Plaintiff v Defendants

2 The deceased's will dated 18 April 2016 appoints the plaintiff and first defendant as executors and divides her estate into one third equal shares, with one third each to the plaintiff and Thomas and the remaining one third to the first defendant's adult children, Felicia and Brandon Boglis. It is common ground that the first defendant requested the deceased to leave the remaining one third share to his two children.

3 The deceased's estate comprises the deceased's home in Murray Road, Preston and less than $4,000 in the bank. Despite the relatively straight forward nature of the deceased's estate, since the death of the deceased there have been significant disputes between the plaintiff and the first defendant in the process of attempting to obtain a grant of probate of the deceased's will.

4 At the date of the deceased's death, the will was in the possession of Portfolio Law. As is the usual course, Portfolio Law required the authority of both named executors before releasing the will. The first defendant would not provide the necessary authority.

5 On the first return of the proceeding, orders were made for Portfolio Law to deliver the will to the Registrar of Probates by 3 May 2021. Portfolio Law produced the will to the Court on 17 August 2021. On or about 5 November 2021 the Court forwarded the will to the plaintiff's solicitors.

6 On 26 November 2021 the plaintiff informed the Court that the plaintiff would discontinue the proceeding against Portfolio Law.

7 By originating motion filed 12 March 2021 the plaintiff sought, inter alia, that the first defendant renounce probate, alternatively, that he be passed over and the plaintiff be entitled to prove the deceased's will. The application was supported by the plaintiff's affidavit sworn on 12 March 2021.

8 The plaintiff deposed that originally the first defendant would not do anything to administer the estate or authorise the release of the deceased's will until 22 August 2022, being just over two years after the deceased's death. In the meantime, the first defendant was living in the Preston property with his two adult children rent free. The first defendant disputed that he said he would not vacate the Preston property until 22 August 2022, asserting that he said he would vacate the property by 15 August 2021. The plaintiff also deposed to issues such as not knowing whether the Preston property was insured or if the outgoings for the property were being paid. There were also disputes over the internal and external condition of the Preston property. When the first defendant and his adult children finally vacated the Preston property, the property was left in a complete mess.

9 The plaintiff's brother, Thomas, supports the plaintiff's application.

10 On 13 September 2021 the parties signed terms of settlement. By the terms of settlement the first defendant was required to vacate the Preston property by 24 October 2021, execute an exclusive auction authority appointing the real estate agency, Nelson Alexander, to sell the Preston property and agree to a reserve price of $1,100,000. The reserve price for the Preston property was based on a kerb side valuation undertaken as at 31 July 2021 by James Labiris, a licensed real estate agent and auctioneer with Nelson Alexander, on the basis of the property's development potential as at 31 July 2021. His view was that a realistic price expectation was in the vicinity of $1.1 to $1.2 million on the basis that the house was consistent with its internal and external appearance. He considered it was highly unlikely the Preston property would be purchased for renovation, but that that could not be ruled out.

11 The plaintiff submits that since the death of the deceased the conduct of the first defendant caused ongoing delay which was not in the interests of the beneficiaries and was inconsistent with the due and proper administration of the estate.

12 The plaintiff submits that after the terms of settlement were signed by the parties, the first defendant initially refused to vacate the Preston property by the agreed date. When he did vacate the Preston property, the property was littered with garbage and other rubbish and that generally the property bordered on the unliveable.

13 In early November 2021 Mr Labiris revisited the reserve price of the Preston property after a complete inspection of the property, as opposed to his earlier kerb side valuation. Mr Labiris' opinion was that the value of the property was between $959,000 and $995,000. The first defendant refused to accept the revised valuation, stating that he wanted the reserve price for the property to be $1.5 million.

14 The plaintiff also submits that the first defendant is generally difficult and can be agitated and emotional. The plaintiff also raised an incident that occurred on 9 November 2021 where the plaintiff's solicitor became aware that the first defendant listened in on a telephone call between her and the first defendant's solicitor.

15 On the first return of the plaintiff's application on 23 April 2021, the first defendant appeared in person. Orders were made for Portfolio Law to deliver the will to the Registrar of Probates by 3 May 2021 and the proceeding was adjourned to 7 May 2021.

16 By orders made on 3 June 2021 the first defendant was to file any affidavits in opposition to the plaintiff's application by 9 July 2021.

17 On 13 September 2021 the parties signed the terms of settlement.

18 On 21 September 2021 consent orders were made authorising the release of the original will to the plaintiff's solicitors and listing the proceeding for directions.

19 On 28 October 2021 the proceeding was adjourned by consent.

20 On 26 November 2021, orders were made for the first defendant to file and serve any affidavits on which he intended to rely by 22 December 2021 and for the plaintiff to file and serve any affidavits in response by 21 January 2022.

21 The proceeding was listed for trial on an estimate of a half day.

22 The plaintiff relies on his affidavits sworn 12 March 2021 and 21 January 2022, the affidavits of Jamie Griffin, solicitor, sworn 25 November 2021, James Labiris sworn 20 January 2022, Connie Boglis sworn 21 January 2022 and Thomas Boglis sworn 3 February 2022. Certain objections were made by the first defendant to the affidavits relied on by the plaintiff. These objections were resolved between the parties prior to the trial of the proceeding.

23 The first defendant relies on his affidavits sworn on 29 July 2021 and 22 December 2022.

24 The first defendant submits that whatever the merits of the plaintiff's complaints as at 13 September 2021, which are denied by the first defendant, by the terms of settlement, the plaintiff released the first defendant from them and included in the matters that were released was the claim that the first defendant be passed over as executor of the estate. The terms expressly permitted that they may be produced as a bar to any proceeding brought contrary to that release.

25 The first defendant accepts that the plaintiff has the right to seek that the first defendant be passed over on matters that occurred after the date of the terms of settlement, but submits that the plaintiff cannot rely on any matter that was known or ought to have been known as at the execution of the terms.

26 The first defendant denies the plaintiff's complaints that he unduly delayed making any application for a grant of probate; acted improperly in relation to the Preston property since the death of the deceased and generally; and acted unreasonably in relation to the sale of the property. He submits that even if the plaintiff's complaints are made out, the degree of imprudence is not sufficient to warrant passing over the first defendant.

27 An executor's ability to act commences upon the death of the testator. The due and proper administration of the estate requires an executor to call in the assets, pay the testator's debts with reasonable diligence having regard to the assets available and properly applicable for that purpose, secure the estate assets, and ascertain the liabilities of the estate.

28 Prima facie, a person nominated as executor by a testator is entitled to a grant of probate.[1] However, the Court has both statutory and inherent power to pass over a named executor and grant the right to administer an estate to another person if this is necessary for the due and proper administration of the estate.[2] The statutory power is found in s 15 of the Administration and Probate Act 1958 (Vic), which provides that the Court may order an executor of a will who neglects to prove the will, within six weeks of the date of death, to show cause why he or she should not prove the will or alternatively renounce probate thereof. The power to pass over an executor has long been recognised as part of the Court's inherent jurisdiction concerning the administration of deceased estates.[3]

[T]his Court's jurisdiction in Victoria is unlimited and its probate jurisdiction pursuant to the [Act] and the Supreme Court Act 1986 (Vic) is broad and brings with it an inherent power necessary to the effective exercise of the jurisdiction granted. That power extends to prevent steps being taken that would lead to injustice or render the grant inefficacious. This is expressed in different ways depending on the circumstances. Another way of expressing the power is that it is a power to maintain the authority of the court and to prevent its processes from being obstructed and abused. Where an application for a grant of probate is made to an executor appointed by a deceased's will and the circumstances show that the executor is liable to be removed, passing over that executor will prevent the grant leading to injustice or being rendered inefficacious, obstructed or abused.

Where the Court exercises the power to pass over a named executor, it does so having regard to the due and proper administration of the estate and the interests of the parties beneficially entitled to the estate. The consequence is that either the other named executors will receive a grant of representation or letters of administration with the will annexed will be granted to someone else.[5]

30 Overall the primary concern of the Court is to ensure that the estate will be duly and properly administered according to the terms of the will,[6] with the dominant consideration being the welfare of the beneficiaries.[7]

31 Despite the estate of the deceased comprising only the Preston property and a small amount of savings, the proceeding has generated a multitude of affidavits and caused substantial delay in the commencement of the administration of the estate, in what should have been an uncomplicated administration.

32 The aforementioned incident that occurred on 9 November 2021 between the solicitors for the parties perhaps highlights the amount of discord and emotion generally in the litigation. On that occasion the first defendant's solicitor called the plaintiff's solicitor. During the course of their discussion, the plaintiff's solicitor heard a third voice yelling in the background. She challenged the first defendant's solicitor about this and was informed by him that the first defendant was listening to the conversation on another telephone. The plaintiff's solicitor objected and ended the call. The next day the first defendant's solicitor explained the incident to the plaintiff's solicitor stating that he ceased the conversation as soon as the plaintiff's solicitor complained about the first defendant listening to the call. The plaintiff's solicitor rejected the explanation giving her reasons for doing so. While the accounts of the solicitors differ on what occurred, such an event possibly affected their ability to co-operate in a professional manner. However, the incident is not directly relevant to the application before the Court.

33 The events in dispute after the terms of settlement were signed surround the first defendant and his children vacating the Preston property, the cleaning up of the property, the valuation of the property and the proposed reserve price for the auction of the property.

34 The deceased died in August 2020. Prior to the deceased's death, the first defendant and his children lived in the Preston property for many years rent free. After the death of the deceased in August 2020, the first defendant and his two children remained in the Preston property without paying any rent. This was an issue between the parties at the commencement of the proceeding.

35 Pursuant to the terms of settlement, the first defendant was required to vacate the Preston property by 24 October 2021. Correspondence between the respective solicitors dealt with the issue of whether the first defendant had vacated the Preston property, with the plaintiff's solicitor enquiring whether the Preston property had been vacated. On 27 October 2021 the first defendant's solicitor informed the plaintiff's solicitor that the first defendant had vacated the Preston property. The issue emerging from his vacation of the Preston property was that the property was left in a condition where rubbish had not been removed from the property nor had the house and surrounds been cleaned up.

36 After Mr Labiris was appointed by the parties to conduct the valuation and sale of the Preston property, he deposed to encountering some difficulty in dealing with the first defendant, including initially preventing the agent from inspecting the property in early October 2021. The first defendant denies that he prevented the agent from inspecting the Preston property. Emails detailing these difficulties and relevant responses were exhibited to the affidavits sworn by the respective solicitors. The plaintiff's solicitor alleged that the conduct of the first defendant was a repudiation of the terms of settlement. The first defendant's solicitor denied the conduct and any repudiation of the terms of settlement.

37 Mr Labiris subsequently conducted a full inspection of the Preston property. His inspection occurred prior to the removal of all the rubbish and the clean up of the property. As a result of the condition of the Preston property, Mr Labiris revised his valuation to an amount between $950,000 and $995,000.

38 On 10 November 2021 Mr Labiris called the first defendant to discuss the sale authority for the Preston property. He deposed that the first defendant refused to agree to the revised valuation, insisting that he could achieve a sale price of $1.5 million or more and that he would not agree to a price less than $1.4 million. After this discussion, Mr Labiris sent an email to the respective solicitors confirming the discussion and setting out his views as to what would occur, which reads in part:

[The first defendant] has mentioned that he has other agents indicating to him that he could easily get $1.5m or more... [The first defendant] has blatantly told me he will not sell unless he gets his desired price which is a 'hell of a lot more' that $1m. He made it very clear he will not sell and will not sign at that price point.

39 On 12 November 2021 Mr Labiris sent a further email to the respective solicitors confirming that the first defendant had made it clear he wanted a sale price of $1.4 million. Mr Labiris' view was that while the Preston property could be put on the market at a reserve of $1.1 million, his opinion was that the reserve should be reduced and under no circumstances would he suggest it be listed at $1.4 million. Mr Labiris sought guidance as to the next steps for the sale of the Preston property.

40 On 16 November 2021 the plaintiff's solicitor sent an email to the first defendant's solicitor enclosing Mr Labiris' correspondence together with the photographs of the Preston property showing the state of the property.

41 On 19 November 2021 the first defendant's solicitor responded alleging that the rubbish at the Preston property was hoarded by the deceased over the extensive time that she lived at the property. He asserted that the valuation of the Preston property could not be properly undertaken until the work required for the preparation of the property for sale was completed. His position was that once the Preston property was properly prepared for sale, the first defendant would agree to a reserve price on the property. The plaintiff's position regarding the rubbish and other items left at the Preston property was that they were the responsibility of the first defendant and he provided reasons for his views.

42 The plaintiff's solicitor responded to the first defendant's solicitor on the same day alleging that the first defendant was in breach of the terms of settlement and was not acting in the interests of the estate. The first defendant had been notified of the breach and called upon to remedy it and it was clear from the correspondence that the first defendant would not remedy it. The plaintiff was said to accept the repudiation. The plaintiff's solicitor informed the first defendant's solicitor that he was instructed to press the plaintiff's application for the first defendant to be passed over as executor of the estate.

43 On 23 November 2021 the first defendant's solicitor informed the plaintiff's solicitor that the first defendant had agreed to a sale of the Preston property with the proviso that a proper reserve price be set after the property 'has been properly presented for sale' and that the first defendant was not responsible to pay for the removal of all the items left at the premises by the deceased.

44 The issue of the amount of rubbish left at the Preston property when the first defendant vacated it was a significant issue. The Preston property was left in a filthy state, with rubbish both inside and outside the house. No cleaning had been done, bins were not emptied, garden waste was not disposed of, taps were dismantled and appliances inside the Preston property were unclean. The first defendant maintained that the rubbish belonged to the deceased, rather than him, as the reason for not dealing with the cleaning up and removal of the rubbish before vacating the Preston property. As stated above, the plaintiff disagreed with the first defendant's views on these issues.

45 The plaintiff ultimately remedied these issues in November 2021 by arranging for Skips on Wheels Rubbish Removal to clean up the Preston property and remove all the rubbish at a cost of $3,250. The plaintiff paid the account and is entitled to claim it from the estate in due course.

46 Of the four beneficiaries of the estate, Thomas supports the plaintiff's application to pass over the first defendant. Together they are entitled to two thirds of the estate. The first defendant's adult children are together entitled to one third of the estate. Their views on the plaintiff's application are unknown.

47 As a result of the disputes between the parties the estate comprising the Preston property and a small amount of savings remains unadministered to the detriment of the beneficiaries of the estate. The administration of the estate should not have been delayed in the manner that has occurred. The circumstances that have caused the delay since the terms of settlement were signed arise from the first defendant's conduct which appears to have been aggravated by his consideration of his own interests, in particular in not dealing with the cleaning up and removal of the rubbish before vacating the Preston property. He also showed himself to be obstructive in his refusal to accept professional advice as to the appropriate manner to sell the Preston property. What should have been a relatively straight forward administration became a drawn out and combative process that is not in the interests of the beneficiaries. If the first defendant is not passed over, it is likely that the estate will continue to remain unadministered. In the circumstances, it is in the interests of the beneficiaries that the first defendant be passed over so that the estate can be duly and properly administered according to the terms of the will.

48 The Court orders that the first defendant be passed over. In the event that the parties are unable to agree on the costs of the proceeding, written submissions are to be filed by 29 June 2022.

[1] Evans v Tyler [1849] EngR 1120; (1849) 2 Rob Ecc 128, 131; [1849] EngR 1120; 163 ER 1266, 1267 (Sir Herbert Jenner Fust); Tsaknis v Lilburne [2010] WASC 152, [60]-[61] (EM Heenan J).

[2] Re Crane [2005] SASC 379; (2005) 93 SASR 198.

[3] See, eg, Re Swale [1960] SASR 391, 394 (Napier J); Re Smith (deceased) (1972) 2 SASR 477, 478-9 (Walters J); Re Crane (n 2) [15]-[30] (Besanko J); Re Munro [2018] VSC 747, [35] (Derham AsJ).

[5] Ibid [35]-[36] (citations omitted).

[6] Re Loveday [1900] UKLawRpPro 13; [1900] P 154, 156 (Jeune P); Bates v Messner (1967) 67 SR (NSW) 187; Mavrideros v Mack (1998) 45 NSWLR 80, 107-8 (Sheller JA).

[7] Miller v Cameron [1936] HCA 13; (1936) 54 CLR 572; Elovalis v Elovalis [2008] WASCA 141, [30]-[40] (Martin CJ, with whom Buss JA and Newnes AJA agreed).