SUCCESSION - Trusts and trustees - Judicial advice, Trustee Act 1925 (NSW), s 63
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SUCCESSION - Trusts and trustees - Judicial advice, Trustee Act 1925 (NSW), s 63
Judgment (6 paragraphs)
[1]
Judgment
HER HONOUR: This is an application, by summons filed on 15 October 2019, by the executors of the estate of the late Stasha Berger (the deceased), who was also known as Stanislava Bergerova, for judicial advice pursuant to s 63 of the Trustee Act 1925 (NSW) (the Trustee Act) as to whether they would be justified in paying 80% of the residue of the deceased's Estate to the Trustees of the Order of the Capuchin Friars Minor (the Capuchin Friars).
[2]
Background
The background to the present application is set out in the affidavit sworn 12 September 2018 by one of the executors, Mr Andrew Wallace Bruce Dickinson, solicitor, and in a statement of facts filed 4 June 2020 and tendered on this application (which I will admit as Exhibit A on the present application).
The deceased, a widow, died on 4 January 2018 leaving no children, spouse or partner but with a number of surviving second cousins. Probate of the deceased's Will, made on 21 December 2017, was granted by this Court on 2 May 2018 to Mr Dickinson and Mr Leslie Joseph Beck (the deceased's friend), who were appointed as executors and trustees under the deceased's Will.
Mr Dickinson, the solicitor who prepared the Will, has deposed that the deceased (who he knew to be a widowed lady who resided on her own in a unit in Rose Bay in Sydney) provided instructions in relation to the Will, including for "a bequest to be made to Shrine of Saint Anthony of Padua Capuchin Friars Minor Hawthorn - Melbourne Victoria" (see at [4] of his 12 September 2019 affidavit). Mr Dickinson has also deposed that the deceased, who was of Czech descent, had said to him in or about May 2017 words to the effect "I wish to be buried in a pre-paid plot in the Czech Republic" and "I intend to move back to Prague in 2018" (see at [6]-[7] of his affidavit).
The estate consists of real estate in Australia and Prague, money on deposit with Westpac and bank accounts held in Switzerland together with pension funds and superannuation.
Clause 3 of the Will expressed the wish that the deceased be cremated and her ashes deposited in her reserved plot in Vinoh Radsky Cemetery, Prague, Czech Republic and directed that the rent for the plot be paid out of the deceased's residuary estate.
Clause 4 of the Will bequeathed the contents of the deceased's safe deposit box at a bank in Zurich to her second cousin, Dagmar Stadelmann.
By cl 5 of the Will, the deceased left a series of pecuniary legacies to friends, second cousins (including Dagmar Stadelmann) and her accountant.
Clause 6 of the Will was a bequest, conditional on the acceptance of Mr Beck of the appointment as executor and trustee, of a pecuniary legacy to Mr Beck.
By cl 7 of the Will, the deceased devised and bequeathed certain property situated in Prague (and any moneys held on deposit in a bank or financial institution in Prague) upon trust for Dagmar Stadelmann and Renata Malaniukova in equal shares as tenants in common.
Clause 8 of the Will dealt with the residue of the deceased's estate, divided as follows: (a) as to 80% upon trust for "Shrine of Saint Anthony of Padua Capuchin Friars Minor Hawthorn - Melbourne Victoria", declaring that "the receipt of the secretary or the treasurer for the time being of such organisation shall be of sufficient discharge of my trustees for the moneys payable under this my Will"; and (b) as to the remaining 20% upon trust for Dagmar Stadelmann (or, if Dagmar Stadelmann did not survive her, to Renata Malaniukova).
The inventory of property annexed to the grant of probate discloses several parcels of real estate, a significant sum of money in banks or financial institutions and a substantial sum held in a superannuation fund which is payable to the estate. The net value of the estate is estimated by the executors at approximately $10,000,000 (see Statement of Facts at [6]). The net value of the residuary gift (to the "Shrine") under cl 8(a) of the Will is estimated at $7,500,000 (see Statement of Facts at [9]).
Dagmar Stadelmann presently resides in Switzerland (see Statement of Facts at [8]). Ms Stadelmann has been notified of the present application and of the opportunity to make submissions as to the application.
The Shrine of Saint Anthony of Padua Capuchin Friars Minor Hawthorn - Melbourne Victoria (the Shrine) is situated at 182 Power Street, Hawthorn, Victoria (see Statement of Facts at [11]). The registered proprietors on the title of that property are "Trustees of the Order of the Capuchin Franciscan Fathers of 98 Catherine Street Leichardt [New South Wales]" (see Statement of Facts at [12]).
The Shrine, which is referred to in cl 8(a) of the Will, is not a legal entity. Rather, it is an existing religious shrine in Victoria (to the Patron St Anthony of Padua), which is administered by a religious order (the Order of the Capuchin Friars Minor) that is associated with or forms part of the Roman Catholic Church (see the affidavit sworn 17 September 2019 by Father Julian Messina, the assistant director of The Order of the Capuchin Friars Minor (the Capuchin Friars)).
As is evident from the fact that an affidavit has been sworn in the proceedings by Father Messina, the Trustees of the Order of the Capuchin Friars Minor have been notified of and given an opportunity to make submissions on the present application.
Father Messina has deposed that the canonical name of the Order is "The Order of the Capuchin Friars Minor" (see at [2]); that the corporate name is "Trustees of the Order of the Capuchin Friars Minor" (see at [3]).
The Trustees of the Order of Capuchin Friars Minor are constituted as a body corporate pursuant to the Roman Catholic Church Communities' Lands Act 1942 (NSW) (the Roman Catholic Church Communities' Lands Act).
Previously, the Order was known as "The Order of the Capuchin Franciscan Fathers" and the Trustees of the Order of Capuchin Friars Minor were known as the "Trustees of the Order of the Capuchin Franciscan Fathers" (the name appearing on the title to the property on which the Shrine is located).
The canonical and corporate names of the Order were amended pursuant to a proclamation published in the New South Wales Government Gazette on 28 March 2002, which amended the Second Schedule to the Roman Catholic Church Communities' Lands Act in this regard.
As noted, the Trustees of the Order of the Capuchin Friars Minor administer the Shrine. Father Messina has deposed that the Capuchin Friars are one of many religious orders which are part of the Catholic Church in Australia (see his affidavit at [14]) but that there is only one Order of the Capuchin Friars in Australia (see his affidavit at [16]) and that Order falls under the Archdiocese of Melbourne (see his affidavit at [15]; Statement of Facts at [13]). Father Messina has deposed that the Order is also known as the "Capuchin Franciscans" (see his affidavit at [8]).
A copy of the Constitution of the Capuchin Friars is annexed to Father Messina's affidavit. Father Messina notes that the head office of the Capuchin Friars is situated at 96 Catherine Street, Leichhardt, New South Wales and that there is a church and primary school located at that address which are served by the Capuchin Friars (see his affidavit at [20]-[21]).
Father Messina is one of the current office bearers of the Order (see [10] of his affidavit) and, as such, is one of the trustees of the Order pursuant to the constitution (see [11] of his affidavit). He deposes that he is authorised to make his affidavit "on behalf of the Shrine of Saint Anthony of Padua Capuchin Friars Minor Hawthorn - Melbourne Victoria and the Order of the Capuchin Friars Minor" (see [12] of his affidavit).
Father Messina has deposed that bequests are received (by the trustees, I assume) "in the name of the Shrine of Saint Anthony of Padua Capuchin Friars Minor Hawthorn - Melbourne Victoria" and "are used to maintain the Shrine … as well as to fund work undertaken from the Shrine such as assisting migrant groups and homeless people" (see [24]-[25] of his affidavit). The main bank account through which the business of the Trustees of the Order of the Capuchin Friars Minor operates (and receives large donations) is a Commonwealth Bank account in the name of the "Capuchin Franciscan Friars" (see Statement of Facts at [30]).
The statement of facts records that the deceased knew a Capuchin Friar known as Father Andrew Hrdina (see Statement of Facts at [25]). Father Messina deposes to having been informed of this (see [28] of his affidavit). Father Messina has deposed that Father Hrdina was a Capuchin Friar based in Sydney for a long time where he was both chaplain to a nursing home and also working with the Czech community (see [30]-[31] of his affidavit) (of which community the deceased was part). Father Messina has described Father Hrdina (who he knew prior to Father Hrdina's death about four years ago at the age of 94) as a "colourful and extremely affable man who did anything for people and was very well liked by the Czech community" and deposes that Father Hrdina was particularly involved with people who did not have children and that he had many friends in the Rose Bay area of Sydney (see [32]-[34] of his affidavit).
Father Messina has deposed that, through Father Hrdina's ministry as chaplain to the Czech community, many gifts have been received over the years addressed to the "Shrine of Saint Anthony of Padua Capuchin Friars Minor Hawthorn - Melbourne Victoria" and that this was the name he would provide to people wishing to make gifts to the Capuchin Friars (see [37]-[38] of his affidavit).
[3]
Issue for determination
Senior Counsel whose opinion has been provided in relation to this application (Dr Birch SC) has advised the executors that it is arguable that there is ambiguity in the terms of cl 8(a) of the Will in that it is not clear whether the gift is intended to be for the Shrine of St Anthony (that is, being a gift for the upkeep, maintenance and purposes of the Shrine) or a gift to the Capuchin Friars Minor (that is, being a gift to that Order) and that, because of the ambiguity regarding the recipient of the gift and the purpose for which the gift was intended, the executors would be justified in seeking judicial advice pursuant to s 63 of the Trustee Act.
Senior Counsel's opinion (with which I agree) is that the evidence of Father Messina (admissible as extrinsic evidence to assist in the interpretation of the language used in the Will - see s 32 of the Succession Act 2006 (NSW)) establishes that the overwhelming likelihood is that the terms used in cl 8(a) of the Will had their origin in advice given by Father Hrdina to the deceased. Senior Counsel has also advised his opinion (with which, as will be seen, I do not wholly agree) that the likelihood is that the intention of the deceased was to make a gift to the Order of the Capuchin Friars Minor for the preservation of the Shrine and the carrying out of the community and pastoral work of the Friars associated with the Shrine.
More specifically, Dr Birch SC has expressed the opinion that the likelihood is that the intention of the deceased, given the wording of cl 8(a) and the reference not merely to the Shrine but also to the Capuchin Friars Minor, was to make a gift not merely for the upkeep of the Shrine but for the activities undertaken by the Capuchin Friars associated with the Shrine (by which I understand Senior Counsel to be referring to activities such as the assistance of migrant groups and homeless people). Accordingly, it is the opinion of Senior Counsel that the executors would be justified in paying 80% of the residue of the deceased's estate to the Trustees of the Order of the Capuchin Friars Minor.
Further, Senior Counsel has advised the executors that the Trustees should be informed of the terms of the Will and that it was a gift made upon trust for "Shrine of Saint Anthony of Padua Capuchin Friars Minor Hawthorn - Melbourne Victoria".
Senior Counsel's understanding is that, if the bequest was made in that name, it is the trustees' intention to use the bequest to maintain the Shrine and to fund work undertaken "from" the Shrine (such as assisting migrant groups and homeless people).
[4]
Determination
At the outset, I note that the application for judicial advice is appropriately made by the executors in circumstances where they consider there to be ambiguity as to the words of the Will (and have received advice to that effect).
I bear in mind that, where an issue arises as to the construction of a will, it has been said (as Dr Birch SC has adverted to) that the first duty of the Court is to discover the meaning of the language of the testator as applied to the circumstances existing at the date of the Will and to give effect to the intention so discovered unless some authoritative rule of law or construction requires a different conclusion (see Nicol v Chant (1909) 7 CLR 569 at 577; [1909] HCA 4 per Griffith CJ). Further, the executors have submitted that, so far as possible, the Court must ascertain and adopt a construction of the Will that avoids an intestacy (while not citing authority, no doubt having regard to authorities which have had regard to the presumption against intestacy - see, for example, Andrews v National Trustees Executors and Agency Company of Australasia Ltd [1936] 56 CLR 1 at 14; [1936] HCA 54 per Dixon J).
In Fell v Fell (1922) 31 CLR 268 at 274; [1922] HCA 55, as noted by the executors, Isaacs J (as his Honour then was) said that "'[i]t if the will shows that the testator must necessarily have intended an interest to be given which there are no words in the will expressly to devise, the Court is to supply the defect by implication, and thus to mould the language of the testator, so as to carry into effect, as far as possible, the intention which it is of opinion that the testator has on the whole will, sufficiently declared'" (his Honour there quoting Towns v Wentworth (1858) 11 Moo PCC at 543; Hawkins on Wills (2nd ed, Sweet & Maxwell, 1912) at 6). It is further noted that, in so doing, the Court is to put itself in the "armchair of the deceased" when construing the words in the Will, knowing what the deceased knew.
The executors argue, noting that the Shrine is not a legal entity, that the words of the Will and the surrounding facts and circumstances support a finding that it was the intention of the deceased to make a charitable gift to the Capuchin Friars. The executors, noting that the Trustees of the Order of the Capuchin Friars Minor are the owners of the Shrine and undertake charitable work through or from the Shrine, submit that the extrinsic evidence supports an implication of the intention of the deceased to make an unconditional charitable gift to the Trustees of the Order of the Capuchin Friars Minor to undertake their charitable work through the Shrine.
Pausing here, whether or not the bequest would be construed as a charitable gift (applying the test in Commissioners for Special Purposes of Income Tax v Pemsel [1891] AC 531 (Pemsel's Case)) is not here dispositive. Indeed, it must be noted that not every trust object that might be brought within those classes recognised in Pemsel's Case is ipso facto a charitable trust; rather, whatever category it may come within, the trust must also be of a public nature and capable of control by the courts.
In this regard, as has been noted and at risk of belabouring the obvious, the identification by cl 8(a) of the ""Shrine of Saint Anthony of Padua Capuchin Friars Minor Hawthorn - Melbourne Victoria" is productive of much ambiguity. As K S Jacobs QC (as his Honour then was) argued in Joyce v Ashfield Municipal Council (1959) 4 LGRA 195 (at 196):
To speak of institutions or entities as public charities is to introduce a concept which is not only confusing, but inaccurate. Unless an institution or entity, which is loosely called a charity, is bound as trustee to carry out a public charitable purpose, there is no public charity. If it is bound the public charity is not the institution itself, but the institution as an organisation subject to an established trust for charitable purposes.
The learned authors, J D Heydon and M J Leeming, of Jacobs' Law of Trusts in Australia (8th ed, 2016, LexisNexis) note that Sir Kenneth's argument was subsequently approved by Else-Mitchell J in McGarvie-Smith Institute v Campbelltown Municipal Council (1965) 83 WN (NSW) 191 at 192 (and citing also The Will of Scales [1972] 2 NSWLR 108).
I can readily accept that, in some cases, the name of an institution or site may descend in every day usage to mean, or connote, something more than strictly, or perhaps literally and formally, the institution or site itself. So, for example, if one were contemplating, say, a bequest "to the Australian War Memorial" one may intend to put that bequest to the many and varied functions and endeavours undertaken by the Australian War Memorial corporation - for example, research into matters pertaining to Australian military history, the running of the museum or, perhaps, the acquisition of art and artefacts - and not only to maintenance of the Memorial itself.
However, in such a case, it remains necessary for the donor to identify the purposes to which the bequest can be put. While that purpose may be described and identified in general terms (for example, "to be applied to the general purposes of…"), it is still necessary to do so. Here, cl 8(a) fails expressly to do so.
To my mind, the short point here is that no charitable purpose, or even any specific purpose at all, is disclosed by the language of the bequest. Nothing, however, here turns on this.
Similarly, nor does anything turn on the fact that the Order has changed its canonical and corporate name. It is clear on the evidence that the religious order formerly known as the "Order of the Capuchin Franciscan Friars" and administered by the Trustees of the Order of the Capuchin Franciscan Friars is now the "Order of the Capuchin Friars Minor" (administered by the Trustees of the Order of the Capuchin Friars Minor). It is also clear that, notwithstanding the terms in which the Order's bank account is styled, payment by direction of the Trustees of the Order of the Capuchin Friars Minor to a bank account in the name of the "Capuchin Franciscan Friars", if coupled with a receipt from the secretary or the treasurer for the time being of the Trustees of the Order of the Capuchin Friars Minor, would be sufficient discharge of the trustees for the moneys under the bequest in cl 8(a) of the Will.
Rather, and as adverted to above, the more problematic issue is whether the evidence establishes that the intention of the deceased was most likely to have been to make a gift under the Will to the Trustees of the Order of the Capuchin Friars for the purposes of the upkeep and maintenance of the Shrine or, instead, a more general intention for the gift to be for the Order of the Capuchin Friars and available for activities undertaken by the Order of the Capuchin Friars (or those activities undertaken by the Order that are associated with the Shrine but not necessarily limited to the upkeep and maintenance of the Shrine), such as funding the work carried out from the Shrine of assisting with migrants and homeless people.
In this respect, the inclusion of the word "Shrine" preceding "of Saint Anthony of Padua Capuchin Friars Minor Hawthorn - Melbourne Victoria" is in my opinion critical.
In my opinion, the words of cl 8(a) make clear that the bequest was to be to the "organisation" administering or associated with the Shrine (since it is contemplated that there will be a secretary or treasurer of the organisation capable of issuing a receipt for the gift under the Will). Similarly, I concur with the advice of Senior Counsel that it is overwhelmingly likely that the terms of the bequest had their origins in advice given by Father Hrdina and that the Will evidences a testamentary intention to make a gift to the Order of the Capuchin Friars Minor.
However, as indicated, the fact that the bequest is expressed to be upon trust for the "Shrine" leads me to conclude that the gift was to be for the purpose of the preservation, upkeep and maintenance of the Shrine (and activities directly associated with the Shrine) but not for the activities of the Capuchin Friars Minor more generally (such as community and pastoral work not associated with or relating to the Shrine - for example, activities associated with the church and school at the head office address in Leichhardt).
To my mind, that broader interpretation would render otiose the word "Shrine" in the bequest and, thereby, do impermissible violence to the words used.
Further, while it might in some cases be permissible to reason towards or to discover (by reference to extrinsic evidence) some broader intended purpose on the part of the donor than that disclosed by the words used in the bequest, here there is little, if any, cogent evidence to support any conclusion from inferences of that kind. Certainly, there is nothing in the evidence to which I have been taken that indicates a more general intention to benefit the Order (i.e., other than as associated with the Shrine itself). For example, the evidence of Father Messina as to the name that Father Hdrina would provide to people wishing to make gifts says nothing about the intended purposes of those persons whom subsequently made gifts (and, certainly nothing about the particular intentions of the deceased).
I will make orders giving judicial advice accordingly.
In the executors' written submissions, they appear to seek a further opportunity to argue the case in the event that the Court is not prepared on the material before it to give the executors judicial advice in the terms sought. Specifically, in their written submissions the executors seek in that event a direction that the matter be re-listed for the purpose of addressing the Court and, if necessary, making an application for leave to adduce such further evidence as may be required.
I am not persuaded that I should follow that course. The executors have had the opportunity to put forward evidence and submissions on their application and they suggested that the matter be dealt with on the papers. I acceded to that proposal and have proceeded on that course. In this respect, I note that a judicial advice application is not akin to an advice on evidence.
That said, when these reasons are published, I will be prepared to consider any application that the executors wish to make within fourteen days for variation of the orders or to re-open the case to adduce further evidence and, if that be desired, then I will make directions to facilitate this.
As to costs, as indicated at the outset, I accept that the executors have appropriately sought advice in respect of their ongoing obligations as trustees for the benefit of the beneficiaries and have acted on the advice of Senior Counsel in bringing the present application for judicial advice.
The appropriate order is that the executors' costs be paid on the indemnity basis from the deceased's estate.
[5]
Orders
For the above reasons I make the following orders:
1. Pursuant to s 63 of the Trustee Act 1925 (NSW), advise the executors of the estate of the late Stasha Berger (also known as Stanislava Bergerova) (the deceased) that, under clause 8(a) of the Deceased's Will made on 21 December 2017, they would be justified in paying 80% of the residue of the deceased's estate to the Trustees of the Order of the Capuchin Friars Minor (and effecting that payment at the direction of the Trustees of the Order of the Capuchin Friars Minor by depositing the funds into a nominated bank account in the name of the "Capuchin Franciscan Friars"), after having informed the Trustees of the terms of the Will and that the gift was made upon trust for "Shrine of Saint Anthony of Padua Capuchin Friars Minor Hawthorn - Melbourne Victoria", and having confirmed with the Trustees their intention to use the funds to maintain the Shrine of Saint Anthony of Padua situated in Hawthorn, Victoria and for activities of the Order of the Capuchin Friars Minor associated with that Shrine; and on the basis that the provision of a receipt by the secretary or treasurer of the Trustees for the said funds will be a sufficient discharge of their obligations as executors and trustees under clause 8(a) of the deceased's Will.
2. Order that the executors' costs of this application be paid out of the deceased estate on the indemnity basis.
[6]
Amendments
18 June 2020 - [2] - typographical error to the date
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Decision last updated: 18 June 2020
Legislation Cited (3)
Roman Catholic Church Communities' Lands Act 1942(NSW)