also governed by statute. In Victoria, pursuant to s 36 of the Wills Act 1997, where a will is made on or after 20 July 1998, evidence of the testator's intention is admissible in certain circumstances.[10] The legislation does not oust the armchair principle but supplements it.

25 Where there are cases of uncertainty or ambiguity, evidence may be admitted to assist in the interpretation of the language of the will, both where the uncertainty or ambiguity arises on the face of the will or in light of surrounding circumstances, although in the latter situation evidence of the testator's intention may not be given.

26 As concluded by Atkinson J in The Public Trustee of Queensland v Smith, after setting out the principles applicable to the construction of wills, including s 33C of the Succession Act 1981 (Qld) (the Queensland equivalent to s 36 of the Wills Act 1997):

It follows from the foregoing discussion that the court of construction should start with the words of the will. If their usual meaning is clear, the will will be given that construction. If not, the court may have regard to such extrinsic evidence as allowed by the rules of construction traditionally applied by the courts with the addition of the aids to construction found in s 33C of the Act.[11]

27 A gift of the residuary estate comprises all property not disposed of after payment of debts and liabilities and other devises or legacies under the will. In the event that a testamentary gift fails for any reason - for example, on the grounds of lapse or uncertainty - its subject matter becomes part of the residuary estate, unless the will expresses a contrary intention. Section 35 of the Wills Act 1997 reflects the position at general law. If the residuary gift should fail, at common law, that part of the estate falls to be distributed according to the intestacy rules.

28 Certain presumptions are employed in the construction of wills, one of which is that a court should adopt an interpretation that will not lean to an intestacy or partial intestacy.[12] The presumption against intestacy requires the court to prefer a construction that is reasonably open to avoid an intestacy.[13] However, the court should not lean too heavily against a construction that produces an intestacy and certainly cannot, in order to avoid that result, misconstrue the language of the instrument.[14] The presumption in favour of a testacy rather than intestacy arises where, for example, a testator went through the act of making a will and it is clear from the will that he or she attempted to dispose of all of his or her estate to persons who would be expected to inherit the estate.[15]

29 The presumption that a court leans against a construction that brings about an intestacy is often coupled with the presumption in favour of early vesting, reflecting the assumption that a testator wishes the beneficiary of the gift to benefit as early as possible.[16] This presumption holds all estates to be vested, save where there is a gift that has a condition precedent clearly expressed and to decide otherwise would go against the terms of the will. If there is doubt, a court will lean to an early indefeasible vesting where it is consistent with the natural meaning of the words in the will.[17] The presumption in favour of an early vesting may arise where there is a postponement of a remainder division or payment merely because there is a prior gift for life. Where a will makes it clear that the vesting of a gift is to occur at the date of a testator's death, this would be consistent with a construction favouring early vesting, subject to the beneficiary being divested should a later specified event occur.[18] The presumption cannot apply where a will provides that a gift which fails will revert to the residuary estate.[19] Likewise, where there is a mere power to advance the intermediate income and not a gift thereof or a trust or direction to apply it, a maintenance or advancement clause does not constitute an indication of early vesting.[20]

30 The presumption against intestacy is supplemented by s 46 of the Wills Act 1997 whereby an outcome of an intestacy is avoided in some circumstances. Section 46 of the Wills Act 1997 provides:

(1) A disposition of the whole or of the residue of the estate of a testator which refers only to the real estate of the testator or only to the personal estate of the testator is to be construed to include both the real and personal estate of the testator.

(2) Subsection (1) does not apply if a contrary intention appears in the will.

(3) If any part of -

(a) a residuary disposition which is in fractional parts; or

(b) a disposition of the whole of the estate which is in fractional parts -

fails, the part that fails passes to the part which does not fail and, if there is more than one part which does not fail, to all those parts proportionately.

(4) Subsection (3) does not apply if a contrary intention appears in the will.[21]

31 Section 46(1) is a deeming provision that avoids potential drafting mistakes and the failure of a gift. It ensures that a partial intestacy does not occur in the event, for example, where a testator makes a will with a residuary provision that only refers to the real estate. Without the provision, the will would be construed according to common law principles of construction and there would be an intestacy as to all property that was not real estate. Section 46(1) does not apply if a contrary intention appears in the will.[22]

32 Section 46(3) is intended to ensure that where the residue of an estate is divisible into fractional parts and one such part fails, the part that fails should not pass as on intestacy, but should be added to the other fractional parts. It does not bring about the failure of a disposition but provides for what is to happen to the property that is the subject of a failed disposition.[23] To come within the purview of s 46(3), the residuary estate must be divided between a number of beneficiaries with the disposition expressed in fractional shares, or the intention of the testamentary document must be to dispose of the residuary estate in fractional parts.[24] The provision does not does not apply if a contrary intention appears in the will.[25]

33 In Arnott v Kiss, Hallen J was asked to determine certain questions where a deceased left the residue of her estate to her grandchildren provided they survived her and attained the age of 45 years. The deceased had four grandchildren who survived her but had not yet attained the age of 45 years. The questions asked included whether the residuary clause operated to cause it to vest in interest in the residuary beneficiaries from the date of death of the deceased or whether the gift was subject to a contingency. His Honour determined that for the interest of any grandchild to vest, he or she must not only have survived the deceased, but also to have attained the age of 45 years. His Honour applied the NSW equivalent of s 46(3) in the event that one of the grandchildren did not attain the specified age.[26] He determined that the surviving grandchildren who attain the age of 45 years would be entitled to an equal part of the share of the residue to which the deceased grandchild would have been entitled. If none of the grandchildren attained the specified age, there would be an intestacy.[27]

34 Another example of the application of the section can be found in The Trust Company Limited v Gibson & Anor, a case dealing with the Queensland equivalent to s 46(3).[28] Under her will, the deceased provided for the balance of her residuary estate to be divided between four beneficiaries in equal shares for their own separate and individual use absolutely. One of the residuary beneficiaries disclaimed any interest under this clause. The question to be determined was whether the disclaimer meant that beneficiary's share in the residuary estate passed on intestacy or to the other residuary beneficiaries. Mullins J held that the gift under the residuary clause was characterised as a disposition in fractional parts of the residue as the effect of the clause was to dispose of the residuary estate in fractional parts, with the fraction being determined by the number of survivors.[29] Her Honour also held that the effect of the disclaimer, but for the relevant provision, would mean that the gift would pass on intestacy. As there was no contrary intention disclosed in the will that precluded the application of the section, it was held that it applies to the disclaimed share and it would pass proportionately to the other residuary beneficiaries under the will.[30]

35 Section 46(3) does not have any application where the will fails to dispose of the relevant fractional part of the residuary, for example, where the residuary estate is disposed of in portions but a proportion of the residue is unallocated. This is illustrated by the decision in Re Olive. In that proceeding, a distinction was made between the failure to dispose of a fractional part at all and the disposition in fractional parts where there was a failure of one or more parts for some reason. In the circumstances, it was determined that the relevant statutory equivalent to s 46(3) had no application as the residuary fund that had been disposed of in fractional parts was only part of the residuary fund.[31]

36 The plaintiff accepts that in the event of the defendant's death without leaving any children, at common law, there would be a partial intestacy as to three quarters of the residue of the estate under cl 3(i) of the will. As the deceased was an only child and her parents predeceased her, there is no one within the intestacy provisions who is entitled to take that share and, pursuant to s 55 of the Administration and Probate Act 1958, that share would be taken by the Crown. However, the plaintiff submits that the presumption against intestacy and the application of s 46(3) of the Wills Act 1997 prevents the three-quarters share of the residue of the estate from being forfeited to the Crown on a partial intestacy. It is reasonable and proper to conclude that the deceased did not want three quarters of her estate to be forfeited to the Crown on a partial intestacy. The plaintiff submits that, as there is no contrary intention in the will to prevent s 46(3) from applying, the three-quarters share of the estate passes to the beneficiaries under cl 3(ii) of the will in proportionate parts.

37 The presumption in favour of an early vesting was raised as an issue in the defendant's submissions. The plaintiff submitted that the presumption did not arise as the deceased left specific provision for the defendant, and not an absolute interest in the three-quarters share of the residue of the estate.

38 The plaintiff submits that in addition to the defendant's interest under cl 3(i) of the will for the payment of the weekly amount, she has an absolute discretion under cl 4(b) of the will to provide for the defendant's maintenance, education or advancement, or otherwise for his benefit. The plaintiff is waiting on information from the defendant as to what the defendant seeks in order that she can exercise her discretion.

39 The plaintiff also noted that although the defendant has asserted that he has no children and whilst it is possible that he may have children in the future, it is more probable than not that given his age and circumstances, he will not have any children. In any event, the plaintiff submits that her discretion under cl 4(b) means that she should take into account the possibility that there may be children of the defendant that survive him and attain the age of 21 years and would be entitled to take under cl 3(i) of the will.

40 The defendant's views as to the construction of cls 3 and 4(b) of the will were expressed in his solicitor's letter to the plaintiff's solicitors dated 23 February 2016 as follows:

(a) [Three quarters] is held in trust for the income to go to [the defendant] for life.[32]

(b) On his death, the capital and income of same goes to his children.

(c) There is no provision dealing with the [three quarters] should [the defendant] have no children who take.

(d) That remainder, the remainder interest in the [three quarters] held, is not disposed of by the will.

(e) This gives rise to a contingent, partial intestacy under the will as to that [three quarters] if at [the defendant's] death there are no children to take. Therefore, there would need to be an intestacy as to the remainder, it not having been disposed of in certain circumstances.

(f) If not having been disposed of this will then go to the deceased's next of kin, which is [the defendant].

(g) The contingent intestacy is present now and [the defendant's] death does not prevent him from being the recipient of same, if at the date of death he has no children.

(h) It is not open to say there are no next of kin in that event and [that] it goes to the state, as [the defendant] is the next of kin.

(i) It could be argued that the reference 'as to the remaining' means not just the remaining 25% but any sum remaining, including the contingently undisposed of remainder interest. However, the sub-clause[s] 3(ii)(a) and (b) are framed in the same manner. Initially disposing of the share and then says 'as to the remainder' in a similar manner as to clause 3(i). It may have been clearer to say the (sic) as to the other remaining quarter share in clause 3(i) but this phrase has not been used in clause 3(i) nor in 3(ii)(b).

(j) The presumption against intestacy would apply.

(k) Clause 4(b) is capable of applying only to the [three quarter] share as the other interests are obviously necessarily vested and the right to pay the income or capital as directed is obvious and need not be stated.

(l) This then allows for the executor a discretion to pay the 'capital of the share whether expectant contingent or vested' which [the defendant] takes to him anyway.

41 The defendant submits that if he dies without leaving children, then the remainder of the capital and income of the three-quarters share of the residue of the estate should pass on an intestacy to his estate.

42 The defendant submits that s 46 of the Wills Act 1997 does not apply in the circumstances as it deals with the distinction between real property and personal property. In any event, he submits that a contrary intention should be drawn from the words used in the will, the layout of the will and the unlikely proposition that three quarters of the residue should pass to the other beneficiaries sharing in the remaining one quarter of the residue of the estate.

43 Clause 3(i) also contemplates that the three-quarters share should be held as a discrete sum with such application really only relevant to that portion. This supports the notion that the two separate dispositions in (i) and (ii) are complete codes of disposition for the sums specified.

44 On the issue of the possibility of an early vesting of the three-quarters share of the residue of the estate in favour of the defendant, the defendant supports the plaintiff's submissions.

45 In respect of the trustee's discretion under cl 4(b) of the will, the defendant submits that it applies only to the three-quarters share of the estate as the other one quarter share has been distributed. Whether the defendant has any children who may take under the will is a matter that must await future events and the question of there being an intestacy will be determined at the date of the defendant's death. In the event that the defendant does not have any children and he is entitled to the three-quarters share by way of partial intestacy, it could permit a distribution to the defendant as he has an expectant, contingent or vested interest in the three-quarters share of the residue. Thus, the plaintiff has a discretion to pay the capital of that share to the defendant during his lifetime and, in those circumstances, the plaintiff may make a substantial allocation of capital to him to enable him to purchase a home. He also submits that the trustee's discretion to apply the income or capital of any share 'whether expectant, contingent or vested of any beneficiary' enables the application of the income and capital towards his children while they are under the age of 21 years and may also permit distributions to any of his grandchildren.

Consideration of construction of residuary disposition under clause 3(i) of the will

46 In the event that the defendant should die without children surviving him, at common law the part of the residue of the estate referred to in clause 3(i) of the will would fall to be distributed according to the rules of intestacy. However, the presumption against intestacy requires the court to prefer a construction that is reasonably open that avoids an intestacy without leaning too heavily against a construction that produces an intestacy and not misconstruing the language of the will.

47 The presumption against intestacy is supported in this case by the fact that the deceased went to the effort of making a will with the necessary formality. The language used by her in her will and her provisions for the disposition of her residuary estate show that she did not wish her estate to be distributed according to the rules of intestacy. Her intended scheme of disposition of her estate is seen from the provisions dealing with the residue of her estate. One quarter of the residue of her estate is made to the named beneficiaries who survive her. The remaining three-quarters share of her estate shows her primary intention was to make limited provision for the defendant by providing him with the payment of the weekly amount until his death, and after his death, to provide for any grandchild or grandchildren as shall survive the defendant and obtain the age of 21 years, if more than one as tenants in common in equal shares.

48 The gift over to any grandchild or grandchildren imposes the conditions precedent that they survive the defendant and attain a particular age. Therefore, the payment of the capital and accumulated income from the three-quarters share of the residue to the grandchildren is deferred, 'not merely until the lapse of a definite interval of time ... but until an event, which may or may not happen', resulting in the gift over being contingent.[33] The fact that there are no known grandchildren of the deceased does not affect this conclusion.

49 In the event that the defendant should die without children surviving him, the common law position of an intestacy as to the three-quarters share of the residue is prevented not only by the presumption against intestacy, but by the provisions of s 46(3) of the Wills Act 1997. The manner by which the deceased disposed of her estate is such that it fits within both (a) and (b) of s 46(3): her residuary disposition is in fractional parts and the disposition of the whole of her estate is in fractional parts. There is no contrary intention expressed in the will, so that s 46(4) of the Wills Act 1997 does not apply. The application of s 46(3) means that an intestacy as to the three-quarters share of the residue is prevented in the event that the defendant should die without children surviving him. The part that fails - namely, the three-quarters share of the residue - then passes to the part that does not fail or, if there is more than one part which does not fail, to all those parts proportionately. This means that the three-quarters share of the residue will pass to the named beneficiaries in cl 3(ii) of the will who survived the deceased, being the plaintiff, Mr Wathen and June Pawson or their estates, to be divided in the proportionate parts referred to in that clause.

Consideration of trustee's discretionary power under clause 4(b) of the will

50 Discretionary powers conferred on a trustee must be exercised honestly and for the purposes, express or implied, for which they have been conferred, whether given by the trust instrument, by statute or by the court.

51 Clause 4(b) of the will provides a discretionary power to the plaintiff as trustee of the estate to advance, at her discretion, the whole or any part of the income or capital 'of the share whether expectant contingent or vested of any beneficiary' taking under the trusts in the will for the maintenance, education, advancement or benefit of such beneficiary. This is not a gift or a trust or direction to apply the relevant beneficiary's share of income or capital, but merely a provision that the trustee may do so at her discretion.[34]

52 The discretionary power of the trustee is limited to the application of the income and capital of the share of any beneficiary under the will. The defendant's share under cl 3(i) is limited to the payment of the weekly amount, and no more. The terms of the will are clear in that the deceased intended to limit the defendant's entitlement to the weekly amount, regardless of whether he has children. He has, therefore, a vested interest in respect of the payment of the weekly amount, but, by reason of the application of the presumption against intestacy and s 46(3) of the Wills Act 1997, he does not have an expectant or contingent interest in the three-quarters share of the estate. This means that there is no part of the three-quarters share of the residue of the estate that the trustee could draw upon to exercise her discretion in favour of the defendant.

53 The parties' submissions in respect of the trustee's discretionary power assumed that the trustee has an absolute discretion to provide for the defendant's maintenance, education, or advancement or otherwise for his benefit from the capital or income of the three-quarters share of the residue of the estate. In the circumstances and for the reasons given, that assumption cannot be made. As the submissions were made on a different premise to these findings, it is appropriate that the parties be given an opportunity to file further submissions in respect of the trustee's discretionary power in cl 4(b) of the will.

54 The answers to the plaintiff's questions are as follows:

Whether, on the death of the defendant and assuming he has no children then living, the share that is left by clause 3(i) of the will of the deceased dated 24 November 2004 that has not been already distributed to the defendant by the time of his death [by] way of weekly payments or otherwise goes to:

(b) June Pawson and Wallace Albert Wathen or their respective estates if they do not survive the defendant pursuant to clause 3(ii) of the will and s 46(3) of the Wills Act 1997; or

(c) the Crown by s 55 of the Administration and Probate Act 1958.

(b) The share that is left by clause 3(i) of the will passes to the plaintiff, June Pawson and Mr Wathen to be divided in the proportionate parts referred to in clause 3(ii) of the will.

Whether the defendant has any current entitlement to the balance remaining undisposed of the three quarter share left to him by clause 3(i) of the will pursuant to an interest as next of kin on a partial intestacy as to such balance.

Whether the trustee may in her absolute discretion pursuant to clause 4(b) of the will apply the whole or any part of the income and capital not otherwise disposed of by clause 3(i) to the defendant for his maintenance, education, advancement or benefit.

Further submissions are to be filed by the parties in respect of this question.

55 On or before 27 September 2016, the parties are to file and serve written submissions in respect of the fourth question in the proceeding.

[1] Re Benjamin; Neville v Benjamin [1902] 1 Ch 723.

[2] This amount includes $32,467.82 of accrued interest.

[3] Fell v Fell [1922] HCA 55; (1922) 31 CLR 268; Perrin v Morgan [1943] AC 399.

[4] Fell v Fell [1922] HCA 55; (1922) 31 CLR 268, 273-6.

[5] Ibid 273 (Isaacs J), quoting Ralph v Carrick (1879) 11 Ch D 873, 878 (Cotton LJ).

[7] Boyes v Cook (1880) 14 Ch D 53, 56 (James LJ).

[8] The other instance at common law that allows the admission of extrinsic evidence in a court of construction (which is not relevant in this proceeding) is in the case of equivocations where direct evidence of a testator's actual testamentary intentions may be admitted: see John G Ross Martyn et al, Theobald on Wills (17th ed, Sweet & Maxwell, 2010) 281-3.

[9] ANZ Executors & Trustee Co Ltd v McNab (1999) 3 VR 666, 667.

[10] See Morgan v Moore [2000] VSC 94 (23 March 2000), where a detailed discussion of the legislative history of s 36 of the Wills Act 1997 and its precursor, s 22A of the Wills Act 1958, is set out.

[11] The Public Trustee of Queensland v Smith [2008] QSC 339; [2009] 1 Qd R 26, 33 [26].

[12] Fell v Fell [1922] HCA 55; (1922) 31 CLR 268, 275-6, 279 (Isaacs J).

[14] Arnott v Kiss [2014] NSWSC 1385 (14 October 2014) [63] (Hallen J) (citations omitted).

[15] Re Harrison; Turner v Hellard (1885) 30 Ch D, 390, 394 (Lord Esher MR); Public Trustee v Executor Trustee & Agency Co of South Australia Ltd (1984) 36 SASR 32, 39 (Wells J).

[16] Public Trustee v Bennett [2004] NSWSC 955 (18 October 2004) [23] (Gzell J).

[17] Wyatt v Perpetual Trustee Co Ltd [1917] HCA 16; (1917) 23 CLR 14, 19 (Isaacs J).

[18] Marshall v Tasmanian Perpetual Trustees Ltd [2015] TASFC 2 (10 March 2015) [23] (Estcourt J), quoting Bradshaw v Bradshaw [2003] TASSC 138 (17 December 2003) [13] (Crawford J) and the cases cited therein.

[19] Re Butler [1980] Qd R 601, 605 (Connolly J); In re Whittle [1970] SASR 546, 554 (Wells J).

[20] Re Butler [1980] Qd R 601, 603-4 (Connolly J), citing In re Blackwell; Blackwell v Blackwell [1926] Ch 223, 236-7 (Warrington LJ). See also Austin v Wells [2008] NSWSC 1266 (28 November 2008) (White J) [29].

[21] Similar legislation is in place in the other States and Territories, save for the ACT and SA: see Succession Act 2006 (NSW), s 42; Wills Act 2000 (NT), s 41; Succession Act 1981 (Qld), s 33P; Wills Act 2008 (Tas), s 56; Wills Act 1970 (WA), s 26(1)(g).

[22] Wills Act 1997, s 46(2).

[23] Trust Co of Australia Ltd v Krannin [2006] QSC 280; [2007] 1 Qd R 188, 196 [28] (Fryberg J), referring to the equivalent Queensland provision.

[24] Ibid 196-7 [29]; The Trust Company Limited v Gibson & Anor [2012] QSC 183 (29 June 2012) [30] (Mullins J).

[25] Wills Act 1997, s 46(4).

[26] Succession Act 2006 (NSW), s 42(2).

[27] Arnott v Kiss [2014] NSWSC 1385 (14 October 2014) [53].

[28] Succession Act 1981 (Qld), s 33P(1).

[29] The Trust Company Limited v Gibson & Anor [2012] QSC 183 (29 June 2012) [30].

[31] Re Olive [1989] 1 Qd R 544, 546 (Demack J), applying the predecessor to s 33P of the Succession Act 1981 (Qld) (s 29(b)). See also Stephens v Stephens [2007] QSC 16 (8 February 2007) [43] (Philippides J).

[32] The first point (a) that three quarters of the residue of the estate is 'held in trust for the income to go to the defendant for life', is incorrect. Clause 3(i) provides that the defendant has a specific provision of the payment of the yearly amount for his life, not an absolute right to receive all of the income from the three-quarters share of the estate.

[33] Arnott v Kiss [2014] NSWSC 1385 (14 October 2014) [53] (Hallen J).

[34] Ibid [59] (Hallen J), quoting In re Hume; Public Trustee v Mabey [1912] 1 Ch 693, 699 (Parker J).